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EXHIBIT 10.27
AMENDED AND RESTATED
CREDIT AGREEMENT
August 1, 2000
AMERICA SERVICE GROUP INC.,
Borrower
BANK OF AMERICA, N.A.,
Administrative Agent
and Issuing Bank
BANC OF AMERICA SECURITIES LLC
Lead Arranger
and Book Manager
AMSOUTH BANK
▇▇▇▇▇▇ TRUST AND SAVINGS BANK
Co-Agents
$ 65,000,000
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AMENDED AND RESTATED
CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT (this "Agreement"), dated as
of August 1, 2000, is made and entered into on the terms and conditions
hereinafter set forth, by and among AMERICA SERVICE GROUP INC., a Delaware
corporation (the "Borrower"), all subsidiaries of the Borrower now or hereafter
becoming parties to this Agreement (collectively, the "Guarantors" and,
individually, a "Guarantor"), those several lenders who are or become parties to
this Agreement (collectively, the "Lenders" and, individually, a "Lender"), BANK
OF AMERICA, N.A., a national banking association ("Bank of America"), as
administrative agent for the Lenders and the Issuing Bank (in such capacity, the
"Administrative Agent") and as Issuing Bank, and AMSOUTH BANK, an Alabama
banking corporation, and ▇▇▇▇▇▇ TRUST AND SAVINGS BANK, an Illinois banking
corporation, as co-agents (in such capacity, collectively, the "Co-Agents" and,
individually, a "Co-Agent").
THE PARTIES HERETO AGREE AS FOLLOWS:
ARTICLE 1
DEFINITIONS, ACCOUNTING TERMS
AND PRINCIPLES OF CONSTRUCTION
1.1. Defined Terms. In addition to terms defined elsewhere herein,
the following terms, as used in this Agreement, shall have the respective
meanings set forth below (terms defined in the singular to have the same meaning
when used in the plural, and vice versa, unless otherwise expressly indicated):
"Acquisition Consideration" shall mean, with respect to any Asset
Acquisition, the aggregate consideration paid or to be paid in connection with
such Asset Acquisition, including all Indebtedness incurred or assumed and an
amount corresponding to the Borrower's good-faith projected liability in respect
of any "earnout" or similar payments payable during or with respect to the
twelve (12) month period following the date of such Asset Acquisition, but
excluding any equity securities of the acquiring Person issued in compliance
with applicable provisions of this Agreement.
"Adjusted Rent Expense" shall mean, for the Borrower and its
Subsidiaries on a consolidated basis for any period, Rent Expense less the
product obtained by multiplying $3,000,000 by a fraction, the numerator of which
is the number of months in such period and the
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denominator of which is twelve (12); provided, however, that in no event shall
Adjusted Rent Expense be less than zero.
"Administrative Agent" shall mean Bank of America or such successor
Administrative Agent as may be appointed by the Lenders pursuant to Section
12.10.
"Affiliate" shall mean, as to any Person, any other Person directly or
indirectly controlling (including all directors, officers and employees of such
Person), directly or indirectly controlled by or under direct or indirect common
control with such Person.
"Applicable Bankruptcy Law" shall mean, with respect to any Guarantor,
Title 11 of the United States Code, and any other laws governing bankruptcy,
suspension of payments, reorganization, arrangement, adjustment of debts, relief
of debtors, dissolution or insolvency and any other similar laws applicable to
such Guarantor.
"Applicable Base Rate Margin" shall mean the margin to be added to the
Base Rate for purposes of determining the interest rate(s) applicable to Base
Rate Loans from time to time, which shall be determined as provided in Section
2.13.
"Applicable Commitment Fee Percentage" shall mean the percentage to be
used to calculate Commitment Fees from time to time, which shall be determined
as provided in Section 2.13.
"Applicable Letter of Credit Fee Percentage" shall mean the annualized
percentage to be used to calculate Letter of Credit Fees from time to time,
which shall be determined as provided in Section 2.13.
"Applicable LIBOR Margin" shall mean the margin to be added to LIBOR
for purposes of determining the interest rate(s) applicable to LIBOR Loans from
time to time, which shall be determined as provided in Section 2.13.
"Asset Acquisition" shall mean (a) any investment by the Borrower or
any of its Subsidiaries in any other Person pursuant to which such Person shall
become a Subsidiary of the Borrower or any of its Subsidiaries or shall be
merged with the Borrower or any of its Subsidiaries or (b) any acquisition by
the Borrower or any of its Subsidiaries of the assets of any Person that
constitute substantially all of an operating unit or business of such Person.
"Asset Disposition" shall mean any sale or other disposition (or a
series of related sales or dispositions), including loss, damage, destruction or
taking by or in lieu of the exercise of the power of eminent domain, of any
property or asset of the Borrower or any Guarantor (including any equity
securities owned by such Person) to or in favor of any Person other than the
Borrower or a Guarantor.
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"Assignment and Acceptance" shall mean an assignment and acceptance,
substantially in the form of Exhibit 13.2, between a transferor Lender and a
proposed transferee, regarding the sale, assignment, transfer or other
disposition (other than the sale of a participation) of all or any amount of the
Commitments, Revolving Loans and participations in the Letters of Credit of such
Lender.
"Assignment and Security Agreement" shall mean the Amended and Restated
Assignment and Security Agreement, substantially in the form of Exhibit 4.1C, by
and among the Borrower, the Guarantors and the Administrative Agent.
"Base LIBOR" shall mean the rate per annum for offered Dollar deposits
in the interbank Eurodollar market appearing on page 3750 of the TELERATE rate
reporting system at about 12:00 noon, Eastern time, on the Interest Rate
Determination Date immediately prior to the beginning of the Interest Period for
the corresponding LIBOR Loan, for the number of months comprised therein and in
an amount equal to the amount of such LIBOR Loan to be outstanding during such
Interest Period. Without limiting the provisions of Section 2.14.3, in the event
that prior to the Maturity Date TELERATE quotes for Base LIBOR are discontinued
or become unascertainable, the Administrative Agent may designate a comparable
resource for use in determining Base LIBOR for purposes hereof.
"Base Rate" shall mean, for any period, the greater of (a) the
fluctuating rate of interest per annum from time to time established by Bank of
America as its "prime rate", regardless of whether published or publicly
announced, or (b) a fluctuating rate of interest per annum equal to one-half of
one percentage point (0.5%) in excess of the Federal Funds Rate in effect from
time to time. Each change in the Base Rate shall be effective as of the opening
of business on the day such change occurs. The parties hereto acknowledge that
the rate established by Bank of America as its "prime rate" is an index or base
rate and is not necessarily the lowest rate charged to its customers or other
banks. In the event that prior to the Maturity Date Bank of America discontinues
or abandons the practice of establishing a prime rate, or should the same become
unascertainable, the Administrative Agent shall designate a comparable reference
rate for use in determining the Base Rate for purposes hereof.
"Base Rate Loans" shall mean Revolving Loans bearing interest at rates
determined by reference to the Base Rate.
"Borrowing" shall mean (a) a borrowing consisting of Revolving Loans
made to the Borrower on the same day by the Lenders ratably according to their
respective Commitments pursuant to the provisions of Section 2.2.1, and (b) a
borrowing consisting of a Swing Line Loan made to the Borrower by the Swing Line
Lender pursuant to the provisions of Section 2.2.6.
"Business Day" shall mean any day other than a Saturday, a Sunday or a
day on which a banking institution in either the State of North Carolina or the
State of Tennessee is authorized or required by law or executive order to close.
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"Capital Expenditures" shall mean, as to any Person for any period, the
aggregate capital expenditures recorded by such Person and its Subsidiaries on a
consolidated basis in conformity with GAAP, including charges in respect of
Capitalized Lease Obligations exclusive of imputed interest on such Capitalized
Lease Obligations.
"Capitalized Lease" shall mean, as to any Person, any lease of property
by such Person as lessee that would be capitalized on a balance sheet of such
Person prepared in conformity with GAAP.
"Capitalized Lease Obligations" shall mean, as to any Person, the
capitalized amount of the obligations of such Person and its Subsidiaries under
all Capitalized Leases.
"Cash Equivalents" shall mean, at any time,
(a) Government Obligations having a maturity not
exceeding one hundred eighty (180) days;
(b) commercial paper rated at least A-1 by S&P or P-1 by
Moody's, having a maturity not exceeding one hundred eighty (180) days;
(c) certificates of deposit or time deposits of (i) the
Lenders or (ii) other commercial banks having capital and undivided
surplus of at least $500 million and issuing commercial paper rated as
described in the preceding clause (b) and organized and existing under,
or chartered or otherwise qualified to do business under, the laws of
the United States of America or any State thereof or the District of
Columbia, having a maturity not exceeding ninety (90) days;
(d) repurchase agreements or investment contracts having
a maturity not exceeding ninety (90) days with a financial institution
insured by the Federal Deposit Insurance Corporation, or any broker or
dealer (as defined in the Securities Exchange Act of 1934) that is a
dealer in government bonds and that is recognized by trades with and
reports to, a Federal Reserve Bank as a primary dealer in government
securities; provided that in any case (i) collateral is pledged for the
repurchase agreement or investment contract, which collateral consists
of (A) Government Obligations or evidences of ownership of
proportionate interests in future interest and principal payments on
Government Obligations held by a bank or trust company as custodian,
under which the owner of the investment is the real party in interest
and has the right to proceed directly and individually against the
obligor on such obligations, and which underlying obligations are held
in a segregated account and not available to satisfy any claim of the
custodian or any person claiming through the custodian or to whom the
custodian may be obligated or (B) evidences of indebtedness issued by
any of the following: Bank of Cooperatives, Export-Import Bank of the
United States, Farmers Home Administration, Federal Financing Bank,
Federal Home Loan Bank System, Federal Home Loan Mortgage Corporation
(including participation certificates), Federal Housing
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Administration, Federal Farm Credit Banks, Federal National Mortgage
Association, Government National Mortgage Association, Inter-American
Development Bank, International Bank for Reconstruction and
Development, Small Business Administration or any other agency or
instrumentality of the United States of America created by an act of
Congress that is substantially similar to the foregoing in its legal
relationship to the United States of America, (ii) the current market
value of the collateral securing the repurchase agreement or investment
contract is at least equal to the amount of the repurchase agreement or
investment contract and (iii) the current market value of the
collateral is determined not less frequently than monthly;
(e) investments in money market funds substantially all
of whose assets consist of securities of the types described in the
foregoing clauses (a) through (d);
(f) investments in obligations the return with respect to
which is excludable from gross income under Section 103 of the Code,
having a maturity of not more than six (6) months or providing the
holder the right to put such obligations for purchase at par upon not
more than twenty-eight (28) days' notice, and which are rated at least
A-1 by S&P or P-1 by Moody's;
(g) investments in tax free money market funds all of
whose assets consist of securities of the types described in the
foregoing clause (f); and
(h) investments, redeemable upon not more than seven (7)
days' notice, in money market preferred municipal bond funds that are
rated at least AAA by S&P or Aaa by Moody's.
"Certificate of Designation" shall have the meaning given such term in
the Securities Purchase Agreement.
"Code" shall mean the Internal Revenue Code of 1986.
"Collateral" shall mean all property and interests in property,
presently owned or hereafter acquired or presently existing or hereafter created
by the Borrower or the Guarantors, including any and all proceeds thereof, in
which a security interest has been granted in favor of the Administrative Agent
for the ratable benefit of the Lenders, whether under this Agreement, the
Security Documents or any other Loan Document.
"Collateral Account" shall mean the Collateral Account described in
Section 11.3.1.
"Commission" shall mean the Securities and Exchange Commission or any
successor entity.
"Commitment Fees" shall have the meaning given such term in Section
2.11.2.
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"Commitment Period" shall mean that period commencing on the date
hereof and continuing to, but not including, the Commitment Period Expiration
Date.
"Commitment Period Expiration Date" shall mean the Maturity Date.
"Commitments" shall mean the Revolving Credit Commitments and the
Letter of Credit Commitments, which collectively are in the aggregate amount set
forth in Section 2.1 and in the case of each Lender are in the initial amount
set forth with such Lender's signature on this Agreement or the Assignment and
Acceptance pursuant to which such Lender became a party hereto.
"Commonly Controlled Entity" shall mean a Person that is under common
control with the Borrower within the meaning of subsection 414(b), (c), (m), (n)
or (o) of the Code.
"Consolidated Funded Indebtedness" shall mean, for the Borrower and its
Subsidiaries on a consolidated basis, all Indebtedness that constitutes (a)
indebtedness for borrowed money or for notes, debentures or other debt
securities, (b) notes payable and drafts accepted representing extensions of
credit regardless of whether the same represent obligations for borrowed money,
(c) reimbursement obligations in respect of letters of credit issued for the
account of Borrower or a Subsidiary thereof (including any such obligations in
respect of any drafts drawn thereunder), (d) liabilities for all or any part of
the deferred purchase price of property or services, (e) liabilities secured by
any Lien on any property or asset owned or held by the Borrower or any of its
Subsidiaries regardless of whether the Indebtedness secured thereby shall have
been assumed by or is a primary obligation of the Borrower or such Subsidiary,
(f) Capitalized Lease Obligations, and (g) without duplication, all Contingent
Obligations the primary obligation of which is Indebtedness of the type
described in clauses (a) through (f) above; provided, however, that Consolidated
Funded Indebtedness shall not include any unsecured current liabilities incurred
in the ordinary course of business and not represented by any note, bond,
debenture or other instrument.
"Consolidated Net Income" shall mean, for the Borrower and its
Subsidiaries on a consolidated basis for any period, the net income (or loss)
after taxes of the Borrower and its Subsidiaries on a consolidated basis for
such period taken as a single accounting period, determined in conformity with
GAAP, subject to customary exclusions with respect to extraordinary and
nonrecurring items; provided, however, that net income attributable to Permitted
Non-Guarantor Entities in any Fiscal Quarter shall be excluded to the extent
that it exceeds ten percent (10%) of Consolidated Net Income for such Fiscal
Quarter.
"Contingent Obligations" shall mean, as to any Person, any contingent
obligation calculated in conformity with GAAP, and in any event shall include
(without duplication) all indebtedness, obligations or other liabilities of such
Person guaranteeing or in effect guaranteeing the payment or performance of any
indebtedness, obligation or other liability, regardless of whether contingent
(collectively, the "primary obligations"), of any other Person (the "primary
obligor") in any manner, whether directly or indirectly, including any
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indebtedness, obligation or other liability of such Person, (a) to purchase any
such primary obligation or any property constituting direct or indirect security
therefor, (b) to advance or supply funds (i) for the purchase or payment of any
such primary obligation or (ii) to maintain working capital or equity capital of
the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (c) to purchase property, securities or services primarily for
the purpose of assuring the owner of any such primary obligation of the ability
of the primary obligor to make payment of such primary obligation, or (d)
otherwise to assure or hold harmless the owner of such primary obligation
against loss with respect thereto.
"Continuing Directors" shall mean, as of any date of determination:
(a) individuals who were directors of the Borrower on the
day that is two (2) years prior to such date,
(b) any individual appointed or elected by a Person or
group of Persons who on the date of this Agreement has (or pursuant to
the terms of securities of the Borrower held by such Person or group on
the date of this Agreement will have) a right, without the joinder or
approval of any other Person, to appoint or elect such individual to
the Borrower's board of directors or to cause such individual to be so
appointed or elected, and
(c) individuals whose election as directors of the
Borrower or whose nomination for such election by the Borrower's
shareholders was approved by a vote of at least two-thirds (2/3) of the
directors of the Borrower then in office who either are directors
described in the preceding clauses (a) or (b) or whose election or
nomination for election was previously so approved.
"Contractual Obligations" shall mean, as to any Person, any and all
indebtedness, obligations or other liabilities of such Person, now existing or
hereafter arising, whether due or not due, absolute or contingent, liquidated or
unliquidated, direct or indirect, express or implied, individually or jointly
with others, pursuant to the provisions of any document, instrument or agreement
to which such Person is a party or by which such Person or any of its property
is or may be bound or affected or pursuant to the provisions of any security
issued by such Person.
"Convertible Preferred Stock" shall mean the Series A Convertible
Preferred Stock, $0.01 par value, issued by the Borrower pursuant to the
Securities Purchase Agreement.
"Credit Fees" shall mean the credit fees payable as provided in Section
2.11.
"Default" shall mean any of the events specified in Section 11.1,
regardless of whether any requirement for the giving of notice (and, if
applicable, an opportunity to cure), the lapse of time or both has been
satisfied.
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"Default Rate" shall mean the rate(s) per annum otherwise applicable to
Loans from time to time plus two percentage points (2.00%); provided, however,
that in no event shall any Default Rate exceed the Highest Lawful Rate.
"Dollars" and "$" shall mean lawful money of the United States of
America.
"EBITDA" shall mean, for the Borrower and its Subsidiaries on a
consolidated basis for any period, after giving Pro Forma Effect to any
transactions or occurrences to which such term is applicable as of the date of
determination, the sum of Consolidated Net Income, plus Interest Expense, plus
any provision for taxes based on income or profits that was deducted in
computing Consolidated Net Income, plus depreciation, amortization of intangible
assets and other non-cash charges.
"Environmental Laws" shall mean all federal, state, regional, county or
local laws, statutes, rules, regulations or ordinances, now or hereafter in
effect, relating to the generation, recycling, use, reuse, sale, storage,
handling, transport, treatment or disposal of Hazardous Materials, including the
Comprehensive Environmental Response Compensation Liability Act of 1980, as
amended by the Superfund Amendments and Reauthorization Act of 1986, 42
U.S.C.ss.9601 et seq., the Resource Conservation and Recovery Act of 1976, as
amended by the Solid and Hazardous Waste Amendments of 1984, 42 U.S.C.ss.6901 et
seq., the Toxic Substances Control Act, 15 U.S.C.ss.2601 et seq., the Hazardous
Materials Transportation Act, 49 U.S.C.ss.1801, et seq., the Clean Air Act, 42
U.S.C.ss.7401 et seq., the Clean Water Act of 1977, 33 U.S.C.ss.1251 et seq.,
and any rules, regulations and guidance documents promulgated or published
thereunder, and any state, regional, county or local statute, law, rule,
regulation or ordinance now or hereafter in effect that relates to public
health, safety or the discharge, emission or disposal of Hazardous Materials in
or to air, water, land or groundwater, to the withdrawal or use of groundwater,
to the use, handling or disposal of asbestos, polychlorinated biphenyls,
petroleum, petroleum derivatives or by-products, other hydrocarbons or urea
formaldehyde, to the treatment, storage, disposal or management of Hazardous
Materials, to exposure to Hazardous Materials or to the transportation, storage,
disposal, management or release of gaseous or liquid substances, and any
regulation, order, injunction, judgment, declaration, notice or demand issued
thereunder.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974.
"Event of Default" shall mean any of the events specified in Section
11.1, provided that any requirement for the giving of notice (and, if
applicable, an opportunity to cure), the lapse of time or both has been
satisfied.
"Existing Liens" shall mean those certain Liens in existence on the
date hereof that are described on Schedule 9.2.
"Facilities" shall mean the Revolving Credit Facility, the Swing Line
Facility and the Letter of Credit Facility.
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"Federal Funds Rate" shall mean, for any period, a fluctuating interest
rate per annum equal for each day during such period to the weighted average of
the rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published for each day (or,
if such day is not a Business Day, for the immediately preceding Business Day)
by the Federal Reserve Bank of New York.
"Financing Statement" shall mean any Uniform Commercial Code financing
statement, on Form UCC-1 or otherwise, executed pursuant to the provisions of
this Agreement or any other Loan Document.
"Fiscal Quarter" shall mean each of the accounting periods of
approximately three (3) months ending on March 31, June 30, September 30 and
December 31, respectively, of each year.
"Fiscal Year" shall mean the twelve (12) month period ending on
December 31 of each year.
"Fixed Charge Coverage Ratio" shall mean, for the Borrower and its
Subsidiaries on a consolidated basis, calculated as of any date of determination
for the six (6) month period ending on the last day of the Fiscal Quarter most
recently ended, after giving Pro Forma Effect to any transactions or occurrences
to which such term is applicable as of the last day of such Fiscal Quarter, the
ratio of (a) EBITDA, plus Adjusted Rent Expense, less Restricted Payments (to
the extent not previously deducted in computing Consolidated Net Income), less
taxes paid in cash, to (b) Interest Expense, plus Adjusted Rent Expense, plus an
amount equal to ten percent (10%) of the aggregate principal balance of the
Loans and Letter of Credit Liabilities outstanding on the last day of the Fiscal
Quarter most recently ended.
"Funding Date" shall mean each of the respective dates on which the
funding of a Borrowing made under this Agreement occurs.
"GAAP" shall mean generally accepted accounting principles in the
United States of America in effect from time to time.
"Government Obligations" shall mean direct obligations of the United
States of America or obligations for the full and prompt payment of which the
full faith and credit of the United States of America are pledged.
"Governmental Authority" shall mean any nation, province, state or
other political subdivision thereof and any government or any natural person or
entity exercising executive, legislative, regulatory or administrative functions
of or pertaining to government.
"Guaranteed Obligations" shall mean all the obligations of the Borrower
guaranteed by the Guarantors pursuant to Article 5.
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"Guarantor" shall mean each Subsidiary of the Borrower that has become
a party to this Agreement as a Guarantor by executing this Agreement or a
Supplement to Amended and Restated Credit Agreement in the form of Exhibit 1.1,
has become a party to the Security Agreement by executing the Security Agreement
or a Supplement to Amended and Restated Security Agreement in the form of
Exhibit A thereto, has become a party to the Pledge Agreement by executing the
Pledge Agreement or a Supplement to Amended and Restated Pledge Agreement in the
form of Exhibit A thereto, has become a party to the Assignment and Security
Agreement by executing the Assignment and Security Agreement or a Supplement to
Amended and Restated Assignment and Security Agreement in the form of Exhibit A
thereto and has delivered to the Administrative Agent, for the ratable benefit
of the Lenders, (1) all certificates and other instruments or documents
evidencing capital stock or other ownership interests of such Subsidiary in any
other Subsidiaries of the Borrower, accompanied by stock powers endorsed in
blank or the equivalent and (2) all promissory notes and other instruments
evidencing intercompany Indebtedness owed to such Subsidiary by any other
Subsidiary of the Borrower, endorsed to the order of the Administrative Agent.
"Guaranty" shall mean the guaranty of the Obligations of the Borrower
set forth in Article 5.
"Hazardous Material" shall mean any material, substance, pollutant or
waste that is defined or designated as a hazardous material, hazardous
substance, hazardous waste, pollutant, contaminant or toxic substance under any
Environmental Law or otherwise is regulated under any Environmental Law,
including asbestos, polychlorinated biphenyls, petroleum, petroleum derivatives
or by-products, other hydrocarbons, urea formaldehyde and medical and infectious
wastes.
"Highest Lawful Rate" shall mean, with respect to each Lender, the
maximum nonusurious interest rate, if any, that at any time or from time to time
may be contracted for, taken, reserved, charged or received on debts outstanding
hereunder or under the Notes, as the case may be, under the laws applicable to
such Lender that are presently in effect or, to the extent allowed by law, under
such applicable laws that may hereafter be in effect and that allow a higher
maximum nonusurious interest rate than applicable laws now allow.
"Indebtedness" shall mean, as to any Person, all items that in
conformity with GAAP would be shown on the balance sheet of such Person as a
liability and in any event shall include (without duplication) (a) indebtedness
for borrowed money or for notes, debentures or other debt securities, (b) notes
payable and drafts accepted representing extensions of credit regardless of
whether representing obligations for borrowed money, (c) reimbursement
obligations in respect of letters of credit issued for the account of such
Person (including any such obligations in respect of any drafts drawn
thereunder), (d) liabilities for all or any part of the deferred purchase price
of property or services, (e) liabilities secured by any Lien on any property or
asset owned or held by such Person regardless of whether the indebtedness
secured thereby shall have been
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assumed by or is a primary liability of such Person, (f) Capitalized Lease
Obligations, and (g) Contingent Obligations.
"Insurance Subsidiary" shall mean any Subsidiary of the Borrower
hereafter organized for the purpose of engaging in the insurance business.
"Interest Expense" shall mean, as to any Person for any period, the
aggregate interest expense and amortization of deferred loan costs of such
Person and its Subsidiaries on a consolidated basis for such period (calculated
without regard to any limitations on the payment thereof), imputed interest on
Capitalized Lease Obligations, commissions, discounts and other fees and charges
owed with respect to letters of credit and unused commitments and net costs
under interest rate protection agreements, all as determined in conformity with
GAAP.
"Interest Payment Date" shall mean, (a) with respect to any Base Rate
Loan or Swing Line Loan, January 1, April 1, July 1 and October 1 of each year,
commencing on the first such date after the applicable Funding Date, and (b)
with respect to any LIBOR Loan, the last day of the Interest Period applicable
to such Loan; provided, however, that with respect to any Interest Period of six
(6) months or more, "Interest Payment Date" also shall include the day that is
three (3) months after the day on which that Interest Period commenced.
"Interest Period" shall mean any interest period applicable to a LIBOR
Loan as determined pursuant to Section 2.14.1.
"Interest Rate Contracts" shall mean any interest rate swap agreements,
interest rate cap agreements, interest rate collar agreements, interest rate
insurance and other agreements or arrangements designed to provide protection
against fluctuations in interest rates, in each case between the Borrower and
any Lender, and in an aggregate notional amount at any time not to exceed an
amount equal to Consolidated Funded Indebtedness at such time.
"Interest Rate Determination Date" shall mean each date for calculating
LIBOR for purposes of determining the interest rate in respect of an Interest
Period, which in each case shall be the second (2d) Business Day prior to the
first (1st) day of the corresponding Interest Period.
"Investment" shall mean the making of any loan, advance, extension of
credit or capital contribution to, or the acquisition of any stock, bonds,
notes, debentures or other obligations or securities of, or the acquisition of
any other interest in or the making of any other investment in, any Person.
"Issuing Bank" shall mean Bank of America and any other financial
institution that, subject to approval by the Administrative Agent and the
Borrower, agrees to become a party to this Agreement and to issue Letters of
Credit pursuant to Section 2.3.
"Lending Office" shall mean with respect to any Lender or the
Administrative Agent, the office of each such Lender at the address specified on
the signature pages hereto or in the
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Assignment and Acceptance pursuant to which it became a Lender, or such other
office as any such Lender from time to time may specify to the Borrower and the
Administrative Agent.
"Letter of Credit Commitments" shall mean, at any time, (a) the
commitment of the Issuing Bank to issue Letters of Credit pursuant to the
provisions of Section 2.3.1, and (b) the aggregate commitments of all the
Lenders to purchase participations in the Letter of Credit Liabilities pursuant
to the provision of Section 2.4; and the "Letter of Credit Commitment" of any
Lender at any time shall mean an amount equal to such Lender's Percentage
multiplied by the then effective aggregate Letter of Credit Commitments under
clause (b) above. The Letter of Credit Commitments are in the aggregate amount
set forth in Section 2.1.
"Letter of Credit Facility" shall mean the letter of credit facility
provided by the Lenders pursuant to the Letter of Credit Commitments as more
particularly set forth in Section 2.3.
"Letter of Credit Fees" shall have the meaning given such term in
Section 2.11.3.
"Letter of Credit Liabilities" shall mean all liabilities of the
Borrower to the Issuing Bank in respect of Letters of Credit, regardless of
whether any such liability is contingent, and shall consist of the sum, without
duplication, of (a) the amount available to be drawn or that may become
available to be drawn under outstanding Letters of Credit (including all amounts
committed to be paid by the Issuing Bank thereunder), and (b) all amounts that
have been paid or made available by the Issuing Bank thereunder if and to the
extent the Issuing Bank has not received reimbursement from the Borrower
pursuant to the terms hereof.
"Letter of Credit Request" shall mean a request substantially in the
form of Exhibit 2.3.2 with respect to the proposed issuance of a Letter of
Credit hereunder.
"Letter of Credit Supportable Obligations" shall mean (a) obligations
of the Borrower or any of its Subsidiaries incurred in the ordinary course of
business with respect to workers' compensation, surety bonds and other similar
statutory obligations, (b) obligations of the Borrower or any of its
Subsidiaries in respect of Service Contracts or performance bonds issued in
connection therewith, and (c) such other obligations of the Borrower or any of
its Subsidiaries as are reasonably acceptable to the Issuing Bank and the
Administrative Agent and otherwise permitted to exist pursuant to the terms of
this Agreement.
"Letters of Credit" shall mean the letters of credit issued by the
Issuing Bank pursuant to the provisions of Section 2.3.1.
"Leverage Ratio" shall mean, for the Borrower and its Subsidiaries on a
consolidated basis, calculated as of any date of determination for the six (6)
month period ending on the last day of the Fiscal Quarter most recently ended,
after giving Pro Forma Effect to any transactions or occurrences to which such
term is applicable as of the last day of such Fiscal Quarter, the ratio of (a)
Consolidated Funded Indebtedness as of the last day of such Fiscal Quarter to
(b) the product obtained by multiplying EBITDA for such period by two (2).
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"LIBOR" shall mean the rate per annum (rounded upwards, if necessary,
to the nearest whole one-eighth of 1%) equal to the product of Base LIBOR times
Statutory Reserves.
"LIBOR Loans" shall mean Revolving Loans bearing interest at rates
determined by reference to LIBOR.
"Lien" shall mean, as to any asset, (a) any lien, charge, claim,
mortgage, security interest, pledge, hypothecation or other encumbrance of any
kind with respect to such asset, (b) any interest of a vendor or lessor under
any conditional sale agreement, Capitalized Lease or other title retention
agreement relating to such asset, (c) any reservation, exception, encroachment,
easement, right-of-way, covenant, condition, restriction, lease or other title
exception affecting such asset, or (d) any assignment, deposit, preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including any conditional sale or other title retention
agreement, any financing lease having substantially the same economic effect as
any of the foregoing, and the filing of any financing statement under the
Uniform Commercial Code or comparable law of any jurisdiction).
"Loan Documents" shall mean this Agreement, the Notes, the Letters of
Credit, the Security Documents, the Interest Rate Contracts and all other
documents, instruments and agreements now or hereafter executed or delivered
pursuant hereto or in connection herewith.
"Loans" shall mean Revolving Loans and Swing Line Loans.
"Material Adverse Effect" and "Material Adverse Change" shall mean a
material adverse effect on, or a material adverse change in, (a) the properties,
business, operations or financial condition of the Borrower and its
Subsidiaries, taken as a whole, or (b) the ability of the Borrower, any
Guarantor or any of their respective Subsidiaries to perform any of their
respective obligations under this Agreement, the Notes or the other Loan
Documents to which it is a party.
"Material Contract" shall mean each contract (including each Service
Contract) to which the Borrower or any of its Subsidiaries is a party or a
guarantor (or by which it is bound) that requires payments (either to or for the
benefit of, or by or on behalf of, the Borrower or any of its Subsidiaries) in
excess of $3,000,000 in any twelve-month period (a) the cancellation,
non-performance or non-renewal of which by any party thereto would have a
Material Adverse Effect, or (b) pursuant to which the Borrower or any of its
Subsidiaries may incur Indebtedness for borrowed money or Capitalized Lease
Obligations.
"Maturity Date" shall mean the third anniversary of the date of this
Agreement, or such earlier date to which the maturity of the Obligations may be
accelerated pursuant to the terms of this Agreement.
"Maximum Guaranty Liability" shall mean the maximum liability hereunder
of the respective Guarantors permitted by Applicable Bankruptcy Law as provided
in Section 5.2.
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"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc. and its
successors.
"Multi-Employer Plan" shall mean any multiple employer plan, as defined
in Section 4001(a)(3) of ERISA, that is maintained by the Borrower, any
Guarantor, any of their respective Subsidiaries or a Commonly Controlled Entity.
"Net Proceeds" shall mean:
(a) with respect to any Asset Disposition, the aggregate
of all amounts paid to the Borrower or a Guarantor in cash, as and when
received, including (i) deferred payments pursuant to a promissory
note, an account receivable or otherwise (other than interest payable
in respect thereof), and (ii) with respect to Asset Disposition
resulting from the loss, destruction or taking of or damage to
property, the proceeds of insurance or condemnation claims and amounts
paid or payable in settlement thereof, net of ordinary, necessary and
reasonable sale expenses, fees and commissions incurred and taxes paid
or expected to be paid within the twelve (12) month period following
such loss, destruction, taking or damage, and net of any amounts
required to be paid in respect of any Indebtedness secured by a Lien on
such property or asset, and
(b) with respect to the offering or sale of any equity
securities (or any securities convertible into equity securities) or
the incurrence of any Indebtedness, the gross proceeds received in the
transaction, less ordinary, necessary and reasonable transaction
expenses.
"Net Worth" shall mean, for the Borrower and the Guarantors on a
consolidated basis, as of any date of determination, net worth (shareholders' or
owners' equity).
"Notes" shall mean the Revolving Notes and the Swing Line Note.
"Notice of Borrowing" shall mean a notice substantially in the form of
Exhibit 2.2.4 with respect to a proposed Borrowing of Revolving Loans.
"Notice of Conversion/Continuation" shall mean a notice substantially
in the form of Exhibit 2.7.2 with respect to a proposed conversion or
continuation, pursuant to Section 2.7, of (a) Revolving Loans bearing interest
at a rate determined by reference to one basis, to (b) Revolving Loans bearing
interest at a rate determined by reference to an alternative basis.
"Obligations" shall mean, as to any Person, all indebtedness,
obligations and other liabilities of such Person of any kind and description
owing to the Administrative Agent, the Issuing Bank or the Lenders pursuant to
the provisions of this Agreement, the Notes and the other Loan Documents,
howsoever evidenced or acquired, whether now existing or hereafter arising, due
or not due, absolute or contingent, liquidated or unliquidated, direct or
indirect, express or implied, whether owed individually or jointly with others.
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"Operating Lease" shall mean, as to any Person, any lease of property
(whether real, personal or mixed) by such Person as lessee that is not a
Capitalized Lease.
"Ordinary Capital Expenditures" shall mean, as to the Borrower and its
Subsidiaries on a consolidated basis for any period, Capital Expenditures
excluding (a) Capital Expenditures attributable solely to the making of
Permitted Acquisitions and (b) Reimbursable Capital Expenditures.
