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EXHIBIT 4.1
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CREDIT AGREEMENT
DATED AS OF JANUARY 30, 1998,
AMONG
VISION TWENTY-ONE, INC.,
THE BANKS PARTY HERETO,
AND
BANK OF MONTREAL,
as Agent
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TABLE OF CONTENTS
SECTION DESCRIPTION PAGE
SECTION 1. THE CREDIT FACILITIES............................................................................... 1
Section 1.1. Revolving Credit Commitments......................................................... 1
Section 1.2. Letters of Credit.................................................................... 1
Section 1.3. Term Credit Commitments.............................................................. 3
Section 1.4. Applicable Interest Rates........................................................... 4
Section 1.5. Minimum Borrowing Amounts........................................................... 7
Section 1.6. Manner of Borrowing Loans and Designating Applicable Interest Rates................. 7
Section 1.7. Interest Periods.................................................................... 9
Section 1.8. Maturity of Loans................................................................... 10
Section 1.9. Prepayments......................................................................... 10
Section 1.10. Default Rate........................................................................ 11
Section 1.11. The Notes........................................................................... 11
Section 1.12. Funding/Hedging Indemnity........................................................... 12
Section 1.13. Commitment Terminations............................................................. 13
SECTION 2. FEES, EXTENSIONS, AND SUBSTITUTION OF BANKS........................................................ 14
Section 2.1. Fees................................................................................ 14
Section 2.2. Extensions of the Revolving Credit Termination Date................................. 15
Section 2.3. Substitution of Banks............................................................... 15
SECTION 3. PLACE AND APPLICATION OF PAYMENTS.................................................................. 16
SECTION 4. COLLATERAL AND GUARANTIES.......................................................................... 17
Section 4.1. Collateral.......................................................................... 17
Section 4.2 Collections......................................................................... 18
Section 4.3. Guaranties.......................................................................... 18
Section 4.4. Further Assurances.................................................................. 18
Section 4.5. Liens on After-Acquired Real Property............................................... 19
SECTION 5. DEFINITIONS; INTERPRETATION........................................................................ 19
Section 5.1. Definitions......................................................................... 19
Section 5.2. Interpretation...................................................................... 30
Section 5.3. Change in Accounting Principles..................................................... 31
SECTION 6. REPRESENTATIONS AND WARRANTIES..................................................................... 31
Section 6.1. Organization and Qualification...................................................... 31
Section 6.2. Subsidiaries........................................................................ 31
Section 6.3. Authority and Validity of Obligations............................................... 32
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Section 6.4. Use of Proceeds; Margin Stock.................................... 32
Section 6.5. Financial Reports................................................ 33
Section 6.6. No Material Adverse Change....................................... 33
Section 6.7. Full Disclosure.................................................. 33
Section 6.8. Trademarks, Franchises, and Licenses............................. 33
Section 6.9. Governmental Authority and Licensing............................. 34
Section 6.10. Good Title....................................................... 34
Section 6.11. Litigation and Other Controversies............................... 34
Section 6.12. Taxes............................................................ 34
Section 6.13. Approvals........................................................ 34
Section 6.14. Affiliate Transactions........................................... 35
Section 6.15. Investment Company; Public Utility Holding Company............... 35
Section 6.16. ERISA............................................................ 35
Section 6.17. Compliance with Laws............................................. 35
Section 6.18. Other Agreements................................................. 35
Section 6.19. Solvency......................................................... 36
Section 6.20. Capital Structure................................................ 36
Section 6.21. No Default....................................................... 36
SECTION 7. CONDITIONS PRECEDENT............................................................ 36
Section 7.1. Initial Credit Event............................................. 36
Section 7.2. All Credit Events................................................ 38
SECTION 8. COVENANTS....................................................................... 38
Section 8.1. Maintenance of Business.......................................... 38
Section 8.2. Maintenance of Properties........................................ 38
Section 8.3. Taxes and Assessments............................................ 39
Section 8.4. Insurance........................................................ 39
Section 8.5. Financial Reports................................................ 39
Section 8.6. Inspection....................................................... 41
Section 8.8. Total Funded Debt/Adjusted EBITDA Ratio.......................... 41
Section 8.9. Net Worth........................................................ 42
Section 8.10. Interest Coverage Ratio.......................................... 42
Section 8.11. Debt Service Coverage Ratio...................................... 42
Section 8.12. Capital Expenditures............................................. 43
Section 8.13. Indebtedness for Borrowed Money.................................. 43
Section 8.14. Liens............................................................ 44
Section 8.15. Investments, Acquisitions, Loans, Advances and Guaranties........ 45
Section 8.16. Mergers, Consolidations and Sales................................ 47
Section 8.17. Maintenance of Subsidiaries...................................... 47
Section 8.18. Dividends and Certain Other Restricted Payments.................. 48
Section 8.19. ERISA............................................................ 48
Section 8.20. Compliance with Laws............................................. 48
Section 8.21. Burdensome Contracts With Affiliates............................. 48
Section 8.22. No Changes in Fiscal Year........................................ 49
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Section 8.23. Formation of Subsidiaries................................................ 49
Section 8.24. Change in the Nature of Business......................................... 49
Section 8.25. Change in Capital Structure.............................................. 49
Section 8.26. Use of Loan Proceeds..................................................... 49
Section 8.27. No Restrictions on Subsidiary Distributions.............................. 49
Section 8.28. Block Vision of Texas.................................................... 49
SECTION 9. EVENTS OF DEFAULT AND REMEDIES.......................................................... 49
Section 9.1. Events of Default........................................................ 49
Section 9.2. Non-Bankruptcy Defaults.................................................. 52
Section 9.3. Bankruptcy Defaults...................................................... 52
Section 9.4. Collateral for Undrawn Letters of Credit................................. 52
Section 9.5. Notice of Default........................................................ 53
Section 9.6. Expenses................................................................. 53
SECTION 10. CHANGE IN CIRCUMSTANCES................................................................. 53
Section 10.1. Change of Law............................................................ 53
Section 10.2. Unavailability of Deposits or Inability to Ascertain, or Inadequacy of,
LIBOR.................................................................... 53
Section 10.3. Increased Cost and Reduced Return........................................ 54
Section 10.4. Lending Offices.......................................................... 55
Section 10.5. Discretion of Bank as to Manner of Funding............................... 55
SECTION 11. THE AGENT............................................................................... 56
Section 11.1. Appointment and Authorization of Agent................................... 56
Section 11.2. Agent and its Affiliates................................................. 56
Section 11.3. Action by Agent.......................................................... 56
Section 11.4. Consultation with Experts................................................ 57
Section 11.5. Liability of Agent; Credit Decision...................................... 57
Section 11.6. Indemnity................................................................ 57
Section 11.7. Resignation of Agent and Successor Agent................................. 58
SECTION 12. MISCELLANEOUS........................................................................... 58
Section 12.1. Withholding Taxes........................................................ 58
Section 12.2. No Waiver, Cumulative Remedies........................................... 59
Section 12.3. Non-Business Days........................................................ 59
Section 12.4. Documentary Taxes........................................................ 59
Section 12.5. Survival of Representations.............................................. 59
Section 12.6. Survival of Indemnities.................................................. 60
Section 12.7. Sharing of Set-Off....................................................... 60
Section 12.8. Notices.................................................................. 60
Section 12.9. Counterparts............................................................. 61
Section 12.10. Successors and Assigns................................................... 61
Section 12.11. Participants............................................................. 61
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Section 12.12. Assignment of Commitments by Banks.................................................. 62
Section 12.13. Amendments.......................................................................... 62
Section 12.14. Headings............................................................................ 63
Section 12.15. Costs and Expenses.................................................................. 63
Section 12.16. Set-off............................................................................. 63
Section 12.17. Entire Agreement.................................................................... 64
Section 12.18. Governing Law....................................................................... 64
Section 12.19. Severability of Provisions.......................................................... 64
Section 12.20. Excess Interest..................................................................... 64
Section 12.21. Confidentiality..................................................................... 64
Section 12.22. Single Bank......................................................................... 65
Section 12.23. Submission to Jurisdiction; Waiver of Jury Trial.................................... 65
Signature Page.................................................................................................... 66
EXHIBIT A - Notice of Payment Request
EXHIBIT B - Revolving Note
EXHIBIT C - Term Note
EXHIBIT D - Compliance Certificate
EXHIBIT E - Request for New Borrowing
EXHIBIT F - Rollover/Conversion Request
EXHIBIT G - Notice of Repayment
EXHIBIT H - Assignment and Acceptance
SCHEDULE 6.2 - Subsidiaries
SCHEDULE 6.7 - Additional Disclosures
SCHEDULE 6.12 - Taxes
SCHEDULE 8.13 - Existing Indebtedness
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CREDIT AGREEMENT
To each of the Banks signatory hereto
Ladies and Gentlemen:
The undersigned, Vision Twenty-One, Inc., a Florida corporation (the
"Borrower"), applies to you for your several commitments, subject to the terms
and conditions hereof and on the basis of the representations and warranties
hereinafter set forth, to extend credit to the Borrower, all as more fully
hereinafter set forth. Each of you is hereinafter referred to as a "Bank," all
of you are hereinafter referred to collectively as the "Banks," and Bank of
Montreal in its capacity as agent for the Banks hereunder is hereinafter
referred to as the "Agent."
SECTION 1. THE CREDIT FACILITIES.
Section 1.1. Revolving Credit Commitments. Subject to the terms
and conditions hereof, each Bank, by its acceptance hereof, severally agrees to
make a loan or loans (individually a "Revolving Loan" and collectively the
"Revolving Loans") to the Borrower from time to time on a revolving basis up to
the amount of such Bank's revolving credit commitment set forth on the
applicable signature page hereof or pursuant to Section 12.12 hereof (its
"Revolving Credit Commitment" and, cumulatively for all the Banks, the
"Revolving Credit Commitments"), subject to any reductions thereof pursuant to
the terms hereof, before the Revolving Credit Termination Date. The sum of the
aggregate principal amount of Revolving Loans and of L/C Obligations at any
time outstanding shall not exceed the Revolving Credit Commitments in effect at
such time. Each Borrowing of Revolving Loans shall be made ratably from the
Banks in proportion to their respective Revolver Percentages. As provided in
Section 1.6(a) hereof, the Borrower may elect that each Borrowing of Revolving
Loans be either Base Rate Loans or Eurodollar Loans. Revolving Loans may be
repaid and the principal amount thereof reborrowed before the Revolving Credit
Termination Date, subject to the terms and conditions hereof.
Section 1.2. Letters of Credit. (a) General Terms. Subject to
the terms and conditions hereof, as part of the Revolving Credit, the Agent
shall issue standby letters of credit (each a "Letter of Credit") for the
Borrower's account in an aggregate undrawn face amount up to the amount of the
L/C Commitment, provided that the aggregate L/C Obligations at any time
outstanding shall not exceed the difference between the Revolving Credit
Commitments in effect at such time and the aggregate principal amount of
Revolving Loans then outstanding. Each Letter of Credit shall be issued by the
Agent, but each Bank shall be obligated to reimburse the Agent for such Bank's
Revolver Percentage of the amount of each drawing thereunder and, accordingly,
each Letter of Credit shall constitute usage of the Revolving Credit Commitment
of each Bank pro rata in accordance with its Revolver Percentage.
(b) Applications. At any time before the Revolving Credit
Termination Date, the Agent shall, at the request of the Borrower, issue one or
more Letters of Credit, in a form
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satisfactory to the Agent, with expiration dates no later than the earlier of 12
months from the date of issuance (or be cancelable not later than 12 months from
the date of issuance and each renewal) or Revolving Credit Termination Date, in
an aggregate face amount as set forth above, upon the receipt of an application
duly executed by the Borrower for the relevant Letter of Credit in the form then
customarily prescribed by the Agent for the Letter of Credit requested (each an
"Application"). Notwithstanding anything contained in any Application to the
contrary: (i) the Borrower shall pay fees in connection with each Letter of
Credit as set forth in Section 2.1 hereof, (ii) except as otherwise provided in
Section 1.9 hereof, before the occurrence of a Default or an Event of Default,
the Agent will not call for the funding by the Borrower of any amount under a
Letter of Credit before being presented with a drawing thereunder, and (iii) if
the Agent is not timely reimbursed for the amount of any drawing under a Letter
of Credit on the date such drawing is paid, the Borrower's obligation to
reimburse the Agent for the amount of such drawing shall bear interest (which
the Borrower hereby promises to pay) from and after the date such drawing is
paid at a rate per annum equal to the sum of 2% plus the Applicable Margin plus
the Base Rate from time to time in effect. If the Agent issues any Letter of
Credit with an expiration date that is automatically extended unless the Agent
gives notice that the expiration date will not so extend beyond its then
scheduled expiration date, the Agent will give such notice of non-renewal before
the time necessary to prevent such automatic extension if before such required
notice date: (i) the expiration date of such Letter of Credit if so extended
would be after the Revolving Credit Termination Date, (ii) the Revolving Credit
Commitments have been terminated, or (iii) a Default or an Event of Default
exists and the Required Banks have given the Agent instructions not to so permit
the extension of the expiration date of such Letter of Credit. The Agent agrees
to issue amendments to the Letter(s) of Credit increasing the amount, or
extending the expiration date, thereof at the request of the Borrower subject to
the conditions of Section 7.2 hereof and the other terms of this Section 1.2.
(c) The Reimbursement Obligations. Subject to Section 1.2(b)
hereof, the obligation of the Borrower to reimburse the Agent for all drawings
under a Letter of Credit (a "Reimbursement Obligation") shall be governed by
the Application related to such Letter of Credit, except that reimbursement
shall be made by no later than 12:00 Noon (Chicago time) on the date when each
drawing is paid in immediately available funds at the Agent's principal office
in Chicago, Illinois. If the Borrower does not make any such reimbursement
payment on the date due and the Participating Banks fund their participations
therein in the manner set forth in Section 1.2(d) below, then all payments
thereafter received by the Agent in discharge of any of the relevant
Reimbursement Obligations shall be distributed in accordance with Section
1.2(d) below.
(d) The Participating Interests. Each Bank (other than the Bank
then acting as Agent in issuing Letters of Credit), by its acceptance hereof,
severally agrees to purchase from the Agent, and the Agent hereby agrees to
sell to each such Bank (a "Participating Bank"), an undivided percentage
participating interest (a "Participating Interest"), to the extent of its
Revolver Percentage, in each Letter of Credit issued by, and each Reimbursement
Obligation owed to, the Agent. Upon any failure by the Borrower to pay any
Reimbursement Obligation at the time required on the date the related drawing
is paid, as set forth in Section 1.2(c) above, or if the Agent is required at
any time to return to the Borrower or to a trustee, receiver,
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liquidator, custodian, or other Person any portion of any payment of any
Reimbursement Obligation, each Participating Bank shall, not later than the
Business Day it receives a certificate in the form of Exhibit A hereto from the
Agent to such effect, if such certificate is received before 1:00 p.m. (Chicago
time), or not later than 1:00 p.m. (Chicago time) the following Business Day, if
such certificate is received after such time, pay to the Agent an amount equal
to such Participating Bank's Revolver Percentage of such unpaid or recaptured
Reimbursement Obligation together with interest on such amount accrued from the
date the related payment was made by the Agent to the date of such payment by
such Participating Bank at a rate per annum equal to: (i) from the date the
related payment was made by the Agent to the date 2 Business Days after payment
by such Participating Bank is due hereunder, the Federal Funds Rate for each
such day and (ii) from the date 2 Business Days after the date such payment is
due from such Participating Bank to the date such payment is made by such
Participating Bank, the Base Rate in effect for each such day. Each such
Participating Bank shall thereafter be entitled to receive its Revolver
Percentage of each payment received in respect of the relevant Reimbursement
Obligation and of interest paid thereon, with the Agent retaining its Revolver
Percentage as a Bank hereunder.
The several obligations of the Participating Banks to the Agent under
this Section 1.2 shall be absolute, irrevocable, and unconditional under any
and all circumstances whatsoever and shall not be subject to any set-off,
counterclaim or defense to payment which any Participating Bank may have or
have had against the Borrower, the Agent, any other Bank, or any other Person
whatsoever. Without limiting the generality of the foregoing, such obligations
shall not be affected by any Default or Event of Default or by any reduction or
termination of any Commitment of any Bank, and each payment by a Participating
Bank under this Section 1.2 shall be made without any offset, abatement,
withholding, or reduction whatsoever. The Agent shall be entitled to offset
amounts received for the account of a Bank under this Agreement against unpaid
amounts due from such Bank to the Agent hereunder (whether as fundings of
participations, indemnities, or otherwise), but shall not be entitled to offset
against amounts owed to the Agent by any Bank arising outside of this
Agreement.
(e) Indemnification. The Participating Banks shall, to the extent
of their respective Revolver Percentages, indemnify the Agent (to the extent
not reimbursed by the Borrower) against any cost, expense (including reasonable
counsel fees and disbursements), claim, demand, action, loss, or liability
(except such as result from the Agent's gross negligence or willful misconduct)
that the Agent may suffer or incur in connection with any Letter of Credit.
The obligations of the Participating Banks under this Section 1.2(e) and all
other parts of this Section 1.2 shall survive termination of this Agreement and
of all Applications, Letters of Credit, and all drafts and other documents
presented in connection with drawings thereunder.
Section 1.3. Term Credit Commitments. Subject to the terms and
conditions hereof, each Bank, by its acceptance hereof, severally agrees to
make one or more loans (individually a "Term Loan" and collectively the "Term
Loans") to the Borrower from time to time in the aggregate amount of such
Bank's term credit commitment as set forth on the applicable signature page
hereof or pursuant to Section 12.12 hereof (its "Term Credit Commitment" and,
cumulatively for all the Banks, the "Term Credit Commitments"), subject to any
reductions thereof pursuant to the terms hereof, before the Term Credit
Termination Date.
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Each Borrowing of Term Loans shall be made ratably by the Banks in proportion to
their respective Term Percentages. Each Borrowing of Term Loans shall be used
solely for the purpose of (a) retiring indebtedness owing to Prudential
Securities Credit Corporation, (b) financing acquisitions permitted under
Section 8.15(k) hereof, and (c) financing the redemption of certain equity
securities of the Borrower pursuant to Section 8.18(b) hereof. Each Borrowing of
Term Loans shall be in an amount of $1,000,000 or such greater amount which is
an integral multiple of $100,000. As provided in Section 1.6(a) hereof, the
Borrower may elect that each Borrowing of Term Loans be either Base Rate Loans,
Eurodollar Loans, or Fixed Rate Loans. The principal amount of each Term Loan
made by a Bank to the Borrower shall permanently reduce the amount available to
the Borrower under such Bank's Term Credit Commitment, and no amount repaid or
prepaid on any Term Loan may be borrowed again.
Section 1.4. Applicable Interest Rates. (a) Base Rate Loans.
Each Base Rate Loan made or maintained by a Bank shall bear interest during
each Interest Period it is outstanding on the unpaid principal amount thereof
from the date such Loan is advanced, continued or created by conversion from a
Eurodollar Loan until maturity (whether by acceleration or otherwise) at a rate
per annum equal to the sum of the Applicable Margin plus the Base Rate from
time to time in effect, payable on the last day of its Interest Period and at
maturity (whether by acceleration or otherwise).
"Base Rate" means for any day the greater of: (i) the rate of
interest announced by the Agent from time to time as its prime commercial rate,
or equivalent, for U.S. Dollar loans to borrowers located in the United States
with any change in the Base Rate resulting from a change in said prime
commercial rate to be effective as of the date of the relevant change in said
prime commercial rate (it being acknowledged and agreed that such rate may not
be the Agent's best or lowest rate (computed on the basis of a year of 365 or
366 days, as the case may be, and actual days elapsed); and (ii) the sum of (x)
the rate for that day set forth opposite the caption "Federal Fund (Effective)"
in the daily statistical release designated as "Composite 3:30 P.M. Quotations
for U.S. Government Securities," or any successor publication, published by the
Federal Reserve Bank of New York or, if such publication shall be suspended or
terminated, the rate determined by the Agent (based on quotations received from
two or more Federal funds dealers of recognized standing) to be the prevailing
rate per annum (rounded upward, if necessary, to the nearest 1/100 of 1%) at
approximately 10:00 a.m. (Chicago time) (or as soon thereafter as is
practicable) on such day for the purchase at face value of overnight Federal
funds in an amount approximately equal to the principal amount owed to the
Agent for which such rate is being determined, plus (y) 1/2 of 1% (computed on
the basis of a year of 360 days and actual days elapsed).
(b) Eurodollar Loans. Each Eurodollar Loan made or maintained by
a Bank shall bear interest during each Interest Period it is outstanding
(computed on the basis of a year of 360 days and actual days elapsed) on the
unpaid principal amount thereof from the date such Loan is advanced, continued,
or created by conversion from a Base Rate Loan until maturity (whether by
acceleration or otherwise) at a rate per annum equal to the sum of the
Applicable Margin plus the Adjusted LIBOR applicable for such Interest Period,
payable on the last day of the Interest Period and at maturity (whether by
acceleration or otherwise), and, if the
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applicable Interest Period is longer than three months, on each day occurring
every three months after the commencement of such Interest Period.
"Adjusted LIBOR" means, for any Borrowing of Eurodollar Loans, a rate
per annum determined in accordance with the following formula:
Adjusted LIBOR = LIBOR
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1 - Eurodollar Reserve Percentage
"LIBOR" means, for an Interest Period for a Borrowing of Eurodollar
Loans, (a) the LIBOR Index Rate for such Interest Period, if such rate is
available, and (b) if the LIBOR Index Rate cannot be determined, the arithmetic
average of the rates of interest per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) at which deposits in U.S. Dollars in immediately
available funds are offered to the Agent at 11:00 a.m. (London, England time) 2
Business Days before the beginning of such Interest Period by 3 or more major
banks in the interbank eurodollar market selected by the Agent for delivery on
the first day of and for a period equal to such Interest Period and in an
amount equal or comparable to the principal amount of the Eurodollar Loan
scheduled to be made by the Agent as part of such Borrowing.
"LIBOR Index Rate" means, for any Interest Period, the rate per annum
(rounded upwards, if necessary, to the next higher one hundred-thousandth of a
percentage point) for deposits in U.S. Dollars for a period equal to such
Interest Period, which appears on the Telerate Page 3750 as of 11:00 a.m.
(London, England time) on the day 2 Business Days before the commencement of
such Interest Period.
"Telerate Page 3750" means the display designated as "Page 3750" on
the Telerate Service (or such other page as may replace Page 3750 on that
service or such other service as may be nominated by the British Bankers'
Association as the information vendor for the purpose of displaying British
Bankers' Association Interest Settlement Rates for U.S. Dollar deposits).
"Eurodollar Reserve Percentage" means, for any Borrowing of Eurodollar
Loans, the daily average for the applicable Interest Period of the maximum
rate, expressed as a decimal, at which reserves (including, without limitation,
any supplemental, marginal, and emergency reserves) are imposed during such
Interest Period by the Board of Governors of the Federal Reserve System (or any
successor) on "eurocurrency liabilities", as defined in such Board's Regulation
D (or in respect of any other category of liabilities that includes deposits by
reference to which the interest rate on Eurodollar Loans is determined or any
category of extensions of credit or other assets that include loans by
non-United States offices of any Bank to United States residents), subject to
any amendments of such reserve requirement by such Board or its successor,
taking into account any transitional adjustments thereto. For purposes of this
definition, the Eurodollar Loans shall be deemed to be "eurocurrency
liabilities" as defined in Regulation D without benefit or credit for any
prorations, exemptions or offsets under Regulation D.
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(c) Fixed Rate Loans. Each Fixed Rate Loan made or maintained by
a Bank shall bear interest during each Interest Period it is outstanding
(computed on the basis of a year of 360 days for the actual days elapsed) on
the unpaid principal amount thereof from the date such Loan is advanced until
maturity (whether by acceleration or otherwise) at a rate per annum equal to
the sum of the Applicable Margin with respect to Eurodollar Loans as from time
to time in effect plus the Adjusted Fixed Rate applicable to the relevant
Borrowing of Term Loans, payable on the last day of each March, June,
September, and December occurring after the relevant Borrowing of Fixed Rate
Loans is advanced and at maturity (whether by acceleration or otherwise).
Fixed Rate Loans shall only be available for Borrowings of Term Loans. In the
event the Borrower elects that a Borrowing of Term Loans constitute Fixed Rate
Loans, such election shall be irrevocable and remain in effect with respect to
such Borrowing of Term Loans from the date such Loans are advanced through the
Term Credit Final Maturity Date.
"Adjusted Fixed Rate" means, for any Borrowing of Fixed Rate Loans, a
rate per annum determined in accordance with the following formula:
Adjusted Fixed Rate = Fixed Rate
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100% - Eurodollar Reserve Percentage
"Floating Rate Payor" means Bank of Montreal, in its capacity as a
payment obligor under Section 1.4(d) below.
"Fixed Rate" means, with respect to a Borrowing of Fixed Rate Loans
advanced on the same day, the rate per annum quoted to the Borrower by the
Floating Rate Payor on the date on which such Borrowing is to be advanced, it
being acknowledged and agreed that the Fixed Rate shall be established at the
time of each Borrowing of Term Loans by the Floating Rate Payor in its sole
discretion.
