EXHIBIT 10.12
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AMENDED AND RESTATED CREDIT AGREEMENT
DATED AS OF
NOVEMBER 1, 2001
AMONG
HEALTHCARE RECOVERIES, INC.
AS BORROWER
THE LENDING INSTITUTIONS NAMED THEREIN
AS LENDERS
NATIONAL CITY BANK OF KENTUCKY
AS ADMINISTRATIVE AGENT
BANK ONE, KENTUCKY, NATIONAL ASSOCIATION
AS SYNDICATION AGENT
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TABLE OF CONTENTS
PAGE
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SECTION 1. DEFINITIONS AND TERMS ................................................ 1
1.1. CERTAIN DEFINED TERMS ................................................ 1
1.2. COMPUTATION OF TIME PERIODS .......................................... 17
1.3. ACCOUNTING TERMS ..................................................... 17
1.4. TERMS GENERALLY ...................................................... 17
SECTION 2. AMOUNT AND TERMS OF LOANS ............................................ 17
2.1. COMMITMENTS FOR LOANS ................................................ 17
2.2. MINIMUM BORROWING AMOUNTS, ETC.; PRO RATA BORROWINGS ................. 18
2.3. NOTICE OF BORROWING .................................................. 18
2.4. DISBURSEMENT OF FUNDS ................................................ 19
2.5. NOTES ................................................................ 19
2.6. CONVERSIONS .......................................................... 20
2.7. INTEREST ............................................................. 20
2.8. INTEREST PERIODS ..................................................... 21
2.9. INCREASED COSTS, ILLEGALITY, ETC ..................................... 22
2.10. COMPENSATION ......................................................... 23
2.11. CHANGE OF LENDING OFFICE; REPLACEMENT OF LENDERS ..................... 24
SECTION 3. LETTERS OF CREDIT .................................................... 24
3.1. LETTERS OF CREDIT .................................................... 24
3.2. LETTER OF CREDIT REQUESTS: NOTICES OF ISSUANCE ....................... 25
3.3. AGREEMENT TO REPAY LETTER OF CREDIT DRAWINGS ......................... 25
3.4. LETTER OF CREDIT PARTICIPATIONS ...................................... 26
3.5. INCREASED COSTS ...................................................... 28
3.6. GUARANTY OF SUBSIDIARY LETTER OF CREDIT OBLIGATIONS .................. 28
SECTION 4. FEES; COMMITMENTS .................................................... 30
4.1. FEES ................................................................. 30
4.2. VOLUNTARY TERMINATION/REDUCTION OF COMMITMENTS ....................... 30
4.3. MANDATORY TERMINATION/ADJUSTMENTS OF COMMITMENTS, ETC ................ 31
SECTION 5. PAYMENTS ............................................................. 31
5.1. VOLUNTARY PREPAYMENTS ................................................ 31
5.2. MANDATORY PREPAYMENTS ................................................ 32
5.3. METHOD AND PLACE OF PAYMENT .......................................... 34
5.4. NET PAYMENTS ......................................................... 34
SECTION 6. CONDITIONS PRECEDENT ................................................. 35
6.1. CONDITIONS PRECEDENT AT CLOSING DATE ................................. 35
6.2. CONDITIONS PRECEDENT TO ALL CREDIT EVENTS ............................ 37
SECTION 7. REPRESENTATIONS AND WARRANTIES ....................................... 37
7.1. CORPORATE STATUS, ETC ................................................ 37
7.2. SUBSIDIARIES ......................................................... 38
7.3. CORPORATE POWER AND AUTHORITY, ETC ................................... 38
7.4. NO VIOLATION ......................................................... 38
7.5. GOVERNMENTAL APPROVALS AND THIRD PARTY CONSENTS ...................... 38
7.6. LITIGATION ........................................................... 38
7.7. USE OF PROCEEDS; MARGIN REGULATIONS .................................. 38
7.8. FINANCIAL STATEMENTS, ETC ............................................ 39
7.9. NO MATERIAL ADVERSE CHANGE ........................................... 39
7.10. TAX RETURNS AND PAYMENTS ............................................. 40
7.11. TITLE TO PROPERTIES, ETC ............................................. 40
7.12. LAWFUL OPERATIONS, ETC ............................................... 40
7.13. ENVIRONMENTAL MATTERS ................................................ 40
7.14. COMPLIANCE WITH ERISA ................................................ 41
7.15. INTELLECTUAL PROPERTY, ETC ........................................... 41
7.16. INVESTMENT COMPANY ................................................... 41
7.17. BURDENSOME CONTRACTS; LABOR RELATIONS ................................ 41
7.18. EXISTING INDEBTEDNESS ................................................ 41
7.19. [RESERVED.] .......................................................... 42
7.20. SECURITY INTERESTS ................................................... 42
7.21. TRUE AND COMPLETE DISCLOSURE ......................................... 42
SECTION 8. AFFIRMATIVE COVENANTS ................................................ 42
8.1. REPORTING REQUIREMENTS ............................................... 42
8.2. BOOKS, RECORDS AND INSPECTIONS ....................................... 45
8.3. INSURANCE ............................................................ 45
8.4. PAYMENT OF TAXES AND CLAIMS .......................................... 46
8.5. CORPORATE FRANCHISES ................................................. 46
8.6. GOOD REPAIR .......................................................... 46
8.7. COMPLIANCE WITH STATUTES, ETC ........................................ 46
8.8. COMPLIANCE WITH ENVIRONMENTAL LAWS ................................... 47
8.9. FISCAL YEARS, FISCAL QUARTERS ........................................ 47
8.10. CERTAIN SUBSIDIARIES TO JOIN IN SUBSIDIARY GUARANTY .................. 48
8.11. ADDITIONAL SECURITY; FURTHER ASSURANCES .............................. 48
8.12. CASUALTY AND CONDEMNATION ............................................ 50
8.13. HEDGE AGREEMENTS, ETC ................................................ 50
8.14. SENIOR DEBT .......................................................... 51
8.15. MORTGAGE ON WISCONSIN PROPERTY ....................................... 51
8.16. INTELLECTUAL PROPERTY SEARCHES ....................................... 51
SECTION 9. NEGATIVE COVENANTS ................................................... 51
9.1. CHANGES IN BUSINESS .................................................. 51
9.2. CONSOLIDATION, MERGER, ACQUISITIONS, SALE OF ASSETS, ETC ............. 51
9.3. LIENS ................................................................ 52
9.4. INDEBTEDNESS ......................................................... 53
9.5. ADVANCES, INVESTMENTS, LOANS AND GUARANTY OBLIGATIONS ................ 54
9.6. DIVIDENDS, ETC ....................................................... 55
9.7. CONSOLIDATED TOTAL INDEBTEDNESS/CONSOLIDATED EBITDA RATIO ............ 56
9.8. COVERAGE RATIOS ...................................................... 56
9.9. CAPITAL EXPENDITURES ................................................. 56
9.10. CERTAIN LEASES ....................................................... 56
9.11. MINIMUM CONSOLIDATED NET WORTH ....................................... 56
9.12. PREPAYMENTS AND REFINANCINGS OF OTHER DEBT, ETC ...................... 56
9.13. TRANSACTIONS WITH AFFILIATES ......................................... 57
9.14. LIMITATION ON CERTAIN RESTRICTIVE AGREEMENTS ......................... 57
9.15. PLAN TERMINATIONS, MINIMUM FUNDING, ETC .............................. 57
SECTION 10. EVENTS OF DEFAULT .................................................... 58
10.1. EVENTS OF DEFAULT .................................................... 58
10.2. ACCELERATION, ETC .................................................... 59
10.3. APPLICATION OF LIQUIDATION PROCEEDS .................................. 60
SECTION 11. THE ADMINISTRATIVE AGENT ............................................. 60
11.1. APPOINTMENT .......................................................... 60
11.2. DELEGATION OF DUTIES ................................................. 61
11.3. EXCULPATORY PROVISIONS ............................................... 61
11.4. RELIANCE BY ADMINISTRATIVE AGENT ..................................... 61
11.5. NOTICE OF DEFAULT .................................................... 61
11.6. NON-RELIANCE ......................................................... 62
11.7. INDEMNIFICATION ...................................................... 62
11.8. THE ADMINISTRATIVE AGENT IN INDIVIDUAL CAPACITY ...................... 62
11.9. SUCCESSOR ADMINISTRATIVE AGENT ....................................... 62
11.10. OTHER AGENTS ......................................................... 63
SECTION 12. MISCELLANEOUS ........................................................ 63
12.1. PAYMENT OF EXPENSES ETC .............................................. 63
12.2. RIGHT OF SETOFF ...................................................... 64
12.3. NOTICES .............................................................. 64
12.4. BENEFIT OF AGREEMENT ................................................. 64
12.5. NO WAIVER: REMEDIES CUMULATIVE ....................................... 66
12.6. PAYMENTS PRO RATA .................................................... 66
12.7. CALCULATIONS: COMPUTATIONS ........................................... 67
12.8. GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL 67
12.9. COUNTERPARTS ......................................................... 67
12.10. EFFECTIVENESS ........................................................ 67
12.11. HEADINGS DESCRIPTIVE ................................................. 67
12.12. AMENDMENT OR WAIVER .................................................. 68
12.13. SURVIVAL OF INDEMNITIES .............................................. 68
12.14. DOMICILE OF LOANS .................................................... 68
12.15. CONFIDENTIALITY ...................................................... 68
12.16. LENDER REGISTER ...................................................... 68
12.17. LIMITATIONS ON LIABILITY OF THE LETTER OF CREDIT ISSUERS ............. 69
12.18. GENERAL LIMITATION OF LIABILITY ...................................... 69
12.19. NO DUTY .............................................................. 69
12.20. LENDERS AND AGENT NOT FIDUCIARY TO BORROWER, ETC ..................... 69
12.21. SURVIVAL OF REPRESENTATIONS AND WARRANTIES ........................... 70
ANNEX I - INFORMATION AS TO LENDERS
ANNEX II - INFORMATION AS TO SUBSIDIARIES
ANNEX III - DESCRIPTION OF EXISTING INDEBTEDNESS
ANNEX IV - DESCRIPTION OF EXISTING LIENS
ANNEX V - DESCRIPTION OF EXISTING ADVANCES, LOANS,
INVESTMENTS AND GUARANTEES
ANNEX VI - DESCRIPTION OF LETTERS OF CREDIT DEEMED ISSUED UNDER THE
CREDIT AGREEMENT
ANNEX VII - DESCRIPTION OF CERTAIN LITIGATION
ANNEX VIII - DESCRIPTION OF CERTAIN PROPERTY
EXHIBIT A - FORM OF NOTE
EXHIBIT B-1 - FORM OF NOTICE OF BORROWING
EXHIBIT B-2 - FORM OF NOTICE OF CONVERSION
EXHIBIT B-3 - FORM OF LETTER OF CREDIT REQUEST
EXHIBIT C - FORM OF SUBSIDIARY GUARANTY
EXHIBIT D - FORM OF SECURITY AGREEMENT
EXHIBIT E - FORM OF COPYRIGHT ASSIGNMENT
EXHIBIT F - FORM OF PATENT ASSIGNMENT
EXHIBIT G - FORM OF TRADEMARK ASSIGNMENT
EXHIBIT H - FORM OF PLEDGE AGREEMENT
EXHIBIT I - FORM OF OPINION OF SPECIAL COUNSEL TO THE BORROWER
EXHIBIT J - FORM OF ASSIGNMENT AGREEMENT
EXHIBIT K - FORM OF SECTION 5.4(B)(II) CERTIFICATE
EXHIBIT L - FORM OF COMPLIANCE CERTIFICATE
vi
AMENDED AND RESTATED CREDIT AGREEMENT, dated as of November 1, 2001,
among the following:
(i) HEALTHCARE RECOVERIES, INC., a Delaware corporation
(herein, together with its successors and assigns, the "BORROWER");
(ii) the lending institutions listed in Annex I hereto
(each a "LENDER" and collectively, the "LENDERS");
(iii) NATIONAL CITY BANK OF KENTUCKY, a national banking
association, as administrative agent (the "ADMINISTRATIVE AGENT"); and
(iv) BANK ONE, KENTUCKY, NATIONAL ASSOCIATION, a national
banking association, as syndication agent:
PRELIMINARY STATEMENTS:
(1) Unless otherwise defined herein, all capitalized terms used
herein and defined in section 1 are used herein as so defined.
(2) The Borrower has applied to the Lenders for credit facilities
in order to (i) provide financing for acquisitions, and (ii) provide working
capital and funds for other lawful purposes.
(3) The Borrower, the Administrative Agent and certain of the
Lenders are parties to the Credit Agreement, dated as of February 1, 1998 (as
the same has been amended, supplemented or otherwise modified through the date
hereof, the "EXISTING CREDIT AGREEMENT").
(4) The parties hereto wish to amend and restate the Existing
Credit Agreement in its entirety pursuant to this Agreement in order to amend
certain provisions of the Existing Credit Agreement.
(5) The parties hereto have elected to amend and restate the
Existing Credit Agreement in its entirety, without constituting a novation,
pursuant to this Agreement rather than amend the Existing Credit Agreement or
enter into a new credit agreement for their convenience and intend that all
indebtedness, obligations and liens created under the Existing Credit Agreement
and the other Credit Documents (as defined in the Existing Credit Agreement) be
continued hereunder and thereunder and remain in full force and effect and not
be discharged, paid, satisfied or canceled except to the extent otherwise
provided herein and therein.
(6) On the Closing Date, (i) the Existing Credit Agreement will be
amended and restated in its entirety as set forth in this Agreement and (ii) the
Borrower may then and thereafter obtain Loans from the Lender under this
Agreement only in accordance with the Revolving Commitment hereunder and subject
to and upon the terms and conditions set forth herein.
NOW, THEREFORE, it is agreed:
SECTION 1. DEFINITIONS AND TERMS.
1.1. CERTAIN DEFINED TERMS. As used herein, the following terms
shall have the meanings herein specified unless the context otherwise requires:
"ACQUISITION" shall mean and include (i) any acquisition on a going
concern basis (whether by purchase, lease or otherwise) of any facility and/or
business operated by any person who is not a Subsidiary of the Borrower, and
(ii) acquisitions of a majority of the outstanding equity or other similar
interests in any such person (whether by merger, stock purchase or otherwise).
Notwithstanding the foregoing, the acquisition of all of the equity interests in
a special purpose entity whose assets consist entirely of financial assets (such
as leases or Indebtedness) on which the Borrower or any of its Subsidiaries is
the obligor, shall not be considered an Acquisition where such acquisition has
the effect, on a consolidated basis for the Borrower and its Subsidiaries, of
effectively retiring or otherwise extinguishing the applicable lease or
Indebtedness obligations.
"ADDITIONAL SECURITY DOCUMENT" shall have the meaning provided in
section 8.11(b).
"ADMINISTRATIVE AGENT" shall have the meaning provided in the first
paragraph of this Agreement and shall include any successor to the
Administrative Agent appointed pursuant to section 11.9.
"AFFILIATE" shall mean, with respect to any person, any other person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with such person. A person shall be deemed to control a second
person if such first person possesses, directly or indirectly, the power (i) to
vote 10% or more of the securities having ordinary voting power for the election
of directors or managers of such second person or (ii) to direct or cause the
direction of the management and policies of such second person, whether through
the ownership of voting securities, by contract or otherwise. Notwithstanding
the foregoing, (x) a director, officer or employee of a person shall not, solely
by reason of such status, be considered an Affiliate of such person; and (y)
neither the Administrative Agent nor any Lender shall in any event be considered
an Affiliate of the Borrower or any other Credit Party or any of their
respective Subsidiaries.
"AGREEMENT" shall mean this Amended and Restated Credit Agreement, as
the same may be from time to time further modified, amended and/or supplemented.
"APPLICABLE EURODOLLAR MARGIN" shall have the meaning provided in
section 2.7(g).
"APPLICABLE COMMITMENT FEE RATE" shall have the meaning provided in
section 4.1(a).
"APPLICABLE LENDING OFFICE" shall mean, with respect to each Lender,
(i) such Lender's Domestic Lending Office in the case of Borrowings consisting
of Prime Rate Loans and (ii) such Lender's Eurodollar Lending Office in the case
of Borrowings consisting of Eurodollar Loans.
"APPLICABLE PRIME RATE MARGIN" shall have the meaning provided in
section 2.7(g).
"ASSET SALE" shall mean the sale, transfer or other disposition
(including by means of Sale and Lease-Back Transactions, and by means of
mergers, consolidations, and liquidations of a corporation, partnership or
limited liability company of the interests therein of the Borrower or any
Subsidiary) by the Borrower or any Subsidiary to any person other than the
Borrower or any Subsidiary of any of their respective assets (other than sales,
transfers or other dispositions of inventory, or obsolete or excess furniture,
fixtures, equipment or other property, tangible or intangible, in the ordinary
course of business).
"ASSIGNMENT AGREEMENT" shall mean an Assignment Agreement substantially
in the form of Exhibit J hereto.
"AUTHORIZED OFFICER" shall mean any officer or employee of the Borrower
designated as such in writing to the Administrative Agent by the Borrower.
"BANKRUPTCY CODE" shall have the meaning provided in section 10.1(h).
"BORROWER" shall have the meaning provided in the first paragraph of
this Agreement.
"BORROWING" shall mean the incurrence of Loans consisting of one Type
of Loan, by the Borrower from all of the Lenders having Commitments in respect
thereof on a PRO RATA basis on a given date (or resulting from conversions on a
given date), having in the case of Eurodollar Loans the same Interest Period.
2
"BUSINESS DAY" shall mean (i) for all purposes other than as covered by
clause (ii) below, any day excluding Saturday, Sunday and any day which shall be
in the city in which the Payment Office is located a legal holiday or a day on
which banking institutions are authorized by law or other governmental actions
to close and (ii) with respect to all notices and determinations in connection
with, and payments of principal and interest on, Eurodollar Loans, any day which
is a Business Day described in clause (i) and which is also a day for trading by
and between banks in U.S. dollar deposits in the interbank Eurodollar market.
"CAPITAL LEASE" as applied to any person shall mean any lease of any
property (whether real, personal or mixed) by that person as lessee which, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that person.
"CAPITALIZED LEASE OBLIGATIONS" shall mean all obligations under
Capital Leases of the Borrower or any of its Subsidiaries in each case taken at
the amount thereof accounted for as liabilities identified as "capital lease
obligations" (or any similar words) on a consolidated balance sheet of the
Borrower and its Subsidiaries prepared in accordance with GAAP.
"CASH EQUIVALENTS" shall mean any of the following:
(i) securities issued or directly and fully guaranteed or
insured by the United States of America or any agency or
instrumentality thereof (PROVIDED that the full faith and credit of the
United States of America is pledged in support thereof) having
maturities of not more than one year from the date of acquisition;
(ii) U.S. dollar denominated time deposits, certificates
of deposit and bankers' acceptances of (x) any Lender or (y) any bank
whose short-term commercial paper rating from S&P is at least A-1 or
the equivalent thereof or from ▇▇▇▇▇'▇ is at least P-1 or the
equivalent thereof (any such bank, an "APPROVED BANK"), in each case
with maturities of not more than 180 days from the date of acquisition;
(iii) commercial paper issued by any Lender or Approved
Bank or by the parent company of any Lender or Approved Bank and
commercial paper issued by, or guaranteed by, any industrial or
financial company with a short- term commercial paper rating of at
least A-1 or the equivalent thereof by S&P or at least P-1 or the
equivalent thereof by Moody's, or guaranteed by any industrial company
with a long term unsecured debt rating of at least A or A2, or the
equivalent of each thereof, from S&P or Moody's, as the case may be,
and in each case maturing within 270 days after the date of
acquisition;
(iv) investments in money market funds substantially all
the assets of which are comprised of securities of the types described
in clauses (i) through (iii) above;
(v) investments in money market funds access to which is
provided as part of "sweep" accounts maintained with a Lender or an
Approved Bank; and
(vi) in the case of any Foreign Subsidiary only, short
term deposits, certificates of deposit, repurchase agreements and
similar financial instruments, in any currency, with or issued by any
local or international financial institution with undivided capital and
surplus of at least $250,000,000 (or the equivalent in any applicable
currency), not exceeding $100,000 (or the equivalent in any other
currency) in the case of any single financial institution.
"CASH PROCEEDS" shall mean, with respect to (i) any Asset Sale, the
aggregate cash payments (including any cash received by way of deferred payment
pursuant to a note receivable issued in connection with such Asset Sale, other
than the portion of such deferred payment constituting interest, but only as and
when so received) received by the Borrower and/or any Subsidiary from such Asset
Sale, and (ii) any Event of Loss, the aggregate cash payments, including all
insurance proceeds and proceeds of any award for condemnation or taking received
in connection with such Event of Loss.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as the same may be amended from time to
time, 42 U.S.C. ss. 9601 ET SEQ.
3
"CHANGE OF CONTROL" shall mean and include any of the following:
(i) any person or group (as such term is defined in
section 13(d)(3) of the 1934 Act), other than the Borrower and any
trustee or other fiduciary holding securities under an employee benefit
plan of the Borrower, shall acquire, directly or indirectly, beneficial
ownership (within the meaning of Rule 13d-3 and 13d-5 of the ▇▇▇▇ ▇▇▇)
of more than 50%, on a fully diluted basis, of the economic or voting
interest in the Borrower's capital stock;
(ii) the full time active employment of ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇ as chief executive officer of the Borrower shall be terminated
by the Borrower or by ▇▇. ▇▇▇▇▇▇▇▇, or shall otherwise cease, other
than by reason of death or disability, unless a successor reasonably
acceptable to the Required Lenders shall have been appointed or elected
and actually taken office on a full time basis within three months
following any such termination or cessation, in which case the name of
such successor shall be substituted for the name of the person he or
she replaces for purposes of this clause (ii);
(iii) the shareholders of the Borrower approve a merger or
consolidation of the Borrower with any other person, other than a
merger or consolidation which would result in the voting securities of
the Borrower outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted or
exchanged for voting securities of the surviving or resulting entity)
more than 50% of the combined voting power of the voting securities of
the Borrower or such surviving or resulting entity outstanding after
such merger or consolidation; and/or
(iv) the shareholders of the Borrower approve a plan of
complete liquidation of the Borrower or an agreement or agreements for
the sale or disposition by the Borrower of all or substantially all of
the Borrower's assets.
"CLOSING DATE" shall mean the date, on or after the Effective Date,
upon which the conditions specified in section 6.1 are satisfied.
"CODE" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations promulgated and the rulings issued thereunder.
Section references to the Code are to the Code, as in effect at the Effective
Date and any subsequent provisions of the Code, amendatory thereof, supplemental
thereto or substituted therefor.
"COLLATERAL" shall mean any collateral covered by any Security
Document.
"COLLATERAL AGENT" shall mean the Administrative Agent acting as
Collateral Agent for the Lenders pursuant to the Security Documents.
"COMMITMENT" shall mean, with respect to each Lender, the amount set
forth opposite such Lender's name in Annex I as its "Commitment" as the same may
be reduced from time to time pursuant to section 4.2, 4.3, 5.2 and/or 10 or
adjusted from time to time as a result of assignments to or from such Lender
pursuant to section 12.4.
"COMMITMENT FEE" shall have the meaning provided in section 4.1(a).
"CONSOLIDATED AMORTIZATION EXPENSE" shall mean, for any period, all
amortization expenses of the Borrower and its Subsidiaries, all as determined
for the Borrower and its Subsidiaries on a consolidated basis in accordance with
GAAP.
"CONSOLIDATED CAPITAL EXPENDITURES" shall mean, for any period, the
aggregate of all expenditures (whether paid in cash or accrued as liabilities
and including in all events amounts expended or capitalized under Capital Leases
but excluding any amount representing capitalized interest) by the Borrower and
its Subsidiaries during that period that, in conformity with GAAP, are or are
required to be included in the property, plant or equipment reflected in the
consolidated balance sheet of the Borrower and its Subsidiaries. In no event
shall Consolidated Capital Expenditures include any commissions which are
required to be capitalized under GAAP.
"CONSOLIDATED DEPRECIATION EXPENSE" shall mean, for any period, all
depreciation expenses of the Borrower and its Subsidiaries, all as determined
for the Borrower and its Subsidiaries on a consolidated basis in accordance with
GAAP.
4
"CONSOLIDATED EBIT" shall mean, for any period, Consolidated Net Income
for such period; PLUS (A) the sum of the amounts for such period included in
determining such Consolidated Net Income of (i) Total Interest Expense, (ii)
Total Income Tax Expense, (iii) amortization or write-off of deferred financing
costs, and (iv) extraordinary and other non-recurring non-cash losses and
charges, including without limitation, amortization or write-downs of goodwill
with respect to past acquisitions in accordance with Statement of Financial
Accounting Standards No. 142; LESS (B) gains on sales of assets and other
extraordinary gains and other non-recurring non-cash gains; all as determined
for the Borrower and its Subsidiaries on a consolidated basis in accordance with
GAAP.
"CONSOLIDATED EBITDA" shall mean, for any period, Consolidated EBIT for
such period; PLUS the sum (without duplication) of the amounts for such period
included in determining such Consolidated EBIT of (i) Consolidated Depreciation
Expense, and (ii) Consolidated Amortization Expense, all as determined for the
Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP;
PROVIDED that, notwithstanding anything to the contrary contained herein, the
Borrower's Consolidated EBITDA for any Testing Period shall (x) include the
appropriate financial items for any person or business unit which has been
acquired by the Borrower for any portion of such Testing Period prior to the
date of acquisition and (y) exclude the appropriate financial items for any
person or business unit which has been disposed of by the Borrower, for the
portion of such Testing Period prior to the date of disposition.
"CONSOLIDATED INCOME TAX EXPENSE" shall mean, for any period, all
provisions for taxes based on the net income of the Borrower or any of its
Subsidiaries (including, without limitation, any additions to such taxes, and
any penalties and interest with respect thereto), all as determined for the
Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP.
"CONSOLIDATED INTEREST EXPENSE" shall mean, for any period, total
interest expense (including that which is capitalized and that which is
attributable to Capital Leases, in accordance with GAAP) of the Borrower and its
Subsidiaries on a consolidated basis with respect to all outstanding
Indebtedness of the Borrower and its Subsidiaries including, without limitation,
net costs under Hedge Agreements, but excluding, however, any amortization of
deferred financing costs, all as determined in accordance with GAAP.
"CONSOLIDATED NET INCOME" shall mean for any period, the net income (or
loss) of the Borrower and its Subsidiaries on a consolidated basis for such
period taken as a single accounting period determined in conformity with GAAP,
PROVIDED that there shall be excluded therefrom (i) the income, (or loss) of any
entity (other than Subsidiaries of the Borrower) in which the Borrower or any of
its Subsidiaries has a joint interest, except to the extent of the amount of
dividends or other distributions actually paid to the Borrower or any of its
Subsidiaries during such period, and (ii) the income of any Subsidiary of the
Borrower to the extent that the declaration or payment of dividends or similar
distributions by that Subsidiary of that income is not at the time permitted by
operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Subsidiary.
"CONSOLIDATED NET WORTH" shall mean at any time for the determination
thereof all amounts which, in conformity with GAAP, would be included under the
caption "total stockholders' equity" (or any like caption) on a consolidated
balance sheet of the Borrower as at such date, PROVIDED that in no event shall
Consolidated Net Worth include any amounts in respect of preferred stock or
similar equity securities which is subject to mandatory redemption, in whole or
in part, pursuant to a sinking fund, scheduled redemption or similar provisions,
at any time prior to the Maturity Date.