"Overline Agreement" shall mean the Overline Agreement dated April 25,
2000, by and among the Borrower, the Guarantors, the Lenders and Bank of
America, individually, as Administrative Agent and as Issuing Bank.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to subtitle A of Title IV of ERISA.
"Percentage" shall mean, as to each Lender, the percentage set forth
with such Lender's signature on this Agreement or the Assignment and Acceptance
pursuant to which such Lender became a party hereto.
"Permitted Acquisition" shall mean any Asset Acquisition by the
Borrower or any Guarantor with respect to which:
(a) the Borrower and the Guarantors shall have complied
with applicable provisions of Section 8.2.4,
(b) the Borrower or such Guarantor is the surviving
entity in the transaction,
(c) all assets acquired in the transaction are held or
acquired by the Borrower or such Guarantor,
(d) at the time of such Asset Acquisition and after
giving Pro Forma Effect thereto and to any other transactions or
occurrences to which such term is applicable as of the date of
determination, no Default shall have occurred or be continuing or would
result therefrom, and
(e) the aggregate Acquisition Consideration does not
exceed five percent (5%) of the consolidated assets of the Borrower and
its Subsidiaries, determined in conformity with GAAP, as of the end of
the immediately preceding Fiscal Year.
"Permitted Insurance Subsidiary Investments" shall mean Investments
held by an Insurance Subsidiary consisting of one or more of the following:
(a) Government Obligations;
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(b) commercial paper and other obligations rated at least
A-1 by S&P or P-1 by Moody's;
(c) certificates of deposit or time deposits of (i) the
Lenders or (ii) other commercial banks having capital and undivided
surplus of at least $500 million and issuing commercial paper rated as
described in the preceding clause (b) and organized and existing under,
or chartered or otherwise qualified to do business under, the laws of
the United States of America or any State thereof or the District of
Columbia;
(d) other obligations rated higher than A by both S&P and
Moody's;
(e) other obligations rated at least A by both S&P and
Moody's.
Notwithstanding the foregoing, the Investments described only in the preceding
clause (e), shall constitute Permitted Insurance Subsidiary Investments only to
the extent that the aggregate face amount of same do not at any time exceed
one-third (1/3) of the aggregate face amount of all Permitted Insurance
Subsidiary Investments at such time.
"Permitted Non-Guarantor Entity" shall mean a Person other than a
Subsidiary of the Borrower (a) in which the Borrower or any Subsidiary of the
Borrower maintains an Investment and (b) which is engaged solely in the business
of providing managed healthcare services to correctional facilities and related
businesses that enhance or support that primary business activity.
"Permitted Liens" shall mean Liens permitted pursuant to the provisions
of Section 9.2.
"Person" shall mean an individual, corporation, partnership, limited
partnership, limited liability company, limited liability limited partnership,
trust, business trust, association, joint stock company, joint venture, pool,
syndicate, sole proprietorship, unincorporated organization, Governmental
Authority or other form of entity not specifically listed herein.
"Plan" shall mean an employee pension benefit plan covered by Title IV
of ERISA that is maintained by the Borrower, any Guarantor, any of their
respective Subsidiaries or a Commonly Controlled Entity, and shall include any
Single Employer Plan or any Multi-Employer Plan.
"Pledge Agreement" shall mean the Amended and Restated Pledge and
Security Agreement, substantially in the form of Exhibit 4.1B, by and among the
Borrower, the Guarantors and the Administrative Agent.
"Pledged Notes" shall have the meaning given such term in the Pledge
Agreement.
"Pledged Stock" shall have the meaning given such term in the Pledge
Agreement.
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"Previous Credit Agreement" shall mean the Amended and Restated Credit
Agreement dated January 26, 1999, by and among the Borrower, certain
Subsidiaries of the Borrower, the Lenders, the Issuing Bank and NationsBank,
N.A. (subsequently merged with and into Bank of America), as Administrative
Agent, as heretofore amended, supplemented or otherwise modified.
"Pricing Tier Determination Date" shall mean the fifth (5th) Business
Day following each date on which the Borrower has delivered to the
Administrative Agent financial statements, financial reports, certificates and
other financial information complying with the requirements of Sections 8.1.1 or
8.1.2 and containing information sufficient to enable a calculation of the
Leverage Ratio for the Fiscal Quarter then most recently ended for the purpose
of determining the Applicable Base Rate Margin, the Applicable LIBOR Margin, the
Applicable Letter of Credit Fee Percentage and the Applicable Commitment Fee
Percentage pursuant to Section 2.13.
"Principal Obligor" shall mean, with respect to a specific indebtedness
or obligation, the Person creating, incurring, assuming or suffering to exist
such indebtedness or obligation without becoming liable for same as a surety or
guarantor.
"Pro Forma Effect" shall mean, in making any calculation hereunder to
which such term is applicable, including any calculation necessary to determine
whether the Borrower is in compliance with Sections 10.1.2 or 10.1.3 or whether
a Default would result from any Asset Acquisition, (a) any Asset Acquisition
made during the most recent twelve (12) month period (the "Reference Period")
ending on and including the date of determination (the "Calculation Date") shall
be assumed to have occurred on the first day of the Reference Period, (b)
Consolidated Funded Indebtedness, and the application of proceeds therefrom,
incurred or to be incurred in connection with any Asset Acquisition made or to
be made during the Reference Period shall be assumed to have arisen or occurred
on the first day of the Reference Period, (c) there shall be excluded any
Interest Expense in respect of Consolidated Funded Indebtedness outstanding
during the Reference Period that was or is to be refinanced with proceeds of
Indebtedness incurred or to be incurred in connection with any Asset Acquisition
made or to be made during the Reference Period, (d) Interest Expense in respect
of Consolidated Funded Indebtedness bearing a floating rate of interest and
assumed to have been incurred on the first day of the Reference Period shall be
calculated on the basis of the average rate in effect under this Agreement for
Base Rate Loans throughout the period such Consolidated Funded Indebtedness is
assumed to be outstanding, (e) Rent Expense shall include actual Rent Expense
incurred by any Person, operating unit or business acquired during the Reference
Period, plus Rent Expense projected for the twelve (12) month period following
the date of actual incurrence thereof in respect of any Operating Lease entered
into or to be entered into in connection with any Asset Acquisition made during
the Reference Period, which projected Rent Expense shall be deemed to have been
incurred on the first day of the Reference Period, and (f) to the extent not
already taken into account pursuant to the foregoing, (i) any Service Contract
that is entered into more than forty-five (45) days prior to the date of
determination and that reasonably may be expected to produce in excess of
$35,000,000 of annual revenue shall be deemed to have been in effect as of the
first day of the Reference Period, with corresponding adjustments in income and
expenses, and (ii) any Service Contract that expires or otherwise terminates
more than forty-five
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(45) days prior to the date of determination and that historically has produced
in excess of $35,000,000 of annual revenue shall be deemed to have been
terminated as of the first day of the Reference Period, with corresponding
adjustments in income and expenses.
"Projections" means the financial projections for the Borrower and its
Subsidiaries contained in the Confidential Offering Memorandum dated June, 2000,
relating to the Facilities, as such financial projections may have been modified
or supplemented in a writing delivered to the Administrative Agent, the Lenders
and the Issuing Bank that is expressly identified as a modification of or
supplement to such financial projections.
"Purchase Money Debt" shall mean (a) Indebtedness of the Borrower or
any of its Subsidiaries that, within thirty (30) days of the purchase of
equipment in which neither the Borrower nor any of its Subsidiaries at any time
prior to such purchase had any interest, is incurred to finance part or all of
(but not more than) the purchase price of such equipment, and that bears
interest at a rate per annum that is commercially reasonable at the time, and
(b) Indebtedness that constitutes a renewal, extension or refunding of, but not
an increase in the principal amount of, Purchase Money Debt that is such by
virtue of clause (a), is binding only upon the obligor or obligors under the
Purchase Money Debt being renewed, extended or refunded and bears interest at a
rate per annum that is commercially reasonable at the time.
"Qualifying Preferred Stock" shall mean preferred stock that is not,
whether through the passage of time or upon the occurrence of any event or
condition or otherwise, redeemable, payable or subject to being required to be
purchased or otherwise retired or extinguished, in whole or in part, (a) at a
fixed or determinable date, whether by operation of a sinking fund or otherwise,
(b) at the option of any Person other than the issuer, or (c) upon the
occurrence of a condition not solely within the control of the issuer, such as a
redemption required to be made out of future earnings.
"Reimbursable Capital Expenditure Limit" shall mean, as of any date of
determination, the lesser of (a) the sum of (i) the aggregate amount of
Reimbursable Capital Expenditures with respect to which it has been demonstrated
to the reasonable satisfaction of the Administrative Agent that the
corresponding Governmental Authority is obligated to reimburse the Borrower or a
Subsidiary of the Borrower, as applicable, for any unamortized or unreimbursed
portion of such Reimbursable Capital Expenditures upon any cancellation or
termination of the corresponding Service Contract, plus (ii) $1,000,000, and (b)
$6,000,000.
"Reimbursable Capital Expenditures" shall mean, for the Borrower and
its Subsidiaries on a consolidated basis, as of any date, Capital Expenditures
that are to be reimbursed by a Governmental Authority pursuant to a Service
Contract.
"Rent Expense" shall mean, as to any Person for any period, the
aggregate rent and lease expenses recorded by such Person and its Subsidiaries
on a consolidated basis in conformity with GAAP pursuant to any Operating Lease.
"Replacement Lender" shall have the meaning given such term in Section
2.16.
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"Reportable Event" shall mean any of the events set forth under Section
4043(b) of ERISA or the PBGC regulations thereunder.
"Requirement of Law" shall mean, as to any Person (a) the partnership
agreement, charter, certificate of incorporation, articles of incorporation,
bylaws, articles of organization, operating agreement or other organizational or
governing documents of such Person; (b) any federal, state or local law, treaty,
ordinance, rule or regulation; (c) any order, decree or determination of a
court, arbitrator or other Governmental Authority, in each case applicable to or
binding upon such Person or any of its property or to which such person or any
of its property is subject.
"Requisite Lenders" shall mean at any time Lenders having at least
sixty-seven percent (67%) of the Commitments.
"Responsible Officer" shall mean, as to any Person, either (a) its
president or chief executive officer, or (b) with respect to financial matters,
its president, chief executive officer, chief financial officer or any vice
president designated in writing by the chief executive officer to the
Administrative Agent.
"Restricted Payments" shall mean, as to any Person for any period:
(a) dividends, other distributions and other payments or
deliveries of property on account of the capital stock of or other
ownership interests in, or any warrants, options or other rights in
respect of any capital stock of or other ownership interests in, such
Person or its Subsidiaries, now or hereafter outstanding, that are
recorded by such Person and its Subsidiaries on a consolidated basis
(excluding (1) any such dividends, distributions and other payments
made solely to such Person or a wholly-owned Subsidiary of such Person
by a Subsidiary of such Person, (2) adjustments in the exercise price
of the Warrants made in accordance with the terms of the Warrants, and
(3) adjustments in the conversion price of the Convertible Preferred
Stock made in accordance with the terms of the Certificate of
Designation).
(b) amounts paid to purchase, redeem, retire or otherwise
acquire for value any of the capital stock of or other ownership
interests in, or any warrants, options or other rights in respect of
the capital stock of or other ownership interests in, such Person or
its Subsidiaries, now or hereafter outstanding (excluding any such
amounts paid solely to such Person or a wholly-owned Subsidiary of such
Person by a Subsidiary of such Person),
(c) any assets segregated or set apart by such Person or
any of its Subsidiaries (including any money or property deposited with
a trustee or other paying agent) for a sinking or analogous fund for
the purchase, redemption or retirement or other acquisition of any
capital stock of or other ownership interests in, or any warrants,
options or other
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rights in respect of any capital stock of or other ownership interests
in, such Person or its Subsidiaries, now or hereafter outstanding
(excluding any assets so segregated or set apart with respect to any
stock, warrants, options or other rights held by a wholly-owned
Subsidiary of such Person),
(d) payments made or required to be made by such Person
with respect to any stock appreciation rights plan, equity incentive or
achievement plan or any similar plan and any assets segregated or set
apart for such purposes (including any money or property deposited with
a trustee or other paying agent), and
(e) any payment, purchase, redemption or acquisition of
Subordinated Indebtedness and any assets segregated or set apart for
such purposes (including any money or property deposited with a trustee
or other paying agent), excluding, however, regularly scheduled
payments of interest made according to the stated terms of such
Subordinated Indebtedness;
all as determined in conformity with GAAP.
"Revolving Credit Commitments" shall mean, at any time, the commitment
of all the Lenders, collectively, to make Revolving Loans to the Borrower during
the Commitment Period pursuant to the provisions of Section 2.2, and the
"Revolving Credit Commitment" of any Lender at any time shall mean an amount
equal to such Lender's Percentage multiplied by the then effective aggregate
Revolving Credit Commitments. The Revolving Credit Commitments are in the
aggregate amount set forth in Section 2.1.
"Revolving Credit Facility" shall mean the revolving credit facility
provided by the Lenders pursuant to the Revolving Credit Commitments as more
particularly set forth in Section 2.2.1.
"Revolving Loans" shall mean the loans made by the Lenders to the
Borrower pursuant to the provisions of Section 2.2.1.
"Revolving Notes" shall mean the promissory notes, in substantially the
form of Exhibit 2.8A, executed by the Borrower in favor of the Lenders,
evidencing the indebtedness of the Borrower to the Lenders in connection with
the Revolving Loans.
"S&P" shall mean Standard & Poor's Corporation and its successors.
"Securities Purchase Agreement" shall mean the Securities Purchase
Agreement dated January 26, 1999, by and among the Borrower, Health Care Capital
Partners, L.P., a Delaware limited partnership, and Health Care Executive
Partners, L.P., a Delaware limited partnership.
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"Security Agreement" shall mean the Amended and Restated Security
Agreement, substantially in the form of Exhibit 4.1A, by and among the Borrower,
the Guarantors and the Administrative Agent.
"Security Documents" shall mean the Security Agreement, the Pledge
Agreement, the Assignment and Security Agreement and the Financing Statements,
together with all documents, instruments and agreements now or hereafter
executed or delivered pursuant thereto or in connection therewith.
"Service Contracts" shall mean contracts of the Borrower or a
Subsidiary of the Borrower with a Governmental Authority pursuant to which the
Borrower or such Subsidiary provides health care services to jailed or
imprisoned persons incarcerated pursuant to the authority of such Governmental
Authority or a related Governmental Authority.
"Single Employer Plan" shall mean any Plan that is not a Multi-Employer
Plan.
"Solvent" shall mean, with respect to any Person on any particular
date, that on such date (a) the fair value of the assets of such Person (both at
fair valuation and at present fair saleable value) is, on the date of
determination, greater than the total amount of liabilities, including
contingent and unliquidated liabilities, of such Person, (b) such Person is able
to pay all liabilities of such Person as they mature, and (c) such Person does
not have unreasonably small capital with which to carry on its business. In
computing the amount of contingent or unliquidated liabilities at any time, such
liabilities will be computed at the amount that, in light of all the facts and
circumstances existing at such time, represents the amount that can be
reasonably expected to become an actual or matured liability.
"Statutory Reserves" shall mean a fraction (expressed as a decimal),
the numerator of which is the number one and the denominator of which is the
number one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves), expressed as a decimal,
established by the Federal Reserve Board or any other banking authority to which
any Lender or any member bank of the Federal Reserve System is subject with
respect to LIBOR, for Eurocurrency Liabilities (as defined in Regulation D of
the Federal Reserve Board). Such reserve percentages shall include those imposed
under such Regulation D. LIBOR Loans shall be deemed to constitute Eurocurrency
Liabilities and as such shall be deemed to be subject to such reserve
requirements without benefit of or credit for proration, exceptions or offsets
that may be available from time to time to the Lenders under such Regulation D.
Statutory Reserves shall be adjusted automatically on and as of the effective
date of any change in any reserve percentage.
"Subordinated Indebtedness" shall mean, for the Borrower and its
Subsidiaries on a consolidated basis, all Indebtedness subordinated in right of
payment to the Obligations on terms satisfactory to the Administrative Agent.
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"Subsidiary" shall mean, as to any Person (a) a corporation, limited
liability company or other entity of which shares of stock or other ownership
interests having ordinary voting power (other than stock having such power only
by reason of the occurrence of a contingency) to elect a majority of the board
of directors or other managers thereof are at the time owned, or the management
of which is otherwise controlled, directly or indirectly, through one or more
intermediaries, or both, by such Person, or (b) a partnership in which such
Person is a general partner or the management of which is otherwise controlled,
directly or indirectly, through one or more intermediaries or both, by such
Person.
"Swing Line Commitment" shall mean the commitment of the Swing Line
Lender to make Swing Line Loans pursuant to Section 2.2.6.
"Swing Line Facility" shall mean the swing line credit facility
provided by the Swing Line Lender pursuant to the Swing Line Commitment as more
particularly set forth in Section 2.2.6.
"Swing Line Lender" shall mean Bank of America and any other financial
institution that, subject to approval by the Administrative Agent and the
Borrower, agrees to become a party to this Agreement and to make Swing Line
Loans pursuant to Section 2.2.6. As used herein and in the other Loan Documents,
"Lender" shall include the Swing Line Lender except to the extent that the
context requires otherwise.
"Swing Line Loans" shall mean the loans made by the Swing Line Lender
pursuant to Section 2.2.6.
"Swing Line Note" shall mean the promissory note, in substantially the
form of Exhibit 2.8B, executed by the Borrower in favor of the Swing Line
Lender, evidencing the indebtedness of the Borrower to the Swing Line Lender in
connection with the Swing Line Loans.
"UCC" shall mean the Uniform Commercial Code as in effect in the State
of Tennessee or any other applicable jurisdiction, as the context may require.
"Warrants" shall mean the detachable warrants to purchase shares of the
common stock of the Borrower issued by the Borrower pursuant to the Securities
Purchase Agreement.
1.2. Accounting and Commercial Terms. As used in this Agreement,
all accounting terms used but not otherwise defined herein shall have the
respective meanings assigned to them in conformity with GAAP. All terms used but
not otherwise defined herein that are defined or used in Article 9 of the UCC
shall have the respective meanings assigned to them in such Article.
1.3. General Construction. As used in this Agreement, the
masculine, feminine and neuter genders and the plural and singular numbers shall
be deemed to include the others in all cases in which they would so apply.
"Includes" and "including" are not limiting, and shall be
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deemed to be followed by "without limitation" regardless of whether such words
or words of like import in fact follow same. The word "or" is not intended and
shall not be construed to be exclusive.
1.4. Defined Terms; Headings. The use of defined terms in the Loan
Documents is for convenience of reference and the specific words used as defined
terms shall not be deemed to be limiting or to have any other substantive effect
with respect to the persons or things to which reference is made through the use
of such defined terms. Article and section headings and captions in the Loan
Documents are included in such Loan Documents for convenience of reference and
shall not constitute a part of the applicable Loan Documents for any other
purpose.
1.5. References to this Agreement and Parts Thereof. As used in
this Agreement, unless otherwise specified the words "hereof," "herein" and
"hereunder" and words of similar import shall refer to this Agreement including
all schedules and exhibits hereto, as a whole, and not to any particular
provision of this Agreement, and the words "Article", "Section", "Schedule" and
"Exhibit" refer to articles, sections, schedules and exhibits of or to this
Agreement.
1.6. Documentary References. Any reference herein to any
instrument, document or agreement, by whatever terminology used, shall be deemed
to include any and all amendments, modifications, supplements, extensions,
renewals, substitutions or replacements thereof as the context may require.
Notwithstanding the foregoing, as used herein "Certificate of Designation",
"Convertible Preferred Stock", "Securities Purchase Agreement" and "Warrants"
shall mean and refer only to such instruments as in effect on January 26, 1999,
together with any amendments thereto or modifications thereof that have been
approved in writing by Requisite Lenders.
1.7. Legal References. Any reference herein to any law shall be a
reference to such law as in effect from time to time and shall include any rules
and regulations promulgated or published thereunder and published
interpretations thereof.
ARTICLE 2
LOANS AND LETTERS OF CREDIT
2.1. Commitments.
2.1.1. Amounts of Commitments.
(a) The aggregate amount of the Commitments is
$65,000,000, subject to reduction as provided in Section 2.1.2.
(b) The aggregate amount of the Revolving Credit
Commitments at any time is equal to the aggregate amount of the
Commitments in effect at such time less the aggregate amount of Letter
of Credit Liabilities outstanding at such time.
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(c) The aggregate amount of the Letter of Credit
Commitments at any time is equal to the lesser of (i) the aggregate
amount of the Commitments in effect at such time less the aggregate
amount of Loans outstanding at such time, or (ii) $5,000,000.
2.1.2. Voluntary Reductions of Commitments. The Borrower shall
have the right, at any time and from time to time, to terminate in whole or
permanently reduce in part, without premium or penalty, the Commitments in an
amount up to the amount by which the Commitments exceed the aggregate amount of
the then outstanding Loans and Letter of Credit Liabilities. The Borrower shall
give not less than ten (10) Business Days' prior written notice to the
Administrative Agent designating the date (which shall be a Business Day) of
such termination or reduction and the amount of any reduction. Promptly after
receipt of a notice of such termination or reduction, the Administrative Agent
shall notify each Lender of the proposed termination or reduction. Such
termination or reduction of the Commitments shall be effective on the date
specified in the Borrower's notice and shall reduce the Commitment of each
Lender in proportion to its Percentage of the Commitments. Any such reduction of
the Commitments shall be in a minimum amount of $1,000,000 and in integral
multiples of $1,000,000.
2.2. Loans.
2.2.1. Commitment to Make Revolving Loans. Subject to all of
the terms and conditions of this Agreement (including the conditions set forth
in Sections 6.1 and 6.2) and in reliance upon the representations and warranties
of the Borrower herein set forth, each Lender hereby severally agrees to make
Revolving Loans to the Borrower from time to time during the Commitment Period,
for the purposes identified in Section 2.10; provided, however, that in no event
shall:
(a) the aggregate principal amount of Revolving Loans
made by any Lender outstanding at any time exceed such Lender's
Revolving Credit Commitment, or
(b) the aggregate principal amount of Loans outstanding
at any time exceed the Revolving Credit Commitments.
Each Lender's Revolving Credit Commitment shall expire on the Commitment Period
Expiration Date, and all Revolving Loans shall be paid in full no later than the
Maturity Date.
2.2.2. Lenders' Obligations Several; Proportionate Loans. The
obligations of the Lenders to make Revolving Loans under Section 2.2.1 shall be
several and not joint and, subject to Section 2.14.4, all Revolving Loans under
this Agreement shall be made by the Lenders simultaneously and proportionately
to their respective Percentages of the Revolving Credit Commitments. It is
understood and agreed that the failure of any Lender to make its Revolving Loan
as part of any Borrowing under Section 2.2.1 shall not relieve any other Lender
of its obligation to make its Revolving Loan as provided in Section 2.2.1.
Neither the Administrative Agent nor any Lender shall be responsible for the
failure of any other Lender to make a
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Revolving Loan as provided herein nor shall the Revolving Credit Commitment of
any Lender be increased as a result of the default by any other Lender in such
other Lender's obligation to make Revolving Loans hereunder.
2.2.3. Revolving Credit; Minimum Borrowings. Amounts borrowed
by the Borrower under the Revolving Credit Commitments may be prepaid and
reborrowed from time to time to during the Commitment Period. The Revolving
Loans made on any Funding Date shall be in an aggregate minimum amount of
$500,000 and integral multiples of $100,000 in excess of that amount.
2.2.4. Notice of Borrowing.
(a) Delivery of Notice. Whenever the Borrower desires to
borrow under Section 2.2.1, it shall deliver to the Administrative
Agent a Notice of Borrowing no later than 12:00 noon (Eastern time) at
least one (1) Business Day in advance of the proposed Funding Date (in
the case of Base Rate Loans) or three (3) Business Days in advance of
the proposed Funding Date (in the case of LIBOR Loans). The Notice of
Borrowing shall specify (i) the proposed Funding Date (which shall be a
Business Day), (ii) the amount of the proposed Borrowing, (iii) whether
the proposed Borrowing shall be in the form of Base Rate Loans or LIBOR
Loans, (iv) in the case of LIBOR Loans, the requested Interest Period,
and (v) the purposes for which the proceeds of the proposed Borrowing
will be used. In lieu of delivering a Notice of Borrowing, the Borrower
may give the Administrative Agent telephonic notice by the required
time of notice of any proposed Borrowing under this Section 2.2.4;
provided, however, that such notice shall be promptly confirmed in
writing by delivery of a Notice of Borrowing to the Administrative
Agent on or prior to the Funding Date of the requested Revolving Loans.
The execution and delivery of each Notice of Borrowing shall be deemed
a representation and warranty by the Borrower that the requested
Revolving Loans may be made in accordance with, and will not violate
the requirements of, this Agreement, including those set forth in
Section 2.2.1.
(b) No Liability for Telephonic Notices. Neither the
Administrative Agent nor any Lender shall incur any liability to the
Borrower in acting upon any telephonic notice given pursuant to this
Section 2.2.4 that the Administrative Agent believes in good faith to
have been given by a duly authorized officer or other person authorized
to borrow on behalf of the Borrower or for otherwise acting in good
faith under this Section 2.2.4 and, upon the funding of Revolving Loans
by the Lenders in accordance with this Agreement pursuant to any
telephonic notice, the Borrower shall have effected a Borrowing of
Revolving Loans hereunder.
(c) Notice Irrevocable. A Notice of Borrowing for LIBOR
Loans (or a telephonic notice in lieu thereof) shall be irrevocable on
and after the related Interest Rate Determination Date, and the
Borrower shall be bound to make a Borrowing in accordance therewith.
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2.2.5. Disbursement of Funds. Promptly after receipt of a
Notice of Borrowing (or telephonic notice in lieu thereof), the Administrative
Agent shall notify each Lender of the proposed Borrowing in writing, or by
telephone promptly confirmed in writing. Each Lender shall make the amount of
its Revolving Loan available to the Administrative Agent, in immediately
available funds, at the Lending Office of the Administrative Agent, not later
than 12:00 noon (Eastern time) on the Funding Date. The Administrative Agent
shall make the proceeds of such Revolving Loans available to the Borrower on
such Funding Date by causing an amount of immediately available funds equal to
the proceeds of all such Revolving Loans received by the Administrative Agent to
be credited to the account of the Borrower at such office of the Administrative
Agent or, if so directed by the Borrower in writing, the Administrative Agent
shall disburse the proceeds of such Revolving Loans pursuant to such directions
on such Funding Date or as soon thereafter as is reasonably practicable.
2.2.6. Swing Line Loans.
(a) Commitment to Make Swing Line Loans. Subject to all
of the terms and conditions of this Agreement (including the conditions
set forth in Sections 6.1 and 6.2 and the limitations set forth in
Section 2.2.1), and in reliance upon the representations and warranties
of the Borrower herein set forth and the agreements of the other
Lenders set forth in subsections (c) and (d) of this Section 2.2.6, the
Swing Line Lender hereby agrees to make Swing Line Loans to the
Borrower from time to time during the Commitment Period, for the
purposes identified in Section 2.10, in an aggregate principal amount
outstanding at any time not to exceed the lesser of (i) the difference
between the Revolving Credit Commitments in effect at such time and the
Revolving Loans outstanding at such time, or (ii) $10,000,000. Amounts
borrowed by the Borrower under the Swing Line Commitment may be prepaid
and reborrowed from time to time during the Commitment Period. The
Swing Line Lender's commitment to make Swing Line Loans as provided in
this subsection 2.2.6(a) shall expire on the Commitment Period
Expiration Date, and all Swing Line Loans shall be paid in full no
later than the Maturity Date. Except to the extent that funding of
Swing Line Loans is being administered through an automated cash
management system mutually approved in writing by the Borrower and the
Swing Line Lender, each Swing Line Loan Borrowing shall be in the
amount of $100,000 and integral multiples of $50,000 in excess of that
amount.
(b) Funding Procedures for Swing Line Loans. Except to
the extent that funding of Swing Line Loans is being administered
through an automated cash management system mutually approved in
writing by the Borrower and the Swing Line Lender, the Borrower shall
give to the Swing Line Lender written notice (or oral notice to be
confirmed promptly in writing) of a proposed Swing Line Loan Borrowing,
specifying the amount of the requested Swing Line Loan, not later than
12:00 noon, Eastern time, on the Business Day of the proposed
Borrowing. Each request for a Swing Line Loan shall be deemed a
representation and warranty by the Borrower that the requested Swing
Line Loan may be made in accordance with, and will not violate the
requirements of, this
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Agreement, including those set forth in subsection 2.2.6(a). Not later
than 2:00 p.m., Eastern time, on the Business Day of the proposed Swing
Line Loan Borrowing, the Swing Line Lender shall make the proceeds of
the requested Swing Line Loan available to the Borrower at the office
of the Swing Line Lender by crediting an account of the Borrower
maintained at such office.
(c) Repayment of Swing Line Loans With Revolving Loans.
Regardless of whether the conditions set forth in Sections 6.1 and 6.2
have been or are capable of being satisfied, and regardless of the
limitation(s) set forth in Section 2.2.3, on any Business Day the Swing
Line Lender may, in its sole discretion, give notice to the Lenders
that some part or all of the outstanding Swing Line Loans are to be
repaid on the next succeeding Business Day with a Borrowing of
Revolving Loans constituting Base Rate Loans made pursuant to Section
2.2.1 in the same manner and with the same force and effect as if the
Borrower had submitted a Notice of Borrowing therefor pursuant to
Section 2.2.4. Subject to and in accordance with Sections 2.2.1 and
2.2.2, each Lender shall make the amount of its Revolving Loan
available to the Administrative Agent, in immediately available funds,
at the Lending Office of the Administrative Agent, not later than 12:00
noon (Eastern time) on the applicable Funding Date. The Administrative
Agent shall make the proceeds of such Revolving Loans available to the
Swing Line Lender on such Funding Date by causing an amount of
immediately available funds equal to the proceeds of all such Revolving
Loans received by the Administrative Agent to be credited to an account
of the Swing Line Lender at such office of the Administrative Agent, or
shall make such proceeds available to the Swing Line Lender in such
other manner as shall be satisfactory to the Administrative Agent and
the Swing Line Lender.
(d) Participations in Swing Line Loans. If for any reason
a requested Borrowing of Revolving Loans pursuant to subsection
2.2.6(c) is not or cannot be effected, the Lenders will immediately
purchase from the Swing Line Lender, as of the date such proposed
Borrowing otherwise would have occurred but adjusted for any payments
received in respect of such Swing Line Loan(s) by or for the account of
the Borrower on or after such date but prior to such purchase, such
participations in the outstanding Swing Line Loans as shall be
necessary to cause the Lenders to share in such Swing Line Loan(s)
proportionately in accordance with their respective Percentages of the
Revolving Credit Commitments. Whenever, at any time after any Lender
has purchased a participating interest in a Swing Line Loan, the Swing
Line Lender receives any payment on account thereof, the Swing Line
Lender will distribute to such Lender its proportionate share of such
amount (appropriately adjusted, in the case of interest payments, to
reflect the period of time during which such Lender's participating
interest was outstanding and funded); provided, however, that in the
event any such payment received by the Swing Line Lender is
subsequently set aside or is required to be refunded, returned or
repaid, such Lender will repay to the Swing Line Lender its
proportionate share thereof.
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(e) Failure to Pay by Lenders. If any Lender shall fail
to perform its obligation to make a Revolving Loan pursuant to
subsection 2.2.6(c) or to purchase a participation in Swing Line Loans
pursuant to subsection 2.2.6(d), the amount in default shall bear
interest for each day from the day such amount is payable until fully
paid at a rate per annum equal to the Federal Funds Rate or any other
rate customarily used by banks for the correction of errors among
banks, but in no event to exceed the Highest Lawful Rate, and such
obligation may be satisfied by application by the Administrative Agent
(for the account of the Swing Line Lender) of any payment that such
Lender otherwise is entitled to receive under this Agreement. Pending
repayment, each such advance shall be secured by such Lender's
participation interest, if any, in the Swing Line Loans and any
security therefor, and the Swing Line Lender shall be subrogated to
such Lender's rights hereunder in respect thereof.
(f) Lenders' Obligations Absolute. The obligation of each
Lender to make Revolving Loans pursuant to subsection 2.2.6(c) and to
purchase participations in Swing Line Loans pursuant to subsection
2.2.6(d) shall be unconditional and irrevocable, shall not be subject
to any qualification or exception whatsoever, shall be made in
accordance with the terms and conditions of this Agreement under all
circumstances and shall be binding in accordance with the terms and
conditions of this Agreement under all circumstances, including the
following circumstances:
(1) any lack of validity or enforceability of
this Agreement, any of the other Loan Documents or any other
instrument, document or agreement relating to the transactions
that are the subject thereof;
(2) the existence of any claim, set-off, defense
or other right that the Borrower, any Guarantor or any Lender
may have at any time against the Administrative Agent, the
Swing Line Lender, any other Lender or any other Person,
whether in connection with this Agreement, the transactions
contemplated herein or any related transactions;
(3) the surrender or impairment of any security
for the performance or observance of any of the terms of this
Agreement;
(4) the occurrence or continuance of any
Default;
(5) any adverse change in the condition
(financial or other) of the Borrower or any Guarantor; or
(5) any other reason.
2.3. Letters of Credit.
2.3.1. Issuance of Letters of Credit.
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(a) The Borrower may request the Issuing Bank at any time
and from time to time during the Commitment Period to issue, and
subject to and upon all of the terms and conditions of this Agreement
(including the conditions set forth in Sections 6.1 and 6.2) and in
reliance upon the representations and warranties of the Borrower herein
set forth the Issuing Bank shall issue, for the account of the Borrower
and for the benefit of the holder(s) (or any trustee, agent or other
representative of such holder(s)) of Letter of Credit Supportable
Obligations of the Borrower and its Subsidiaries, one or more
irrevocable standby letters of credit in the form customarily used by
such Issuing Bank, or in such other form as has been approved by the
Issuing Bank and the Administrative Agent, in support of such Letter of
Credit Supportable Obligations; provided, however, that:
(1) each Letter of Credit shall be in a minimum
stated amount of $100,000,
(2) each Letter of Credit by its terms shall
terminate no later than fifteen (15) days prior to the
Maturity Date, and
(3) in no event shall any Letter of Credit be
issued if the issuance thereof would cause the aggregate
amount of the then outstanding Letter of Credit Liabilities to
exceed the aggregate amount of the Letter of Credit
Commitments.