(d) Floating Rate Payor Obligation. Subject to receipt by the
Agent of payment in full of interest due by the Borrower with respect to each
Borrowing of Fixed Rate Loans, the Agent will remit to the Floating Rate Payor
the interest so paid by the Borrower and the Floating Rate Payor shall pay to
the Agent for distribution to the Banks ratably an amount equal to interest
which would have accrued on such Borrowing for the relevant Interest Period at
a rate per annum equal to the sum of the Applicable Margin with respect to
Eurodollar Loans in effect during such period plus the Adjusted LIBOR (as
determined by the Floating Rate Payor on the first day of the relevant calendar
quarter and determined as if the relevant Interest Period was 3 months,
provided during the first three months following the date hereof such rate
shall be determined on the first day of each month and determined as if the
relevant Interest Period was 1 month). In the event any such Fixed Rate Loans
bear interest at the default rate provided for in Section 1.10(c) hereof, the
Banks shall also be entitled to receive from the Floating Rate Payor their pro
rata share thereof, based on their Term Percentages of the relevant Borrowing
of Term Loans, to the extent paid by the Borrower. In the event interest on
any such Fixed Rate Loan is not paid, either in whole or in part, by the
Borrower, then the Floating Rate Payor shall be obligated to pay to the Agent
for distribution to the Banks an amount determined by multiplying the amounts
due the Banks as set forth above
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times a fraction, the numerator of which is the amount of interest actually paid
by the Borrower to the Agent and the denominator of which is the amount of
interest due from Borrower with respect to such Fixed Rate Loans.
(e) Rate Determinations. The Agent shall determine each interest
rate applicable to the Loans (other than Fixed Rate Loans) and the
Reimbursement Obligations hereunder, and its determination thereof shall be
conclusive and binding except in the case of manifest error. The Floating Rate
Payor shall determine each interest rate applicable to the Fixed Rate Loans,
and its determination thereof shall be conclusive and binding except in the
case of manifest error.
Section 1.5. Minimum Borrowing Amounts. Each Borrowing of Base
Rate Loans advanced under a Credit shall be in an amount not less than
$1,000,000. Each Borrowing of Eurodollar Loans advanced, continued, or
converted under a Credit shall be in an amount equal to $1,000,000 or such
greater amount which is an integral multiple of $100,000. Each Borrowing of
Fixed Rate Loans advanced under the Term Credit shall be in an amount equal to
$1,000,000 or such greater amount which is an integral multiple of $100,000.
Section 1.6. Manner of Borrowing Loans and Designating
Applicable Interest Rates. (a) Notice to the Agent. The Borrower shall give
notice to the Agent by no later than 10:00 a.m. (Chicago time): (i) at least 3
Business Days before the date on which the Borrower requests the Banks to
advance a Borrowing of Eurodollar Loans, (ii) at least 3 Business Days before
the date on which the Borrower requests the Banks to advance a Borrowing of
Term Loans which are Fixed Rate Loans, and (iii) on the date the Borrower
requests the Banks to advance a Borrowing of Base Rate Loans. The Loans
included in each Borrowing shall bear interest initially at the type of rate
specified in such notice of a new Borrowing. Thereafter, except with respect
to Fixed Rate Loans, the Borrower may from time to time elect to change or
continue the type of interest rate borne by each Borrowing or, subject to
Section 1.5's minimum amount requirement for each outstanding Borrowing, a
portion thereof, as follows: (i) if such Borrowing is of Eurodollar Loans, on
the last day of the Interest Period applicable thereto, the Borrower may
continue part or all of such Borrowing as Eurodollar Loans or convert part or
all of such Borrowing into Base Rate Loans or (ii) if such Borrowing is of Base
Rate Loans, on any Business Day, the Borrower may convert all or part of such
Borrowing into Eurodollar Loans for an Interest Period or Interest Periods
specified by the Borrower. The Borrower shall give all such notices requesting
the advance, continuation, or conversion of a Borrowing to the Agent by
telephone or telecopy (which notice shall be irrevocable once given and, if by
telephone, shall be promptly confirmed in writing), substantially in the form
attached hereto as Exhibit E (Request for New Borrowing) or Exhibit F
(Rollover/Conversion Request), as applicable, or in such other form acceptable
to the Agent. Notices of the continuation of a Borrowing of Eurodollar Loans
for an additional Interest Period or of the conversion of part or all of a
Borrowing of Eurodollar Loans into Base Rate Loans or of Base Rate Loans into
Eurodollar Loans must be given by no later than 10:00 a.m. (Chicago time) at
least 3 Business Days before the date of the requested continuation or
conversion. All such notices concerning the advance, continuation, or
conversion of a Borrowing shall specify the date of the requested advance,
continuation, or conversion of a Borrowing (which shall be a Business Day), the
amount of the requested Borrowing to be advanced, continued, or
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converted, the type of Loans to comprise such new, continued, or converted
Borrowing and, if such Borrowing is to be comprised of Eurodollar Loans, the
Interest Period applicable thereto. The Borrower agrees that the Agent may rely
on any such telephonic or telecopy notice given by any person the Agent in good
faith believes is an Authorized Representative without the necessity of
independent investigation, and in the event any such notice by telephone
conflicts with any written confirmation, such telephonic notice shall govern if
the Agent has acted in reliance thereon.
(b) Notice to the Banks. The Agent shall give prompt telephonic
or telecopy notice to each Bank of any notice from the Borrower received
pursuant to Section 1.6(a) above and, if such notice requests the Banks to make
Eurodollar Loans, the Agent shall give notice to the Borrower and each Bank by
like means of the interest rate applicable thereto promptly after the Agent has
made such determination.
(c) Borrower's Failure to Notify; Automatic Continuations and
Conversions. Any outstanding Borrowing of Base Rate Loans shall automatically
be continued for an additional Interest Period on the last day of its then
current Interest Period unless the Borrower has notified the Agent within the
period required by Section 1.6(a) that the Borrower intends to convert such
Borrowing, subject to Section 7.2 hereof, into a Borrowing of Eurodollar Loans
or such Borrowing is prepaid in accordance with Section 1.9(a). If the
Borrower fails to give notice pursuant to Section 1.6(a) above of the
continuation or conversion of any outstanding principal amount of a Borrowing
of Eurodollar Loans before the last day of its then current Interest Period
within the period required by Section 1.6(a) or, whether or not such notice has
been given, one or more of the conditions set forth in Section 7.2 for the
continuation or conversion of a Borrowing of Eurodollar Loans would not be
satisfied (unless such conditions have been waived in accordance with the terms
of this Agreement), and such Borrowing is not prepaid in accordance with
Section 1.9(a), such Borrowing shall automatically be converted into a
Borrowing of Base Rate Loans.
(d) Disbursement of Loans. Not later than 1:00 p.m. (Chicago
time) on the date of any requested advance of a new Borrowing, subject to
Section 7 hereof, each Bank shall make available its Loan comprising part of
such Borrowing in funds immediately available at the principal office of the
Agent in Chicago, Illinois. The Agent shall make the proceeds of each new
Borrowing available to the Borrower at the Agent's principal office in Chicago,
Illinois (or by wire transfer of funds pursuant to the Borrower's written
instructions to the Agent).
(e) Agent Reliance on Bank Funding. Unless the Agent shall have
been notified by a Bank prior to (or, in the case of a Borrowing of Base Rate
Loans, by 1:00 p.m. (Chicago time) on) the date on which such Bank is scheduled
to make payment to the Agent of the proceeds of a Loan (which notice shall be
effective upon receipt) that such Bank does not intend to make such payment,
the Agent may assume that such Bank has made such payment when due and the
Agent may in reliance upon such assumption (but shall not be required to) make
available to the Borrower the proceeds of the Loan to be made by such Bank and,
if any Bank has not in fact made such payment to the Agent, such Bank shall, on
demand, pay to the Agent the amount made available to the Borrower attributable
to such Bank together with interest thereon in respect of each day during the
period commencing on the date such amount was
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made available to the Borrower and ending on (but excluding) the date such Bank
pays such amount to the Agent at a rate per annum equal to (i) from the date the
related advance was made by the Agent to the date 2 Business Days after payment
by such Bank is due hereunder, the Federal Funds Rate for each such day and (ii)
from the date 2 Business Days after the date such payment is due from such Bank
to the date such payment is made by such Bank, the Base Rate in effect for each
such day. If such amount is not received from such Bank by the Agent immediately
upon demand, the Borrower will, on demand, repay to the Agent the proceeds of
the Loan attributable to such Bank with interest thereon at a rate per annum
equal to the interest rate applicable to the relevant Loan, but without such
payment being considered a payment or prepayment of a Loan under Section 1.12
hereof, so that the Borrower will have no liability under such Section with
respect to such payment.
Section 1.7. Interest Periods. As provided in Section 1.6(a)
hereof, at the time of each request to advance, continue, or create by
conversion a Borrowing of Eurodollar Loans, the Borrower shall select an
Interest Period applicable to such Loans from among the available options. The
term "Interest Period" means the period commencing on the date a Borrowing of
Loans is advanced, continued, or created by conversion and ending: (a) in the
case of Base Rate Loans, on the last day of the calendar quarter in which such
Borrowing is advanced, continued, or created by conversion (or on the last day
of the following calendar quarter if such Loan is advanced, continued or
created by conversion on the last day of a calendar quarter) and (b) in the
case of a Eurodollar Loan, 1, 2, 3, or 6 months thereafter; provided, however,
that:
(a) any Interest Period for a Borrowing of Revolving
Loans consisting of Base Rate Loans that otherwise would end after the
Revolving Credit Termination Date shall end on the Revolving Credit
Termination Date, and any Interest Period for a Borrowing of Term
Loans consisting of Base Rate Loans that otherwise would end after the
Term Credit Final Maturity Date shall end on the Term Credit Final
Maturity Date;
(b) no Interest Period with respect to any portion of the
Term Loans shall extend beyond the Term Loan Final Maturity Date, and
no Interest Period with respect to any portion of the Revolving Loans
shall extend beyond the Revolving Credit Termination Date;
(c) no Interest Period with respect to any portion of the
Term Loans consisting of Eurodollar Loans shall extend beyond a date
on which the Borrower is required to make a scheduled payment of
principal on the Term Loans, unless the sum of (a) the aggregate
principal amount of Term Loans that are Base Rate Loans plus (b) the
aggregate principal amount of Term Loans that are Eurodollar Loans
with Interest Periods expiring on or before such date plus (c) the
aggregate principal amount of Term Loans that are Fixed Rate Loans
scheduled to mature on or before such date equals or exceeds the
principal amount to be paid on the Term Loans on such payment date;
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(d) whenever the last day of any Interest Period would
otherwise be a day that is not a Business Day, the last day of such
Interest Period shall be extended to the next succeeding Business Day,
provided that, if such extension would cause the last day of an
Interest Period for a Borrowing of Eurodollar Loans to occur in the
following calendar month, the last day of such Interest Period shall be
the immediately preceding Business Day; and
(e) for purposes of determining an Interest Period for a
Borrowing of Eurodollar Loans, a month means a period starting on one
day in a calendar month and ending on the numerically corresponding
day in the next calendar month; provided, however, that if there is no
numerically corresponding day in the month in which such an Interest
Period is to end or if such an Interest Period begins on the last
Business Day of a calendar month, then such Interest Period shall end
on the last Business Day of the calendar month in which such Interest
Period is to end.
Section 1.8. Maturity of Loans. (a) Revolving Loans. Each
Revolving Loan shall mature and become due and payable by the Borrower on the
Revolving Credit Termination Date.
(b) Scheduled Payments of Term Loans. The Borrower shall make
principal payments on the Term Loans in installments on the last day of each
March, June, September and December in each year, commencing with the calendar
quarter ending March 31, 2000, with the amount of each such installment to
equal 2.5% of the original aggregate principal amount of the Term Loans made to
the Borrower on or prior to the Term Credit Termination Date (with each such
installment deemed to reduce each Fixed Rate Loan then outstanding by an amount
equal to 2.5% of the original principal amount thereof), except that the final
payment of both principal and interest not sooner paid on the Term Loans shall
be due and payable on the Term Credit Final Maturity Date. Each such principal
payment shall be applied to the Banks holding the Term Notes pro rata based
upon their Term Percentages.
Section 1.9. Prepayments. (a) Optional. The Borrower shall
have the privilege of prepaying without premium or penalty and in whole or in
part (but, if in part, then: (i) if such Borrowing is of Base Rate Loans, in
an amount not less than $500,000, (ii) if such Borrowing is of Eurodollar Loans
or Fixed Rate Loans, in an amount not less than $500,000, and (iii) in each
case, in an amount such that the minimum amount required for a Borrowing
pursuant to Section 1.5 hereof remains outstanding) any Borrowing of Eurodollar
Loans or Fixed Rate Loans at any time upon 3 Business Days prior notice to the
Agent or, in the case of a Borrowing of Base Rate Loans, notice delivered to
the Agent by the Borrower no later than 10:00 a.m. (Chicago time) on the date
of prepayment (such notice to be in substantially the form attached hereto as
Exhibit G (Notice of Repayment) or in such other form acceptable to the Agent),
such prepayment to be made by the payment of the principal amount to be prepaid
and, in the case of any Eurodollar Loan or Fixed Rate Loan, accrued interest
thereon to the date fixed for prepayment plus any amounts due the Banks under
Section 1.12 hereof. The Agent will promptly advise each Bank of any such
prepayment notice it receives from the Borrower. Any amount of Revolving Loans
paid or prepaid before the Revolving Credit Termination Date may, subject to
the terms and conditions of this Agreement, be borrowed,
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repaid and borrowed again. No amount of the Term Loans paid or prepaid may be
reborrowed.
(b) Mandatory. (i) The Borrower shall, on each date the
Revolving Credit Commitments are reduced pursuant to Section 1.13 hereof,
prepay the Revolving Loans and, if necessary, prefund the L/C Obligations by
the amount, if any, necessary to reduce the sum of the aggregate principal
amount of Revolving Loans and of L/C Obligations then outstanding to the amount
to which the Revolving Credit Commitments have been so reduced.
(ii) Unless the Borrower otherwise directs, prepayments of
Revolving Loans under this Section 1.9(b) shall be applied first to Borrowings
of Base Rate Loans until payment in full thereof with any balance applied to
Borrowings of Eurodollar Loans in the order in which their Interest Periods
expire. Each prepayment of Revolving Loans under this Section 1.9(b) shall be
made by the payment of the principal amount to be prepaid and accrued interest
thereon to the date of prepayment together with any amounts due the Banks under
Section 1.12 hereof. Each prefunding of L/C Obligations shall be made in
accordance with Section 9.4 hereof.
Section 1.10. Default Rate. Notwithstanding anything to the
contrary contained in Section 1.4 hereof, while any Event of Default exists or
after acceleration, the Borrower shall pay interest (after as well as before
entry of judgment thereon to the extent permitted by law) on the principal
amount of all Loans (computed on the basis of a year of 360 days and actual
days elapsed) at a rate per annum equal to:
(a) for any Base Rate Loan, the sum of 2% plus the
Applicable Margin plus the Base Rate from time to time in effect;
(b) for any Eurodollar Loan, the sum of 2% plus the rate
of interest in effect thereon at the time of such default until the
end of the Interest Period applicable thereto and, thereafter, at a
rate per annum equal to the sum of 2% plus the Applicable Margin for
Base Rate Loans plus the Base Rate from time to time in effect; and
(c) for any Fixed Rate Loan, the sum 2% plus the
interest in effect thereon at the time of such default;
provided, however, that (i) in the event any Fixed Rate Loan, or portion
thereof, is not paid when due, the overdue amount thereof shall bear interest
at the rate per annum equal to the rate per annum applicable to Base Rate Loans
hereunder after default and (ii) in the absence of acceleration, any other
adjustments pursuant to this Section 1.10 shall be made at the election of the
Required Banks with written notice to the Borrower. While any Event of Default
exists or after acceleration, interest shall be paid on demand of the Agent at
the request or with the consent of the Required Banks.
Section 1.11. The Notes. (a) The Revolving Loans made to the
Borrower by a Bank shall be evidenced by a single promissory note of the
Borrower issued to such Bank in the
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form of Exhibit B hereto. Each such promissory note is hereinafter referred to
as a "Revolving Note" and collectively such promissory notes are referred to as
the "Revolving Notes."
(b) The Terms Loans made to the Borrower by a Bank shall be
evidenced by a single promissory note of the Borrower issued to such Bank in
the form of Exhibit C hereto. Each such promissory note is hereinafter
referred to as a "Term Note" and collectively such promissory notes are
referred to as the "Term Notes."
(c) Each Bank shall record on its books and records or on a
schedule to its appropriate Note the amount of each Loan advanced, continued or
converted by it, all payments of principal and interest and the principal
balance from time to time outstanding thereon, the type of such Loan, and, for
any Eurodollar Loan, the Interest Period and, for any Eurodollar Loan or Fixed
Rate Loan, the interest rate applicable thereto. The record thereof, whether
shown on such books and records of a Bank or on a schedule to the relevant
Note, shall be prima facie evidence as to all such matters; provided, however,
that the failure of any Bank to record any of the foregoing or any error in any
such record shall not limit or otherwise affect the obligation of the Borrower
to repay all Loans made to it hereunder together with accrued interest thereon.
At the request of any Bank and upon such Bank tendering to the Borrower the
appropriate Note to be replaced, the Borrower shall furnish a new Note to such
Bank to replace any outstanding Note, and at such time the first notation
appearing on a schedule on the reverse side of, or attached to, such Note shall
set forth the aggregate unpaid principal amount of all Loans, if any, then
outstanding thereon.
Section 1.12. Funding/Hedging Indemnity. If any Bank or the
Floating Rate Payor shall incur any loss, cost or expense (including, without
limitation, any loss of profit, and any loss, cost or expense incurred by
reason of the liquidation or re-employment of deposits or other funds acquired
by such Bank or Floating Rate Payor to fund or maintain any Eurodollar Loan or
Fixed Rate Loan or the relending or reinvesting of such deposits or amounts
paid or prepaid to such Bank or, with respect to any Fixed Rate Loans, by
reason of the prepayment under or termination, in whole or in part, of any
interest rate hedging arrangement entered into by the Floating Rate Payor with
respect thereto) as a result of:
(a) any payment, prepayment or conversion of a Eurodollar
Loan on a date other than the last day of its Interest Period, or any
payment or prepayment of a Fixed Rate Loan on a date other than a
regularly scheduled payment date therefor as provided in Section
1.8(b) hereof,
(b) any failure (because of a failure to meet the
conditions of Section 7 or otherwise) by the Borrower to borrow a
Fixed Rate Loan, or to borrow or continue a Eurodollar Loan, or to
convert a Base Rate Loan into a Eurodollar Loan, on the date specified
in a notice given pursuant to Section 1.6(a),
(c) any failure by the Borrower to make any payment of
principal on any Eurodollar Loan or Fixed Rate Loan when due (whether
by acceleration or otherwise), or
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(d) any acceleration of the maturity of a Eurodollar Loan
or Fixed Rate Loan as a result of the occurrence of any Event of
Default hereunder,
then, upon the demand of such Bank or Floating Rate Payor, the Borrower shall
pay to such Bank or Floating Rate Payor such amount as will reimburse such Bank
or Floating Rate Payor for such loss, cost or expense. If any Bank or the
Floating Rate Payor makes such a claim for compensation, it shall provide to
the Borrower, with a copy to the Agent, a certificate setting forth the amount
of such loss, cost or expense in reasonable detail (including an explanation of
the basis for and the computation of such loss, cost or expense) and the
amounts shown on such certificate shall be conclusive if reasonably determined.
Section 1.13. Commitment Terminations. (a) Optional Revolving
Credit Terminations. The Borrower shall have the right at any time and from
time to time, upon 3 Business Days prior written notice to the Agent, to
terminate the Revolving Credit Commitments without premium or penalty and in
whole or in part, any partial termination to be (i) in an amount not less than
$1,000,000 and (ii) allocated ratably among the Banks in proportion to their
respective Revolver Percentages, provided that the Revolving Credit Commitments
may not be reduced to an amount less than the sum of the aggregate principal
amount of Revolving Loans and of L/C Obligations then outstanding. Any
termination of the Revolving Credit Commitments below $2,500,000 shall reduce
the L/C Commitment by a like amount. The Agent shall give prompt notice to
each Bank of any such termination of the Revolving Credit Commitments.
(b) Optional Term Credit Terminations. The Borrower shall have
the right at any time and from time to time, upon 3 Business Days prior written
notice to the Agent, to terminate the Term Credit Commitments without premium
or penalty and in whole or in part, any partial termination to be (i) in an
amount not less than $1,000,000 and (ii) allocated ratably among the Banks in
proportion the their respective Term Percentages. The Agent shall give prompt
notice to each Bank of any such termination of the Term Credit Commitments
(c) Mandatory Revolving Credit Terminations. On the date of
receipt thereof by the Borrower or any Subsidiary, the Revolving Credit
Commitments shall ratably terminate by an amount equal to 100% of the net cash
proceeds (i.e., gross proceeds of cash or cash equivalent minus reasonable
costs directly incurred and payable as a result thereof) of the incurrence
after the date of this Agreement of Indebtedness for Borrowed Money by the
Borrower or any Subsidiary (other than (x) the Loans hereunder and (y) such
other Indebtedness for Borrowed Money permitted by Section 8.13 hereof), it
being expressly understood and agreed that any such mandatory termination of
the Revolving Credit Commitments hereunder as a result of the foregoing shall
be in addition to any and all other rights and remedies that the Banks may have
as a result of any breach of the terms of Section 8.13 hereof.
(d) Mandatory Termination Upon a Change of Control. After the
occurrence of a Change of Control, the Required Banks may, by written notice to
the Borrower at any time on or before the date occurring 90 days after the date
the Borrower notifies the Banks of such Change of Control, terminate the
remaining Commitments and all other obligations of the Banks hereunder on the
date stated in such notice (which shall in no event be sooner than
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30 days after the occurrence of such Change of Control). On the date the
Commitments are so terminated, all outstanding Obligations (including, without
limitation, all principal of and accrued interest on the Notes) shall forthwith
be due and payable without further demand, presentment, protest, or notice of
any kind and the Borrower shall immediately pay to the Banks the full amount
then available for drawing under each Letter of Credit, such amount to be held
in the Account referred to in Section 9.4 hereof (the Borrower agreeing to
immediately make such payment on the date the Commitments are so terminated and
acknowledging and agreeing that the Banks would not have an adequate remedy at
law for the failure by the Borrower to honor any such demand and that the Banks,
and the Agent on their behalf, shall have the right to require the Borrower to
specifically perform such undertaking whether or not any drawings or other
demands for payment have been made under any of the Letters of Credit).
(e) Any termination of the Commitments pursuant to this Section
1.13 may not be reinstated.
SECTION 2. FEES, EXTENSIONS, AND SUBSTITUTION OF BANKS.
Section 2.1. Fees. (a) Revolving Credit Commitment Fee.
The Borrower shall pay to the Agent for the ratable account of the Banks in
accordance with their Revolver Percentages a commitment fee at the rate per
annum equal to the Applicable Margin (computed on the basis of a year of 360
days and the actual number of days elapsed) on the average daily Unused
Revolving Credit Commitments. Such commitment fee shall be payable
quarter-annually in arrears on the last day of each March, June, September and
December in each year (commencing March 31, 1998) and on the Revolving Credit
Termination Date, unless the Revolving Credit Commitments are terminated in
whole on an earlier date, in which event the commitment fee for the period to
the date of such termination in whole shall be paid on the date of such
termination.
(b) Term Credit Commitment Fee. The Borrower shall pay to the
Agent for the ratable account of the Banks in accordance with their Term
Percentages a commitment fee at the rate per annum equal to the Applicable
Margin (computed on the basis of a year of 360 days and the actual number of
days elapsed) on the average daily undrawn Term Credit Commitments. Such
commitment fee shall be payable quarter-annually in arrears on the last day of
each March, June, September and December in each year (commencing March 31,
1998) and on the Term Credit Termination Date, unless the Term Credit
Commitments are terminated in whole on an earlier date, in which event the
commitment fee for the period to the date of such termination in whole shall be
paid on the date of such termination.
(c) Letter of Credit Fees. On the date of issuance or extension,
or increase in the amount, of any Letter of Credit pursuant to Section 1.2
hereof, the Borrower shall pay to the Agent for its own account an issuance fee
equal to .25% per annum of the face amount of (or of the increase in the face
amount of) such Letter of Credit. Quarterly in arrears, on the last day of
each calendar quarter, commencing on March 31, 1998, the Borrower shall pay to
the Agent, for the ratable benefit of the Banks in accordance with their
Revolver Percentages, a letter of credit fee at a rate per annum equal to the
Applicable Margin (computed on the basis
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of a year of 360 days and the actual number of days elapsed) in effect during
each day of such quarter applied to the daily average face amount of Letters of
Credit outstanding during such quarter. In addition, the Borrower shall pay to
the Agent for its own account the Agent's standard drawing, negotiation,
amendment, and other administrative fees for each Letter of Credit. Such
standard fees referred to in the preceding sentence may be established by the
Agent from time to time.
(d) Agent Fees. The Borrower shall pay to the Agent the fees
agreed to between the Agent and the Borrower in a letter dated December 19,
1997 or as otherwise agreed between them.
(e) Audit Fees. The Borrower shall pay to the Agent for its own
use and benefit charges for audits of the Collateral performed by the Agent or
its agents or representatives in such amounts as the Agent may from time to
time request (the Agent acknowledging and agreeing that such charges shall be
computed in the same manner as it at the time customarily uses for the
assessment of charges for similar collateral audit and, in any event, not in
excess of $10,000 for any single audit); provided, however, that in the absence
of any Default and Event of Default, the Borrower shall not be required to pay
the Agent for more than (i) two (2) such audits during the initial 12 months of
this Agreement and (ii) one (1) such audit during each 12 month period ending
thereafter.