"CONSOLIDATED TOTAL INDEBTEDNESS" shall mean the sum (without
duplication) of all Indebtedness of the Borrower and of each of its
Subsidiaries, all as determined on a consolidated basis.
"COPYRIGHT ASSIGNMENT" means the Collateral Assignment of Copyrights
and Security Agreement (as modified, amended or supplemented from time to time
in accordance with the terms thereof and hereof) substantially in the form of
Exhibit E.
"CREDIT DOCUMENTS" shall mean this Agreement, the Notes, the Subsidiary
Guaranty, the Security Documents, any Letter of Credit Document and any
Additional Security Documents.
"CREDIT EVENT" shall mean the making of any Loans and/or the issuance
of any Letter of Credit.
"CREDIT PARTY" shall mean the Borrower and each of its Subsidiaries
which is a party to any Credit Document.
5
"DEFAULT" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"DEFAULTING LENDER" shall mean any Lender with respect to which a
Lender Default is in effect.
"DESIGNATED HEDGE AGREEMENT" shall mean any Hedge Agreement to which
the Borrower or any of its Subsidiaries is a party which, pursuant to a written
instrument signed by the Administrative Agent, has been designated as a
Designated Hedge Agreement so that the Borrower's or Subsidiaries's
counterparty's credit exposure thereunder will be entitled to share in the
benefits of the Subsidiary Guaranty and the Security Documents to the extent the
Subsidiary Guaranty and such Security Documents provide guarantees or security
for creditors of the Borrower or any Subsidiary under Designated Hedge
Agreements. The Administrative Agent may, without the approval or consent of the
Lenders, designate a Hedge Agreement as a Designated Hedge Agreement if the
counterparty is a Lender or an Affiliate of a Lender and the maximum credit
exposure of such counterparty under such Hedge Agreement to the Borrower and its
Subsidiaries, when taken together with the maximum credit exposure under all
other Hedge Agreements which are Designated Hedge Agreements, is reasonably
determined by the Administrative Agent, in accordance with its own customary
valuation practices, not to exceed $4,000,000 in the aggregate; however, if the
counterparty is not a Lender or an Affiliate of a Lender, or such credit
exposure is so determined by the Administrative Agent to be such that the
aggregate credit exposure under all Designated Hedge Agreements would be greater
than $4,000,000 if such Hedge Agreement were to be a Designated Hedge Agreement,
the Administrative Agent shall only designate the Hedge Agreement involving such
counterparty as a Designated Hedge Agreement if the Administrative Agent is
instructed to do so by the Required Lenders, PROVIDED that absent instructions
from all of the Lenders, the maximum aggregate credit exposure, as computed by
the Administrative Agent, under all Designated Hedge Agreements with
counterparties who are not a Lender or an Affiliate of a Lender shall in no
event exceed $1,000,000. The Administrative Agent may impose as a condition to
any designation of a Designated Hedge Agreement a requirement that the
counterparty enter into an intercreditor or similar agreement with the
Administrative Agent under which recoveries from the Borrower and its
Subsidiaries with respect to such Designated Hedge Agreement will be shared in a
manner consistent with the provisions of section 10.3 hereof.
"DOLLARS", "U.S. DOLLARS" and the sign "$" each means lawful money of
the United States.
"DOMESTIC LENDING OFFICE" shall mean, with respect to any Lender, the
office of such Lender specified as its Domestic Lending Office in Annex I or in
the Assignment Agreement pursuant to which it became a Lender, or such other
office of such Lender as such Lender may from time to time specify to the
Borrower and the Administrative Agent.
"DOMESTIC SUBSIDIARY" shall mean any Subsidiary organized under the
laws of the United States of America, any State thereof, the District of
Columbia, or any United States possession, the chief executive office and
principal place of business of which is located in, and which conducts the
majority of its business within, the United States of America and its
territories and possessions.
"EFFECTIVE DATE" shall have the meaning provided in section 12.10.
"ELIGIBLE TRANSFEREE" shall mean and include a commercial bank,
financial institution or other "accredited investor" (as defined in SEC
Regulation D), in each case which
(i) is not disapproved in writing by the Borrower in a
notice given to a requesting Lender and the Administrative Agent,
specifying the reasons for such disapproval, within five Business Days
following the giving of notice to the Borrower of the identity of any
proposed transferee (any such disapproval by the Borrower must be
reasonable), PROVIDED that the Borrower shall not be entitled to
exercise the foregoing right of disapproval if and so long as (x) any
Event of Default shall have occurred and be continuing, or (y) a waiver
or other temporary modification of any of the financial covenants
contained in this Agreement shall be in effect following a
deterioration in the financial condition or results of operations of
the Borrower and its Subsidiaries; and
(ii) is not a direct competitor of the Borrower or engaged
in the same or similar principal lines of business as the Borrower and
its Subsidiaries considered as a whole, or is not an Affiliate of any
such competitor of the Borrower and its Subsidiaries.
6
"ENVIRONMENTAL CLAIMS" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
notices of non-compliance or violation, investigations or proceedings relating
in any way to any Environmental Law or any permit issued under any such law
(hereafter "CLAIMS"), including, without limitation, (i) any and all Claims by
governmental or regulatory authorities for enforcement, cleanup, removal,
response, remedial or other actions or damages pursuant to any applicable
Environmental Law, and (ii) any and all Claims by any third party seeking
damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from the storage, treatment or Release (as defined
in CERCLA) of any Hazardous Materials or arising from alleged injury or threat
of injury to health, safety or the environment.
"ENVIRONMENTAL LAW" shall mean any applicable Federal, state, foreign
or local statute, law, rule, regulation, ordinance, code, binding and
enforceable guideline, binding and enforceable written policy and rule of common
law now or hereafter in effect and in each case as amended, and any binding and
enforceable judicial or administrative interpretation thereof, including any
judicial or administrative order, consent, decree or judgment issued to or
rendered against the Borrower or any of its Subsidiaries relating to the
environment, employee health and safety or Hazardous Materials, including,
without limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, 33
U.S.C.ss.2601 ET SEQ.; the Clean Air Act, 42 U.S.C.ss.7401 ET SEQ.; the Safe
Drinking Water Act, 42 U.S.C.ss.3803 ET SEQ.; the Oil Pollution Act of 1990, 33
U.S.C.ss.2701 ET SEQ.; the Emergency Planning and the Community Right-to-Know
Act of 1986, 42 U.S.C.ss.11001 ET SEQ., the Hazardous Material Transportation
Act, 49 U.S.C.ss.1801 ET SEQ. and the Occupational Safety and Health Act, 29
▇.▇.▇.▇▇. 651 ET SEQ. (to the extent it regulates occupational exposure to
Hazardous Materials); and any state and local or foreign counterparts or
equivalents, in each case as amended from time to time.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to ERISA are to ERISA, as in effect at the
Effective Date and any subsequent provisions of ERISA, amendatory thereof,
supplemental thereto or substituted therefor.
"ERISA AFFILIATE" shall mean each person (as defined in section 3(9) of
ERISA) which together with the Borrower or a Subsidiary of the Borrower would be
deemed to be a "single employer" (i) within the meaning of section 414(b),(c),
(m) or (o) of the Code or (ii) as a result of the Borrower or a Subsidiary of
the Borrower being or having been a general partner of such person.
"EURODOLLAR LENDING OFFICE" shall mean, with respect to any Lender, the
office of such Lender specified as its Eurodollar Lending Office in Annex I or
in the Assignment Agreement pursuant to which it became a Lender, or such other
office or offices for Eurodollar Loans of such Lender as such Lender may from
time to time specify to the Borrower and the Administrative Agent.
"EURODOLLAR LOANS" shall mean each Loan bearing interest at the rates
provided in section 2.7(b).
"EURODOLLAR RATE" shall mean with respect to each Interest Period for a
Eurodollar Loan, (A) either (i) the rate per annum for deposits in Dollars of
amounts in same day funds comparable to the outstanding principal amount of the
Eurodollar Loan for which an interest rate is then being determined for a
maturity most nearly comparable to such Interest Period which appears on page
3750 of the Dow ▇▇▇▇▇ Telerate Screen as of 11:00 A.M. (local time at the Notice
Office) on the date which is two Business Days prior to the commencement of such
Interest Period, or (ii) if such a rate does not appear on such page, an
interest rate per annum equal to the average (rounded upward to the nearest
whole multiple of 1/16 of 1% per annum, if such average is not such a multiple)
of the rate per annum at which deposits in Dollars are offered to each of the
Reference Banks by prime banks in the London interbank Eurodollar market for
deposits of amounts in Dollars in same day funds comparable to the outstanding
principal amount of the Eurodollar Loan for which an interest rate is then being
determined with maturities comparable to the Interest Period to be applicable to
such Eurodollar Loan, determined as of 11:00 A.M. (London time) on the date
which is two Business Days prior to the commencement of such Interest Period, in
each case divided (and rounded upward to the nearest whole multiple of 1/16th of
1%) by (B) a percentage equal to 100% minus the then stated maximum rate of all
reserve requirements (including, without limitation, any marginal, emergency,
supplemental, special or other reserves and without benefit of credits for
proration, exceptions or offsets which may be available from time to time)
applicable to any member bank of the Federal Reserve System in respect of
Eurocurrency liabilities as defined in Regulation D (or any successor category
of liabilities under Regulation D).
"EVENT OF DEFAULT" shall have the meaning provided in section 10.1.
7
"EVENT OF LOSS" shall mean, with respect to any property, (i) the
actual or constructive total loss of such property or the use thereof, resulting
from destruction, damage beyond repair, or the rendition of such property
permanently unfit for normal use from any casualty or similar occurrence
whatsoever, (ii) the destruction or damage of a portion of such property from
any casualty or similar occurrence whatsoever under circumstances in which such
damage cannot reasonably be expected to be repaired, or such property cannot
reasonably be expected to be restored to its condition immediately prior to such
destruction or damage, within 90 days after the occurrence of such destruction
or damage, (iii) the condemnation, confiscation or seizure of, or requisition of
title to or use of, any property, or (iv) in the case of any property located
upon a Leasehold, the termination or expiration of such Leasehold.
"EXCESS AMOUNT" shall have the meaning provided in section 5.2(c).
"EXISTING CREDIT AGREEMENT" shall have the meaning provided in the
Preliminary Statements of this Agreement.
"EXISTING INDEBTEDNESS" shall have the meaning provided in section
7.18.
"EXISTING INDEBTEDNESS AGREEMENTS" shall have the meaning provided in
section 7.18.
"EXISTING LETTER OF CREDIT" shall have the meaning provided in section
3.1(d).
"FACING FEE" shall have the meaning provided in section 4.1(c).
"FEDERAL FUNDS EFFECTIVE RATE" shall mean, for any period, a
fluctuating interest rate equal for each day during such period to the weighted
average of the rates on overnight Federal Funds transactions with members of the
Federal Reserve System arranged by Federal Funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by the Administrative Agent from three Federal
Funds brokers of recognized standing selected by the Administrative Agent.
"FEES" shall mean all amounts payable pursuant to, or referred to in,
section 4.1.
"FINANCIAL PROJECTIONS" shall have the meaning provided in section
7.8(c).
"FOREIGN SUBSIDIARY" shall mean any Subsidiary (i) which is not formed
in the United States and substantially all of whose assets and properties are
located, or substantially all of whose business is carried on, outside the
United States, or (ii) substantially all of whose assets consist of Subsidiaries
that are Foreign Subsidiaries as defined in clause (i) of this definition.
"GAAP" shall mean generally accepted accounting principles in the
United States of America as in effect from time to time; it being understood and
agreed that determinations in accordance with GAAP for purposes of section 9,
including defined terms as used therein, are subject (to the extent provided
therein) to sections 1.3 and 12.7(a).
"GROSS RECOVERIES IN PROCESS" shall mean the total dollar amount of
potentially recoverable claims that the Borrower and its Subsidiaries are
pursuing on behalf of their clients at a given point in time, prior to estimates
of claim settlement and rejection, as (i) reported by the Borrower as "backlog"
in its most recent SEC Report or (ii) failing the availability of such SEC
Report, computed by the Borrower in accordance with its procedures and practices
as in effect on the date of the most recent financial statements referred to in
section 7.8(a).
"GUARANTY OBLIGATIONS" shall mean as to any person (without
duplication) any obligation of such person guaranteeing any Indebtedness
("PRIMARY INDEBTEDNESS") of any other person (the "PRIMARY OBLIGOR") in any
manner, whether directly or indirectly, including, without limitation, any
obligation of such person, whether or not contingent, (a) to purchase any such
primary Indebtedness 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 Indebtedness 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 Indebtedness of the
ability of the primary obligor to make payment of such primary Indebtedness, or
(d) otherwise to assure or hold harmless the owner of such primary Indebtedness
against loss in respect thereof, PROVIDED, HOWEVER, that the term Guaranty
Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of
8
business. The amount of any Guaranty Obligation shall be deemed to be an amount
equal to the stated or determinable amount of the primary Indebtedness in
respect of which such Guaranty Obligation is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
(assuming such person is required to perform thereunder) as determined by such
person in good faith.
"HEDGE AGREEMENT" shall mean (i) any interest rate swap agreement, any
interest rate cap agreement, any interest rate collar agreement or other similar
agreement or arrangement designed to protect against fluctuations in interest
rates, and (ii) any currency swap agreement, forward currency purchase agreement
or similar agreement or arrangement designed to protect against fluctuations in
currency exchange rates.
"HAZARDOUS MATERIALS" shall mean (i) any petrochemical or petroleum
products, radioactive materials, asbestos in any form that is or could become
friable, urea formaldehyde foam insulation, transformers or other equipment that
contain dielectric fluid containing levels of polychlorinated biphenyls, and
radon gas; and (ii) any chemicals, materials or substances defined as or
included in the definition of "hazardous substances", "hazardous wastes",
"hazardous materials", "restricted hazardous materials", "extremely hazardous
wastes", "restrictive hazardous wastes", "toxic substances", "toxic pollutants",
"contaminants" or "pollutants", or words of similar meaning and regulatory
effect, under any applicable Environmental Law.
"INDEBTEDNESS" of any person shall mean without duplication:
(i) all indebtedness of such person for borrowed money;
(ii) all bonds, notes, debentures and similar debt
securities of such person;
(iii) the deferred purchase price of capital assets or
services which in accordance with GAAP would be shown on the liability
side of the balance sheet of such person;
(iv) the face amount of all letters of credit issued for
the account of such person and, without duplication, all drafts drawn
thereunder;
(v) all obligations, contingent or otherwise, of such
person in respect of bankers' acceptances;
(vi) all Indebtedness of a second person secured by any
Lien on any property owned by such first person, whether or not such
indebtedness has been assumed;
(vii) all Capitalized Lease Obligations of such person;
(viii) the present value, determined on the basis of the
implicit interest rate, of all basic rental obligations under all
"synthetic" leases (i.e. leases accounted for by the lessee as
operating leases under which the lessee is the "owner" of the leased
property for Federal income tax purposes);
(ix) all obligations of such person to pay a specified
purchase price for goods or services whether or not delivered or
accepted, I.E., take-or-pay and similar obligations;
(x) all net obligations of such person under Hedge
Agreements;
(xi) the full outstanding balance of trade receivables,
notes or other instruments sold with full recourse (and the portion
thereof subject to potential recourse, if sold with limited recourse),
other than in any such case any thereof sold solely for purposes of
collection of delinquent accounts;
(xii) the stated value, or liquidation value if higher, of
all preferred stock and similar equity securities of such person which
are subject to mandatory redemption, in whole or in part, pursuant to a
sinking fund, scheduled redemption or similar provisions, at any time
prior to the Maturity Date; and
(xiii) all Guaranty Obligations of such person;
9
PROVIDED that (x) neither trade payables nor other similar accrued expenses, in
each case arising in the ordinary course of business, nor obligations in respect
of insurance policies or performance or surety bonds which themselves are not
guarantees of Indebtedness (nor drafts, acceptances or similar instruments
evidencing the same nor obligations in respect of letters of credit supporting
the payment of the same), shall constitute Indebtedness; and (y) the
Indebtedness of any person shall in any event include (without duplication) the
Indebtedness of any other entity (including any general partnership in which
such person is a general partner) to the extent such person is liable thereon as
a result of such person's ownership interest in or other relationship with such
entity, except to the extent the terms of such Indebtedness provide expressly
that such person is not liable thereon.
"INTEREST PERIOD" with respect to any Eurodollar Loan shall mean the
interest period applicable thereto, as determined pursuant to section 2.8.
"LEASEHOLDS" of any person means all the right, title and interest of
such person as lessee or licensee in, to and under leases or licenses of land,
improvements and/or fixtures.
"LENDER" shall have the meaning provided in the first paragraph of this
Agreement.
"LENDER DEFAULT" shall mean (i) the refusal (which has not been
retracted) of a Lender in violation of the requirements of this Agreement to
make available its portion of any incurrence of Loans or to fund its portion of
any unreimbursed payment under section 3.4(c) or (ii) a Lender having notified
the Administrative Agent and/or the Borrower that it does not intend to comply
with the obligations under section 2.1 and/or section 3.4(c), in the case of
either (i) or (ii) as a result of the appointment of a receiver or conservator
with respect to such Lender at the direction or request of any regulatory agency
or authority.
"LENDER REGISTER" shall have the meaning provided in section 12.16.
"LETTER OF CREDIT" shall have the meaning provided in section 3.1(a).
"LETTER OF CREDIT DOCUMENTS" shall have the meaning specified in
section 3.2(a).
"LETTER OF CREDIT FEE" shall have the meaning provided in section
4.1(b).
"LETTER OF CREDIT ISSUER" shall mean (i) in respect of each Existing
Letter of Credit, the Lender that has issued same as of the Effective Date; and
(ii) in respect of any other Letter of Credit, NCB.
"LETTER OF CREDIT OUTSTANDINGS" shall mean, at any time, the sum,
without duplication, of (i) the aggregate Stated Amount of all outstanding
Letters of Credit and (ii) the aggregate amount of all Unpaid Drawings.
"LETTER OF CREDIT REQUEST" shall have the meaning provided in section
3.2(a).
"LIEN" shall mean any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including any agreement to give any of the
foregoing, any conditional sale or other title retention agreement or any lease
in the nature thereof).
"LOAN" shall have the meaning provided in section 2.1.
"MARGIN STOCK" shall have the meaning provided in Regulation U.
"MATERIAL ADVERSE EFFECT" shall mean a material adverse effect on the
business, operations, property, assets, liabilities or financial condition of,
(i) when used with reference to the Borrower or any of its Subsidiaries, the
Borrower and its Subsidiaries, taken as a whole, or (ii) when used with
reference to any other person, such person and its Subsidiaries, taken as a
whole, as the case may be.
"MATERIAL SUBSIDIARY" shall mean, at any time, with reference to any
person, any Subsidiary of such person (i) that has assets at such time
comprising 10% or more of the consolidated assets of such person and its
Subsidiaries, or (ii) whose operations in the current fiscal year are expected
to, or whose operations in the most recent fiscal year did (or would have if
such person had been a Subsidiary for such entire fiscal year), represent 10% or
more of the consolidated earnings before interest, taxes, depreciation and
amortization of such person and its Subsidiaries for such fiscal year.
10
"MATURITY DATE" shall mean the Business Day in November 2004 which
occurs immediately prior to the third anniversary of the Closing Date, unless
earlier terminated or unless extended by a writing signed by the Borrower and
each Lender.
"MAXIMUM AVAILABILITY" shall mean, as of any date of determination, the
lesser of (i) the Total Commitment at such time or (ii) an amount equal to the
product of (a) Consolidated EBITDA for the Testing Period most recently
completed as demonstrated on the financial statements of the Borrower delivered
pursuant to Section 8.1(a) and 8.1(b) and (b) 2.5.
"MINIMUM BORROWING AMOUNT" shall mean (i) for Prime Rate Loans,
$500,000, with minimum increments thereafter of $100,000 and (ii) for Eurodollar
Loans, $1,000,000, with minimum increments thereafter of $100,000.
"MINIMUM GROSS RECOVERIES IN PROCESS" shall mean (i) 75% of the Gross
Recoveries in Process as of September 30, 2001, plus (ii) for each subsequent
fiscal quarter 75% of any increase in Gross Recoveries in Process at the end of
such fiscal quarter as compared to the Gross Recoveries in Process at the
beginning of such fiscal quarter, with no reduction in the case of any decrease
during a fiscal quarter in Gross Recoveries in Process; provided that in no
event shall the Minimum Gross Recoveries in Process exceed $1 billion; and
provided, further, that Minimum Gross Recoveries in Process shall be reduced by
any downward adjustment in Gross Recoveries in Process which the Borrower may
make in the exercise of its judgment in connection with an Acquisition or the
installation of a new client or new book of business from an existing client if
such adjustment is made within 180 days following the completion of such
Acquisition or such installation.
"MOODY'S" shall mean ▇▇▇▇▇'▇ Investors Service, Inc. and its
successors.
"MORTGAGES" shall mean each of the Mortgages or Deeds of Trust executed
by any Credit Party in favor of the Collateral Agent to secure the Obligations.
"MULTIEMPLOYER PLAN" shall mean a multiemployer plan, as defined in
section 4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate is
making or accruing an obligation to make contributions or has within any of the
preceding three plan years made or accrued an obligation to make contributions.
"MULTIPLE EMPLOYER PLAN" shall mean an employee benefit plan, other
than a Multiemployer Plan, to which the Borrower or any ERISA Affiliate, and one
or more employers other than the Borrower or an ERISA Affiliate, is making or
accruing an obligation to make contributions or, in the event that any such plan
has been terminated, to which the Borrower or an ERISA Affiliate made or accrued
an obligation to make contributions during any of the five plan years preceding
the date of termination of such plan.
"NCB" shall mean National City Bank of Kentucky, a national banking
association, together with its successors and assigns.
"NET CASH PROCEEDS" shall mean, with respect to any (i) Asset Sale, the
Cash Proceeds resulting therefrom net of (a) reasonable and customary expenses
of sale incurred in connection with such Asset Sale, and other reasonable and
customary fees and expenses incurred, and all state, and local taxes paid or
reasonably estimated to be payable by such person, as a consequence of such
Asset Sale and the payment of principal, premium and interest of Indebtedness
secured by the asset which is the subject of the Asset Sale and required to be,
and which is, repaid under the terms thereof as a result of such Asset Sale, (b)
amounts of any distributions payable to holders of minority interests in the
relevant person or in the relevant property or assets and (c) incremental
federal, state and local income taxes paid or payable as a result thereof, and
(ii) Event of Loss, the Cash Proceeds resulting therefrom net of (a) reasonable
and customary expenses incurred in connection with such Event of Loss, and local
taxes paid or reasonably estimated to be payable by such person, as a
consequence of such Event of Loss and the payment of principal, premium and
interest of Indebtedness (other than the Obligations) secured by the asset which
is the subject of the Event of Loss and required to be, and which is, repaid
under the terms thereof as a result of such Event of Loss, (b) amounts of any
distributions payable to holders of minority interests in the relevant person or
in the relevant property or assets and (c) incremental federal, state and local
income taxes paid or payable as a result thereof.
"1934 ACT" shall mean the Securities Exchange Act of 1934, as amended.
11
"NON-DEFAULTING LENDER" shall mean each Lender other than a Defaulting
Lender.
"NOTE" shall have the meaning provided in section 2.5(a).
"NOTICE OF BORROWING" shall have the meaning provided in section
2.3(a).
"NOTICE OF CONVERSION" shall have the meaning provided in section 2.6.
"NOTICE OFFICE" shall mean the office of the Administrative Agent at
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ - ▇▇▇ ▇▇▇▇▇ (facsimile: (▇▇▇) ▇▇▇-▇▇▇▇), or such other office,
located in a city in the United States Eastern Time Zone, as the Administrative
Agent may designate to the Borrower from time to time.
"OBLIGATIONS" shall mean all amounts, direct or indirect, contingent or
absolute, of every type or description, and at any time existing, owing to the
Administrative Agent or any Lender pursuant to the terms of this Agreement or
any other Credit Document.
"PARTICIPANT" shall have the meaning provided in section 3.4(a).
"PATENT ASSIGNMENT" means the Collateral Assignment of Patents and
Security Agreement (as modified, amended or supplemented from time to time in
accordance with the terms thereof and hereof) substantially in the form of
Exhibit F.
"PAYMENT OFFICE" shall mean the office of the Administrative Agent at
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ - ▇▇▇ ▇▇▇▇▇ (facsimile: (▇▇▇) ▇▇▇-▇▇▇▇), or such other office,
located in a city in the United States Eastern Time Zone, as the Administrative
Agent may designate to the Borrower from time to time.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to section 4002 of ERISA, or any successor thereto.
"PERCENTAGE" shall mean at any time for any Lender, the percentage
obtained by dividing such Lender's Commitment by the Total Commitment, PROVIDED,
that if the Total Commitment has been terminated, the Percentage for each Lender
shall be determined by dividing such Lender's Commitment immediately prior to
such termination by the Total Commitment immediately prior to such termination.
"PERMITTED ACQUISITION" shall mean and include any Acquisition as to
which all of the following conditions are satisfied:
(i) such Acquisition involves a line or lines of business
which is complementary to the lines of business in which the Borrower
and its Subsidiaries, considered as an entirety, are engaged on the
Effective Date; and
(iii) the aggregate consideration for such Acquisition
(taken together with any other substantially contemporaneous
Acquisition with the same party or parties and/or their Affiliates),
including the principal amount of any assumed Indebtedness and (without
duplication) any Indebtedness of any acquired person or persons, does
not exceed $5,000,000, unless the Required Lenders specifically approve
or consent to such acquisition in writing;
PROVIDED, that the term Permitted Acquisition specifically excludes any loans,
advances or minority investments otherwise permitted pursuant to section 9.5.
"PERMITTED LIENS" shall mean Liens permitted by section 9.3.
"PERSON" shall mean any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other enterprise
or any government or political subdivision or any agency, department or
instrumentality thereof.
12
"PLAN" shall mean any multiemployer or single-employer plan as defined
in section 4001 of ERISA, which is maintained or contributed to by (or to which
there is an obligation to contribute by) the Borrower or a Subsidiary of the
Borrower or an ERISA Affiliate, and each such plan for the five year period
immediately following the latest date on which the Borrower, or a Subsidiary of
the Borrower or an ERISA Affiliate maintained, contributed to or had an
obligation to contribute to such plan.
"PLEDGE AGREEMENT" shall mean the Pledge Agreement (as modified,
amended or supplemented from time to time in accordance with the terms thereof
and hereof) substantially in the form attached hereto as Exhibit H.
"PRIME RATE" shall mean, for any period, a fluctuating interest rate
per annum as shall be in effect from time to time which rate per annum shall at
all times be equal to the greater of (i) the rate of interest established by NCB
in Louisville, Kentucky, from time to time, as its prime rate, whether or not
publicly announced, which interest rate may or may not be the lowest rate
charged by it for commercial loans or other extensions of credit; and (ii) the
Federal Funds Effective Rate in effect from time to time PLUS 1/2 of 1% per
annum.
"PRIME RATE LOAN" shall mean each Loan bearing interest at the rate
provided in section 2.7(a).
"PROHIBITED TRANSACTION" shall mean a transaction with respect to a
Plan that is prohibited under section 4975 of the Code or section 406 of ERISA
and not exempt under section 4975 of the Code or section 408 of ERISA.