(b) The Borrower may request the Issuing Bank at any time
and from time to time during the Commitment Period to extend, and
subject to and upon all of the terms and conditions of this Agreement
(including the conditions set forth in Sections 6.1 and 6.2) and in
reliance upon the representations and warranties of the Borrower herein
set forth the Issuing Bank shall extend, the expiration date of an
outstanding Letter of Credit; provided, however, that each such
extension shall be subject to all applicable limitations and other
provisions set forth in paragraph (a) of this Section 2.3.1.
2.3.2. Letter of Credit Requests. At least five (5) Business
Days prior to (i) the date on which the Borrower desires that a Letter of Credit
be issued hereunder or (ii) the date on which the Borrower desires that the
expiration date of an outstanding Letter of Credit be extended, as the case may
be, the Borrower shall deliver to the Issuing Bank (with copies to the
Administrative Agent and each Lender) a Letter of Credit Request therefor. The
execution and delivery of each Letter of Credit Request shall be deemed a
representation and warranty by the Borrower that the requested Letter of Credit
issuance or extension may be accomplished in accordance with, and will not
violate the requirements of, this Agreement, including those set forth in
Section 2.3.1. Unless the Issuing Bank has received notice from the
Administrative Agent or Requisite Lenders before it issues or extends the
requested Letter of Credit that a Default exists or that the requested issuance
or extension would violate the requirements of this Agreement, including those
set forth in Section 2.3.1, then the Issuing Bank may issue or extend, as the
case may be, the requested Letter of Credit for the account of the Borrower in
accordance
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with the Issuing Bank's usual and customary practices. Upon the issuance or
extension of any Letter of Credit, the Issuing Bank shall promptly notify the
Administrative Agent and each Lender of such issuance or extension, which notice
to the Administrative Agent shall be accompanied by a copy of the Letter of
Credit so issued or the instrument(s) evidencing such extension.
2.4. Participations in Letter of Credit Liabilities.
2.4.1. Purchase of Participations by Lenders. Each Lender
shall be deemed to have irrevocably and unconditionally purchased and received
from the Issuing Bank, without recourse or warranty and without any further
action on the part of any party, an undivided interest and participation to the
extent of such Lender's Percentage in all Letter of Credit Liabilities as to
each Letter of Credit and any security therefor or guarantee relating thereto.
2.4.2. Notification by Issuing Bank of Drawing. The Issuing
Bank shall notify the Administrative Agent and each Lender promptly after the
presentation of any draft and certificate or equivalent documents to the Issuing
Bank in connection with any drawing under a Letter of Credit not reimbursed by
or on behalf of the Borrower on the date such drawing is made.
2.4.3. Payments by Lenders Upon a Drawing or Payment Under a
Letter of Credit; Adjustments. Each of the Lenders, shall, on or before 12:00
noon (Eastern time) on the date of any drawing under a Letter of Credit,
unconditionally pay to the Administrative Agent, for distribution by the
Administrative Agent to the Issuing Bank, such Lender's Percentage of such
drawing; provided, however, that, if the Borrower should pay in full or in part
such drawing on the date thereof, the obligation of each Lender to pay to the
Issuing Bank pursuant to this Section 2.4.3 such Lender's Percentage of such
drawing shall be reduced by the amount equal to such Lender's Percentage of such
payment by the Borrower. Amounts paid in excess of the net amount so owed by
each Lender to the Issuing Bank shall promptly be refunded by the Issuing Bank
to the Administrative Agent for distribution by the Administrative Agent to the
respective Lenders.
2.4.4. Failure to Pay by Lenders. If any Lender shall fail
to pay its Percentage of any drawing under a Letter of Credit as provided in
Section 2.4.3 above, the Issuing Bank shall be deemed to have advanced funds on
behalf of such Lender. Any advance made by the Issuing Bank on behalf of a
Lender hereunder and not paid by such Lender to the Issuing Bank shall bear
interest for each day from the day such payment is due until such payment shall
be paid in full at a rate per annum equal to the Federal Funds Rate or any other
rate customarily used by banks for the correction of errors among banks, but in
no event to exceed the Highest Lawful Rate, and shall be repaid by application
by the Administrative Agent (for the account of the Issuing Bank) of any payment
that such Lender otherwise is entitled to receive under this Agreement. Pending
repayment, each such advance shall be secured by such Lender's participation
interest in the Letter of Credit drawn upon, the Letter of Credit Liabilities
arising therefrom and any security
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therefor, and the Issuing Bank shall be subrogated to such Lender's rights
hereunder in respect thereof.
2.4.5. Lenders' Obligations Absolute. The obligation of each
Lender to pay to the Administrative Agent, for the benefit of the Issuing Bank,
its Percentage of each drawing under a Letter of Credit not indefeasibly repaid
by the Borrower shall be unconditional and irrevocable, shall not be subject to
any qualification or exception whatsoever, shall be made in accordance with the
terms and conditions of this Agreement under all circumstances and shall be
binding in accordance with the terms and conditions of this Agreement under all
circumstances, including the following circumstances:
(a) any lack of validity or enforceability of this
Agreement, any of the other Loan Documents or any other instrument,
document or agreement relating to the transactions that are the subject
thereof;
(b) the existence of any claim, set-off, defense or other
right that the Borrower, any Guarantor or any Lender may have at any
time against the Administrative Agent, the Issuing Bank, any Lender or
any other Person, whether in connection with this Agreement or the
transactions contemplated herein or any related transactions;
(c) any draft, statement or other document presented
under or in connection with any Letter of Credit, this Agreement or any
other Loan Document proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(d) the surrender or impairment of any security for the
performance or observance of any of the terms of this Agreement;
(e) the occurrence or continuance of any Default;
(f) payment by the Issuing Bank under a Letter of Credit
against presentation of a draft or certificate that does not comply
with the terms of the Letter of Credit, except for any such payment
resulting from the Issuing Bank's gross negligence or willful
misconduct; or
(g) any other reason.
2.4.6. Information Regarding Letter of Credit Liabilities.
Upon request by the Administrative Agent from time to time, the Issuing Bank
shall advise the Administrative Agent and the Lenders as to the various amounts
of the outstanding Letter of Credit Liabilities as shown on the records of the
Issuing Bank.
2.5. Borrower's Obligations Absolute.
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2.5.1. Obligations Absolute. The obligations of the Borrower
under this Agreement in respect of any Letter of Credit and under any other
agreement or instrument relating to any Letter of Credit shall be unconditional
and irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement and such other agreement or instrument under all circumstances, to the
extent permitted by law, including the following circumstances:
(a) any lack of validity or enforceability of this
Agreement, any of the other Loan Documents or any other instrument,
document or agreement relating to the transactions that are the subject
thereof;
(b) any change in the time, manner or place of payment
of, or in any other term of, all or any of the obligations of the
Borrower in respect of the Letters of Credit or any other amendment or
waiver of or any consent to departure from all or any of the Loan
Documents;
(c) any exchange or release of, or the non-perfection of
any Lien on any Collateral, or any release or amendment or waiver of or
consent to departure from any guaranty, for all or any of the Letter of
Credit Obligations;
(d) the existence of any claim, set-off, defense or other
right that the Borrower or any Guarantor may have at any time against
any beneficiary or any transferee of a Letter of Credit (or any Persons
for whom any such beneficiary or transferee may be acting), any of the
Lenders, the Issuing Bank, the Administrative Agent or any other
Person, whether in connection with this Agreement, any of the other
Loan Documents or the transactions contemplated hereby or thereby or
any unrelated transaction;
(e) any draft, statement or other document presented
under or in connection with any Letter of Credit, this Agreement or any
other Loan Document proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(f) payment by the Issuing Bank under a Letter of Credit
against presentation of a draft or certificate that does not comply
with the terms of the Letter of Credit, except for any such payment
resulting from the Issuing Bank's gross negligence or willful
misconduct;
(g) any consequences arising from causes beyond the
control of the Issuing Bank; and
(h) any other circumstances or happening whatsoever,
regardless of whether similar to any of the foregoing, that might
otherwise constitute a defense available to, or a discharge of, the
Borrower or any Guarantor.
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2.5.2. No Liability. No action taken or omitted by the
Issuing Bank under or in connection with the Letters of Credit or the related
applications, agreements or certificates, if taken or omitted in good faith,
shall put the Administrative Agent, the Issuing Bank or any Lender under any
resulting liability to the Borrower.
2.6. Interest.
2.6.1. Interest Rate on Loans. Subject to Section 2.6.3, the
unpaid principal balances of the Loans shall bear interest from their respective
Funding Dates through maturity (whether by acceleration or otherwise) (including
post-petition interest in any proceeding under applicable bankruptcy laws) at a
rate determined by reference to the Base Rate or LIBOR. The applicable basis for
determining the rate of interest for Revolving Loans shall be selected by the
Borrower at the time a Notice of Borrowing is given pursuant to Section 2.2.4 or
at the time a Notice of Conversion/Continuation is given pursuant to Section
2.7.2. If on any day any Revolving Loan is outstanding with respect to which
notice has not been delivered to the Administrative Agent in accordance with the
terms of this Agreement specifying the basis for determining the rate of
interest, then for that day such Revolving Loan shall bear interest determined
by reference to the Base Rate. The Loans shall bear interest as follows:
(a) if a Swing Line Loan or a Base Rate Loan, then at a
fluctuating rate per annum equal to the sum of the Base Rate, as it
varies from time to time, plus the Applicable Base Rate Margin; or
(b) if a LIBOR Loan, then at a rate per annum equal to
the sum of LIBOR plus the Applicable LIBOR Margin.
2.6.2. Interest Rate on Unreimbursed Draws Under Letters of
Credit. The unpaid principal amount of all draws under Letters of Credit not
immediately repaid pursuant to Section 3.2 shall bear interest from the date of
such drawing until the principal balance thereof is paid in full at the Default
Rate applicable to Base Rate Loans. Interest accruing pursuant to this Section
2.6.2 shall be payable upon demand.
2.6.3. Default Rate. Upon the occurrence and during the
continuance of an Event of Default, at the election of Required Lenders or the
Administrative Agent the unpaid principal balances of the Loans and, to the
extent permitted by applicable law, any unpaid interest accrued in respect of
the Loans shall bear interest at the Default Rate; provided, however, that in
the case of LIBOR Loans, upon the expiration of the Interest Period in effect at
the time any such increase in interest rate is effective, such LIBOR Loans shall
thereupon become Base Rate Loans and thereafter bear interest at the
corresponding Default Rate. Interest accruing pursuant to this Section 2.6.3
shall be payable upon demand.
2.6.4. Conclusive Determination. Each determination by the
Administrative Agent of an interest rate under this Agreement shall be
conclusive and binding for all purposes, absent manifest error.
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2.7. Conversion or Continuation.
2.7.1. Option to Convert or Continue. Subject to the
provisions of Section 2.14, the Borrower shall have the option (a) at any time
to convert all or any part of any outstanding Base Rate Loans in an aggregate
minimum amount of $500,000 and integral multiples of $100,000 in excess of that
amount from Base Rate Loans to LIBOR Loans, and (b) upon the expiration of any
Interest Period applicable to a specific Borrowing of LIBOR Loans, to continue
all or any portion of such Loans in an aggregate minimum amount of $500,000 and
integral multiples of $100,000 in excess of that amount as LIBOR Loans, and the
succeeding Interest Period of such continued LIBOR Loans shall commence on the
expiration date of the Interest Period previously applicable thereto.
2.7.2. Notice of Conversion/Continuation. The Borrower shall
deliver a Notice of Conversion/Continuation to the Administrative Agent no later
than 12:00 noon (Eastern time) at least three (3) Business Days in advance of
the proposed conversion/continuation date. A Notice of Conversion/Continuation
shall specify (a) the proposed conversion/continuation date (which shall be a
Business Day), (b) the aggregate amount of Loans to be converted/continued, (c)
the nature of the proposed conversion/continuation, and (d) the requested
Interest Period. In lieu of delivering a Notice of Conversion/Continuation, the
Borrower may give the Administrative Agent telephonic notice by the required
time of any proposed conversion/continuation under this Section 2.7; provided,
however, that such notice shall be promptly confirmed in writing by a Notice of
Conversion/Continuation delivered to the Administrative Agent on or before the
proposed conversion/continuation date. The execution and delivery of each Notice
of Conversion/Continuation shall be deemed a representation and warranty by the
Borrower that the requested conversion/continuation may be made in accordance
with, and will not violate the requirements of, this Agreement, including those
set forth in Sections 2.7.1 and 2.14.1.
2.7.3. Notice to the Lenders. Promptly after receipt of a
Notice of Conversion/Continuation (or telephonic notice in lieu thereof), the
Administrative Agent shall notify each Lender of the proposed conversion or
continuation. Neither the Administrative Agent nor the Lender shall incur any
liability to the Borrower in acting upon any telephonic notice referred to above
that the Administrative Agent believes in good faith to have been given by a
duly authorized officer or other person authorized to act on behalf of the
Borrower or for otherwise acting in good faith under this Section 2.7 and, upon
conversion/continuation by the Administrative Agent in accordance with this
Agreement pursuant to any telephonic notice, the Borrower shall have effected a
conversion/continuation of Loans hereunder.
2.7.4. Notice Irrevocable. Except as provided in Section
3.4.5, a Notice of Conversion/Continuation shall be irrevocable on and after the
related Interest Rate Determination Date, and the Borrower shall be bound to
convert or continue such Loan in accordance therewith.
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2.7.5. Automatic Conversion. In the event any LIBOR Loan is
unpaid upon the expiration of the Interest Period applicable thereto and a
Notice of Conversion/Continuation has not been given in the manner provided in
Section 2.7.2, such LIBOR Loan shall, effective as of the last day of such
Interest Period, become a Base Rate Loan.
2.8. Notes; Records of Payments. Each Revolving Loan made by a
Lender to the Borrower pursuant to this Agreement shall be evidenced by a
Revolving Note payable to the order of such Lender in an amount equal to such
Lender's Percentage of the aggregate amount of the Commitments, and the Swing
Line Loans made by the Swing Line Lender to the Borrower pursuant to this
Agreement shall be evidenced by the Swing Line Note. Each Lender (including the
Swing Line Lender) hereby is authorized to record and endorse the date and
principal amount of each Loan made by it, and the amount of all payments and
prepayments of principal and interest made to such Lender with respect to such
Loans, on a schedule annexed to and constituting a part of the corresponding
Note(s) of such Lender, which recordation and endorsement shall constitute prima
facie evidence of such Loans made by such Lender to the Borrower and payments
made by the Borrower to such Lender, absent manifest error; provided, however,
that (a) failure by any Lender to make any such recordation or endorsement shall
not in any way limit or otherwise affect the obligations of the Borrower or the
rights and remedies of the Lenders under this Agreement or the Notes, and (b)
payments of principal and interest on the Loans to the Lenders shall not be
affected by the failure to make any such recordation or endorsement thereof. In
lieu of making recordation or endorsement, the Lenders hereby are authorized, at
their option, to record the payments or prepayments on their respective books
and records in accordance with their usual and customary practice, which
recordation shall constitute prima facie evidence of the Loans made by the
Lenders to the Borrower and the payments and prepayments made by the Borrower to
the Lenders, absent manifest error.
2.9. Administrative Agent's Right to Assume Funds Available. The
Administrative Agent may assume that each Lender has made the proceeds of its
Revolving Loans available to the Administrative Agent on the corresponding
Funding Date in the event the applicable conditions precedent to funding the
requested Revolving Loans set forth in Article 6 have been satisfied or waived
in accordance with Section 14.3, and the Administrative Agent, in its sole
discretion, may, but shall not be obligated to, advance all or any portion of
the amount of any requested Borrowing on such Funding Date to the Borrower prior
to receiving the proceeds of the corresponding Revolving Loans from the Lenders.
If the Administrative Agent has advanced proceeds of any Revolving Loan to the
Borrower on behalf of any Lender and such Lender fails to make available to the
Administrative Agent its Percentage share of such Revolving Loan as required by
Section 2.2, the Administrative Agent shall be entitled to recover such amount
on demand from such Lender. If such Lender does not pay such amount forthwith
upon the Administrative Agent's demand therefor, the Administrative Agent shall
notify the Borrower and the Borrower shall pay such amount to the Administrative
Agent. The Administrative Agent also shall be entitled to recover from such
Lender interest at the Federal Funds Rate or any other rate customarily used by
banks for the correction of errors among banks, but in no event to exceed the
Highest Lawful Rate, on such amount so advanced on behalf of a Lender for each
day from the date such amount was made available by the Administrative Agent to
the Borrower to
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the date such amount is recovered by the Administrative Agent, with interest at
the applicable rate for such Revolving Loan. Nothing herein shall be deemed to
relieve any Lender from its obligation to fulfill such Lender's Commitments or
to prejudice any rights that the Administrative Agent or the Borrower may have
against any Lender as a result of any default by such Lender hereunder.
2.10. Use of Proceeds. The proceeds of the Loans will be used by the
Borrower for working capital purposes, Capital Expenditures and other general
corporate purposes (including the financing of Permitted Acquisitions), and will
not be used by the Borrower for any purpose prohibited by the terms of this
Agreement or by any law.
2.11. Credit Fees. In consideration for the obligations of the
Administrative Agent, the Issuing Bank and the Lenders set forth herein, the
Borrower shall pay the following credit fees:
2.11.1. Administrative Agent's Fees. Pursuant to one or more
separate agreements with the Administrative Agent, the Borrower shall pay to
the Administrative Agent the fees and charges specified therein for the services
of the Administrative Agent in acting as such hereunder.
2.11.2. Commitment Fees. The Borrower agrees to pay to the
Administrative Agent, for distribution to each Lender in proportion to that
Lender's Percentage of the Commitments, annual commitment fees ("Commitment
Fees") for the period commencing on the date hereof to but excluding the
Commitment Period Expiration Date in amounts equal to the product obtained by
multiplying (a) the average of the daily unused portion of the Commitments
(i.e., the aggregate amount of the Commitments, less the aggregate amount of
Revolving Loans and Letter of Credit Liabilities outstanding, but without
reduction for outstanding Swing Line Loans), by (b) the Applicable Commitment
Fee Percentage. Commitment Fees shall be payable in quarter-annual installments,
in arrears, on January 1, April 1, July 1 and October 1 of each year, commencing
October 1, 2000, and on the Commitment Period Expiration Date.
2.11.3. Letter of Credit Fees. The Borrower agrees to pay to
the Administrative Agent, for distribution to each Lender in proportion to that
Lender's Percentage of the Commitments, annual letter of credit fees ("Letter of
Credit Fees") for the period commencing on the date hereof to but excluding the
Commitment Period Expiration Date in amounts equal to the product obtained by
multiplying (a) the daily average amount available to be drawn under Letters of
Credit by (b) the Applicable Letter of Credit Fee Percentage in effect on the
date of payment. Letter of Credit Fees shall be payable in quarter-annual
installments, in arrears, on January 1, April 1, July 1 and October 1 of each
year, commencing October 1, 2000, and on the Commitment Period Expiration Date.
2.11.4. Opening Fees; Amendment or Transfer Fees; Drawing
Fees.
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(a) Upon the issuance of a Letter of Credit, the Borrower
shall pay to the Issuing Bank a Letter of Credit opening fee in an
amount equal to the amount available to be drawn under such Letter of
Credit multiplied by one eighth of one percent (0.125%).
(b) Pursuant to one or more separate agreements with the
Issuing Bank, Borrower shall pay to the Issuing Bank the normal and
customary fees charged by the Issuing Bank upon the establishment of
any Letter of Credit, upon any amendment or transfer of a Letter of
Credit and upon the payment of any drawing under any Letter of Credit.
2.12. Computations. To the extent permitted by applicable law, all
computations of fees and interest under this Agreement payable in respect of any
period shall be made by the Administrative Agent on the basis of a 360-day year,
in each case for the actual number of days (including the first day but
excluding the last day) occurring in the period for which such fees or interest
are payable; provided, however, that computations of interest in respect of Base
Rate Loans shall be made on the basis of a year of 365 or 366 days, as
applicable, in each case for the actual number of days (including the first day
but excluding the last day) occurring in the period for which such interest is
payable. In computing interest on any Loan, the date of the making of such Loan
or the first day of an Interest Period, as the case may be, shall be included
and the date of payment or the expiration date of an Interest Period, as the
case may be, shall be excluded; provided, however, that if a Loan is repaid on
the same day on which it is made, one day's interest shall be paid on that Loan.
2.13. Interest and Fees Margins. For purposes of interest and fee
computations hereunder involving the Applicable Base Rate Margin, the Applicable
LIBOR Margin, the Applicable Letter of Credit Fee Percentage and the Applicable
Commitment Fee Percentage, such margins and percentages shall be determined as
follows:
Applicable Applicable
Applicable Applicable Letter of Commitment
LIBOR Base Rate Credit Fee Fee
Tier Margin Margin Percentage Percentage
---- ---------- ---------- ---------- ----------
1 1.50% 0.00% 1.50% 0.300%
2 1.75% 0.25% 1.75% 0.375%
3 2.00% 0.50% 2.00% 0.375%
4 2.25% 0.75% 2.25% 0.500%
5 2.75% 1.25% 2.75% 0.500%
Except as expressly hereinafter provided, the applicable tier at any
time shall be determined with reference to the Borrower's Leverage Ratio as
follows:
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Tier Leverage Ratio
---- --------------
1 Less than 1.00 to 1.00
2 Equal to or greater than 1.00 to 1.00 but less than 1.50 to 1.00
3 Equal to or greater than 1.50 to 1.00 but less than 2.00 to 1.00
4 Equal to or greater than 2.00 to 1.00 but less than 2.50 to 1.00
5 Equal to or greater than 2.50 to 1.00
From the date hereof to but not including the first Pricing Tier
Determination Date subsequent to September 30, 2000, Tier 4 shall be applicable.
Any adjustment in the margins set forth above shall take effect on the first
Pricing Tier Determination Date following the Fiscal Quarter as to which such
ratio was calculated.
2.14. Special Provisions Governing LIBOR Loans. Notwithstanding
other provisions of this Agreement, the following provisions shall govern with
respect to LIBOR Loans as to the matters covered:
2.14.1. Determination of Interest Period. By giving a Notice
of Borrowing pursuant to Section 2.2.4, the Borrower shall have the option,
subject to the other provisions of this Section 2.14.1, to specify whether the
Interest Period commencing on the date specified therein shall be a one, two,
three, six or twelve month period; provided that:
(a) in the case of immediately successive Interest
Periods, each successive Interest Period shall commence on the day on
which the next preceding Interest Period expires;
(b) if any Interest Period otherwise would expire on a
day that is not a Business Day, that Interest Period shall be extended
to expire on the next succeeding Business Day; provided, however, that
if any such Interest Period would otherwise expire on a day that is not
a Business Day but is a day of the month after which no further
Business Day occurs in that month, that Interest Period shall expire on
the immediately preceding Business Day;
(c) any Interest Period that begins on the last Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall, subject to paragraph (d) below, end on the last Business
Day of a calendar month; and
(d) no Interest Period shall extend beyond the Maturity
Date.
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2.14.2. Determination of Interest Rate. As soon as is
practicable after 12:00 noon (Eastern time) on the Interest Rate Determination
Date, the Administrative Agent shall determine (which determination shall,
absent manifest error, be final, conclusive and binding upon all parties) the
interest rate that shall apply to the LIBOR Loans for which an interest rate is
then being determined for the applicable Interest Period and shall promptly give
notice thereof (in writing or by telephone confirmed in writing) to the Borrower
and to each Lender.
2.14.3. Inability to Determine Rate. In the event the
Administrative Agent shall have determined (which determination shall be
conclusive and binding absent manifest error) that by reason of circumstances
affecting the London interbank Eurodollar market, adequate and reasonable means
do not exist for ascertaining Base LIBOR, the Administrative Agent forthwith
shall give telephonic notice of such determination, confirmed in writing, to the
Borrower and to each Lender. If such notice is given, and until such notice has
been withdrawn by the Administrative Agent, no additional LIBOR Loans shall be
made.
2.14.4. Illegality; Termination of Commitment to Make LIBOR
Loans. Notwithstanding any other provisions of this Agreement, if any law,
treaty, rule or regulation or determination of a court or other governmental
authority, or any change therein or in the interpretation or application
thereof, shall make it unlawful for any Lender to make or maintain LIBOR Loans,
as contemplated by this Agreement, then, and in any such event, such Lender
shall be an "Affected Lender" and shall promptly give notice (by telephone
confirmed in writing) to the Borrower and the Administrative Agent (which notice
the Administrative Agent shall promptly transmit to each Lender in writing, or
by telephone confirmed in writing) of such determination, and the obligation of
the Affected Lender to make LIBOR Loans shall be terminated, and its obligation
to maintain its LIBOR Loans during such period shall be terminated at the
earlier to occur of the termination of the last Interest Period then in effect
or when required by law. Thereafter, and until such notice has been withdrawn by
the Affected Lender, the Affected Lender shall have no obligation to make LIBOR
Loans, and any LIBOR Loans of the Affected Lender then outstanding shall be
converted into Base Rate Loans as of the end of the corresponding Interest
Period for each.
2.14.5. LIBOR Loans After Default. Unless all Lenders shall
otherwise agree, after the occurrence of and during the continuance of a Default
or an Event of Default, the Borrower may not elect to have a Loan be made or
continued as, or converted to, a LIBOR Loan.
2.15. Expenses. The Borrower shall reimburse the Administrative
Agent, on demand, for all reasonable attorneys' and paralegals' fees and
expenses of counsel to the Administrative Agent, all fees and expenses for
title, lien and other public records searches, all filing and recordation fees
and taxes, all duplicating expenses, corporation search fees, appraisal fees and
escrow agent fees and expenses and all other customary fees and expenses
incurred in connection with (a) the negotiation, documentation and closing of
the transactions contemplated hereby, (b) the perfection of or the continued
perfection of the security interests contemplated hereby, and (c) the review and
preparation of any documentation in connection with, and the approval by the
Lenders of any matter for which the Lenders' approval is requested or required
hereunder.
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The obligations described in this Section 2.15 regarding the payment of expenses
are independent of all other obligations of the Borrower hereunder, shall
survive the expiration or termination of the Commitments and shall be payable
regardless of whether the financing transactions contemplated by this Agreement
shall be consummated.
2.16. Replacement or Removal of a Lender. If the Administrative
Agent receives a notice pursuant to Section 3.4.7 claiming compensation,
reimbursement or indemnity pursuant to Section 3.4 or Section 3.5, and the
aggregate amount of all such compensation, reimbursement or indemnity payments
made or required to be made by the Borrower pursuant to Section 3.4 or Section
3.5 to the Lender giving notice is materially greater (as determined by the
Borrower in its reasonable judgment) than the weighted average amount of
payments made or required to be made to the other Lenders pursuant to Section
3.4 or Section 3.5, or if the Administrative Agent receives a notice from an
Affected Lender pursuant to Section 2.14.4, then, so long as no Default shall
have occurred and be continuing, the Borrower may, within sixty (60) days after
receipt of any such notice, elect to terminate such Lender as a party to this
Agreement. If the amount of such Lender's Commitment, together with the amount
of any other Commitments theretofore or concurrently therewith to be reduced in
accordance with this Section 2.16, aggregates twenty-five percent (25%) or less
of the aggregate Commitments, the Borrower may elect either to replace such
Lender with another financial institution reasonably satisfactory to the
Administrative Agent and the Issuing Bank (a "Replacement Lender") or to reduce
the Commitments by the amount of the Commitment of such Lender. If the amount of
such Lender's Commitment, together with the amount of any other Commitments
theretofore or concurrently therewith to be reduced in accordance with this
Section 2.16, aggregates in excess of twenty-five percent (25%) of the aggregate
Commitments, the Borrower may elect to terminate such Lender only if, together
with its notice of termination, it provides to the Administrative Agent a
commitment from a Replacement Lender to replace the Commitment of the terminated
Lender on the terms and conditions set forth herein. The Borrower's election to
terminate a Lender under this Section 2.16 shall be set forth in a written
notice from the Borrower to the Administrative Agent (with a copy to such
Lender), setting forth (a) the basis for termination of such Lender, (b) whether
the Borrower intends to replace such Lender with a Replacement Lender or, if the
Borrower is not required to replace such Lender, to reduce the Commitments by
the amount of the Commitment of such Lender, and (c) the date (not later than
thirty [30] days after the date of such notice) when such termination shall
become effective. On the date on which such termination becomes effective, (i)
the Borrower or the Replacement Lender, as applicable, shall pay the terminated
Lender an amount equal to all principal, interest, fees and other amounts owed
to such Lender pursuant to this Agreement (including any amounts owed under
Sections 3.4 and 3.5) through such date, and (ii) there shall have been received
by the Administrative Agent an executed Assignment and Acceptance and all other
documents and supporting materials necessary, in the reasonable judgment of the
Administrative Agent, to evidence the substitution of the Replacement Lender for
such terminated Lender, or if there is no Replacement Lender, to reflect the
adjustment of the Commitments, including any necessary or appropriate
adjustments to the Lenders' Percentages (adjustments to the Commitments and
Percentages of the remaining Lenders to be based upon the relative proportions
of their respective Percentages).
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ARTICLE 3
PAYMENTS, PREPAYMENTS AND COMPUTATIONS
3.1. General Provisions Relating to Repayment of Loans. The Loans
shall be repaid as provided in this Section 3.1.
3.1.1. Interest Payments. The interest accrued on each Loan
shall be payable on each Interest Payment Date applicable to such Loan, upon any
prepayment of any LIBOR Loan (to the extent accrued on the amount being prepaid)
and at maturity.
3.1.2. Optional Principal Prepayments.
(a) The Borrower may prepay Swing Line Loans, in whole or
in part, at any time and from time to time. Except to the extent that
repayment of Swing Line Loans is being administered through an
automated cash management system mutually approved in writing by the
Borrower and the Swing Line Lender, the Borrower shall, prior to or
contemporaneously with making any such prepayment, give the Swing Line
Lender such notice of prepayment as is sufficient to enable the Swing
Line Lender to apply such prepayment properly to the repayment of Swing
Line Loans.
(b) The Borrower may, upon not less than one (1) Business
Day's prior written or telephonic notice confirmed in writing to the
Administrative Agent (in the case of Base Rate Loans), and upon not
less than three (3) Business Days' prior written or telephonic notice
confirmed in writing to the Administrative Agent (in the case of LIBOR
Loans) (each of which notices the Administrative Agent will promptly
transmit to each Lender in writing, or by telephone confirmed in
writing), at any time and from time to time prepay any Borrowing of
Revolving Loans (as the Borrower may specify to the Administrative
Agent) in whole or in part in a minimum amount of $500,000 and integral
multiples of $100,000 in excess of that minimum amount; provided,
however, that LIBOR Loans may be prepaid in part only if, after such
prepayment, the unpaid portion of such Loans shall have aggregate
minimum balances of $500,000; and provided further that in connection
with any prepayment of LIBOR Loans, the Borrower shall pay to the
Administrative Agent, for distribution to the Lenders, the accrued
interest on such Loan required to be paid pursuant to Section 3.1.1 and
any amounts required to be paid pursuant to Section 3.4.5.
3.1.3. Mandatory Principal Prepayments - General
Requirement. The Borrower shall prepay Loans to the extent necessary so that the
aggregate principal amount of Loans and Letter of Credit Liabilities outstanding
at any time does not exceed the Commitments then in effect; provided, however,
that in connection with any prepayment of LIBOR Loans, the Borrower shall pay to
the Administrative Agent, for distribution to the Lenders, the accrued
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interest on such Loan required to be paid pursuant to Section 3.1.1 and any
amounts required to be paid pursuant to Section 3.4.5. Any prepayment pursuant
to this Section 3.1.3 shall be applied first to Swing Line Loans until the same
have been fully repaid, then to Base Rate Loans until the same have been fully
repaid, and then to LIBOR Loans.
3.1.4. Mandatory Principal Prepayments Using Net Proceeds.
(a) On or before the date on which any Net Proceeds are
received from any source, the Borrower shall deliver to the
Administrative Agent a certificate of a Responsible Officer of the
Borrower that identifies the recipient(s) of such Net Proceeds,
describes the transaction or event that is the source of such Net
Proceeds and sets forth a calculation of the amount of such Net
Proceeds.
(b) If the Borrower or any Guarantor shall receive any
Net Proceeds in connection with any Asset Disposition or as a result of
or in connection with the offering or sale of any equity securities (or
any securities convertible into equity securities) issued by such
Person or the incurrence of any Indebtedness by such Person, then on
the Business Day following the date of receipt of such Net Proceeds the
Borrower or such Guarantor, as the case may be, shall prepay Loans by
an amount equal to the amount of such Net Proceeds.
(c) The provisions of the preceding subsections (a) and
(b) shall not apply to:
(1) the issuance of any equity securities (or
any securities convertible into equity securities) by any
Guarantor to any other Guarantor or the Borrower,
(2) the incurrence of any Indebtedness described
in subsections (b), (c), (e), (h), (i), (j) or (k) of Section
9.1,
(3) the issuance of any equity securities (or
any securities convertible into equity securities) by the
Borrower as a part of the consideration for a Permitted
Acquisition, or
(4) sales of inventory in the ordinary course of
business.
(d) Any prepayment pursuant to this Section 3.1.4 shall
be applied first to Swing Line Loans until the same have been fully
repaid, then to Base Rate Loans until the same have been fully repaid,
and then to LIBOR Loans.
3.1.5. Final Maturity of Loans. In all events, the entire
aggregate principal balances of, all accrued and unpaid interest on and all fees
and other sums due and payable in respect of the Loans shall be due and payable
in full on the Maturity Date if not sooner paid.
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3.2. Repayment of Amounts Drawn Under Letters of Credit. On each
day the Issuing Bank honors a drawing under a Letter of Credit, the Borrower
shall, after the Issuing Bank has honored such drawing, immediately reimburse
the Issuing Bank for the account of the Lenders, by 12:00 noon (Eastern time)
(or as soon thereafter as the drawing has been honored) in an amount equal to
the amount of such drawing.