Section 2.2. Extensions of the Revolving Credit Termination
Date. No later than 90 days before the Revolving Credit Termination Date, the
Borrower may make a request for a one year extension of the Revolving Credit
Termination Date in a written notice to the Agent. The Agent will promptly
inform the Banks of any such request, and each Bank shall notify the Agent in
writing within 60 days following such request whether such Bank agrees to the
requested extension. If a Bank fails to so notify the Agent whether such Bank
agrees to such extension, such Bank shall be deemed to have refused to grant
the requested extension. Upon receipt by the Agent of the written consent of
all the Banks, the Revolving Credit Termination Date shall be automatically
extended an additional year. Otherwise, the Revolving Credit Termination Date
will remain as scheduled, at which time all Revolving Loans and all other
Obligations relating to the Revolving Credit shall be due and payable. In the
event any extension is granted hereunder, the Borrower shall, and shall cause
each Subsidiary to, execute and deliver such additional instruments and
documents as the Agent may reasonably deem necessary or appropriate to reflect
any such extension. All costs and expenses incurred by the Agent in connection
with each extension request (including reasonable attorneys' fees) shall be
paid by the Borrower in accordance with Section 12.15 hereof.
Section 2.3. Substitution of Banks. Upon the receipt by the
Borrower of (a) a claim from any Bank for compensation under Section 10.3 or
12.1 hereof, (b) notice by any Bank to the Borrower of any illegality pursuant
to Section 10.1 hereof or (c) notice from the Agent that a Bank or Banks have
not approved an extension of the Termination Date pursuant to Section 2.2
hereof, or in the event any Bank is in default in any material respect with
respect to its obligations under the Loan Documents (herein, a "Defaulting
Bank") (any such Bank referred to in clause (a), (b), or (c) above, or any such
Defaulting Bank, being hereinafter referred to as an "Affected Bank"), the
Borrower may, in addition to any other rights the
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Borrower may have hereunder or under applicable law, require, at its expense,
any such Affected Bank to assign, at par plus accrued interest and fees, without
recourse, all of its interest, rights and obligations hereunder (including all
of its Commitments and the Loans and participation interests in Letters of
Credit and other amounts at any time owing to it hereunder and the other Loan
Documents) to a bank or other institutional lender specified by the Borrower,
provided that (i) such assignment shall not conflict with or violate any law,
rule, or regulation or order of any court or other governmental authority, (ii)
the Borrower shall have received the written consent of the Agent, which consent
shall not be unreasonably withheld, to such assignment, (iii) the Borrower shall
have paid to the Affected Bank all monies other than such principal, interest,
and fees accrued and owing to it hereunder, and (iv) the assignment is entered
into in accordance with the other requirements of Section 12.12 hereof.
SECTION 3. PLACE AND APPLICATION OF PAYMENTS.
All payments of principal of and interest on the Loans and the
Reimbursement Obligations, and of all other Obligations payable by the Borrower
under this Agreement and the other Loan Documents, shall be made by the
Borrower to the Agent by no later than 12:00 Noon (Chicago time) on the due
date thereof at the office of the Agent in Chicago, Illinois (or such other
location in the State of Illinois as the Agent may designate to the Borrower)
for the benefit of the Bank or Banks entitled thereto. Any payments received
after such time shall be deemed to have been received by the Agent on the next
Business Day. All such payments shall be made in U.S. Dollars, in immediately
available funds at the place of payment, in each case without set-off or
counterclaim. The Agent will promptly thereafter cause to be distributed like
funds relating to the payment of principal or interest on Loans and on
Reimbursement Obligations in which the Banks have purchased Participating
Interests ratably to the Banks and like funds relating to the payment of any
other amount payable to any Bank to such Bank, in each case to be applied in
accordance with the terms of this Agreement.
Anything contained herein to the contrary notwithstanding, all
payments and collections received in respect of the Obligations and all
proceeds of the Collateral received, in each instance, by the Agent or any of
the Banks after the occurrence and during the continuation of an Event of
Default shall be remitted to the Agent and distributed as follows:
(a) first, to the payment of any outstanding costs and
expenses reasonably incurred by the Agent, and any security trustee
therefor, in monitoring, verifying, protecting, preserving or
enforcing the Liens on the Collateral or by the Agent, and any
security trustee therefor, in protecting, preserving or enforcing
rights under the Loan Documents, and in any event all costs and
expenses of a character which the Borrower has agreed to pay the Agent
under Section 12.15 hereof (such funds to be retained by the Agent for
its own account unless it has previously been reimbursed for such
costs and expenses by the Banks, in which event such amounts shall be
remitted to the Banks to reimburse them for payments theretofore made
to the Agent);
(b) second, to the payment of any outstanding interest or
other fees or amounts due under the Notes and the other Loan Documents
(including amounts owing to the Banks or the Floating Rate Payor under
Section 1.12 hereof), in each case other than for
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principal on the Loans or in reimbursement or collateralization
of L/C Obligations, pro rata as among the Agent and the Banks in accord
with the amount of such interest and other fees or amounts owing each;
(c) third, to the payment of the principal of the Notes
and any unpaid Reimbursement Obligations and to the Agent to be held
as collateral security for any other L/C Obligations (until the Agent
is holding an amount of cash equal to the then outstanding amount of
all such L/C Obligations), the aggregate amount paid to or held as
collateral security for the Banks to be allocated pro rata as among
the Banks in accord with the aggregate unpaid principal balances of
their Loans and interests in the Letters of Credit;
(d) fourth, to the Agent and the Banks ratably in
accordance with the amounts of any other indebtedness, obligations or
liabilities of the Borrower and its Subsidiaries owing to each of them
and secured by the Collateral Documents (other than for Hedging
Liability described in subsection (e) below), unless and until all
such indebtedness, obligations and liabilities have been fully paid
and satisfied;
(e) fifth, to the payment of the Hedging Liability (if
any) pro rata as among the Banks to whom such Hedging Liability is
owed in accordance with the then respective unpaid amounts of such
liability; and
(f) sixth, to the Borrower or whoever else may be
lawfully entitled thereto.
SECTION 4. COLLATERAL AND GUARANTIES.
Section 4.1. Collateral. The Obligations shall be secured by
(a) valid, perfected, and enforceable Liens on all right, title, and interest
of the Borrower and each Material Subsidiary in all capital stock or other
equity interests held by such Person in each of its Subsidiaries, whether now
owned or hereafter formed or acquired, and all proceeds thereof, and (b) valid,
perfected (subject to the proviso appearing at the end of this sentence) and
enforceable Liens on all right, title, and interest of the Borrower and each
Material Subsidiary in all accounts and account receivables, notes and note
receivables, contract rights, instruments, documents, chattel paper, general
intangibles (including, without limitation, patents, trademarks, tradenames,
copyrights, and other intellectual property rights), investment property,
deposit accounts, inventory, machinery and equipment, and real estate, whether
now owned or hereafter acquired or arising, and all proceeds thereof; provided,
however, that: (i) until the Agent or the Required Banks require otherwise,
Liens on real estate need not be granted and Liens on intellectual property
rights need not be filed with the United States Patent and Trademark Office or
the United States Copyright Office, (ii) the Lien of the Agent on Property
subject to a Capital Lease or conditional sale agreement or subject to a
purchase money lien in each instance permitted hereby shall be subject to the
rights of the lessor or lender thereunder, (iii) until an Event of Default has
occurred and is continuing and thereafter until otherwise required by the Agent
or the Required Banks, Liens on deposit accounts maintained by the Borrower or
any Material Subsidiary in proximity to its operations for the purpose of
paying amounts owing (as opposed to receiving collections of the Collateral as
provided in
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Section 4.2 below), Liens on note receivables, and Liens on vehicles which are
subject to a certificate of title law need not be perfected provided that the
total value of such property at any one time not so perfected does not exceed
$500,000 in the aggregate, (iv) until an Event of Default has occurred and is
continuing and thereafter until otherwise required by the Agent or the Required
Banks, no Lien need be granted upon the capital stock of Block Vision of Texas,
Inc., so long as the Borrower is in compliance with Section 8.28 hereof. The
Borrower acknowledges and agrees that the Liens on the Collateral shall be
granted to the Agent for the benefit of itself and the Banks and shall be valid
and perfected first priority Liens subject, however, to the proviso appearing at
the end of the immediately preceding sentence, in each case pursuant to one or
more Collateral Documents from such Persons, each in form and substance
satisfactory to the Agent.
Section 4.2 Collections. The Borrower shall promptly, but in
any event within 30 days of the date of this Agreement, make such arrangements
as shall be necessary or appropriate to assure that all proceeds of the
Collateral of the Borrower and its Material Subsidiaries are deposited (in the
same form as received) in accounts maintained with, or under the dominion and
control of, the Agent, such accounts to constitute special restricted accounts,
the Borrower acknowledging that the Agent has (and is hereby granted) a lien on
such accounts and all funds contained therein to secure the Obligations. If
and to the extent that proceeds are deposited in accounts maintained with
financial institutions other than the Agent, it shall be a condition to the
Borrower's or any Material Subsidiary's right to so effect such deposits more
than 30 days after the date hereof that the financial institutions maintaining
such accounts have delivered to the Agent blocked account agreements
satisfactory to the Agent in form and substance pursuant to which such
financial institutions acknowledge the Agent's Lien thereon, waive any right of
offset or bankers' liens thereon (other than with respect to account
maintenance charges and returned items) and agree that the collected balances
in such accounts will only be transferred to the Agent. The Banks agree with
the Borrower that if and so long as no Default or Event of Default has occurred
or is continuing, amounts on deposit in the accounts maintained with the Agent
will (subject to the rules and regulations of the Agent as from time to time in
effect applicable to demand deposit accounts) be made available to the Borrower
and its Material Subsidiaries for use in the conduct of their business. Upon
the occurrence of an Event of Default, the Agent may apply the funds on deposit
in such accounts to the Obligations.
Section 4.3. Guaranties. The payment and performance of the
Obligations shall at all times be guaranteed by each direct and indirect
Material Subsidiary of the Borrower pursuant to one or more guaranty agreements
in form and substance acceptable to the Agent, as the same may be amended,
modified or supplemented from time to time (individually a "Guaranty" and
collectively the "Guaranties").
Section 4.4. Further Assurances. The Borrower agrees that it
shall, and shall cause each Material Subsidiary to, from time to time at the
request of the Agent or the Required Banks, execute and deliver such documents
and do such acts and things as the Agent or the Required Banks may reasonably
request in order to provide for or perfect or protect such Liens on the
Collateral. In the event any Subsidiary hereinafter becomes a Material
Subsidiary or the Borrower or any Material Subsidiary forms or acquires any
other Material Subsidiary after
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the date hereof, the Borrower shall within 10 Business Days of such event,
formation or acquisition cause such newly formed or acquired or existing
Material Subsidiary to execute a Guaranty and such Collateral Documents as the
Agent may then require, and the Borrower shall also deliver to the Agent, or
cause such Material Subsidiary to deliver to the Agent, at the Borrower's cost
and expense, such other instruments, documents, certificates, and opinions
reasonably required by the Agent in connection therewith.
Section 4.5. Liens on After-Acquired Real Property. In the
event that the Borrower or any Material Subsidiary owns or hereafter acquires
any real property, at the request of the Agent or the Required Banks pursuant
to the terms of Section 4.1 above, the Borrower shall, or shall cause such
Material Subsidiary to, execute and deliver to the Agent (or a security trustee
therefor) a mortgage or deed of trust acceptable in form and substance to the
Agent for the purpose of granting to the Agent for the benefit of the Banks a
lien on such real property to secure the Obligations, shall pay all taxes,
costs and expenses incurred by the Agent in recording such mortgage or deed of
trust, and shall at its expense supply to the Agent a survey and a mortgagee's
policy of title insurance from a title insurer reasonably acceptable to the
Agent insuring the validity of such mortgage or deed of trust and its status as
a first lien (subject to liens permitted by this Agreement) on the real
property encumbered thereby.
SECTION 5. DEFINITIONS; INTERPRETATION.
Section 5.1. Definitions. The following terms when used herein
shall have the following meanings:
"Account" is defined in Section 9.4 hereof.
"Acquired Business" means the entity or assets acquired by the
Borrower or a Subsidiary in an Acquisition, whether before or after the date
hereof.
"Acquisition" means any transaction or series of related transactions
for the purpose of or resulting, directly or indirectly, in (a) the acquisition
of all or substantially all of the assets of a Person, or of any business or
division of a Person, (b) the acquisition of in excess of 50% of the capital
stock, partnership interests, membership interests or equity of any Person, or
otherwise causing any Person to become a Subsidiary, or (c) a merger or
consolidation or any other combination with another Person (other than a Person
that is a Subsidiary) provided that the Borrower or the Subsidiary is the
surviving entity.
"Acquisition EBITDA" means, with reference to any period and any
Acquired Business of a Target, the total net income (as determined in
accordance with GAAP) of such Target arising out of the Acquired Business plus
the sum of all amounts deducted in arriving at such net income amount in
respect of (x) interest expense for such period, (y) federal, state, and local
income taxes for such period, and (z) depreciation of fixed assets and
amortization of intangible assets for such period and adjusted for shareholder
expenses (including professional compensation), non-recurring expenses and
reasonably anticipated revenues due to new business or new locations of the
Acquired Business (based on year-to-date historical performance of such new
business or new locations), such adjustments to be reasonably
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determined by the Borrower in good faith and established to the reasonably
satisfaction of the Agent.
"Adjusted EBITDA" means, with reference to any period, EBITDA for such
period calculated on a pro forma basis, in accordance with the balance sheets,
income statements and other related financial statements furnished to the Agent
and the Banks pursuant to Section 8.15(k) hereof, as if each acquisition
permitted by Section 8.15(k) hereof occurring during such period had taken
place on the first day of such period.
"Adjusted LIBOR" is defined in Section 1.4(b) hereof.
"Affiliate" means any Person directly or indirectly controlling or
controlled by, or under direct or indirect common control with, another Person.
A Person shall be deemed to control another Person for the purposes of this
definition if such Person possesses, directly or indirectly, the power to
direct, or cause the direction of, the management and policies of the other
Person, whether through the ownership of voting securities, common directors,
trustees or officers, by contract or otherwise; provided that, in any event for
purposes of this definition, any Person that owns, directly or indirectly, 5%
or more of the securities having the ordinary voting power for the election of
directors or governing body of a corporation or 5% or more of the partnership
or other ownership interest of any other Person (other than as a limited
partner of such other Person) will be deemed to control such corporation or
other Person.
"Agent" means Bank of Montreal, and any successor pursuant to Section
11.7 hereof.
"Applicable Margin" means, with respect to Loans, Reimbursement
Obligations, and the commitment fees and letter of credit fees payable under
Section 2.1 hereof, the rate per annum specified below:
Applicable Margin for Base Rate Loans and Reimbursement Obligations: 1.0%
Applicable Margin for Eurodollar Loans: 2.5%
Applicable Margin for Revolving Credit commitment fee and Term Credit
commitment fee: .375%
Applicable Margin for letter of credit fee: 2.5%
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; provided, however, that the Applicable Margin shall be subject to quarterly
adjustments on the first Pricing Date, and thereafter from one Pricing Date to
the next the Applicable Margin shall mean a rate per annum determined in
accordance with the following schedule:
APPLICABLE MARGIN FOR
TOTAL FUNDED APPLICABLE MARGIN FOR THE REVOLVING CREDIT
DEBT/ADJUSTED EBITDA THE BASE RATE LOANS AND APPLICABLE MARGIN FOR COMMITMENT FEE AND APPLICABLE MARGIN FOR
RATIO REIMBURSEMENT EURODOLLAR LOANS SHALL TERM CREDIT COMMITMENT THE LETTER OF CREDIT
FOR SUCH PRICING DATE OBLIGATIONS SHALL BE: BE FEE SHALL BE FEE SHALL BE
Greater than 3.25 to 1.5% 3.0% .50% 3.0%
1.0
Equal to or less than 1.375% 2.875% .50% 2.875%
3.25 to 1.0, but
greater than 2.5 to 1.0
Equal to or less than 1.125% 2.625% .50% 2.625%
2.5 to 1.0, but greater
than 2.0 to 1.0
Equal to or less than 1.0% 2.5% .375% 2.5%
2.0 to 1.0, but greater
than 1.5 to 1.0
Equal to or less than .75% 2.25% .25% 2.25%
1.5 to 1.0, but greater
than 1.0 to 1.0
Equal to or less than .50% 2.0% .25% 2.0%
1.0 to 1.0
For purposes hereof, the term "Pricing Date" means, for any fiscal quarter of
the Borrower ending on or after March 31, 1998, the date on which the Agent is
in receipt of the Borrower's most recent financial statements for the fiscal
quarter then ended, pursuant to Section 8.5(b) or (c) hereof. The Applicable
Margin shall be established based on the Total Funded Debt/Adjusted EBITDA
Ratio for the most recently completed fiscal quarter and the Applicable Margin
established on a Pricing Date shall remain in effect until the next Pricing
Date. If the Borrower has not delivered its financial statements by the date
such financial statements (and, in the case of the year-end financial
statements, audit report) are required to be delivered under Section 8.5(b) or
(c) hereof, until such financial statements and audit report are delivered, the
Applicable Margin shall be the highest Applicable Margin (i.e., the Total
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Funded Debt/Adjusted EBITDA Ratio shall be deemed to be greater than 3.25 to
1.0). If the Borrower subsequently delivers such financial statements before
the next Pricing Date, the Applicable Margin established by such late delivered
financial statements shall take effect from the date of delivery until the next
Pricing Date. In all other circumstances, the Applicable Margin established by
such financial statements shall be in effect from the Pricing Date that occurs
immediately after the end of the Borrower's fiscal quarter covered by such
financial statements until the next Pricing Date. Each determination of the
Applicable Margin made by the Agent in accordance with the foregoing shall be
conclusive and binding on the Borrower and the Banks if reasonably determined.
"Application" is defined in Section 1.2(b) hereof.
"Authorized Representative" means those persons shown on the list of
officers provided by the Borrower pursuant to Section 7.1(f) hereof or on any
update of any such list provided by the Borrower to the Agent, or any further
or different officer of the Borrower so named by any Authorized Representative
of the Borrower in a written notice to the Agent.
"Bank" is defined in the introductory paragraph of this Agreement and
includes each assignee bank pursuant to Section 12.12 hereof.
"Base Rate" is defined in Section 1.4(a) hereof.
"Base Rate Loan" means a Loan bearing interest at a rate specified in
Section 1.4(a) hereof.
"Borrower" is defined in the introductory paragraph of this Agreement.
"Borrowing" means the total of Loans of a single type advanced,
continued for an additional Interest Period, or converted from a different type
into such type by the Banks under a Credit on a single date and, in the case of
Eurodollar Loans, for a single Interest Period. Borrowings of Loans are made and
maintained ratably from each of the Banks under a Credit according to their
Percentages of such Credit. A Borrowing is "advanced" on the day Banks advance
funds comprising such Borrowing to the Borrower, is "continued" on the date a
new Interest Period for the same type of Loans commences for such Borrowing, and
is "converted" when such Borrowing is changed from one type of Loans to the
other, all as requested by the Borrower pursuant to Section 1.6(a).
"Business Day" means any day (other than a Saturday or Sunday) on
which banks are not authorized or required to close in Chicago, Illinois and,
if the applicable Business Day relates to the advance or continuation of, or
conversion into, or payment of a Eurodollar Loan, on which banks are dealing in
U.S. Dollar deposits in the interbank eurodollar market in London, England.
"Capital Expenditures" means, with respect to any Person for any
period, the aggregate amount of all expenditures (whether paid in cash or
accrued as a liability) by such Person during that period which, in accordance
with GAAP, are or should be included as "additions to
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property, plant or equipment" or similar items reflected in the statement of
cash flows of such Person, provided Capital Expenditures shall not include
amounts paid by the Borrower or any of its Subsidiaries for the assets or
business of a Target pursuant to an Acquisition permitted by this Agreement.
"Capital Lease" means any lease of Property which in accordance with
GAAP is required to be capitalized on the balance sheet of the lessee.
"Capitalized Lease Obligation" means, for any Person, the amount of
the liability shown on the balance sheet of such Person in respect of a Capital
Lease determined in accordance with GAAP.
"Change of Control" means any of (a) the acquisition by any "person"
or "group" (as such terms are used in sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended) (other than ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇)
at any time of beneficial ownership of 40% or more of the outstanding capital
stock of the Borrower on a fully-diluted basis, (b) the failure of individuals
who are members of the board of directors of the Borrower on the date of this
Agreement (together with any new or replacement directors whose initial
nomination for election was approved by a majority of the directors who were
either directors on the date of this Agreement or previously so approved) to
constitute a majority of the board of directors of the Borrower, or (c) the
failure of ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ to own and control at least 1,000,000 shares of
the Voting Stock of the Borrower.
"Code" means the Internal Revenue Code of 1986, as amended, and any
successor statute thereto.
"Collateral" means all properties, rights, interests and privileges
from time to time subject to the Liens granted to the Agent, or any security
trustee therefor, by the Collateral Documents.
"Collateral Documents" means the Security Agreement, the Pledge
Agreement, and all other mortgages, deeds of trust, security agreements, pledge
agreements, assignments, financing statements and other documents as shall from
time to time secure or relate to the Obligations or any part thereof.
"Commitments" means the Revolving Credit Commitments, the L/C
Commitment, and the Term Credit Commitments.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Borrower or any Subsidiary, are treated
as a single employer under Section 414 of the Code.
"Credit" means either the Revolving Credit or the Term Credit.
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"Credit Event" means the advancing of any Loan, the continuation of or
conversion into a Eurodollar Loan, or the issuance of, or extension of the
expiration date or increase in the amount of, any Letter of Credit.
"Current Ratio" means, at any time the same is to be determined, the
ratio of (a) current assets of the Borrower and its Subsidiaries at such time
to (b) current liabilities of the Borrower and its Subsidiaries at such time,
current assets and current liabilities each to be computed on a consolidated
basis in accordance with GAAP.
"Default" means any event or condition the occurrence of which would,
with the passage of time or the giving of notice, or both, constitute an Event
of Default.
"EBITDA" means, with reference to any period, Net Income for such
period plus the sum (without duplication) of all amounts deducted in arriving
at such Net Income amount in respect of (w) Interest Expense for such period,
(x) federal, state and local income taxes for such period, (y) depreciation of
fixed assets and amortization of intangible assets for such period, and (z)
one-time charges incurred on or about the date of this Agreement arising out of
the prepayment of the indebtedness owing to Prudential Securities Credit
Corporation referred to in Section 1.3(a) above.
"Eligible Line of Business" means any business engaged in as of the
date of this Agreement by the Borrower or any Subsidiary existing as of the
date of this Agreement (including the Borrower) and any other business
activities reasonably related thereto in the healthcare industry.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor statute thereto.
"Eurodollar Loan" means a Loan bearing interest at the rate specified
in Section 1.4(b) hereof.
"Eurodollar Reserve Percentage" is defined in Section 1.4(b) hereof.
"Event of Default" means any event or condition identified as such in
Section 9.1 hereof.
"Federal Funds Rate" means the fluctuating interest rate per annum
described in part (x) of clause (ii) of the definition of Base Rate appearing in
Section 1.4(a) hereof.
"Fixed Rate Loan" means a Term Loan bearing interest at the rate
determined pursuant to Section 1.4(c) hereof.
"Fixed Rate" is defined in Section 1.4(c) hereof.
"Floating Rate Payor" is defined in Section 1.4(c) hereof.
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"GAAP" means generally accepted accounting principles set forth from
time to time in the opinions and pronouncements of the Accounting Principles
Board and the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable statute and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date of
determination.
"Hedging Liability" means the liability of the Borrower to any of the
Banks in respect of any interest rate swaps, interest rate caps, interest rate
collars, or other interest rate hedging arrangements as the Borrower may from
time to time enter into with any one or more of the Banks party to this
Agreement. Unless and until the amount of the Hedging Liability is fixed and
determined, the Hedging Liability shall be deemed to be 4% per annum of the
notional amount of the hedge from the date of computation to the date the hedge
expires.
"Hostile Acquisition" means the acquisition of the capital stock or
other equity interests of a Person through a tender offer or similar
solicitation of the owners of such capital stock or other equity interests
which has not been approved (prior to such acquisition) by resolutions of the
Board of Directors of such Person or by similar action if such Person is not a
corporation, and as to which such approval has not been withdrawn.
"Indebtedness for Borrowed Money" means for any Person (without
duplication and, with respect to the Borrower and its Subsidiaries, on a
consolidated basis) (i) all indebtedness created, assumed or incurred in any
manner by such Person representing money borrowed (including by the issuance of
debt securities), (ii) all indebtedness for the deferred purchase price of
property or services (other than trade accounts payable arising in the ordinary
course of business), (iii) all indebtedness secured by any Lien upon Property
of such Person, whether or not such Person has assumed or become liable for the
payment of such indebtedness, (iv) all Capitalized Lease Obligations of such
Person and (v) all obligations of such Person on or with respect to letters of
credit, bankers' acceptances and other extensions of credit whether or not
representing obligations for borrowed money, but in any event not including
rentals due under operating leases.