"RCRA" shall mean the Resource Conservation and Recovery Act, as the
same may be amended from time to time, 42 U.S.C. ss. 6901 ET SEQ.
"REAL PROPERTY" of any person shall mean all of the right, title and
interest of such person in and to land, improvements and fixtures, including
Leaseholds.
"REFERENCE BANKS" shall mean (i) NCB and (ii) any other Lender or
Lenders selected as a Reference Bank by the Administrative Agent and the
Required Lenders, PROVIDED, that if any of such Reference Banks is no longer a
Lender, such other Lender or Lenders as may be selected by the Administrative
Agent acting on instructions from the Required Lenders.
"REGULATION D" shall mean Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or a portion thereof establishing reserve requirements.
"REGULATION U" shall mean Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or a portion thereof establishing margin requirements.
"REPORTABLE EVENT" shall mean an event described in section 4043(c) of
ERISA with respect to a Plan other than those events as to which the 30-day
notice period is waived under subsection .13, .14, .16, .18, .19 or .20 of PBGC
Regulation section 2615.
"REQUIRED LENDERS" shall mean Non-Defaulting Lenders whose outstanding
Loans and Unutilized Commitments constitute more than 66% of the sum of the
total outstanding Loans and Unutilized Commitments of Non-Defaulting Lenders
(PROVIDED that, for purposes hereof, neither the Borrower, nor any of its
Affiliates, shall be included in (i) the Lenders holding such amount of the
Loans or having such amount of the Unutilized Commitments, or (ii) determining
the aggregate unpaid principal amount of the Loans or Unutilized Commitments).
"SALE AND LEASE-BACK TRANSACTION" shall mean any arrangement with any
person providing for the leasing by the Borrower or any Subsidiary of the
Borrower of any property (except for temporary leases for a term, including any
renewal thereof, of not more than one year and except for leases between the
Borrower and a Subsidiary or between Subsidiaries), which property has been or
is to be sold or transferred by the Borrower or such Subsidiary to such person.
"S&P" shall mean Standard & Poor's Ratings Group, a division of McGraw
Hill, Inc., and its successors.
"SEC" shall mean the United States Securities and Exchange Commission.
"SEC REGULATION D" shall mean Regulation D as promulgated under the
Securities Act of 1933, as amended, as the same may be in effect from time to
time.
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"SEC REPORT" shall mean periodic or current reports filed pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934, including,
without limitation, Forms 10-Q and 10-K.
"SECTION 5.4(B)(II) CERTIFICATE" shall have the meaning provided in
section 5.4(b)(ii).
"SECURITY AGREEMENT" shall mean the Amended and Restated Security
Agreement (as modified, amended or supplemented from time to time in accordance
with the terms thereof and hereof) substantially in the form attached hereto as
Exhibit D.
"SECURITY DOCUMENTS" shall mean the Security Agreement, the Copyright
Assignment, the Patent Assignment, the Trademark Assignment, the Pledge
Agreement, each Mortgage and each other document pursuant to which any Lien or
security interest is granted by any Credit Party to the Collateral Agent as
security for any of the Obligations.
"STANDARD PERMITTED LIENS" shall mean the following:
(i) Liens for taxes not yet delinquent or Liens for taxes
being contested in good faith and by appropriate proceedings for which
adequate reserves (in the good faith judgment of the management of the
Borrower) have been established;
(ii) Liens in respect of property or assets imposed by law
which were incurred in the ordinary course of business, such as
carriers', warehousemen's, materialmen's and mechanics' Liens and other
similar Liens arising in the ordinary course of business, which do not
in the aggregate materially detract from the value of such property or
assets or materially impair the use thereof in the operation of the
business of the Borrower or any Subsidiary;
(iii) Liens created by this Agreement or the other Credit
Documents;
(iv) Liens (x) in existence on the Closing Date which are
listed, and the Indebtedness secured thereby and the property subject
thereto on the Closing Date described, in Annex IV, or (y) arising out
of the refinancing, extension, renewal or refunding of any Indebtedness
secured by any such Liens, PROVIDED that the principal amount of such
Indebtedness is not increased and such Indebtedness is not secured by
any additional assets;
(v) Liens arising from judgments, decrees or attachments
in circumstances not constituting an Event of Default under section
10.1(g);
(vi) Liens (other than any Lien imposed by ERISA) incurred
or deposits made in the ordinary course of business in connection with
workers' compensation, unemployment insurance and other types of social
security; and mechanic's Liens, carrier's Liens, and other Liens to
secure the performance of tenders, statutory obligations, contract
bids, government contracts, performance and return-of-money bonds and
other similar obligations, incurred in the ordinary course of business
(exclusive of obligations in respect of the payment for borrowed
money), whether pursuant to statutory requirements, common law or
consensual arrangements;
(vii) Leases or subleases granted to others not interfering
in any material respect with the business of the Borrower or any of its
Subsidiaries and any interest or title of a lessor under any lease not
in violation of this Agreement;
(viii) easements, rights-of-way, zoning or deed
restrictions, minor defects or irregularities in title and other
similar charges or encumbrances not interfering in any material respect
with the ordinary conduct of the business of the Borrower or any of its
Subsidiaries considered as an entirety; and
(ix) Liens arising from financing statements regarding
property subject to leases not in violation of the requirements of this
Agreement, PROVIDED that such Liens are only in respect of the property
subject to, and secure only, the respective lease (and any other lease
with the same or an affiliated lessor).
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"STATED AMOUNT" of each Letter of Credit shall mean the maximum
available to be drawn thereunder (regardless of whether any conditions or other
requirements for drawing could then be met).
"SUBSIDIARY" of any person shall mean and include (i) any corporation
more than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such person directly or
indirectly through Subsidiaries and (ii) any partnership, association, joint
venture or other entity in which such person directly or indirectly through
Subsidiaries, has more than a 50% equity interest at the time. Unless otherwise
expressly provided, all references herein to "Subsidiary" shall mean a
Subsidiary of the Borrower.
"SUBSIDIARY GUARANTOR" shall mean any Subsidiary which is a party to
the Subsidiary Guaranty.
"SUBSIDIARY GUARANTY" means the Subsidiary Guaranty (as modified,
amended or supplemented from time to time in accordance with the terms thereof
and hereof) substantially in the form of Exhibit C.
"SUBORDINATED INDEBTEDNESS" shall mean any Indebtedness which has been
subordinated to the Obligations in such manner and to such extent as the
Administrative Agent (acting on instructions from the Required Lenders) may
require.
"TESTING PERIOD" shall mean for any determination a single period
consisting of the four consecutive fiscal quarters of the Borrower then last
ended (whether or not such quarters are all within the same fiscal year), EXCEPT
that if a particular provision of this Agreement indicates that a Testing Period
shall be of a different specified duration, such Testing Period shall consist of
the particular fiscal quarter or quarters then last ended which are so indicated
in such provision.
"TOTAL COMMITMENT" shall mean the sum of the Commitments of the
Lenders.
"TRADEMARK ASSIGNMENT" means the Collateral Assignment of Trademarks
and Security Agreement (as modified, amended or supplemented from time to time
in accordance with the terms thereof and hereof) substantially in the form of
Exhibit G.
"TYPE" shall mean any type of Loan determined with respect to the
interest option applicable thereto, I.E., a Prime Rate Loan or Eurodollar Loan.
"UCC" shall mean the Uniform Commercial Code.
"UNFUNDED CURRENT LIABILITY" of any Plan shall mean the amount, if any,
by which the actuarial present value of the accumulated plan benefits under the
Plan as of the close of its most recent plan year exceeds the fair market value
of the assets allocable thereto, each determined in accordance with Statement of
Financial Accounting Standards No. 87, based upon the actuarial assumptions used
by the Plan's actuary in the most recent annual valuation of the Plan.
"UNITED STATES" and "U.S." each means United States of America.
"UNPAID DRAWING" shall have the meaning provided in section 3.3(a).
"UNUTILIZED COMMITMENT" for any Lender at any time shall mean the
excess of (i) such Lender's Commitment at such time over (ii) the sum of the
principal amount of Loans made by such Lender and outstanding at such time and
(y) such Lender's Percentage of Letter of Credit Outstandings at such time.
"UNUTILIZED TOTAL COMMITMENT" shall mean, at any time, the excess of
(i) the Total Commitment at such time over (ii) the sum of (x) the aggregate
principal amount of all Loans then outstanding plus (y) the aggregate Letter of
Credit Outstandings at such time.
"WHOLLY-OWNED SUBSIDIARY" shall mean each Subsidiary of the Borrower at
least 95% of whose capital stock, equity interests and partnership interests,
other than director's qualifying shares or similar interests, are owned directly
or indirectly by the Borrower.
15
"WISCONSIN MORTGAGE" shall have the meaning provided in section 8.15.
"WISCONSIN PROPERTY" shall have the meaning provided in section 8.15.
"WRITTEN", "WRITTEN" or "IN WRITING" shall mean any form of written
communication or a communication by means of telex, facsimile transmission,
telegraph or cable.
1.2. COMPUTATION OF TIME PERIODS. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
means "to but excluding".
1.3. ACCOUNTING TERMS. Except as otherwise specifically provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; PROVIDED that, if the
Borrower notifies the Administrative Agent that the Borrower requests an
amendment to any provision of section 8 or 9 hereof to eliminate the effect of
any change occurring after the Effective Date in GAAP or in the application
thereof to such provision (or if the Administrative Agent notifies the Borrower
that the Required Lenders request an amendment to any such provision hereof for
such purposes), regardless of whether any such notice is given before or after
such change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance with the requirements of this
Agreement.
1.4. TERMS GENERALLY. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise, (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any person shall be construed to include such person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to sections, Annexes
and Exhibits shall be construed to refer to sections of, and Annexes and
Exhibits to, this Agreement, and (e) the words "asset" and "property" shall be
construed to have the same meaning and effect and to refer to any and all real
property, tangible and intangible assets and properties, including cash,
securities, accounts and contract rights, and interests in any of the foregoing.
SECTION 2. AMOUNT AND TERMS OF LOANS.
2.1. COMMITMENTS FOR LOANS. Subject to and upon the terms and
conditions herein set forth, each Lender severally agrees to make a loan or
loans (each a "LOAN" and, collectively, the "LOANS") to the Borrower, which
Loans shall be drawn in accordance with the following provisions:
(a) Loans may be incurred by the Borrower at any time and
from time to time on and after the Closing Date and prior to the
Maturity Date, PROVIDED that, no Loan will be made in any amount which,
after giving effect thereto, would cause the sum of the aggregate
outstanding Loans and the Letter of Credit Outstandings to exceed the
Maximum Availability at such time;
(b) except as otherwise provided, Loans may, at the
option of the Borrower, be incurred and maintained as, or converted
into, Loans which are Prime Rate Loans or Eurodollar Loans, in each
case denominated in Dollars, PROVIDED that all Loans made as part of
the same Borrowing shall, unless otherwise specifically provided
herein, consist of Loans of the same Type;
(c) Loans may be repaid or prepaid and reborrowed in
accordance with the provisions hereof;
(d) if as of the end of the Borrower's most recent fiscal
quarter the Borrower's Gross Recoveries in Process at the end of such
fiscal quarter are less than the Minimum Gross Recoveries in Process at
such time, no additional Loans may be incurred if, after giving effect
thereto, the sum of the aggregate outstanding Loans and the Letter of
Credit Outstandings would exceed 5% of the Borrower's Gross Recoveries
in Process as of the end of such fiscal quarter;
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(e) if at the time any Loan is to be incurred the
Borrower is then obligated to make at such time or thereafter
prepayments of Loans under section 5.2(c) in respect of the Excess
Amount, the amount otherwise available to be borrowed hereunder shall
be reduced by the full original balance of the Excess Amount (without
regard to the amount of prepayments of Loans which have already been
made under section 5.2(c) in respect of such Excess Amount), but no
such reduction shall be taken into account for purposes of section
4.1(a) hereof); and
(f) Loans made by any Lender shall not exceed for such
Lender at any time outstanding that aggregate principal amount which,
when added to the product at such time of (i) such Lender's Percentage,
TIMES (ii) the aggregate Letter of Credit Outstandings, equals the
Commitment of such Lender at such time.
(g) It is the intention of the Borrower and the Lenders
that, without constituting a novation, the Obligations as of the
Closing Date under this Agreement be and hereby are the some
Obligations as those outstanding under the Existing Credit Agreement
immediately prior to the effectiveness of this Agreement. In the event
that any loans under the Existing Credit Agreement shall remain
outstanding on the Closing Date, then any then-outstanding Interest
Periods shall automatically be terminated and such loans shall be
continued as Loans hereunder, and the Lenders hereunder shall, on the
Closing Date, take such actions, and make such adjustments among
themselves, as shall be necessary so that such loans are held hereunder
pro rata in accordance with their respective Commitments, including by
purchasing the loans under the Existing Credit Agreement of any
"Lenders" under the Existing Credit Agreement that are not becoming
Lenders hereunder. On the Closing Date, the Borrower shall cause to be
paid to each "Lender" party to the Existing Credit Agreement, all
amounts that would be owing to such Lender under section 2.10 of the
Existing Credit Agreement as if the "Loans" of such Lender under the
Existing Credit Agreement were being repaid on the Closing Date,
whether or not any such loans are actually repaid on the Closing Date.
2.2. MINIMUM BORROWING AMOUNTS, ETC.; PRO RATA BORROWINGS. (a) The
aggregate principal amount of each Borrowing by the Borrower shall not be less
than the Minimum Borrowing Amount. More than one Borrowing may be incurred by
the Borrower on any day, PROVIDED that (i) if there are two or more Borrowings
on a single day by the Borrower which consist of Eurodollar Loans, each such
Borrowing shall have a different initial Interest Period, and (ii) at no time
shall there be more than 7 Borrowings of Eurodollar Loans outstanding hereunder.
(b) All Borrowings shall be made by the Lenders PRO RATA on the
basis of their respective Commitments. It is understood that no Lender shall be
responsible for any default by any other Lender in its obligation to make Loans
hereunder and that each Lender shall be obligated to make the Loans provided to
be made by it hereunder, regardless of the failure of any other Lender to
fulfill its Commitment hereunder.
2.3. NOTICE OF BORROWING. (a) Whenever the Borrower desires to
incur Loans, it shall give the Administrative Agent at its Notice Office,
(A) BORROWINGS OF EURODOLLAR LOANS: prior to 11:00 A.M.
(local time at its Notice Office), at least three Business Days' prior
written or telephonic notice (in the case of telephonic notice,
promptly confirmed in writing if so requested by the Administrative
Agent) of each Borrowing of Eurodollar Loans to be made hereunder, or
(B) BORROWINGS OF PRIME RATE LOANS: prior to 11:00 A.M.
(local time at its Notice Office) on the proposed date thereof written
or telephonic notice (in the case of telephonic notice, promptly
confirmed in writing if so requested by the Administrative Agent) of
each Borrowing of Prime Rate Loans to be made hereunder.
Each such notice (each such notice, a "NOTICE OF BORROWING") shall (if requested
by the Administrative Agent to be confirmed in writing), be substantially in the
form of Exhibit B-1, and in any event shall be irrevocable and shall specify:
(i) the aggregate principal amount of the Loans to be made pursuant to such
Borrowing; (ii) the date of the Borrowing (which shall be a Business Day); (iii)
whether the Borrowing shall consist of Prime Rate Loans or Eurodollar Loans; and
(iv) if the requested Borrowing consists of Eurodollar Loans, the Interest
Period to be initially applicable thereto. The Administrative Agent shall
promptly give each Lender written notice (or telephonic notice promptly
confirmed in writing) of each proposed Borrowing, of such Lender's proportionate
share thereof and of the other matters covered by the Notice of Borrowing
relating thereto.
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(b) Without in any way limiting the obligation of the Borrower to
confirm in writing any telephonic notice permitted to be given hereunder, the
Administrative Agent may act prior to receipt of written confirmation without
liability upon the basis of such telephonic notice believed by the
Administrative Agent in good faith to be from an Authorized Officer of the
Borrower entitled to give telephonic notices under this Agreement on behalf of
the Borrower. In each such case, the Administrative Agent's record of the terms
of such telephonic notice shall be conclusive absent manifest error.
2.4. DISBURSEMENT OF FUNDS. (a) No later than 2:00 P.M. (local time
at the Payment Office) on the date specified in each Notice of Borrowing
relating to Eurodollar Loans, and no later than 2:00 P.M. (local time at the
Payment Office) on the date specified in each Notice of Borrowing relating to
Prime Rate Loans, each Lender will make available its PRO RATA share of each
Borrowing requested to be made on such date in the manner provided below. All
amounts shall be made available to the Administrative Agent in U.S. dollars and
immediately available funds at the Payment Office and the Administrative Agent
promptly will make available to the Borrower by depositing to its account at the
Payment Office the aggregate of the amounts so made available in the type of
funds received. Unless the Administrative Agent shall have been notified by any
Lender prior to the date of Borrowing that such Lender does not intend to make
available to the Administrative Agent its portion of the Borrowing or Borrowings
to be made on such date, the Administrative Agent may assume that such Lender
has made such amount available to the Administrative Agent on such date of
Borrowing, and the Administrative Agent, in reliance upon such assumption, may
(in its sole discretion and without any obligation to do so) make available to
the Borrower a corresponding amount. If such corresponding amount is not in fact
made available to the Administrative Agent by such Lender and the Administrative
Agent has made available same to the Borrower, the Administrative Agent shall be
entitled to recover such corresponding amount from such Lender. If such Lender
does not pay such corresponding amount forthwith upon the Administrative Agent's
demand therefor, the Administrative Agent shall promptly notify the Borrower,
and the Borrower shall immediately pay such corresponding amount to the
Administrative Agent. The Administrative Agent shall also be entitled to recover
from such Lender or the Borrower, as the case may be, interest on such
corresponding amount in respect of each day from the date such corresponding
amount was made available by the Administrative Agent to the Borrower to the
date such corresponding amount is recovered by the Administrative Agent, at a
rate per annum equal to (x) if paid by such Lender, the overnight Federal Funds
Effective Rate or (y) if paid by the Borrower, the then applicable rate of
interest, calculated in accordance with section 2.7, for the respective Loans
(but without any requirement to pay any amounts in respect thereof pursuant to
section 2.10).
(b) Nothing herein and no subsequent termination of the
Commitments pursuant to section 4.2 or 4.3 shall be deemed to relieve any Lender
from its obligation to fulfill its commitments hereunder and in existence from
time to time or to prejudice any rights which the Borrower may have against any
Lender as a result of any default by such Lender hereunder.
2.5. NOTES. (a) The Borrower's obligation to pay the principal of,
and interest on, the Loans made to it by each Lender shall be evidenced by a
promissory note of the Borrower substantially in the form of Exhibit A (each a
"NOTE" and, collectively, the "NOTES").
(b) The Note issued by the Borrower to a Lender shall: (i) be
executed by the Borrower; (ii) be payable to the order of such Lender and be
dated on or prior to the date the first Loan outstanding thereunder is made;
(iii) be payable in the principal amount of Loans evidenced thereby; (iv) mature
on the Maturity Date; (v) bear interest as provided in section 2.7 in respect of
the Prime Rate Loans or Eurodollar Loans, as the case may be, evidenced thereby;
(vi) be subject to mandatory prepayment as provided in section 5.2; and (vii) be
entitled to the benefits of this Agreement and the other Credit Documents.
(c) Each Lender will note on its internal records the amount of
each Loan made by it and each payment in respect thereof and will, prior to any
transfer of its Note, endorse on the reverse side thereof or the grid attached
thereto the outstanding principal amount of Loans evidenced thereby. Failure to
make any such notation or any error in any such notation shall not affect the
Borrower's obligations in respect of such Loans.
2.6. CONVERSIONS. The Borrower shall have the option to convert on
any Business Day all or a portion at least equal to the applicable Minimum
Borrowing Amount of the outstanding principal amount of its Loans of one Type
owing by it into a Borrowing or Borrowings of another Type of Loans which can be
made hereunder, PROVIDED that: (i) no partial conversion of a Borrowing of
Eurodollar Loans shall reduce the outstanding principal amount of the Eurodollar
Loans made pursuant to such Borrowing to less than the Minimum Borrowing Amount
applicable thereto; (ii) any
18
conversion of Eurodollar Loans into Prime Rate Loans shall be made on, and only
on, the last day of an Interest Period for such Eurodollar Loans; (iii) Prime
Rate Loans may only be converted into Eurodollar Loans if no Default under
section 10.1(a) or Event of Default is in existence on the date of the
conversion unless the Required Lenders otherwise agree; and (iv) Borrowings of
Eurodollar Loans resulting from this section 2.6 shall conform to the
requirements of section 2.2. Each such conversion shall be effected by the
Borrower giving the Administrative Agent at its Notice Office, prior to 11:00
A.M. (local time at such Notice Office), at least three Business Days' (or prior
to 11:00 A.M. (local time at such Notice Office) same Business Day's, in the
case of a conversion into Prime Rate Loans) prior written notice (or telephonic
notice promptly confirmed in writing if so requested by the Administrative
Agent) (each a "NOTICE OF CONVERSION"), substantially in the form of Exhibit
B-2, specifying the Loans to be so converted, the Type of Loans to be converted
into and, if to be converted into a Borrowing of Eurodollar Loans, the Interest
Period to be initially applicable thereto. The Administrative Agent shall give
each Lender prompt notice of any such proposed conversion affecting any of its
Loans. For the avoidance of doubt, the prepayment or repayment of any Loans out
of the proceeds of other Loans by the Borrower is not considered a conversion of
Loans into other Loans.
2.7. INTEREST. (a) The unpaid principal amount of each Loan which
is a Prime Rate Loan shall bear interest from the date of the Borrowing thereof
until maturity (whether by acceleration or otherwise) at a fluctuating rate per
annum which shall at all times be equal to sum of the Prime Rate in effect from
time to time PLUS the Applicable Prime Rate Margin in effect from time to time.
(b) The unpaid principal amount of each Loan which is a Eurodollar
Loan shall bear interest from the date of the Borrowing thereof until maturity
(whether by acceleration or otherwise) at a rate per annum which shall at all
times be the Applicable Eurodollar Margin (as defined below) for such Loan PLUS
the relevant Eurodollar Rate.
(c) Notwithstanding the above provisions, if a Default under
section 10.1(a) or Event of Default is in existence, all outstanding amounts of
principal and, to the extent permitted by law, all overdue interest, in respect
of each Loan shall bear interest, payable on demand, at a fluctuating rate per
annum equal to 2% per annum above the rate in effect from time to time pursuant
to section 2.7(a). If any amount (other than the principal of and interest on
the Loans) payable by the Borrower under the Credit Documents is not paid when
due, such amount shall bear interest, payable on demand, at a fluctuating rate
per annum equal to 2% per annum above the rate in effect from time to time
pursuant to section 2.7(a).
(d) Interest shall accrue from and including the date of any
Borrowing to but excluding the date of any prepayment or repayment thereof and
shall be payable (i) in respect of each Prime Rate Loan, quarterly in arrears on
the last Business Day of each March, June, September and December, (ii) in
respect of each Eurodollar Loan, on the last day of each Interest Period
applicable thereto and in the case of an Interest Period in excess of three
months, on the dates which are successively three months after the commencement
of such Interest Period, and (iii) in respect of each Loan, on any prepayment or
conversion (on the amount prepaid or converted), at maturity (whether by
acceleration or otherwise) and, after such maturity, on demand.
(e) All computations of interest hereunder shall be made in
accordance with section 12.7(b).
(f) Each Reference Bank agrees to furnish the Administrative Agent
timely information for the purpose of determining the Eurodollar Rate for any
Borrowing consisting of Eurodollar Loans. If any one or more of the Reference
Banks shall not timely furnish such information, the Administrative Agent shall
determine the Eurodollar Rate on the basis of timely information furnished by
the remaining Reference Banks. The Administrative Agent upon determining the
interest rate for any Borrowing shall promptly notify the Borrower (on behalf of
any applicable Borrower) and the Lenders thereof.
(g) As used herein, the term "APPLICABLE EURODOLLAR MARGIN", as
applied to any Loan which is a Eurodollar Loan, and the term "APPLICABLE PRIME
RATE MARGIN", as applied to any Loan which is a Prime Rate Loan, means the
particular rate per annum determined by the Administrative Agent in accordance
with the Pricing Grid Table which appears below, based on the Borrower's ratio
of Consolidated Total Indebtedness to Consolidated EBITDA as referred to in
section 9.7, and following provisions:
(i) Initially, until changed hereunder in accordance with
the following provisions, the Applicable Eurodollar Margin will be 175
basis points and the Applicable Prime Rate Margin will be 25 basis
points.
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(ii) Subsequent to the fiscal quarter of the Borrower
ended on or nearest to December 31, 2001, the Administrative Agent will
determine the Applicable Eurodollar Margin and/or Applicable Prime Rate
Margin for any Loan in accordance with the Pricing Grid Table, based on
the Borrower's ratio of Consolidated Total Indebtedness to Consolidated
EBITDA as referred to in section 9.7 and identified in such Table.
Changes in the Applicable Eurodollar Margin and/or Applicable Prime
Rate Margin based upon changes in such ratio shall become effective on
the first day of the month following the receipt by the Administrative
Agent pursuant to section 8.1(a) or (b) of the financial statements of
the Borrower, accompanied by the certificate referred to in section
8.1(c), demonstrating the computation of such ratio, based upon the
ratio in effect at the end of the applicable period covered (in whole
or in part) by such financial statements.
(iii) Any changes in the Applicable Eurodollar Margin
and/or Applicable Prime Rate Margin shall be determined by the
Administrative Agent in accordance with the above provisions and the
Administrative Agent will promptly provide notice of such
determinations to the Borrower and the Lenders. Any such determination
by the Administrative Agent pursuant to this section 2.7(g) shall be
conclusive and binding absent manifest error.
PRICING GRID TABLE
(EXPRESSED IN BASIS POINTS)
RATIO OF APPLICABLE APPLICABLE APPLICABLE
CONSOLIDATED TOTAL INDEBTEDNESS/ EURODOLLAR PRIME RATE COMMITMENT FEE
CONSOLIDATED EBITDA MARGIN MARGIN RATE
-------------------------------- ---------- ---------- --------------
<2.00 to 1.00 175.00 25.00 50.00
------ ----- -----
=> 2.00 to 1.00 200.00 50.00 50.00
------ ----- -----
2.8. INTEREST PERIODS. (a) At the time the Borrower gives a Notice
of Borrowing or Notice of Conversion in respect of the making of, or conversion
into, a Borrowing of Eurodollar Loans (in the case of the initial Interest
Period applicable thereto) or prior to 11:00 A.M. (local time at the applicable
Notice Office) on the third Business Day prior to the expiration of an Interest
Period applicable to a Borrowing of Eurodollar Loans, it shall have the right to
elect by giving the Administrative Agent written or telephonic notice (in the
case of telephonic notice, promptly confirmed in writing if so requested by the
Administrative Agent) of the Interest Period applicable to such Borrowing, which
Interest Period shall, at the option of the Borrower, be a one, two, three or
six month period. Notwithstanding anything to the contrary contained above:
(i) the initial Interest Period for any Borrowing of
Eurodollar Loans shall commence on the date of such Borrowing
(including the date of any conversion from a Borrowing of Prime Rate
Loans) and each Interest Period occurring thereafter in respect of such
Borrowing shall commence on the day on which the next preceding
Interest Period expires;
(ii) if any Interest Period begins on a day for which
there is no numerically corresponding day in the calendar month at the
end of such Interest Period, such Interest Period shall end on the last
Business Day of such calendar month;
(iii) if any Interest Period would otherwise expire on a
day which is not a Business Day, such Interest Period shall expire on
the next succeeding Business Day, PROVIDED that if any Interest Period
would otherwise expire on a day which is not a Business Day but is a
day of the month after which no further Business Day occurs in such
month, such Interest Period shall expire on the next preceding Business
Day;
(iv) no Interest Period for any Loan may be selected which
would end after the Maturity Date; and
(v) no Interest Period may be elected at any time when a
Default under section 10.1(a) or an Event of Default is then in
existence unless the Required Lenders otherwise agree.