3.3. Payments and Computations, Etc.
3.3.1. Time and Manner of Payments. Except as otherwise
expressly set forth herein, all payments of principal, interest and fees
hereunder and under the Notes shall be in lawful currency of the United States
of America, in immediately available (same day) funds, and delivered to the
Administrative Agent at its Lending Office for its account, the account of the
Lenders, the account of the Swing Line Lender or the account of the Issuing
Bank, as the case may be (or in the case of Swing Line Loans and if so directed
by the Swing Line Lender, delivered directly to the Swing Line Lender), not
later than 12:00 noon (Eastern time) on the date due. As soon as is practicable
thereafter, the Administrative Agent shall cause to be distributed like funds
relating to the payment of principal or interest or fees ratably to the Lenders
in accordance with their respective Percentages (other than amounts payable
pursuant to Sections 2.11.1, 3.4 and 3.5, which are to be distributed other than
ratably). Funds received by the Administrative Agent after the time specified in
the first sentence of this paragraph shall be deemed to have been paid by the
Borrower on the next succeeding Business Day.
3.3.2. Payments on Non-Business Days. Whenever any payment
to be made hereunder or under the Notes shall be stated to be due on a day that
is not a Business Day, the payment shall be made on the next succeeding Business
Day and such extension of time shall be included in the computation of the
payment of interest hereunder or under the Notes or of the fees payable
hereunder, as the case may be; provided, however, that in the event that the day
on which payment relating to a LIBOR Loan is due is not a Business Day but is a
day of the month after which no further Business Day occurs in that month, then
the due date thereof shall be the next preceding Business Day.
3.3.3. Apportionment of Payments. Aggregated principal and
interest payments shall be apportioned among all outstanding Revolving Loans to
which such payments relate, and shall be apportioned ratably among the Lenders
in proportion to the Lenders' respective Percentages of the corresponding
Revolving Loans. The Administrative Agent shall promptly distribute to each
Lender at its Lending Office its Percentage of all such payments received by the
Administrative Agent. Notwithstanding the foregoing provisions of this Section
3.3.3, if, pursuant to the provisions of Section 2.14.4, any Notice of Borrowing
is withdrawn as to any Affected Lender or if any Affected Lender makes Base Rate
Loans in lieu of its Percentage of LIBOR Loans, the Administrative Agent shall
give effect thereto in apportioning payments received thereafter.
3.3.4. Assumption of Payments Made. Unless the
Administrative Agent shall have received notice from the Borrower prior to the
date on which any payment is due to the
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Administrative Agent for the benefit of the Lenders hereunder that the Borrower
will not make such payment in full, the Administrative Agent may assume that the
Borrower has made such payment in full to the Administrative Agent on such date
and the Administrative Agent may, in reliance upon such assumption, cause to be
distributed to each Lender on such due date an amount equal to the amount then
due such Lender. If and to the extent the Borrower shall not have so made such
payment in full to the Administrative Agent, each Lender shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Lender
together with interest thereon, for each day from the date such amount is
distributed to such Lender until the date such Lender repays such amount to the
Administrative Agent, at the Federal Funds Rate, but in no event to exceed the
Highest Lawful Rate.
3.3.5. Application of Proceeds. After the occurrence and
during the continuance of an Event of Default, unless otherwise set forth in
this Agreement or the other Loan Documents, all payments received by the
Administrative Agent from the enforcement of remedies under the Loan Documents
or otherwise with respect to the Obligations shall be applied (a) first, to the
payment of any fees, expenses, reimbursements or indemnities then due from the
Borrower to the Administrative Agent; (b) second, to the payment of any fees,
expenses, reimbursements or indemnities then due from the Borrower to the
Lenders, or any of them; (c) third, to the ratable payment of interest due from
the Borrower with respect to any of the Loans and fees in respect of the Letters
of Credit; (d) fourth, to the ratable payment of principal of any of the Loans
of the Borrower and all obligations of the Borrower to reimburse the Issuing
Bank and the Lenders in respect of drawings under Letters of Credit; (e) fifth,
to be held as cash collateral by the Administrative Agent for the ratable
benefit of the Lenders, as security for outstanding Letter of Credit
Liabilities, and (f) sixth, to pay all other Obligations. Amounts applied to the
interest on or principal of Loans as aforesaid shall be applied to the interest
on or principal of outstanding Swing Line Loans, if any, prior to the
application of same to Revolving Loans.
3.4. Increased Costs, Capital Requirements and Taxes.
3.4.1. Increased Costs. Except to the extent reimbursed
pursuant to other provisions of this Section 3.4, in the event that either (i)
the introduction of, or any change in, or in the interpretation of, any law or
regulation or (ii) compliance with any guideline or request from any central
bank or other Governmental Authority (regardless of whether having the force of
law):
(a) does or shall subject any Lender to any additional
income, preference, minimum or excise tax or to any additional tax of
any kind whatsoever with respect to this Agreement, the Notes, the
Letters of Credit or any of the Loans or change the basis of taxation
of payments to such Lender of principal, commitment fees, interest or
any other amount payable hereunder (except for changes in the rate of
tax on the overall gross or net income of that Lender or its foreign
branch, agency or subsidiary); or
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(b) does or shall impose, modify or hold applicable any
reserve, special deposit, compulsory loan, FDIC insurance or similar
requirement against assets held by, or deposits or other liabilities in
or for the account of, advances or loans by, or other credit extended
by, or any other acquisition of funds by, any office of such Lender
(except, with respect to LIBOR Loans, to the extent that the reserve
requirements are reflected in the definition of "LIBOR"); or
(c) does or shall impose on that Lender any other
condition;
and the result of any of the foregoing is to increase the cost to that Lender of
issuing or participating in the Letters of Credit or of making, renewing or
maintaining the Loans or the Commitments or to reduce any amount receivable
hereunder or thereunder; then, in any such case, the Borrower shall promptly pay
to such Lender, upon demand, such additional amounts as are sufficient to
compensate such Lender for any such additional cost or reduced amount received.
3.4.2. Capital Requirements - General. If either (i) the
introduction of, or any change in, or in the interpretation of, any law or
regulation or (ii) compliance with any guideline or request from any central
bank or other Governmental Authority (regardless of whether having the force of
law), affects or would affect in any way the amount of capital required or
expected to be maintained by any Lender or any corporation controlling such
Lender with the effect of reducing the rate of return on such capital to a level
below the rate that such Lender or such other corporation could have achieved
but for such introduction, change or compliance, and such Lender reasonably
determines that such reduction is based on the existence of such Lender's
Commitments hereunder and other commitments of this type, then upon demand by
such Lender, the Borrower shall further pay to such Lender from time to time as
specified by such Lender such additional amounts as are sufficient to compensate
such Lender or other corporation for such reduction.
3.4.3. Capital Requirements - Letters of Credit. If the
Issuing Bank or any Lender determines that either (i) the introduction of, or
any change in, or in the interpretation of, any law or regulation or (ii)
compliance with any guideline or request from any central bank or other
Governmental Authority (regardless of whether having the force of law), affects
or would affect in any way the amount of capital required or expected to be
maintained by the Issuing Bank or such Lender or any corporation controlling the
Issuing Bank or such Lender with the effect of reducing the rate of return on
such capital below the rate that the Issuing Bank or such Lender or such other
corporation could have achieved but for such introduction, change or compliance,
and the Issuing Bank or such Lender reasonably determines that such reduction is
based on the existence of the Letters of Credit issued hereunder and other
commitments of this type, then upon demand by the Issuing Bank or such Lender,
the Borrower shall further pay to the Issuing Bank and such Lender from time to
time as specified by the Issuing Bank and such Lender such additional amounts as
are sufficient to compensate the Issuing Bank and such Lender or other
corporation for such reduction.
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3.4.4. Increased Reserves - Letters of Credit. If either (i)
the introduction of, or any change in, or in the interpretation of, any law or
regulation or (ii) compliance with any guideline or request from any central
bank or other Governmental Authority (regardless of whether having the force of
law), shall either (a) impose, modify or deem applicable any reserve, special
deposit or similar requirement against letters of credit or similar instruments
issued by, or assets held by, or deposits in or for the account of, the Issuing
Bank or any Lender, or (b) impose on the Issuing Bank or any Lender any other
condition regarding this Agreement as it pertains to the Letters of Credit, or
any letter of credit, and the result of any event referred to in the preceding
clause (a) or (b) shall be to increase the cost to the Issuing Bank or any
Lender of issuing or maintaining any Letter of Credit or any participation
therein (which increase in cost shall be determined by the Issuing Bank's or
such Lender's, as the case may be, reasonable allocations of the aggregate of
such cost increases resulting from such event), then, upon demand by the Issuing
Bank or such Lender, as the case may be, the Borrower shall forthwith pay to the
Issuing Bank or such Lender, as the case may be, from time to time as specified
by the Issuing Bank or such Lender, as the case may be, such additional amounts
as are sufficient to compensate the Issuing Bank or such Lender, as the case may
be, for such increased cost.
3.4.5. Breakage Costs - LIBOR Loans. The Borrower shall
indemnify and hold each Lender free and harmless from all losses, liabilities
and reasonable expenses (including any loss sustained by that Lender in
connection with the re-employment of such funds), that such Lender may sustain:
(a) if for any reason (other than a default by such Lender) a Borrowing of LIBOR
Loans does not occur on a date specified therefor in a Notice of Borrowing or a
telephonic request for borrowing or a continuation of or conversion to LIBOR
Loans does not occur on a date specified therefor in a Notice of
Conversion/Continuation or in a telephonic request for conversion/continuation,
(b) if any prepayment of any of its LIBOR Loans occurs on a date that is not the
last day of an Interest Period, (c) if any prepayment of any of its LIBOR Loans
is not made on any date specified in a notice of prepayment given by the
Borrower, or (d) as a consequence of any other default by the Borrower to repay
its LIBOR Loans when required by the terms of this Agreement.
3.4.6. LIBOR Taxes. The Borrower shall indemnify and hold
each Lender free and harmless from, and shall pay, prior to the date on which
penalties attach thereto, all present and future income, stamp and other taxes,
levies or costs and charges whatsoever imposed, assessed, levied or collected on
or in respect of a Loan solely as a result of the interest rate being determined
by reference to LIBOR or the provisions of this Agreement related to LIBOR or
the recording, registration, notarization or other formalization of any thereof
or any payments of principal, interest or other amounts made on or in respect of
a Loan when the interest rate is determined by reference to LIBOR (all such
taxes, levies, costs and charges being herein collectively called "LIBOR
Taxes"); provided, however, that LIBOR Taxes shall not include: taxes imposed on
or measured by the overall gross or net income of such Lender or any foreign
branch, agency or subsidiary of such Lender by the United States of America or
any political subdivision or taxing authority thereof or therein, or taxes on or
measured by the overall gross or net income of that Lender or any foreign
branch, agency or subsidiary of that Lender by any foreign country or
subdivision thereof in which that Lender, branch, agency or subsidiary is
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doing business. The Borrower also shall indemnify and hold each Lender free and
harmless from, and shall pay such additional amounts equal to, increases in
taxes payable by that Lender described in the foregoing proviso that are
attributable to payments made by the Borrower described in the immediately
preceding sentence or this sentence. Promptly after the date on which payment of
any such LIBOR Tax is due pursuant to applicable law, the Borrower will, at the
request of such Lender, furnish to such Lender evidence, in form and substance
satisfactory to such Lender, that the Borrower has met its obligation under this
Section 3.4.6; and the Borrower will indemnify each Lender against, and
reimburse each Lender on demand for, any LIBOR Taxes payable by that Lender.
Such Lender shall provide the Borrower with appropriate receipts for any
payments or reimbursements made by the Borrower pursuant to this Section 3.4.6.
3.4.7. Notice of Increased Costs; Payment. Each Lender and
the Issuing Bank will promptly notify the Administrative Agent (with a copy to
the Borrower) of any event of which it has knowledge, occurring after the date
hereof, that entitles such Lender or the Issuing Bank to compensation,
reimbursement or indemnity pursuant to this Section 3.4 or Section 3.5, and
shall furnish to the Administrative Agent (with a copy to the Borrower) a
certificate of such Lender or the Issuing Bank claiming compensation,
reimbursement or indemnity under this Section 3.4 or Section 3.5, setting forth
in reasonable detail the additional amount or amounts to be paid to it hereunder
if not theretofore paid by the Borrower as provided in Section 3.5 (which
certificate shall be presumed correct and binding in the absence of manifest
error). In determining such amount, such Lender and the Issuing Bank may use any
reasonable averaging, attribution or allocation methods. Within fifteen (15)
days following receipt of such notice, the Borrower shall pay to the
Administrative Agent, for distribution to such Lender, or to the Issuing Bank,
as the case may be, the amount shown to be due and payable by such certificate.
3.5. Taxes.
3.5.1. Taxes Generally. Any and all payments by the Borrower
or any Guarantor hereunder or under the Notes or the other Loan Documents shall
be made free and clear of and without deduction for any and all present or
future taxes, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect to such payments (including interest, additions to tax
and penalties thereon), excluding, in the case of each Lender, the
Administrative Agent and the Issuing Bank, (i) taxes imposed on or measured by
its net income or, in the State of Tennessee, net assets, and franchise taxes
imposed on it, by the jurisdiction of such Lender's Lending Office or any
political subdivision or taxing authority thereof, and (ii) withholding taxes
that are the subject of Sections 3.5.2 through 3.5.5. If the Borrower or any
Guarantor shall be required by law to deduct any such taxes from or in respect
of any sum payable hereunder or under any Note or any other Loan Document to any
Lender or the Administrative Agent, (a) the sum payable shall be increased as
may be necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section 3.5) such
Lender or the Administrative Agent (as the case may be) shall receive an amount
equal to the sum it would have received had no such deductions been made, and
(b) the Borrower shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable law.
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If and to the extent that any Lender subsequently shall be refunded or otherwise
recover all or any part of any such deduction, it shall refund to the Borrower
the amount so recovered.
3.5.2. Withholding Tax Exemption. If any Lender is a
"foreign corporation" within the meaning of the Code, such Lender shall deliver
to the Administrative Agent the following, as applicable: (a) if such Lender
qualifies for an exemption from or a reduction of United States withholding tax
under a tax treaty, a properly completed and executed Internal Revenue Service
Form W-8 BEN, or any successor Internal Revenue Service form, before or on the
date such Lender becomes a Lender under this Agreement, (b) if and to the extent
that the circumstances described in this clause (b) are applicable, a properly
completed and executed Internal Revenue Service Form W-8 BEN, or any successor
Internal Revenue Service form, together with a certificate (1) establishing that
payments to such Lender qualify as "portfolio interest" exempt from United
States withholding tax under Code Sections 871(h) or 881(c), and (2) stating
that (A) such Lender is not a bank for purposes of Code Section 881(c)(3)(A), or
the obligation of the Borrower hereunder is not, with respect to such Lender, a
loan agreement entered into in the ordinary course of its trade or business
within the meaning of that section, (B) such Lender is not a 10% shareholder of
the Borrower within the meaning of Code Sections 871(h)(3) or 881(c)(3)(B), and
(C) such Lender is not a controlled foreign corporation that is related to the
Borrower within the meaning of Code Section 881(c)(3)(C), before or on the date
such Lender becomes a Lender under this Agreement, (c) if such Lender qualifies
for an exemption for interest paid under this Agreement from United States
withholding tax because it effectively is connected with a United States trade
or business of such Lender, a properly completed and executed Internal Revenue
Service Form W-8 ECI, or any successor Internal Revenue Service form, before or
on the date such Lender becomes a Lender under this Agreement, and (d) such
other form or forms as may be required or reasonably requested by the
Administrative Agent to establish or substantiate exemption from, or reduction
of, United States withholding tax under the Code or other laws of the United
States, including Internal Revenue Service Forms W-8 IMY and W-8 EXF. Each such
Lender agrees to notify the Administrative Agent of any change in circumstances
that would modify or render invalid any claimed exemption or reduction.
3.5.3. Withholding Taxes. If any Lender is entitled to a
reduction in the applicable withholding tax, the Administrative Agent may
withhold from any interest payment to such Lender an amount equivalent to the
applicable withholding tax after taking into account such reduction. If the
forms or other documentation required by Section 3.5.2 are not delivered to the
Administrative Agent, then the Administrative Agent may withhold from any
interest payment to any Lender not providing such forms or other documentation,
an amount equivalent to the applicable withholding tax.
3.5.4. Indemnification. If the Internal Revenue Service or
any authority of the United States or other jurisdiction asserts a claim that
the Administrative Agent did not properly withhold tax from amounts paid to or
for the account of any Lender (because the appropriate form was not delivered or
was not properly executed, or because such Lender failed to notify the
Administrative Agent of a change in circumstances that rendered the exemption
from or
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reduction of withholding tax ineffective, or for any other reason) such Lender
shall indemnify the Administrative Agent fully for all amounts paid, directly or
indirectly, by the Administrative Agent as tax or otherwise, including penalties
and interest, together with all expenses incurred, including legal expenses,
allocated staff costs, and any out-of-pocket expenses.
3.5.5. Subsequent Lenders. If any Lender sells, assigns,
grants participations in or otherwise transfers it rights under this Agreement,
the participant shall comply and be bound by the terms of Sections 3.5.2, 3.5.3
and 3.5.4 as though it were such Lender.
3.6. Booking of Loans. Any Lender may make, carry or transfer Loans
at, to or for the account of, any of its branch or agency offices, provided,
however, that in the event that any Lender transfers its Loans to another branch
or agency office in a transaction that does not involve the transfer by such
Lender of any of its other loans to such branch or agency office, such Lender
shall not be entitled to reimbursement for additional costs or taxes with
respect to such Loans pursuant to Section 3.4 or Section 3.5 if the Borrower
would be subject to additional liability under Section 3.4 or Section 3.5 to
which it would not be subject if such Lender's Loans were maintained at the
office at which such Loans were carried prior to such transfer.
The Borrower acknowledges and agrees that (a) each Lender's method of
funding its Loans hereunder shall be in the sole discretion of such Lender, so
long as such funding complies with all applicable requirements of this
Agreement, and (b) for purposes of any determination to be made pursuant to
Sections 2.14.4 or 3.4.5 of this Agreement, each Lender shall be presumed
conclusively to have funded its LIBOR Loans with the proceeds of Dollar deposits
obtained by such Lender in the interbank Eurodollar market.
ARTICLE 4
SECURITY
4.1. Initial Security. The Obligations of the Borrower shall be
secured by:
(a) the Security Agreement;
(b) the Pledge Agreement;
(c) the Assignment and Security Agreement; and
(d) the security interest in the Collateral Account
herein granted in favor of the Administrative Agent for the ratable
benefit of the Lenders, and the other Liens provided in this Agreement
and the other Security Documents.
4.2. Further Assurances. The Borrower and the Guarantors shall, and
shall cause each of their respective Subsidiaries to, at their sole cost and
expense, execute and deliver to the Administrative Agent, the Lenders and the
Issuing Bank all such further documents, instruments
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and agreements and perform all such other acts that reasonably may be required
in the opinion of the Administrative Agent to enable the Administrative Agent,
the Lenders and the Issuing Bank to exercise and enforce their respective rights
as the secured parties under the Security Documents and to carry out the
provisions or effectuate the purposes of this Agreement and the other Loan
Documents. To the extent permitted by applicable law, the Borrower and the
Guarantors hereby authorize the Administrative Agent on behalf of itself, the
Lenders and the Issuing Bank to file Financing Statements and continuation
statements with respect to the security interests granted or assigned under the
Security Documents and to execute such Financing Statements and continuation
statements on behalf of the Borrower, the Guarantors and their respective
Subsidiaries. The Administrative Agent shall furnish to the Borrower and the
Guarantors copies of all such Financing Statements and continuation statements
filed by the Administrative Agent on behalf of the Lenders pursuant to this
Section 4.2.
ARTICLE 5
GUARANTY
5.1. Guaranty. Each of the Guarantors hereby unconditionally and
irrevocably, jointly and severally, guarantees to the Administrative Agent, the
Lenders and the Issuing Bank the due and punctual payment and performance of all
of the Obligations (except to the extent such Guarantor is a Principal Obligor
on such Obligations), in each case as and when the same shall become due and
payable, whether at maturity, by acceleration, mandatory prepayment or
otherwise, according to their terms. In case of failure by a Principal Obligor
of any Obligation punctually to pay or perform such Obligation, each of the
Guarantors (other than a Principal Obligor on such Obligation) hereby
unconditionally and irrevocably agrees to cause such payment to be made
punctually as and when the same shall become due and payable, whether at
maturity, by prepayment, declaration or otherwise, and to cause such performance
to be rendered punctually as and when due, in the same manner as if such payment
or performance were made by such Principal Obligor. This guaranty is and shall
be a guaranty of payment and performance and not merely of collection.
5.2. Maximum Guaranty Liability,
(a) Each Guarantor's respective obligations hereunder and
under the other Loan Documents shall be in an amount equal to, but not
in excess of, the maximum liability permitted under Applicable
Bankruptcy Law (the "Maximum Guaranty Liability"). To that end, but
only to the extent such obligations otherwise would be subject to
avoidance under Applicable Bankruptcy Law if any Guarantor is deemed
not to have received valuable consideration, fair value or reasonably
equivalent value for its obligations hereunder or under the other Loan
Documents, each such Guarantor's respective obligations hereunder and
under the other Loan Documents shall be reduced to that amount which,
after giving effect thereto, would not render such Guarantor insolvent,
or leave such Guarantor with an unreasonably small capital to conduct
its
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business, or cause such Guarantor to have incurred debts (or to be
deemed to have intended to incur debts), beyond its ability to pay such
debts as they mature, at the time such obligations are deemed to have
been incurred under Applicable Bankruptcy Law. As used herein, the
terms "insolvent" and "unreasonably small capital" shall likewise be
determined in accordance with Applicable Bankruptcy Law. This Section
5.2 is intended solely to preserve the rights of the Lenders, the
Administrative Agent and the Issuing Bank hereunder and under the other
Loan Documents to the maximum extent permitted by Applicable Bankruptcy
Law, and neither the Guarantors nor any other Person shall have any
right or claim under this Section 5.2 that otherwise would not be
available under Applicable Bankruptcy Law.
(b) Each Guarantor agrees that the Guaranteed Obligations
at any time and from time to time may exceed the Maximum Guaranty
Liability of such Guarantor, and may exceed the aggregate Maximum
Guaranty Liability of all Guarantors hereunder, without impairing this
Guaranty or affecting the rights and remedies of the Lenders, the
Administrative Agent or the Issuing Bank hereunder.
5.3. Contribution. In the event any Guarantor (a "Funding
Guarantor") shall make any payment or payments under this Guaranty or shall
suffer any loss as a result of any realization upon any of its property granted
as Collateral under any Loan Document, each other Guarantor (each, a
"Contributing Guarantor") shall contribute to such Funding Guarantor an amount
equal to such Contributing Guarantor's "Pro Rata Share" of such payment or
payments made, or losses suffered, by such Funding Guarantor. For the purposes
hereof, each Contributing Guarantor's Pro Rata Share with respect to any such
payment or loss by a Funding Guarantor shall be determined as of the date on
which such payment or loss was made by reference to the ratio of (a) such
Contributing Guarantor's Maximum Guaranty Liability as of such date (without
giving effect to any right to receive, or obligation to make, any contribution
hereunder) to (b) the aggregate Maximum Guaranty Liability of all Guarantors
(including such Funding Guarantor) as of such date (without giving effect to any
right to receive, or obligation to make, any contribution hereunder). Nothing in
this Section 5.3 shall affect each Guarantor's several liability for the entire
amount of the Guaranteed Obligations (up to such Guarantor's Maximum Guaranty
Liability). Each Guarantor covenants and agrees that its right to receive any
contribution hereunder from a Contributing Guarantor shall be subordinate and
junior in right of payment to all the Guaranteed Obligations.
5.4. Guaranty Unconditional. The obligations of each Guarantor
under this Article 5 shall be continuing, unconditional and absolute and,
without limiting the generality of the foregoing, shall not be released,
discharged or otherwise affected by:
(a) any extension, renewal, settlement, compromise,
waiver or release in respect of any Obligation of the Borrower under
this Agreement or any other Loan Document, by operation of law or
otherwise;
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(b) any modification or amendment or supplement to this
Agreement or any other Loan Document;
(c) any modification, amendment, waiver, release,
non-perfection or invalidity of any direct or indirect security, or of
any guaranty or other liability of any third party, for any Obligation
of the Borrower under this Agreement or any other Loan Document;
(d) any change in the existence, structure or ownership
of the Borrower or any Guarantor, or any insolvency, bankruptcy,
reorganization or other similar case or proceeding affecting the
Borrower or any Guarantor or any of their respective assets, or any
resulting release or discharge of any Obligation of the Borrower under
this Agreement or any other Loan Document;
(e) the existence of any claim, set-off or other right
that any Guarantor at any time may have against the Borrower, the
Administrative Agent, the Issuing Bank, any Lender or any other Person,
regardless of whether arising in connection with this Agreement or any
other Loan Document;
(f) any invalidity or unenforceability relating to or
against the Borrower for any reason of the whole or any provision of
this Agreement or any other Loan Document, or any provision of
Applicable Bankruptcy Law purporting to prohibit the payment or
performance by the Borrower of any Obligation or the payment by the
Borrower of any other amount payable by it under this Agreement or any
other Loan Document; or
(g) any other act or omission to act or delay of any kind
by the Borrower, the Administrative Agent, the Issuing Bank, any Lender
or any other Person or any other circumstance whatsoever that might but
for the provisions of this Section 5.4 constitute a legal or equitable
discharge of the obligations of any Guarantor under this Article 5.
5.5. Discharge Only Upon Payment in Full; Reinstatement in Certain
Circumstances. Each Guarantor's obligations under this Article 5 shall remain in
full force and effect so long as any Obligations are unpaid or outstanding, any
Obligation under the Loan Documents is not performed or any of the Commitments
are in effect. If at any time any payment of the Obligations or any other amount
payable by the Borrower under this Agreement or the other Loan Documents is
rescinded or otherwise must be restored or returned upon the insolvency,
bankruptcy or reorganization of the Borrower or otherwise, each Guarantor's
obligations under this Article 5 with respect to such payment shall be
reinstated at such time as though such payment had become due but not been made
at such time.
5.6. Waiver. Each Guarantor irrevocably waives acceptance hereof,
presentment, demand, protest, notice of any breach or default by the Borrower
and any other notice not specifically provided for herein, as well as any
requirement that at any time any action be taken by any Person against the
Borrower or any other Person or any Collateral granted as security for
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the Obligations or the Guaranteed Obligations. Each Guarantor hereby
specifically waives any right to require that an action be brought against the
Borrower or any other Principal Obligor with respect to the Obligations under
the provisions of Title 47, Chapter 12, Tennessee Code Annotated, as the same
may be amended from time to time.
5.7. Waiver of Reimbursement, Subrogation, Etc. So long as any
Obligations are unpaid or outstanding, any Obligation under the Loan Documents
is unperformed or any of the Commitments are in effect, each Guarantor hereby
waives and agrees not to assert, to the fullest extent possible as against the
Borrower and its assets, any and all rights, whether at law, in equity, by
agreement or otherwise, to subrogation, indemnity, reimbursement, contribution,
exoneration or any other similar claim, right, cause of action or remedy that
otherwise would arise out of such Guarantor's performance of its obligations to
the Administrative Agent, any Lender or the Issuing Bank under this Article 5.
The preceding waiver is intended by the Guarantors, the Administrative Agent,
the Issuing Bank and the Lenders to be for the benefit of the Borrower or any of
its successors and permitted assigns as an absolute defense to any action by any
Guarantor against the Borrower or its assets that arises out of such Guarantor's
having made any payment to the Administrative Agent, the Issuing Bank or any
Lender with respect to any of the Guaranteed Obligations.
5.8. Stay of Acceleration. If acceleration of the time for payment
of any amount payable by the Borrower under this Agreement is stayed upon the
insolvency, bankruptcy or reorganization of the Borrower, all such amounts
otherwise subject to acceleration under the terms of this Agreement shall
nonetheless be payable by the Guarantors hereunder forthwith on demand by the
Administrative Agent as directed by Requisite Lenders.
5.9. Subordination of Indebtedness. Any indebtedness of the
Borrower for borrowed money now or hereafter owed to any Guarantor is hereby
subordinated in right of payment to the payment by the Borrower of the
Obligations, and if a default in the payment of the Obligations shall have
occurred and be continuing, any such indebtedness of the Borrower owed to any
Guarantor, if collected or received by such Guarantor, shall be held in trust by
such Guarantor for the holders of the Obligations and be paid over to the
Administrative Agent for application in accordance with this Agreement and the
other Loan Documents.
5.10. Certain Releases. In the event that any asset sale permitted
under subsection 9.3(d) consists in whole or in part of the sale of all of the
capital stock of (or other ownership interests in) a Subsidiary that is owned by
the Borrower or any other Subsidiary of the Borrower, upon the request of the
Borrower, the Administrative Agent shall release the Subsidiary whose stock (or
other ownership interests) has (have) been sold from any duties and obligations
to the Lenders pursuant to this Agreement and the other Loan Documents to which
such Subsidiary may be a party; provided that (a) at the times of such request
and release any Indebtedness evidenced by a Pledged Note made by such Subsidiary
has been fully satisfied, and (b) no Default has occurred and is continuing or
would result from such releases.
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ARTICLE 6
CONDITIONS PRECEDENT
6.1. Conditions Precedent to Initial Loans and Letters of Credit.
The effectiveness of this Agreement, the obligations of the Issuing Bank to
issue Letters of Credit, the obligations of the Lenders to purchase
participations in Letters of Credit and the obligations of the Lenders to make
the Loans are all subject to the satisfaction by the Borrower and the
Guarantors, to the extent not waived by the Lenders, of the following
conditions precedent, except to the extent that any of such conditions are to
be satisfied after the date hereof pursuant to Section 8.19:
6.1.1. Deliveries to the Administrative Agent. The
Administrative Agent shall have received, for the ratable benefit of each
Lender (and in such number of original counterparts or copies as the
Administrative Agent reasonably may specify), each of the following, in form
and substance satisfactory to the Administrative Agent, the Lenders, the
Issuing Bank and their respective counsel:
(a) Agreement. Counterpart originals of this Agreement,
each duly and validly executed and delivered by or on behalf of all
the appropriate parties thereto;
(b) Notes. The Notes, each duly and validly executed and
delivered on behalf of the Borrower;
(c) Security Documents. The Security Agreement, the
Pledge Agreement, the Assignment and Security Agreement and all of the
other Security Documents, each duly and validly executed and delivered
by or on behalf of all the appropriate parties thereto, together with
(i) acknowledgment copies of the financing statements duly filed under
the UCC of all jurisdictions necessary or, in the opinion of the
Administrative Agent, desirable to perfect the security interests
created by such Security Documents, and (ii) evidence of the public
recordation or filing of such of the Security Documents as the
Administrative Agent deems it necessary or desirable to record or file
publicly, in such offices as the Administrative Agent shall require;
(d) Pledged Stock. Certificates evidencing the Pledged
Stock, together with an appropriate stock power for each certificate,
duly executed in blank by the Borrower or the appropriate Guarantor,
as the case may be;
(e) Pledged Notes. The Pledged Notes, together with
appropriate instruments of assignment attached thereto, duly endorsed
in blank by the Borrower or the appropriate Guarantor, as the case may
be;
(f) Perfected Security Interest. Evidence of Lien
searches, through a date satisfactory to the Administrative Agent,
showing no Liens affecting the Collateral other
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than Liens in favor of the Administrative Agent for the ratable
benefit of the Lenders in connection herewith;
(g) Organizational Documents. Copies of the charters,
articles or certificates of incorporation or other organizational
documents of the Borrower and each of its Subsidiaries, certified by
the Secretary of State or other appropriate public official in each
jurisdiction of organization, all in form and substance satisfactory
to the Lenders;
(h) Bylaws. Copies of the bylaws, and all amendments
thereto, of the Borrower and each of its Subsidiaries, together with
certificates of the respective Secretaries or Assistant Secretaries of
the Borrower and each of such Subsidiaries, dated the date hereof,
stating that such copy is complete and correct;
(i) Good Standing and Authority. Certificates of the
appropriate governmental officials of each jurisdiction as the
Administrative Agent reasonably may request, dated within thirty (30)
days of the date hereof, stating that the Borrower and each of its
Subsidiaries exists, is in good standing with respect to the payment
of franchise and similar taxes and is duly qualified to transact
business therein;
(j) Incumbency. Certificates of the respective
Secretaries or Assistant Secretaries of the Borrower and each of the
Guarantors, dated the date hereof, as to the incumbency and signature
of all officers of the Borrower or such Guarantor authorized to
execute or attest to this Agreement, the Notes and the other Loan
Documents to which the Borrower or each such Guarantor is a party,
together with evidence of the incumbency of each such Secretary or
Assistant Secretary;
(k) Resolutions. With respect to the Borrower and each
of the Guarantors (i) copies of the resolutions authorizing, approving
and ratifying this Agreement, the Notes, the Security Documents and
the other Loan Documents and the transactions contemplated herein and
therein, duly adopted by the respective boards of directors or other
managers of the Borrower and each of the Guarantors, together with
(ii) certificates of the respective Secretaries or Assistant
Secretaries of the Borrower and each of the Guarantors, dated the date
hereof, stating that each such copy is a true and correct copy of
resolutions duly adopted at a meeting, or by action taken on written
consent, of the board of directors or other managers of the Borrower
or such Guarantor and that such resolutions have not been modified,
amended, rescinded or revoked in any respect and are in full force and
effect as of the date hereof;
(l) Legal Opinions of the Borrower's and Guarantors'
Counsel. The favorable legal opinions of (i) King & Spalding, counsel
to the Borrower and the Guarantors, (ii) Broad & ▇▇▇▇▇▇, special
Florida counsel to the Borrower and the Guarantors, (iii) Johnson,
Smith, ▇▇▇▇▇ & Heath, LLP, special Indiana counsel to the Borrower and
the Guarantors, and (iv) Schwartz, Tobia, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇, special New Jersey counsel to the Borrower and the Guarantors,
each dated the date
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hereof and addressed to the Administrative Agent, the Lenders and the
Issuing Bank, substantially in the forms attached hereto as collective
Exhibit 6.1.1A;
(m) Evidence of Indebtedness. If requested by the
Administrative Agent, (i) a copy of each indenture, loan agreement,
guaranty, promissory note or other evidence of Indebtedness other than
Contingent Obligations, Indebtedness incurred under the Loan
Documents, trade debt incurred in the ordinary course of business and
obligations under Operating Leases (together with all modifications,
amendments, restatements or supplements thereto) to which the
Borrower, the Guarantors or their respective Subsidiaries are parties
constituting a liability (contingent or otherwise) equal to or in
excess of $1,000,000, the terms and conditions of which shall be
satisfactory to the Administrative Agent, and (ii) a report certified
by a Responsible Officer of the Borrower and of each of the Guarantors
describing any default or failure of performance or any event that
with the giving of notice of, or the lapse of time, or both, would
become a default by the Borrower, the Guarantors or any of their
respective Subsidiaries under any of such documents, instruments or
agreements;
(n) Annual Financial Statements. The consolidated
balance sheets of the Borrower and its Subsidiaries as of December 31,
1997, December 31, 1998 and December 31, 1999, and the related
consolidated statements of income, shareholder's equity and cash flows
for each of the respective Fiscal Years then ended, audited and
reported upon, without qualification, by Ernst & Young LLP, together
with an unaudited consolidating balance sheet of the Borrower and its
Subsidiaries as of the end of each such Fiscal Year and an unaudited
consolidating statement of income for each such Fiscal Year, prepared
by such accountants and certified by a Responsible Officer of the
Borrower;
(o) March 31, 2000 Financial Statements. The unaudited
consolidated and consolidating balance sheet of the Borrower and its
Subsidiaries as of March 31, 2000, and the related consolidated and
consolidating statement of income and the related consolidated
statements of shareholder's equity and cash flows for the period
commencing at the beginning of the current Fiscal Year and ending with
the end of the Fiscal Quarter ended on such date, certified by a
Responsible Officer of the Borrower;
(p) Projections. The Projections;
(q) Officer's Certificate. A certificate of a
Responsible Officer of the Borrower and each of the Guarantors, dated
the date hereof, stating that (i) each of the representations and
warranties contained in Article 7 is true and correct at and as of the
date hereof with the same force and effect as if made on such date,
(ii) all obligations, covenants, agreements and conditions contained
in this Agreement to be performed or satisfied by the Borrower or such
Guarantor on or prior to the date hereof have been performed or
satisfied in all respects, (iii) since December 31, 1999, there has
been no Material Adverse Change, and (iv) no Default has occurred or
is continuing, and in
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addition setting forth in such detail as shall be required by the
Lenders calculations showing that as of the date hereof and after
giving effect to the transactions that are the subject hereof the
Borrower and the Guarantors are in compliance with Article 10;
(r) Solvency Certificate. A solvency certificate of a
Responsible Officer of the Borrower and each Guarantor, in
substantially the form of Exhibit 6.1.1B (the "Solvency Certificate");
(s) Consents. Evidence that the Borrower and each
Guarantor have obtained all requisite consents and approvals required
to be obtained from any Person to permit the transactions contemplated
by this Agreement, the Notes and the other Loan Documents to be
consummated in accordance with their respective terms and conditions;
and
(t) Other Matters. All other documents, instruments,
agreements, opinions, certificates, insurance policies, consents and
evidences of other legal matters, in form and substance satisfactory
to the Administrative Agent and its counsel, as the Administrative
Agent reasonably may request.