"Interest Expense" means, with reference to any period, the sum of all
interest charges (including imputed interest charges with respect to
Capitalized Lease Obligations and all amortization of debt discount and
expense) of the Borrower and its Subsidiaries for such period determined on a
consolidated basis in accordance with GAAP, but not including interest charges
incurred prior to the date of this Agreement arising out of the indebtedness
owing to Prudential Securities Credit Corporation referred to in Section 1.3(a)
above.
"Interest Period" is defined in Section 1.7 hereof.
"L/C Commitment" means $2,500,000, as reduced pursuant to
Section 1.13(a) hereof.
"L/C Obligations" means the aggregate undrawn face amounts of all
outstanding Letters of Credit and all unpaid Reimbursement Obligations.
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"Lending Office" is defined in Section 10.4 hereof.
"Letter of Credit" is defined in Section 1.2(a) hereof.
"LIBOR" is defined in Section 1.4(b) hereof.
"Lien" means any mortgage, lien, security interest, pledge, charge or
encumbrance of any kind in respect of any Property, including the interests of
a vendor or lessor under any conditional sale, Capital Lease or other title
retention arrangement.
"Loan" means a Base Rate Loan or Eurodollar Loan or Fixed Rate Loan,
each of which is a "type" of Loan hereunder, outstanding as a Revolving Loan or
Term Loan, as applicable.
"Loan Documents" means this Agreement, the Notes, the Applications,
the Collateral Documents, the Guaranties, and each other instrument or document
to be delivered hereunder or thereunder or otherwise in connection therewith.
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, condition
(financial or otherwise) or prospects of the Borrower, or the Borrower and its
Subsidiaries taken as a whole; (b) a material impairment of the ability of the
Borrower or any Subsidiary to perform its obligations under any Loan Document;
or (c) a material adverse effect upon the legality, validity, binding effect or
enforceability against the Borrower or any Subsidiary of any Loan Document.
"Material Subsidiary" means each Subsidiary, other than (a) so long as
the Borrower is in compliance with Section 8.28 hereof, Block Vision of Texas,
Inc. and (b) any Subsidiary that does not engage in any significant business
activity or own any asset or assets (including the capital stock of another
Person) with a fair market value in excess of $1,000 or generate revenues in
excess of $1,000 annually and does not have any Subsidiary other than an
inactive subsidiary (within the meaning of this clause (b).
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Net Income" means, with reference to any period, the net income (or
net loss) of the Borrower and its Subsidiaries for such period computed on a
consolidated basis in accordance with GAAP.
"Net Worth" means, at any time the same is to be determined, total
shareholder's equity (including capital stock, additional paid-in capital and
retained earnings after deducting treasury stock) which would appear on the
balance sheet of the Borrower and its Subsidiaries prepared on a consolidated
basis in accordance with GAAP.
"Notes" means and includes the Revolving Notes and the Term Notes.
"Obligations" means all fees payable hereunder, all obligations of the
Borrower to pay principal and interest on Loans and Reimbursement Obligations,
and all other payment
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obligations of the Borrower or any Subsidiary arising under or in relation to
any Loan Document, in each case whether now existing or hereafter arising.
"Participating Bank" is defined in Section 1.2(d) hereof.
"Participating Interest" is defined in Section 1.2(d) hereof.
"PBGC" means the Pension Benefit Guaranty Corporation or any Person
succeeding to any or all of its functions under ERISA.
"Percentage" means for any Bank its Revolver Percentage or Term
Percentage.
"Permitted Acquisition" means an Acquisition with respect to which all
of the following conditions shall have been satisfied:
(a) the Acquired Business is an Eligible Line of
Business, the Target of the Acquisition is a professional association
of ophthalmologists and/or optometrists and is not a practice
management firm, and the Acquisition consists of the purchase by the
Borrower or a Subsidiary of the "business assets" from such Target
concurrently with the Borrower or such Subsidiary entering into a
long-term management agreement with such Target to provide management
and administrative services to such Target on a fee basis;
(b) the Acquisition shall not be a Hostile Acquisition;
(c) the financial statements of the Acquired Business
shall have been audited by one of the "Big Six" accounting firms or by
another independent accounting firm of national or regional repute or
such accountants are otherwise reasonably satisfactory to the Agent,
or if such financial statements have not been audited by such an
accounting firm, such financial statements shall have been approved as
to form and substance to the reasonable satisfaction of the Agent;
(d) the Total Consideration paid for the Target shall not
exceed 7.0 times the Acquisition EBITDA of the Acquired Business for
the four fiscal quarter period immediately preceding the date of the
Acquisition;
(e) of the Total Consideration paid for the Target, not
less than 40% thereof shall consist of equity securities of the
Borrower; and
(f) after giving effect to the Acquisition, no Default or
Event of Default shall exist, including with respect to the covenants
contained in Section 8 on a pro forma basis.
"Person" means an individual, partnership, corporation, limited
liability company, association, trust, unincorporated organization or any other
entity or organization, including a government or agency or political
subdivision thereof.
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"Plan" means any employee pension benefit plan covered by Title IV of
ERISA or subject to the minimum funding standards under Section 412 of the Code
that either (i) is maintained by a member of the Controlled Group for employees
of a member of the Controlled Group or (ii) is maintained pursuant to a
collective bargaining agreement or any other arrangement under which more than
one employer makes contributions and to which a member of the Controlled Group
is then making or accruing an obligation to make contributions or has within
the preceding five plan years made contributions.
"Pledge Agreement" means that certain Pledge Agreement dated of even
date herewith among the Borrower, certain of its Subsidiaries, and the Agent,
as the same may be amended, modified or restated from time to time.
"Property" means any interest in any kind of property or asset,
whether real, personal or mixed, or tangible or intangible.
"Reimbursement Obligation" is defined in Section 1.2(c) hereof.
"Required Banks" means, as of the date of determination thereof, Banks
holding more than 50% of the sum of the Revolver Percentages and the Term
Percentages.
"Revolving Credit" means the credit facility for making Revolving
Loans and issuing Letters of Credit described in Sections 1.1 and 1.2 hereof.
"Revolver Percentage" means, for each Bank, the percentage of the
Revolving Credit Commitments represented by such Bank's Revolving Credit
Commitment or, if the Revolving Credit Commitments have been terminated, the
percentage held by such Bank (including through participation interests in
Reimbursement Obligations) of the aggregate principal amount of all Revolving
Loans and L/C Obligations then outstanding.
"Revolving Credit Commitment" is defined in Section 1.1 hereof.
"Revolving Credit Termination Date" means January 30, 2003, or such
later date to which the same may be extended pursuant to Section 2.2 hereof, or
such earlier date on which the Revolving Credit Commitments are terminated in
whole pursuant to Section 1.13, 9.2 or 9.3 hereof.
"Revolving Loan" is defined in Section 1.1 hereof and, as so defined,
includes a Base Rate Loan or a Eurodollar Loan, each of which is a "type" of
Revolving Loan hereunder.
"Revolving Note" is defined in Section 1.11(a) hereof.
"S&P" means Standard & Poor's Ratings Services Group, a division of
The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
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"Security Agreement" means that certain Security Agreement dated of
even date herewith among the Borrower, certain of its Subsidiaries, and the
Agent, as the same may be amended, modified or restated from time to time.
"subsidiary" means, as to any particular parent corporation or
organization, any other corporation or organization more than 50% of the
outstanding Voting Stock of which is at the time directly or indirectly owned by
such parent corporation or organization or by any one or more other entities
which are themselves subsidiaries of such parent corporation or organization.
The term "Subsidiary" means a subsidiary of the Borrower or of any of its direct
or indirect Subsidiaries.
"Target" means the Persons whose assets or equity interests are the
subject of an Acquisition.
"Term Credit" means the credit facility for Term Loan described in
Section 1.3 hereof.
"Term Credit Commitment" is defined in Section 1.3 hereof.
"Term Loan" is defined in Section 1.3 hereof and, as so defined,
includes a Base Rate Loan or a Eurodollar Loan or a Fixed Rate Loan, each of
which is a "type" of Term Loan hereunder.
"Term Credit Final Maturity Date" means January 30, 2003.
"Term Credit Termination Date" means January 30, 2000, or such earlier
date on which the Term Credit Commitments are terminated in whole pursuant to
section 1.12, 9.2, or 9.3 hereof.
"Term Note" is defined in Section 1.11(b) hereof.
"Term Percentage" means, for each Bank, the percentage of the Term
Credit Commitments represented by such Bank's Term Credit Commitment or, if the
Term Credit Commitments have been terminated or have expired, the percentage
held by such Bank of the aggregate principal amount of all Term Loans then
outstanding.
"Total Consideration" means the total amount (but without duplication)
of (a) cash paid in connection with any Acquisition, plus (b) indebtedness
payable to the seller in connection with such Acquisition, plus (c) the fair
market value of any equity securities, including any warrants or options
therefor, delivered in connection with any Acquisition, plus (d) the present
value of covenants not to compete entered into in connection with such
Acquisition or other future payments which are required to be made over a
period of time and are not contingent upon the Borrower or its Subsidiary
meeting financial performance objectives (discounted at the Base Rate), but
only to the extent not included in clause (a), (b), or (c) above, plus (e) the
amount of indebtedness assumed in connection with such Acquisition.
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"Total Funded Debt" means, at any time the same is to be determined,
the aggregate of all Indebtedness for Borrowed Money of the Borrower and its
Subsidiaries at such time, including all Indebtedness for Borrowed Money of any
other Person which is directly or indirectly guaranteed by the Borrower or any
of its Subsidiaries or which the Borrower or any of its Subsidiaries has agreed
(contingently or otherwise) to purchase or otherwise acquire or in respect of
which the Borrower or any of its Subsidiaries has otherwise assured a creditor
against loss.
"Total Funded Debt/Adjusted EBITDA Ratio" means, as of the last day of
any fiscal quarter of the Borrower, the ratio of (a) the Total Funded Debt of
the Borrower and its Subsidiaries as of the last day of such fiscal quarter to
(b) Adjusted EBITDA for the period of four fiscal quarters then ended.
"Unfunded Vested Liabilities" means, for any Plan at any time, the
amount (if any) by which the present value of all vested nonforfeitable accrued
benefits under such Plan exceeds the fair market value of all Plan assets
allocable to such benefits, all determined as of the then most recent valuation
date for such Plan, but only to the extent that such excess represents a
potential liability of a member of the Controlled Group to the PBGC or the Plan
under Title IV of ERISA.
"U.S. Dollars" and "$" each means the lawful currency of the United
States of America.
"Unused Revolving Credit Commitments" means, at any time, the
difference between the Revolving Credit Commitments then in effect and the
aggregate outstanding principal amount of Revolving Loans and L/C Obligations.
"Voting Stock" of any Person means capital stock or other equity
interests of any class or classes (however designated) having ordinary power for
the election of directors or other similar governing body of such Person, other
than stock or other equity interests having such power only by reason of the
happening of a contingency.
"Welfare Plan" means a "welfare plan" as defined in Section 3(1) of
ERISA.
"Wholly-owned Subsidiary" means a Subsidiary of which all of the
issued and outstanding shares of capital stock (other than directors'
qualifying shares as required by law) or other equity interests are owned by
the Borrower and/or one or more Wholly-owned Subsidiaries within the meaning of
this definition.
Section 5.2. Interpretation. The foregoing definitions are
equally applicable to both the singular and plural forms of the terms defined.
The words "hereof", "herein", and "hereunder" and words of like import when
used in this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement. All references to time of day herein
are references to Chicago, Illinois time unless otherwise specifically
provided. Where the character or amount of any asset or liability or item of
income or expense is required to be determined or any consolidation or other
accounting computation is
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required to be made for the purposes of this Agreement, it shall be done in
accordance with GAAP except where such principles are inconsistent with the
specific provisions of this Agreement.
Section 5.3. Change in Accounting Principles. If, after the
date of this Agreement, there shall occur any change in GAAP from those used in
the preparation of the financial statements referred to in Section 6.5 hereof
and such change shall result in a change in the method of calculation of any
financial covenant, standard or term found in this Agreement, either the
Borrower or the Required Banks may by notice to the Banks and the Borrower,
respectively, require that the Banks and the Borrower negotiate in good faith
to amend such covenants, standards, and term so as equitably to reflect such
change in accounting principles, with the desired result being that the
criteria for evaluating the financial condition of the Borrower and its
Subsidiaries shall be the same as if such change had not been made. No delay
by the Borrower or the Required Banks in requiring such negotiation shall limit
their right to so require such a negotiation at any time after such a change in
accounting principles. Until any such covenant, standard, or term is amended
in accordance with this Section 5.3, financial covenants shall be computed and
determined in accordance with GAAP in effect prior to such change in accounting
principles. Without limiting the generality of the foregoing, the Borrower
shall neither be deemed to be in compliance with any financial covenant
hereunder nor out of compliance with any financial covenant hereunder if such
state of compliance or noncompliance, as the case may be, would not exist but
for the occurrence of a change in accounting principles after the date hereof.
SECTION 6. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to the Agent and the Banks as
follows:
Section 6.1. Organization and Qualification. The Borrower is
duly organized, validly existing and in good standing as a corporation under
the laws of the state of its incorporation, has full and adequate corporate
power to own its Property and conduct its business as now conducted, and is
duly licensed or qualified and in good standing in each jurisdiction in which
the nature of the business conducted by it or the nature of the Property owned
or leased by it requires such licensing or qualifying, except where the failure
to do so would not have a Material Adverse Effect.
Section 6.2. Subsidiaries. Each Subsidiary is duly organized,
validly existing and in good standing under the laws of the jurisdiction in
which it is incorporated or organized, as the case may be, has full and
adequate power to own its Property and conduct its business as now conducted,
and is duly licensed or qualified and in good standing in each jurisdiction in
which the nature of the business conducted by it or the nature of the Property
owned or leased by it requires such licensing or qualifying, except where the
failure to do so would not have a Material Adverse Effect. Schedule 6.2 hereto
(as the same may be deemed amended pursuant to Section 8.16(c) or 8.23 hereof)
identifies each Subsidiary, the jurisdiction of its incorporation or
organization, as the case may be, the percentage of issued and outstanding
shares of each class of its capital stock or other equity interests owned by
the Borrower and the other Subsidiaries and, if such percentage is not 100%
(excluding directors' qualifying shares
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as required by law), a description of each class of its authorized capital stock
and other equity interests and the number of shares of each class issued and
outstanding. All of the outstanding shares of capital stock and other equity
interests of each Subsidiary are validly issued and outstanding and fully paid
and nonassessable and all such shares and other equity interests indicated on
Schedule 6.2 (as the same may be deemed amended pursuant to Section 8.16(c) or
8.23 hereof) as owned by the Borrower or a Subsidiary are owned, beneficially
and of record, by the Borrower or such Subsidiary free and clear of all Liens
other than the Liens granted in favor of the Agent pursuant to the Collateral
Documents. There are no outstanding commitments or other obligations of any
Subsidiary to issue, and no options, warrants or other rights of any Person to
acquire, any shares of any class of capital stock or other equity interests of
any Subsidiary.
Section 6.3. Authority and Validity of Obligations. The
Borrower has full right and authority to enter into this Agreement and the
other Loan Documents executed by it, to make the borrowings herein provided
for, to issue its Notes in evidence thereof, to grant to the Agent the Liens
described in the Collateral Documents executed by the Borrower, and to perform
all of its obligations hereunder and under the other Loan Documents executed by
it. Each Material Subsidiary has full right and authority to enter into the
Loan Documents executed by it, to guarantee the Obligations, to grant to the
Agent the Liens described in the Collateral Documents executed by such Person,
and to perform all of its obligations under the Loan Documents executed by it.
The Loan Documents delivered by the Borrower and by each Subsidiary have been
duly authorized, executed and delivered by such Person and constitute valid and
binding obligations of such Person enforceable in accordance with their terms
except as enforceability may be limited by bankruptcy, insolvency, fraudulent
conveyance or similar laws affecting creditors' rights generally and general
principles of equity (regardless of whether the application of such principles
is considered in a proceeding in equity or at law); and this Agreement and the
other Loan Documents do not, nor does the performance or observance by the
Borrower or any Subsidiary of any of the matters and things herein or therein
provided for, (a) contravene or constitute a default under any provision of law
or any judgment, injunction, order or decree binding upon the Borrower or any
Subsidiary or any provision of the charter, articles of incorporation or
by-laws of the Borrower or any Subsidiary, (b) contravene or constitute a
default under any covenant, indenture or agreement of or affecting the Borrower
or any Subsidiary or any of its Property, in each case where such contravention
or default is reasonably likely to have a Material Adverse Effect, or (c)
result in the creation or imposition of any Lien on any Property of the
Borrower or any Subsidiary other than the Liens granted in favor of the Agent
pursuant to the Collateral Documents.
Section 6.4. Use of Proceeds; Margin Stock. The Borrower shall
use the proceeds of (i) the Term Loans solely for the purposes set forth in
Section 1.3 hereof and (ii) the Revolving Loans and other extensions of credit
made available hereunder for its general working capital purposes and such
other legal and proper purposes as are consistent with all applicable laws.
Neither the Borrower nor any Subsidiary is engaged in the business of extending
credit for the purpose of purchasing or carrying margin stock (within the
meaning of Regulation U of the Board of Governors of the Federal Reserve
System), and no part of the proceeds of any Loan or any other extension of
credit made hereunder will be used to purchase or carry any such margin stock
or to extend credit to others for the purpose of purchasing or
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carrying any such margin stock. Margin stock (as hereinabove defined)
constitutes less than 25% of those assets of the Borrower and its Subsidiaries
which are subject to any limitation on sale, pledge, or other restriction
hereunder.
Section 6.5. Financial Reports. The consolidated balance sheet
of the Borrower and its Subsidiaries as at December 31, 1996, and the related
consolidated statements of income, retained earnings and cash flows of the
Borrower and its Subsidiaries for the fiscal year then ended, and accompanying
notes thereto, which financial statements are accompanied by the audit report
of Ernst & Young, independent public accountants, and the unaudited interim
consolidated balance sheet of the Borrower and its Subsidiaries as at September
30, 1997, and the related consolidated statements of income and retained
earnings of the Borrower and its Subsidiaries for the 9 months then ended,
heretofore furnished to the Banks, fairly present in all material respects the
consolidated financial condition of the Borrower and its Subsidiaries as at
said dates and the consolidated results of their operations and cash flows for
the periods then ended in conformity with GAAP applied on a consistent basis.
Neither the Borrower nor any other Subsidiary has contingent liabilities which
are material to it other than as indicated on such financial statements or
which have been incurred after such date with respect to Acquisitions
consummated prior to the date of this Agreement and either disclosed on
Schedule 6.7 attached hereto or disclosed to the Banks in the written materials
delivered to the Banks pursuant to Section 6.7 hereof or, with respect to
future periods, on the financial statements furnished pursuant to Section 8.5
hereof.
Section 6.6. No Material Adverse Change. Since September 30,
1997, there has been no change in the condition (financial or otherwise) or
business prospects of the Borrower or any Subsidiary, except those occurring in
the ordinary course of business and in connection with the Acquisitions
consummated prior to the date of this Agreement, none of which individually or
in the aggregate have been materially adverse.
Section 6.7. Full Disclosure. The information set forth on
Schedule 6.7 hereof and the statements and information furnished by Borrower to
the Banks in connection with the negotiation of this Agreement and the other
Loan Documents and the commitments by the Banks to provide all or part of the
financing contemplated hereby do not contain any untrue statements of a
material fact or omit a material fact necessary to make the material statements
contained herein or therein, in the light of the circumstances under which they
were made, not misleading, the Banks acknowledging that any projections and
other forward-looking statements regarding future expectations and the beliefs
(the "Statements") furnished by the Borrower to the Banks are subject to risks
and uncertainties which could cause actual results to differ materially from
the Statements made by the Borrower and that the Borrower only represents that
at the time the Statements were made by the Borrower to the Banks, the Borrower
did not know of any material facts that would cause the Statements to be
untrue.
Section 6.8. Trademarks, Franchises, and Licenses. The Borrower
and each of the Subsidiaries own, possess, or have the right to use all
necessary patents, licenses, franchises, trademarks, trade names, trade styles,
copyrights, trade secrets, know how and confidential commercial and proprietary
information to conduct their businesses as now conducted,
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without known conflict with any patent, license, franchise, trademark, trade
name, trade style, copyright or other proprietary right of any other Person.
Section 6.9. Governmental Authority and Licensing. The Borrower
and each of the Subsidiaries have received all licenses, permits, and approvals
of all Federal, state, local, and foreign governmental authorities, if any,
necessary to conduct their business, in each case where the failure to obtain
or maintain the same is reasonably likely to have a Material Adverse Effect.
No investigation or proceeding which, if adversely determined, is reasonably
likely to result in revocation or denial of any material license, permit, or
approval, or of any right to receive reimbursement or payments under Medicare
or other governmental third-party reimbursement or prospective payment program,
is pending or, to the knowledge of the Borrower, threatened.
Section 6.10. Good Title. The Borrower and each of the
Subsidiaries have good and defensible title (or valid leasehold interests) to
their assets as reflected on the most recent consolidated balance sheet of the
Borrower and its Subsidiaries furnished to the Banks (except for sales of
assets in the ordinary course of business), subject to no Liens other than such
thereof as are permitted by Section 8.14 hereof and Liens in favor of
Prudential Securities Credit Corporation and NationsBank, N.A. being released
concurrently with the initial extension of credit hereunder.
Section 6.11. Litigation and Other Controversies. There is no
litigation or governmental proceeding or labor controversy pending, nor to the
knowledge of the Borrower threatened, against the Borrower or any Subsidiary
which if adversely determined is reasonably likely to have a Material Adverse
Effect.
Section 6.12. Taxes. All tax returns required to be filed by the
Borrower or any Subsidiary in any jurisdiction have, in fact, been filed, and
all taxes, assessments, fees and other governmental charges upon the
Borrower or any Subsidiary or upon any of their respective Properties, income
or franchises, which are shown to be due and payable in such returns, have been
paid, except such taxes, assessments, fees and governmental charges, if any, as
are being contested in good faith and by appropriate proceedings which prevent
enforcement of the matter under contest and as to which adequate reserves
established in accordance with GAAP have been provided. Except as disclosed on
Schedule 6.12 hereof, the Borrower does not know of any proposed additional tax
assessment against the Borrower or any Subsidiary for which adequate provisions
in accordance with GAAP have not been made on their accounts. Adequate
provisions in accordance with GAAP for taxes on the books of the Borrower and
each Subsidiary have been made for all open years, and for its current fiscal
period.
Section 6.13. Approvals. No authorization, consent, license, or
exemption from, or filing or registration with, any court or governmental
department, agency or instrumentality, nor any approval or consent of the
stockholders of the Borrower, or any Subsidiary, or any other Person, is or
will be necessary to the valid execution, delivery or performance by the
Borrower or any Subsidiary of this Agreement or any other Loan Document, except
for (i) such approvals which have been obtained prior to the date of this
Agreement and which
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remain in full force and effect or are otherwise subject to the terms of Section
6.9 hereof and (ii) the filing of financing statements with respect to the
Collateral.
Section 6.14. Affiliate Transactions. Neither the Borrower nor
any Subsidiary is a party to any contracts or agreements with any of its
Affiliates on terms and conditions which are less favorable to the Borrower or
such Subsidiary than would be usual and customary in similar contracts or
agreements between Persons not affiliated with each other.
Section 6.15. Investment Company; Public Utility Holding Company.
Neither the Borrower nor any Subsidiary is an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended, or a "public utility holding company" within
the meaning of the Public Utility Holding Company Act of 1935, as amended.
Section 6.16. ERISA. The Borrower and each Subsidiary, and each
member of its Controlled Group, has fulfilled its obligations under the minimum
funding standards of, and is in compliance in all material respects with, ERISA
and the Code to the extent applicable to any Plan maintained by it or for the
benefit of its employees and has not incurred any liability to the PBGC or a
Plan under Title IV of ERISA other than a liability to the PBGC for premiums
under Section 4007 of ERISA. Neither the Borrower nor any Subsidiary has any
material contingent liabilities with respect to any post-retirement benefits
under a Welfare Plan, other than liability for continuation coverage described
in article 6 of Title I of ERISA.
Section 6.17. Compliance with Laws. The Borrower and each
Subsidiary are in compliance with the requirements of all federal, state and
local laws, rules and regulations applicable to or pertaining to their
Properties or business operations (including, without limitation, the
Occupational Safety and Health Act of 1970, the Americans with Disabilities Act
of 1990, laws and regulations relating to the providing of health care services
and products, and laws and regulations establishing quality criteria and
standards for air, water, land and toxic or hazardous wastes and substances),
where any such non-compliance, individually or in the aggregate, is reasonably
likely to have a Material Adverse Effect. Neither the Borrower nor any
Subsidiary has received notice to the effect that its operations are not in
compliance with any of the requirements of applicable federal, state or local
environmental, health and safety statutes and regulations or are the subject of
any governmental investigation evaluating whether any remedial action is needed
to respond to a release of any toxic or hazardous waste or substance into the
environment, where any such non-compliance or remedial action, individually or
in the aggregate, is reasonably likely to have a Material Adverse Effect.
Section 6.18. Other Agreements. Neither the Borrower nor any
Subsidiary is in default under the terms of any covenant, indenture or
agreement of or affecting such Persons or any of their Properties, which
default if uncured is reasonably likely to have a Material Adverse Effect.
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Section 6.19. Solvency. The Borrower and its Subsidiaries, on a
consolidated basis, are solvent, able to pay their debts as they become due,
and have sufficient capital to carry on their business and all businesses in
which they are about to engage.