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(b) If upon the expiration of any Interest Period the Borrower has
failed to (or may not) elect a new Interest Period to be applicable to the
respective Borrowing of Eurodollar Loans as provided above, the Borrower shall
be deemed to have elected to convert such Borrowing to Prime Rate Loans
effective as of the expiration date of such current Interest Period.
2.9. INCREASED COSTS, ILLEGALITY, ETC. (a) In the event that (x) in
the case of clause (i) below, the Administrative Agent or (y) in the case of
clauses (ii) and (iii) below, any Lender, shall have determined on a reasonable
basis (which determination shall, absent manifest error, be final and conclusive
and binding upon all parties hereto):
(i) on any date for determining the Eurodollar Rate for
any Interest Period that, by reason of any changes arising after the
Effective Date affecting the interbank Eurodollar market, adequate and
fair means do not exist for ascertaining the applicable interest rate
on the basis provided for in the definition of Eurodollar Rate; or
(ii) at any time, that such Lender shall incur increased
costs or reductions in the amounts received or receivable hereunder in
an amount which such Lender deems material with respect to any
Eurodollar Loans (other than any increased cost or reduction in the
amount received or receivable resulting from the imposition of or a
change in the rate of taxes or similar charges) because of (x) any
change since the Effective Date in any applicable law, governmental
rule, regulation, guideline, order or request (whether or not having
the force of law), or in the interpretation or administration thereof
and including the introduction of any new law or governmental rule,
regulation, guideline, order or request (such as, for example, but not
limited to, a change in official reserve requirements, but, in all
events, excluding reserves includable in the Eurodollar Rate pursuant
to the definition thereof) and/or (y) other circumstances adversely
affecting the interbank Eurodollar market or the position of such
Lender in such market; or
(iii) at any time, that the making or continuance of any
Eurodollar Loan has become unlawful by compliance by such Lender in
good faith with any change since the Effective Date in any law,
governmental rule, regulation, guideline or order, or the official
interpretation or application thereof, or would conflict with any
thereof not having the force of law but with which such Lender
customarily complies or has become impracticable as a result of a
contingency occurring after the Effective Date which materially
adversely affects the interbank Eurodollar market;
THEN, and in any such event, such Lender (or the Administrative Agent in the
case of clause (i) above) shall (x) on or promptly following such date or time
and (y) within 10 Business Days of the date on which such event no longer exists
give notice (by telephone confirmed in writing) to the Borrower and to the
Administrative Agent of such determination (which notice the Administrative
Agent shall promptly transmit to each of the other Lenders). Thereafter (x) in
the case of clause (i) above, Eurodollar Loans shall no longer be available
until such time as the Administrative Agent notifies the Borrower and the
Lenders that the circumstances giving rise to such notice by the Administrative
Agent no longer exist, and any Notice of Borrowing or Notice of Conversion given
by the Borrower with respect to Eurodollar Loans which have not yet been
incurred or converted shall be deemed rescinded by the Borrower or, in the case
of a Notice of Borrowing, shall, at the option of the Borrower, be deemed
converted into a Notice of Borrowing for Prime Rate Loans to be made on the date
of Borrowing contained in such Notice of Borrowing, (y) in the case of clause
(ii) above, the Borrower shall pay to such Lender, upon written demand therefor,
such additional amounts (in the form of an increased rate of, or a different
method of calculating, interest or otherwise as such Lender shall determine) as
shall be required to compensate such Lender, for such increased costs or
reductions in amounts receivable hereunder (a written notice as to the
additional amounts owed to such Lender, showing the basis for the calculation
thereof, which basis must be reasonable, submitted to the Borrower by such
Lender shall, absent manifest error, be final and conclusive and binding upon
all parties hereto) and (z) in the case of clause (iii) above, the Borrower
shall take one of the actions specified in section 2.9(b) as promptly as
possible and, in any event, within the time period required by law.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in section 2.9(a)(ii) or (iii), the Borrower may (and in
the case of a Eurodollar Loan affected pursuant to section 2.9(a)(iii) the
Borrower shall) either (i) if the affected Eurodollar Loan is then being made
pursuant to a Borrowing, by giving the Administrative Agent telephonic notice
(confirmed promptly in writing) thereof on the same date that the Borrower was
notified by a Lender pursuant to section 2.9(a)(ii) or (iii), cancel said
Borrowing, convert the related Notice of Borrowing into one requesting a
Borrowing of Prime Rate Loans or require the affected Lender to make its
requested Loan as a Prime Rate Loan, or (ii) if
21
the affected Eurodollar Loan is then outstanding, upon at least one Business
Day's notice to the Administrative Agent, require the affected Lender to convert
each such Eurodollar Loan into a Prime Rate Loan, PROVIDED that if more than one
Lender is affected at any time, then all affected Lenders must be treated the
same pursuant to this section 2.9(b).
(c) If any Lender shall have determined that after the Effective
Date, the adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged by law with the interpretation or administration thereof, or
compliance by such Lender or its parent corporation with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such authority, central bank, or comparable agency, in each case made
subsequent to the Effective Date, has or would have the effect of reducing by an
amount reasonably deemed by such Lender to be material the rate of return on
such Lender's or its parent corporation's capital or assets as a consequence of
such Lender's commitments or obligations hereunder to a level below that which
such Lender or its parent corporation could have achieved but for such adoption,
effectiveness, change or compliance (taking into consideration such Lender's or
its parent corporation's policies with respect to capital adequacy), then from
time to time, within 15 days after demand by such Lender (with a copy to the
Administrative Agent), the Borrower shall pay to such Lender such additional
amount or amounts as will compensate such Lender or its parent corporation for
such reduction. Each Lender, upon determining in good faith that any additional
amounts will be payable pursuant to this section 2.9(c), will give prompt
written notice thereof to the Borrower, which notice shall set forth, in
reasonable detail, the basis of the calculation of such additional amounts,
which basis must be reasonable, although the failure to give any such notice
shall not release or diminish any of the Borrower's obligations to pay
additional amounts pursuant to this section 2.9(c) upon the subsequent receipt
of such notice.
(d) Notwithstanding anything in this Agreement to the contrary,
(i) no Lender shall be entitled to compensation or payment or reimbursement of
other amounts under section 2.9 or 3.5 for any amounts incurred or accruing more
than 90 days prior to the giving of notice to the Borrower of additional costs
or other amounts of the nature described in such sections, and (ii) no Lender
shall demand compensation for any reduction referred to in section 2.9(c) or
payment or reimbursement of other amounts under section 3.5 if it shall not at
the time be the general policy or practice of such Lender to demand such
compensation, payment or reimbursement in similar circumstances under comparable
provisions of other credit agreements.
2.10. COMPENSATION. The Borrower shall compensate each applicable
Lender, upon its written request (which request shall set forth the detailed
basis for requesting and the method of calculating such compensation), for all
reasonable losses, expenses and liabilities (including, without limitation, any
loss, expense or liability incurred by reason of the liquidation or reemployment
of deposits or other funds required by such Lender to fund its Eurodollar Loans)
which such Lender may sustain: (i) if for any reason (other than a default by
such Lender or the Administrative Agent) a Borrowing of Eurodollar Loans does
not occur on a date specified therefor in a Notice of Borrowing or Notice of
Conversion (whether or not withdrawn by the Borrower or deemed withdrawn
pursuant to section 2.9(a)); (ii) if any repayment, prepayment or conversion of
any of its Eurodollar Loans occurs on a date which is not the last day of an
Interest Period applicable thereto; (iii) if any prepayment of any of its
Eurodollar Loans is not made on any date specified in a notice of prepayment
given by the Borrower; or (iv) as a consequence of (x) any other default by the
Borrower to repay its Eurodollar Loans when required by the terms of this
Agreement or (y) an election made pursuant to section 2.9(b).
2.11. CHANGE OF LENDING OFFICE; REPLACEMENT OF LENDERS. (a) Each
Lender agrees that, upon the occurrence of any event giving rise to the
operation of section 2.9(a)(ii) or (iii), 2.9(c) or 3.5 with respect to such
Lender, it will, if requested by the Borrower, use reasonable efforts (subject
to overall policy considerations of such Lender) to designate another Applicable
Lending Office for any Loans or Commitment affected by such event, PROVIDED that
such designation is made on such terms that such Lender and its Applicable
Lending Office suffer no economic, legal or regulatory disadvantage, with the
object of avoiding the consequence of the event giving rise to the operation of
any such section.
(b) If any Lender requests any compensation, reimbursement or
other payment under section 2.9(a)(ii) or (iii), 2.9(c) or 3.5 with respect to
such Lender, or if any Lender is a Defaulting Lender, then the Borrower may, at
its sole expense and effort, upon notice to such Lender and the Administrative
Agent, require such Lender to assign and delegate, without recourse (in
accordance with the restrictions contained in section 12.4(b)), all its
interests, rights and obligations under this Agreement to an assignee that shall
assume such obligations (which assignee may be another Lender, if a Lender
accepts such assignment); PROVIDED that (i) the Borrower shall have received the
prior written consent of the
22
Administrative Agent, which consent shall not be unreasonably withheld, (iiA
such Lender shall have received payment of an amount equal to the outstanding
principal of its Loans, accrued interest thereon, accrued fees and all other
amounts payable to it hereunder, from the assignee (to the extent of such
outstanding principal and accrued interest and fees) or the Borrower (in the
case of all other amounts), and (iii) in the case of any such assignment
resulting from a claim for compensation, reimbursement or other payments
required to be made under section 2.9(a)(ii) or (iii), 2.9(c) or 3.5 with
respect to such Lender, such assignment will result in a reduction in such
compensation, reimbursement or payments. A Lender shall not be required to make
any such assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the Borrower to require
such assignment and delegation cease to apply.
(c) Nothing in this section 2.11 shall affect or postpone any of
the obligations of the Borrower or the right of any Lender provided in section
2.9 or 3.5.
SECTION 3. LETTERS OF CREDIT.
3.1. LETTERS OF CREDIT. (a) Subject to and upon the terms and
conditions herein set forth, the Borrower may request a Letter of Credit Issuer
at any time and from time to time on or after the Closing Date and prior to the
date that is 15 Business Days prior to the Maturity Date to issue, for the
account of the Borrower or any of its Subsidiaries and in support of worker
compensation, liability insurance, releases of contract retention obligations,
contract performance guarantee requirements and other bonding obligations of the
Borrower or any such Subsidiary incurred in the ordinary course of its business,
and such other standby obligations of the Borrower and its Subsidiaries that are
acceptable to the Letter of Credit Issuer, and subject to and upon the terms and
conditions herein set forth, such Letter of Credit Issuer agrees to issue from
time to time, irrevocable standby letters of credit denominated and payable in
Dollars in such form as may be approved by such Letter of Credit Issuer and the
Administrative Agent (each such letter of credit (and each Existing Letter of
Credit described in section 3.1(d)), a "LETTER OF CREDIT" and collectively, the
"LETTERS OF CREDIT").
(b) Notwithstanding the foregoing, (i) no Letter of Credit shall
be issued the Stated Amount of which, when added to the Letter of Credit
Outstandings at such time, would exceed either (x) $5,000,000, or (y) when added
to the aggregate principal amount of all Loans then outstanding, an amount equal
to the Total Commitment at such time; (ii) no Letter of Credit shall be issued
if at the time of the proposed issuance thereof the Borrower would be prohibited
from incurring additional Loans in an equivalent amount pursuant to section
2.1(d); (iii) no individual Letter of Credit (other than any Existing Letter of
Credit) shall be issued which has an initial Stated Amount less than $100,000
unless such lesser Stated Amount is acceptable to the Letter of Credit Issuer;
and (iv) each Letter of Credit shall have an expiry date (including any renewal
periods) occurring not later than the earlier of (A) one year from the date of
issuance thereof, unless a longer period is approved by the relevant Letter of
Credit Issuer and Lenders (other than any Defaulting Lender) holding a majority
of the Total Commitment, and (B) 15 Business Days prior to the Maturity Date, in
each case on terms acceptable to the Administrative Agent and the relevant
Letter of Credit Issuer.
(c) Notwithstanding the foregoing, in the event a Lender Default
exists, no Letter of Credit Issuer shall be required to issue any Letter of
Credit unless either (i) such Letter of Credit Issuer has entered into
arrangements satisfactory to it and the Borrower to eliminate such Letter of
Credit Issuer's risk with respect to the participation in Letters of Credit of
the Defaulting Lender or Lenders, including by cash collateralizing such
Defaulting Lender's or Lenders' Percentage of the Letter of Credit Outstandings;
or (ii) the issuance of such Letter of Credit, taking into account the potential
failure of the Defaulting Lender or Lenders to risk participate therein, will
not cause the Letter of Credit Issuer to incur aggregate credit exposure
hereunder with respect to Loans and Letter of Credit Outstandings in excess of
its Commitment, and the Borrower has undertaken, for the benefit of such Letter
of Credit Issuer, pursuant to an instrument satisfactory in form and substance
to such Letter of Credit Issuer, not to thereafter incur Loans or Letter of
Credit Outstandings hereunder which would cause the Letter of Credit Issuer to
incur aggregate credit exposure hereunder with respect to Loans and Letter of
Credit Outstandings in excess of its Commitment.
(d) Annex VI hereto contains a description of all letters of
credit outstanding on, and to continue in effect after, the Closing Date. Each
such letter of credit issued by a bank that is or becomes a Lender under this
Agreement on the Effective Date (each, an "EXISTING LETTER OF CREDIT") shall
constitute a "Letter of Credit" for all purposes of this Agreement, issued, for
purposes of section 3.4(a), on the Closing Date, and the Borrower, the
Administrative Agent and the applicable Lenders hereby agree that, from and
after such date, the terms of this Agreement shall apply to such Letters of
Credit, superseding any other agreement theretofore applicable to them to the
extent inconsistent with the terms hereof.
23
3.2. LETTER OF CREDIT REQUESTS: NOTICES OF ISSUANCE. (a) Whenever
it desires that a Letter of Credit be issued, the Borrower shall give the
Administrative Agent and the Letter of Credit Issuer written or telephonic
notice (in the case of telephonic notice, promptly confirmed in writing if so
requested by the Administrative Agent) which, if in the form of written notice
shall be substantially in the form of Exhibit B-3, or transmit by electronic
communication (if arrangements for doing so have been approved by the Letter of
Credit Issuer), prior to 11:00 A.M. (local time at its Notice Office) at least
three Business Days (or such shorter period as may be acceptable to the relevant
Letter of Credit Issuer) prior to the proposed date of issuance (which shall be
a Business Day) (each a "LETTER OF CREDIT REQUEST"), which Letter of Credit
Request shall include such supporting documents that such Letter of Credit
Issuer customarily requires in connection therewith (including, in the case of a
Letter of Credit for an account party other than the Borrower, an application
for, and if applicable a reimbursement agreement with respect to, such Letter of
Credit). Any such documents executed in connection with the issuance of a Letter
of Credit, including the Letter of Credit itself, are herein referred to as
"LETTER OF CREDIT DOCUMENTS". In the event of any inconsistency between any of
the terms or provisions of any Letter of Credit Document and the terms and
provisions of this Agreement respecting Letters of Credit, the terms and
provisions of this Agreement shall control. The Administrative Agent shall
promptly notify each Lender of each Letter of Credit Request.
(b) Each Letter of Credit Issuer shall provide to the
Administrative Agent and each other Lender a quarterly (or monthly if requested
by the Administrative Agent or any applicable Lender) summary describing each
Letter of Credit issued by such Letter of Credit Issuer and then outstanding and
an identification for the relevant period of the daily aggregate Letter of
Credit Outstandings represented by Letters of Credit issued by such Letter of
Credit Issuer. Each Letter of Credit Issuer shall, if requested by the
Administrative Agent or any other Lender, provide a copy of each Letter of
Credit issued by it.
3.3. AGREEMENT TO REPAY LETTER OF CREDIT DRAWINGS. (a) The Borrower
hereby agrees to reimburse (or cause any Subsidiary for whose account a Letter
of Credit was issued to reimburse) each Letter of Credit Issuer, by making
payment directly to such Letter of Credit Issuer in immediately available funds
at the payment office of such Letter of Credit Issuer, for any payment or
disbursement made by such Letter of Credit Issuer under any Letter of Credit
(each such amount so paid or disbursed until reimbursed, an "UNPAID DRAWING")
not later than the Business Day immediately following the Business Day on which
such Letter of Credit Issuer notifies the Borrower (or any such Subsidiary for
whose account such Letter of Credit was issued) of such payment or disbursement
(which notice to the Borrower (or such Subsidiary) shall be delivered reasonably
promptly after any such payment or disbursement), such payment to be made in
Dollars, with interest on the amount so paid or disbursed by such Letter of
Credit Issuer, to the extent not reimbursed prior to 1:00 P.M. (local time at
the payment office of the Letter of Credit Issuer) on the date of such payment
or disbursement, from and including the date paid or disbursed to but not
including the date such Letter of Credit Issuer is reimbursed therefor at a rate
per annum which shall be the rate then applicable to Loans which are Prime Rate
Loans (plus an additional 2% per annum if not reimbursed by the third Business
Day after the date of such payment or disbursement), any such interest also to
be payable on demand. If by 11:00 A.M. on the Business Day immediately following
notice to it of its obligation to make reimbursement in respect of an Unpaid
Drawing, the Borrower has not made such reimbursement out of its available cash
on hand or a contemporaneous Borrowing hereunder, (x) the Borrower will be
deemed to have given a Notice of Borrowing for Prime Rate Loans in an aggregate
principal amount sufficient to reimburse such Unpaid Drawing (and the
Administrative Agent shall promptly give notice to the Lenders of such deemed
Notice of Borrowing), (y) the Lenders shall, unless they are legally prohibited
from doing so, make the Loans contemplated by such deemed Notice of Borrowing
(which Loans shall be considered made under section 2.1 hereof), and (z) the
proceeds of such Prime Rate Loans shall be disbursed directly to the applicable
Letter of Credit Issuer to the extent necessary to effect such reimbursement,
with any excess proceeds to be made available to the Borrower in accordance with
the applicable provisions of this Agreement.
(b) The Borrower's obligation under this section 3.3 to reimburse,
or cause a Subsidiary to reimburse, each Letter of Credit Issuer with respect to
Unpaid Drawings (including, in each case, interest thereon) shall be absolute
and unconditional under any and all circumstances and irrespective of any
setoff, counterclaim or defense to payment which the Borrower may have or have
had against such Letter of Credit Issuer, the Administrative Agent, any other
Letter of Credit Issuer or any Lender, including, without limitation, any
defense based upon the failure of any drawing under a Letter of Credit to
conform to the terms of the Letter of Credit or any non-application or
misapplication by the beneficiary of the proceeds of such drawing, PROVIDED,
HOWEVER that the Borrower shall not be obligated to reimburse, or cause a
Subsidiary to reimburse, a Letter of Credit Issuer for any wrongful payment made
by such Letter of Credit Issuer under a Letter of Credit as a result of acts or
omissions constituting willful misconduct or gross negligence on the part of
such Letter of Credit Issuer.
24
3.4. LETTER OF CREDIT PARTICIPATIONS. (a) Immediately upon the
issuance by a Letter of Credit Issuer of any Letter of Credit (and on the
Closing Date with respect to any Existing Letter of Credit), such Letter of
Credit Issuer shall be deemed to have sold and transferred to each Lender with a
Commitment, and each such Lender (each a "PARTICIPANT") shall be deemed
irrevocably and unconditionally to have purchased and received from such Letter
of Credit Issuer, without recourse or warranty, an undivided interest and
participation, to the extent of such Lender's Percentage, in such Letter of
Credit, each substitute letter of credit, each drawing made thereunder, the
obligations of the Borrower under this Agreement with respect thereto (although
Letter of Credit Fees shall be payable directly to the Administrative Agent for
the account of the Lenders as provided in section 4.1(b) and the Participants
shall have no right to receive any portion of any fees of the nature
contemplated by section 4.1(c)), the obligations of any Subsidiary of the
Borrower under any Letter of Credit Documents pertaining thereto, and any
security for, or guaranty pertaining to, any of the foregoing. Upon any change
in the Commitments of the Lenders pursuant to section 12.4(b), it is hereby
agreed that, with respect to all outstanding Letters of Credit and Unpaid
Drawings, there shall be an automatic adjustment to the participations pursuant
to this section 3.4 to reflect the new Percentages of the assigning and assignee
Lender.
(b) In determining whether to pay under any Letter of Credit, a
Letter of Credit Issuer shall not have any obligation relative to the
Participants other than to determine that any documents required to be delivered
under such Letter of Credit have been delivered and that they appear to comply
on their face with the requirements of such Letter of Credit. Any action taken
or omitted to be taken by a Letter of Credit Issuer under or in connection with
any Letter of Credit if taken or omitted in the absence of gross negligence or
willful misconduct, shall not create for such Letter of Credit Issuer any
resulting liability.
(c) In the event that a Letter of Credit Issuer makes any payment
under any Letter of Credit and the Borrower shall not have reimbursed (or caused
any applicable Subsidiary to reimburse) such amount in full to such Letter of
Credit Issuer pursuant to section 3.3(a), such Letter of Credit Issuer shall
promptly notify the Administrative Agent, and the Administrative Agent shall
promptly notify each Participant of such failure, and each Participant shall
promptly and unconditionally pay to the Administrative Agent for the account of
such Letter of Credit Issuer, the amount of such Participant's Percentage of
such payment in U.S. Dollars and in same day funds, PROVIDED, HOWEVER, that no
Participant shall be obligated to pay to the Administrative Agent its Percentage
of such unreimbursed amount for any wrongful payment made by such Letter of
Credit Issuer under a Letter of Credit as a result of acts or omissions
constituting willful misconduct or gross negligence on the part of such Letter
of Credit Issuer. If the Administrative Agent so notifies any Participant
required to fund a payment under a Letter of Credit prior to 11:00 A.M. (local
time at its Notice Office) on any Business Day, such Participant shall make
available to the Administrative Agent for the account of the relevant Letter of
Credit Issuer such Participant's Percentage of the amount of such payment on
such Business Day in same day funds. If and to the extent such Participant shall
not have so made its Percentage of the amount of such payment available to the
Administrative Agent for the account of the relevant Letter of Credit Issuer,
such Participant agrees to pay to the Administrative Agent for the account of
such Letter of Credit Issuer, forthwith on demand such amount, together with
interest thereon, for each day from such date until the date such amount is paid
to the Administrative Agent for the account of such Letter of Credit Issuer at
the Federal Funds Effective Rate. The failure of any Participant to make
available to the Administrative Agent for the account of the relevant Letter of
Credit Issuer its Percentage of any payment under any Letter of Credit shall not
relieve any other Participant of its obligation hereunder to make available to
the Administrative Agent for the account of such Letter of Credit Issuer its
Percentage of any payment under any Letter of Credit on the date required, as
specified above, but no Participant shall be responsible for the failure of any
other Participant to make available to the Administrative Agent for the account
of such Letter of Credit Issuer such other Participant's Percentage of any such
payment.
(d) Whenever a Letter of Credit Issuer receives a payment of a
reimbursement obligation as to which the Administrative Agent has received for
the account of such Letter of Credit Issuer any payments from the Participants
pursuant to section 3.4(c) above, such Letter of Credit Issuer shall pay to the
Administrative Agent and the Administrative Agent shall promptly pay to each
Participant which has paid its Percentage thereof, in U.S. dollars and in same
day funds, an amount equal to such Participant's Percentage of the principal
amount thereof and interest thereon accruing after the purchase of the
respective participations, as and to the extent so received.
(e) The obligations of the Participants to make payments to the
Administrative Agent for the account of each Letter of Credit Issuer with
respect to Letters of Credit shall be irrevocable and not subject to
counterclaim, set-off or other defense or any other qualification or exception
whatsoever and shall be made in accordance with the terms and conditions of this
Agreement under all circumstances, including, without limitation, any of the
following circumstances:
25
(i) any lack of validity or enforceability of this
Agreement or any of the other Credit Documents;
(ii) the existence of any claim, set-off defense or other
right which the Borrower (or any Subsidiary) may have at any time
against a beneficiary named in a Letter of Credit, any transferee of
any Letter of Credit (or any person for whom any such transferee may be
acting), the Administrative Agent, any Letter of Credit Issuer, any
Lender, or other person, whether in connection with this Agreement, any
Letter of Credit, the transactions contemplated herein or any unrelated
transactions (including any underlying transaction between the Borrower
(or any Subsidiary) and the beneficiary named in any such Letter of
Credit), other than any claim which the Borrower (or any Subsidiary
which is the account party with respect to a Letter of Credit) may have
against any applicable Letter of Credit Issuer for gross negligence or
willful misconduct of such Letter of Credit Issuer in making payment
under any applicable Letter of Credit;
(iii) any draft, certificate or other document presented
under the Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit
Documents: or
(v) the occurrence of any Default or Event of Default.
(f) To the extent the Letter of Credit Issuer is not indemnified
by the Borrower, the Participants will reimburse and indemnify the Letter of
Credit Issuer, in proportion to their respective Percentages, for and against
any and all liabilities, obligations, losses, damages, penalties, claims,
actions, judgments, costs, expenses or disbursements of whatsoever kind or
nature which may be imposed on, asserted against or incurred by the Letter of
Credit Issuer in performing its respective duties in any way related to or
arising out of its issuance of Letters of Credit, PROVIDED that no Participants
shall be liable for any portion of such liabilities, obligations, losses,
damages, penalties, claims, actions, judgments, costs, expenses or disbursements
resulting from the Letter of Credit Issuer's gross negligence or willful
misconduct.
3.5. INCREASED COSTS. If after the Effective Date, the adoption of
any applicable law, rule or regulation, or any change therein, or any change in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Letter of Credit Issuer or any
Lender with any request or directive (whether or not having the force of law) by
any such authority, central bank or comparable agency (in each case made
subsequent to the Effective Date) shall either (i) impose, modify or make
applicable any reserve, deposit, capital adequacy or similar requirement against
Letters of Credit issued by such Letter of Credit Issuer or such Lender's
participation therein, or (ii) shall impose on such Letter of Credit Issuer or
any Lender any other conditions affecting this Agreement, any Letter of Credit
or such Lender's participation therein; and the result of any of the foregoing
is to increase the cost to such Letter of Credit Issuer or such Lender of
issuing, maintaining or participating in any Letter of Credit, or to reduce the
amount of any sum received or receivable by such Letter of Credit Issuer or such
Lender hereunder (other than any increased cost or reduction in the amount
received or receivable resulting from the imposition of or a change in the rate
of taxes or similar charges), then, upon demand to the Borrower by such Letter
of Credit Issuer or such Lender (a copy of which notice shall be sent by such
Letter of Credit Issuer or such Lender to the Administrative Agent), the
Borrower shall pay to such Letter of Credit Issuer or such Lender such
additional amount or amounts as will compensate any such Letter of Credit Issuer
or such Lender for such increased cost or reduction. A certificate submitted to
the Borrower by any Letter of Credit Issuer or any Lender, as the case may be (a
copy of which certificate shall be sent by such Letter of Credit Issuer or such
Lender to the Administrative Agent), setting forth, in reasonable detail, the
basis for the determination of such additional amount or amounts necessary to
compensate any Letter of Credit Issuer or such Lender as aforesaid shall be
conclusive and binding on the Borrower absent manifest error, although the
failure to deliver any such certificate shall not release or diminish any of the
Borrower's obligations to pay additional amounts pursuant to this section 3.5.