6.1.2. Compliance with Laws. The Borrower, the Guarantors
and their respective Subsidiaries shall not be in violation of, and shall not
have received notice of any violation of, any applicable Requirement of Law,
including any building, zoning, occupational safety and health, fair
employment, equal opportunity, pension, environmental control, health care,
certificate of need, health care facility licensing or similar federal, state
or local law, ordinance or regulation, relating to the ownership or operation
of its business or assets, if such violation or non-compliance could have a
Material Adverse Effect, and if requested by the Administrative Agent the
Borrower, the Guarantors or their respective Subsidiaries shall have furnished
to the Administrative Agent and the Lenders copies of all required approvals
(including required operating licenses and permits) of any Governmental
Authority.
6.1.3. No Material Adverse Change. Since December 31, 1999,
no Material Adverse Change, as reasonably determined by the Administrative
Agent, the Lenders and the Issuing Bank, shall have occurred.
6.1.4. No Material Misrepresentation. No material
misrepresentation or omission shall have been made by or on behalf of the
Borrower or any Guarantor to the Administrative Agent, the Lenders or the
Issuing Bank with respect to the Borrower's or such Guarantor's business
operations or financial or other condition.
6.1.5. Legal Proceedings. No action, suit, proceeding or
investigation shall be pending before or threatened by any court or
Governmental Authority with respect to the transactions contemplated hereby or
that may have a Material Adverse Effect (as reasonably determined by the
Administrative Agent, the Lenders and the Issuing Bank).
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6.2. Conditions Precedent to All Loans and Letters of Credit. The
obligations of each of the Lenders to make any Loans (including Loans used to
refinance or repay other Loans or Letter of Credit Liabilities) on any date
(including the date hereof), and the obligations of the Issuing Bank to issue
or extend Letters of Credit on any date (including the date hereof), are
subject to the satisfaction of the conditions set forth below in this Section
6.2. Each request for Loans or for a Letter of Credit hereunder shall
constitute a representation and warranty by the Borrower to the Administrative
Agent, each Lender and the Issuing Bank, as of the date of the making of such
Loans or the issuance of such Letter(s) of Credit, that the conditions in this
Section 6.2 have been satisfied.
6.2.1. Satisfaction of Conditions Precedent to Initial
Loans and Letters of Credit. The conditions precedent set forth in Section 6.1
shall have been satisfied.
6.2.2. Representations and Warranties. The representations
and warranties of the Borrower and the Guarantors set forth in this Agreement,
the Notes and the other Loan Documents and in any certificate, opinion or other
statement provided at any time by or on behalf of the Borrower or any Guarantor
in connection herewith shall be true and correct on and as of the date of the
making of such Loans or the issuance of such Letter(s) of Credit as if made on
and as of such date, except for such changes as are permitted by the terms of
this Agreement.
6.2.3. No Default. No Default shall have occurred and be
continuing on the date of the requested Borrowing or Letter of Credit issuance
or after giving effect to such Borrowing or Letter of Credit issuance.
6.2.4. No Violations. No law or regulation shall prohibit
the making of the requested Loan or the issuance of the requested Letter of
Credit and no order, judgment or decree of any court or Governmental Authority
shall, and no litigation shall be pending that in the judgment of the
Administrative Agent or Requisite Lenders would, enjoin, prohibit or restrain
any Lender from making a requested Loan or the Issuing Bank from issuing a
requested Letter of Credit.
6.2.5. Proceedings Satisfactory. All proceedings in
connection with the making of any Loan, the issuance of any Letter of Credit
and the other transactions contemplated by this Agreement, the Loan Documents
and all documents incidental thereto shall be reasonably satisfactory to the
Administrative Agent, and the Administrative Agent shall have received all such
information and such counterpart originals or certified or other copies of such
documents as the Administrative Agent reasonably may request.
ARTICLE 7
REPRESENTATIONS AND WARRANTIES
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In order to induce the Administrative Agent, the Lenders and the
Issuing Bank to enter into this Agreement, to make the Loans, to issue the
Letters of Credit and to provide the other financial accommodations provided
for herein, the Borrower and each of the Guarantors hereby make the following
representations and warranties to the Administrative Agent, each Lender and the
Issuing Bank:
7.1. Existence and Power. The Borrower, each of the Guarantors and
each of their respective Subsidiaries are corporations duly organized, validly
existing and in good standing under the laws of the jurisdiction indicated next
to the name of such entity on Schedule 7.1. The Borrower, each of the
Guarantors and each of their respective Subsidiaries have the power, authority
and legal right to own and operate their respective properties and assets, to
lease the properties and assets they operate under lease and to carry on their
respective businesses as they are now being conducted and intended to be
conducted, and are duly qualified to transact business in, and in good standing
under the laws of, each jurisdiction in which their ownership, lease or
operation of property or the conduct of their respective businesses requires
such qualification, except to the extent that failure to qualify to transact
business will not have a Material Adverse Effect.
7.2. Authorization and Enforceability of Obligations. The
Borrower, each of the Guarantors and each of their respective Subsidiaries (a)
have the power, authority and legal right to enter into this Agreement and such
of the Loan Documents to which each is a party and to enter into and perform
their respective obligations hereunder and thereunder, and (b) have taken all
necessary action on the part of each to authorize the execution and delivery of
such documents, instruments and agreements and the performance of their
respective obligations hereunder and thereunder. This Agreement, the Notes and
the other Loan Documents have been duly executed and delivered on behalf of the
Borrower, each of the Guarantors and such of their respective Subsidiaries as
are parties to such Loan Documents, and constitute legal, valid and binding
obligations, enforceable against the Borrower, the Guarantors and their
respective Subsidiaries as are parties hereto or thereto in accordance with
their respective terms.
7.3. No Consents. Except as set forth on Schedule 7.3, all
necessary consents, approvals and authorizations of, filings with and acts by
or with respect to all Governmental Authorities and other Persons required to
be obtained, made or taken in connection with the execution, delivery,
performance, validity or enforceability of this Agreement, the Notes and the
other Loan Documents, or otherwise in connection with the transactions
contemplated hereby, have been obtained, made or taken and remain in effect.
7.4. No Conflict. The execution and delivery of this Agreement,
the Notes and the other Loan Documents, the transactions contemplated hereby,
the use of the proceeds of the Loans and the Letters of Credit and the
performance by the Borrower, the Guarantors and their respective Subsidiaries
as are parties to the Loan Documents of their respective obligations hereunder
and thereunder (a) do not conflict with or violate any Requirement of Law or
any Contractual Obligation of the Borrower, such Guarantor or such Subsidiary,
except to the extent that any such violation or conflict will not have a
Material Adverse Effect, and (b) do not conflict
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with, constitute a default or require any consent under, or result in the
creation of any Lien upon any property or assets of the Borrower, such
Guarantor or such Subsidiary pursuant to any Contractual Obligation of the
Borrower, such Guarantor or such Subsidiary (other than Liens in favor of the
Administrative Agent, the Lenders and the Issuing Bank), except to the extent
that any such conflict or default or the failure to obtain any necessary
consent will not have a Material Adverse Effect.
7.5. Financial Statements; Projections; Solvency.
(a) The consolidated balance sheets of the Borrower and
its Subsidiaries as of December 31, 1997, December 31, 1998 and
December 31, 1999, together with the related consolidated statements
of income, shareholder's equity and cash flows for each of the
respective Fiscal Years then ended, together with the respective
opinions of Ernst & Young LLP with respect thereto, and together with
the unaudited consolidating balance sheet of the Borrower and its
Subsidiaries as of the end of each such Fiscal Year and the unaudited
consolidating statement of income for each such Fiscal Year, copies of
all of which have been furnished to the Administrative Agent, are
complete and correct and fairly present the assets, liabilities and
consolidated financial position of the Borrower and its Subsidiaries
as at each such date and the consolidated results of their operations
and their cash flows for each of the respective Fiscal Years then
ended.
(b) The unaudited consolidated and consolidating balance
sheet of the Borrower and its Subsidiaries as of March 31, 2000,
together with the related consolidated and consolidating statement of
income and the related consolidated statements of shareholders' equity
and cash flows for the period commencing at the beginning of the
current Fiscal Year and ending with the end of the Fiscal Quarter
ended on such date, copies of all of which have been furnished to the
Administrative Agent, are complete and correct and, subject to
customary year-end adjustments that are not anticipated to be
material, fairly present the assets, liabilities and consolidated
financial position of the Borrower and its Subsidiaries as at such
date and the consolidated results of their operations and their cash
flows for such period.
(c) In the opinion of the management of the Borrower,
the assumptions used in the preparation of the Projections were
reasonable when made and as of the date of such Projections. The
Projections were prepared in good faith by executive and financial
personnel of the Borrower in light of the historical financial
performance and the financial and operating condition of the Borrower
and its Subsidiaries at the time prepared and, in the opinion of the
management of the Borrower and the Guarantors, represented, as of the
date of such Projections, a reasonable estimate of the future
performance and financial condition of the Borrower and its
Subsidiaries for the periods included therein, subject to the
uncertainties and approximations inherent in the making of any
financial projections and without assurance that the projected
performance and financial condition actually will be achieved.
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(d) The financial statements described in the preceding
paragraphs (a) and (b), including the related schedules and notes
thereto, have been prepared in conformity with GAAP applied
consistently throughout the periods involved. Neither the Borrower nor
any of its Subsidiaries has any material Indebtedness, obligation or
other unusual forward or long-term commitment that is not fairly
reflected in the foregoing financial statements or in the notes
thereto.
(e) After giving effect to the consummation of the
transactions contemplated by this Agreement, the making of Loans
hereunder, the issuance of Letters of Credit hereunder, the incurrence
by the Borrower of the Obligations and the incurrence by the
Guarantors of the Guaranteed Obligations, each of the Borrower, the
Guarantors and their respective Subsidiaries is Solvent.
7.6. Absence of Litigation. Except as otherwise set forth in
Schedule 7.6 or disclosed to the Administrative Agent and the Lenders pursuant
to Section 8.3.2, there are no actions, suits, proceedings or other litigation
(including proceedings by or before any arbitrator or Governmental Authority)
pending or threatened against or affecting the Borrower, the Guarantors or any
of their respective Subsidiaries, nor to the knowledge of the Borrower and the
Guarantors is there any basis therefor, (a) that challenge the validity or
propriety of the transactions contemplated hereby, or (b) that reasonably can
be expected to be adversely determined and, if adversely determined, to have a
Material Adverse Effect, either individually or in the aggregate.
7.7. No Default. Neither the Borrower nor any Guarantor nor any of
their respective Subsidiaries is in default (nor has any event occurred that
with notice or lapse of time or both would constitute a default) under any
Contractual Obligation of the Borrower, any Guarantor or any of their
respective Subsidiaries, if such default or event could have a Material Adverse
Effect. No Default has occurred and is continuing.
7.8. Security Documents. The Security Documents create in favor of
the Administrative Agent for the benefit of the Issuing Bank and the ratable
benefit of the Lenders valid, perfected security interests in the Collateral
subject to no Liens other than Permitted Liens. The security interests granted
in favor of the Administrative Agent as contemplated by this Agreement and the
Security Documents do not constitute a fraudulent conveyance under the federal
Bankruptcy Code or any applicable state law.
7.9. Capital Stock. As of the date hereof, the capitalization of
the Borrower, the Guarantors and their respective Subsidiaries consists of such
number of shares, authorized, issued and outstanding, of such classes and
series, with or without such par value, as are set forth in Schedule 7.1. All
such outstanding shares have been duly authorized and validly issued and are
fully paid and nonassessable. As of the date hereof, there are no outstanding
stock purchase warrants, subscriptions, options, securities, instruments or
other rights of any type or nature whatsoever that are convertible into,
exchangeable for or otherwise provide for the issuance of
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capital stock of the Borrower, any Guarantor or any of their respective
Subsidiaries, except as described in Schedule 7.1.
7.10. Taxes. The Borrower, the Guarantors and their respective
Subsidiaries have filed all tax returns that were required to be filed in any
jurisdiction and have paid all taxes shown thereon to be due or otherwise due
upon the Borrower, the Guarantors, their respective Subsidiaries or their
respective properties, income or franchises, including interest, assessments,
fees and penalties, or have provided adequate reserves for the payment thereof.
To the knowledge of the Borrower and the Guarantors, no claims are threatened,
pending or being asserted with respect to, or in connection with, any return
referred to in this Section 7.10 that, if adversely determined, could have a
Material Adverse Effect.
7.11. No Burdensome Restrictions. No Contractual Obligation of the
Borrower, any Guarantor or any of their respective Subsidiaries, and no
Requirement of Law relating to or otherwise affecting the Borrower, the
Guarantors or any of their respective Subsidiaries or any of their respective
properties, businesses or operations, materially and adversely affects, or
insofar as any of them may reasonably foresee could so affect, the properties,
businesses, prospects, results of operations, management or financial or other
condition of the Borrower and its Subsidiaries, taken as a whole, or could
affect the ability of the Borrower, any Guarantor or any of their respective
Subsidiaries to perform its obligations under this Agreement, the Notes and the
other Loan Documents to which it is a party.
7.12. Judgments. There are no outstanding or unpaid judgments
against the Borrower, any of the Guarantors or any of their respective
Subsidiaries.
7.13. Subsidiaries. Each of the Subsidiaries of the Borrower and
the Guarantors as of the date hereof is set forth in Schedule 7.1. Each such
Subsidiary is wholly owned by the Borrower or a Guarantor. Schedule 7.1 also
shows as of the date hereof as to each such Subsidiary the jurisdiction of its
incorporation or formation, the number of shares of each class of capital stock
outstanding, the direct owner of the outstanding shares of each such class
owned, and the jurisdictions in which such Subsidiary is qualified to do
business as a foreign corporation.
7.14. ERISA. No "prohibited transaction" or "accumulated funding
deficiency" (each as defined in ERISA) or Reportable Event has occurred with
respect to any Single Employer Plan, or to the knowledge of Borrower and the
Guarantors with respect to any Multi-Employer Plan. As of the most recent
actuarial valuation of any such Plan, the actuarial present value of all
benefits under each Plan (based on those assumptions used to fund the Plan)
does not exceed the fair market value of the assets of the Plan allocable to
such benefits. The Borrower, the Guarantors, their respective Subsidiaries and
each Commonly Controlled Entity are in compliance in all material respects with
ERISA and the rules and regulations promulgated thereunder.
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7.15. Margin Securities. None of the Borrower, the Guarantors or
any of their respective Subsidiaries is engaged principally in, nor has as one
of its significant activities, the business of extending credit for the purpose
of purchasing or carrying "margin stock" as that term is defined in Regulation
U promulgated by the Board of Governors of the Federal Reserve System, as now
in effect. No part of the Indebtedness evidenced by the Notes, or otherwise
created in connection with this Agreement or the other Loan Documents, has been
or will be used, directly or indirectly, for the purpose of purchasing any such
margin stock. If requested by the Administrative Agent or any of the Lenders,
the Borrower shall furnish or cause to be furnished to the Administrative Agent
and each such Lender a statement, in conformity with the requirements of
Federal Reserve Form U-1 referred to in Regulation U, to the foregoing effect.
7.16. Investment Company Act. None of the Borrower, the Guarantors
or any of their respective Subsidiaries is an "investment company," or company
"controlled" by an investment company within the meaning of the Investment
Company Act of 1940, as now in effect.
7.17. Indebtedness and Contingent Obligations. Set forth on
Schedule 7.17A is a complete and correct list of all Indebtedness (other than
Contingent Obligations, Indebtedness incurred under the Loan Documents, trade
debt incurred in the ordinary course of business and obligations under
Operating Leases) of the Borrower, each Guarantor and each of their respective
Subsidiaries and the aggregate principal amount thereof outstanding on the date
hereof. Set forth on Schedule 7.17B is a complete and correct list of all
Contingent Obligations (other than any Contingent Obligations created under the
Loan Documents) of the Borrower, each Guarantor and each of their respective
Subsidiaries and the aggregate amount thereof outstanding on the date hereof.
7.18. Business Locations and Trade Names. Set forth on Schedule
7.18A is a complete and correct list of the locations where each of the
Borrower, the Guarantors and their respective Subsidiaries maintain their
respective chief executive offices, their principal places of business, an
office, a place of business or any material financial records as of the date
hereof. Set forth on Schedule 7.18B is a complete and correct list of each name
under or by which each of the Borrower, the Guarantors and their respective
Subsidiaries conducts its business as of the date hereof or has conducted its
business during the seven years preceding the date of this Agreement.
7.19. Title to Assets. The Borrower, the Guarantors and their
respective Subsidiaries have good and marketable title (or good and marketable
leasehold interests with respect to leased property) to all their respective
assets (including all assets constituting a part of the Collateral and all
assets reflected in the consolidated balance sheet as of December 31, 1999 but
excluding any assets disposed of as permitted by Section 9.3), subject to no
Liens other than Permitted Liens.
7.20. Labor Matters. There are no disputes or controversies pending
between the Borrower, the Guarantors or their respective Subsidiaries and their
respective employees, the outcome of which reasonably may be expected to have a
Material Adverse Effect.
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7.21. Business. There is no pending or threatened claim, action,
suit, proceeding or other litigation against or affecting the Borrower, the
Guarantors or their respective Subsidiaries contesting the right of the
Borrower, the Guarantors or their respective Subsidiaries to conduct their
businesses as presently conducted or as proposed to be conducted, and there are
no other facts or circumstances that have had or reasonably may be expected to
have a Material Adverse Effect.
7.22. Compliance with Laws. The Borrower and its Subsidiaries (a)
have not been, are not and will not be in violation of any applicable
Requirement of Law, including any building, zoning, occupational safety and
health, fair employment, equal opportunity, pension, environmental control,
health care, certificate of need, health care facility licensing or similar
federal, state or local law, ordinance or regulation, relating to the ownership
or operation of their respective businesses or assets, (b) have not failed to
obtain any license, permit, certificate or other governmental authorization
necessary for the conduct of their businesses or the ownership and operation of
their assets, (c) have not received any notice from any Governmental Authority,
and to their knowledge no such notice is pending or threatened, alleging that
the Borrower, any Guarantor or any of their respective Subsidiaries has
violated, or has not complied with, any Requirement of Law, condition or
standard applicable with respect to any of the foregoing, and (d) are not a
party to any agreement or instrument, or subject to any judgment, order, writ,
rule, regulation, code or ordinance, except to the extent that any violation,
noncompliance, failure, agreement, judgment, etc. as described in this Section
7.22 will not have a Material Adverse Effect.
7.23. Service Contracts. Schedule 7.23 is a true, correct and
complete listing of all Service Contracts in effect on the date of this
Agreement. Other than as set forth on Schedule 7.23, each such Service Contract
is in full force and effect in accordance with the terms thereof and there are
no material defaults under any Service Contract by the Borrower, the Guarantors
or any of their respective Subsidiaries as are parties thereto. To the
knowledge of the Borrower and the Guarantors, there is no pending or threatened
claim, action, suit, proceeding, litigation or investigation in connection with
any Service Contract involving the Borrower, any Guarantor or any of their
respective Subsidiaries. The Borrower, the Guarantors and their respective
Subsidiaries have timely filed or caused to be timely filed all reports
required to be made with respect to payment under the Service Contracts, and
all such reports are, or when filed will be, complete and accurate. Except as
may be disclosed in the financial statements referred to in Section 7.5, the
Borrower, the Guarantors and each of their respective Subsidiaries have no
liability (regardless of whether disclosed in any report heretofore or
hereafter made) under or in connection with the Service Contracts for any
refund, discount or adjustment to any Person that has not been fully reserved
for, and no interest or penalties are accruing with respect thereto, except to
the extent that the aggregate amount of all such liabilities will not have a
Material Adverse Effect.
7.24. Governmental Authorizations; Permits, Licenses and
Accreditation; Other Rights. The Borrower and its Subsidiaries have all
licenses, permits, approvals, registrations, contracts, consents, franchises,
qualifications, certificates of need, accreditations and other authorizations
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necessary for the lawful conduct of their respective businesses or operations
wherever now conducted and as planned to be conducted, pursuant to all
applicable statutes, laws, ordinances, rules and regulations of all
Governmental Authorities having, asserting or claiming jurisdiction over the
Borrower and its Subsidiaries or over any part of their respective operations.
Copies of all such licenses, permits, approvals, registrations, contracts,
consents, franchises, qualifications, certificates of need, accreditations and
other authorizations shall be provided to the Administrative Agent upon
request. The Borrower and its Subsidiaries are not in default under any of such
licenses, permits, approvals, registrations, contracts, consents, franchises,
qualifications, certificates of need, accreditations and other authorizations,
and no event has occurred, and no condition exists, that with the giving of
notice, the passage of time or both would constitute a default thereunder or
would result in the suspension, revocation, impairment, forfeiture or
non-renewal of any thereof, except to the extent that the cumulative effect of
all such defaults, events, conditions, suspensions, revocations, impairments,
forfeitures and non-renewals will not have a Material Adverse Effect. The
continuation, validity and effectiveness of all such licenses, permits,
approvals, registrations, contracts, consents, franchises, qualifications,
certificates of need, accreditations and other authorizations will not be
adversely affected by the transactions contemplated by this Agreement. The
Borrower and its Subsidiaries know of no reason why they will not be able to
maintain after the date hereof all licenses, permits, approvals, registrations,
contracts, consents, franchises, qualifications, certificates of need,
accreditations and other authorizations necessary or appropriate to conduct the
businesses of the Borrower and its Subsidiaries as now conducted and presently
planned to be conducted.
7.25. No Material Adverse Change. Since December 31, 1999 there has
been no Material Adverse Change.
7.26. Employment and Investment Agreements. Set forth on Schedule
7.26 is a complete and accurate list, as of the date hereof, of (a) all
employment agreements and executive compensation arrangements to which the
Borrower, the Guarantors or any of their respective Subsidiaries is a party and
which provide for aggregate compensation (including bonuses) to any Person
(assuming compliance with or satisfaction of all contingencies or conditions)
of $200,000 or more per year, and (b) all agreements relating to the voting or
disposition of any outstanding shares of capital stock of the Borrower's
Subsidiaries and, to the Borrower's knowledge, of the Borrower.
7.27. Environmental Matters. Except as disclosed in Schedule 7.27,
(a) none of the Borrower, the Guarantors or any of their respective
Subsidiaries, nor any of the properties owned or leased thereby or operations
thereof, nor, to the knowledge of the Borrower and the Guarantors, any current
or prior owner, lessor or operator (other than the Borrower or any Guarantor or
any of their respective Subsidiaries) of any properties owned or leased by
Borrower or any Guarantor or any of their respective Subsidiaries, is in
violation of any applicable Environmental Law or any restrictive covenant or
deed restriction relating to environmental matters (recorded or otherwise) or
subject to any existing, pending or threatened investigation, inquiry or
proceeding by any Governmental Authority or subject to any remedial obligations
under any Environmental Law, except to the extent that the cumulative effect of
all such
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violations, investigations, inquiries, proceedings and remedial obligations
will not have a Material Adverse Effect; (b) all permits, licenses and
approvals required of the Borrowers, the Guarantors or any of their respective
Subsidiaries with respect to Hazardous Materials, including past or present
treatment, storage, disposal or release of any Hazardous Materials or solid
waste into the environment, have been obtained or filed; (c) all Hazardous
Materials or solid waste generated by the Borrower, any Guarantor or any of
their respective Subsidiaries have in the past been, and will continue to be,
transported, treated and disposed of only by carriers maintaining valid permits
under all applicable Environmental Laws and only at treatment, storage and
disposal facilities maintaining valid permits under applicable Environmental
Laws, which carriers and facilities have been and are, to the knowledge of the
Borrower and the Guarantors, operating in compliance with such permits; (d) the
Borrower, the Guarantors and their respective Subsidiaries have taken all
reasonable steps necessary to determine, and have determined, that no Hazardous
Materials or solid wastes have been disposed of or otherwise released by them
except in compliance with Environmental Laws; and (e) neither the Borrower nor
any Guarantor nor any of their respective Subsidiaries has a material
contingent liability in connection with any release of any Hazardous Materials
or solid waste into the environment, and in connection herewith the Borrower
hereby agrees to pursue diligently the resolution of any environmental issues
disclosed in Schedule 7.27 by all necessary and appropriate actions and shall
report to the Administrative Agent not less frequently than quarter-annually as
to the status of the resolution of such issues.
7.28. Material Contracts. Set forth on Schedule 7.28 is a complete
and accurate list of all Material Contracts of the Borrower, each of the
Guarantors and each of their respective Subsidiaries. Other than as set forth
on Schedule 7.28, each such Material Contract is in full force and effect in
accordance with the terms thereof and there are no material defaults by the
Borrower, the Guarantors or any of their respective Subsidiaries as are parties
thereto or, to the knowledge of the Borrower and the Guarantors, by any other
party, under any such Material Contract. The Borrower has delivered to the
Administrative Agent a true and complete copy of each Material Contract
required to be listed on Schedule 7.28.
7.29. No Misstatements. Neither this Agreement nor any of the other
Loan Documents, nor any agreement, instrument or other document executed
pursuant hereto or thereto or in connection herewith or therewith, nor any
certificate, statement or other information referred to herein or therein or
furnished to the Administrative Agent, any Lender or the Issuing Bank pursuant
hereto or thereto or in connection herewith or therewith, contains any
misstatement of a material fact or omits to state any material fact necessary
to make the statements contained herein or therein, in the light of the
circumstances under which they were made, not misleading on the date hereof or
on the date furnished, as the case may be, except as otherwise disclosed to the
Administrative Agent, the Lenders and the Issuing Bank in writing on or prior
to the date hereof. Neither the Borrower nor any Guarantor is aware of any fact
that it has not disclosed in writing to the Administrative Agent that
materially and adversely affects, or insofar as the Borrower or such Guarantor
can now reasonably foresee, could materially and adversely affect, the
properties, businesses, results of operations or financial or other condition
of the Borrower and its Subsidiaries, taken as a whole, the Administrative
Agent's, the Lenders' or the Issuing
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Bank's rights or the ability of the Borrower, any Guarantor or any of their
respective Subsidiaries to perform its obligations under this Agreement and the
other Loan Documents to which it is a party.
7.30. Operating Leases. Schedule 7.30 sets forth each Operating
Lease existing on the date hereof providing for annual lease payments in excess
of $100,000.
ARTICLE 8
AFFIRMATIVE COVENANTS
So long as any Obligations are unpaid or outstanding, any Obligation
under the Loan Documents is unperformed or any of the Commitments are in
effect, the Borrower and Guarantors shall:
8.1. Financial Statements.
8.1.1. Annual Financial Statements and Reports. Furnish to
the Administrative Agent and each Lender, as soon as available and in any event
within ninety (90) days after the end of each Fiscal Year of the Borrower, a
consolidated balance sheet of the Borrower and its Subsidiaries as of the end
of such Fiscal Year and the related consolidated statements of income,
shareholders' equity and cash flows of the Borrower and its Subsidiaries for
such Fiscal Year, audited and reported upon, without qualification, by Ernst &
Young LLP or other independent public accountants acceptable to Requisite
Lenders, accompanied by an unaudited consolidating balance sheet of the
Borrower and its Subsidiaries as of the end of such Fiscal Year and an
unaudited consolidating statement of income for such Fiscal Year, prepared by
such accountants and certified by a Responsible Officer of the Borrower,
together with (a) a certificate of a Responsible Officer of the Borrower
stating that no Default has occurred and is continuing or, if in the opinion of
such officer, a Default has occurred and is continuing, a statement as to the
nature thereof and the action that the Borrower proposes to take with respect
thereto, (b) a certificate of a Responsible Officer of the Borrower, in form
satisfactory to the Administrative Agent and the Lenders, setting forth
computations demonstrating compliance with all financial covenants contained
herein as of the end of such Fiscal Year, and (c) a written discussion and
analysis by the management of the Borrower of the financial statements
furnished in respect of such annual fiscal period.
8.1.2. Quarterly Financial Statements and Reports. Furnish
to the Administrative Agent and each Lender, as soon as available and in any
event within forty-five (45) days after the end of each Fiscal Quarter of the
Borrower (other than the last Fiscal Quarter in any Fiscal Year) an unaudited
consolidated and consolidating balance sheet of the Borrower and its
Subsidiaries as of the end of such Fiscal Quarter, the related consolidated and
consolidating statement of income of the Borrower and its Subsidiaries for the
period commencing at the beginning of the current Fiscal Year and ending with
the end of such Fiscal
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Quarter and the related consolidated statements of shareholders' equity and
cash flows of the Borrower and its Subsidiaries for such period, certified by a
Responsible Officer of the Borrower, together with (a) a certificate of a
Responsible Officer of the Borrower stating that no Default has occurred and is
continuing or, if in the opinion of such officer, a Default has occurred and is
continuing, a statement as to the nature thereof and the action that the
Borrower proposes to take with respect thereto, (b) a certificate of a
Responsible Officer of the Borrower, in form satisfactory to the Administrative
Agent and the Lenders, setting forth computations demonstrating compliance with
all financial covenants contained herein as of the end of such period, and (c)
a written discussion and analysis by the management of the Borrower of the
financial statements furnished in respect of such period.
8.1.3. Monthly Financial Statements and Reports. Furnish to
the Administrative Agent and each Lender, as soon as available and in any event
within thirty (30) days after the end of each month, an unaudited consolidated
balance sheet of the Borrower and its Subsidiaries as of the end of such month,
the related consolidated statement of income of the Borrower and its
Subsidiaries for such month and a schedule of Service Contract operating
margins for such month, certified by a Responsible Officer of the Borrower,
together with a certificate of a Responsible Officer of the Borrower stating
that no Default has occurred and is continuing or, if in the opinion of such
officer, a Default has occurred and is continuing, a statement as to the nature
thereof and the action that the Borrower proposes to take with respect thereto.
8.1.4. GAAP. Take all actions necessary to cause all such
financial statements to be complete and correct in all material respects and to
be prepared in reasonable detail and in conformity with GAAP applied
consistently throughout the periods reflected therein (except as may be
approved by such accountants or Responsible Officer, as the case may be, and
disclosed therein).
8.2. Certificates and Other Information. Furnish to the
Administrative Agent and each Lender, each in form and substance acceptable to
Requisite Lenders:
8.2.1. Management Letters. Promptly after the same are
received by the Borrower, copies of management letters provided to the Borrower
by its independent certified public accountants that describe or refer to any
inadequacy, defect, problem, qualification or other lack of satisfactory
accounting controls utilized by the Borrower or any of its Subsidiaries.
8.2.2. Shareholder Materials. (a) Within two (2) Business
Days after the delivery of same to the shareholders of the Borrower, copies of
all financial statements and reports that the Borrower, any Guarantor or any of
their respective Subsidiaries sends to the shareholders of the Borrower, and
(b) concurrently with the filing thereof, copies of all reports and statements
of the Borrower, the Guarantors and their respective Subsidiaries (including
proxy and information statements, quarterly, annual and current reports and
registration statements, but excluding those pertaining only to employee
benefit plans) that it may make to, or file with, the Commission.