Section 6.20. Capital Structure. On the date of this Agreement,
the Borrower's capital stock consists of 50,000,000 shares of authorized common
stock, $.001 par value, of which 12,570,972 shares are outstanding, all of
which have been validly issued, are fully paid, and non-assessable; and
10,000,000 shares of authorized preferred stock, of which no shares are
outstanding.
Section 6.21. No Default. No Default or Event of Default has
occurred and is continuing.
SECTION 7. CONDITIONS PRECEDENT.
The obligation of each Bank to advance, continue or convert any Loan
(other than the continuation of, or conversion into, a Base Rate Loan) or of
the Agent to issue, extend the expiration date (including by not giving notice
of non-renewal) of or increase the amount of any Letter of Credit under this
Agreement, shall be subject to the following conditions precedent:
Section 7.1. Initial Credit Event. Before or concurrently with
the initial Credit Event:
(a) the Agent shall have received for each Bank this
Agreement duly executed by the Borrower and the Banks;
(b) the Agent shall have received for each Bank such
Bank's duly executed Notes of the Borrower dated the date hereof and
otherwise in compliance with the provisions of Section 1.11 hereof;
(c) Agent shall have received the Security Agreement and
the Pledge Agreement, duly executed by the Borrower and each Material
Subsidiary, and the Guaranty, duly executed by each Material
Subsidiary, together with (i) original stock certificates or other
similar instruments or securities representing all of the issued and
outstanding shares of capital stock or other equity interest of each
Subsidiary as of the date of this Agreement (other than Block Vision
of Texas, Inc.), (ii) stock powers for the Collateral consisting of
the stock or other equity interest of each Subsidiary (other than
Block Vision of Texas, Inc.), each to be executed in blank and
undated, and (iii) UCC financing statements to be filed against the
Borrower, and each Material Subsidiary, as debtor, in favor of the
Agent, as secured party;
(d) the Agent shall have received evidence of insurance
required to be maintained under the Loan Documents, naming the Agent
as loss payee;
(e) the Agent shall have received for each Bank copies of
the Borrower's and each Material Subsidiary's articles of
incorporation and bylaws (or comparable
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constituent documents) and any amendments thereto, certified in each
instance by its Secretary or Assistant Secretary;
(f) the Agent shall have received for each Bank copies of
resolutions of the Borrower's and of each Material Subsidiary's Board
of Directors authorizing the execution, delivery and performance of
this Agreement and the other Loan Documents to which it is a party and
the consummation of the transactions contemplated hereby and thereby,
together with specimen signatures of the persons authorized to execute
such documents on the Borrower's and such Material Subsidiary's
behalf, all certified in each instance by its Secretary or Assistant
Secretary;
(g) the Agent shall have received for each Bank copies of
the certificates of good standing for the Borrower and for each
Material Subsidiary (dated no earlier than 30 days prior to the date
hereof) from the office of the secretary of the state of its
incorporation and of each state in which it is qualified to do
business as a foreign corporation;
(h) the Agent shall have received for each Bank a list of
the Borrower's Authorized Representatives;
(i) the Agent shall have received for itself and for the
Banks the initial fees called for by Section 2.1 hereof;
(j) each Bank shall have received such evaluations and
certifications as it may reasonably require (including a compliance
certificate in the form attached hereto as Exhibit D containing
compliance calculations of the financial covenants as of December 31,
1997) in order to satisfy itself as to the value of the Collateral,
the financial condition of the Borrower and its Subsidiaries, and the
lack of material contingent liabilities of the Borrower and its
Subsidiaries;
(k) the Agent shall have received a pay-off and lien
release letter from Prudential Securities Credit Corporation and from
NationsBank, N.A. setting forth, among other things, the total amount
of indebtedness owed to it (or outstanding letters of credit issued
for the account of the Borrower or any of its Subsidiaries) and
containing an undertaking to cause to be delivered to the Agent UCC
Termination Statements and any other lien release instrument necessary
to release its Lien on all assets of the Borrower and its
Subsidiaries, which pay-off and lien release letters shall be in form
and substance acceptable to the Agent; and
(l) the Agent shall have received for each Bank the
favorable written opinions of counsel to the Borrower and its
Subsidiaries, in form and substance reasonably satisfactory to the
Agent.
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Section 7.2. All Credit Events. As of the time of each Credit
Event hereunder:
(a) in the case of a Borrowing the Agent shall have
received the notice required by Section 1.6 hereof, in the case of the
issuance of any Letter of Credit the Agent shall have received a duly
completed Application for such Letter of Credit together with any fees
called for by Section 2.1 hereof and, in the case of an extension or
increase in the amount of a Letter of Credit, a written request
therefor in a form acceptable to the Agent together with fees called
for by Section 2.1 hereof;
(b) each of the representations and warranties set forth
in Section 6 hereof shall be and remain true and correct as of such
time, except to the extent that any such representation or warranty
relates solely to an earlier time;
(c) the Borrower shall be in full compliance with all of
the terms and conditions hereof, and no Default or Event of Default
shall have occurred and be continuing hereunder or would occur as a
result of such Credit Event; and
(d) such Credit Event shall not violate any order,
judgment or decree of any court or other authority or any provision of
law or regulation applicable to any Bank (including, without
limitation, Regulation U of the Board of Governors of the Federal
Reserve System).
Each request for a Borrowing hereunder and each request for the
issuance of, increase in the amount of, or extension of the expiration date of,
a Letter of Credit shall be deemed to be a representation and warranty by the
Borrower on the date on such Credit Event as to the facts specified in
subsections (a) through (c), both inclusive, this Section 7.2.
SECTION 8. COVENANTS.
The Borrower agrees that, so long as any Note or any L/C Obligation is
outstanding or any Commitment is available to or in use by the Borrower
hereunder, except to the extent compliance in any case or cases is waived in
writing by the Required Banks:
Section 8.1. Maintenance of Business. The Borrower shall, and
shall cause each Subsidiary to, preserve and maintain its existence, except as
otherwise provided in Section 8.16(c) hereof. The Borrower shall, and shall
cause each Subsidiary to, preserve and keep in force and effect all licenses,
permits, franchises, approvals, patents, trademarks, trade names, trade styles,
copyrights, and other proprietary rights necessary to the proper conduct of its
business where the failure to do so is reasonably likely to have a Material
Adverse Effect.
Section 8.2. Maintenance of Properties. The Borrower shall, and
shall cause each Subsidiary to, maintain, preserve and keep its property, plant
and equipment in good repair, working order and condition (ordinary wear and
tear excepted) and shall from time to time make all needful and proper repairs,
renewals, replacements, additions and betterments thereto so that at all times
the operation thereof shall be fully preserved and maintained, except to the
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extent that, in the reasonable business judgment of such Person, any such
Property is no longer necessary for the proper conduct of the business of such
Person.
Section 8.3. Taxes and Assessments. The Borrower shall duly pay
and discharge, and shall cause each Subsidiary to duly pay and discharge, all
taxes, rates, assessments, fees and governmental charges upon or against it or
its Properties, in each case before the same become delinquent and before
penalties accrue thereon, unless and to the extent that the same are being
contested in good faith and by appropriate proceedings which prevent
enforcement of the matter under contest and adequate reserves are provided
therefor.
Section 8.4. Insurance. The Borrower shall insure and keep
insured, and shall cause each Subsidiary to insure and keep insured, with
insurance companies with a general policyholder service rating of not less than
A as rated in the most current available Best's Insurance Report, all insurable
Property owned by it which is of a character usually insured by Persons
similarly situated and operating like Properties against loss or damage from
such hazards and risks, and in such amounts, as are insured by Persons
similarly situated and operating like Properties; and the Borrower shall
insure, and shall cause each Subsidiary to insure, such other hazards and risks
(including professional liability, employers' and public liability risks) with
insurance companies with a general policyholder service rating of not less than
A as rated in the most current available Best's Insurance Report as and to the
extent usually insured by Persons similarly situated and conducting similar
businesses. The Borrower shall in any event maintain, and cause each
Subsidiary to maintain, insurance on the Collateral to the extent required by
the Collateral Documents. The Borrower shall, upon the request of the Agent,
furnish to the Agent and each Bank a certificate setting forth in summary form
the nature and extent of the insurance maintained pursuant to this Section.
Section 8.5. Financial Reports. The Borrower shall, and shall
cause each Subsidiary to, maintain a standard system of accounting in
accordance with GAAP and shall furnish to the Agent, each Bank and each of
their duly authorized representatives such information respecting the business
and financial condition of the Borrower and each Subsidiary as the Agent or
such Bank may reasonably request; and without any request, shall furnish to the
Agent and the Banks:
(a) as soon as available, and in any event within 30 days
after the last day of each calendar month (except with respect to
January month-end financial statements in each year, in which case the
financial statements required below shall be delivered within 45 days
after the last day of each January), a copy of the consolidated
balance sheet of Borrower and its Subsidiaries as of the last day of
such month and the consolidated statements of income, retained
earnings and cash flows of the Borrower and its Subsidiaries for the
month and for the fiscal year-to-date period then ended, each in
reasonable detail shown in comparative form against the Borrower's
business plan for such year, prepared by the Borrower and certified to
by the Borrower's chief financial office, or another officer of the
Borrower reasonably acceptable to the Agent;
(b) as soon as available, and in any event within 45 days
after the close of each fiscal quarter of each fiscal year of the
Borrower, a copy of the consolidated and
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consolidating balance sheet of the Borrower and its Subsidiaries as of
the last day of such period and the consolidated and consolidating
statements of income, retained earnings and cash flows of the Borrower
and its Subsidiaries for the fiscal quarter and for the fiscal
year-to-date period then ended, each in reasonable detail showing in
comparative form the figures for the corresponding date and period in
the previous fiscal year, prepared by the Borrower in accordance with
GAAP and certified to by the Borrower's chief financial officer, or
another officer of the Borrower reasonably acceptable to the Agent;
(c) as soon as available, and in any event within 90 days
after the close of each fiscal year of the Borrower (commencing with
the fiscal year ended December 31, 1997), a copy of the consolidated
and consolidating balance sheet of the Borrower and its Subsidiaries
as of the last day of the period then ended and the consolidated and
consolidating statements of income, retained earnings and cash flows
of the Borrower and its Subsidiaries for the period then ended, and
accompanying notes thereto, each in reasonable detail showing in
comparative form the figures for the previous fiscal year, accompanied
by an unqualified opinion on the consolidated financial statements of
Ernst & Young (or its successors) or another firm of independent
public accountants of recognized national standing, selected by the
Borrower and reasonably satisfactory to the Required Banks, to the
effect that the consolidated financial statements have been prepared
in accordance with GAAP and present fairly, in all material respects,
in accordance with GAAP the consolidated financial condition of the
Borrower and its Subsidiaries as of the close of such fiscal year and
the results of their operations and cash flows for the fiscal year
then ended and that an examination of such accounts in connection with
such financial statements has been made in accordance with generally
accepted auditing standards and, accordingly, such examination
included such tests of the accounting records and such other auditing
procedures as were considered necessary in the circumstances;
(d) promptly after the sending or filing thereof, copies
of each financial statement, report, notice or proxy statement sent by
the Borrower or any Subsidiary to its stockholders, and copies of each
regular, periodic or special report, registration statement or
prospectus (including all Form 10-K, Form 10-Q, and Form 8-K reports
and proxy statements) filed by the Borrower or any Subsidiary with any
securities exchange or the Securities and Exchange Commission or any
successor agency;
(e) promptly after receipt thereof, a copy of each audit
made by any regulatory agency of the books and records of the Borrower
or any Subsidiary or of any notice of material noncompliance with any
applicable law, regulation, or guideline relating to the Borrower or
any Subsidiary or any of their respective businesses;
(f) as soon as available, and in any event within 75 days
after the end of each fiscal year of the Borrower (commencing with the
fiscal year ended December 31, 1997), a copy of the Borrower's
consolidated and consolidating business plan for the following fiscal
year, such business plan to show the Borrower's projected consolidated
and consolidating revenues, expenses, and balance sheet on
month-by-month basis, such
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business plan to be in reasonable detail prepared by the Borrower and
in form reasonably satisfactory to the Agent which shall include a
summary of all assumptions made in preparing such business plan;
(g) notice of any Change of Control; and
(h) promptly after knowledge thereof shall have come to
the attention of any responsible officer of the Borrower, written
notice of any threatened or pending litigation or governmental
proceeding or labor controversy against the Borrower or any other
Subsidiary which, if adversely determined, is reasonably likely to
have a Material Adverse Effect or of the occurrence of any Default or
Event of Default hereunder.
Each of the financial statements furnished to the Banks pursuant to subsections
(b) and (c) of this Section 8.5 shall be accompanied by a written certificate
in the form attached hereto as Exhibit D signed by the chief financial officer
of the Borrower, or another officer of the Borrower reasonably acceptable to
the Agent, to the effect that to the best of such officer's knowledge and
belief no Default or Event of Default has occurred during the period covered by
such statements or, if any such Default or Event of Default has occurred during
such period, setting forth a description of such Default or Event of Default
and specifying the action, if any, taken by the Borrower or any Subsidiary to
remedy the same. Such certificate shall also set forth the calculations
supporting such statements in respect of Sections 8.7, 8.8, 8.9, 8.10, 8.11 and
8.12 of this Agreement.
Section 8.6. Inspection. The Borrower shall, and shall cause
each Subsidiary to, permit the Agent, each Bank and each of their duly
authorized representatives and agents to visit and inspect any of its
Properties, corporate books and financial records, to examine and make copies
of its books of accounts and other financial records, and to discuss its
affairs, finances and accounts with, and to be advised as to the same by, its
executive officers, employees and independent public accountants (and by this
provision the Borrower hereby authorizes such accountants to discuss with the
Agent and such Banks the finances and affairs of the Borrower and each other
Subsidiary) at such reasonable times and intervals as the Agent or any such
Bank may designate with prior notice to the Borrower.
Section 8.7. Current Ratio. The Borrower shall, at all times
(commencing March 31, 1998), maintain a Current Ratio of not less than 1.0 to
1.0.
Section 8.8. Total Funded Debt/Adjusted EBITDA Ratio. As of the
last day of each fiscal quarter of the Borrower ending during the periods
specified below, the Borrower shall not permit the Total Funded Debt/Adjusted
EBITDA Ratio as of the last day of such fiscal quarter to be greater than or
equal to:
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RATIO SHALL NOT BE
FROM AND INCLUDING TO AND INCLUDING GREATER THAN OR EQUAL TO
the date hereof 09/30/98 3.5 to 1.0
10/01/98 03/31/99 3.25 to 1.0
04/31/99 at all times thereafter 3.0 to 1.0
Section 8.9. Net Worth. The Borrower shall, at all times,
maintain Net Worth of not less than the sum of (a) $48,823,000, plus (b) 75% of
Net Income for each fiscal quarter of the Borrower ending after the date of
this Agreement for which such Net Income is a positive amount (i.e., there
shall be no reduction to the amount of Net Worth required to be maintained
hereunder for any such period in which Net Income is less than zero), plus (c)
100% of the net proceeds received by the Borrower from any offering of equity
securities of the Borrower received at any time after the date of this
Agreement.
Section 8.10. Interest Coverage Ratio. As of the last day of
each fiscal quarter of the Borrower ending during the periods specified below,
the Borrower shall maintain a ratio of EBITDA for the four fiscal quarters of
the Borrower then ended to Interest Expense for the same four fiscal quarters
then ended of not less than:
RATIO SHALL NOT BE LESS
FROM AND INCLUDING TO AND INCLUDING THAN
the date hereof 12/31/98 3.0 to 1.0
01/01/99 12/31/99 3.25 to 1.0
01/01/2000 and at all times thereafter 3.5 to 1.0
; provided that such ratio shall be computed on March 31, 1998, for the
fiscal quarter then ended, on June 30, 1998, for the period of two fiscal
quarters then ended, and on September 30, 1998, for the period of three fiscal
quarters then ended.
Section 8.11. Debt Service Coverage Ratio. As of the last day of
each fiscal quarter of the Borrower ending during the periods specified below,
the Borrower shall maintain a ratio of (a) EBITDA for the four fiscal quarters
of the Borrower then ended less the sum of (i) Capital Expenditures incurred
during such period and (ii) cash payments made during such period with respect
to federal, state, and local income taxes to (b) the aggregate amount of
payments required to be made by the Borrower and its Subsidiaries during the
four fiscal quarters of the Borrower then ended in respect of all principal on
all Indebtedness for Borrowed Money (whether at maturity, as a result of
mandatory sinking fund redemption, mandatory prepayment, acceleration or
otherwise) plus Interest Expense for the same four fiscal quarter period then
ended, of not less than:
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RATIO SHALL NOT BE LESS
FROM AND INCLUDING TO AND INCLUDING THAN
the date hereof 12/31/98 1.75 to 1.0
01/01/99 at all times thereafter 2.0 to 1.0
; provided that such ratio shall be computed on March 31, 1998, for the fiscal
quarter then ended, on June 30, 1998, for the period of two fiscal quarters
then ended, and on September 30, 1998, for the period of three fiscal quarters
then ended.
Section 8.12. Capital Expenditures. The Borrower shall not, nor
shall it permit any other Subsidiary to, incur Capital Expenditures in an
aggregate amount in excess of $6,000,000 during any fiscal year.
Section 8.13. Indebtedness for Borrowed Money. The Borrower
shall not, nor shall it permit any Subsidiary to, issue, incur, assume, create
or have outstanding any Indebtedness for Borrowed Money; provided, however,
that the foregoing shall not restrict nor operate to prevent:
(a) the Obligations of the Borrower and each Subsidiary
owing to the Agent and the Banks hereunder;
(b) purchase money indebtedness and Capitalized Lease
Obligations of the Borrower and of its Subsidiaries in an aggregate
amount not to exceed $1,000,000 at any one time outstanding;
(c) obligations of the Borrower arising out of interest
rate hedging agreements entered into with financial institutions in
the ordinary course of business;
(d) guaranties expressly permitted by Section 8.15 hereof;
(e) indebtedness assumed in any one or more acquisitions
permitted by Section 8.15(k) hereof, but not incurred in contemplation
of such acquisition, in an aggregate amount not to exceed $1,000,000
at any one time outstanding;
(f) other indebtedness existing on the date of this
Agreement and described on Schedule 8.13 attached hereto and made a
part hereof, as reduced from time to time by repayments thereof;
(g) indebtedness from time to time owing by the Borrower
to any Subsidiary or by any Subsidiary to the Borrower or any other
Subsidiary; and
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(h) other indebtedness of the Borrower and its
Subsidiaries not otherwise permitted by this Section in an aggregate
amount not to exceed $5,000,000 at any one time outstanding.
Section 8.14. Liens. The Borrower shall not, nor shall it permit
any other Subsidiary to, create, incur or permit to exist any Lien of any kind
on any Property owned by any such Person; provided, however, that the foregoing
shall not apply to nor operate to prevent:
(a) Liens arising by statute in connection with worker's
compensation, unemployment insurance, old age benefits, social
security obligations, taxes, assessments, statutory obligations or
other similar charges, good faith cash deposits in connection with
tenders, contracts or leases to which the Borrower or any Subsidiary
is a party or other cash deposits required to be made in the ordinary
course of business, provided in each case that the obligation is not
for borrowed money and that the obligation secured is not overdue or,
if overdue, is being contested in good faith by appropriate
proceedings which prevent enforcement of the matter under contest and
adequate reserves have been established therefor;
(b) mechanics', workmen's, materialmen's, landlords',
carriers', or other similar Liens arising in the ordinary course of
business with respect to obligations which are not due or which are
being contested in good faith by appropriate proceedings which prevent
enforcement of the matter under contest;
(c) the pledge of assets for the purpose of securing an
appeal, stay or discharge in the course of any legal proceeding,
provided that the aggregate amount of liabilities of the Borrower and
its Subsidiaries secured by a pledge of assets permitted under this
subsection, including interest and penalties thereon, if any, shall
not be in excess of $500,000 at any one time outstanding;
(d) the Liens granted in favor of the Agent for the
benefit of the Agent and the Banks pursuant to the Collateral
Documents;
(e) Liens on property of the Borrower, or any Subsidiary
created solely for the purpose of securing indebtedness permitted by
Section 8.13(b) hereof, representing or incurred to finance, refinance
or refund the purchase price of Property, provided that no such Lien
shall extend to or cover other Property of the Borrower or such
Subsidiary other than the respective Property so acquired, and the
principal amount of indebtedness secured by any such Lien shall at no
time exceed the original purchase price of such Property;
(f) easements, rights-of-way, restrictions and other
similar encumbrances incurred in the ordinary course of business
which, in the aggregate, are not substantial in amount and which do
not materially detract from the value of the Property subject thereto
or materially interfere with the ordinary conduct of the business of
the Borrower or any Subsidiary;
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(g) Liens on Property acquired by the Borrower or any
Subsidiary, or owned by any newly acquired Subsidiary existing at the
time of acquisition, securing indebtedness permitted by Section
8.13(e) hereof and not incurred in contemplation of such acquisition;
and
(h) any interest or title of a lessor under any operating
lease.
Section 8.15. Investments, Acquisitions, Loans, Advances and
Guaranties. The Borrower shall not, nor shall it permit any Subsidiary to,
directly or indirectly, make, retain or have outstanding any investments
(whether through purchase of stock or obligations or otherwise) in, or loans or
advances (other than for travel advances and other similar cash advances made
to employees in the ordinary course of business) to, any other Person, or
acquire all or any substantial part of the assets or business of any other
Person or division thereof, or be or become liable as endorser, guarantor,
surety or otherwise for any debt, obligation or undertaking of any other
Person, or otherwise agree to provide funds for payment of the obligations of
another, or supply funds thereto or invest therein or otherwise assure a
creditor of another against loss, or apply for or become liable to the issuer
of a letter of credit which supports an obligation of another, or subordinate
any claim or demand it may have to the claim or demand of any other Person;
provided, however, that the foregoing shall not apply to nor operate to
prevent:
(a) investments in direct obligations of the United
States of America or of any agency or instrumentality thereof whose
obligations constitute full faith and credit obligations of the United
States of America, provided that any such obligations shall mature
within one year of the date of issuance thereof;
(b) investments in commercial paper rated at least P-1 by
▇▇▇▇▇'▇ and at least A-1 by S&P maturing within one year of the date
of issuance thereof;
(c) investments in certificates of deposit issued by any
Bank or by any United States commercial bank having capital and
surplus of not less than $100,000,000 which have a maturity of one
year or less;
(d) endorsement of items for deposit or collection of
commercial paper received in the ordinary course of business;
(e) the Borrower's investments from time to time in its
Subsidiaries, and investments made from time to time by a Subsidiary
in one or more of its Subsidiaries;
(f) the guarantee of the Obligations by the Subsidiaries
pursuant to the Guaranties;
(g) guaranties issued by the Borrower or any Subsidiary
guaranteeing or otherwise supporting the repayment of indebtedness of
the Borrower or another Subsidiary otherwise permitted by
Section 8.13 hereof;
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(h) trade receivables from time to time owing to the
Borrower or any Subsidiary created or acquired in the ordinary course
of its business;
(i) guaranties by the Borrower or any Subsidiary of the
obligations of any other Subsidiary, as lessee, under any real estate
leases entered into in the ordinary course of its business;
(j) ordinary course of business investments in, directly
or indirectly, joint ventures with other Persons formed to provide
products or services in an Eligible Line of Business in an aggregate
amount not to exceed $1,000,000 during any fiscal year of the
Borrower;
(k) Permitted Acquisitions and other acquisitions by the
Borrower or any Subsidiary of the stock or assets of Persons primarily
engaged in any Eligible Line of Business if and only so long as (i)
prior to consummation of any such transaction the Borrower shall have
notified the Banks of the proposed transaction in reasonable detail as
to the terms thereof (including sources and uses of funds therefor)
and the Borrower shall have furnished the Banks historic and pro forma
financial information and compliance calculations reasonably
satisfactory to the Agent demonstrating no Default or Event of Default
exists or, on a pro forma basis, would occur after giving effect to
such transaction, (ii) the acquisition is not a Hostile Acquisition,
(iii) in the case of any acquisition other than a Permitted
Acquisition, the Required Banks have consented thereto in writing
prior to the Borrower or any Subsidiary entering into such transaction
or a binding commitment to consummate any such transaction, whichever
is earlier (no such consent being required for a Permitted
Acquisition), which consent shall not be unreasonably withheld, and
(iv) no Default or Event of Default exists or would arise immediately
after giving effect to any such transaction;
(l) investments held by any Subsidiary acquired after the
date of this Agreement existing at the time of its acquisition by the
Borrower or other existing Subsidiary and not acquired by such
Subsidiary in contemplation of such acquisition;
(m) intercompany advances made from time to time between
the Borrower and one or more Subsidiaries or between Subsidiaries; and
(n) other investments, loans, and advances in addition to
those otherwise permitted by this Section in an aggregate amount not
to exceed $500,000 at any one time outstanding.
In determining the amount of investments, acquisitions, loans, advances and
guaranties permitted under this Section, investments and acquisitions shall
always be taken at the original cost thereof (regardless of any subsequent
appreciation or depreciation therein), loans and advances shall be taken at the
principal amount thereof then remaining unpaid, and guaranties shall be taken
at the amount of the obligations guaranteed thereby.