Reference is hereby made to the provisions of sections 2.9(d) and 2.11 for
certain limitations upon the rights of a Letter of Credit Issuer or Lender under
this section.
3.6. GUARANTY OF SUBSIDIARY LETTER OF CREDIT OBLIGATIONS. (a) The
Borrower hereby unconditionally guarantees, for the benefit of the
Administrative Agent and the Lenders, the full and punctual payment of the
Obligations of each Subsidiary under each Letter of Credit Document to which
such Subsidiary is now or hereafter becomes a party.
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Upon failure by any such Subsidiary to pay punctually any such amount, the
Borrower shall forthwith on demand by the Administrative Agent pay the amount
not so paid at the place and in the currency and otherwise in the manner
specified in this Agreement or any applicable Letter of Credit Document.
(b) As a separate, additional and continuing obligation, the
Borrower unconditionally and irrevocably undertakes and agrees, for the benefit
of the Administrative Agent and the Lenders, that, should any amounts not be
recoverable from the Borrower under section 3.6(a) for any reason whatsoever
(including, without limitation, by reason of any provision of any Credit
Document or any other agreement or instrument executed in connection therewith
being or becoming void, unenforceable, or otherwise invalid under any applicable
law) then, notwithstanding any notice or knowledge thereof by any Lender, the
Administrative Agent, any of their respective Affiliates, or any other person,
at any time, the Borrower as sole, original and independent obligor, upon demand
by the Administrative Agent, will make payment to the Administrative Agent, for
the account of the Lenders and the Administrative Agent, of all such obligations
not so recoverable by way of full indemnity, in such currency and otherwise in
such manner as is provided in the Credit Documents.
(c) The obligations of the Borrower under this section shall be
unconditional and absolute and, without limiting the generality of the foregoing
shall not be released, discharged or otherwise affected by the occurrence, one
or more times, of any of the following:
(i) any extension, renewal, settlement, compromise,
waiver or release in respect to any obligation of any Subsidiary under
any Letter of Credit Document, by operation of law or otherwise;
(ii) any modification or amendment of or supplement to
this Agreement, any Note or any other Credit Document;
(iii) any release, non-perfection or invalidity of any
direct or indirect security for any obligation of the Borrower under
this Agreement, any Note or any other Credit Document or of any
Subsidiary under any Letter of Credit Document;
(iv) any change in the corporate existence, structure or
ownership of any Subsidiary or any insolvency, bankruptcy,
reorganization or other similar proceeding affecting any Subsidiary or
its assets or any resulting release or discharge of any obligation of
any Subsidiary contained in any Letter of Credit Document;
(v) the existence of any claim, set-off or other rights
which the Borrower may have at any time against any Subsidiary, the
Administrative Agent, any Lender or any other person, whether in
connection herewith or any unrelated transactions;
(vi) any invalidity or unenforceability relating to or
against any Subsidiary for any reason of any Letter of Credit Document,
or any provision of applicable law or regulation purporting to prohibit
the payment by any Subsidiary of any Obligations in respect of any
Letter of Credit; or
(vii) any other act or omission to act or delay of any kind
by any Subsidiary, the Administrative Agent, any Lender or any other
person or any other circumstance whatsoever which might, but for the
provisions of this section, constitute a legal or equitable discharge
of the Borrower's obligations under this section.
(d) The Borrower's obligations under this section shall remain in
full force and effect until the Commitments shall have terminated and the
principal of and interest on the Notes and all other amounts payable by the
Borrower under the Credit Documents and by any Subsidiary under the Letter of
Credit Documents shall have been paid in full. If at any time any payment of any
of the Obligations of any Subsidiary in respect of any Letter of Credit
Documents is rescinded or must be otherwise restored or returned upon the
insolvency, bankruptcy or reorganization of such Subsidiary, the Borrower's
obligations under this section with respect to such payment shall be reinstated
at such time as though such payment had been due but not made at such time.
(e) The Borrower irrevocably waives acceptance hereof,
presentment, demand, protest and any notice not provided for herein, as well as
any requirement that at any time any action be taken by any person against any
Subsidiary or any other person, or against any collateral or guaranty of any
other person.
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(f) The Borrower hereby subordinates all rights, whether arising
by operation of law or otherwise, which it may have upon making any payment
under this section to be subrogated to the rights of the payee against any
Subsidiary with respect to such payment or otherwise to be reimbursed,
indemnified or exonerated by any Subsidiary in respect thereof, to the
indefeasible payment in full of all of the Obligations.
(g) In the event that acceleration of the time for payment of any
amount payable by any Subsidiary under any Letter of Credit Document is stayed
upon insolvency, bankruptcy or reorganization of such Subsidiary, all such
amounts otherwise subject to acceleration under the terms of any applicable
Letter of Credit Document shall nonetheless be payable by the Borrower under
this section forthwith on demand by the Administrative Agent.
SECTION 4. FEES; COMMITMENTS.
4.1. FEES. (a) The Borrower agrees to pay to the Administrative
Agent a commitment fee (the "COMMITMENT FEE") for the account of each
Non-Defaulting Lender for the period from and including the Effective Date to,
but not including, the Maturity Date or, if earlier, the date upon which the
Total Commitment has been terminated, computed for each day at a rate per annum
equal to the Applicable Commitment Fee Rate for such day on such Lender's
Unutilized Commitment for such day. The Commitment Fee shall be due and payable
in arrears on the last Business Day of each June, September, December and March
and on the Maturity Date or, if earlier, the date upon which the Total
Commitment has been terminated.
As used herein, the term "APPLICABLE COMMITMENT FEE RATE" means 50
basis points.
(b) The Borrower agrees to pay to the Administrative Agent, for
the account of each Non-Defaulting Lender, PRO RATA on the basis of its
Percentage, a fee in respect of each Letter of Credit (the "LETTER OF CREDIT
FEE"), payable on the date of issuance (or any increase in the amount, or
renewal or extension) thereof, computed at the rate per annum equal to the
Applicable Eurodollar Margin then in effect on the Stated Amount thereof for the
period from the date of issuance (or increase, renewal or extension) to the
expiration date thereof (including any extensions of such expiration date which
may be made at the election of the beneficiary thereof). Notwithstanding the
above provisions, if a Default under section 10.1(a) or Event of Default is in
existence, the Borrower will pay to the Administrative Agent, on demand, for the
account of each Non-Defaulting Lender, PRO RATA on the basis of its Percentage,
an additional Letter of Credit Fee, computed at 2% per annum on the Stated
Amount of each Letter of Credit for the period such Default or Event of Default
is in existence.
(c) The Borrower agrees to pay directly to each Letter of Credit
Issuer, for its own account, a fee in respect of each Letter of Credit issued by
it (a "FACING FEE"), payable on the date of issuance (or any increase in the
amount, or renewal or extension) thereof, computed at the rate of 1/8 of 1% per
annum on the Stated Amount thereof for the period from the date of issuance (or
increase, renewal or extension) to the expiration date thereof (including any
extensions of such expiration date which may be made at the election of the
beneficiary thereof).
(d) The Borrower agrees to pay directly to each Letter of Credit
Issuer upon each issuance of, drawing under, and/or amendment, extension,
renewal or transfer of, a Letter of Credit issued by it such amount as shall at
the time of such issuance, drawing, amendment, extension, renewal or transfer be
the administrative or processing charge which such Letter of Credit Issuer is
customarily charging for issuances of, drawings under or amendments, extensions,
renewals or transfers of, letters of credit issued by it.
(e) The Borrower agrees to pay to the Administrative Agent an
annual fee (the "ANNUAL FEE"), for the account of each Non-Defaulting Lender,
PRO RATA, on the basis of its Percentages, equal to 25 basis points on the Total
Commitment in effect at that time. The Annual Fee shall be due and payable in
advance on the Closing Date and on each anniversary thereof until the earlier of
(i) the Maturity Date or (ii) the date that the Total Commitment is terminated.
(f) The Borrower shall pay to the Administrative Agent on the
Effective Date and thereafter for its own account and/or for distribution to the
Lenders such fees as heretofore agreed by the Borrower and the Administrative
Agent.
(g) All computations of Fees shall be made in accordance with
section 12.7(b).
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4.2. VOLUNTARY TERMINATION/REDUCTION OF COMMITMENTS. Upon at least
three Business Days' prior written notice (or telephonic notice confirmed in
writing) to the Administrative Agent at its Notice Office (which notice the
Administrative Agent shall promptly transmit to each of the Lenders), the
Borrower shall have the right, without premium or penalty, to:
(a) terminate the Total Commitment, PROVIDED that all
outstanding Loans are contemporaneously prepaid in accordance with
section 5.1 and no Letters of Credit remain outstanding; and/or
(b) partially and permanently reduce the Unutilized Total
Commitment, PROVIDED that (i) any such reduction shall apply to
proportionately and permanently reduce the Commitment of each of the
Lenders; and (ii) any partial reduction of the Unutilized Total
Commitment pursuant to this section 4.2(b) shall be in the amount of at
least $5,000,000 (or, if greater, in integral multiples of $1,000,000).
4.3. MANDATORY TERMINATION/ADJUSTMENTS OF COMMITMENTS, ETC. (a) The
Total Commitment shall terminate (and the Commitment of each Lender shall
terminate) on the earlier of (x) the Maturity Date and (y) the date on which a
Change of Control occurs.
(b) The Total Commitment shall be permanently reduced, without
premium or penalty, at the time that any mandatory prepayment of Loans would be
made pursuant to section 5.2(b), 5.2(d), 5.2(e) and 5.2(f) if Loans are then
outstanding in an amount equal to the required prepayment of principal of Loans
which would be required to be made in such circumstance. Any such reduction
shall apply to proportionately and permanently reduce the Commitment of each of
the Lenders. The Borrower will provide at least three Business Days' prior
written notice (or telephonic notice confirmed in writing) to the Administrative
Agent at its Notice Office (which notice the Administrative Agent shall promptly
transmit to each of the Lenders), of any reduction of the Total Commitment
pursuant to this section 4.3(c), specifying the date and amount of the
reduction.
SECTION 5. PAYMENTS.
5.1. VOLUNTARY PREPAYMENTS. The Borrower shall have the right to
prepay any of its Loans, in whole or in part, without premium or penalty, from
time to time, but only on the following terms and conditions:
(i) the Borrower shall give the Administrative Agent at the
Notice Office written or telephonic notice (in the case of telephonic
notice, promptly confirmed in writing if so requested by the
Administrative Agent) of its intent to prepay the Loans, the amount of
such prepayment and (in the case of Eurodollar Loans) the specific
Borrowing(s) pursuant to which made, which notice shall be received by
the Administrative Agent by
(x) 11:00 A.M. (local time at the Notice Office)
three Business Days prior to the date of such prepayment, in
the case of any prepayment of Eurodollar Loans, or
(y) 12:00 noon (local time at the Notice Office)
on the date of such prepayment, in the case of any prepayment
of Prime Rate Loans, and which notice shall promptly be
transmitted by the Administrative Agent to each of the
affected Lenders;
(ii) each partial prepayment by the Borrower of any
Borrowing shall be in an aggregate principal amount of (A) at least
$500,000, or an integral multiple of $100,000 in excess thereof, in the
case of Loans which are Prime Rate Loans, or (B) at least $1,000,000,
or an integral multiple of $100,000 in excess thereof, in the case of
Loans which are Eurodollar Loans;
(iii) no partial prepayment of Eurodollar Loans of the
Borrower made pursuant to a Borrowing shall reduce the aggregate
principal amount of the Eurodollar Loans outstanding pursuant to such
Borrowing to an amount less than the Minimum Borrowing Amount
applicable thereto;
(iv) each prepayment in respect of any Loans made pursuant
to a Borrowing shall be applied PRO RATA among such Loans;
29
(v) if at the time of any prepayment of Loans pursuant to
this section 5.1 the Borrower shall have any installment payment
obligations under section 5.2(c), such prepayments shall be applied to
such installments in inverse order of maturity; and
(vi) each prepayment of Eurodollar Loans pursuant to this
section 5.1 on any date other than the last day of the Interest Period
applicable thereto shall be accompanied by any amounts payable in
respect thereof under section 2.10.
5.2. MANDATORY PREPAYMENTS. The Loans shall be subject to mandatory
prepayment in accordance with the following provisions:
(A) IF OUTSTANDING LOANS AND LETTER OF CREDIT
OUTSTANDINGS EXCEED MAXIMUM AVAILABILITY. If on any date (after giving
effect to any other payments on such date) the sum of (i) the aggregate
outstanding principal amount of Loans PLUS (ii) the aggregate amount of
Letter of Credit Outstandings, exceeds the Maximum Availability as then
in effect, the Borrower shall prepay on such date that principal amount
of Loans and, after Loans have been paid in full, Unpaid Drawings, in
an aggregate amount at least equal to such excess and conforming in the
case of partial prepayments of Loans to the requirements as to the
amounts of partial prepayments of Loans which are contained in section
5.1. If, after giving effect to the prepayment of Loans and Unpaid
Drawings, the aggregate amount of Letter of Credit Outstandings exceeds
the Maximum Availability as then in effect, the Borrower shall pay to
the Administrative Agent an amount in cash and/or Cash Equivalents
equal to such excess and the Administrative Agent shall hold such
payment as security for the reimbursement obligations of the Borrower
hereunder in respect of Letters of Credit pursuant to a cash collateral
agreement to be entered into in form and substance reasonably
satisfactory to the Administrative Agent and the Borrower (which shall
permit certain investments in Cash Equivalents satisfactory to the
Administrative Agent and the Borrower until the proceeds are applied to
the secured obligations).
(B) CERTAIN PROCEEDS OF ASSET SALES. If during any fiscal
year of the Borrower, the Borrower and its Subsidiaries have received
cumulative Cash Proceeds during such fiscal year from one or more Asset
Sales of at least $2,000,000, not later than the third Business Day
following the date of receipt of any Cash Proceeds in excess of such
amount, an amount, conforming to the requirements as to the amount of
partial prepayments contained in section 5.1, at least equal to 100% of
the Net Cash Proceeds then received in excess of such amount from any
Asset Sale, shall be applied as a mandatory prepayment of principal of
the outstanding Loans, and after the Loans have been repaid in full,
Unpaid Drawings; PROVIDED, that (i) if no Default under section 10.1(a)
or Event of Default shall have occurred and be continuing, (ii) the
Borrower and its Subsidiaries have scheduled Consolidated Capital
Expenditures during the following 12 months, and (iiiA the Borrower
notifies the Administrative Agent of the amount and nature thereof and
of its intention to reinvest all or a portion of such Net Cash Proceeds
in such Consolidated Capital Expenditures during such 12 month period,
then no such prepayment shall be required to the extent the Borrower so
indicates that such reinvestment will take place. If at the end of any
such 12 month period any portion of such Net Cash Proceeds has not been
so reinvested, the Borrower will immediately make a prepayment of the
outstanding Loans as provided above in an amount, conforming to the
requirements as to amount of prepayments contained in section 5.1, at
least equal to such remaining amount. Notwithstanding the foregoing,
the Borrower will not be required to make a prepayment in connection
with its sale of the property identified on Annex VIII, nor will the
Total Commitment be reduced in connection with such sale.
(C) IF GROSS RECOVERIES IN PROCESS ARE LESS THAN MINIMUM
GROSS RECOVERIES IN PROCESS. If as of the end of the Borrower's most
recent fiscal quarter (x) the Borrower's Gross Recoveries in Process at
the end of such fiscal quarter are less than the Minimum Gross
Recoveries in Process at such time, and (y) the sum at the end of such
fiscal quarter of the aggregate outstanding Loans and the Letter of
Credit Outstandings exceeds 5% of the Borrower's Gross Recoveries in
Process as of the end of such fiscal quarter (such excess amount, the
"Excess Amount"), the Borrower shall
(i) promptly, and in any event within 30 days
following the end of such fiscal quarter notify the
Administrative Agent of such condition, specifying in
reasonable detail the computation of such Excess Amount (and
the Administrative Agent shall in turn notify the Lenders
thereof), and
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(ii) prepay outstanding Loans on the last
Business Day of each March, June, September and December
thereafter in an aggregate principal amount at least equal to
1/20th of such Excess Amount;
PROVIDED that if as of the end of any subsequent fiscal quarter of the
Borrower the condition specified in clauses (x) and (y) above does not
then exist, the Borrower shall notify the Administrative Agent thereof,
specifying in reasonable detail the computation of the Gross Recoveries
in Process and the Minimum Gross Recoveries in Process (and the
Administrative Agent shall in turn notify the Lenders thereof),
whereupon the Borrower shall be relieved of its obligation to prepay
Loans because of such earlier Excess Amount, subject to the application
of this section 5.2(c) to circumstances which may exist at any future
time as to future Excess Amounts as provided herein.
(D) CERTAIN PROCEEDS OF EQUITY SALES. Not later than the
third Business Day following the date of the receipt by the Borrower or
any Subsidiary of the cash proceeds (net of underwriting discounts and
commissions, placement agent fees and other customary fees and costs
associated therewith) from any sale or issuance of equity securities by
the Borrower after the Closing Date (other than any sale or issuance to
management, employees (or key employees) or directors pursuant to stock
option, stock grant or similar plans for the benefit of management,
employees (or key employees) or directors generally), the Borrower will
prepay the principal of the outstanding Loans, and after the Loans have
been repaid in full, Unpaid Drawings, in an aggregate amount,
conforming to the requirements as to the amounts of partial prepayments
contained in section 5.1, equal to 50% of such net proceeds (or such
lesser amount as is then equal to the aggregate outstanding principal
amount of the Loans).
(E) CERTAIN PROCEEDS OF DEBT SECURITIES. Not later than
the third Business Day following the date of the receipt by the
Borrower or any Subsidiary of the cash proceeds (net of underwriting
discounts and commissions, placement agent fees and other customary
fees and costs associated therewith) from any sale or issuance of debt
securities by the Borrower after the Closing Date in an underwritten
public offering, Rule 144A offering, or private placement with one or
more institutional investors, the Borrower will prepay the principal of
the outstanding Loans, and after the Loans have been repaid in full,
Unpaid Drawings, in an aggregate amount, conforming to the requirements
as to the amounts of partial prepayments contained in section 5.1,
equal to 100% of such net proceeds (or such lesser amount as is then
equal to the aggregate outstanding principal amount of the Loans) and
the Total Commitment shall be permanently reduced by such amount.
Notwithstanding the foregoing, from and after the Closing
Date, the Borrower may sell or issue debt securities having an
aggregate principal amount of up to $20,000,000 in an underwritten
public offering, Rule 144A offering, or private placement with one or
more institutional investors, and no prepayment or reduction of the
Total Commitment shall be required under this section 5.2(e) in
connection therewith.
(F) CERTAIN PROCEEDS OF AN EVENT OF LOSS. If during any
fiscal year of the Borrower, the Borrower and its Subsidiaries have
received cumulative Net Cash Proceeds during such fiscal year from one
or more Events of Loss of at least $1,000,000, not later than the fifth
Business Day following the date of receipt of any Net Cash Proceeds in
excess of such amount, an amount, conforming to the requirements as to
the amount of partial prepayments contained in section 5.1, at least
equal to 100% of the Net Cash Proceeds then received in excess of such
amount from any Event of Loss, shall be applied as a mandatory
prepayment of principal of the outstanding Loans and the Total
Commitment shall be permanently reduced by such amount.
Notwithstanding the foregoing, in the event any property
suffers an Event of Loss and (i) the Net Cash Proceeds received in any
fiscal year as a result of such Event of Loss are more than $1,000,000,
(ii) no Default under section 10.1(a) or Event of Default has occurred
and is continuing, (iii) the Borrower's ratio of Consolidated Total
Indebtedness to Consolidated EBITDA as of the end of the most recent
Testing Period for which financial statements have been delivered to
the Lenders hereunder was not in excess of 2.50 to 1.00, and (iv) the
Borrower notifies the Administrative Agent and the Lenders in writing
that it intends to rebuild or restore the affected property, and that
such rebuilding or restoration can be accomplished within 18 months out
of such Net Cash Proceeds and other funds available to the Borrower,
THEN no such prepayment of the Loans shall be required if the Borrower
immediately deposits such Net Cash Proceeds in a cash collateral
deposit account over which the Collateral Agent shall have sole
dominion and control, and which shall constitute part of the Collateral
under the Security Documents and may be applied as provided in section
10.3 if an Event of Default occurs and
31
is continuing. So long as no Default under section 10.1(a) or Event of
Default has occurred and is continuing, the Collateral Agent is
authorized to disburse amounts from such cash collateral deposit
account to or at the direction of the Borrower for application to the
costs of rebuilding or restoration of the affected property. Any
amounts not so applied to the costs of rebuilding or restoration or as
provided in section 10.3 shall be applied to the prepayment of the
Loans and a mandatory reduction of the Total Commitment as provided
above.
(G) CHANGE OF CONTROL. On the date of which a Change of
Control occurs, notwithstanding anything to the contrary contained in
this Agreement, no further Borrowings shall be made and the then
outstanding principal amount of all Loans, if any, shall become due and
payable and shall be prepaid in full, and the Borrower shall
contemporaneously either (i) cause all outstanding Letters of Credit to
be surrendered for cancellation (any such Letters of Credit to be
replaced by letters of credit issued by other financial institutions
acceptable to the Required Lenders), or (ii) the Borrower shall pay to
the Administrative Agent an amount in cash and/or Cash Equivalents
equal to 100% of the Letter of Credit Outstandings and the
Administrative Agent shall hold such payment as security for the
reimbursement obligations of the Borrower hereunder in respect of
Letters of Credit pursuant to a cash collateral agreement to be entered
into in form and substance reasonably satisfactory to the
Administrative Agent and the Borrower (which shall permit certain
investments in Cash Equivalents satisfactory to the Administrative
Agent and the Borrower until the proceeds are applied to the secured
obligations).
(H) PARTICULAR LOANS TO BE PREPAID. With respect to each
repayment or prepayment of Loans required by this section 5.2, the
Borrower shall designate the Types of Loans which are to be prepaid and
the specific Borrowing(s) pursuant to which such repayment or
prepayment is to be made, PROVIDED that (iA the Borrower shall first so
designate all Loans that are Prime Rate Loans and Eurodollar Loans with
Interest Periods ending on the date of repayment or prepayment prior to
designating any other Eurodollar Loans for repayment or prepayment,
(ii) if the outstanding principal amount of Eurodollar Loans made
pursuant to a Borrowing is reduced below the applicable Minimum
Borrowing Amount as a result of any such repayment or prepayment, then
all the Loans outstanding pursuant to such Borrowing shall be converted
into Prime Rate Loans, and (iii) each repayment and prepayment of any
Loans made pursuant to a Borrowing shall be applied PRO RATA among such
Loans. In the absence of a designation by the Borrower as described in
the preceding sentence, the Administrative Agent shall, subject to the
above, make such designation in its sole discretion with a view, but no
obligation, to minimize breakage costs owing under section 2.10. Any
repayment or prepayment of Eurodollar Loans pursuant to this section
5.2 shall in all events be accompanied by such compensation as is
required by section 2.10.
5.3. METHOD AND PLACE OF PAYMENT. Except as otherwise specifically
provided herein, all payments under this Agreement shall be made to the
Administrative Agent for the ratable (based on its PRO RATA share) account of
the Lenders entitled thereto, not later than 11:00 A.M. (local time at the
Payment Office) on the date when due and shall be made in immediately available
funds and in lawful money of the United States of America at the Payment Office,
it being understood that written notice by the Borrower to the Administrative
Agent to make a payment from the funds in the Borrower's account at the Payment
Office shall constitute the making of such payment to the extent of such funds
held in such account. Any payments under this Agreement which are made later
than 11:00 A.M. (local time at the Payment Office) shall be deemed to have been
made on the next succeeding Business Day. Whenever any payment to be made
hereunder shall be stated to be due on a day which is not a Business Day, the
due date thereof shall be extended to the next succeeding Business Day and, with
respect to payments of principal, interest shall be payable during such
extension at the applicable rate in effect immediately prior to such extension.
5.4. NET PAYMENTS. (a) All payments made by the Borrower hereunder,
under any Note or any other Credit Document, will be made without setoff,
counterclaim or other defense. Except as provided for in section 5.4(c), all
such payments will be made free and clear of, and without deduction or
withholding for, any present or future United States withholding taxes. The
Borrower will furnish to the Administrative Agent within 45 days after the date
of any withholding or deduction on account of United States withholding taxes
certified copies of tax receipts, or other evidence satisfactory to the Lender,
evidencing such payment by the Borrower.
(b) Each Lender that is not a United States person (as such term
is defined in section 7701(a)(30) of the Code) for Federal income tax purposes
agrees to provide to the Borrower and the Administrative Agent on or prior to
the Effective Date, or in the cases of a Lender that is an assignee or
transferee of an interest under this Agreement pursuant to section 12.4 (unless
the respective Lender was already a Lender hereunder immediately prior to such
assignment or
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transfer and such Lender is in compliance with the provisions of this section
5.4(b)), on the date of such assignment or transfer to such Lender, (i) two
accurate and complete original signed copies of Internal Revenue Service Form
4224 or 1001 (or successor forms) certifying to such Lender's entitlement to a
complete exemption from United States withholding tax with respect to payments
to be made under this Agreement, any Note or any other Credit Document, or (ii)
if the Lender is not a "bank" within the meaning of section 881(c)(3)(A) of the
Code and cannot deliver either Internal Revenue Service Form 1001 or 4224
pursuant to clause (i) above, (x) a certificate substantially in the form of
Exhibit K (any such certificate, a "SECTION 5.4(B)(II) CERTIFICATE") and (y) two
accurate and complete original signed copies of Internal Revenue Service Form
W-8 (or successor form) certifying to such Lender's entitlement to a complete
exemption from United States withholding tax with respect to payments of
interest to be made under this Agreement, any Note or any other Credit Document.
In addition, each Lender agrees that from time to time after the Effective Date,
when a lapse in time or change in circumstances renders the previous
certification obsolete or inaccurate in any material respect, it will deliver to
the Borrower and the Administrative Agent two new accurate and complete original
signed copies of Internal Revenue Service Form 4224 or 1001, or Form W-8 and a
Section 5.4(b)(ii) Certificate, as the case may be, and such other forms as may
be required in order to confirm or establish the entitlement of such Lender to a
continued exemption from or reduction in United States withholding tax with
respect to payments under this Agreement, any Note or any other Credit Document,
or it shall immediately notify the Borrower and the Administrative Agent of its
inability to deliver any such Form or Certificate, in which case such Lender
shall not be required to deliver any such Form or Certificate pursuant to this
section 5.4(b).