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8.2.3. Budgets. As soon as available, and in any event not
later than sixty (60) days after the end of each Fiscal Year of the Borrower,
twelve (12) month budgeted financial statements (including balance sheets and
statements of income, shareholders' equity and cash flows and a statement of
budgeted Ordinary Capital Expenditures, and including a reasonably detailed
description of all underlying assumptions) of the Borrower and its Subsidiaries
on a consolidated basis for the following Fiscal Year, and twelve (12) month
consolidating budgeted statements of income of the Borrower and each of its
Subsidiaries for the following Fiscal Year, all in a format reasonably
acceptable to Requisite Lenders and certified by a Responsible Officer of the
Borrower as being fairly stated in good faith. Any updates thereto shall be
provided upon request of the Administrative Agent.
8.2.4. Asset Acquisitions. Not later than thirty (30) days
prior to the consummation of any Asset Acquisition, notice of the pendency of
such Asset Acquisition (or if such notice is not reasonably practicable, such
prior notice not less than fifteen (15) Business Days prior to such
consummation as is reasonably practicable), and not later than fifteen (15)
Business Days prior to the consummation of such Asset Acquisition, the
following:
(a) a reasonably detailed description of the operating
profile for the assets to be acquired in such Asset Acquisition, and
(b) a reasonably detailed description of the terms and
conditions of such Asset Acquisition, including the purchase price and
the manner and structure of payment(s), accompanied by copies of the
then-current drafts of the proposed acquisition agreement(s), and
(c) with respect to any Permitted Acquisition, a
certificate duly executed by a Responsible Officer of the Borrower, in
form satisfactory to the Administrative Agent, certifying that no
Default has occurred or is continuing or will result from such Asset
Acquisition, certifying that after giving Pro Forma Effect to such
Asset Acquisition and to any other transactions or occurrences to
which such term is applicable as of the date of determination, such
Responsible Officer reasonably believes that such Asset Acquisition
will not result in a violation of any of the financial covenants
contained herein during the twelve (12) month period following such
Asset Acquisition, and setting forth computations demonstrating
compliance with all financial covenants contained herein as of the end
of the Fiscal Quarter then most recently completed, after giving Pro
Forma Effect to such Asset Acquisition and to any other transactions
or occurrences to which such term is applicable as of the date of
determination, and
(d) with respect to any Asset Acquisition that does not
constitute a Permitted Acquisition:
(1) copies of financial statements for the
assets to be acquired for the two (2) most recent fiscal
years and for any subsequent interim accounting periods, and
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(2) a certificate duly executed by a
Responsible Officer of the Borrower, in form satisfactory to
the Administrative Agent, certifying that no Default has
occurred or is continuing or will result from such Asset
Acquisition (assuming Requisite Lenders consent to or waive
any violation of subsection 9.7(c)), certifying that after
giving Pro Forma Effect to such Asset Acquisition and to any
other transactions or occurrences to which such term is
applicable as of the date of determination, such Responsible
Officer reasonably believes that such Asset Acquisition will
not result in a violation of any of the financial covenants
contained herein during the twelve (12) month period
following such Asset Acquisition, and setting forth
computations demonstrating compliance with all financial
covenants contained herein as of the end of the Fiscal
Quarter then most recently completed, after giving Pro Forma
Effect to such Asset Acquisition and to any other
transactions or occurrences to which such term is applicable
as of the date of determination, and
(e) any other written information regarding such Asset
Acquisition, not described above in this Section 8.2.4, that is
furnished to the directors of the Borrower.
8.2.5. Acquisition Documents. Not later than fifteen (15)
days after the consummation of any Asset Acquisition, copies of the executed
documents evidencing the transaction.
8.2.6. Communications Regarding Service Contracts. Within
fifteen (15) days following the receipt thereof, a copy of any audit,
statement, notice of deficiency or default, or other report or communication
from any Governmental Authority or other Person relating to performance by the
Borrower or any of its Subsidiaries under any Service Contract.
8.2.7. Reports to Other Persons. Promptly after the
furnishing thereof, copies of any statement or report furnished to any other
holder of any Indebtedness of the Borrower, any of the Guarantors or any of
their respective Subsidiaries pursuant to the terms of any indenture, loan or
credit or similar agreement and not otherwise required to be furnished to the
Administrative Agent or Lenders pursuant to any other clause of this Section
8.2.
8.2.8. Funded Indebtedness. Promptly upon request by the
Administrative Agent, copies of all agreements, instruments or documents
evidencing or otherwise related to Consolidated Funded Indebtedness.
8.2.9. Employment and Investment Agreements. Promptly upon
request by the Administrative Agent, a true and complete copy of each of the
agreements required to be listed on Schedule 7.26.
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8.2.10. Additional Information. Promptly, such additional
financial and other information as the Administrative Agent or any Lender from
time to time reasonably may request.
8.3. Provision of Notices. Notify the Administrative Agent and
each Lender of the occurrence of any of the following events not later than
five (5) days after the Borrower or any Guarantor knows or has reason to know
of such event:
8.3.1. Default. Any Default.
8.3.2. Other Default or Litigation. (a) Any default or
event of default under any Contractual Obligation of the Borrower, any
Guarantor or any of their respective Subsidiaries that reasonably could be
expected to have a Material Adverse Effect, (b) any litigation, investigation
or proceeding that may exist at any time between the Borrower, any Guarantor or
any of their respective Subsidiaries and any Governmental Authority (excluding,
however, audits and inquiries made in the ordinary course of business), or (c)
any other litigation that if adversely determined reasonably could be expected
to have a Material Adverse Effect.
8.3.3. Reportable Events. (a) Any Reportable Event with
respect to any Plan, (b) the institution of proceedings or the taking or
expected taking of any other action by the PBGC, the Borrower, any Guarantor,
any of their respective Subsidiaries or any Commonly Controlled Entity to
terminate, withdraw or partially withdraw from any Plan, and (c) with respect
to any Multi-Employer Plan, the reorganization or insolvency of such Plan. In
addition to such notice, the Borrower and the Guarantors shall deliver or cause
to be delivered to the Administrative Agent and each Lender whichever of the
following may be applicable: (i) a certificate of a Responsible Officer of the
Borrower or such Guarantor setting forth details as to such Reportable Event
and the action that it, such Subsidiary or the Commonly Controlled Entity
proposes to take with respect thereto, together with the copy of any notice of
such Reportable Event that may be required to be filed with the PBGC, or (ii)
any notice delivered by the PBGC evidencing its intent to institute such
proceedings or any notice to the PBGC that such Plan is to be terminated, as
the case may be.
8.3.4. Environmental Matters. (a) Any event that makes any
of the representations set forth in Section 7.27 inaccurate in any respect or
(b) the receipt by the Borrower, any of the Guarantors or any of their
respective Subsidiaries of any notice, order, directive or other communication
from a Governmental Authority alleging a violation of or noncompliance with any
Environmental Laws.
8.3.5. Loss of License, Permit, Approval, Etc.
(a) The loss or, if known by the Borrower, any Guarantor
or any of their respective Subsidiaries, threatened loss, by the
Borrower, any Guarantor or any of their respective Subsidiaries, of
any license, permit, approval, registration, contract, consent,
franchise, qualification, certificate of need, accreditation or other
authorization issued by
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any Governmental Authority referenced in Section 7.24, if such loss
reasonably could be expected to have a Material Adverse Effect; or
(b) The decertification or, if known by the Borrower,
any Guarantor or any of their respective Subsidiaries, potential
decertification, of the Borrower, any Guarantor or any of their
respective Subsidiaries, under any program relating to Service
Contracts, if such decertification reasonably could be expected to
have a Material Adverse Effect.
8.3.6. Material Contracts. (a) Any proposed material
amendment, change or modification to, or waiver of any material provision of,
or any termination of, any Material Contract and (b) any default or event of
default under any Material Contract.
8.3.7. Casualty Losses. Any casualty loss or event not
insured against in an amount in excess of $250,000.
8.3.8. Other Matters. Any change in the information
disclosed in Schedules 7.1, 7.18A or 7.18B that would have been required to be
disclosed in such schedule(s) had such change been in effect on the date of
this Agreement.
8.4. Payment of Obligations and Performance of Covenants.
(a) Make full and timely payment of the Obligations,
including the Loans and Letter of Credit Liabilities, whether now
existing or hereafter arising;
(b) Duly comply with all terms, covenants and conditions
contained in each of the Loan Documents, at the times and places and
in the manner set forth therein; and
(c) Take all action requested by the Administrative
Agent in order to maintain the security interests provided for under
this Agreement and the Security Documents as valid and perfected Liens
on the property intended to be covered thereby, subject to no other
Liens except Permitted Liens, and supply all information requested by
the Administrative Agent or the Lenders necessary to accomplish same.
8.5. Payment of Taxes. Pay, and cause their respective
Subsidiaries to pay, or cause to be paid before the same shall become
delinquent and before penalties have accrued thereon, all taxes, assessments
and governmental charges or levies imposed on the income, profits, franchises,
property or businesses of the Borrower, the Guarantors or their respective
Subsidiaries, except to the extent and so long as (a) the same are being
contested in good faith by appropriate proceedings and (b) adequate reserves
with respect thereto in conformity with GAAP have been provided on the books of
the Borrower or any such Guarantor or Subsidiary, as appropriate.
8.6. Conduct of Business and Maintenance of Existence. Continue,
and cause their respective Subsidiaries to continue, (a) to engage solely in
the business of providing managed
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healthcare services to correctional facilities and related businesses that
enhance or support that primary business activity, and (b) except as permitted
by Sections 9.3 and 9.7, to preserve, renew and keep in full force and effect
their existence and present corporate, partnership or other organizational
structure, as the case may be.
8.7. Compliance with Law. Observe and comply with, and cause their
respective Subsidiaries to observe and comply with, all present and future
Requirements of Law relating to the conduct of their businesses or to their
properties or assets, except to the extent and so long as the nonobservance
thereof or noncompliance therewith will not have a Material Adverse Effect.
8.8. Maintenance of Properties and Franchises. Maintain, preserve
and keep and cause their respective Subsidiaries to maintain, preserve and keep
(a) all of their buildings, tangible properties, equipment and other property
and assets used and necessary in their businesses, whether owned or leased, in
good repair, working order and condition, from time to time making all
necessary and proper repairs and replacements so that at all times the utility,
efficiency and value thereof shall not be impaired, and (b) all rights,
privileges and franchises necessary or desirable in the normal conduct of their
businesses.
8.9. Insurance.
(a) Maintain and cause their respective Subsidiaries to
maintain:
(1) insurance (in addition to any insurance
required under the Security Documents) on all insurable
operations of and insurable property and assets owned or
leased by the Borrower, the Guarantors or any of their
respective Subsidiaries in the manner, to the extent and
against at least such risks (in any event including
professional and comprehensive general liability, workers'
compensation, employer's liability, automobile liability and
physical damage, fiduciary liability, commercial fidelity,
employee benefits liability and all-risk property) usually
maintained by owners of similar businesses and properties in
similar geographic areas; provided that the amounts of
property insurance coverages shall not be less than the full
replacement cost of all such insurable property and assets,
except for coverage limitations with respect to flood,
earthquake and windstorm perils that are acceptable to the
Administrative Agent and Requisite Lenders; and
(2) self-insurance reserves covering those
risks for which the Borrower, the Guarantors and each of
their respective Subsidiaries presently self-insure in
appropriate amounts as determined from time to time by
independent insurance claims auditors acceptable to the
Administrative Agent and Requisite Lenders.
All such insurance shall be in such amounts, in such form and with
such insurance companies as are reasonably satisfactory to the
Administrative Agent and Requisite
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Lenders. Without limiting the foregoing, and unless otherwise approved
by the Administrative Agent, all policies of property/casualty
insurance shall provide that such insurance shall be payable to the
Borrower, its Subsidiaries, the Administrative Agent, the Lenders and
the Issuing Bank as their respective interests may appear.
(b) Furnish to the Administrative Agent not less
frequently than annually and at any time upon written request, (i)
full information as to such insurance carried, including the amounts
of all self-insurance reserves of the Borrower, the Guarantors and
their respective Subsidiaries, and (ii) certificates of insurance from
the insurance companies and certified copies of such insurance
policies. All policies of insurance (or certificates of insurance in
favor of the Administrative Agent with respect thereto) shall provide
for not less than fifteen (15) days' prior written notice to the
Administrative Agent of the cancellation or any material alteration of
the policy.
8.10. Use of Proceeds. Use, and cause their respective Subsidiaries
to use, the proceeds of the Facilities for the purposes specified in Section
2.10 and for no other purpose.
8.11. Books and Records. Keep and maintain, and cause their
respective Subsidiaries to keep and maintain, full and accurate books of record
and accounts of their operations, dealings and transactions in relation to
their business and activities, in conformity with GAAP and all Requirements of
Law.
8.12. Inspection. Permit, and cause their respective Subsidiaries
to permit, any employees, agents or other representatives of the Administrative
Agent or the Lenders (including attorneys, accountants and other agents or
representatives designated by the Administrative Agent or the Lenders) to (a)
have access to and visit and inspect any of the books of account, financial
records and properties, real, personal or mixed, of the Borrower, the
Guarantors and their respective Subsidiaries (b) examine and make abstracts
from any such books and records, and (c) discuss the affairs, finances and
accounts of the Borrower, the Guarantors and their respective Subsidiaries with
their officers, employees or agents, all upon such reasonable notice to the
Borrower during business hours and at such reasonable business times as the
Administrative Agent or the Lenders deem necessary or advisable to protect
their respective interests.
8.13. Compliance With Terms of Material Contracts. Comply, and
cause their respective Subsidiaries to comply, with all agreements, covenants,
terms, conditions and provisions of all Material Contracts, except to the
extent and so long as noncompliance therewith will not have a Material Adverse
Effect .
8.14. Compliance With Environmental Laws, Etc.
(a) Employ, and cause their respective Subsidiaries to
employ, in connection with the use of any real property, appropriate
technology (including appropriate
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secondary containment measures) to maintain compliance with any
applicable Environmental Laws;
(b) take, and cause their respective Subsidiaries to
take, all actions necessary to comply with all Environmental Laws,
including any actions identified as necessary in any environmental
compliance reports delivered to the Administrative Agent pursuant to
the provisions of this Agreement;
(c) obtain and maintain, and cause their respective
Subsidiaries to obtain and maintain, any and all permits required by
applicable Environmental Laws in connection with the operations of the
Borrower, the Guarantors or any of their respective Subsidiaries or
any Affiliate thereof;
(d) dispose of, and cause their respective Subsidiaries
to dispose of, any and all Hazardous Materials only at facilities and
with carriers maintaining valid permits under any applicable federal,
state and local Environmental Laws; and
(e) use best efforts to obtain, and cause their
respective Subsidiaries to use their best efforts to obtain,
certificates of disposal from all contractors employed by the
Borrower, the Guarantors or any of their respective Subsidiaries in
connection with the transportation or disposal of any Hazardous
Materials.
8.15. Environmental Monitoring. Establish and maintain, and cause
their respective Subsidiaries to establish and maintain, a system to assure and
monitor continued compliance with all applicable Environmental Laws,
noncompliance with which would have a Material Adverse Effect, which system
shall include annual reviews of such compliance by employees or agents of the
Borrower, the Guarantors and their respective Subsidiaries who are familiar
with the requirements of applicable Environmental Laws.
8.16. Maintenance of Licenses, Permits, Approvals, Etc. Preserve
and maintain, and cause their respective Subsidiaries to preserve and maintain,
all licenses, permits, approvals, registrations, contracts, consents,
franchises, qualifications, certificates of need, accreditations and other
authorizations required under applicable state or local laws and regulations in
connection with the ownership or operation of their businesses, except to the
extent that a failure to preserve and maintain any of same will not have a
Material Adverse Effect.
8.17. Intercompany Indebtedness; Pledged Notes.
(a) Maintain, and cause their respective Subsidiaries to
maintain, accounting systems, practices and procedures that enable the
Borrower, the Guarantors and their respective Subsidiaries to report
to the Administrative Agent at any time upon its request the aggregate
unpaid balance of any unsecured advances or loans owing to the
Borrower or a Guarantor by any such Subsidiary; and
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(b) Cause all such advances or loans to be evidenced by
Pledged Notes delivered to the Administrative Agent pursuant to the
Pledge Agreement and, contemporaneously with the delivery to the
Administrative Agent of any Pledged Note, assign and deliver to the
Administrative Agent any loan agreement or other instrument, document
or agreement further evidencing, securing or otherwise relating to the
indebtedness evidenced by such Pledged Note.
8.18. Further Assurances. Perform, make, execute and deliver, and
cause their respective Subsidiaries to perform, make, execute and deliver, all
such additional and further acts, deeds, occurrences and instruments as the
Administrative Agent, the Lenders or the Issuing Bank reasonably may require to
document and consummate the transactions contemplated hereby and to vest
completely in and to ensure the Administrative Agent, the Lenders and the
Issuing Bank their respective rights under this Agreement, the Notes and the
other Loan Documents.
8.19. Post-Closing Matters. Deliver to the Administrative Agent each
item listed on Schedule 8.19 prior to the deadline therefor as set forth on said
schedule.
8.20. Management. Cause substantially all of the principal executive
management functions of the Borrower and its Subsidiaries to be vested in and
the responsibility of not less than two of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
▇▇▇▇▇ ▇. ▇▇▇▇ and any replacement of any of the foregoing who has been approved
in writing by the Administrative Agent for purposes of this Section 8.20.
8.21. Interest Rate Contracts. Within sixty (60) days after the date
of this Agreement, enter into and maintain interest rate protection agreements,
in form and substance and with parties satisfactory to the Borrower and the
Administrative Agent, in order to protect against risks in fluctuations in
interest rates with respect to not less than $30,000,000 of the Facilities, such
agreements to have a minimum term of two (2) years.
ARTICLE 9
NEGATIVE COVENANTS
So long as any Obligations are unpaid or outstanding, any Obligation
under the Loan Documents is unperformed or any of the Commitments are in effect,
the Borrower and the Guarantors shall not:
9.1. Indebtedness. Create, incur, assume or suffer to exist, or
permit any of their respective Subsidiaries to create, incur, assume or suffer
to exist, any Indebtedness, except:
(a) Indebtedness of the Borrower or any of the Guarantors
under or pursuant to this Agreement and the other Loan Documents;
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(b) Indebtedness existing, or arising pursuant to
commitments existing, on the date hereof, all as set forth in Schedules
7.17A and 7.17B, and any extensions, refundings or renewals thereof on
the same terms or other terms satisfactory to Requisite Lenders;
provided, however, that neither the principal amount thereof nor the
interest rate thereon shall be increased, nor shall the amortization
schedule thereof be shortened;
(c) Purchase Money Debt that is incurred to finance
Reimbursable Capital Expenditures and that is in an aggregate amount
outstanding at any time not exceeding the Reimbursable Capital
Expenditure Limit, other Purchase Money Debt in an aggregate amount
outstanding at any time not exceeding $1,000,000, and Capitalized Lease
Obligations;
(d) Subordinated Indebtedness;
(e) Indebtedness constituting current liabilities
incurred in the ordinary course of business and not represented by any
note, bond, debenture or other instrument, and which is not past due
for a period in excess of that which is customary for similar
businesses, or if overdue for a greater period of time, which are being
contested in good faith and by appropriate actions and for which
adequate reserves in conformity with GAAP have been established on the
books of the primary obligor with respect thereto;
(f) Contingent Obligations under guarantees executed by
the Borrower, any Guarantor or any of their respective Subsidiaries
with respect to Indebtedness of the Borrower and its Subsidiaries
otherwise permitted by this Agreement;
(g) Contingent Obligations consisting of the
indemnification by the Borrower or any of its Subsidiaries of (i) the
officers, directors, employees and agents of the Borrower or such
Subsidiary, to the extent permissible under the corporation law of the
jurisdiction in which the Borrower or such Subsidiary is organized,
(ii) commercial banks, investment bankers and other independent
consultants or professional advisors pursuant to agreements relating to
the underwriting of the Borrower's or such Subsidiary's securities or
the rendering of banking or professional services to the Borrower or
such Subsidiary, (iii) landlords, licensors, licensees and other
parties pursuant to agreements entered into in the ordinary course of
business by the Borrower or such Subsidiary, and (iv) sellers in
Permitted Acquisitions pursuant to indemnification provisions customary
for such transactions;
(h) Indebtedness with respect to financed insurance
premiums not past due;
(i) Indebtedness of the Borrower or a Subsidiary of the
Borrower that is owed to the Borrower or a Subsidiary of the Borrower
and that is described in clauses (d), (e) or (h) of Section 9.4;
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(j) unsecured Indebtedness of the Borrower and its
Subsidiaries, not otherwise described in this Section 9.1, in an
aggregate amount not to exceed $1,000,000 outstanding at any one time;
and
(k) Indebtedness of an Insurance Subsidiary under
insurance policies issued by such Insurance Subsidiary in the ordinary
course of business.
9.2. Liens. Create, incur, assume or suffer to exist, or permit any
of their respective Subsidiaries to create, incur, assume or suffer to exist,
any Lien upon any real or personal property, fixtures, revenues or other assets
whatsoever (including the Collateral), whether now owned or hereafter acquired,
of the Borrower, the Guarantors or any of their respective Subsidiaries, except:
(a) Liens securing the Obligations;
(b) Existing Liens;
(c) Liens for taxes not yet due or that are being
contested in good faith and by appropriate actions and for which
adequate reserves in conformity with GAAP have been established on the
books of the Borrower or such Guarantor or Subsidiary;
(d) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of
business that are not overdue for a period of more than thirty (30)
days, or if overdue for more than thirty (30) days, (i) which are being
contested in good faith and by appropriate proceedings, (ii) for which
adequate reserves in conformity with GAAP have been established on the
books of the Borrower or such Guarantor or Subsidiary; and (iii) with
respect to which the obligations secured thereby are not material;
(e) pledges or deposits in connection with workers'
compensation insurance, unemployment insurance and like matters;
(f) Liens securing Purchase Money Debt or Capitalized
Lease Obligations; provided, however, that any such Lien attaches only
to the item or items of property or asset financed with such Purchase
Money Debt or Capitalized Lease;
(g) deposits to secure the performance of bids, trade
contracts (other than for borrowed money), leases, statutory
obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of
business;
(h) easements, reservations, exceptions, rights-of-way,
covenants, conditions, restrictions and other similar encumbrances
incurred in the ordinary course of business that, in the aggregate, are
not substantial in amount, and that do not in any case materially
detract from the value of the property subject thereto or interfere
with the ordinary conduct of business by the Borrower or such Guarantor
or Subsidiary;
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(i) Liens in respect of any writ of execution,
attachment, garnishment, judgment or award in an amount less than
$100,000, if (i) the time for appeal or petition for rehearing has not
expired, an appeal or appropriate proceeding for review is being
prosecuted in good faith and a stay of execution pending such appeal or
proceeding for review has been secured, or (ii) the underlying claim is
fully covered by insurance, the insurer has acknowledged in writing its
responsibility to pay such claim and no action has been taken to
enforce such execution, attachment, garnishment, judgment or award;
(j) Liens of lessors under or in connection with
Operating Leases;
(k) Liens securing Indebtedness permitted under clause
(b) of Section 9.1, but only to the extent that such Indebtedness is
presently secured as set forth on Schedule 7.17A; and
(l) Other non-consensual Liens not securing Indebtedness,
the existence of which in the aggregate will not have a Material
Adverse Effect; provided that any Lien permitted by this clause (l) is
permitted only for so long as is reasonably necessary for the Borrower
or the affected Subsidiary, using its best efforts, to remove or
eliminate such Lien.
9.3. Sale or Transfer of Assets. Sell, lease, assign, transfer or
otherwise dispose of, or permit any of their respective Subsidiaries to sell,
lease, assign, transfer or otherwise dispose of, any of their assets (including
the stock of Subsidiaries) except:
(a) sales of personal property assets in the ordinary
course of business of the Borrower and its Subsidiaries;
(b) the disposition of obsolete or worn-out equipment or
other property no longer required by or useful to the Borrower or any
of its Subsidiaries in connection with the operation of their
businesses;
(c) the sale or transfer to the Borrower or any Guarantor
of any asset owned by the Borrower or any of its Subsidiaries; and
(d) sale(s) of assets not otherwise permitted by this
Section 9.3 in an aggregate amount not to exceed, in any Fiscal Year,
an amount equal to five percent (5%) of the consolidated assets of the
Borrower and its Subsidiaries, determined in conformity with GAAP, as
of the end of the most recently completed Fiscal Year of the Borrower.
9.4. Investments. Make, commit to make or suffer to exist, or
permit any of their respective Subsidiaries to make, commit to make or suffer to
exist, any Investment except:
(a) Cash Equivalents;
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(b) Investments existing on the date hereof and set forth
in Schedule 9.4;
(c) accounts receivable representing trade credit
extended in the ordinary course of business;
(d) unsecured loans or advances by the Borrower or any
Guarantor to any Guarantor or the Borrower;
(e) unsecured loans or advances by any Subsidiary of the
Borrower to the Borrower or any Guarantor;
(f) Investments consisting of Permitted Acquisitions;
(g) Investments in Guarantors that otherwise are
permitted by the terms of this Agreement;
(h) Investments in Permitted Non-Guarantor Entities that
are not prohibited by Section 9.13;
(i) Permitted Insurance Subsidiary Investments; and
(j) Redemptions of Convertible Preferred Stock that are
not prohibited by Section 9.5.
9.5. Restricted Payments. Declare, pay or make, or permit any of
their respective Subsidiaries to declare, pay or make any Restricted Payments
except:
(a) the Borrower may declare and deliver dividends and
make distributions that are payable solely in common stock of the
Borrower, and may distribute cash in lieu of fractional shares
otherwise distributable pursuant to this clause (a);
(b) to the extent provided in the Certificate of
Designation, the Borrower may declare and deliver dividends and make
distributions in respect of the Convertible Preferred Stock that are
payable solely in Convertible Preferred Stock, and may distribute cash
in lieu of fractional shares otherwise distributable pursuant to this
clause (b);
(c) the Borrower may declare and deliver cash dividends
and make cash distributions in respect of the Convertible Preferred
Stock as provided in the Certificate of Designation and may redeem
Convertible Preferred Stock as provided in the Certificate of
Designation, provided that in each case:
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(1) no Default shall have occurred and be
continuing at the time of declaration or, after giving effect
to such dividend, distribution or other payment, at the time
of payment; and
(2) the aggregate amount expended pursuant to
this clause (c) in any Fiscal Quarter shall not exceed an
amount that, if such amount had been so expended in the
immediately preceding Fiscal Quarter, would not have resulted
in a violation of Section 10.1.2 or otherwise have resulted in
the occurrence of a Default;
(d) Convertible Preferred Stock may be converted into
common stock of the Borrower as provided in the Certificate of
Designation;
(e) the Borrower may purchase or otherwise acquire shares
of its capital stock or the Warrants by exchange for or out of the
proceeds received from a substantially concurrent issue of shares of
its capital stock;
(f) the Borrower may purchase or otherwise acquire
fractional shares of its capital stock in connection with a transaction
otherwise permitted by this Section 9.5; and
(g) the Borrower may repay Subordinated Indebtedness
using proceeds received from (i) a substantially concurrent incurrence
of new Subordinated Indebtedness, or (ii) a substantially concurrent
issue of shares of its capital stock.
This Section 9.5 shall not be deemed to preclude the accrual of dividends in
respect of outstanding Convertible Preferred Stock in accordance with the terms
of the Certificate of Designation; provided, however, that such dividends may
not be declared or paid except to the extent otherwise permitted hereunder.
9.6. Issuance of Stock. Issue any capital stock or permit any
Subsidiary to issue any capital stock; provided, however, that
(a) the Borrower may issue common stock and warrants,
options or other rights to acquire the Borrower's common stock
(including the Warrants);
(b) the Borrower may issue Convertible Preferred Stock to
the extent provided in the Securities Purchase Agreement and the
Certificate of Designation;
(c) the Borrower and its Subsidiaries may issue
Qualifying Preferred Stock to the extent that the aggregate of all
outstanding Qualifying Preferred Stock does not require the payment of
dividends in excess of the amounts, if any, permitted under Section
9.5; and
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(d) any Subsidiary of the Borrower may issue capital
stock to the Borrower or any wholly-owned Subsidiary of the Borrower.
9.7. Fundamental Changes. Directly or indirectly (whether in one
transaction or a series of transactions), or permit any of their respective
Subsidiaries directly or indirectly (whether in one transaction or a series of
transactions) to:
(a) enter into any transaction of merger, consolidation
or amalgamation;
(b) liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution);
(c) make any Asset Acquisition other than a Permitted
Acquisition; or
(d) enter into any agreement or transaction to do or
permit any of the foregoing;
provided, however, that:
(1) notwithstanding clause (a) of this Section
9.7, the merger, consolidation or amalgamation of any Person
with the Borrower or any Guarantor as the method by which a
Permitted Acquisition is accomplished shall be permitted,
provided that the Borrower or such Guarantor is the surviving
entity in the transaction;
(2) notwithstanding clause (a) of this Section
9.7, the merger, consolidation or amalgamation of any
Subsidiary of the Borrower with any Guarantor shall be
permitted, provided that such Guarantor is the surviving
entity in the transaction;
(3) notwithstanding clause (a) of this Section
9.7, the merger, consolidation or amalgamation of any
Subsidiary of the Borrower with the Borrower shall be
permitted, provided that the Borrower is the surviving entity
in the transaction; and
(4) notwithstanding clause (b) of this Section
9.7, the Borrower may permit the dissolution of any of its
Subsidiaries (and any such Subsidiary may suffer such
dissolution) if at the time of such dissolution such
Subsidiary has no assets, engages in no business and otherwise
has no activities other than activities related to the
maintenance of its corporate existence and good standing.
9.8. Transactions With Affiliates. Enter into, or permit any of
their respective Subsidiaries to enter into, any transaction, including any
purchase, sale, lease or exchange of property or the rendering of any service,
with any Affiliate or employee of the Borrower or any
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of its Subsidiaries, except (a) transactions that are in the ordinary course of
business of the Borrower or such Guarantor or Subsidiary and that are upon fair
and reasonable terms no less favorable to the Borrower or such Guarantor or
Subsidiary than would be obtained in a comparable arm's length transaction with
a Person not an Affiliate, and (b) the transactions that are the subject of the
Securities Purchase Agreement and the instruments, documents and agreements
contemplated by the Securities Purchase Agreement.
9.9. Agreements Restricting the Borrower and Its Subsidiaries.
Enter into or become a party to, or permit any of their respective Subsidiaries
to enter into or become a party to, any agreement with any Person (other than
this Agreement and the Loan Documents) that in any way prohibits, restricts or
limits the ability of the Borrower, any Guarantor or any such Subsidiary to:
(a) transfer cash or other assets to the Borrower or any
of its Subsidiaries, or
(b) create, incur, assume or suffer to exist any Lien
with respect to any real or personal property, fixtures, revenues or
other assets whatsoever, whether now owned or hereafter acquired, of
the Borrower, any Guarantor or any such Subsidiary, as security for the
Obligations (as the same may be increased from time to time),
excluding, however, customary prohibitions, restrictions and
limitations contained in the instruments evidencing Purchase Money Debt
and Capitalized Lease Obligations permitted by Sections 9.1 and 9.2, so
long as such prohibitions, restrictions and limitations apply only to
the assets financed thereby.
9.10. ERISA.
(a) Terminate or permit any of their respective
Subsidiaries to terminate any Plan so as to result in any material
liability to the PBGC;
(b) Engage or permit any of their respective Subsidiaries
to engage in any "prohibited transaction" (as defined in Section 4975
of the Code) involving any Plan that would result in a material
liability for an excise tax or civil penalty in connection therewith;
(c) Incur or suffer to exist, or permit any of their
respective Subsidiaries to incur or suffer to exist, any material
"accumulated funding deficiency" (as defined in Section 302 of ERISA),
regardless of whether waived, involving any Plan; or
(d) Allow or suffer to exist, or permit any of their
respective Subsidiaries to allow or suffer to exist, any event or
condition that presents a material risk of incurring a material
liability to the PBGC by reason of the termination of any Plan.
9.11. Maintenance of Material Contracts. Without the prior written
consent of Requisite Lenders, enter into an agreement to cancel, terminate or
surrender, or enter into any
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material amendment of, any Material Contract, unless the cumulative effect of
all such cancellations, terminations, surrenders, and amendments will not have a
Material Adverse Effect.
9.12. Adverse Transactions. Enter into or become a party to, or
permit any of their respective Subsidiaries to enter into or become a party to,
any transactions the performance of which in the future, individually or in the
aggregate, would have a Material Adverse Effect.
9.13. Restrictions on Investments in Permitted Non-Guarantor
Entities. Make new or additional Investments in Permitted Non-Guarantor Entities
(a) at any time that the aggregate Investments of the Borrower and its
Subsidiaries in Permitted Non-Guarantor Entities is equal to or greater than
five percent (5%) of the consolidated assets of the Borrower and its
Subsidiaries, determined in conformity with GAAP, or (b) during any Fiscal
Quarter following a Fiscal Quarter in which any net income of the Borrower and
its Subsidiaries attributable to Permitted Non-Guarantor Entities was excluded
from Consolidated Net Income pursuant to the proviso included in the definition
of that term.
9.14. Subordinated Indebtedness. Modify, amend or in any way change
the terms of any Subordinated Indebtedness or any instrument, document or
agreement evidencing same or related thereto, if the effect of any such
modification, amendment or change would be to (a) increase the interest rate
applicable to such Subordinated Indebtedness (excluding automatic adjustments in
a variable rate of interest in accordance with the terms of the instruments,
documents or agreements evidencing same), (b) accelerate the date for the making
of any required payment of principal or increase the amount due on any such
date, (c) modify the terms of subordination, as they apply to the Obligations,
in a manner that would affect adversely the rights of the Administrative Agent,
the Lenders or the Issuing Bank vis-a-vis the holder(s) of such Subordinated
Indebtedness, or (d) otherwise materially affect the rights of the
Administrative Agent, the Lenders or the Issuing Bank vis-a-vis the holder(s) of
such Subordinated Indebtedness.