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Section 8.16. Mergers, Consolidations and Sales. The Borrower
shall not, nor shall it permit any Subsidiary to, be a party to any merger or
consolidation, or sell, transfer, lease or otherwise dispose of its Property,
including any disposition of Property as part of a sale and leaseback
transaction, or in any event sell or discount (with or without recourse) any of
its notes or accounts receivable; provided, however, that this Section shall
not apply to nor operate to prevent:
(a) the sale or lease of inventory in the ordinary course
of business, or the lease of equipment or real property in the
ordinary course of business to a provider, or professional association
of providers, of medical services in the ordinary course of business
(provided any such lease shall be junior and subordinate to the rights
of the Agent in any such asset);
(b) the sale, transfer, lease, or other disposition of
Property of the Borrower or any Subsidiary to one another in the
ordinary course of its business;
(c) a merger of any Subsidiary with and into the Borrower
or any other Subsidiary; provided that, in the case of any merger
involving the Borrower, the Borrower is the corporation surviving the
merger;
(d) the sale of delinquent notes or accounts receivable
in the ordinary course of business for purposes of collection only
(and not for the purpose of any bulk sale or securitization
transaction);
(e) the sale, transfer, or other disposition of any
tangible personal property that, in the reasonable business judgment
of the Borrower or its Subsidiary, has become uneconomical, obsolete,
or worn out, and which is disposed of in the ordinary course of
business; and
(f) the sale, transfer, lease, or other disposition of
Property of the Borrower or any Subsidiary aggregating for the
Borrower and its Subsidiaries not more than $500,000 during any
12-month period;
provided, however, that during the existence of any Default or Event of
Default, any sale, transfer, lease, or other disposition of any such Property
will be subject to the terms of the relevant Collateral Documents relating to
the permitted disposition thereof. In the event of any merger permitted by
Section 8.16(c) above, the Borrower shall give the Agent and the Bank's prior
written notice of any such event and, immediately after giving effect to any
such merger, Schedule 6.2 of this Agreement shall be deemed amended excluding
reference to any such Subsidiary merged out of existence. So long as no
Default or Event of Default has occurred and is continuing or would arise as a
result thereof, upon the written request of the Borrower, the Agent shall
release its Lien on any Property sold pursuant to the foregoing provisions.
Section 8.17. Maintenance of Subsidiaries. The Borrower shall
not assign, sell or transfer, nor shall it permit any Subsidiary to issue,
assign, sell or transfer, any shares of
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capital stock of a Subsidiary; provided, however, that the foregoing shall not
operate to prevent (i) the Lien on the capital stock of each Subsidiary granted
to the Agent pursuant to the Collateral Documents, (ii) the issuance, sale and
transfer to any person of any shares of capital stock of a Subsidiary solely
for the purpose of qualifying, and to the extent legally necessary to qualify,
such person as a director of such Subsidiary, and (iii) any transaction
permitted by Section 8.16(c) above.
Section 8.18. Dividends and Certain Other Restricted Payments.
The Borrower shall not, nor shall it permit any Subsidiary to, during any
fiscal year (i) declare or pay any dividends on or make any other distributions
in respect of any class or series of its capital stock (other than dividends
payable solely in its capital stock) or (ii) directly or indirectly purchase,
redeem or otherwise acquire or retire any of its capital stock; provided,
however, that the foregoing shall not operate to prevent (a) the making of
dividends or distributions by any Wholly-Owned Subsidiary to its parent
corporation or (b) the redemption by the Borrower of its capital stock from
LaserSight Incorporated pursuant to the terms of the Stock Distribution
Agreement dated December 30, 1997, between Laser Sight Incorporated and the
Borrower for an aggregate purchase price of not more than $7,475,000 so long as
at the time of such redemption, and after giving effect thereto, no Default or
Event of Default exists.
Section 8.19. ERISA. The Borrower shall, and shall cause each
Subsidiary to, promptly pay and discharge all obligations and liabilities
arising under ERISA pertaining to a Plan of a character which if unpaid or
unperformed is reasonably likely to result in the imposition of a Lien against
any of its Properties. The Borrower shall, and shall cause each Subsidiary to,
promptly notify the Agent of (i) the occurrence of any reportable event (as
defined in ERISA) with respect to a Plan, (ii) receipt of any notice from the
PBGC of its intention to seek termination of any Plan or appointment of a
trustee therefor, (iii) its intention to terminate or withdraw from any Plan,
and (iv) the occurrence of any event with respect to any Plan which would
result in the incurrence by the Borrower or any Subsidiary of any material
liability, fine or penalty, or any material increase in the contingent
liability of the Borrower or any Subsidiary with respect to any post-retirement
Welfare Plan benefit.
Section 8.20. Compliance with Laws. The Borrower shall, and
shall cause each Subsidiary to, comply in all respects with the requirements of
all federal, state and local laws, rules, regulations, ordinances and orders
applicable to or pertaining to its Properties or business operations, where any
such non-compliance, individually or in the aggregate, is reasonably likely to
have a Material Adverse Effect or is reasonably likely to result in a Lien upon
any of their Property.
Section 8.21. Burdensome Contracts With Affiliates. The Borrower
shall not, nor shall it permit any Subsidiary to, enter into any contract,
agreement or business arrangement with any of its Affiliates on terms and
conditions which are less favorable to the Borrower or such Subsidiary than
would be usual and customary in similar contracts, agreements or business
arrangements between Persons not affiliated with each other.
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Section 8.22. No Changes in Fiscal Year. The Borrower shall not,
nor shall it permit any Subsidiary to, change its fiscal year from its present
basis without the prior written consent of the Required Banks.
Section 8.23. Formation of Subsidiaries. Promptly upon the
formation or acquisition of any Subsidiary, the Borrower shall provide the
Agent and the Banks written notice thereof and shall do such acts and things as
are required of it to comply with Section 4 hereof, and then and thereafter
Schedule 6.2 of this Agreement shall be deemed amended from and after such date
to include reference to any such Subsidiary.
Section 8.24. Change in the Nature of Business. The Borrower
shall not, nor shall it permit any Subsidiary to, engage in any business or
activity if as a result the general nature of the business of the Borrower or
any Subsidiary would be changed in any material respect from the general nature
of the business engaged in by it as of the date of this Agreement or as of the
date such Person becomes a Subsidiary hereunder.
Section 8.25. Change in Capital Structure. Except for the
authorization and/or issuance of additional common stock, the Borrower shall
not change its capital structure or authorize or issue any other equity
securities (other than warrants and/or options to acquire the Borrower's common
stock) without the prior written consent of the Required Banks.
Section 8.26. Use of Loan Proceeds. The Borrower shall use the
credit extended under this Agreement solely for the purposes set forth in, or
otherwise permitted by, Section 6.4 hereof.
Section 8.27. No Restrictions on Subsidiary Distributions.
Except as provided herein, the Borrower shall not, nor shall it permit any
Subsidiary to, directly or indirectly create or otherwise cause or suffer to
exist or become effective any consensual encumbrance or restriction of any kind
on the ability of the Borrower or any Subsidiary to: (a) guarantee the
Obligations and grant Liens on its assets to the Agent for the benefit of the
Banks as required by Section 4 hereof; (b) in the case of any Subsidiary, pay
dividends or make any other distribution on any of such Subsidiary's capital
stock or other equity interests owned by the Borrower or any Subsidiary; (c)
pay any indebtedness owed to the Borrower or any Subsidiary; (d) make loans or
advances to the Borrower or any Subsidiary; or (e) transfer any of its property
or assets to the Borrower or any Subsidiary.
Section 8.28. Block Vision of Texas. So long as Block Vision of
Texas, Inc. ("BVT") is a Subsidiary, directly or indirectly, of the Borrower,
the Borrower shall not permit the total tangible assets of BVT to have a book
value in excess of 2.5% of the Borrower's consolidated total tangible assets or
the gross revenues of BVT to be in excess of 2.5% of the Borrowers consolidated
total revenues.
SECTION 9. EVENTS OF DEFAULT AND REMEDIES.
Section 9.1. Events of Default. Any one or more of the
following shall constitute an "Event of Default" hereunder:
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(a) default in the payment when due of all or any part of
the principal of any Note (whether at the stated maturity thereof or
at any other time provided for in this Agreement), or default for a
period of 3 Business Days in the payment when due of any interest on
any Note or of any Reimbursement Obligation or of any fee or other
Obligation payable hereunder or under any other Loan Document;
(b) default in the observance or performance of any
covenant set forth in Section 8.5, 8.7, 8.8, 8.9, 8.10, 8.11, 8.12,
8.13, 8.15, 8.16, 8.17, 8.18, 8.24, 8.25, 8.26, or 8.27 hereof or of
any provision in any Loan Document dealing with the use, disposition
or remittance of the proceeds of Collateral or requiring the
maintenance of insurance thereon;
(c) default in the observance or performance of any other
provision hereof or of any other Loan Document which is not remedied
within 30 days after the earlier of (i) the date on which such failure
shall first become known to any executive officer of the Borrower or
(ii) written notice thereof is given to the Borrower by the Agent;
(d) any representation or warranty made herein or in any
other Loan Document or in any certificate furnished to the Agent or
the Banks pursuant hereto or thereto or in connection with any
transaction contemplated hereby or thereby proves untrue in any
material respect as of the date of the issuance or making or deemed
making thereof;
(e) any event occurs or condition exists (other than
those described in subsections (a) through (d) above) which is
specified as an event of default under any of the other Loan
Documents, or any of the Loan Documents, or any material provisions
thereof, shall for any reason not be or shall cease to be in full
force and effect or is declared to be null and void, or any of the
Collateral Documents shall for any reason fail to create a valid and
perfected first priority Lien in favor of the Agent in any Collateral
purported to be covered thereby except as expressly permitted by the
terms thereof, or the Borrower or any Subsidiary takes any action for
the purpose of terminating, repudiating or rescinding any Loan
Document executed by it or any of its obligations thereunder;
(f) default shall occur under any Indebtedness for
Borrowed Money aggregating in excess of $500,000 issued, assumed or
guaranteed by the Borrower or any Subsidiary, or under any indenture,
agreement or other instrument under which the same may be issued, and
such default shall continue for a period of time sufficient to permit
the acceleration of the maturity of any such Indebtedness for Borrowed
Money (whether or not such maturity is in fact accelerated), or any
such Indebtedness for Borrowed Money shall not be paid when due
(whether by demand, lapse of time, acceleration or otherwise);
(g) any judgment or judgments, writ or writs or warrant
or warrants of attachment, or any similar process or processes in an
aggregate amount in excess of $500,000 in excess of any applicable
insurance coverage shall be entered or filed
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against any of the Borrower or any Subsidiary, or against any of its
Property, and which remains undischarged, unvacated, unbonded or
unstayed for a period of 30 days;
(h) the Borrower or any Subsidiary, or any member of its
Controlled Group, shall fail to pay when due an amount or amounts
aggregating in excess $500,000 which it shall have become liable to
pay to the PBGC or to a Plan under Title IV of ERISA; or notice of
intent to terminate a Plan or Plans having aggregate Unfunded Vested
Liabilities in excess of $500,000 (collectively, a "Material Plan")
shall be filed under Title IV of ERISA by the Borrower or any
Subsidiary, or any other member of its Controlled Group, any plan
administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate or to cause
a trustee to be appointed to administer any Material Plan or a
proceeding shall be instituted by a fiduciary of any Material Plan
against the Borrower or any Subsidiary, or any member of its
Controlled Group, to enforce Section 515 or 4219(c)(5) of ERISA and
such proceeding shall not have been dismissed within 30 days
thereafter; or a condition shall exist by reason of which the PBGC
would be entitled to obtain a decree adjudicating that any Material
Plan must be terminated;
(i) the Borrower or any Subsidiary shall (i) have entered
involuntarily against it an order for relief under the United States
Bankruptcy Code, as amended, (ii) not pay, or admit in writing its
inability to pay, its debts generally as they become due, (iii) make
an assignment for the benefit of creditors, (iv) apply for, seek,
consent to, or acquiesce in, the appointment of a receiver, custodian,
trustee, examiner, liquidator or similar official for it or any
substantial part of its Property, (v) institute any proceeding seeking
to have entered against it an order for relief under the United States
Bankruptcy Code, as amended, to adjudicate it insolvent, or seeking
dissolution, winding up, liquidation, reorganization, arrangement,
adjustment or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors or fail
to file an answer or other pleading denying the material allegations
of any such proceeding filed against it, (vi) take any corporate
action in furtherance of any matter described in parts (i) through (v)
above, or (vii) fail to contest in good faith any appointment or
proceeding described in Section 9.1(j) hereof;
(j) a custodian, receiver, trustee, examiner, liquidator
or similar official shall be appointed for the Borrower or any
Subsidiary or any substantial part of any of its Property, or a
proceeding described in Section 9.1(i)(v) shall be instituted against
the Borrower or any Subsidiary, and such appointment continues
undischarged or such proceeding continues undismissed or unstayed for
a period of 30 days; or
(k) one or more long-term management agreements pursuant
to which the Borrower or any Subsidiary provides management and/or
administrative services is terminated or cancelled prior to its
scheduled termination date (whether as a result of a breach by the
Borrower or such Subsidiary thereunder or otherwise) or any advisory
agreement pursuant to which one or more Persons provide advisory
services to the Borrower or any Subsidiary in connection with
identifying potential Acquisitions is terminated or cancelled prior to
its scheduled termination date (whether as a result of a
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breach by the Borrower or such Subsidiary thereunder or otherwise)
and, in the reasonable judgment of the Required Banks, any such
termination or cancellation is reasonably likely to have a Material
Adverse Effect.
Section 9.2. Non-Bankruptcy Defaults. When any Event of Default
other than those described in subsection (i) or (j) of Section 9.1 hereof has
occurred and is continuing, the Agent shall, by written notice to the Borrower:
(a) if so directed by the Required Banks, terminate the remaining Commitments
and all other obligations of the Banks hereunder on the date stated in such
notice (which may be the date thereof); (b) if so directed by the Required
Banks, declare the principal of and the accrued interest on all outstanding
Notes to be forthwith due and payable and thereupon all outstanding Notes,
including both principal and interest thereon, shall be and become immediately
due and payable together with all other amounts payable under the Loan
Documents without further demand, presentment, protest or notice of any kind;
and (c) if so directed by the Required Banks, demand that the Borrower
immediately pay to the Agent the full amount then available for drawing under
each or any Letter of Credit, and the Borrower agrees to immediately make such
payment and acknowledges and agrees that the Banks would not have an adequate
remedy at law for failure by the Borrower to honor any such demand and that the
Agent, for the benefit of the Banks, shall have the right to require the
Borrower to specifically perform such undertaking whether or not any drawings
or other demands for payment have been made under any Letter of Credit. The
Agent, after giving notice to the Borrower pursuant to Section 9.1(c) or this
Section 9.2, shall also promptly send a copy of such notice to the other Banks,
but the failure to do so shall not impair or annul the effect of such notice.
Section 9.3. Bankruptcy Defaults. When any Event of Default
described in subsections (i) or (j) of Section 9.1 hereof has occurred and is
continuing, then all outstanding Notes shall immediately become due and payable
together with all other amounts payable under the Loan Documents without
presentment, demand, protest or notice of any kind, the obligation of the Banks
to extend further credit pursuant to any of the terms hereof shall immediately
terminate and the Borrower shall immediately pay to the Agent the full amount
then available for drawing under all outstanding Letters of Credit, the
Borrower acknowledging and agreeing that the Banks would not have an adequate
remedy at law for failure by the Borrower to honor any such demand and that the
Banks, and the Agent on their behalf, shall have the right to require the
Borrower to specifically perform such undertaking whether or not any draws or
other demands for payment have been made under any of the Letters of Credit.
Section 9.4. Collateral for Undrawn Letters of Credit. (a) If
the prepayment of the amount available for drawing under any or all outstanding
Letters of Credit is required under Section 1.9(b) or under Section 9.2 or 9.3
above, the Borrower shall forthwith pay the amount required to be so prepaid,
to be held by the Agent as provided in subsection (b) below.
(b) All amounts prepaid pursuant to subsection (a) above shall be
held by the Agent in a separate collateral account (such account, and the
credit balances, properties and any investments from time to time held therein,
and any substitutions for such account, any certificate of deposit or other
instrument evidencing any of the foregoing and all proceeds of
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and earnings on any of the foregoing being collectively called the "Account")
as security for, and for application by the Agent (to the extent available) to,
the reimbursement of any payment under any Letter of Credit then or thereafter
made by the Agent, and to the payment of the unpaid balance of any Loans and
all other Obligations. The Account shall be held in the name of and subject to
the exclusive dominion and control of the Agent for the benefit of the Agent
and the Banks. If and when requested by the Borrower, the Agent shall invest
funds held in the Account from time to time in direct obligations of, or
obligations the principal of and interest on which are unconditionally
guaranteed by, the United States of America with a remaining maturity of one
year or less, provided that the Agent is irrevocably authorized to sell
investments held in the Account when and as required to make payments out of
the Account for application to amounts due and owing from the Borrower to the
Agent or Banks; provided, however, that if (i) the Borrower shall have made
payment of all such obligations referred to in subsection (a) above, (ii) all
relevant preference or other disgorgement periods relating to the receipt of
such payments have passed, and (iii) no Letters of Credit, Commitments, Loans
or other Obligations remain outstanding hereunder, then the Agent shall release
to the Borrower any remaining amounts held in the Account.
Section 9.5. Notice of Default. The Agent shall give notice to
the Borrower under Section 9.1(c) hereof promptly upon being requested to do so
by any Bank and shall thereupon notify all the Banks thereof.
Section 9.6. Expenses. The Borrower agrees to pay to the Agent
and each Bank, and any other holder of any Note outstanding hereunder, all
expenses reasonably incurred or paid by the Agent and such Bank or any such
holder, including reasonable attorneys' fees and court costs, in connection
with any Default or Event of Default by the Borrower hereunder or in connection
with the enforcement of any of the Loan Documents.
SECTION 10. CHANGE IN CIRCUMSTANCES.
Section 10.1. Change of Law. Notwithstanding any other
provisions of this Agreement or any Note, if at any time any change in
applicable law or regulation or in the interpretation thereof makes it unlawful
for any Bank to make or continue to maintain any Eurodollar Loans or to perform
its obligations as contemplated hereby, such Bank shall promptly give notice
thereof to the Borrower and such Bank's obligations to make or maintain
Eurodollar Loans under this Agreement shall terminate until it is no longer
unlawful for such Bank to make or maintain Eurodollar Loans. The Borrower
shall prepay on demand the outstanding principal amount of any such affected
Eurodollar Loans, together with all interest accrued thereon and all other
amounts then due and payable to such Bank under this Agreement; provided,
however, subject to all of the terms and conditions of this Agreement, the
Borrower may then elect to borrow the principal amount of the affected
Eurodollar Loans from such Bank by means of Base Rate Loans from such Bank,
which Base Rate Loans shall not be made ratably by the Banks but only from such
affected Bank.
Section 10.2. Unavailability of Deposits or Inability to
Ascertain, or Inadequacy of, LIBOR. If on or prior to the first day of any
Interest Period for any Borrowing of Eurodollar Loans:
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(a) the Agent determines that deposits in U.S. Dollars
(in the applicable amounts) are not being offered to it in the
interbank eurodollar market for such Interest Period, or that by
reason of circumstances affecting the interbank eurodollar market
adequate and reasonable means do not exist for ascertaining the
applicable LIBOR, or
(b) the Required Banks advise the Agent that (i) LIBOR as
determined by the Agent will not adequately and fairly reflect the
cost to such Banks of funding their Eurodollar Loans for such Interest
Period or (ii) that the making or funding of Eurodollar Loans become
impracticable,
then the Agent shall forthwith give notice thereof to the Borrower and the
Banks, whereupon until the Agent notifies the Borrower that the circumstances
giving rise to such suspension no longer exist, the obligations of the Banks to
make Eurodollar Loans shall be suspended.
Section 10.3. Increased Cost and Reduced Return. (a) If, on or
after the date hereof, the adoption of any applicable law, rule or regulation,
or any change therein, or any change in the interpretation or administration
thereof by any governmental authority, central bank or comparable agency
charged with the interpretation or administration thereof, or compliance by any
Bank (or its Lending Office) with any request or directive (whether or not
having the force of law) of any such authority, central bank or comparable
agency:
(i) shall subject any Bank (or its Lending Office) to any
tax, duty or other charge with respect to its Eurodollar Loans or
Fixed Rate Loans, its Notes, its Letter(s) of Credit, or its
participation in any thereof, any Reimbursement Obligations owed to it
or its obligation to make Eurodollar Loans or Fixed Rate Loans, issue
a Letter of Credit, or to participate therein, or shall change the
basis of taxation of payments to any Bank (or its Lending Office) of
the principal of or interest on its Eurodollar Loans, Letter(s) of
Credit, or participations therein or any other amounts due under this
Agreement or any other Loan Document in respect of its Eurodollar
Loans or Fixed Rate Loans, Letter(s) of Credit, any participation
therein, any Reimbursement Obligations owed to it, or its obligation
to make Eurodollar Loans or Fixed Rate Loans, or issue a Letter of
Credit, or acquire participations therein (except for changes in the
rate of tax on the overall net income of such Bank or its Lending
Office imposed by the jurisdiction in which such Bank's principal
executive office or Lending Office is located); or
(ii) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement (including, without limitation,
any such requirement imposed by the Board of Governors of the Federal
Reserve System, but excluding with respect to any Eurodollar Loans or
Fixed Rate Loans any such requirement included in an applicable
Eurodollar Reserve Percentage) against assets of, deposits with or for
the account of, or credit extended by, any Bank (or its Lending
Office) or shall impose on any Bank (or its Lending Office) or on the
interbank market any other condition affecting its Eurodollar Loans or
Fixed Rate Loans, its Notes, its Letter(s) of Credit, or its
participation in any thereof, any Reimbursement Obligation owed to it,
or its obligation to make Eurodollar Loans or Fixed Rate Loans, or to
issue a Letter of Credit, or to participate therein;
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and the result of any of the foregoing is to increase the cost to such Bank (or
its Lending Office) of making or maintaining any Eurodollar Loan or Fixed Rate
Loan, issuing or maintaining a Letter of Credit, or participating therein, or
to reduce the amount of any sum received or receivable by such Bank (or its
Lending Office) under this Agreement or under any other Loan Document with
respect thereto, by an amount deemed by such Bank to be material, then, within
15 days after demand by such Bank (with a copy to the Agent), the Borrower
shall be obligated to pay to such Bank such additional amount or amounts as
will compensate such Bank for such increased cost or reduction.
(b) If, after the date hereof, any Bank or the Agent shall have
determined that the adoption of any applicable law, rule or regulation
regarding capital adequacy, or any change therein, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Bank (or its Lending Office) with any request or
directive regarding capital adequacy (whether or not having the force of law)
of any such authority, central bank or comparable agency, has had the effect of
reducing the rate of return on such Bank's capital as a consequence of its
obligations hereunder to a level below that which such Bank could have achieved
but for such adoption, change or compliance (taking into consideration such
Bank's policies with respect to capital adequacy) by an amount deemed by such
Bank to be material, then from time to time, within 15 days after demand by
such Bank (with a copy to the Agent), the Borrower shall pay to such Bank such
additional amount or amounts as will compensate such Bank for such reduction.
(c) A certificate of a Bank claiming compensation under this
Section 9.3 and setting forth the additional amount or amounts to be paid to it
hereunder shall be conclusive if reasonably determined. In determining such
amount, such Bank may use any reasonable averaging and attribution methods.
Section 10.4. Lending Offices. Each Bank may, at its option,
elect to make its Loans hereunder at the branch, office or affiliate specified
on the appropriate signature page hereof (each a "Lending Office") for each
type of Loan available hereunder or at such other of its branches, offices or
affiliates as it may from time to time elect and designate in a written notice
to the Borrower and the Agent.
Section 10.5. Discretion of Bank as to Manner of Funding.
Notwithstanding any other provision of this Agreement, each Bank shall be
entitled to fund and maintain its funding of all or any part of its Loans in
any manner it sees fit, it being understood, however, that for the purposes of
this Agreement all determinations hereunder with respect to Eurodollar Loans
shall be made as if each Bank had actually funded and maintained each
Eurodollar Loan through the purchase of deposits in the interbank eurodollar
market having a maturity corresponding to such Loan's Interest Period and
bearing an interest rate equal to LIBOR for such Interest Period.
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SECTION 11. THE AGENT.
Section 11.1. Appointment and Authorization of Agent. Each Bank
hereby appoints Bank of Montreal as the Agent under the Loan Documents and
hereby authorizes the Agent to take such action as Agent on its behalf and to
exercise such powers under the Loan Documents as are delegated to the Agent by
the terms thereof, together with such powers as are reasonably incidental
thereto. The Banks expressly agree that the Agent is not acting as a fiduciary
of the Banks in respect of the Loan Documents, the Borrower or otherwise, and
nothing herein or in any of the other Loan Documents shall result in any duties
or obligations on the Agent or any of the Banks except as expressly set forth
herein.
Section 11.2. Agent and its Affiliates. The Agent shall have the
same rights and powers under this Agreement and the other Loan Documents as any
other Bank and may exercise or refrain from exercising such rights and power as
though it were not the Agent, and the Agent and its affiliates may accept
deposits from, lend money to, and generally engage in any kind of business with
the Borrower or any Affiliate of the Borrower as if it were not the Agent under
the Loan Documents. The term "Bank" as used herein and in all other Loan
Documents, unless the context otherwise clearly requires, includes the Agent in
its individual capacity as a Bank. References in Section 1 hereof to the
Agent's Loans, or to the amount owing to the Agent for which an interest rate
is being determined, refer to the Agent in its individual capacity as a Bank.