(c) Notwithstanding anything to the contrary contained in section
5.4(a), the Borrower shall be entitled, to the extent it is required to do so by
law, to deduct or withhold income or other similar taxes imposed by the United
States (or any political subdivision or taxing authority thereof or therein)
from interest, fees or other amounts payable hereunder for the account of any
Lender which is not a United States person (as such term is defined in section
7701(a)(30) of the Code) for United States federal income tax purposes and which
has not provided to the Borrower such forms that establish a complete exemption
from such deduction or withholding (i) if such Lender has not provided to the
Borrower the Internal Revenue Service forms required to be provided to the
Borrower pursuant to section 5.4(b), or (ii) in the case of a payment other than
interest, to a Lender described in clause (ii) of section 5.2(b) above, to the
extent that such forms do not establish a complete exemption from withholding of
such taxes.
SECTION 6. CONDITIONS PRECEDENT.
6.1. CONDITIONS PRECEDENT AT CLOSING DATE. The obligation of the
Lenders to make Loans, and of any Letter of Credit Issuer to issue Letters of
Credit, is subject to the satisfaction of each of the following conditions on
the Closing Date:
(A) EFFECTIVENESS; NOTES. On or prior to the Closing
Date, (i) the Effective Date shall have occurred and (ii) there shall
have been delivered to the Administrative Agent for the account of each
Lender the appropriate Note or Notes executed by the Borrower, in each
case, in the amount, maturity and as otherwise provided herein.
(B) FEES, ETC. The Borrower shall have paid or caused to
be paid all fees required to be paid by it on or prior to such date
pursuant to section 4 hereof and all reasonable fees and expenses of
the Administrative Agent and of special counsel to the Administrative
Agent which have been invoiced on or prior to such date in connection
with the preparation, execution and delivery of this Agreement and the
other Credit Documents and the consummation of the transactions
contemplated hereby and thereby.
(C) OTHER CREDIT DOCUMENTS. The Credit Parties named
therein shall have duly executed and delivered and there shall be in
full force and effect, and original counterparts shall have been
delivered to the Administrative Agent, in sufficient quantities for the
Administrative Agent and the Lenders, of the Security Agreement, the
Copyright Assignment, the Patent Assignment, the Trademark Assignment,
the Pledge Agreement and the Subsidiary Guaranty.
(D) CORPORATE RESOLUTIONS AND APPROVALS. The
Administrative Agent shall have received, in sufficient quantity for
the Administrative Agent and the Lenders, certified copies of the
resolutions of the Board of Directors of each Credit Party, approving
the Credit Documents to which such Credit Party is or may become a
party, and of all documents evidencing other necessary corporate action
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and governmental approvals, if any, with respect to the execution,
delivery and performance by the Credit Party of the Credit Documents to
which it is or may become a party.
(E) INCUMBENCY CERTIFICATE. The Administrative Agent
shall have received, in sufficient quantity for the Administrative
Agent and the Lenders, a certificate of the Secretary or an Assistant
Secretary of each Credit Party, certifying the names and true
signatures of the officers of such Credit Party authorized to sign the
Credit Documents to which such Credit Party is a party and any other
documents to which such Credit Party is a party that may be executed
and delivered in connection herewith.
(F) OPINION OF COUNSEL. On the Closing Date, the
Administrative Agent shall have received an opinion, addressed to the
Administrative Agent and each of the Lenders and dated the Closing
Date, from ▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇, LLP, special counsel to the Credit
Parties, substantially in the form of Exhibit I hereto and covering
such other matters incident to the transactions contemplated hereby as
the Administrative Agent may reasonably request, such opinion to be in
form and substance satisfactory to the Administrative Agent.
(G) EXISTING CREDIT AGREEMENT. The loans outstanding
under the Existing Credit Agreement shall have been reallocated among
the lenders hereunder and thereunder in accordance with their
respective Commitments as provided in section 2.1(g).
(H) RECORDATION OF SECURITY DOCUMENTS, DELIVERY OF
COLLATERAL, TAXES, ETC. The Security Documents (or proper notices or
financing statements in respect thereof) shall have been duly recorded,
published and filed in such manner and in such places as is required by
law to establish, perfect, preserve and protect the rights and security
interests of the parties thereto and their respective successors and
assigns, all collateral items required to be physically delivered to
the Collateral Agent thereunder shall have been so delivered,
accompanied by any appropriate instruments of transfer, and all taxes,
fees and other charges then due and payable in connection with the
execution, delivery, recording, publishing and filing of such
instruments and the issue and delivery of the Notes shall have been
paid in full.
(I) EVIDENCE OF INSURANCE. The Collateral Agent shall
have received certificates of insurance and other evidence,
satisfactory to it, of compliance with the insurance requirements of
this Agreement and the Security Documents.
(J) SEARCH REPORTS. The Administrative Agent shall have
received completed requests for information on Form UCC-11, or search
reports from one or more commercial search firms acceptable to the
Administrative Agent, listing all of the effective financing statements
filed against any Credit Party which is a party to the Security
Agreement in any jurisdiction in which such Credit Party is organized,
maintains an office or in which any Collateral of such Credit Party is
located, together with copies of such financing statements.
(K) CLOSING CERTIFICATE. The Administrative Agent shall
have received, in sufficient quantity for the Administrative Agent and
the Lenders, a certificate signed by the Chief Financial Officer of the
Borrower, and certifying that: at and as of the Closing Date and after
giving effect to any Loans made (or deemed to have been made) on the
Closing Date, (i) there shall exist no Default or Event of Default and
(ii) all representations and warranties of the Borrower contained
herein or in the other Credit Document shall be true and correct in all
material respects with the same effect as though such representations
and warranties had been made on and as of the Closing Date, except to
the extent that such representations and warranties expressly relate to
an earlier specified date, in which case such representations and
warranties shall have been true and correct in all material respects as
of the date when made.
(L) CORPORATE CHARTER AND LONG FORM GOOD STANDING. The
Administrative Agent shall have received (i) a copy of the Certificate
of Incorporation or Certificate of Formation, as the case may be, of
each Credit Party and any and all amendments and restatements thereof,
certified as of a recent date by the Secretary of State of the State of
Delaware, and (ii) a certificate of the Secretary of State of the State
of Delaware, dated as of a recent date, listing all charter documents
affecting each Credit Party and certifying as to the good standing of
such Credit Party.
(M) PROCEEDINGS AND DOCUMENTS. All corporate and other
proceedings and all documents incidental to the transactions
contemplated hereby shall be satisfactory in substance and form to the
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Administrative Agent and the Lenders and the Administrative Agent and
its special counsel and the Lenders shall have received all such
counterpart originals or certified or other copies of such documents as
the Administrative Agent or its special counsel or any Lender may
reasonably request.
6.2. CONDITIONS PRECEDENT TO ALL CREDIT EVENTS. The obligations of
the Lenders to make each Loan and/or of a Letter of Credit Issuer to issue each
Letter of Credit is subject, at the time thereof, to the satisfaction of the
following conditions:
(A) NOTICE OF BORROWING, ETC. The Administrative Agent
shall have received a Notice of Borrowing meeting the requirements of
section 2.3 with respect to the incurrence of Loans or a Letter of
Credit Request meeting the requirement of section 3.2 with respect to
the issuance of a Letter of Credit.
(B) NO DEFAULT; REPRESENTATIONS AND WARRANTIES. At the
time of each Credit Event and also after giving effect thereto, (i)
there shall exist no Default or Event of Default and (ii) all
representations and warranties of the Credit Parties contained herein
or in the other Credit Documents shall be true and correct in all
material respects with the same effect as though such representations
and warranties had been made on and as of the date of such Credit
Event, except to the extent that such representations and warranties
expressly relate to an earlier specified date, in which case such
representations and warranties shall have been true and correct in all
material respects as of the date when made.
The acceptance of the benefits of each Credit Event shall constitute a
representation and warranty by the Borrower to each of the Lenders that all of
the applicable conditions specified in section 6.1 and/or 6.2, as the case may
be, exist as of that time. All of the certificates, legal opinions and other
documents and papers referred to in this section 6, unless otherwise specified,
shall be delivered to the Administrative Agent for the account of each of the
Lenders and, except for the Notes, in sufficient counterparts for each of the
Lenders, and the Administrative Agent will promptly distribute to the Lenders
their respective Notes and the copies of such other certificates, legal opinions
and documents.
SECTION 7. REPRESENTATIONS AND WARRANTIES.
In order to induce the Lenders to enter into this Agreement and to make
the Loans, and/or to issue and/or to participate in the Letters of Credit
provided for herein, the Borrower makes the following representations and
warranties to, and agreements with, the Lenders, all of which shall survive the
execution and delivery of this Agreement and each Credit Event:
7.1. CORPORATE STATUS, ETC. Each of the Borrower and its
Subsidiaries (i) is a duly organized or formed and validly existing corporation,
partnership or limited liability company, as the case may be, in good standing
under the laws of the jurisdiction of its formation and has the corporate,
partnership or limited liability company power and authority, as applicable, to
own its property and assets and to transact the business in which it is engaged
and presently proposes to engage, and (ii) has duly qualified and is authorized
to do business in all jurisdictions where it is required to be so qualified
except where the failure to be so qualified would not be reasonably likely to
have a Material Adverse Effect.
7.2. SUBSIDIARIES. Annex II hereto lists, as of the date hereof,
each Subsidiary of the Borrower (and the direct and indirect ownership interest
of the Borrower therein).
7.3. CORPORATE POWER AND AUTHORITY, ETC. Each Credit Party has the
corporate or other organizational power and authority to execute, deliver and
carry out the terms and provisions of the Credit Documents to which it is party
and has taken all necessary corporate or other organizational action to
authorize the execution, delivery and performance of the Credit Documents to
which it is party. Each Credit Party has duly executed and delivered each Credit
Document to which it is party and each Credit Document to which it is party
constitutes the legal, valid and binding agreement or obligation of such Credit
Party enforceable in accordance with its terms, except to the extent that the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws generally affecting creditors'
rights and by equitable principles (regardless of whether enforcement is sought
in equity or at law).
7.4. NO VIOLATION. Neither the execution, delivery and performance
by any Credit Party of the Credit Documents to which it is party nor compliance
with the terms and provisions thereof (i) will contravene any provision of
35
any law, statute, rule, regulation, order, writ, injunction or decree of any
court or governmental instrumentality applicable to such Credit Party or its
properties and assets, (ii) will conflict with or result in any breach of, any
of the terms, covenants, conditions or provisions of, or constitute a default
under, or result in the creation or imposition of (or the obligation to create
or impose) any Lien upon any of the property or assets of such Credit Party
(other than the Liens provided for in the Security Documents) pursuant to the
terms of any promissory note, bond, debenture, indenture, mortgage, deed of
trust, credit or loan agreement, or any other material agreement or other
instrument, to which such Credit Party is a party or by which it or any of its
property or assets are bound or to which it may be subject, or (iii) will
violate any provision of the certificate or articles of incorporation, by-laws,
or other charter documents of such Credit Party.
7.5. GOVERNMENTAL APPROVALS AND THIRD PARTY CONSENTS. No order,
consent, approval, license, authorization, or validation of, or filing,
recording or registration with, or exemption by, any foreign or domestic
governmental or public body or authority, or any subdivision thereof, or any
other person is required to authorize or is required as a condition to (i) the
execution, delivery and performance by any Credit Party of any Credit Document
to which it is a party, or (ii) the legality, validity, binding effect or
enforceability of any Credit Document to which any Credit Party is a party,
except the filing and recording of financing statements and other documents
necessary in order to perfect the Liens created by the Security Documents
7.6. LITIGATION. There are no actions, suits or proceedings pending
or, to, the knowledge of the Borrower, threatened with respect to the Borrower
or any of its Subsidiaries (i) that, with the possible exception of those
actions listed on Annex VII, have, or are reasonably likely to have, in the sole
judgment of management of the Borrower, a Material Adverse Effect, or (ii) which
question the validity or enforceability of any of the Credit Documents, or of
any action to be taken by any Credit Party pursuant to any of the Credit
Documents.
7.7. USE OF PROCEEDS; MARGIN REGULATIONS. (a) The proceeds of Loans
shall be utilized to finance Permitted Acquisitions and for general corporate
purposes (including working capital) not inconsistent with the requirements of
this Agreement.
(b) No part of the proceeds of any Credit Event will be used
directly or indirectly to purchase or carry Margin Stock, or to extend credit to
others for the purpose of purchasing or carrying any Margin Stock, in violation
of the provisions of Regulation T, U or X of the Board of Governors of the
Federal Reserve System. The Borrower is not engaged in the business of extending
credit for the purpose of purchasing or carrying any Margin Stock. At no time
would more than 25% of the value of the assets of the Borrower or of the
Borrower and its consolidated Subsidiaries that are subject to any "arrangement"
(as such term is used in section 221.2(g) of such Regulation U) hereunder be
represented by Margin Stock.
7.8. FINANCIAL STATEMENTS, ETC. (a) The Borrower has furnished to
the Lenders and the Administrative Agent complete and correct copies of (i) the
audited consolidated balance sheets of the Borrower and its consolidated
subsidiaries as of December 31, 2000, and December 31, 1999, and the related
audited consolidated statements of income, changes in shareholders' equity, and
cash flows for each of the fiscal years then ended, accompanied by the
unqualified report thereon of the Borrower's independent accountants; and (ii)
the unaudited condensed consolidated balance sheets of the Borrower and its
consolidated subsidiaries as of September 30, 2001, and the related unaudited
condensed consolidated statements of income and of cash flows of the Borrower
and its consolidated subsidiaries for the fiscal quarter or quarters then ended,
as contained in the Form 10-Q Quarterly Report of the Borrower filed with the
SEC. All such financial statements have been prepared in accordance with GAAP,
consistently applied (except as stated therein), and fairly present the
financial position of the Borrower and its consolidated subsidiaries as of the
respective dates indicated and the consolidated results of their operations and
cash flows for the respective periods indicated, subject in the case of any such
financial statements which are unaudited, to normal audit adjustments, none of
which are reasonably likely to have a Material Adverse Effect.
(b) The Borrower has received consideration which is the
reasonable equivalent value of the obligations and liabilities that the Borrower
has incurred to the Administrative Agent and the Lenders. As of the Closing
Date, the Borrower has capital sufficient to carry on its business and
transactions and all business and transactions in which it is about to engage
and is now solvent and able to pay its debts as they mature and the Borrower, as
of the Closing Date, owns property having a value, both at fair valuation and at
present fair salable value, greater than the amount required to pay the
Borrower's debts; and the Borrower is not entering into the Credit Documents
with the intent to hinder, delay or defraud its creditors. Without limitation of
the foregoing, on and as of the Closing Date, and after giving effect to all
36
Indebtedness incurred and to be incurred by the Borrower and its Subsidiaries in
connection herewith, (i) the sum of the assets, at a fair valuation, of the
Borrower will exceed its debts, (ii) the Borrower will not have incurred or
intended to, or believe that it will, incur debts beyond its ability to pay such
debts as such debts mature and (iii) the Borrower will have sufficient capital
with which to conduct its business. For purposes of this section 7.8(b), "DEBT"
means any liability on a claim, and "CLAIM" means (x) right to payment whether
or not such a right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured
or unsecured; or (y) right to an equitable remedy for breach of performance if
such breach gives rise to a payment, whether or not such right to an equitable
remedy is reduced to judgment, fixed, contingent, matured, unmatured, disputed,
undisputed, secured or unsecured.
(c) The Borrower has delivered or caused to be delivered to the
Lenders prior to the execution and delivery of this Agreement forecasted balance
sheets, income statements, changes in shareholders' equity and cash flow as of
or for the periods ended December 31, 2001, December 31, 2002 and December 31,
2003, prepared by management of the Borrower for the Borrower and its
Subsidiaries on a consolidated basis (the "FINANCIAL PROJECTIONS"). The
Financial Projections were prepared on behalf of the Borrower and its
Subsidiaries in good faith after taking into account the existing and historical
levels of business activity of the Borrower and its Subsidiaries, known trends,
including general economic trends, and all other information, assumptions and
estimates considered by management of the Borrower, as of such date of
preparation, to be realistically achievable; PROVIDED that no representation or
warranty is made as to the impact of future general economic conditions or as to
whether the Borrower's projected consolidated results as set forth in the
Financial Projections will actually be realized. No facts are known to the
Borrower at the date hereof that, if reflected in the Financial Projections,
would be reasonably likely to result in a material adverse change in the assets,
liabilities, results of operations or cash flows reflected therein.
7.9. NO MATERIAL ADVERSE CHANGE. Since December 31, 2000, there has
not been:
(a) any action, suit or other proceeding commenced or,
to, the knowledge of the Borrower, threatened with respect to the
Borrower or any of its Subsidiaries, that has, or is reasonably likely
to have, in the sole judgment of management of the Borrower, a Material
Adverse Effect;
(b) any law, regulation or rule enacted or promulgated by
any governmental body or agency, which is applicable to the conduct by
the Borrower or any of its Subsidiaries of its principal business
activities, that has had, or is reasonably likely to have, in the sole
judgment of management of the Borrower, a Material Adverse Effect; or
(c) any other event, or any other change in the
condition, business or affairs of the Borrower and its Subsidiaries
taken as a whole, or their properties and assets considered as an
entirety, except for changes, none of which, individually or in the
aggregate, has had or is reasonably likely to have, a Material Adverse
Effect.
7.10. TAX RETURNS AND PAYMENTS. Each of the Borrower and each of its
Subsidiaries has filed all federal income tax returns and all other material tax
returns, domestic and foreign, required to be filed by it and has paid all
material taxes and assessments payable by it which have become due, other than
those not yet delinquent and except for those contested in good faith. The
Borrower and each of its Subsidiaries has established on its books such charges,
accruals and reserves in respect of taxes, assessments, fees and other
governmental charges for all fiscal periods as are required by GAAP. The
Borrower knows of no proposed assessment for additional federal, foreign or
state taxes for any period, or of any basis therefor, which, individually or in
the aggregate, taking into account such charges, accruals and reserves in
respect thereof as the Borrower and its Subsidiaries have made, is reasonably
likely to have a Material Adverse Effect.
7.11. TITLE TO PROPERTIES, ETC. The Borrower and each of its
Subsidiaries has good and marketable title, in the case of real property, and
good title (or valid leasehold interests, in the case of any leased property),
in the case of all other property, to all of its properties and assets free and
clear of Liens other than Liens permitted by section 9.3. The interests of the
Borrower and each of its Subsidiaries in the properties reflected in the most
recent balance sheet referred to in section 7.8, taken as a whole, were
sufficient, in the judgment of the Borrower, as of the date of such balance
sheet for purposes of the ownership and operation of the businesses conducted by
the Borrower and such Subsidiaries.
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7.12. LAWFUL OPERATIONS, ETC. The Borrower and each of its
Subsidiaries (i) holds all necessary federal, state and local governmental
licenses, registrations, certifications, permits and authorizations necessary to
conduct its business, and (ii) is in full compliance with all material
requirements imposed by law, regulation or rule, whether federal, state or
local, which are applicable to it, its operations, or its properties and assets,
including without limitation, applicable requirements of Environmental Laws,
except for any failure to obtain and maintain in effect, or noncompliance,
which, individually or in the aggregate, is not reasonably likely to have a
Material Adverse Effect.
7.13. ENVIRONMENTAL MATTERS. (a) The Borrower and each of its
Subsidiaries is in compliance with all Environmental Laws governing its business
except to the extent that any such failure to comply (together with any
resulting penalties, fines or forfeitures) is not reasonably likely to have a
Material Adverse Effect. All licenses, permits, registrations or approvals
required for the business of the Borrower and each of its Subsidiaries, as
conducted as of the Closing Date, under any Environmental Law have been secured
and the Borrower and each of its Subsidiaries is in substantial compliance
therewith, except for such licenses, permits, registrations or approvals the
failure to secure or to comply therewith is not reasonably likely to have a
Material Adverse Effect. Neither the Borrower nor any of its Subsidiaries has
received written notice, or otherwise knows, that it is in any respect in
noncompliance with, breach of or default under any applicable writ, order,
judgment, injunction, or decree to which the Borrower or such Subsidiary is a
party or which would affect the ability of the Borrower or such Subsidiary to
operate any real property and no event has occurred and is continuing which,
with the passage of time or the giving of notice or both, would constitute
noncompliance, breach of or default thereunder, except in each such case, such
noncompliance, breaches or defaults as would not reasonably be likely to, in the
aggregate, have a Material Adverse Effect. There are as of the Closing Date no
Environmental Claims pending or, to the best knowledge of the Borrower,
threatened wherein an unfavorable decision, ruling or finding would reasonably
be likely to have a Material Adverse Effect. There are no facts, circumstances,
conditions or occurrences on any Real Property now or at any time owned, leased
or operated by the Borrower or any of its Subsidiaries or on any property
adjacent to any such Real Property, which are known by the Borrower or as to
which the Borrower or any such Subsidiary has received written notice, that
could reasonably be expected (i) to form the basis of an Environmental Claim
against the Borrower or any of its Subsidiaries or any Real Property of the
Borrower or any of its Subsidiaries, or (ii) to cause such Real Property to be
subject to any restrictions on the ownership, occupancy, use or transferability
of such Real Property under any Environmental Law, except in each such case,
such Environmental Claims or restrictions that individually or in the aggregate
would not reasonably be likely to have a Material Adverse Effect.
(b) Hazardous Materials have not at any time been (i) generated,
used, treated or stored on, or transported to or from, any Real Property of the
Borrower or any of its Subsidiaries or (ii) released on any such Real Property,
in each case where such occurrence or event is not in compliance with
Environmental Laws and is reasonably likely to have a Material Adverse Effect.
7.14. COMPLIANCE WITH ERISA. Compliance by the Borrower with the
provisions hereof and Credit Events contemplated hereby will not involve any
prohibited transaction within the meaning of ERISA or section 4975 of the Code.
The Borrower and each of its Subsidiaries, (i) has fulfilled all obligations
under minimum funding standards of ERISA and the Code with respect to each Plan
that is not a Multiemployer Plan or a Multiple Employer Plan, (ii) has satisfied
all respective contribution obligations in respect of each Multiemployer Plan
and each Multiple Employer Plan, (iii) is in compliance in all material respects
with all other applicable provisions of ERISA and the Code with respect to each
Plan, each Multiemployer Plan and each Multiple Employer Plan, and (iv) has not
incurred any liability under the Title IV of ERISA to the PBGC with respect to
any Plan, any Multiemployer Plan, any Multiple Employer Plan, or any trust
established thereunder. No Plan or trust created thereunder has been terminated,
and there have been no Reportable Events, with respect to any Plan or trust
created thereunder or with respect to any Multiemployer Plan or Multiple
Employer Plan, which termination or Reportable Event will or could result in the
termination of such Plan, Multiemployer Plan or Multi Employer Plan and give
rise to a material liability of the Borrower or any ERISA Affiliate in respect
thereof. Neither the Borrower nor any ERISA Affiliate is at the date hereof, or
has been at any time within the two years preceding the date hereof, an employer
required to contribute to any Multiemployer Plan or Multi Employer Plan, or a
"contributing sponsor" (as such term is defined in section 4001 of ERISA) in any
Multiemployer Plan or Multiple Employer Plan. Neither the Borrower nor any ERISA
Affiliate has any contingent liability with respect to any post-retirement
"welfare benefit plan" (as such term is defined in ERISA) except as has been
disclosed to the Lenders in writing.
7.15. INTELLECTUAL PROPERTY, ETC. The Borrower and each of its
Subsidiaries has obtained or has the right to use all material patents,
trademarks, servicemarks, trade names, copyrights, licenses and other rights
with respect to the foregoing necessary for the present and planned future
conduct of its business, without any known conflict with the rights
38
of others, EXCEPT for such patents, trademarks, servicemarks, trade names,
copyrights, licenses and rights, the loss of which, and such conflicts, which in
any such case individually or in the aggregate would not be reasonably likely to
have a Material Adverse Effect.
7.16. INVESTMENT COMPANY ACT, ETC. Neither the Borrower nor any of
its Subsidiaries is subject to regulation with respect to the creation or
incurrence of Indebtedness under the Investment Company Act of 1940, as amended,
the Interstate Commerce Act, as amended, the Federal Power Act, as amended, the
Public Utility Holding Company Act of 1935, as amended, or any applicable state
public utility law.
7.17. BURDENSOME CONTRACTS; LABOR RELATIONS. Neither the Borrower
nor any of its Subsidiaries (i) is subject to any unduly burdensome contract,
agreement, corporate restriction, judgment, decree or order, (ii) is a party to
any labor dispute affecting any bargaining unit or other group of employees
generally, (iii) is subject to any material strike, slow down, workout or other
concerted interruptions of operations by employees of the Borrower or any
Subsidiary, whether or not relating to any labor contracts, (iv) is subject to
any significant pending or, to the knowledge of the Borrower, threatened, unfair
labor practice complaint, before the National Labor Relations Board, and (v) is
subject to any significant pending or, to the knowledge of the Borrower,
threatened, grievance or significant arbitration proceeding arising out of or
under any collective bargaining agreement, (vi) is subject to any significant
pending or, to the knowledge of the Borrower, threatened, significant strike,
labor dispute, slowdown or stoppage, or (vii) is, to the knowledge of the
Borrower, involved or subject to any union representation organizing or
certification matter with respect to the employees of the Borrower or any of its
Subsidiaries, EXCEPT (with respect to any matter specified in any of the above
clauses), for such matters as, individually or in the aggregate, would not
reasonably be likely to have a Material Adverse Effect.
7.18. EXISTING INDEBTEDNESS. Annex III sets forth a true and
complete list, as of the date or dates set forth therein, of all Indebtedness of
the Borrower and each of its Subsidiaries, on a consolidated basis, which (i)
has an outstanding principal amount of at least $10,000, or may be incurred
pursuant to existing commitments or lines of credit, or (ii) is secured by any
Lien on any property of the Borrower or any Subsidiary, and which will be
outstanding on the Closing Date after giving effect to the initial Borrowing
hereunder, other than the Indebtedness created under the Credit Documents (all
such Indebtedness, whether or not in a principal amount meeting such threshold
and required to be so listed on Annex III, herein the "EXISTING INDEBTEDNESS").
The Borrower has provided to the Administrative Agent prior to the date of
execution hereof true and complete copies (or summary descriptions) of all
agreements and instruments governing the Indebtedness listed on Annex III (the
"EXISTING INDEBTEDNESS AGREEMENTS").
7.19. [RESERVED.]
7.20. SECURITY INTERESTS. Once executed and delivered, and until
terminated in accordance with the terms thereof, each of the Security Documents
creates, as security for the obligations purported to be secured thereby, a
valid and enforceable perfected security interest in and Lien on all of the
Collateral subject thereto from time to time, in favor of the Collateral Agent
for the benefit of the Secured Creditors referred to in the Security Documents,
superior to and prior to the rights of all third persons and subject to no other
Liens (except that the Collateral under the Security Agreement may be subject to
Permitted Liens). No filings or recordings are required in order to perfect the
security interests created under any Security Document except for filings or
recordings required in connection with any such Security Document which shall
have been made, or for which satisfactory arrangements have been made, upon or
prior to the execution and delivery thereof. All recording, stamp, intangible or
other similar taxes required to be paid by any person under applicable legal
requirements or other laws applicable to the property encumbered by the Security
Documents in connection with the execution, delivery, recordation, filing,
registration, perfection or enforcement thereof have been paid.