ARTICLE 10
FINANCIAL COVENANTS
10.1. Borrower Financial Covenants. So long as any Obligations are
unpaid or outstanding, any Obligation under the Loan Documents is unperformed or
any of the Commitments are in effect, the Borrower and the Guarantors shall not:
10.1.1. Minimum Net Worth. Permit Net Worth as of the end of
any Fiscal Quarter to be less than the sum of (a) ninety percent (90%) of Net
Worth as of the end of the Fiscal Quarter ended June 30, 2000, plus (b) 75% of
cumulative Consolidated Net Income for each Fiscal Quarter beginning with the
Fiscal Quarter ending September 30, 2000, with no decrease for any negative
Consolidated Net Income during any Fiscal Quarter.
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10.1.2. Fixed Charge Coverage Ratio. Permit the Fixed Charge
Coverage Ratio as of the end of any Fiscal Quarter to be less than 1.25 to 1.00.
10.1.3. Leverage Ratio. Permit the Leverage Ratio as of the
end of any Fiscal Quarter to be greater than 2.75 to 1.00.
10.1.4. Capital Expenditures. Make Ordinary Capital
Expenditures in an aggregate amount in excess of $3,000,000 in any one Fiscal
Year, or make any Reimbursable Capital Expenditure at any time if the aggregate
unreimbursed amount outstanding in respect of Reimbursable Capital Expenditures
would exceed the Reimbursable Capital Expenditure Limit.
10.2. Guarantor Solvency. So long as any Obligations or any
Guaranteed Obligations are unpaid or outstanding, any Obligations under the Loan
Documents are unperformed or any of the Commitments are in effect, each of the
Guarantors at all times shall be Solvent.
ARTICLE 11
EVENTS OF DEFAULT AND LENDERS' REMEDIES
11.1. Events of Default. Any one or more of the following described
events shall constitute an Event of Default hereunder, whether such occurrence
shall be voluntary or involuntary, or come about or be effected by operation of
law or otherwise:
11.1.1. Failure to Pay Loans, Etc. The Borrower shall fail to
pay, within five (5) days of the date due, any interest payable on or in respect
of the Loans or the Letter of Credit Liabilities, or shall fail to pay, when
due, any amount of principal of or any other interest payable on or in respect
of the Loans, the Letter of Credit Liabilities, the Credit Fees or any of the
other Obligations or any other amount payable under this Agreement, the Notes or
the other Loan Documents.
11.1.2. Failure to Perform Certain Covenants. The Borrower or
any Guarantor shall fail to perform or observe any of its covenants and
agreements set forth in Sections 8.6, 8.10 or 8.12 or in Articles 9 or 10.
11.1.3. Failure to Perform Agreements Generally. The Borrower
or any Guarantor shall fail to perform or observe any of its other covenants and
agreements set forth in this Agreement (other than those described in Sections
11.1.1 and 11.1.2) or the other Loan Documents, and such failure shall continue
for more than thirty (30) days after the earlier of (a) written notice from the
Administrative Agent to the Borrower or such Guarantor, as applicable, of the
existence of such Default, or (b) the date any Responsible Officer of the
Borrower or such Guarantor, as applicable, first obtains knowledge of such
failure.
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11.1.4. Defaults Under Other Loan Documents. Any default or
event of default shall occur under any other Loan Document, and, if subject to a
cure right, shall fail to be cured or corrected within the applicable cure
period.
11.1.5. False Statements. Any representation or warranty of
the Borrower or any Guarantor set forth in this Agreement, the Notes or the
other Loan Documents or in any other certificate, opinion or other statement at
any time provided by or on behalf of the Borrower or any Guarantor in connection
herewith or therewith shall prove to be false or misleading in any material
respect at the time made or given.
11.1.6. Voluntary Insolvency Proceedings. The Borrower, any
Guarantor or any of their respective Subsidiaries (a) shall commence a voluntary
case or other proceeding seeking dissolution, liquidation, reorganization or
other relief with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a receiver, trustee, liquidator, custodian or other similar
official with respect to it or any substantial part of its property, (b) shall
consent to any such relief or to the appointment of, or the taking of possession
of any of its property by, any such official in any involuntary case or other
proceeding commenced against it, (c) shall make a general assignment for the
benefit of creditors, (d) shall take any action to authorize any of the
foregoing, or (e) shall become insolvent or fail generally to pay its debts as
they become due.
11.1.7. Involuntary Insolvency Proceedings. Any involuntary
case or other proceeding shall be commenced against the Borrower, any Guarantor
or any of their respective Subsidiaries seeking dissolution, liquidation,
reorganization or other relief with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a receiver, trustee, liquidator, custodian or other
similar official with respect to it or any substantial part of its property, an
(a) an order for relief (or the equivalent) shall be entered in such involuntary
case or other proceeding or (b) such involuntary case or other proceeding shall
remain undismissed and unstayed for a period of sixty (60) days after the
commencement thereof.
11.1.8. Failure to Perform Other Obligations. The Borrower,
any Guarantor or any of their respective Subsidiaries shall (a) fail to pay any
amount of any Indebtedness or interest thereon, or (b) fail to observe or
perform any term, covenant or agreement contained in any Contractual Obligation
(including Contractual Obligations evidencing, securing or relating to any
Indebtedness) executed by it, which failure (i) would cause or permit the holder
or holders or beneficiary or beneficiaries of such Indebtedness (or any agent or
trustee on their behalf) to cause such Indebtedness to become due or otherwise
payable prior to its stated maturity, so long as the aggregate principal amount
of all such Indebtedness that would then become due or payable would equal or
exceed an amount equal to one percent (1%) of the consolidated assets of the
Borrower and its Subsidiaries, determined in conformity with GAAP, as of the end
of the immediately preceding Fiscal Year, or (ii) would impair the
Administrative Agent's, the Lenders' or the Issuing Bank's rights or the
performance of the obligations of the Borrower, any Guarantor or any of their
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respective Subsidiaries under this Agreement, the Notes or the other Loan
Documents or the business or operations of the Borrower, any Guarantor or any of
their respective Subsidiaries; unless in the case of a Contractual Obligation
that is not for borrowed money, such failure of performance is being contested
by the Borrower, such Guarantor or such Subsidiary in good faith and adequate
reserves with respect thereto have been established on the books of the
Borrower, such Guarantor or such Subsidiary in conformity with GAAP.
11.1.9. Execution or Attachment. Any judgment lien shall be
filed, or any writ of execution, attachment, garnishment or other legal process
shall be issued, against any of the property of the Borrower, any Guarantor or
any of their respective Subsidiaries, which by itself or together with all other
such legal processes is for an amount in excess of an amount equal to one
percent (1%) of the consolidated assets of the Borrower and its Subsidiaries,
determined in conformity with GAAP, as of the end of the immediately preceding
Fiscal Year, and which remains unvacated, unbonded or unstayed for a period of
thirty (30) days or in any event later than five (5) days prior to the date of
any proposed sale thereunder, unless the same is fully covered by insurance
issued by a solvent and reputable insurance company that has not denied or
questioned coverage.
11.1.10. Condemnation of Property. All or substantially all of
the property of the Borrower, any Guarantor or any of their respective
Subsidiaries shall be condemned, seized or otherwise appropriated, and the
condemnation award (together with any net proceeds of insurance then payable in
respect thereof, if any) is materially less than the book value of such property
at the date hereof (if such property was owned by the Borrower or any of its
Subsidiaries on the date hereof) or at the time such property was acquired by
the Borrower or such Subsidiary (if such property was acquired by the Borrower
or such Subsidiary after the date hereof).
11.1.11. Suspension of Business. The Borrower, any Guarantor
or any of their respective Subsidiaries shall voluntarily suspend the
transaction of its business for more than five (5) Business Days in any Fiscal
Year after the date hereof without the prior express written consent of
Requisite Lenders.
11.1.12. ERISA. (a) The Borrower or any Commonly Controlled
Entity shall engage in any "prohibited transaction" (as defined in ERISA or
Section 4975 of the Code) involving any Plan, (b) any "accumulated funding
deficiency" (as defined in ERISA), regardless of whether waived, shall exist
with respect to any Plan, (c) a Reportable Event shall occur with respect to, or
a proceeding shall commence to have a trustee appointed, or a trustee shall be
appointed, to administer or to terminate, any Single Employer Plan, which
Reportable Event or proceeding presents a material risk of termination of such
Plan for purposes of Title IV of ERISA, and, in the case of a Reportable Event,
shall continue unremedied for ten (10) days after notice of such Reportable
Event is given pursuant to Section 4043(a), (c) or (d) of ERISA and, in the case
of such proceeding, shall continue for ten (10) days after commencement thereof,
(d) any Single Employer Plan shall terminate for purposes of Title IV of ERISA,
(e) the withdrawal or partial withdrawal by the Borrower or any Commonly
Controlled Entity from any Multi-Employer Plan, or (f) the reorganization or
insolvency of a Plan or any other event or condition shall occur or exist with
respect to a Plan and in each case in clauses (a) through (f)
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above, such event or condition together with all other such events or
conditions, if any, could subject the Borrower, any Guarantor or any of their
respective Subsidiaries to any tax, penalty or other liability in excess of
$100,000 or otherwise would have a Material Adverse Effect.
11.1.13. Validity of Loan Documents. Any of the Loan Documents
or any provision thereof, for any reason whatsoever, ceases to be binding on the
Borrower, any Guarantor or any of their respective Subsidiaries as is a party
thereto, or the Borrower or any Guarantor shall so assert.
11.1.14. Guaranty Obligations. Any Guarantor shall default in
the performance or observance of its guarantee hereunder, or such guarantee for
any reason whatsoever shall cease to be a valid and binding obligation of any
such Guarantor, or any such Guarantor shall so assert.
11.1.15. Failure of Lien. Any Security Document, after
delivery thereof pursuant to this Agreement, for any reason ceases to create a
valid Lien on any of the Collateral purported to be covered thereby or, after
recordation of such Security Document as provided in this Agreement, ceases to
be a perfected and first priority Lien on such Collateral, subject only to
Permitted Liens.
11.1.16. Defaults under Material Contracts. Any default or
event of default shall occur under any Material Contract, and, if subject to a
cure right, shall fail to be cured or corrected within the applicable cure
period.
11.1.17. Change in Control. An event or series of events shall
occur by which:
(a) any "person" or "group" (within the meaning of
Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934)
shall become the "beneficial owner" (within the meaning of Rule 13d-3
or Rule 13d-5 under the Securities Exchange Act of 1934, except that a
Person shall be deemed to have "beneficial ownership" of all shares
that such Person has the right to acquire without condition, other than
the passage of time, whether such right is exercisable immediately or
only after the passage of time), directly or indirectly, of thirty
percent (30%) or more of the combined voting power of all securities of
the Borrower entitled to vote in the election of directors, other than
securities having such power only by reason of the happening of a
contingency (other than the passage of time), excluding, however, any
such person or group that is a record or "beneficial owner" of any such
securities in any amount on the date of this Agreement; or
(b) Continuing Directors shall cease to constitute a
majority of the members of the board of directors of the Borrower.
11.2. Lenders' Remedies. Upon the occurrence of an Event of Default
or at any time thereafter, and in each and every case, unless such Event of
Default shall have been remedied or waived in writing by Requisite Lenders, any
one or all of the following actions may be taken:
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(a) upon the request of Requisite Lenders, the
Administrative Agent shall, by notice to the Borrower terminate any or
all of the Commitments, whereupon such Commitments of the Lenders
thereunder immediately shall terminate; provided, however, that upon
the occurrence of any event specified in either Section 11.1.6 or
Section 11.1.7 the Commitments shall terminate automatically without
further action by the Administrative Agent, the Lenders or the Issuing
Bank;
(b) upon request of Requisite Lenders, the Administrative
Agent shall declare all outstanding Obligations and other amounts owing
under this Agreement, the Notes and the other Loan Documents to be due
and payable immediately, and all such Obligations and other amounts
immediately shall be due and payable, without presentment, demand,
protest or notice of any kind, all of which are hereby expressly waived
to the extent permitted by applicable law; provided, however, that upon
the occurrence of any event specified in either Section 11.1.6 or
Section 11.1.7 all such Obligations and other amounts immediately shall
be due and payable in full without declaration or other notice;
(c) the Administrative Agent immediately, and without
expiration of any period of grace, may enforce payment of all
Obligations of the Borrower and the Guarantors to the Administrative
Agent and the Lenders under this Agreement, the Notes and the other
Loan Documents, and the Administrative Agent shall be entitled to all
remedies available hereunder or thereunder; and
(d) the Administrative Agent shall be entitled to
exercise, for the ratable benefit of the Lenders, all other rights,
powers, privileges, options and remedies available under or by virtue
of the Loan Documents or otherwise available at law or in equity.
11.3. Actions in Respect of Letters of Credit.
11.3.1. Collateral Account. If an Event of Default shall have
occurred and be continuing, the Administrative Agent may, and upon the request
of Requisite Lenders shall, whether in addition to the taking by the
Administrative Agent of any of the actions described in Section 11.2 or
otherwise, make demand upon the Borrower or any of the Guarantors to, and
forthwith upon such demand such Person(s) will, pay to the Administrative Agent
at its Lending Office, for its benefit and the ratable benefit of the Lenders
and the Issuing Bank, in immediately available (same day) funds for deposit in a
Collateral Account to be maintained for the benefit of the Administrative Agent
and the ratable benefit of the Lenders and the Issuing Bank at such place as
shall be designated by the Administrative Agent, an amount equal to the amount
of the Letter of Credit Liabilities.
11.3.2. Security Interest. The Borrower and the Guarantors
hereby pledge and assign to the Administrative Agent, for its benefit and the
ratable benefit of the Lenders and the Issuing Bank, and grant to the
Administrative Agent for its benefit and the ratable benefit of the
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Lenders and the Issuing Bank, a lien on and a security interest in the
Collateral Account, all cash deposited therein, all notes, certificates and
instruments, if any, from time to time representing or evidencing the Collateral
Account and all interest and other earnings thereon, additions thereto,
substitutions therefor and proceeds thereof. The lien and security interest
granted hereby secures the payment of all of the Obligations.
11.3.3. Application of Proceeds. The Borrower and the
Guarantors hereby authorize the Administrative Agent to apply, from time to time
after funds are deposited in the Collateral Account, funds then held in the
Collateral Account to the payment of any amounts, in such order as the
Administrative Agent may elect, as shall have become or shall become due and
payable by the Borrower to the Lenders in respect of the Letter of Credit
Liabilities and thereafter to the satisfaction of the other Obligations.
11.3.4. Investments. Neither the Borrowers, nor the
Guarantors, nor any Person claiming or acting on behalf of or through the
Borrowers or the Guarantors shall have any right to withdraw any of the funds
held in the Collateral Account, except as provided in Section 11.3.8; provided,
however, that with the consent of the Administrative Agent, and to the extent
that there is an amount in excess of $100,000 in the Collateral Account at the
end of any Business Day after taking into account applications of funds, if any,
from the Collateral Account made pursuant to Section 11.3.8, the Administrative
Agent may, at the written request of the Borrower, from time to time invest
amounts on deposit in the Collateral Account in Cash Equivalents; provided,
further that in order to provide the Administrative Agent with a perfected
security interest therein, each investment in Cash Equivalents shall be
evidenced by negotiable certificates or instruments of which the Administrative
Agent shall take physical possession. If the Borrower or any Guarantor shall
have the right to have any amounts on deposit in the Collateral Account invested
by the Administrative Agent, but shall have failed to request the Administrative
Agent to invest such amounts, the Administrative Agent will endeavor to invest
such amounts in such Cash Equivalents as the Administrative Agent shall select;
provided, however, that in order to provide the Administrative Agent with a
perfected security interest therein, each such investment in Cash Equivalents
shall be evidenced by negotiable certificates or instruments of which the
Administrative Agent shall take physical possession. Any interest or other
proceeds received by the Administrative Agent in respect of Cash Equivalents
that are not invested or reinvested in Cash Equivalents as provided above shall
be deposited and held in cash in the Collateral Account under the sole dominion
and control of the Administrative Agent and shall be applied as provided in
Section 11.3.3.
11.3.5. Further Liens. The Borrower and the Guarantors agree
that they will not sell or otherwise dispose of any interest in the Collateral
Account or the funds on deposit therein or create or permit to exist any Lien on
or with respect to the Collateral Account or the funds on deposit therein except
for the security interest created by this Section 11.3.
11.3.6. Remedies.
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(a) Requisite Lenders may, without notice to the Borrower
or any Guarantor except as required by law and at any time and from
time to time, direct any Lender to charge, set-off and otherwise apply
all or any part of first, the Letter of Credit Liabilities and second,
the other Obligations, against the Collateral Account, or any part
thereof, in such order as the Administrative Agent shall elect. The
Administrative Agent agrees to notify promptly the Borrower or such
Guarantor after any such set-off and application made by any Lender, at
the direction of Requisite Lenders, provided that the failure to give
such notice shall not affect the validity of such set-off and
application. The rights of the Lenders under this Section 11.3.6 are in
addition to other rights and remedies (including other rights of
set-off) which any Lender may have.
(b) The Administrative Agent may exercise, in respect of
the Collateral Account, in addition to the other rights and remedies
provided for herein or otherwise available to it, all the rights and
remedies of a secured party upon default under the UCC, and the
Administrative Agent may, without notice except as specified below,
sell the Collateral or any part thereof in one or more parcels at
public or private sale, at any office of the Administrative Agent or
elsewhere, for cash, on credit or for future delivery, and upon such
other terms as the Administrative Agent may deem commercially
reasonable. The Borrower and the Guarantors agree that to the extent
notice of sale shall be required by law, at least ten (10) days' notice
of the time and place of any public sale or the time after which any
private sale is to be made shall constitute reasonable notice. The
Administrative Agent shall not be obligated to make any sale of the
Collateral or any part thereof, regardless of notice of sale having
been given. The Administrative Agent may adjourn any public or private
sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the
time and place to which it was so adjourned.
(c) Any cash or other property held in the Collateral
Account, and all proceeds received by the Administrative Agent in
respect of any sale of, collection from or other realization upon all
or any part of the Collateral Account may, in the discretion of the
Administrative Agent, then or at any time thereafter be applied (after
payment of any amounts payable pursuant to this Section 11.3) in whole
or in part by the Administrative Agent for the ratable benefit of the
Lenders against all or any part of the Obligations in such order as the
Administrative Agent may elect.
11.3.7. Preservation of the Collateral. The Administrative
Agent shall be deemed to have exercised reasonable care in the custody and
preservation of the Collateral Account if the Collateral Account is accorded
treatment substantially equal to that which the Administrative Agent accords its
own property, it being understood that the Administrative Agent shall not have
any responsibility or liability (a) for ascertaining or taking action with
respect to calls, conversions, exchanges, maturities, tenders or other matters
relative to any Cash Equivalents, regardless of whether the Administrative Agent
has or is deemed to have knowledge of such matters, (b) for taking any necessary
steps to preserve rights against any parties with respect to the Collateral
Account, (c) for the collection of any proceeds from Cash Equivalents,
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(d) by reason of any invalidity, lack of value or uncollectability of any of the
payments received by the Administrative Agent from obligors with respect to Cash
Equivalents, (e) for any loss resulting from investments made in compliance with
Section 11.3.4, except to the extent such loss was attributable to the
Administrative Agent's gross negligence or willful misconduct in complying with
Section 11.3.4, as determined by a final judgment of a court of competent
jurisdiction, or (f) in connection with any investments made in compliance with
Section 11.3.4 without a written request from the Borrower or any Guarantor, or
any failure by the Administrative Agent to make any such investment.
11.3.8. Surplus Funds. Any surplus funds held in the
Collateral Account and remaining after the Obligations are fully satisfied shall
be paid to the Borrower or such other Person(s) as may be lawfully entitled to
receive such surplus.
ARTICLE 12
THE ADMINISTRATIVE AGENT
12.1. Appointment. Each Lender hereby (a) irrevocably appoints Bank
of America as the Administrative Agent for such Lender and the other Lenders
under this Agreement, the Notes and the other Loan Documents, and (b)
irrevocably authorizes the Administrative Agent to take such action on its
behalf under the provisions of this Agreement, the Notes and the other Loan
Documents and to exercise such powers and perform such duties as are expressly
delegated to the Administrative Agent by the terms of this Agreement, the Notes
and the other Loan Documents, together with such other powers as are reasonably
incidental thereto. The Administrative Agent shall, among other things, take
such actions as the Administrative Agent is authorized to take pursuant to this
Agreement, the Notes and the other Loan Documents. As to any matters not
expressly provided for in this Agreement, the Administrative Agent may, but
shall not be required to, exercise any discretion or take any action; however,
the Administrative Agent shall be required to act or to refrain from acting upon
the written instructions of Requisite Lenders if the Administrative Agent shall
be indemnified to its satisfaction by the Lenders against any and all liability
and expense that may be incurred by it by reason of so acting or refraining from
acting. Notwithstanding anything to the contrary herein, the Administrative
Agent shall have no duties, responsibilities or fiduciary relationships with any
Lender except those expressly set forth in this Agreement, the Notes and the
other Loan Documents, and no implied covenants, responsibilities, duties,
obligations or liabilities shall be read into this Agreement, the Notes or the
other Loan Documents or otherwise exist against the Administrative Agent.
12.2. Delegation of Duties. The Administrative Agent may exercise
any of its powers or execute any of its duties under this Agreement, the Notes
and the other Loan Documents by or through one or more agents or
attorneys-in-fact and shall be entitled to obtain, and to rely on, advice of
counsel concerning all matters pertaining to such rights and duties. The
Administrative Agent may utilize the services of such agents and
attorneys-in-fact as the Administrative Agent
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reasonably determines, and all reasonable fees and expenses of such agents and
attorneys-in-fact shall be paid by the Borrower on demand. The Administrative
Agent shall not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by the Administrative Agent in good faith.
12.3. Limitation of Liability. Neither the Administrative Agent nor
its respective officers, directors, employees, agents, attorneys-in-fact or
affiliates shall be (a) liable for any waiver, consent or approval given or any
action taken or omitted to be taken by it or by such Person under or in
connection with this Agreement, the Notes or the other Loan Documents, if
authorized or permitted hereunder, except for its or such Person's own gross
negligence or willful misconduct, or (b) responsible for the consequences of any
oversight or error in judgment by it or such Person whatsoever, except for its
or such Person's own gross negligence or willful misconduct. The Administrative
Agent shall not be responsible for (i) the execution, validity, genuineness,
effectiveness, sufficiency, enforceability, perfection or priority of this
Agreement, the Notes or the other Loan Documents, (ii) the collectability of any
amounts owing under this Agreement, the Notes or the other Loan Documents, (iii)
the value, sufficiency, enforceability, perfection or collectability of any
Collateral, (iv) the failure by the Borrower, any Guarantor or any of their
respective Subsidiaries to perform its obligations under this Agreement, the
Notes or the other Loan Documents or to observe any conditions hereof or
thereof, (v) the truth, accuracy and completeness of the recitals, statements,
representations or warranties made by the Borrower, any Guarantor or any of
their respective Subsidiaries or any officer or agent thereof contained in this
Agreement, the Notes or the other Loan Documents, or in any certificate, report,
statement, document or other writing referred to or provided for in, or received
by the Administrative Agent in connection with, this Agreement, the Notes or the
other Loan Documents believed by the Administrative Agent to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons.
12.4. Reliance by the Administrative Agent. The Administrative Agent
shall not have any obligation (a) to ascertain or to inquire as to the
observance or performance of any of the conditions, covenants or agreements in
this Agreement, the Notes or the other Loan Documents or in any document,
instrument or agreement at any time constituting, or intended to constitute,
Collateral, (b) to ascertain or inquire as to whether any notice, consent,
waiver or request delivered to it shall have been duly authorized or is genuine,
accurate and complete or (c) to inspect the properties, books or records of the
Borrower, any Guarantor or any of their respective Subsidiaries. The
Administrative Agent shall be entitled to rely, and shall be fully protected in
relying (i) upon any note, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, telecopy, telex or teletype message,
statement, order or other document, instrument or conversation believed by it to
be genuine and correct and to have been signed, sent or made by the proper
Person or Persons, and (ii) upon advice and statements of legal counsel
(including counsel to the Borrower or the Guarantors), independent accountants
and other experts selected by the Administrative Agent. The Administrative Agent
may deem and treat the payee of any Note as the owner thereof for all purposes
unless a written notice of the assignment, negotiation or transfer thereof, in
accordance with the provisions of this Agreement, shall have been delivered to
the Administrative Agent identifying the name of the subsequent payee or
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holder thereof. The Administrative Agent shall be entitled to fail or refuse,
and shall be fully protected in failing or refusing, to take any action required
or permitted by it under this Agreement, the Notes or the other Loan Documents
unless (A) it first shall receive such advice or concurrence of Requisite
Lenders as it deems appropriate, or (B) it first shall be indemnified to its
satisfaction by the Lenders against any and all liability and expense that may
be incurred by it by reason of taking or continuing to take any such action. In
all cases the Administrative Agent shall be fully protected in acting, or in
refraining from acting, under this Agreement, the Notes or the other Loan
Documents in accordance with a request of Requisite Lenders, and such request
and any action taken or failure to act pursuant thereto shall be binding upon
all the Lenders and all future holders of the Notes.
12.5. Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default unless the
Administrative Agent has received notice from a Lender, the Borrower or any
Guarantor referring to this Agreement, describing such Default and stating that
such notice is a "Notice of Default." If the Administrative Agent receives such
a notice, the Administrative Agent shall give telephonic and written notice
thereof to the Lenders as soon as is practicable. The Administrative Agent shall
take such action with respect to such Default as shall be reasonably directed by
Requisite Lenders; provided, however, that unless and until the Administrative
Agent shall have received such directions, the Administrative Agent may (but
shall not be obligated to) take such action, or refrain from taking such action,
with respect to such Default as it deems advisable in the best interests of the
Lenders.
12.6. Non-Reliance on the Administrative Agent by the Other Lenders.
Each Lender expressly acknowledges that neither the Administrative Agent nor any
of its officers, directors, employees, agents, attorneys-in-fact or affiliates
has made any representations or warranties to such Lender. The Administrative
Agent shall have no obligation, responsibility or liability to any of the
Lenders regarding the creditworthiness or financial condition of the Borrower,
any of the Guarantors or any of their respective Subsidiaries or for any
recitals, statements, information, representations or warranties herein or in
any document, certificate or other writing delivered in connection herewith or
for the execution, effectiveness, genuineness, validity, enforceability,
perfection, collectability, priority or sufficiency of this Agreement or any
other Loan Document. No act by the Administrative Agent hereinafter taken,
including any review of the Borrower, the Guarantors and their respective
Subsidiaries, shall be deemed to constitute any representation or warranty by
the Administrative Agent to any Lender. Each Lender represents to the
Administrative Agent that, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it has deemed appropriate, it has made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Borrower, the Guarantors and their
respective Subsidiaries and has made its own decision to enter into this
Agreement and to make its Loans and otherwise participate in the transactions
hereunder. Each Lender also represents that, independently and without reliance
upon the Administrative Agent or any other Lender, and based on such documents
and information as it deems appropriate at the time, it shall continue to make
its own credit analysis, appraisals and decisions in taking or not taking action
under this
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Agreement, the Notes and the other Loan Documents and to make such investigation
as it deems necessary to inform itself as to the business, operations, property,
financial and other condition and creditworthiness of the Borrower, the
Guarantors and their respective Subsidiaries. The Administrative Agent shall not
be required to make any inquiry concerning the performance or observance of any
of the terms, provisions or conditions of this Agreement or any other Loan
Document, or the financial condition of the Borrower or the Guarantors or the
existence or possible existence of any Default. Except for notices, reports and
other documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall have no
obligation or liability to provide any Lender with any credit or other
information concerning the business, operations, property, financial and other
condition or creditworthiness of the Borrower, the Guarantors or their
respective Subsidiaries that may come into the possession of the Administrative
Agent or any of its respective officers, directors, employees, agents,
attorneys-in-fact or affiliates.
12.7. Indemnification. Each of the Lenders shall indemnify, defend
and hold harmless the Administrative Agent in its capacity as such (to the
extent not reimbursed by the Borrower and without limiting the obligation of the
Borrower to do so), ratably according to their respective Percentages, from and
against any and all claims, demands, lawsuits, costs, expenses, fees,
liabilities, obligations, losses, damages, actions, recoveries, judgments,
suits, costs, expenses or disbursements of any kind whatsoever, including
interest, penalties and reasonable attorneys' and paralegals' fees and costs and
amounts paid in settlement of any of the foregoing, whether direct, indirect,
consequential or incidental, that at any time (including at any time following
the satisfaction of the Obligations) may be imposed on, incurred by or asserted
against the Administrative Agent in any way relating to, resulting from or
arising out of this Agreement, the Notes or the other Loan Documents, the
transactions contemplated hereby or any action taken or omitted by the
Administrative Agent under or in connection with any of the foregoing; provided,
however, that no Lender shall be liable for the payment of any portion of such
claims, demands, lawsuits, costs, expenses, fees, liabilities, obligations,
losses, damages, actions, remedies, judgments, suits, costs, expenses or
disbursements to the extent such result arose solely from the Administrative
Agent's gross negligence or willful misconduct. The agreements in this Section
12.7 shall survive the repayment of the Loans and the satisfaction of the other
Obligations and shall be in addition to and not in lieu of any other
indemnification agreements set forth in the Loan Documents.
12.8. Payments. If in the opinion of the Administrative Agent, the
distribution of any amount received by the Administrative Agent in such capacity
under this Agreement, the Notes or the other Loan Documents might involve it in
liability, the Administrative Agent may refrain from making the distribution
thereof until the Administrative Agent's right to make such distribution shall
have been adjudicated by a court of competent jurisdiction. If a court of
competent jurisdiction shall adjudge that any amount received from and
distributed by the Administrative Agent in such capacity as Administrative Agent
is to be repaid, each Person to whom any such distribution shall have been made
either (a) shall repay to the Administrative Agent its proportionate share of
the amount so adjudged to be repaid, or (b) shall repay the same in such manner
and to such Persons as shall be determined by such court.
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12.9. Administrative Agent in Its Individual Capacity. The
Administrative Agent in its individual capacity, and its Affiliates, may make
loans and other financial accommodations to, accept deposits from and generally
engage in any kind of business with the Borrower or any of the Guarantors and
their respective Subsidiaries as though the Administrative Agent were not the
Administrative Agent hereunder. With respect to Loans made or renewed by it, any
Notes issued to it and its participation in the Letter of Credit Liabilities,
the Administrative Agent in its individual capacity shall have the same
benefits, rights, powers and privileges under this Agreement, the Notes and the
other Loan Documents as any other Lender and may exercise the same as though it
were not the Administrative Agent, and the terms "Lender", "Lenders" and
"Requisite Lenders" shall include the Administrative Agent in its individual
capacity.
12.10. Successor Administrative Agent. The Administrative Agent may
resign as such upon thirty (30) days' prior written notice to the Lenders. If
the Administrative Agent shall resign as such under this Agreement, then
Requisite Lenders shall appoint from among the Lenders a successor agent for the
Lenders, which successor agent shall be reasonably acceptable to the Borrower;
provided, however, that acceptability to the Borrower shall not be required if a
Default has occurred and is continuing. Upon acceptance of its appointment as
successor agent, (a) such successor agent shall succeed to the rights, powers,
privileges and duties of the Administrative Agent, (b) the retiring
Administrative Agent shall be discharged of all its obligations and liabilities
in such capacity under this Agreement, the Notes and the other Loan Documents,
(c) the term "Administrative Agent" shall mean such successor agent effective
upon its appointment and (d) the retiring Administrative Agent's rights, powers
and duties as Administrative Agent shall be terminated, without any other or
further act or deed on the part of such retiring Administrative Agent or any of
the parties to this Agreement or any holders of the Notes. After any retiring
Administrative Agent's resignation hereunder as Administrative Agent, the
provisions of this Article 12 shall continue to inure to its benefit as to any
actions taken or omitted to be taken by it while it was Administrative Agent
under this Agreement.
12.11. Co-Agents. Notwithstanding any provision of this Agreement or
any of the other Loan Documents that may be to the contrary, neither Co-Agent,
in its capacity as such, shall have any right, power, privilege, duty,
obligation, responsibility or liability pursuant to this Agreement or any of the
other Loan Documents.
ARTICLE 13
ASSIGNMENTS AND PARTICIPATIONS
13.1. Successors and Assigns. This Agreement, the Notes and the
other Loan Documents shall be binding on and shall inure to the benefit of the
Borrower, the Guarantors, the Administrative Agent, the Lenders, the Issuing
Bank and their respective successors and assigns, except as otherwise provided
herein or therein. Neither the Borrower nor the Guarantors may assign, transfer,
hypothecate or otherwise convey their respective rights, benefits, obligations
or
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duties hereunder or thereunder without the prior express written consent of the
Lenders. Any purported assignment, transfer, hypothecation or other conveyance
by the Borrower or the Guarantors without the prior express written consent of
all the Lenders shall be void. Neither the Administrative Agent nor any of the
Lenders may sell, assign, transfer, grant a participation in or otherwise
dispose of all or any portion of its interest in this Agreement, the Notes or
the other Loan Documents except as expressly provided herein.
13.2. Assignments.
13.2.1. Assignments. With prior notice to the Borrower, each
Lender may assign (other than the sale of a participation) up to one hundred
percent (100%) of its right, title and interest under this Agreement, the Notes,
the Letters of Credit and the other Loan Documents (including all or a portion
of its Commitments and the same portion of the Loans at the time owing to it) to
one or more banks or other financial institutions reasonably satisfactory to the
Administrative Agent and the Issuing Bank; provided, however, that (a) each such
assignment shall be of a constant, and not a varying, percentage of all such
Lender's right, title and interest hereunder and thereunder, (b) such share
equals no less than $5,000,000 in the case of any one assignee, (c) any assignee
shall execute and deliver to the Administrative Agent an Assignment and
Acceptance, (d) the assigning Lender shall pay to the Administrative Agent a
transfer fee in the amount of $3,500, and (e) a Lender may not assign any
interest without the prior approval of the Administrative Agent, the Issuing
Bank and, in the absence of a Default, the Borrower, which approval shall not be
unreasonably withheld. Notwithstanding the foregoing, any Lender may assign, as
collateral or otherwise, any of its rights (including such Lender's rights to
payments of principal or interest on the Notes) under this Agreement to any
Federal Reserve Bank without notice to or consent of the Administrative Agent,
the Issuing Bank or the Borrower.