Section 11.3. Action by Agent. If the Agent receives from the
Borrower a written notice of an Event of Default pursuant to Section 8.5
hereof, the Agent shall promptly give each of the Banks written notice thereof.
The obligations of the Agent under the Loan Documents are only those expressly
set forth therein. Without limiting the generality of the foregoing, the Agent
shall not be required to take any action hereunder with respect to any Default
or Event of Default, except as expressly provided in Sections 9.2 and 9.5.
Upon the occurrence of an Event of Default, the Agent shall take such action to
enforce its Lien on the Collateral and to preserve and protect the Collateral
as may be directed by the Required Banks. Unless and until the Required Banks
give such direction, the Agent may (but shall not be obligated to) take or
refrain from taking such actions as it deems appropriate and in the best
interest of all the Banks. In no event, however, shall the Agent be required
to take any action in violation of applicable law or of any provision of any
Loan Document, and the Agent shall in all cases be fully justified in failing
or refusing to act hereunder or under any other Loan Document unless it first
receives any further assurances of its indemnification from the Banks that it
may require, including prepayment of any related expenses and any other
protection it requires against any and all costs, expense, and liability which
may be incurred by it by reason of taking or continuing to take any such
action. The Agent shall be entitled to assume that no Default or Event of
Default exists unless notified in writing to the contrary by a Bank or the
Borrower. In all cases in which the Loan Documents do not require the Agent to
take specific action, the Agent shall be fully justified in using its
discretion in failing to take or in taking any action thereunder. Any
instructions of the Required Banks, or of any other group of Banks called for
under the specific provisions of the Loan Documents, shall be binding upon all
the Banks and the holders of the Obligations.
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Section 11.4. Consultation with Experts. The Agent may consult
with legal counsel, independent public accountants and other experts selected
by it and shall not be liable for any action taken or omitted to be taken by it
in good faith in accordance with the advice of such counsel, accountants or
experts.
Section 11.5. Liability of Agent; Credit Decision. Neither the
Agent nor any of its directors, officers, agents, or employees shall be liable
for any action taken or not taken by it in connection with the Loan Documents:
(i) with the consent or at the request of the Required Banks or (ii) in the
absence of its own gross negligence or willful misconduct. Neither the Agent
nor any of its directors, officers, agents or employees shall be responsible
for or have any duty to ascertain, inquire into or verify: (i) any statement,
warranty or representation made in connection with this Agreement, any other
Loan Document or any Credit Event; (ii) the performance or observance of any of
the covenants or agreements of the Borrower or any Subsidiary contained herein
or in any other Loan Document; (iii) the satisfaction of any condition
specified in Section 7 hereof, except receipt of items required to be delivered
to the Agent; or (iv) the validity, effectiveness, genuineness, enforceability,
perfection, value, worth or collectibility hereof or of any other Loan Document
or of any other documents or writing furnished in connection with any Loan
Document or of any Collateral; and the Agent makes no representation of any
kind or character with respect to any such matter mentioned in this sentence.
The Agent may execute any of its duties under any of the Loan Documents by or
through employees, agents, and attorneys-in-fact and shall not be answerable to
the Banks, the Borrower, or any other Person for the default or misconduct of
any such agents or attorneys-in-fact selected with reasonable care, except for
its gross negligence or willful misconduct. The Agent shall not incur any
liability by acting in reliance upon any notice, consent, certificate, other
document or statement (whether written or oral) believed by it to be genuine or
to be sent by the proper party or parties. In particular and without limiting
any of the foregoing, the Agent shall have no responsibility for confirming the
accuracy of any compliance certificate or other document or instrument received
by it under the Loan Documents. The Agent may treat the payee of any Note as
the holder thereof until written notice of transfer shall have been filed with
the Agent signed by such payee in form satisfactory to the Agent. Each Bank
acknowledges that it has independently and without reliance on the Agent or any
other Bank, and based upon such information, investigations and inquiries as it
deems appropriate, made its own credit analysis and decision to extend credit
to the Borrower in the manner set forth in the Loan Documents. It shall be the
responsibility of each Bank to keep itself informed as to the creditworthiness
of the Borrower and its Subsidiaries, and the Agent shall have no liability to
any Bank with respect thereto.
Section 11.6. Indemnity. The Banks shall ratably, in accordance
with their respective Percentages, indemnify and hold the Agent, and its
directors, officers, employees, agents and representatives harmless from and
against any liabilities, losses, costs or expenses suffered or incurred by it
under any Loan Document or in connection with the transactions contemplated
thereby, regardless of when asserted or arising, except to the extent they are
promptly reimbursed for the same by the Borrower and except to the extent that
any event giving rise to a claim was caused by the gross negligence or willful
misconduct of the party seeking to be indemnified. The obligations of the
Banks under this Section shall survive termination of this Agreement.
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Section 11.7. Resignation of Agent and Successor Agent. The
Agent may resign at any time by giving written notice thereof to the Banks and
the Borrower. Upon any such resignation of the Agent, the Required Banks shall
have the right to appoint a successor Agent. If no successor Agent shall have
been so appointed by the Required Banks, and shall have accepted such
appointment, within 30 days after the retiring Agent's giving of notice of
resignation then the retiring Agent may, on behalf of the Banks, appoint a
successor Agent, which shall be any Bank hereunder or any commercial bank
organized under the laws of the United States of America or of any State
thereof and having a combined capital and surplus of at least $200,000,000.
Upon the acceptance of its appointment as the Agent hereunder, such successor
Agent shall thereupon succeed to and become vested with all the rights and
duties of the retiring Agent under the Loan Documents, and the retiring Agent
shall be discharged from its duties and obligations thereunder. After any
retiring Agent's resignation hereunder as Agent, the provisions of this Section
11 and all protective provisions of the other Loan Documents shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Agent.
SECTION 12. MISCELLANEOUS.
Section 12.1. Withholding Taxes. (a) Payments Free of
Withholding. Except as otherwise required by law and subject to Section
12.1(b) hereof, each payment by the Borrower under this Agreement or the other
Loan Documents shall be made without withholding for or on account of any
present or future taxes (other than overall net income taxes on the recipient)
imposed by or within the jurisdiction in which the Borrower is domiciled, any
jurisdiction from which the Borrower makes any payment, or (in each case) any
political subdivision or taxing authority thereof or therein. If any such
withholding is so required, the Borrower shall make the withholding, pay the
amount withheld to the appropriate governmental authority before penalties
attach thereto or interest accrues thereon and forthwith pay such additional
amount as may be necessary to ensure that the net amount actually received by
each Bank and the Agent free and clear of such taxes (including such taxes on
such additional amount) is equal to the amount which that Bank or the Agent (as
the case may be) would have received had such withholding not been made. If
the Agent or any Bank pays any amount in respect of any such taxes, penalties
or interest, the Borrower shall reimburse the Agent or such Bank for that
payment on demand in the currency in which such payment was made. If the
Borrower pays any such taxes, penalties or interest, it shall deliver official
tax receipts evidencing that payment or certified copies thereof to the Bank or
Agent on whose account such withholding was made (with a copy to the Agent if
not the recipient of the original) on or before the thirtieth day after
payment.
(b) U.S. Withholding Tax Exemptions. Each Bank that is not a
United States person (as such term is defined in Section 7701(a)(30) of the
Code) shall submit to the Borrower and the Agent on or before the earlier of
the date the initial Borrowing is made hereunder and 30 days after the date
hereof, two duly completed and signed copies of either Form 1001 (relating to
such Bank and entitling it to a complete exemption from withholding under the
Code on all amounts to be received by such Bank, including fees, pursuant to
the Loan Documents and the Loans) or Form 4224 (relating to all amounts to be
received by such Bank, including fees, pursuant to the Loan Documents and the
Loans) of the United States Internal
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Revenue Service. Thereafter and from time to time, each Bank shall submit to
the Borrower and the Agent such additional duly completed and signed copies of
one or the other of such Forms (or such successor forms as shall be adopted
from time to time by the relevant United States taxing authorities) as may be
(i) requested by the Borrower in a written notice, directly or through the
Agent, to such Bank and (ii) required under then-current United States law or
regulations to avoid or reduce United States withholding taxes on payments in
respect of all amounts to be received by such Bank, including fees, pursuant to
the Loan Documents or the Loans.
(c) Inability of Bank to Submit Forms. If any Bank determines, as
a result of any change in applicable law, regulation or treaty, or in any
official application or interpretation thereof, that it is unable to submit to
the Borrower or the Agent any form or certificate that such Bank is obligated
to submit pursuant to subsection (b) of this Section 12.1 or that such Bank is
required to withdraw or cancel any such form or certificate previously
submitted or any such form or certificate otherwise becomes ineffective or
inaccurate, such Bank shall promptly notify the Borrower and Agent of such fact
and the Bank shall to that extent not be obligated to provide any such form or
certificate and will be entitled to withdraw or cancel any affected form or
certificate, as applicable.
Section 12.2. No Waiver, Cumulative Remedies. No delay or
failure on the part of the Agent or any Bank or on the part of the holder or
holders of any of the Obligations in the exercise of any power or right under
any Loan Document shall operate as a waiver thereof or as an acquiescence in
any default, nor shall any single or partial exercise of any power or right
preclude any other or further exercise thereof or the exercise of any other
power or right. The rights and remedies hereunder of the Agent, the Banks and
of the holder or holders of any of the Obligations are cumulative to, and not
exclusive of, any rights or remedies which any of them would otherwise have.
Section 12.3. Non-Business Days. If any payment hereunder
becomes due and payable on a day which is not a Business Day, the due date of
such payment shall be extended to the next succeeding Business Day on which
date such payment shall be due and payable. In the case of any payment of
principal falling due on a day which is not a Business Day, interest on such
principal amount shall continue to accrue during such extension at the rate per
annum then in effect, which accrued amount shall be due and payable on the next
scheduled date for the payment of interest.
Section 12.4. Documentary Taxes. The Borrower agrees to pay on
demand any documentary, stamp or similar taxes payable in respect of this
Agreement or any other Loan Document, including interest and penalties, in the
event any such taxes are assessed, irrespective of when such assessment is made
and whether or not any credit is then in use or available hereunder.
Section 12.5. Survival of Representations. All representations
and warranties made herein or in any other Loan Document or in certificates
given pursuant hereto or thereto shall survive the execution and delivery of
this Agreement and the other Loan Documents, and shall
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continue in full force and effect with respect to the date as of which they
were made as long as any credit is in use or available hereunder.
Section 12.6. Survival of Indemnities. All indemnities and other
provisions relative to reimbursement to the Banks of amounts sufficient to
protect the yield of the Banks with respect to the Loans and Letters of Credit,
including, but not limited to, Sections 1.12, 10.3 and 12.15 hereof, shall
survive the termination of this Agreement and the other Loan Documents and the
payment of the Obligations.
Section 12.7. Sharing of Set-Off. Each Bank agrees with each
other Bank a party hereto that if such Bank shall receive and retain any
payment, whether by set-off or application of deposit balances or otherwise, on
any of the Loans or Reimbursement Obligations in excess of its ratable share of
payments on all such Obligations then outstanding to the Banks, then such Bank
shall purchase for cash at face value, but without recourse, ratably from each
of the other Banks such amount of the Loans or Reimbursement Obligations, or
participations therein, held by each such other Banks (or interest therein) as
shall be necessary to cause such Bank to share such excess payment ratably with
all the other Banks; provided, however, that if any such purchase is made by
any Bank, and if such excess payment or part thereof is thereafter recovered
from such purchasing Bank, the related purchases from the other Banks shall be
rescinded ratably and the purchase price restored as to the portion of such
excess payment so recovered, but without interest. For purposes of this
Section, amounts owed to or recovered by, the Agent in connection with
Reimbursement Obligations in which Banks have been required to fund their
participation shall be treated as amounts owed to or recovered by the Agent as
a Bank hereunder.
Section 12.8. Notices. Except as otherwise specified herein, all
notices hereunder and under the other Loan Documents shall be in writing
(including, without limitation, notice by telecopy) and shall be given to the
relevant party at its address or telecopier number set forth below, or such
other address or telecopier number as such party may hereafter specify by
notice to the Agent and the Borrower given by courier, by United States
certified or registered mail, by telecopy or by other telecommunication device
capable of creating a written record of such notice and its receipt. Notices
under the Loan Documents to the Banks and the Agent shall be addressed to their
respective addresses or telecopier numbers set forth on the signature pages
hereof, and to the Borrower to:
Vision Twenty-One, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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with notices of any Event of Default also sent to:
▇▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Each such notice, request or other communication shall be effective (i) if
given by telecopier, when such telecopy is transmitted to the telecopier number
specified in this Section or on the signature pages hereof and a confirmation
of such telecopy has been received by the sender, (ii) if given by mail, 5 days
after such communication is deposited in the mail, certified or registered with
return receipt requested, addressed as aforesaid or (iii) if given by any other
means, when delivered at the addresses specified in this Section or on the
signature pages hereof; provided that any notice given pursuant to Section 1
hereof shall be effective only upon receipt.
Section 12.9. Counterparts. This Agreement may be executed in
any number of counterparts, and by the different parties hereto on separate
counterpart signature pages, and all such counterparts taken together shall be
deemed to constitute one and the same instrument.
Section 12.10. Successors and Assigns. This Agreement shall be
binding upon the Borrower and its successors and assigns, and shall inure to
the benefit of the Agent and each of the Banks and the benefit of their
respective successors and assigns, including any subsequent holder of any of
the Obligations. The Borrower may not assign any of its rights or obligations
under any Loan Document without the written consent of all of the Banks.
Section 12.11. Participants. Each Bank shall have the right at
its own cost to grant participations (to be evidenced by one or more agreements
or certificates of participation) in the Loans made and Reimbursement
Obligations and/or Commitments held by such Bank at any time and from time to
time to one or more other Persons; provided that no such participation shall
relieve any Bank of any of its obligations under this Agreement, and, provided,
further that no such participant shall have any rights under this Agreement
except as provided in this Section, and the Agent shall have no obligation or
responsibility to such participant. Any agreement pursuant to which such
participation is granted shall provide that the granting Bank shall retain the
sole right and responsibility to enforce the obligations of the Borrower under
this Agreement and the other Loan Documents including, without limitation, the
right to approve any amendment, modification or waiver of any provision of the
Loan Documents, except that such agreement may provide that such Bank will not
agree to any modification, amendment or waiver of the Loan Documents that would
reduce the amount of or postpone any fixed date for payment of any Obligation
in which such participant has an interest. Any party to which such a
participation has been granted shall have the benefits of Section 1.12 and
Section 10.3 hereof. The Borrower authorizes each Bank to disclose to any
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participant or prospective participant under this Section any financial or
other information pertaining to the Borrower.
Section 12.12. Assignment of Commitments by Banks. Each Bank
shall have the right at any time, with the prior consent of the Agent and, so
long as no Event of Default then exists, the Borrower (which consent of the
Borrower shall not be unreasonably withheld-it being agreed that the Borrower's
consent shall not be required during the existence of any Event of Default), to
sell, assign, transfer or negotiate all or any part of its Commitments
(including the same percentage of its Notes, outstanding Loans and
Reimbursement Obligations owed to it) to one or more commercial banks or other
financial institutions, provided that such assignment shall be of a fixed
percentage (and not by its terms of varying percentage) of the assigning Bank's
Commitments; provided, however, that in order to make any such assignment (i)
unless the assignee Bank is assigning all of its Commitments, the assigning
Bank shall retain at least $5,000,000 in Commitments, (ii) the assignee bank
shall have Commitments of at least $5,000,000, (iii) each such assignment shall
be evidenced by a written agreement (substantially in the form attached hereto
as Exhibit H or in such other form acceptable to the Agent) executed by such
assigning Bank, such assignee bank or banks, the Agent and, if required as
provided above, the Borrower, which agreement shall specify in each instance
the portion of the Obligations which are to be assigned to the assignee bank
and the portion of the Commitments of the assigning Bank to be assumed by the
assignee bank or banks, and (iv) the assigning Bank shall pay to the Agent a
processing fee of $3,500 and any out-of-pocket attorneys' fees and expenses
incurred by the Agent in connection with any such assignment agreement. Any
such assignee shall become a Bank for all purposes hereunder to the extent of
the Commitments it assumes and the assigning Bank shall be released from its
obligations, and will have released its rights, under the Loan Documents to the
extent of such assignment. The Borrower authorizes each Bank to disclose to
any purchaser or prospective purchaser of an interest in the Loans and
Reimbursement Obligations owed to it or its Commitments under this Section any
financial or other information pertaining to the Borrower.
Section 12.13. Amendments. Any provision of this Agreement or the
other Loan Documents may be amended or waived if, but only if, such amendment
or waiver is in writing and is signed by (a) the Borrower, (b) the Required
Banks, and (c) if the rights or duties of the Agent are affected thereby, the
Agent; provided that:
(i) no amendment or waiver pursuant to this Section 12.13
shall (A) increase any Commitment of any Bank without the consent of
such Bank or (B) reduce the amount of or postpone the date for payment
of any principal of or interest on any Loan or of any Reimbursement
Obligation or of any fee payable hereunder without the consent of the
Bank to which such payment is owing or which has committed to make
such Loan or Letter of Credit (or participate therein) hereunder; and
(ii) no amendment or waiver pursuant to this Section 12.13
shall, unless signed by each Bank, change the definitions of Revolving
Credit Termination Date, Term Credit Termination Date, Term Credit
Final Maturity Date, or Required Banks, change the provisions of this
Section 12.13, Section 7, Section 9, release any guarantor or all or
any substantial part of the Collateral (except as otherwise provided
for in the Loan
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Documents), or affect the number of Banks required to take any
action hereunder or under any other Loan Document.
Section 12.14. Headings. Section headings used in this Agreement
are for reference only and shall not affect the construction of this Agreement.
Section 12.15. Costs and Expenses. The Borrower agrees to pay all
reasonable costs and out-of-pocket expenses of the Agent in connection with the
preparation, negotiation, and administration of the Loan Documents, including,
without limitation, the reasonable fees and disbursements of counsel to the
Agent, in connection with the preparation and execution of the Loan Documents,
and any amendment, waiver or consent related thereto, whether or not the
transactions contemplated herein are consummated. The Borrower further agrees
to indemnify the Agent, each Bank, and their respective directors, officers and
employees, against all losses, claims, damages, penalties, judgments,
liabilities and expenses (including, without limitation, all reasonable
expenses of litigation or preparation therefor, whether or not the indemnified
Person is a party thereto) which any of them may pay or incur arising out of or
relating to any Loan Document or any of the transactions contemplated thereby
or the direct or indirect application or proposed application of the proceeds
of any Loan or Letter of Credit, other than those which arise from the gross
negligence or willful misconduct of the party claiming indemnification. The
Borrower, upon demand by the Agent or a Bank at any time, shall reimburse the
Agent or such Bank for any legal or other expenses incurred in connection with
investigating or defending against any of the foregoing (including any
settlement costs relating to the foregoing) except if the same is directly due
to the gross negligence or willful misconduct of the party to be indemnified.
The obligations of the Borrower under this Section shall survive the
termination of this Agreement.
Section 12.16. Set-off. In addition to any rights now or
hereafter granted under applicable law and not by way of limitation of any such
rights, upon the occurrence of any Event of Default, each Bank and each
subsequent holder of any Obligation is hereby authorized by the Borrower at any
time or from time to time, without notice to the Borrower or to any other
Person, any such notice being hereby expressly waived, to set-off and to
appropriate and to apply any and all deposits (general or special, including,
but not limited to, indebtedness evidenced by certificates of deposit, whether
matured or unmatured, but not including trust accounts, and in whatever
currency denominated) and any other indebtedness at any time held or owing by
that Bank or that subsequent holder to or for the credit or the account of the
Borrower, whether or not matured, against and on account of the Obligations of
the Borrower to that Bank or that subsequent holder under the Loan Documents,
including, but not limited to, all claims of any nature or description arising
out of or connected with the Loan Documents, irrespective of whether or not (a)
that Bank or that subsequent holder shall have made any demand hereunder or (b)
the principal of or the interest on the Loans or Notes and other amounts due
hereunder shall have become due and payable pursuant to Section 9 and although
said obligations and liabilities, or any of them, may be contingent or
unmatured. Any Bank exercising any such right of set-off shall endeavor in
good faith to give the Borrower notice after effecting any such set-off;
however such Bank shall in no event be liable to the Borrower for such Bank's
failure to do so and its failure to do so shall not affect the validity of any
such set-off.
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Section 12.17. Entire Agreement. The Loan Documents constitute
the entire understanding of the parties thereto with respect to the subject
matter thereof and any prior agreements, whether written or oral, with respect
thereto are superseded hereby.
Section 12.18. Governing Law. This Agreement and the other Loan
Documents, and the rights and duties of the parties hereto, shall be construed
and determined in accordance with the internal laws of the State of Illinois.
Section 12.19. Severability of Provisions. Any provision of any
Loan Document which is unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
Section 12.20. Excess Interest. Notwithstanding any provision to
the contrary contained herein or in any other Loan Document, no such provision
shall require the payment or permit the collection of any amount in excess of
the maximum amount of interest permitted by applicable law to be charged for
the use or detention, or the forbearance in the collection, of all or any
portion of the Loans or other obligations outstanding under this Agreement or
any other Loan Document ("Excess Interest"). If any Excess Interest is
provided for, or is adjudicated to be provided for, herein or in any other Loan
Document, then in such event (a) the provisions of this Section 12.20 shall
govern and control; (b) neither the Borrower nor any guarantor or endorser
shall be obligated to pay any Excess Interest; (c) any Excess Interest that the
Agent or any Bank may have received hereunder shall, at the option of the
Agent, be (i) applied as a credit against the then outstanding principal amount
of Loans hereunder, accrued and unpaid interest thereon (not to exceed the
maximum amount permitted by applicable law) and any other obligations, or all
of the foregoing; (ii) refunded to the Borrower, or (iii) any combination of
the foregoing; (d) the interest rate payable hereunder or under any other Loan
Document shall be automatically subject to reduction to the maximum lawful
contract rate allowed under applicable usury laws, and this Agreement and the
other Loan Documents shall be deemed to have been, and shall be, reformed and
modified to reflect such reduction in the relevant interest rate; and (e)
neither the Borrower nor any guarantor or endorser shall have any action
against the Agent or any Bank for any damages whatsoever arising out of the
payment or collection of any Excess Interest.
Section 12.21. Confidentiality. Any information disclosed by the
Borrower or any of its Subsidiaries to the Agent or any Bank which was
designated proprietary or confidential at the time of its receipt by the Agent
or such Bank, and which it is not otherwise in the public domain, shall not be
disclosed by the Agent or such Bank to any other Person except (i) to its
independent accountants and legal counsel (it being understood that the Persons
to whom such disclosure is made will be informed of the confidential nature of
such information and instructed to keep such information confidential), (ii)
pursuant to statutory and regulatory requirements, (iii) pursuant to any
mandatory court order, subpoena or other legal process, (iv) to the Agent or
any other Bank, (v) pursuant to any agreement heretofore or hereafter made
between such Bank and the Borrower which permits such disclosure, (vi) in
connection with the exercise of any remedy under the Loan Documents, or (vii)
subject to an agreement
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containing provisions substantially the same as those of this Section, to any
participant in or assignee of, or prospective participant in or assignee of,
any Obligation or Commitments.
Section 12.22. Single Bank. If and so long as Bank of Montreal is
the only Bank hereunder, Bank of Montreal shall have all rights, powers and
privileges afforded to the Agent, the Banks, and the Required Banks hereunder
and under the other Loan Documents.
Section 12.23. Submission to Jurisdiction; Waiver of Jury Trial.
The Borrower hereby submits to the nonexclusive jurisdiction of the United
States District Court for the Northern District of Illinois and of any Illinois
State court sitting in the City of Chicago for purposes of all legal
proceedings arising out of or relating to this Agreement, the other Loan
Documents or the transactions contemplated hereby or thereby. The Borrower
irrevocably waives, to the fullest extent permitted by law, any objection which
it may now or hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in such
a court has been brought in an inconvenient forum. THE BORROWER, THE AGENT AND
EACH BANK HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED THEREBY.
[SIGNATURE PAGES TO FOLLOW]
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Upon your acceptance hereof in the manner hereinafter set forth, this
Agreement shall constitute a contract between us for the uses and purposes
hereinabove set forth.
Dated as of this 30th day of January, 1998.
VISION TWENTY-ONE, INC.
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Financial Officer
Accepted and agreed to as of the day and year last above written.
BANK OF MONTREAL, in its individual
capacity as a Bank and as Agent
Address and Amount of Commitments: By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Address: Title: Director
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
with notices of Borrowing requests to:
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Revolving Credit Commitment:
$10,000,000
Term Credit Commitment:
$40,000,000
Lending Offices:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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EXHIBIT A
NOTICE OF PAYMENT REQUEST
[Date]
[Name of Bank]
[Address]
Attention:
Reference is made to the Credit Agreement, dated as of January 30,
1998, among Vision Twenty-One, Inc., the Banks party thereto, and Bank of
Montreal, as Agent (the "Credit Agreement"). Capitalized terms used herein and
not defined herein have the meanings assigned to them in the Credit Agreement.
[The Borrower has failed to pay its Reimbursement Obligation in the amount of
$_________. Your Bank's Percentage of the unpaid Reimbursement Obligation is
$_________] or [Bank of Montreal has been required to return a payment by the
Borrower of a Reimbursement Obligation in the amount of $________. Your Bank's
Percentage of the returned Reimbursement Obligation is $_________.]