7.21. TRUE AND COMPLETE DISCLOSURE. All factual information (taken
as a whole) heretofore or contemporaneously furnished by or on behalf of the
Borrower or any of its Subsidiaries in writing to the Administrative Agent or
any Lender for purposes of or in connection with this Agreement or any
transaction contemplated herein, other than the Financial Projections (as to
which representations are made only as provided in section 7.8), is, and all
other such factual information (taken as a whole) hereafter furnished by or on
behalf of such person in writing to any Lender will be, true and accurate in all
material respects on the date as of which such information is dated or certified
and not incomplete by omitting to state any material fact necessary to make such
information (taken as a whole) not misleading at such time in light of the
circumstances under which such information was provided, except that any such
future information consisting of financial projections prepared by management of
the Borrower is only represented herein as being based on good faith estimates
and assumptions believed by such persons to be reasonable at the time made, it
being recognized by the Lenders
39
that such projections as to future events are not to be viewed as facts and that
actual results during the period or periods covered by any such projections may
differ materially from the projected results. As of the Effective Date, there is
no fact known to the Borrower or any of its Subsidiaries which has, or would
reasonably be likely to have, a Material Adverse Effect which has not
theretofore been disclosed in writing to the Lenders.
SECTION 8. AFFIRMATIVE COVENANTS.
The Borrower hereby covenants and agrees that so long as this Agreement
is in effect and until such time as the Total Commitment has been terminated, no
Notes are outstanding and the Loans, together with interest, Fees and all other
Obligations hereunder, have been paid in full:
8.1. REPORTING REQUIREMENTS. The Borrower will furnish to each
Lender and the Administrative Agent:
(A) ANNUAL FINANCIAL STATEMENTS. As soon as available and
in any event within 95 days after the close of each fiscal year of the
Borrower, a Form 10-K of the Borrower and the consolidated balance
sheets of the Borrower and its consolidated Subsidiaries as at the end
of such fiscal year and the related consolidated statements of income,
of stockholder's equity and of cash flows for such fiscal year, in each
case setting forth comparative figures for the preceding fiscal year,
all in reasonable detail and accompanied by (i) the opinion with
respect to such consolidated financial statements of
PricewaterhouseCoopers or another "Big Five" (or similarly designated)
independent certified public accountant selected by the Borrower, which
opinion shall be unqualified and shall (A) state that such accountants
audited such consolidated financial statements in accordance with
generally accepted auditing standards, that such accountants believe
that such audit provides a reasonable basis for their opinion, and that
in their opinion such consolidated financial statements present fairly,
in all material respects, the consolidated financial position of the
Borrower and its consolidated subsidiaries as at the end of such fiscal
year and the consolidated results of their operations and cash flows
for such fiscal year in conformity with generally accepted accounting
principles, or (B) contain such statements as are customarily included
in unqualified reports of independent accountants in conformity with
the recommendations and requirements of the American Institute of
Certified Public Accountants (or any successor organization, (ii)
copies of any management letters of the public accountants addressed to
the Borrower), and (iii) the unaudited consolidating balance sheet of
the Borrower and its consolidated Subsidiaries as at the end of such
fiscal year and the related consolidating statements of income, of
stockholders' equity and of cash flows for such fiscal year, in each
case setting forth comparative figures for the preceding fiscal year,
all in reasonable detail.
(B) QUARTERLY FINANCIAL STATEMENTS. As soon as available
and in any event within 50 days after the close of each of the first
three quarterly accounting periods in each fiscal year of the Borrower,
a Form 10-Q of the Borrower and the unaudited condensed consolidated
and consolidating balance sheets of the Borrower and its consolidated
Subsidiaries as at the end of such quarterly period and the related
unaudited condensed consolidated and consolidating statements of income
and of cash flows for such quarterly period, and setting forth, in the
case of such unaudited consolidated statements of income and of cash
flows, comparative figures for the related periods in the prior fiscal
year, and which consolidated financial statements shall be certified on
behalf of the Borrower by the Chief Financial Officer or other
Authorized Officer of the Borrower, subject to changes resulting from
normal year-end audit adjustments.
(C) OFFICER'S COMPLIANCE CERTIFICATES. At the time of the
delivery of the financial statements provided for in sections 8.1(a)
and (b), a certificate, substantially in the form attached hereto as
Exhibit L, on behalf of the Borrower, of the Chief Financial Officer or
other Authorized Officer of the Borrower to the effect that, to the
best knowledge of the Borrower, no Default or Event of Default exists
or, if any Default or Event of Default does exist, specifying the
nature and extent thereof, which certificate shall set forth the
calculations required to establish compliance with the provisions of
sections 9.4(b) and (c), 9.7, 9.8, 9.9, 9.10 and 9.11 of this Agreement
and identify in reasonable detail any financial adjustments included in
such calculations to take into account the acquisition or disposition
of any business which is required or permitted to be taken into account
hereunder in connection with such calculations.
(D) MONTHLY FINANCIAL REPORTS AND GROSS RECOVERIES IN
PROCESS. As soon as available and in any event within 35 days after the
end of each calendar month (other than any calendar month that is also
the end of a fiscal quarter or fiscal year), a copy of the monthly
financial statements the Borrower customarily prepares
40
for its senior financial or accounting officers, in form reasonably
acceptable to the Administrative Agent, together with a certificate or
statement on behalf of the Borrower of the Chief Financial Officer or
other Authorized Officer of the Borrower providing a computation in
reasonable detail of the Borrower's Gross Recoveries in Process as of
the end of such month, each in such form as is reasonably acceptable to
the Administrative Agent.
(E) QUARTERLY CONTRACT LISTING. As soon as available and
in any event within 45 days after the close of each of the quarterly
accounting periods in each fiscal year of the Borrower, a listing, in a
format that is acceptable to the Administrative Agent (which may be the
format customarily used by the Borrower for its senior financial or
accounting officers), of new contracts (or additions to existing
contracts) between the Borrower or any of its Subsidiaries and clients
for whom the Borrower or any Subsidiary has been engaged to provide
recovery services with respect to potentially recoverable claims.
(F) BUDGETS AND FORECASTS. Not later than 30 days
following the approval of a consolidated budget for any fiscal year by
the Board of Directors of the Borrower, a consolidated budget in
reasonable detail for each of the four fiscal quarters of such fiscal
year, and (if and to the extent prepared by management of the Borrower)
for any subsequent fiscal years, as customarily prepared by management
for its internal use, setting forth, with appropriate discussion, the
forecasted balance sheet, income statement, operating cash flows and
capital expenditures of the Borrower and its Subsidiaries for the
period covered thereby, and the principal assumptions upon which
forecasts and budget are based.
(G) NOTICE OF DEFAULT, LITIGATION, LEGISLATION OR CERTAIN
MATTERS INVOLVING MAJOR CUSTOMERS OR SUPPLIERS. Promptly, and in any
event within three Business Days, in the case of clause (i) below, or
five Business Days, in the case of clause (ii) or (iii) below, after
the Borrower or any of its Subsidiaries obtains knowledge thereof,
notice of
(i) the occurrence of any event which
constitutes a Default or Event of Default, which notice shall
specify the nature thereof, the period of existence thereof
and what action the Borrower proposes to take with respect
thereto,
(ii) any litigation or governmental or regulatory
proceeding pending against the Borrower or any of its
Subsidiaries, or the adoption of any legislation, regulations
or rules by any governmental body or agency thereof, in each
case which is likely to have a Material Adverse Effect or a
material adverse effect on the ability of the Borrower to
perform its obligations hereunder or under any other Credit
Document, and
(iii) any significant adverse change (in the
Borrower's reasonable judgment) in the Borrower's or any
Subsidiary's relationship with, or any significant event or
circumstance which is in the Borrower's reasonable judgment
likely to adversely affect the Borrower's or any Subsidiary's
relationship with, (A) any client or other customer (or
related group of clients or other customers) representing more
than 5% of the Borrower's consolidated revenues during its
most recent fiscal year, or (B) any supplier which is
significant to the Borrower and its Subsidiaries considered as
an entirety.
(H) ERISA. Promptly, and in any event within 10 days
after the Borrower, any Subsidiary of the Borrower or any ERISA
Affiliate knows of the occurrence of any of the following, the Borrower
will deliver to each of the Lenders a certificate on behalf of the
Borrower of an Authorized Officer of the Borrower setting forth the
full details as to such occurrence and the action, if any, that the
Borrower, such Subsidiary or such ERISA Affiliate is required or
proposes to take, together with any notices required or proposed to be
given to or filed with or by the Borrower, the Subsidiary, the ERISA
Affiliate, the PBGC, a Plan participant or the Plan administrator with
respect thereto:
(i) that a Reportable Event has occurred with
respect to any Plan;
(ii) the institution of any steps by the
Borrower, any ERISA Affiliate, the PBGC or any other person to
terminate any Plan;
(iii) the institution of any steps by the Borrower
or any ERISA Affiliate to withdraw from any Plan;
41
(iv) the institution of any steps by the Borrower
or any Subsidiary to withdraw from any Multiemployer Plan or
Multiple Employer Plan, if such withdrawal could result in
withdrawal liability (as described in Part 1 of Subtitle E of
Title IV of ERISA) in excess of $1,000,000;
(v) a non-exempt "prohibited transaction" within
the meaning of section 406 of ERISA in connection with any
Plan;
(vi) that a Plan has an Unfunded Current
Liability exceeding $1,000,000;
(vii) any material increase in the contingent
liability of the Borrower or any Subsidiary with respect to
any post-retirement welfare liability; or
(viii) the taking of any action by, or the
threatening of the taking of any action by, the Internal
Revenue Service, the Department of Labor or the PBGC with
respect to any of the foregoing.
(I) ENVIRONMENTAL MATTERS. Promptly upon, and in any
event within 10 Business Days after, an officer of the Borrower obtains
actual knowledge thereof, notice of any of the following environmental
matters which is reasonably likely (in the Borrower's reasonable
judgment) to result in a Material Adverse Effect: (i) any pending or
threatened (in writing) Environmental Claim against the Borrower or any
of its Subsidiaries or any Real Property owned or operated by the
Borrower or any of its Subsidiaries; (ii) any condition or occurrence
on or arising from any Real Property owned or operated by the Borrower
or any of its Subsidiaries that (A) results in noncompliance by the
Borrower or any of its Subsidiaries with any applicable Environmental
Law or (B) would reasonably be expected to form the basis of an
Environmental Claim against the Borrower or any of its Subsidiaries or
any such Real Property; (iii) any condition or occurrence on any Real
Property owned, leased or operated by the Borrower or any of its
Subsidiaries that could reasonably be expected to cause such Real
Property to be subject to any restrictions on the ownership, occupancy,
use or transferability by the Borrower or any of its Subsidiaries of
such Real Property under any Environmental Law; and (iv) the taking of
any removal or remedial action in response to the actual or alleged
presence of any Hazardous Material on any Real Property owned, leased
or operated by the Borrower or any of its Subsidiaries as required by
any Environmental Law or any governmental or other administrative
agency. All such notices shall describe in reasonable detail the nature
of the Environmental Claim and the Borrower's or such Subsidiary's
response thereto.
(J) AUDITORS' INTERNAL CONTROL COMMENT LETTERS, ETC.
Promptly upon receipt thereof, a copy of each letter or memorandum
commenting on internal accounting controls and/or accounting or
financial reporting policies followed by the Borrower and/or any of its
Subsidiaries, which is submitted to the Borrower by its independent
accountants in connection with any annual or interim audit made by them
of the books of the Borrower or any of its Subsidiaries.
(K) SEC REPORTS AND REGISTRATION STATEMENTS. Promptly
upon transmission thereof or other filing with the SEC, copies of all
registration statements (other than the exhibits thereto and any
registration statement on Form S-8 or its equivalent) and annual,
quarterly or current reports that the Borrower or any of its
Subsidiaries files with the SEC.
(L) OTHER INFORMATION. With reasonable promptness, such
other information or documents (financial or otherwise) relating to the
Borrower or any of its Subsidiaries as any Lender may reasonably
request from time to time.
8.2. BOOKS, RECORDS AND INSPECTIONS. The Borrower will, and will
cause each of its Subsidiaries to, (i) keep proper books of record and account,
in which full and correct entries shall be made of all financial transactions
and the assets and business of the Borrower or such Subsidiaries, as the case
may be, in accordance with GAAP; and (ii) permit, upon at least five Business
Days' notice to the Chief Financial Officer or any other Authorized Officer of
the Borrower, officers and designated representatives of the Administrative
Agent to visit and inspect any of the properties or assets of the Borrower and
any of its Subsidiaries in whomsoever's possession (but only to the extent the
Borrower or such Subsidiary has the right to do so to the extent in the
possession of another person), to examine the books of account of the Borrower
and any of its Subsidiaries, and to make copies thereof and take extracts
therefrom, and to discuss the affairs, finances and accounts of the Borrower and
of any of its Subsidiaries with, and be advised as to the same by, its
42
and their officers and independent accountants and independent actuaries, if
any, all at such reasonable times and intervals and to such reasonable extent as
the Administrative Agent may request.
8.3. INSURANCE. (a) The Borrower will, and will cause each of its
Subsidiaries to, (i) maintain insurance coverage by such insurers and in such
forms and amounts and against such risks as are generally consistent with the
insurance coverage maintained by the Borrower and its Subsidiaries at the date
hereof, and (ii) forthwith upon the Administrative Agent's written request,
furnish to the Administrative Agent such information about such insurance as the
Administrative Agent may from time to time reasonably request, which information
shall be prepared in form and detail satisfactory to the Administrative Agent
and certified by an Authorized Officer of the Borrower.
(b) The Borrower will, and will cause each of its Subsidiaries
which is a Credit Party to, at all times keep their respective property which is
subject to the Lien of any Security Document insured in favor of the Collateral
Agent, and all policies or certificates (or certified copies thereof) with
respect to such insurance (and any other insurance maintained by the Borrower or
any such Subsidiary) (i) shall be endorsed to the Collateral Agent's
satisfaction for the benefit of the Collateral Agent (including, without
limitation, by naming the Collateral Agent as loss payee (with respect to
Collateral) or, to the extent permitted by applicable law, as an additional
insured), (ii) shall state that such insurance policies shall not be canceled
without 30 days' prior written notice thereof (or 10 days' prior written notice
in the case of cancellation for the non-payment of premiums) by the respective
insurer to the Collateral Agent, (iii) shall provide that the respective
insurers irrevocably waive any and all rights of subrogation with respect to the
Collateral Agent and the Lenders, and (iv) shall in the case of any such
certificates or endorsements in favor of the Collateral Agent, be delivered to
or deposited with the Collateral Agent. In no event shall the Borrower be
required to deposit the actual insurance policies with the Collateral Agent. The
Administrative Agent shall deliver copies of any certificates of insurance to a
Lender upon such Lender's request.
(c) If the Borrower or any of its Subsidiaries shall fail to
maintain all insurance in accordance with this section 8.3, or if the Borrower
or any of its Subsidiaries shall fail to so endorse and deliver or deposit all
endorsements or certificates with respect thereto, the Administrative Agent
and/or the Collateral Agent shall have the right (but shall be under no
obligation), upon prior notice to the Borrower, to procure such insurance and
the Borrower agrees to reimburse the Administrative Agent or the Collateral
Agent, as the case may be, on demand, for all costs and expenses of procuring
such insurance.
8.4. PAYMENT OF TAXES AND CLAIMS. The Borrower will pay and
discharge, and will cause each of its Subsidiaries to pay and discharge, all
taxes, assessments and governmental charges or levies imposed upon it or upon
its income or profits, or upon any properties belonging to it, prior to the date
on which penalties attach thereto, and all lawful claims which, if unpaid, might
become a Lien or charge upon any properties of the Borrower or any of its
Subsidiaries; PROVIDED that neither the Borrower nor any of its Subsidiaries
shall be required to pay any such tax, assessment, charge, levy or claim which
is being contested in good faith and by proper proceedings if it has maintained
adequate reserves with respect thereto in accordance with GAAP. Without limiting
the generality of the foregoing, the Borrower will, and will cause each of its
Subsidiaries to, pay in full all of its wage obligations to its employees in
accordance with the Fair Labor Standards Act (29 U.S.C. sections 206-207) and
any comparable provisions of applicable law.
8.5. CORPORATE FRANCHISES. The Borrower will do, and will cause
each of its Subsidiaries to do, or cause to be done, all things necessary to
preserve and keep in full force and effect its corporate or other organizational
existence, rights, authority and franchises, PROVIDED that nothing in this
section 8.5 shall be deemed to prohibit (i) any transaction permitted by section
9.2; (ii) the termination of existence of any Subsidiary if (A) the Borrower
determines that such termination is in its best interest and (B) such
termination is not adverse in any material respect to the Lenders; or (iii) the
loss of any rights, authorities or franchises if the loss thereof, in the
aggregate, would not reasonably be likely to have a Material Adverse Effect.
8.6. GOOD REPAIR. The Borrower will, and will cause each of its
Subsidiaries to, ensure that its material properties and equipment used or
useful in its business in whomsoever's possession they may be, are kept in good
repair, working order and condition, normal wear and tear excepted, and that
from time to time there are made in such properties and equipment all needful
and proper repairs, renewals, replacements, extensions, additions, betterments
and improvements, thereto, to the extent and in the manner customary for
companies in similar businesses.
8.7. COMPLIANCE WITH STATUTES, ETC. The Borrower will, and will
cause each of its Subsidiaries to, comply, in all material respects, with all
applicable statutes, regulations and orders of, and all applicable restrictions
imposed by,
43
all governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property, other than those (i) being contested
in good faith by appropriate proceedings, as to which adequate reserves are
established to the extent required under GAAP, and (ii) the noncompliance with
which would not have, and which would not be reasonably likely to have, a
Material Adverse Effect or a material adverse effect on the ability of the
Borrower to perform its obligations under any Credit Document.
8.8. COMPLIANCE WITH ENVIRONMENTAL LAWS. Without limitation of the
covenants contained in section 8.7 hereof:
(a) The Borrower will, and will cause each of its
Subsidiaries to, (i) comply, in all material respects, with all
Environmental Laws applicable to the ownership, lease or use of all
Real Property now or hereafter owned, leased or operated by the
Borrower or any of its Subsidiaries, and promptly pay or cause to be
paid all costs and expenses incurred in connection with such
compliance, except for such noncompliance as would not have, and which
would not be reasonably likely to have, a Material Adverse Effect or a
material adverse effect on the ability of the Borrower to perform its
obligations under any Credit Document; and (ii) keep or cause to be
kept all such Real Property free and clear of any Liens imposed
pursuant to such Environmental Laws which are not permitted under
section 9.3.
(b) Without limitation of the foregoing, if the Borrower
or any of its Subsidiaries shall generate, use, treat, store, release
or dispose of, or permit the generation, use, treatment, storage,
release or disposal of, Hazardous Materials on any Real Property now or
hereafter owned, leased or operated by the Borrower or any of its
Subsidiaries, or transport or permit the transportation of Hazardous
Materials to or from any such Real Property, any such action shall be
effected only in the ordinary course of business and in any event in
compliance, in all material respects, with all Environmental Laws
applicable thereto, except for such noncompliance as would not have,
and which would not be reasonably likely to have, a Material Adverse
Effect or a material adverse effect on the ability of the Borrower to
perform its obligations under any Credit Document.
(c) If required to do so under any applicable order of
any governmental agency, the Borrower will undertake, and cause each of
its Subsidiaries to undertake, any clean up, removal, remedial or other
action necessary to remove and clean up any Hazardous Materials from
any Real Property owned, leased or operated by the Borrower or any of
its Subsidiaries in accordance with, in all material respects, the
requirements of all applicable Environmental Laws and in accordance
with, in all material respects, such orders of all governmental
authorities, except (i) to the extent that the Borrower or such
Subsidiary is contesting such order in good faith and by appropriate
proceedings and for which adequate reserves have been established to
the extent required by GAAP, or (ii) for such noncompliance as would
not have, and which would not be reasonably likely to have, a Material
Adverse Effect or a material adverse effect on the ability of the
Borrower to perform its obligations under any Credit Document.
(d) At the written request of the Administrative Agent or
the Required Lenders, which request shall specify in reasonable detail
the basis therefor, at any time and from time to time after the Lenders
receive notice under section 8.1(i) for any Environmental Claim
involving potential expenditures by the Borrower or any of its
Subsidiaries in excess of $1,000,000 in the aggregate for any Real
Property, the Borrower will provide, at its sole cost and expense, an
environmental site assessment report concerning any such Real Property
now or hereafter owned, leased or operated by the Borrower or any of
its Subsidiaries, prepared by an environmental consulting firm
reasonably acceptable to the Administrative Agent, indicating the
presence or absence of Hazardous Materials and the potential cost of
any removal or a remedial action in connection with any Hazardous
Materials on such Real Property. If the Borrower fails to provide the
same within 90 days after such request was made, the Administrative
Agent may order the same, and the Borrower shall grant and hereby
grants, to the Administrative Agent and the Lenders and their agents,
access to such Real Property and specifically grants the Administrative
Agent and the Lenders an irrevocable non-exclusive license, subject to
the rights of tenants, to undertake such an assessment, all at the
Borrower's expense.
8.9. FISCAL YEARS, FISCAL QUARTERS. The Borrower will, for
consolidated financial reporting purposes, continue to use December 31 as the
end of its fiscal year and March 31, June 30, September 30 and December 31 as
the end of its fiscal quarters. If the Borrower shall change any of its
Subsidiaries' fiscal years or fiscal quarters (other than the fiscal year or
fiscal quarters of a person which becomes a Subsidiary, made at the time such
person becomes a Subsidiary, to conform to the Borrower's fiscal year and fiscal
quarters or to conform to the fiscal year or fiscal quarters which the
44
Borrower generally utilizes for its Subsidiaries), the Borrower will promptly,
and in any event within 30 days following any such change, deliver a notice to
the Administrative Agent and the Lenders describing such change and any material
accounting entries made in connection therewith and stating whether such change
will have any impact upon any financial computations to be made hereunder, and
if any such impact is foreseen, describing in reasonable detail the nature and
extent of such impact. If the Required Lenders determine that any such change
will have any impact upon any financial computations to be made hereunder which
is adverse to the Lenders, the Borrower will, if so requested by the
Administrative Agent, enter into an amendment to this Agreement, in form and
substance satisfactory to the Administrative Agent and the Required Lenders,
modifying any of the financial covenants or related provisions hereof in such
manner as the Required Lenders determine is necessary to eliminate such adverse
effect.
8.10. CERTAIN SUBSIDIARIES TO JOIN IN SUBSIDIARY GUARANTY. (a) In
the event that at any time after the Closing Date
(x) the Borrower has any Subsidiary (other than a Foreign
Subsidiary as to which section 8.10(b) applies) which is not a party to
the Subsidiary Guaranty, or
(y) an Event of Default shall have occurred and be
continuing and the Borrower has any Subsidiary which is not a party to
the Subsidiary Guaranty,
the Borrower will notify the Administrative Agent in writing of such event,
identifying the Subsidiary in question and referring specifically to the rights
of the Administrative Agent and the Lenders under this section. The Borrower
will, within 30 days following request therefor from the Administrative Agent
(who may give such request on its own initiative or upon request by the Required
Lenders), cause such Subsidiary to deliver to the Administrative Agent, in
sufficient quantities for the Lenders, (i) the Subsidiary Guaranty, if the
Subsidiary Guaranty has not previously been executed and delivered by any
Subsidiary of the Borrower, (ii) if the Subsidiary Guaranty has already been
executed and delivered by any other Subsidiary of the Borrower, a joinder
supplement, satisfactory in form and substance to the Administrative Agent and
the Required Lenders, duly executed by such Subsidiary, pursuant to which such
Subsidiary joins in the Subsidiary Guaranty as a guarantor thereunder, and (iii)
if such Subsidiary is a corporation, resolutions of the Board of Directors of
such Subsidiary, certified by the Secretary or an Assistant Secretary of such
Subsidiary as duly adopted and in full force and effect, authorizing the
execution and delivery of the Subsidiary Guaranty or such joinder supplement, as
the case may be, or if such Subsidiary is not a corporation, such other evidence
of the authority of such Subsidiary to execute the Subsidiary Guaranty or such
joinder supplement, as the case may be, as the Administrative Agent may
reasonably request.
(b) Notwithstanding the foregoing or the provisions of section
8.11 hereof:
(i) the Borrower shall not, unless an Event of Default
shall have occurred and be continuing, be required to cause a Foreign
Subsidiary to join in the Subsidiary Guaranty or to become a party to
an Additional Security Document if (A) to do so would subject the
Borrower to liability for additional United States income taxes by
virtue of section 956 of the Code in an amount the Borrower considers
material, and (B) the Borrower provides the Administrative Agent with
documentation, including computations prepared by the Borrower's
internal tax officer, its independent accountants or tax counsel,
acceptable to the Required Lenders, in support thereof; and
(ii) in no event shall the Borrower be required to cause a
Foreign Subsidiary which is not a Material Subsidiary to join in the
Subsidiary Guaranty or to execute and deliver any Additional Security
Agreement.
8.11. ADDITIONAL SECURITY; FURTHER ASSURANCES. (a) In the event that
at any time any person becomes a Subsidiary of the Borrower or any of its
Subsidiaries, the Borrower will promptly, and in any event within 30 days after
the person becomes a Subsidiary, notify the Administrative Agent thereof and of
the rights of the Administrative Agent and the Lenders under this section
8.11(a). If requested by the Administrative Agent or the Required Lenders, the
Borrower will, or will cause the Subsidiary which owns the capital stock or
other equity interests in such person which has become a Subsidiary to, enter
into or join in the Pledge Agreement, and pledge or cause to be pledged to the
Collateral Agent all capital stock and other equity interests in such person
(and any other Collateral of the nature described in the Pledge Agreement) which
are owned by the Borrower or any Subsidiary, as the case may be, to the
Collateral Agent, for the benefit of the Secured Creditors (as defined in the
Pledge Agreement).
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(b) In the event that at any time after the Closing Date
(x) the Borrower or any Subsidiary acquires, or a person
which has become a Subsidiary owns or holds an interest in any Real
Property or any other property or interest, located in the United
States, which is not at the time included in the Collateral and is not
subject to a Permitted Lien securing Indebtedness, the Borrower will
notify the Administrative Agent in writing of such event, identifying
the property in question and referring specifically to the rights of
the Administrative Agent and the Lenders under this section,
(y) the Borrower or any Subsidiary at any time owns or
holds an interest in any Real Property or any other property or
interest, located in the United States, (1) which is not at the time
included in the Collateral and is not subject to a Permitted Lien
securing Indebtedness, and (2) as to which the Administrative Agent on
its own initiative or upon instructions from the Required Lenders has
notified the Borrower that it requires that the same be included in the
Collateral, or
(z) an Event of Default shall have occurred and be
continuing and the Borrower or any Subsidiary at any time owns or holds
an interest in any Real Property or any other property or interest,
located within or outside of the United States, which is not at the
time included in the Collateral and is not subject to a Permitted Lien
securing Indebtedness,
the Borrower will, or will cause such Subsidiary to, within 20 days following
request by the Collateral Agent (who may make such request on its own initiative
or upon instructions from the Required Lenders), grant the Collateral Agent for
the benefit of the Secured Creditors (as defined in the Security Documents)
security interests and mortgages (each an "ADDITIONAL SECURITY DOCUMENT") in
such interests or properties of the Borrower or any Subsidiary, subject to
obtaining any required consents from third parties (including third party
lessors and co-venturers) necessary to be obtained for the granting of a Lien on
the interests or assets involved (with the Borrower hereby agreeing to use its
reasonable best efforts to obtain such consents), and also subject to the
provisions of section 8.11(b). Each Additional Security Document (i) shall be
granted pursuant to documentation satisfactory in form and substance to the
Administrative Agent and the Collateral Agent, which documentation shall in the
case of Real Property or interests therein be accompanied by such Phase I
environmental assessments, surveys and surveyor's certifications, a mortgage
policy of title insurance, consents of landlords and other supporting
documentation requested by and satisfactory in form and substance to the
Administrative Agent and the Collateral Agent; and (ii) shall constitute a valid
and enforceable perfected Lien upon the interests or properties so included in
the Collateral, superior to and prior to the rights of all third persons and
subject to no other Liens except those permitted by section 9.3 or otherwise
agreed by the Administrative Agent at the time of perfection thereof and (in the
case of Real Property or interests therein) such other encumbrances as may be
set forth in the mortgage policy, if any, relating to such Additional Security
Document which shall be delivered to the Collateral Agent together with such
Additional Security Document and which shall be satisfactory in form and
substance to the Collateral Agent. The Borrower, at its sole cost and expense,
will cause each Additional Security Document or instruments related thereto to
be duly recorded or filed in such manner and in such places as are required by
law to establish, perfect, preserve and protect the Liens created thereby
required to be granted pursuant to the Additional Security Document, and will
pay or cause to be paid in full all taxes, fees and other charges payable in
connection therewith.