13.2.2. Effect of Assignments. Upon the sale, assignment,
transfer or other disposition (other than the sale of a participation) of any of
a Lender's right, title and interest under this Agreement, the Notes, the
Letters of Credit and the other Loan Documents to any assignee in accordance
with this Section 13.2, then upon the execution, delivery and acceptance of the
Assignment and Acceptance, from and after the effective date specified therein,
(a) the transferor Lender no longer shall have the rights, benefits and
obligations under this Agreement, the Notes, the Letters of Credit or the other
Loan Documents to the extent of the interest transferred (except for such
rights, benefits and obligations that such Lender would retain under or with
respect to this Agreement, the Notes, the Letters of Credit or the other Loan
Documents upon payment in full of the Obligations), and (b) the assignee shall
become a Lender, shall succeed to the rights and benefits and assume the
obligations of such transferor Lender hereunder and thereunder to the extent of
the interest transferred.
13.2.3. Actions by the Borrower. The Borrower hereby agrees
that it shall execute and deliver, at the request of the Administrative Agent
(a) one or more substitute Notes to the order of such Lenders to evidence the
portions of the Loans retained and sold and (b) any amendment to any Loan
Document to effectuate the provisions of this Section 13.2.
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13.3. Participations. Subject to the provisions of this Section
13.3, each Lender shall have the right at any time to sell undivided
participating interests in all or any part of its Commitments, the Loans and the
Letters of Credit to one or more banks or other financial institutions;
provided, however, that (a) such sale or transfer shall not relieve such Lender
of any obligation or liability hereunder, (b) such Lender shall make and receive
all payments for the account of its participants and shall retain exclusively,
and shall continue to exercise exclusively, all rights of approval and
administration available hereunder with respect to such Lender's Commitments,
the Loans and the Letters of Credit, even after giving effect to the sale of any
such participation (although such Lender may at its option agree with its
participants that it will not consent to any matter described in clauses (a)
through (f) of Section 14.3.4 without their concurrence), and (c) such Lender
shall make such arrangements with its participants as may be necessary to
accomplish the foregoing. No such participant shall be a Lender for any purpose
of this Agreement, other than for purposes of Section 14.13, without the consent
of the Administrative Agent and the Issuing Bank.
13.4. Disclosure. In connection with any assignments, participations
or offers therefor pursuant to this Article 13, each Lender may disclose to any
assignee or participant or prospective assignee or participant such information
pertaining to the Borrower, the Guarantors or any of their respective
Subsidiaries as such Lender may deem appropriate or such assignee or participant
or prospective assignee or participant may request; provided, however, that
prior to any such disclosure such assignee or participant or prospective
assignee or participant shall agree to preserve the confidentiality of any
confidential information relating to the Borrower or its Subsidiaries received
by it on the same basis as provided in this Section 13.4.
13.5. Assignments and Participations as Units. No Lender shall
assign or sell any participation in its Commitments, the Loans or the Letters of
Credit, except in the form of units consisting of pro rata interests in its
Commitments, the Loans and the Letters of Credit.
ARTICLE 14
GENERAL PROVISIONS
14.1. Notices. Any notice, request, demand or other communication
required or permitted under this Agreement, the Notes or the other Loan
Documents shall be in writing and shall be deemed to be properly given (a) when
received, if personally delivered or sent by overnight courier with appropriate
confirmation of delivery, (b) two (2) Business Days after deposit in the mail,
if mailed by United States first class, certified or registered mail, postage
prepaid, (c) one (1) Business Day after deposit with a public telegraph company
for transmittal, charges prepaid, or (d) when received, if given by telecopy,
with appropriate confirmation, each to the appropriate address set forth below
or to such other address that any such party or the Administrative Agent may
designate by written notice to the other parties.
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If to the Borrower:
America Service Group Inc.
▇▇▇▇▇ ▇▇▇
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▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Treasurer
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
America Service Group Inc.
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: General Counsel
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
If to any of the Guarantors:
c/o America Service Group Inc.
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▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Treasurer
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
America Service Group Inc.
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▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: General Counsel
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
If to any of the Lenders:
Their respective addresses as set forth with their
signatures on this Agreement.
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If to Bank of America as Administrative Agent:
Bank of America, N.A.
Agency Services (NC1-001-15-04)
15th Floor, One Independence Center
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Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Bank of America, N.A.
Healthcare Banking Group (TN1-100-04-17)
▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
If to Bank of America as Issuing Bank:
Bank of America, N.A.
Agency Services (NC1-001-15-04)
15th Floor, One Independence Center
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▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Bank of America, N.A.
Healthcare Banking Group (TN1-100-04-17)
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▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
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14.2. Entire Agreement. The execution and delivery of this Agreement
and the other Loan Documents supersede all the negotiations or stipulations
concerning the matters that preceded or accompanied the execution and delivery
hereof and thereof (other than with respect to fees payable pursuant to separate
agreements among the Borrower, the Administrative Agent and the Issuing Bank).
This Agreement, the Notes and the other Loan Documents also are intended, by the
parties hereto and thereto, as a complete and exclusive statement of the terms
and conditions hereof and thereof.
14.3. Amendments, Waivers and Consents.
14.3.1. Amendments. Except as otherwise set forth in this
Agreement, the provisions of (a) this Agreement may not be modified, amended,
restated or supplemented, except by a written instrument duly executed and
delivered on behalf of the Borrower, the Guarantors and Requisite Lenders, and
(b) the Notes and all Loan Documents other than this Agreement may not be
modified, amended, restated or supplemented, except by a written instrument duly
executed and delivered on behalf of the Borrower and any of the Guarantors, to
the extent that the Borrower or any such Guarantor is a signatory party to such
Note or such Loan Document, and on behalf of the Administrative Agent, with the
written consent of Requisite Lenders. Notwithstanding anything to the contrary
herein, the Administrative Agent and Requisite Lenders may modify, amend,
restate, supplement or waive any provision of Article 12 without the consent of
the Borrower or any Guarantor; provided, however, that the requirement of
Section 12.10 that a successor agent be reasonably acceptable to the Borrower
may not be modified without the written consent of the Borrower.
14.3.2. Waivers and Consents. Except as otherwise set forth
in this Agreement, any waiver of the terms and conditions of this Agreement, the
Notes or the other Loan Documents, or any waiver of any Default or Event of
Default and its consequences hereunder or thereunder, and any consent or
approval required or permitted by this Agreement, the Notes or the other Loan
Documents to be given by the Lenders, may be made or given with, but only with,
the written consent of Requisite Lenders on such terms and conditions as
specified in the written instrument granting such waiver, consent or approval. A
waiver, to be effective, must be in writing and signed by the party making the
waiver.
14.3.3. Effect of Waivers. In the case of any waiver, the
Borrower, the Guarantors, the Lenders and the Administrative Agent shall be
restored to their former positions and rights under this Agreement, the Notes
and the other Loan Documents to the extent of such waiver, and any Default or
Event of Default waived shall be deemed to be cured and not continued; provided,
however, that no waiver shall constitute the waiver of any subsequent or other
Default or Event of Default or impair any right consequent thereon. No failure
or delay on the part of the Administrative Agent or any Lender to exercise or
enforce any right or remedy under or in connection with this Agreement, the
Notes or the other Loan Documents, whether by their respective terms, at law, in
equity or otherwise, shall operate as a waiver thereof. No single or partial
exercise of any such right or remedy shall preclude other or further exercise
thereof or the exercise of any other right or remedy.
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14.3.4. Consent of the Lenders. Without in each instance the
prior express written consent of the Administrative Agent and each Lender
affected thereby, no such modification, amendment, restatement, supplement,
waiver or consent shall:
(a) increase the Commitment of any Lender without such
Lender's approval;
(b) reduce the amounts or extend the dates for the
payment of any Credit Fees that are payable ratably to all of the
Lenders in accordance with their respective Percentages of the
Commitments;
(c) extend the maturity of the Notes or reduce the
amounts or extend the dates of any scheduled principal payments or
mandatory prepayments hereunder or thereunder;
(d) reduce the rate or extend the time of payment of
interest hereunder or under the Notes;
(e) waive the payment of any principal, interest or
Credit Fees payable hereunder or under the Notes;
(f) extend the termination dates of any of the
Commitments or the Maturity Date except as expressly provided for in
this Agreement;
(g) consent to the assignment or transfer by the Borrower
of any of its Obligations under this Agreement, the Notes or the other
Loan Documents;
(h) release a material portion of the Collateral or
release any of the guarantees hereunder, except as expressly provided
herein; or
(i) amend or modify the definitions of "Percentages" or
"Requisite Lenders" contained in this Agreement.
14.3.5. Binding Effect. Any such modification, amendment,
restatement, supplement, waiver or consent shall apply equally to each of the
Lenders and shall be binding upon the Borrower, the Guarantors, the Lenders, the
Administrative Agent and all future holders of the Notes.
14.4. Independence of Covenants. All covenants hereunder shall be
given independent effect so that if a particular action or condition is not
permitted by any of such covenants, the fact that it would be permitted by an
exception to, or otherwise would be within the limitations of, another covenant
shall not avoid the occurrence of a Default or an Event of Default if such
action is taken or condition exists.
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14.5. Interpretation. Neither this Agreement, the Notes or the other
Loan Documents, nor any uncertainty or ambiguity herein or therein, shall be
construed or resolved against the Administrative Agent, the Lenders, the Issuing
Bank, the Borrower or the Guarantors whether under any rule of construction or
otherwise. This Agreement, the Notes and the other Loan Documents have been
reviewed by all the parties hereto and thereto and shall be construed and
interpreted according to the ordinary meaning of the words used as to accomplish
fairly the purposes and intentions of all such parties.
14.6. Inconsistencies With Other Documents. In the event there is a
conflict or inconsistency between this Agreement, the Notes or the other Loan
Documents, the terms of this Agreement shall control; provided, however, that
any provision of the Security Documents that imposes additional burdens on the
Borrower or any Guarantor or further restricts the rights of the Borrower or any
Guarantor or gives the Lenders additional rights shall not be deemed to be in
conflict or inconsistent with this Agreement and shall be given full force and
effect.
14.7. Severability. If any portion of this Agreement, the Notes or
any of the other Loan Documents shall be judged by a court of competent
jurisdiction to be unenforceable, the remaining portions shall be valid and
enforceable to the extent that the remaining terms thereof provide for the
creation of the Obligations and the consummation of the issuance of the Notes,
the grant of collateral security therefor, the guarantee thereof and the payment
of principal and interest in respect of the Obligations substantially on the
same terms and subject to the same conditions as set forth herein and therein.
14.8. Governing Law. This Agreement, the Notes and the other Loan
Documents, unless otherwise expressly set forth therein, shall be governed by,
construed and enforced in accordance with the laws of the State of Tennessee,
without reference to the conflicts or choice of law principles thereof, except
to the extent that the laws of a particular jurisdiction govern the creation,
perfection, priority and enforcement of liens on and security interests in the
Collateral. Notwithstanding the foregoing, if at any time the laws of the United
States of America permit any Lender to contract for, take, reserve, charge or
receive interest or loan charges in amounts greater than are allowed by the laws
of such state (whether such federal laws directly so provide or refer to the law
of the state where such Lender is located), then such federal laws shall to such
extent govern as to the interest and loan charges that such Lender is allowed to
contract for, take, reserve, charge or receive under this Agreement, the Notes
and the other Loan Documents. References to laws in this section are to such
laws as are now in effect, and, with respect to usury laws, if any, applicable
to any Lender and to the extent allowed thereby, to such laws as hereafter may
be in effect that allow a higher maximum nonusurious interest rate than such
laws now allow.
14.9. CONSENT TO JURISDICTION. THE BORROWER AND EACH GUARANTOR
HEREBY IRREVOCABLY CONSENT TO THE PERSONAL JURISDICTION OF THE STATE AND FEDERAL
COURTS LOCATED IN DAVIDSON COUNTY, TENNESSEE IN ANY ACTION, CLAIM OR OTHER
PROCEEDING ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS AGREEMENT, THE
NOTES AND THE
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OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER OR THE
PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS. THE BORROWER AND EACH GUARANTOR
HEREBY IRREVOCABLY CONSENT TO THE SERVICE OF A SUMMONS AND COMPLAINT AND OTHER
PROCESS IN ANY ACTION, CLAIM OR PROCEEDING BROUGHT BY THE ADMINISTRATIVE AGENT,
ANY LENDER OR THE ISSUING BANK IN CONNECTION WITH THIS AGREEMENT, THE NOTES OR
THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER OR
THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS, ON BEHALF OF ITSELF OR ITS
PROPERTY, IN THE MANNER SPECIFIED IN SECTION 14.1. NOTHING IN THIS SECTION 14.9
SHALL AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENT, ANY LENDER OR THE ISSUING
BANK TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT THE
RIGHT OF THE ADMINISTRATIVE AGENT, ANY LENDER OR THE ISSUING BANK TO BRING ANY
ACTION OR PROCEEDING AGAINST THE BORROWER, ANY OF THE GUARANTORS OR THEIR
RESPECTIVE PROPERTIES IN THE COURTS OF ANY OTHER JURISDICTIONS.
14.10. WAIVER OF JURY TRIAL. THE ADMINISTRATIVE AGENT, EACH LENDER,
THE ISSUING BANK, THE BORROWER AND EACH GUARANTOR HEREBY IRREVOCABLY WAIVE THEIR
RESPECTIVE RIGHTS TO A JURY TRIAL WITH RESPECT TO ANY ACTION, CLAIM,
COUNTERCLAIM OR OTHER PROCEEDING ARISING OUT OF ANY DISPUTE IN CONNECTION WITH
THIS AGREEMENT, THE NOTES OR THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS
HEREUNDER OR THEREUNDER OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS. The
scope of this waiver is intended to be all-encompassing with respect to any and
all disputes that may be filed in any court and that relate to the subject
matter of this transaction, including without limitation contract claims, tort
claims, breach of duty claims and all other common law and statutory claims.
Each of the parties hereto (a) acknowledges that this waiver is a material
inducement for the parties to the Loan Documents to enter into a business
relationship, that the parties to the Loan Documents have already relied on this
waiver in entering into same and the transactions that are the subject thereof,
and that they will continue to rely on this waiver in their related future
dealings, and (b) further warrants and represents that each has reviewed this
waiver with its legal counsel and that each knowingly and voluntarily waives its
jury trial rights following consultation with legal counsel. This waiver is
irrevocable, meaning that it may not be modified either orally or in writing,
and this waiver shall apply to any subsequent amendments, modifications,
supplements, extensions, renewals or replacements of this Agreement. In the
event of litigation, this Agreement may be filed as a written consent to a trial
by the court.
14.11. Cumulative Remedies. All rights and remedies provided in or
contemplated by this Agreement, the Notes and the other Loan Documents are
cumulative and not exclusive of any right or remedy otherwise provide herein,
therein, at law or in equity.
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14.12. Expenses of Administration and Enforcement. The Borrower shall
pay on demand all reasonable expenses of the Administrative Agent in connection
with this Agreement, the Notes and the other Loan Documents, and the preparation
of any modifications, amendments, restatements, supplements or waivers,
including all attorneys' and paralegals' fees and expenses, all fees and
expenses for title, lien and other public records searches, filing and
recordation fees and taxes, duplicating expenses, corporation search fees,
appraisal fees, escrow agent fees and expenses, and all other customary
expenses. If there shall occur a Default or Event of Default, all reasonable
out-of-pocket expenses incurred by the Lenders and the Administrative Agent
(including administrative expenses of the Administrative Agent and the Lenders
and fees and disbursements of in-house and outside counsel) in connection with
such Default or Event of Default and collection and other enforcement
proceedings (including bankruptcy proceedings) resulting therefrom shall be paid
by the Borrower, regardless of whether suit is actually commenced to obtain any
relief provided hereunder. The Borrower shall indemnify, defend and hold
harmless the Administrative Agent, each of the Lenders and the Issuing Bank from
and against any and all documentary or filing taxes, assessments or charges by
any Governmental Authority by reason of the execution and delivery of this
Agreement, the Notes and the other Loan Documents and the consummation of the
transactions that are the subject thereof.
14.13. Indemnification. The Borrower and each of the Guarantors,
jointly and severally, shall indemnify, defend and hold harmless the
Administrative Agent, the Lenders and the Issuing Bank (to the fullest extent
permitted by law) from and against any and all claims, demands, lawsuits, costs,
expenses, fees, obligations, liabilities, losses, damages, recoveries and
deficiencies, including interest, penalties and reasonable attorneys' and
paralegals' fees and costs and amounts paid in settlement of any of the
foregoing, whether direct, indirect, consequential or incidental, that the
Administrative Agent, the Lenders or the Issuing Bank may incur or suffer or
that may arise out of, result from or relate to (a) this Agreement, the Notes,
the Letters of Credit or the other Loan Documents or the transactions
contemplated hereby or thereby (excluding actions arising out of the
Administrative Agent's, the Lenders' or the Issuing Bank's own gross negligence
or willful misconduct and actions arising out of claims made by the
Administrative Agent, any Lender or the Issuing Bank against any of the others),
or (b) any action under this Agreement, the Notes, the Letters of Credit or the
other Loan Documents or the transactions contemplated hereby or thereby
(excluding actions arising out of the Administrative Agent's, the Lenders' or
the Issuing Bank's own gross negligence or willful misconduct and actions
arising out of claims made by the Administrative Agent, any Lender or the
Issuing Bank against any of the others). In no event shall the Administrative
Agent, any Lender or the Issuing Bank be liable to the Borrower or any of the
Guarantors for any matter or thing in connection with this Agreement, the Notes,
the Letters of Credit or the other Loan Documents other than to account for
monies actually received by them in accordance with the terms hereof. This
Section 14.13 shall survive termination of this Agreement.
14.14. Adjustment. If any Lender (a "benefitted Lender") at any time
shall receive any payment of all or part of its Revolving Loans or its
participation in the Letter of Credit Liabilities or the interest thereon or
receive any collateral therefor, whether voluntarily or involuntarily, by
set-off or otherwise, in a greater portion of any such payment to and collateral
received by any
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other Lender, if any, in respect of such other Lender's Revolving Loans or its
participation in the Letter of Credit Liabilities or the interest thereon, such
benefitted Lender shall purchase for cash from the other Lenders such portion of
each Lender's Revolving Loan and participation in the Letter of Credit
Obligations, or shall provide such other Lenders with the benefits of any such
collateral, or the proceeds thereof, as shall be necessary to cause such
benefitted Lender to share the excess payment or benefits of such collateral or
proceeds ratably with each of the Lenders; provided, however, that if all or any
portion of such excess payment or benefits thereafter is recovered from such
benefitted Lender or set aside, such purchase shall be rescinded and the
purchase price and benefit returned to the extent of such recovery, but without
interest. Each Lender so purchasing a portion of another Lenders' Revolving Loan
and participation in the Letter of Credit Obligations may exercise all rights of
payment (including rights of setoff) with respect to such portion as fully as if
such Lender were the direct holder of such portion.
14.15. Setoff. In addition to any rights and remedies of the Lenders
provided by law, the Lenders each shall have a security interest in any and all
deposits of the Borrower and the Guarantors (general or special, time or demand,
provisional or final) at any time held by any Lender or any Affiliate thereof,
which security interest shall secure the Obligations. Upon the occurrence and
during the continuance of any Event of Default, with the consent of the
Administrative Agent without prior notice to the Borrower or the Guarantors, any
notice being specifically waived by the Borrower and the Guarantors to the
fullest extent permitted by applicable law, each Lender may set off and apply
against any indebtedness, whether matured or unmatured, of the Borrower or any
Guarantor to the Lenders, any amount owing from any Lender or any Affiliate
thereof to the Borrower or any Guarantor at, or at any time after, the
occurrence of an Event of Default (and each Affiliate of any Lender is
irrevocably authorized to permit such setoff and application), and the aforesaid
right of setoff may be exercised by any Lender against the Borrower or the
Guarantors or against any trustee in bankruptcy, debtor in possession, assignee
for the benefit of creditors, receiver or execution, judgment, or attachment
creditor of the Borrower or any Guarantor, or against anyone else claiming
through or against the Borrower or any such Guarantor or such trustee in
bankruptcy, debtor in possession, assignee for the benefit of creditors,
receiver or execution, judgment or other attachment creditor, notwithstanding
the fact that such right of setoff shall not have been exercised by any Lender
prior to the making, filing or issuance, or service upon any Lender of, or of
notice of, any such petition, assignment for the benefit of creditors,
appointment or application for the appointment of a receiver, or issuance of
execution, subpoena, order or warrant. Each Lender promptly shall notify the
Borrower or the Guarantors and the Administrative Agent after any such setoff
and application made by any Lender; provided, however, that failure to give such
notice shall not affect the validity of such setoff and application.
14.16. Other Accommodations to the Borrower and the Guarantors; No
Rights By Virtue of Cross-Collateralization.
(a) Each Lender (including the Administrative Agent) may,
without notice to or consent by any other Lender, make or participate
in loans, extensions of credit or other financial accommodations to or
for the benefit of the Borrower or any of its Subsidiaries
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on any terms that it deems desirable, and engage in other business
transactions, in the same manner as if this Agreement were not in
existence, all without limiting, waiving or otherwise impairing any
rights of such Lender or any other Lender under this Agreement. Without
limiting the generality of the foregoing, the Lenders acknowledge and
agree that so long as a Lender acts in good faith and the other
Lenders' interests in the Obligations and the Collateral are not
impaired thereby, (i) such Lender may be preferred or secured in any
manner that it deems advisable with respect to such other loans,
extensions of credit, financial accommodations and transactions, (ii)
such Lender shall be under no obligation to collect or attempt to
collect any payments in respect of the Obligations in preference to the
collection or enforcement of any other borrowings or obligations of the
Borrower or its Subsidiaries to such Lender, and (iii) any amounts
collected by such Lender from the Borrower or its Subsidiaries that are
not expressly designated (or reasonably determinable to be intended) as
being in payment of the Obligations may be applied to any of the
obligations of such Person to such Lender in any manner deemed
appropriate by such Lender.
(b) The Lenders acknowledge and agree that the Collateral
constitutes all of the collateral security for the Obligations and
that, as among themselves, no Lender shall have any interest in (i) any
property or interests of the Borrower or any of its Subsidiaries, other
than the Collateral, that now or hereafter secures loans, extensions of
credit, other financial accommodations and other transactions
(excluding the Obligations), of the Borrower or any of its Subsidiaries
with any other Lender, whether entered into directly or acquired by
such Lender, (ii) any property of the Borrower or any of its
Subsidiaries, other than the Collateral, now or hereafter in the
possession or control of any other Lender, (iii) any deposit, not
constituting Collateral, now or hereafter held by any other Lender, or
(iv) any other indebtedness now or hereafter owing to any other Lender;
any of which may be or become security for or otherwise available for
payment or performance of the Obligations by reason of any
cross-collateralization or any general description of secured
indebtedness(es) or obligation(s) contained in any mortgage, security
agreement or other security instrument or agreement held by any Lender,
or by reason of the right of setoff, counterclaim or otherwise.
Notwithstanding the foregoing, if any such property, deposit or
indebtedness, or any proceeds thereof, in the discretion of the Lender
holding same, is applied to the reduction of the Obligations, then all
of the Lenders shall be entitled to their respective Percentages of
such application in the manner provided in Sections 3.3 and 14.14.
14.17. Survival of Representations and Warranties. All
representations and warranties of the Borrower and the Guarantors set forth in
this Agreement, the Notes and the other Loan Documents and in any other
certificate, opinion or other statement provided at any time by or on behalf of
the Borrower and the Guarantors in connection herewith shall survive the
execution of the delivery of this Agreement, the Notes and the other Loan
Documents, the purchase and sale of the Notes hereunder and the payment or other
satisfaction of the Obligations.
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14.18. Relationship of the Parties. None of the Administrative Agent,
the Lenders or the Issuing Bank shall be deemed partners or joint venturers with
the Borrower or the Guarantors or any Affiliate thereof in making this Agreement
or by any action taken hereunder. The Borrower and the Guarantors, jointly and
severally, shall indemnify, defend and hold harmless the Lenders and the
Administrative Agent from and against any and all claims, demands, lawsuits,
costs, expenses, fees, obligations, liabilities, losses, damages, recoveries and
deficiencies, including interest, penalties and reasonable attorneys' fees and
costs, whether direct, indirect, consequential or incidental, that the Lenders
or the Administrative Agent may incur or suffer or that may arise out of, result
from or relate to such a construction of the parties and their relationship.
This Section 14.18 shall survive termination of this Agreement.
14.19. Destruction of Records. Any documents, schedules, invoices or
other papers delivered to the Administrative Agent, the Lenders or the Issuing
Bank, excluding stock certificates, promissory notes and similar instruments
evidencing Collateral, at their option may be destroyed or otherwise disposed of
by them six (6) months after they are delivered to or received by them, unless
the Borrower or any Guarantor requests, in writing, the return of such
documents, schedules, invoices or other papers and makes reasonably acceptable
arrangements, at the Borrower's or such Guarantor's expense, for their return.
14.20. Execution in Counterparts; Effectiveness.
(a) This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original hereof for all
purposes, but all of which together shall constitute one and the same
document. One or more counterparts of this Agreement may be executed by
one or more of the parties hereto, and some different counterparts or
copies executed by other parties. Each counterpart hereof executed by
any party hereto shall be binding upon the party executing same even
though other parties may execute one or more different counterparts,
and all counterparts hereof so executed shall constitute but one and
the same agreement. Each party hereto, by execution of a counterpart
hereof, expressly authorizes and directs any other party hereto to
detach the signature pages (and any corresponding acknowledgment pages)
thereof from the counterpart hereof executed by the authorizing party
and affix same to another identical counterpart hereof such that upon
execution of multiple counterparts hereof by all parties hereto, there
shall be one counterpart hereof to which is attached the signature
pages (and any corresponding acknowledgment pages) containing
signatures (and acknowledgments) of all parties hereto.
(b) This Agreement shall become effective when (i) the
Administrative Agent shall have received counterparts or signature
pages executed by the Borrower, the Guarantors, the Administrative
Agent, the Co-Agents, the Lenders and the Issuing Bank, or (ii) in the
case of any Lender or Co-Agent, the Administrative Agent shall have
received telecopied notice from such Lender that it has executed a
counterpart hereof or signature page hereto and forwarded the same to
the Administrative Agent by first class, registered or certified mail
as set forth in Section 14.1. A set of the copies of this
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110
Agreement or counterparts signed by all of the parties shall be lodged
with the Borrower, on behalf of itself and the Guarantors, and the
Administrative Agent.
14.21. Interest and Loan Charges Not to Exceed Maximum Amounts
Allowed by Law. It is the intention of the Borrower and the Lenders to conform
strictly to all laws applicable to the Lenders that govern or limit the interest
and loan charges that may be charged in respect of the Obligations. Anything in
this Agreement, the Notes or any of the other Loan Documents to the contrary
notwithstanding, in no event whatsoever, whether by reason of advancement of
proceeds of the Loans or the Letters of Credit, acceleration of the maturity of
the unpaid balance of any of the Obligations or otherwise, shall the interest
and loan charges agreed to be paid to any of the Lenders for the use of the
money advanced or to be advanced hereunder exceed the maximum amounts
collectible by such Lender pursuant to applicable law. If for any reason
whatsoever the interest or loan charges paid or contracted to be paid by the
Borrower to any of the Lenders in respect of the Obligations shall exceed the
maximum amounts collectible under the law applicable to such Lender, then, in
that event, and notwithstanding anything to the contrary in this Agreement, the
Notes or any other Loan Document: (a) the aggregate of all consideration that
constitutes interest or loan charges under the law applicable to such Lender
that is contracted for, taken, reserved, charged or received under this
Agreement, the Notes or any other Loan Document or otherwise in connection with
the Obligations under no circumstances shall exceed the maximum amounts allowed
by such applicable law, and any excess shall be credited by such Lender on the
principal amount of the Obligations (or, to the extent the principal amount
outstanding under this Agreement, the Notes and the other Loan Documents has
been or thereby would be paid in full, refunded to the Borrower); and (b) in the
event that the maturity of any or all of the Obligations is accelerated by
reason of an election of the Lenders resulting from any Default under this
Agreement or otherwise, or in the event of any required or permitted prepayment,
then such consideration that constitutes interest or loan charges under the law
applicable to any Lender may never include more than the maximum amounts allowed
by the law applicable to such Lender, and any excess interest or loan charges
provided for in this Agreement or otherwise shall be canceled automatically as
of the date of such acceleration or prepayment and, if theretofore paid, shall
be credited by such Lender on the principal amount of the Obligations (or, to
the extent the principal amount of the Obligations has been or thereby would be
paid in full, refunded by such Lender to the Borrower). All sums paid or agreed
to be paid to the Lenders for the use, forbearance or detention of sums due
hereunder shall, to the extent permitted by applicable law, be prorated,
allocated and spread throughout the full term of the Obligations until payment
in full so that the rate or amount of interest and loan charges on account of
the Obligations will not exceed any applicable legal limitation. The right to
accelerate the maturity of the Obligations does not include the right to
accelerate the maturity of any interest or loan charges not otherwise accrued on
the date of such acceleration, and the Lenders do not intend to charge or
collect any unearned interest or loan charges in the event of any such
acceleration.
14.22. Amended and Restated Agreement. This Agreement amends,
restates, supersedes and replaces the Previous Credit Agreement and the Overline
Agreement.
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111
14.23. Final Agreement. This written agreement represents the final
agreement between the parties and may not be contradicted by evidence of prior,
contemporaneous or subsequent oral agreements of the parties. There are no
unwritten oral agreements between the parties.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the date first written above.
BORROWER:
AMERICA SERVICE GROUP INC.
a Delaware corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇, Executive Vice President
and Chief Financial Officer
GUARANTORS:
PRISON HEALTH SERVICES, INC.
a Delaware corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇, Executive Vice President
and Treasurer
PRISON HEALTH SERVICES OF INDIANA, L.L.C.
an Indiana limited liability company
BY: PRISON HEALTH SERVICES, INC.
a Delaware corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇, Executive Vice
President and Treasurer
Being the duly authorized General Manager
thereof.
-110-
112
EMSA GOVERNMENT SERVICES, INC.
a Florida corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇, Executive Vice President
and Treasurer
EMSA CORRECTIONAL CARE, INC.
a Florida corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇, Executive Vice President
and Treasurer
EMSA MILITARY SERVICES, INC.
a Florida corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇, Executive Vice President
and Treasurer
EMSA LIMITED PARTNERSHIP
a Florida limited partnership
BY: EMSA CORRECTIONAL CARE, INC.
a Florida corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇, Executive Vice
President and Treasurer
Being the duly authorized General Partner
thereof.
CORRECTIONAL HEALTH SERVICES, INC.
a New Jersey corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇, Executive Vice President
[LENDERS' SIGNATURE PAGES FOLLOW]
113
[Lender's Signature Page to $65,000,000
America Service Group Inc. Amended and Restated
Credit Agreement dated August 1, 2000]
BANK OF AMERICA, N.A., as a Lender and as
Administrative Agent and Issuing Bank
By: /s/ ▇. ▇▇▇▇▇▇ Chappin
----------------------------------------
Name: ▇. ▇▇▇▇▇▇ Chappin
------------------------------------
Title: SVP
------------------------------------
Address: Healthcare Banking Group
(TN1-100-04-17)
▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Initial Commitment: $ 25,000,000
Percentage: 38.46153846%
114
[Lender's Signature Page to $65,000,000
America Service Group Inc. Amended and Restated
Credit Agreement dated August 1, 2000]
AMSOUTH BANK,
as a Lender and as a Co-Agent
By: /s/ ▇▇▇▇▇ ▇. Wind
----------------------------------------
Name: ▇▇▇▇▇ ▇. Wind
------------------------------------
Title: VP
------------------------------------
Address: Health Care Division
AmSouth Center
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ Wind
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Initial Commitment: $ 15,000,000
Percentage: 23.07692308%
115
[Lender's Signature Page to $65,000,000
America Service Group Inc. Amended and Restated
Credit Agreement dated August 1, 2000]
▇▇▇▇▇▇ TRUST AND SAVINGS BANK,
as a Lender and as a Co-Agent
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇
------------------------------------
Title: Vice President
------------------------------------
Address: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Initial Commitment: $ 15,000,000
Percentage: 23.07692308%
116
[Lender's Signature Page to $65,000,000
America Service Group Inc. Amended and Restated
Credit Agreement dated August 1, 2000]
COMERICA BANK,
as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Title: Vice President
------------------------------------
Address: Suite ▇▇▇, ▇▇▇ ▇▇▇-▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Initial Commitment: $ 10,000,000
Percentage: 15.38461538%
117
SCHEDULES AND EXHIBITS
SCHEDULES
Schedule 7.1 Borrower, Guarantors and Subsidiaries -
Capitalization and Jurisdictions of Incorporation and
Foreign Qualification
Schedule 7.3 Post-Closing Consents
Schedule 7.6 Pending Litigation
Schedule 7.17A Indebtedness
Schedule 7.17B Contingent Obligations
Schedule 7.18A Business Locations
Schedule 7.18B Trade Names
Schedule 7.23 Service Contracts
Schedule 7.26 Employment Agreements and Executive Compensation
Arrangements
Schedule 7.27 Environmental Matters
Schedule 7.28 Material Contracts
Schedule 7.30 Operating Leases
Schedule 8.19 Post-Closing Matters
Schedule 9.2 Existing Liens
Schedule 9.4 Existing Investments
EXHIBITS
Exhibit 1.1 Form of Supplement to Amended and Restated Credit
Agreement
118
Exhibit 2.2.4 Form of Notice of Borrowing
Exhibit 2.3.2 Form of Letter of Credit Request
Exhibit 2.7.2 Form of Notice of Conversion/Continuation
Exhibit 2.8A Form of Revolving Note
Exhibit 2.8B Form of Swing Line Note
Exhibit 4.1A Form of Security Agreement
Exhibit 4.1B Form of Pledge Agreement
Exhibit 4.1C Form of Assignment and Security Agreement
Exhibit 6.1.1A Forms of Opinions of Counsel to the Borrower and the
Guarantors
Exhibit 6.1.1B Form of Solvency Certificate
Exhibit 13.2 Form of Assignment and Acceptance