Very truly yours,
BANK OF MONTREAL, as Agent
By
---------------------------------
Its
-----------------------------
73
EXHIBIT B
REVOLVING NOTE
U.S. $_______________ ________________, 19___
FOR VALUE RECEIVED, the undersigned, VISION TWENTY-ONE, INC., a
Florida corporation (the "Borrower"), hereby promises to pay to the order of
______________________ (the "Bank") on the Revolving Credit Termination Date of
the hereinafter defined Credit Agreement, at the principal office of Bank of
Montreal, in as Agent, Chicago, Illinois, in immediately available funds, the
principal sum of ___________________ Dollars ($__________) or, if less, the
aggregate unpaid principal amount of all Revolving Loans made by the Bank to
the Borrower pursuant to the Credit Agreement, together with interest on the
principal amount of each Revolving Loan from time to time outstanding hereunder
at the rates, and payable in the manner and on the dates, specified in the
Credit Agreement.
The Bank shall record on its books or records or on a schedule
attached to this Note, which is a part hereof, each Revolving Loan made by it
pursuant to the Credit Agreement, together with all payments of principal and
interest and the principal balances from time to time outstanding hereon,
whether the Revolving Loan is a Base Rate Loan or a Eurodollar Loan, the
interest rate and Interest Period applicable thereto, provided that prior to
the transfer of this Note all such amounts shall be recorded on a schedule
attached to this Note. The record thereof, whether shown on such books or
records or on a schedule to this Note, shall be prima facie evidence of the
same, provided, however, that the failure of the Bank to record any of the
foregoing or any error in any such record shall not limit or otherwise affect
the obligation of the Borrower to repay all Revolving Loans made to it pursuant
to the Credit Agreement together with accrued interest thereon.
This Note is one of the Revolving Notes referred to in the Credit
Agreement dated as of January 30, 1998, among the Borrower, Bank of Montreal,
as Agent, and the Banks party thereto (the "Credit Agreement"), and this Note
and the holder hereof are entitled to all the benefits provided for thereby or
referred to therein, to which Credit Agreement reference is hereby made for a
statement thereof. All defined terms used in this Note, except terms otherwise
defined herein, shall have the same meaning as in the Credit Agreement. This
Note shall be governed by and construed in accordance with the internal laws of
the State of Illinois.
Voluntary prepayments may be made hereon, certain prepayments are
required to be made hereon, and this Note may be declared due prior to the
expressed maturity hereof, all in the events, on the terms and in the manner as
provided for in the Credit Agreement.
74
The Borrower hereby waives demand, presentment, protest or notice of
any kind hereunder.
VISION TWENTY-ONE, INC.
By
---------------------------------
Name
-----------------------------
Title
---------------------------
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EXHIBIT C
TERM NOTE
U.S. $________________ _______________, 19___
FOR VALUE RECEIVED, the undersigned, VISION TWENTY-ONE, INC., a
Florida corporation (the "Borrower"), hereby promises to pay to the order of
______________________ (the "Bank") at the principal office of Bank of
Montreal, as Agent, in Chicago, Illinois, in immediately available funds, the
principal sum of ___________________ Dollars ($__________) or, if less, the
aggregate unpaid principal amount of all Term Loans made by the Bank to the
Borrower pursuant to the Credit Agreement, in consecutive quarter-annual
principal installments in the amounts called for by Section 1.8 of the Credit
Agreement, commencing on March 31, 2000, and continuing on the last day of each
June, September, December and March occurring thereafter, together with
interest on the principal amount of each Term Loan from time to time
outstanding hereunder at the rates, and payable in the manner and on the dates,
specified in the Credit Agreement, except that all principal and interest not
sooner paid on the Term Loans shall be due and payable on the Term Credit Final
Maturity Date.
The Bank shall record on its books or records or on a schedule
attached to this Note, which is a part hereof, each Term Loan made by it
pursuant to the Credit Agreement, together with all payments of principal and
interest and the principal balances from time to time outstanding hereon,
whether the Term Loan is a Base Rate Loan or a Eurodollar Loan or a Fixed Rate
Loan, the interest rate and Interest Period applicable thereto, provided that
prior to the transfer of this Note all such amounts shall be recorded on a
schedule attached to this Note. The record thereof, whether shown on such
books or records or on a schedule to this Note, shall be prima facie evidence
of the same, provided, however, that the failure of the Bank to record any of
the foregoing or any error in any such record shall not limit or otherwise
affect the obligation of the Borrower to repay all Loans made to it pursuant to
the Credit Agreement together with accrued interest thereon.
This Note is one of the Term Notes referred to in the Credit Agreement
dated as of January 30, 1998, among the Borrower, Bank of Montreal, as Agent,
and the Banks party thereto (the "Credit Agreement"), and this Note and the
holder hereof are entitled to all the benefits provided for thereby or referred
to therein, to which Credit Agreement reference is hereby made for a statement
thereof. All defined terms used in this Note, except terms otherwise defined
herein, shall have the same meaning as in the Credit Agreement. This Note
shall be governed by and construed in accordance with the internal laws of the
State of Illinois.
Voluntary prepayments may be made hereon, certain prepayments are
required to be made hereon, and this Note may be declared due prior to the
expressed maturity hereof, all in the events, on the terms and in the manner as
provided for in the Credit Agreement.
76
The Borrower hereby waives demand, presentment, protest or notice of
any kind hereunder.
VISION TWENTY-ONE, INC.
By
---------------------------------
Name
----------------------------
Title
---------------------------
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77
EXHIBIT D
COMPLIANCE CERTIFICATE
FOR
VISION TWENTY-ONE, INC.
This Compliance Certificate is furnished to Bank of Montreal, as Agent
(the "Agent") pursuant to that certain Credit Agreement dated as of January 30,
1998, among Vision Twenty-One, Inc. (the "Borrower"), Bank of Montreal, as
Agent, and the Banks party thereto (the "Credit Agreement"). Unless otherwise
defined herein, the terms used in this Compliance Certificate have the meanings
ascribed thereto in the Credit Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected _____________________________
of the Borrower;
2. I have reviewed the terms of the Credit Agreement
and I have made, or have caused to be made under my supervision, a
detailed review of the transactions and conditions of the Borrower
and its Subsidiaries during the accounting period covered by the
attached financial statements;
3. The examinations described in paragraph 2 did not
disclose, and I have no knowledge of, the existence of any condition
or the occurrence of any event which constitutes a Default or Event of
Default during or at the end of the accounting period covered by the
attached financial statements or as of the date of this Certificate,
except as set forth below; and
4. The Attachment hereto sets forth financial data and
computations evidencing the Borrower's compliance with certain
covenants of the Credit Agreement, all of which data and computations
are, to the best of my knowledge, true, complete and correct and have
been made in accordance with the relevant Sections of the Credit
Agreement.
Described below are the exceptions, if any, to paragraph 3 by listing,
in detail, the nature of the condition or event, the period during which it
has existed and the action which the Borrower has taken, is taking, or
proposes to take with respect to each such condition or event:
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
78
The foregoing certifications, together with the computations set forth
in the Attachment hereto and the financial statements delivered with this
Certificate in support hereof, are made and delivered this _________ day of
__________________ 19___.
VISION TWENTY-ONE, INC.
By
-------------------------------
--------------, ---------------
(Name) (Title)
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79
ATTACHMENT TO COMPLIANCE CERTIFICATE
FOR
VISION TWENTY-ONE, INC.
Compliance Calculations for Credit Agreement
Dated as of January 30, 1998
Calculations as of __________, 19___
____________________________________________________________________________
A. Current Ratio (Section 8.6)
1. Consolidated current assets $___________
2. Consolidated current liabilities $___________
3. Ratio of line A1 to A2 ____:1.0
4. Line A3 ratio must be equal to or greater than 1.0:1.0
5. The Borrower is in compliance (circle yes or no) yes/no
B. Total Funded Debt/Adjusted EBITDA Ratio (Section 8.8)
1. Total Funded Debt $___________
2. Net Income (adjusted, pro forma, for
acquisition effect) for past 4 quarters ___________
3. Interest Expense (adjusted, pro forma,
for acquisition effect) for past 4 quarters ___________
4. Taxes (adjusted, pro forma, for acquisition effect)
for past 4 quarters ___________
5. Depreciation, Amortization and other Non-Cash Charges
(adjusted, pro forma, for acquisition effect) for
past 4 quarters ___________
6. ▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇, ▇▇, ▇▇, ▇▇▇ ▇▇ ("▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇")
___________
7. Ratio of Line B1 TO B6 ____:1.0
80
8. Line B7 ratio must not be equal to or greater than ____:1.0
9. The Borrower is in compliance (circle yes or no) yes/no
C. Net Worth (Section 8.9)
1. Net Worth $ ___________
2. Line C1 shall not be less than $___________
3. The Borrower is in compliance (circle yes or no) yes/no
D. Interest Coverage Ratio (Section 8.10)
1. Net Income for past 4 quarters $___________
2. Interest Expense for past 4 quarters $___________
3. Taxes for past 4 quarters $___________
4. Depreciation, Amortization and other Non-Cash Charges
for past 4 quarters $___________
5. Sum of lines D1, D2, D3 and D4 ("EBITDA") $___________
6. Cash interest paid or payable during past 4 quarters $___________
7. Ratio of Line D5 to Line D6 ____:1.0
8. Line D7 ratio must not be less than ____:1.0
9. The Borrower is in compliance (circle yes or no) yes/no
E. Debt Service Coverage Ratio (Section 8.11)
1. EBITDA (Line D5 above) for past 4 quarters $___________
2. Capital Expenditures for past 4 quarters $___________
3. Cash payments in respect of income taxes
for past 4 quarters $___________
4. Line E1 minus Lines E2 and E3 $___________
5. Principal payments for past 4 quarters $__________
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81
6. Interest Expense for past 4 quarters $___________
7. Line E5 plus Line E6 $___________
8. Ratio of Line E4 to Line E7 ____:1.0
9. Line E8 ratio must not be less than ____:1.0
10. The Borrower is in compliance (circle yes or no) yes/no
F. Capital Expenditures (Section 8.12)
1. Capital Expenditures (year-to-date) $___________
2. Line F1 not to exceed $___________
3. The Borrower is in compliance (circle yes or no) yes/no
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82
EXHIBIT E
(LETTERHEAD)
VISION TWENTY-ONE, INC.
Date: ___/___/___
Fax to: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Bank of Montreal
Fax #: ▇▇▇-▇▇▇-▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
RE: VISION TWENTY-ONE, INC.
Request for New Borrowing
Vision Twenty-One, Inc. requests the following activity:
_____ BORROWING AT BASE RATE INTEREST OPTION:
(Notify Agent day of borrowing by 10:00 a.m. Chicago time)
Borrowing Date: ___/___/___ Amount: $_________ Facility: Revolving Credit
Borrowing Date: ___/___/___ Amount: $_________ Facility: Term Credit
_____ BORROWING AT EURODOLLAR RATE INTEREST OPTION:
(Notify Agent 3 days prior to borrowing date by 10:00 a.m. Chicago time)
Facility: Revolving Credit
Borrowing Date: ___/___/___ Amount: $________ Maturity Date: ___/___/___
Borrowing Date: ___/___/___ Amount: $_________ Maturity Date: ___/___/___
Facility: Term Credit
Borrowing Date: ___/___/___ Amount: $________ Maturity Date: ___/___/___
Borrowing Date: ___/___/___ Amount: $________ Maturity Date: ___/___/___
_____ BORROWING AT FIXED RATE INTEREST OPTION--TERM CREDIT ONLY:
(Notify Agent 3 days prior to borrowing date by 10:00 a.m. Chicago time)
Borrowing Date: ___/___/___ Amount: $________ Maturity Date: ___/___/___
Borrowing Date: ___/___/___ Amount: $_________ Maturity Date: ___/___/___
83
Please send the funds requested above using our standard wire transfer
instructions or the following:
Bank:
-------------------------
ABA #:
------------------------
Acct Name:
--------------------
Acct #:
-----------------------
Attn:
-------------------------
From
----------------------------
Name
--------------------------
Title
--------------------------
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84
EXHIBIT F
(LETTERHEAD)
VISION TWENTY-ONE, INC.
Date: ___/___/___
Fax to: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Bank of Montreal
Fax #: ▇▇▇-▇▇▇-▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
RE: VISION TWENTY-ONE, INC.
Rollover/Conversion Request
Vision Twenty-One, Inc. requests the following activity:
_____ ROLLOVER EURODOLLAR CONTRACT:
Maturing Eurodollar Contract:
Amount: $____________ Facility:________________ Maturity Date ___/___/___
Interest Due: Agent will inform Vision Twenty-One, Inc.
Increase/Decrease Amount (if applicable): $______________
Please initiate a NEW EURODOLLAR Contract(s) as follows:
Amount $____________ New Maturity Date: ___/___/___
Amount $____________ New Maturity Date: ___/___/___
_____ CONVERT MATURING EURODOLLAR CONTRACT TO BASE RATE OPTION:
Maturing Eurodollar Contract:
Amount: $____________ Facility:________________ Maturity Date ___/___/___
Interest Due: Agent will inform Vision Twenty-One, Inc.
Please convert the amount given below to the base Rate Interest Option::
Amount $____________ Repayment Amount (if applicable): $____________
Interest Due: Agent will inform Vision Twenty-One, Inc.
_____ CONVERT BASE RATE FUNDS TO NEW EURODOLLOAR CONTRACT:
Base Rate Funds:
Amount: $____________ Facility:________________ Effective Date ___/___/___
Repayment Amount (if applicable):________________
Interest Due: Agent will inform Vision Twenty-One, Inc.
Please initiate a NEW EURODOLLAR Contract(s) as follows:
Amount $____________ New Maturity Date: ___/___/___
Amount $____________ New Maturity Date: ___/___/___
From
----------------------------
Name
--------------------------
Title
--------------------------
85
EXHIBIT G
(LETTERHEAD)
VISION TWENTY-ONE, INC.
Date: ___/___/___
Fax to: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Bank of Montreal
Fax #: ▇▇▇-▇▇▇-▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
RE: VISION TWENTY-ONE, INC.
Notice of Repayment
Vision Twenty-One, Inc. requests the following activity:
_____ REPAYMENT OF OUTSTANDING BORROWINGS UNDER BASE RATE OPTION:
(Notify Agent day of repayment by 10:00 a.m. Chicago time. Funds must be
received by 12:00 noon Chicago time day of repayment.)
Repayment Date: ___/___/___ Amount: $___________ Facility: Revolving Credit
Repayment Date: ___/___/___ Amount: $___________ Facility: Term Credit
_____ REPAYMENT OF OUTSTANDING BORROWINGS UNDER EURODOLLAR OPTION:
(Notify Agent 3 Days prior to repayment and Receive Funds by 12:00 noon Chicago
time day of repayment)
Facility: Revolving Credit
Repayment Date: ___/___/___ Amount: $___________ Maturity Date: ___/___/___
Repayment Date: ___/___/___ Amount: $___________ Maturity Date: ___/___/___
Facility: Term Credit
Repayment Date: ___/___/___ Amount: $___________ Maturity Date: ___/___/___
Repayment Date: ___/___/___ Amount: $___________ Maturity Date: ___/___/___
_____ REPAYMENT OF OUTSTANDING BORROWINGS UNDER FIXED RATE OPTION
(Notify Agent 3 Days prior to repayment and Receive funds by 12:00 noon Chicago time
day of repayment)
Facility: Term Credit
Repayment Date: ___/___/___ Amount: $___________ Maturity Date: ___/___/___
Repayment Date: ___/___/___ Amount: $___________ Maturity Date: ___/___/___
From
----------------------------
Name
--------------------------
Title
--------------------------
86
EXHIBIT H
ASSIGNMENT AND ACCEPTANCE
Dated _____________, 19_____
Reference is made to the Credit Agreement dated as of January 30, 1998
(the "Credit Agreement") among Vision Twenty-One, Inc., a Florida corporation,
the Banks (as defined in the Credit Agreement) and Bank of Montreal, as Agent
for the Banks (the "Agent"). Terms defined in the Credit Agreement are used
herein with the same meaning.
_____________________________________________________ (the "Assignor")
and _________________________ (the "Assignee") agree as follows:
1. The Assignor hereby sells and assigns to the
Assignee, and the Assignee hereby purchases and assumes from the
Assignor, a _______% interest in and to all of the Assignor's rights
and obligations under the Credit Agreement as of the Effective Date (as
defined below), including, without limitation, such percentage interest
in the Assignor's Commitments as in effect on the Effective Date and
the Loans, if any, owing to the Assignor on the Effective Date and the
Assignor's Percentage of any outstanding L/C Obligations.
2. The Assignor (i) represents and warrants that as of
the date hereof (A) its Revolving Credit Commitment is $_____________
and its Term Credit Commitment is $____________, (B) the aggregate
outstanding principal amount of Loans made by it under the Credit
Agreement that have not been repaid is $____________ ($_____________
of Revolving Loans and $_____________ of Term Loans) and a description
of the interest rates and interest periods of such Loans is attached
as Schedule 1 hereto, and (C) the aggregate principal amount of
Assignor's Percentage of outstanding L/C Obligations is $____________;
(ii) represents and warrants that it is the legal and beneficial owner
of the interest being assigned by it hereunder and that such interest
is free and clear of any adverse claim, lien, or encumbrance of any
kind; (iii) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement or
the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Credit Agreement or any other instrument
or document furnished pursuant thereto; and (iv) makes no
representation or warranty and assumes no responsibility with respect
to the financial condition of the Borrower or any Subsidiary or the
performance or observance by the Borrower or any Subsidiary of any of
its obligations under the Credit Agreement or any other instrument or
document furnished pursuant thereto.
3. The Assignee (i) confirms that it has received a copy
of the Credit Agreement, together with copies of the financial
statements referred to in Section 6.5 thereof and such other documents
and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Acceptance;
87
(ii) agrees that it will, independently and without reliance upon the
Agent, the Assignor or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make
its own credit decisions in taking or not taking action under the
Credit Agreement; (iii) appoints and authorizes the Agent to take such
action as Agent on its behalf and to exercise such powers under the
Credit Agreement as are delegated to the Agent by the terms thereof,
together with such powers as are reasonably incidental thereto; (iv)
agrees that it will perform in accordance with their terms all of the
obligations which by the terms of the Credit Agreement are required to
be performed by it as a Bank; and (v) specifies as its lending office
(and address for notices) the offices set forth beneath its name on
the signature pages hereof.
4. As consideration for the assignment and sale
contemplated in Section 1 hereof, the Assignee shall pay to the
Assignor on the Effective Date in Federal funds an amount equal to
$________________*. It is understood that commitment and/or facility
fees accrued to the Effective Date with respect to the interest
assigned hereby are for the account of the Assignor and such fees
accruing from and including the date hereof are for the account of the
Assignee. Each of the Assignor and the Assignee hereby agrees that if
it receives any amount under the Credit Agreement which is for the
account of the other party hereto, it shall receive the same for the
account of such other party to the extent of such other party's
interest therein and shall promptly pay the same to such other party.
5. The effective date for this Assignment and Acceptance
shall be _____________, 19___(the "Effective Date"). Following the
execution of this Assignment and Acceptance, it will be delivered to
the Agent for acceptance and recording by the Agent and, if required,
the Borrower.
6. Upon such acceptance and recording, as of the
Effective Date, (i) the Assignee shall be a party to the Credit
Agreement and, to the extent provided in this Assignment and
Acceptance, have the rights and obligations of a Bank thereunder and
(ii) the Assignor shall, to the extent provided in this Assignment and
Acceptance, relinquish its rights and be released from its obligations
under the Credit Agreement.
7. Upon such acceptance and recording, from and after
the Effective Date, the Agent shall make all payments under the Credit
Agreement in respect of the interest assigned hereby (including,
without limitation, all payments of principal, interest and commitment
fees with respect thereto) to the Assignee. The Assignor and Assignee
shall make all appropriate adjustments in payments under the Credit
Agreement for periods prior to the Effective Date directly between
themselves.
-----------
* Amount should combine principal together with accrued interest and breakage
compensation, if any, to be paid by the Assignee, net of any portion of any
upfront fee to be paid by the Assignor to the Assignee. It may be preferable
in an appropriate case to specify these amounts generically or by formula
rather than as a fixed sum.
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88
8. In accordance with Section 12.12 of the Credit
Agreement, the Assignor and the Assignee request and direct that the
Agent prepare and cause the Borrower to execute and deliver to
the Assignee the relevant Notes payable to the Assignee in the amount
of its Commitments and new Notes to the Assignor in the amount of its
Commitments after giving effect to this assignment.
9. This Assignment and Acceptance shall be governed by,
and construed in accordance with, the laws of the State of Illinois.
[Assignor Bank]
By
---------------------------------------
Name
----------------------------------
Title
----------------------------------
[Assignee Bank]
By
---------------------------------------
Name
----------------------------------
Title
----------------------------------
Lending office (and address for notices):
Accepted and consented this
____ day of ___________, 19__
VISION TWENTY-ONE, INC.
By
----------------------------------
Name
------------------------------
Title
-----------------------------
Accepted and consented to by the Agent this
_______ day of ___________, 19__
BANK OF MONTREAL, as Agent
By
----------------------------------
Name
------------------------------
Title
-----------------------------
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89
SCHEDULE I
PRINCIPAL AMOUNT TYPE OF LOAN INTEREST RATE MATURITY DATE
90
SCHEDULE 6.2
SUBSIDIARIES
NAME JURISDICTION OF INCORPORATION PERCENTAGE OWNERSHIP
Vision 21 Physician Practice Management Company Florida 100%
Vision Twenty-One Eye Laser Centers, Inc. Florida 100%
Vision 21 of Southern Arizona, Inc. Florida 100%
Vision 21 of Sierra Vista, Inc. Florida 100%
Vision 21 Management Services, Inc. Florida 100%
Vision 21 Managed Eye Care of Tampa Bay, Inc. Florida 100%
Vision Twenty-One Managed Eye Care IPA, Inc. New York 100%
BBG-COA, Inc. Delaware 100%
MEC Health Care, Inc. Maryland 100%
LSI Acquisition, Inc. New Jersey 100%
BVC Administrators, Inc. New Jersey 100%(1)
Block Vision, Inc. New Jersey 100%(1)
BHVC Independent Practice Association, Inc. New York 100%(2)
The Block Group of New York, Inc. New York 100%(2)
BBG Independent Practice Association, Inc. New York 100%(2)
__________________________________
1 Subsidiaries of BBG-COA, Inc.
2 Subsidiaries of Block Vision, Inc.
91
VCA Independent Practice Association, Inc. New York 100%(2)
UVC Independent Practice Association, Inc. New York 100%(2)
CHVC Independent Practice Association, Inc. New York 100%(2)
Block Vision of Texas, Inc. Texas 100%(2)
WVC Independent Practice Association, Inc. New York 100%(2)
FVC Independent Practice Association, Inc. New York 100%(2)
MVC Independent Practice Association, Inc. New York 100%(2)
_______________________
2 Subsidiaries of Block Vision, Inc.
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92
SCHEDULE 6.7
ADDITIONAL DISCLOSURES
Since September 30, 1997, the Borrower has incurred contingent
liabilities in connection with certain acquisitions described in the
Borrower's prospectus dated November 20, 1997 and as set forth below:
1. LSI Acquisition, Inc. and MEC Health Care, Inc. acquisition:
Effective December 1, 1997, the Borrower acquired all of the issued and
outstanding capital stock and assumed all of the outstanding liabilities of
LSI Acquisition, Inc. and MEC Health Care, Inc. from LaserSight Incorporated.
2. Florida Eye Care Associates, Inc. acquisition:
The Borrower and Vision 21 Management Services, Inc. are in the process of
acquiring Florida Eye Care Associates, Inc. The consideration to be paid
includes $68,126 in cash and contingent consideration equal to $68,126 in
cash and $136,251 in shares of the Borrower's common stock.
3. ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇, P.A. acquisition:
The Borrower is in the process of acquiring the capital stock of ▇▇. ▇▇▇▇▇
▇. ▇▇▇▇▇, P.A. for consideration of $50,000 in cash and 150,000 shares of its
common stock.
4. Desert Eye Associates, Ltd. acquisition:
The Borrower is in the process of acquiring the assets of Desert Eye
Associates, Ltd. for $849,626 in cash and 90,100 shares of its common stock.
Additional consideration of up to $488,231 in cash and stock may be paid if
the seller reaches certain earnings benchmarks.
5. J.R. ▇▇▇▇, ▇.▇. acquisition:
The Borrower is in the process of acquiring the assets of J.R. ▇▇▇▇, ▇.▇.
for an aggregate consideration of $2,400,000 half of which will be paid in
cash and half of which will be paid in shares of its common stock.
Contingent consideration of up to $600,000 in cash and stock may be paid
if certain financial benchmarks are met.
93
SCHEDULE 6.12
TAXES
The Internal Revenue Service has notified Block Vision, Inc. that it
intends to conduct a routine examination of that company's consolidated tax
return filed on Form 1120 for the year ended April 30, 1996.
94
SCHEDULE 8.13
EXISTING INDEBTEDNESS
Capital lease obligation:
Property equipment lease dated June 27,
1996 with Hillside Finance International, LLC $650,000
Note payable to selling shareholder with
Interest at the rate of 8% due April 1998 245,440
Other long-term debt 387,797
-----------
$1,283,237
===========