(c) The Borrower will, and will cause each of its Subsidiaries to,
at the expense of the Borrower, make, execute, endorse, acknowledge, file and/or
deliver to the Collateral Agent from time to time such conveyances, financing
statements, transfer endorsements, powers of attorney, certificates, and other
assurances or instruments and take such further steps relating to the Collateral
covered by any of the Security Documents as the Collateral Agent may reasonably
require. If at any time the Collateral Agent determines, based on applicable
law, that all applicable taxes (including, without limitation, mortgage
recording taxes or similar charges) were not paid in connection with the
recordation of any mortgage or deed of trust, the Borrower shall promptly pay
the same upon demand. Furthermore, the Borrower shall cause to be delivered to
the Collateral Agent such opinions of local counsel, appraisals, title
insurance, surveys, environmental assessments, consents of landlords, lien
waivers from landlords or mortgagees and other related documents as may be
reasonably requested by the Administrative Agent or the Collateral Agent in
connection therewith, all of which documents shall be in form and substance
satisfactory to the Administrative Agent and the Collateral Agent, except that
no title insurance or surveys shall be required for any leasehold properties
(unless the lessee has a nominal or bargain purchase option).
46
(d) The Borrower will if requested by any Lender at any time, in
order to meet any legal requirement applicable to such Lender, provide to
Administrative Agent, the Collateral Agent and the Lenders, at the sole cost and
expense of the Borrower, appraisals and other supporting documentation relating
to the any mortgage or deed of trust delivered as an Additional Security
Document hereunder, as specified by any Lender, meeting the appraisal and other
documentation requirements of the Real Estate Reform Amendments of the Financial
Institution Reform, Recovery and Enforcement Act of 1989, as amended, or any
other legal requirements applicable to any Lender, which in the case of any such
appraisal shall be prepared by one or more valuation firms of national standing,
acceptable to the Required Lenders, utilizing appraisal standards satisfying
such Amendments, Act or other legal requirements.
(e) The Borrower will provide the Administrative Agent with
sufficient copies of each Additional Security Document and any additional
supporting documents delivered in connection therewith for distribution of
copies thereof to the Lenders, and the Administrative Agent will promptly so
distribute such copies.
8.12. CASUALTY AND CONDEMNATION. (a) The Borrower will promptly (and
in any event within 10 days) furnish to the Administrative Agent and the Lenders
written notice of any casualty or other insured damage to any portion of any
material Collateral or the commencement of any action or other proceeding for
the taking of any material portion of or interest in any Collateral under power
of eminent domain or by condemnation or similar proceeding.
(b) If any event described in the preceding paragraph (a) results
in Net Proceeds (whether in the form of insurance proceeds, a condemnation award
or otherwise), the Collateral Agent is authorized to collect such Net Proceeds
and, if received by any Credit Party, the Borrower will, or will cause any
applicable Credit Party, to pay over such Net Proceeds to the Collateral Agent;
PROVIDED that (i) if the aggregate Net Proceeds in respect of such event (other
than proceeds in respect of business interruption insurance) are less than
$1,000,000, such Net Proceeds shall be paid over to or retained by the
applicable Credit Party unless a Default has occurred and is continuing, and
(ii) all proceeds of business interruption insurance shall be paid over to or
retained by the applicable Credit Party unless a Default has occurred and is
continuing. All such Net Proceeds retained by or paid over to the Collateral
Agent shall be held by the Collateral Agent as part of the Collateral and
released from time to time to pay the costs of repairing, restoring or replacing
the affected property in accordance with the terms of the applicable Security
Document, subject to the terms of the applicable Security Document regarding
application of such Net Proceeds during a Default or Event of Default.
(c) If any Net Proceeds retained by or paid over to the Collateral
Agent as provided above continue to be held by the Collateral Agent on the date
that is 9 months after the occurrence of the event giving rise to such Net
Proceeds, then such Net Proceeds shall be applied to prepay Loans in accordance
with the provisions of this Agreement applicable to the prepayment of Loans in
connection with Asset Sales.
8.13. HEDGE AGREEMENTS, ETC. In the event the Borrower or any of its
Subsidiaries determines to enter into a Hedge Agreement it may do so, PROVIDED
that (i) the purpose of such Hedge Agreement is to provide protection to the
Borrower or any such Subsidiary from fluctuations and other changes in interest
rates and currency exchange rates, as and to the extent considered reasonably
necessary by the Borrower, but without exposing the Borrower or its Subsidiaries
to predominantly speculative risks unrelated to the amount of assets,
Indebtedness or other liabilities intended to be subject to coverage on a
notional basis under all such Hedge Agreements; and (ii) in the case of any
Hedge Agreement entered into after the Effective Date, only if the proposed form
thereof (including any proposed pricing or other material terms) has been
provided to the Administrative Agent contemporaneously with the entry into such
Hedge Agreement.
8.14. SENIOR DEBT. The Borrower will at all times ensure that (a)
the claims of the Lenders in respect of the Obligations of the Borrower will not
be subordinate to, and will in all respects at least rank PARI PASSU with, the
claims of every other senior secured or unsecured creditor of the Borrower, and
(b) any Indebtedness subordinated in any manner to the claims of any other
senior secured or unsecured creditor of the Borrower will be subordinated in
like manner to such claims of the Lenders.
8.15. MORTGAGE ON WISCONSIN PROPERTY. If by November 30, 2001, the
Borrower does not sell the real property (the "WISCONSIN PROPERTY") described in
and subject to that certain Open End First Mortgage, Assignment of Leases and
Security Agreement dated as of September 9, 1999 (the "WISCONSIN MORTGAGE"), the
Borrower will execute, acknowledge and deliver to the Administrative Agent an
amendment to the Wisconsin Mortgage and all such further conveyances, documents,
mortgages and assurances as the Administrative Agent may require to perfect its
lien on and security interest in the Wisconsin Property.
47
8.16. INTELLECTUAL PROPERTY SEARCHES. Within 60 days from the
Closing Date, the Borrower will provide to the Administrative Agent the results
of searches, in form and substance reasonably satisfactory to the Administrative
Agent and its counsel, of the federal records for intellectual property
registered in the name of the Borrower or any of its Subsidiaries, along with
information regarding any liens filed against such intellectual property.
SECTION 9. NEGATIVE COVENANTS.
The Borrower hereby covenants and agrees that on the Effective Date and
thereafter for so long as this Agreement is in effect and until such time as the
Total Commitment has been terminated, no Notes remain outstanding and the Loans,
together with interest, Fees and all other Obligations incurred hereunder are
paid in full:
9.1. CHANGES IN BUSINESS. Neither the Borrower nor any of its
Subsidiaries will engage in any business which is not the same as or
complementary to the business engaged in by the Borrower on the Effective Date,
or make any changes in any such business if, as a result, the general nature of
the business, taken on a consolidated basis, which would then be engaged in by
the Borrower and its Subsidiaries, would be substantially changed from the
general nature of the business engaged in by the Borrower and its Subsidiaries,
taken as a whole, on the date hereof.
9.2. CONSOLIDATION, MERGER, ACQUISITIONS, SALE OF ASSETS, ETC. The
Borrower will not, and will not permit any Subsidiary to, wind up, liquidate or
dissolve its affairs, or enter into any transaction of merger or consolidation
or sell or otherwise dispose of any of its property or assets (but excluding any
sale or disposition of inventory, or obsolete or excess furniture, fixtures or
equipment or excess vacant land, in each case in the ordinary course of
business), or purchase, lease or otherwise acquire (in one transaction or a
series of related transactions) all or any part of the property or assets of any
person (excluding any purchases, leases or other acquisitions of property or
assets in, and for use in, the ordinary course of business) or agree to do any
of the foregoing at any future time, EXCEPT that the following shall be
permitted:
(A) PERMITTED INVESTMENTS: the investments permitted
pursuant to section 9.5;
(B) CERTAIN INTERCOMPANY MERGERS, ETC.: if no Default or
Event of Default shall have occurred and be continuing or would result
therefrom, (i) the merger, consolidation or amalgamation of any
Wholly-Owned Subsidiary with or into the Borrower or another
Wholly-Owned Subsidiary, so long as in any merger, consolidation or
amalgamation involving the Borrower, the Borrower is the surviving or
continuing or resulting corporation, or the liquidation or dissolution
of any Subsidiary, or (ii) the transfer or other disposition of any
property by the Borrower to any Wholly-Owned Subsidiary or by any
Wholly-Owned Subsidiary to the Borrower or any other Wholly-Owned
Subsidiary of the Borrower;
(C) PERMITTED ACQUISITIONS: if no Default or Event of
Default shall have occurred and be continuing or would result
therefrom, the Borrower or any Subsidiary may make Permitted
Acquisitions, PROVIDED that (i) all conditions to any such Permitted
Acquisition contained in the definition of the term Permitted
Acquisition are satisfied, and (ii) at least 10 Business Days prior to
the date of any such Permitted Acquisition, the Borrower shall have
delivered to the Administrative Agent an officer's certificate executed
on behalf of the Borrower by an Authorized Officer of the Borrower,
which certificate shall (A) contain the date such Permitted Acquisition
is scheduled to be consummated, (B) contain the estimated purchase
price of such Permitted Acquisition, (C) contain a description of the
property and/or assets acquired in connection with such Permitted
Acquisition, (D) contain copies of the financial statements of the
Borrower and its Subsidiaries for the most recent Testing Period and
for the acquired business or person for its most recent fiscal year and
for the most recent Testing Period and other pertinent financial
information with respect to the business to be acquired in such
Permitted Acquisition, (E) demonstrate in reasonable detail that the
Borrower is and, after the Acquisition, will be in compliance with
sections 9.7, 9.8 and 9.11, and (F) if requested by the Administrative
Agent, attach thereto a true and correct copy of the then proposed
purchase agreement, merger agreement or similar agreement, partnership
agreement and/or other contract entered into (or to be entered into) in
connection with such Permitted Acquisition;
(D) PERMITTED DISPOSITIONS: if no Default or Event of
Default shall have occurred and be continuing or would result
therefrom, the Borrower or any of its Subsidiaries may (i) sell any
property, land or building (including any related receivables or other
intangible assets) to any person which is not a Subsidiary of
48
the Borrower, or (ii) sell the entire capital stock (or other equity
interests) and Indebtedness of any Subsidiary owned by the Borrower or
any other Subsidiary to any person which is not a Subsidiary of the
Borrower, or (iii) permit any Subsidiary to be merged or consolidated
with a person which is not an Affiliate of the Borrower, or (iv)
consummate any other Asset Sale with a person who is not a Subsidiary
of the Borrower; PROVIDED that (A) the consideration for such
transaction represents fair value (as determined by management of the
Borrower), and at least 90% of such consideration consists of cash, (B)
in the case of any such transaction involving consideration in excess
of $2,000,000, at least five Business Days prior to the date of
completion of such transaction the Borrower shall have delivered to the
Administrative Agent an officer's certificate executed on behalf of the
Borrower by an Authorized Officer of the Borrower, which certificate
shall contain a description of the proposed transaction, the date such
transaction is scheduled to be consummated, the estimated purchase
price or other consideration for such transaction, financial
information pertaining to compliance with the preceding clause (A), and
which shall (if requested by the Administrative Agent) include a
certified copy of the draft or definitive documentation pertaining
thereto, and (C) contemporaneously therewith, the Borrower prepays
Loans as and to the extent contemplated by section 5.2(b);
(E) CAPITAL EXPENDITURES: Consolidated Capital
Expenditures permitted by section 9.9; and
(F) LEASES: the Borrower or any of its Subsidiaries may
enter into leases of property or assets not constituting Permitted
Acquisitions in the ordinary course of business not otherwise in
violation of this Agreement.
To the extent the Required Lenders (or all of the Lenders as shall be required
by section 12.12) waive the provisions of this section 9.2 with respect to the
sale, transfer or other disposition of any Collateral, or any Collateral is
sold, transferred or disposed of as permitted by this section 9.2, (i) such
Collateral shall be sold, transferred or disposed of free and clear of the Liens
created by the respective Security Documents; (ii) if such Collateral includes
all of the capital stock of a Subsidiary which is a party to the Subsidiary
Guaranty or the Pledge Agreement, such capital stock shall be released from the
Pledge Agreement and such Subsidiary shall be released from the Subsidiary
Guaranty; and (iii) the Administrative Agent and the Collateral Agent are hereby
authorized to take actions deemed appropriate by them in order to effectuate the
foregoing.
9.3. LIENS. The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with
respect to any property or assets of any kind (real or personal, tangible or
intangible) of the Borrower or any such Subsidiary whether now owned or
hereafter acquired, or sell any such property or assets subject to an
understanding or agreement, contingent or otherwise, to repurchase such property
or assets (including sales of accounts receivable or notes with or without
recourse to the Borrower or any of its Subsidiaries, other than for purposes of
collection of delinquent accounts in the ordinary course of business) or assign
any right to receive income, or file or permit the filing of any financing
statement under the UCC or any other similar notice of Lien under any similar
recording or notice statute, EXCEPT that the foregoing restrictions shall not
apply to:
(a) the Standard Permitted Liens; and
(b) Liens which
(i) are placed upon equipment or machinery used
in the ordinary course of business of the Borrower or any
Subsidiary at the time of (or within 180 days after) the
acquisition thereof by the Borrower or any such Subsidiary to
secure Indebtedness incurred to pay or finance all or a
portion of the purchase price thereof, PROVIDED that the Lien
encumbering the equipment or machinery so acquired does not
encumber any other asset of the Borrower or any such
Subsidiary; or
(ii) are existing on property or other assets at
the time acquired by the Borrower or any Subsidiary or on
assets of a person at the time such person first becomes a
Subsidiary of the Borrower; PROVIDED that (A) any such Liens
were not created at the time of or in contemplation of the
acquisition of such assets or person by the Borrower or any of
its Subsidiaries; (B) in the case of any such acquisition of a
person, any such Lien attaches only to the property and assets
of such person; and (C) in the case of any such acquisition of
property or assets by the Borrower or any Subsidiary, any such
Lien attaches only to the property and assets so acquired and
not to any other property or assets of the Borrower or any
Subsidiary;
49
PROVIDED that (1) the Indebtedness secured by any such Lien
does not exceed 100% of the fair market value of the property
and assets to which such Lien attaches, determined at the time
of the acquisition of such property or asset or the time at
which such person becomes a Subsidiary of the Borrower (except
in the circumstances described in clause (ii) above to the
extent such Liens constituted customary purchase money Liens
at the time of incurrence and were entered into in the
ordinary course of business), and (2) the Indebtedness secured
thereby is permitted by section 9.4(c).
9.4. INDEBTEDNESS. The Borrower will not, and will not permit any
of its Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness of the Borrower or any of its Subsidiaries, EXCEPT:
(a) Indebtedness incurred under this Agreement and the
other Credit Documents;
(b) Indebtedness of the Borrower or any Subsidiary in
respect of Capital Leases; PROVIDED that (i) the aggregate Capitalized
Lease Obligations of the Borrower and its Subsidiaries, plus the
aggregate outstanding principal amount of Indebtedness permitted under
clause (c) below, shall not exceed $2,000,000 in the aggregate at any
time outstanding, and (ii) at the time of any incurrence thereof after
the date hereof, and after giving effect thereto, no Event of Default
shall have occurred and be continuing or would result therefrom;
(c) Indebtedness of the Borrower or any Subsidiary
subject to Liens permitted by section 9.3(b), including and any
guaranty by the Borrower of any such Indebtedness; PROVIDED that (i)
the aggregate principal amount of such Indebtedness shall not exceed
$1,000,000 in the aggregate at any time outstanding, and (ii) at the
time of any incurrence thereof after the date hereof, and after giving
effect thereto, no Event of Default shall have occurred and be
continuing or would result therefrom;
(d) Indebtedness of the Borrower or any Subsidiary under
any lease which constitutes a synthetic leases (i.e. a lease classified
under GAAP as an operating lease as to which the lessee is the "owner"
of the leased property for Federal income tax purposes), including and
any guaranty by the Borrower of any such Indebtedness; PROVIDED that
(i) the aggregate cost to the lessors of all property subject to such
leases which has not been amortized by lease payments shall not exceed
$10,000,000 in the aggregate at any time outstanding, and (ii) at the
time of any incurrence thereof after the date hereof, and after giving
effect thereto, no Event of Default shall have occurred and be
continuing or would result therefrom;
(e) Existing Indebtedness, to the extent not otherwise
permitted pursuant to the foregoing clauses; and any refinancing,
extension, renewal or refunding of any such Existing Indebtedness not
involving an increase in the principal amount thereof or a reduction of
more than 10% in the remaining weighted average life to maturity
thereof (computed in accordance with standard financial practice);
(f) Indebtedness of the Borrower or any Subsidiary under
Hedge Agreements;
(g) Indebtedness of the Borrower to any of its
Subsidiaries, and Indebtedness of any of the Borrower's Subsidiaries to
the Borrower or to another Subsidiary of the Borrower, in each case to
the extent permitted under section 9.5;
(h) Guaranty Obligations permitted under section 9.5; and
(i) Subordinated Indebtedness.
9.5. ADVANCES, INVESTMENTS, LOANS AND GUARANTY OBLIGATIONS. The
Borrower will not, and will not permit any of its Subsidiaries to, (1) lend
money or credit or make advances to any person, (2) purchase or acquire any
stock, obligations or securities of, or any other interest in, or make any
capital contribution to, or other investment in, any person, (3) create, acquire
or hold any Subsidiary, (4) be or become a party to any joint venture or
partnership, or (5) be or become obligated under any Guaranty Obligations (other
than those created in favor of the Lenders pursuant to the Credit Documents),
EXCEPT:
(a) the Borrower or any of its Subsidiaries may invest in
cash and Cash Equivalents;
50
(b) any endorsement of a check or other medium of payment
for deposit or collection, or any similar transaction in the normal
course of business;
(c) the Borrower and its Subsidiaries may acquire and
hold receivables owing to them in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms;
(d) investments acquired by the Borrower or any of its
Subsidiaries (i) in exchange for any other investment held by the
Borrower or any such Subsidiary in connection with or as a result of a
bankruptcy, workout, reorganization or recapitalization of the issuer
of such other investment, or (ii) as a result of a foreclosure by the
Borrower or any of its Subsidiaries with respect to any secured
investment or other transfer of title with respect to any secured
investment in default;
(e) loans and advances to employees for business-related
travel expenses, moving expenses, costs of replacement homes and other
similar expenses, in each case incurred in the ordinary course of
business, shall be permitted;
(f) investments in the capital of any Wholly-Owned
Subsidiary which is not a Foreign Subsidiary;
(g) to the extent not permitted by the foregoing clauses,
existing investments in any Subsidiaries (and any increases thereof
attributable to increases in retained earnings);
(h) to the extent not permitted by the foregoing clauses,
the existing loans, advances, investments and guarantees described on
Annex V hereto;
(i) any unsecured guaranty by the Borrower of any
Indebtedness of a Subsidiary permitted by section 9.4, and any guaranty
by any Subsidiary described in section 9.4;
(j) investments of the Borrower and its Subsidiaries in
Hedge Agreements;
(k) loans and advances by any Subsidiary of the Borrower
to the Borrower, PROVIDED that the Indebtedness represented thereby
constitutes Subordinated Indebtedness;
(l) loans and advances by the Borrower or by any
Subsidiary of the Borrower to, or other investments in, any Subsidiary
of the Borrower which is (i) a Subsidiary Guarantor, (ii) a
Wholly-Owned Subsidiary, and (iii) not a Foreign Subsidiary;
(m) loans and advances by any Subsidiary of the Borrower
which is not a Subsidiary Guarantor to, or other investments by any
such Subsidiary in, any other Subsidiary of the Borrower which is a
Wholly-Owned Subsidiary;
(n) Guaranty Obligations, not otherwise permitted by the
foregoing clauses, of (i) the Borrower or any Subsidiary in respect of
leases of the Borrower or any Subsidiary the entry into which is not
prohibited by this Agreement, (ii) the Borrower or any Subsidiary in
respect of any other person (other than in respect of (x) Indebtedness
for borrowed money or represented by bonds, notes, debentures or
similar securities, or (y) Indebtedness constituting Capital Leases)
arising as a matter of applicable law because the Borrower or such
Subsidiary is or is deemed to be a general partner of such other
person, or (iii) the Borrower or any Subsidiary in respect of any other
person (other than in respect of (x) Indebtedness for borrowed money or
represented by bonds, notes, debentures or similar securities, or (y)
Indebtedness constituting Capital Leases) arising in the ordinary
course of business;
(o) Acquisitions permitted under section 9.2, and loans,
advances and investments of any person which are outstanding at the
time such person becomes a Subsidiary of the Borrower as a result of an
Acquisition permitted by section 9.2, but not any increase in the
amount thereof; and
(p) any other loans, advances, investments (whether in
the form of cash or contribution of property, and if in the form of a
contribution of property, such property shall be valued for purposes of
this clause (p) at the fair value thereof as reasonably determined by
the Borrower) and Guaranty Obligations,
51
including, without limitation, in or to or for the benefit of,
Subsidiaries, joint ventures, or other persons, not otherwise permitted
by the foregoing clauses, made after the end of the most recent fiscal
quarter of the Borrower for which financial statements were furnished
to the Lenders prior to the Effective Date (such loans, advances and
investments and Guaranty Obligations, collectively, "BASKET INVESTMENTS
AND GUARANTEES"), shall be permitted to be incurred if (i) no Event of
Default shall have occurred and be continuing, or would result
therefrom, (ii) the aggregate Basket Investments and Guarantees
outstanding at any time does not exceed $10,000,000 and (iii) no more
than $900,000 of the aggregate Basket Investments and Guarantees
outstanding at any time (exclusive of any unpaid or accrued interest
thereon) consists of loans or advances to, and Guaranty Obligations
incurred to support Indebtedness of, officers, directors and employees
of the Borrower and its Subsidiaries.
9.6. DIVIDENDS, ETC. The Borrower will not (a) directly or
indirectly declare, order, pay or make any dividend (other than dividends
payable solely in capital stock of the Borrower) or other distribution on or in
respect of any capital stock of any class of the Borrower, whether by reduction
of capital or otherwise, or (b) directly or indirectly make, or permit any of
its Subsidiaries to directly or indirectly make, any purchase, redemption,
retirement or other acquisition of any capital stock of any class of the
Borrower (other than for a consideration consisting solely of capital stock of
the same class of the Borrower) or of any warrants, rights or options to acquire
or any securities convertible into or exchangeable for any capital stock of the
Borrower, EXCEPT that if no Event of Default shall have occurred and be
continuing or would result therefrom,
(i) the Borrower shall be permitted to declare and pay
cash dividends of up to 100% of the net after tax proceeds of any
extraordinary or other non-recurring cash gain, if such dividend is
declared and paid within 90 days following the recognition of such
gain; and
(ii) the Borrower and its Subsidiaries shall be permitted
to purchase and/or repurchase for cash consideration shares of common
stock of the Borrower (and any associated rights), if the aggregate
amount expended for such purposes subsequent to the Closing Date does
not exceed $5,000,000.
9.7. CONSOLIDATED TOTAL INDEBTEDNESS/CONSOLIDATED EBITDA RATIO. The
Borrower will not at any time permit the ratio of (i) the amount of Consolidated
Total Indebtedness at such time to (ii) Consolidated EBITDA for any Testing
Period, to exceed 2.50 to 1.00.
9.8. COVERAGE RATIOS. (A) INTEREST COVERAGE RATIO. The Borrower
will not permit its ratio of (i) the sum of Consolidated EBIT plus Consolidated
Amortization, to (ii) Consolidated Interest Expense, for any Testing Period to
be less than 2.25 to 1.00.
(B) FIXED CHARGE COVERAGE RATIO. The Borrower will not permit its
ratio of (i) Consolidated EBITDA for any Testing Period, to (ii) the sum for
such Testing Period of (1) Consolidated Interest Expense, (2) Consolidated
Income Tax Expense, (3) scheduled or mandatory repayments, prepayments or
redemptions of the principal of any Indebtedness other than the Obligations
hereunder (including the principal portion of any Capitalized Lease), (4)
Consolidated Capital Expenditures, and (5) capitalized commissions, to be less
than 1.10 to 1.00; PROVIDED, HOWEVER, that specified capitalized commissions
shall be excluded from computations of the foregoing ratio if, prior to making
payment of any such specified capitalized commissions, the Borrower has
requested that the Required Lenders consent in writing to such exclusion of such
specified capitalized commissions and the Required Lenders have signed and
delivered a written consent to such effect, any such consent not to be
unreasonably withheld by any Lender.
9.9. CAPITAL EXPENDITURES. The Borrower will not, and will not
permit any of its Subsidiaries to, make or incur Consolidated Capital
Expenditures during any fiscal year of the Borrower in excess of $6,500,000,
except that in the event actual Consolidated Capital Expenditures for any fiscal
year are less than such amount, 50% of the difference may be carried over to the
next fiscal year, but not any subsequent fiscal year.
9.10. CERTAIN LEASES. The Borrower will not permit the aggregate
payments (excluding any property taxes, insurance or maintenance obligations
paid by the Borrower and its Subsidiaries as additional rent or lease payments)
by the Borrower and its Subsidiaries on a consolidated basis under agreements to
rent or lease any real or personal property for a period exceeding 12 months
(including any renewal or similar option periods), other than any leases
constituting Capital Leases, to exceed $3,000,000 in any fiscal year of the
Borrower.
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9.11. MINIMUM CONSOLIDATED NET WORTH. The Borrower will not permit
its Consolidated Net Worth at any time to be less than 85% of Consolidated Net
Worth at December 31, 2000, EXCEPT that (i) effective as of the end of the
Borrower's fiscal quarter ended March 31, 2001, and as of the end of each fiscal
quarter thereafter, the foregoing amount (as it may from time to time be
increased as herein provided), shall be increased by 75% of the consolidated net
income of the Borrower and its Subsidiaries for the fiscal quarter ended on such
date, if any, as determined in conformity with GAAP (there being no reduction in
the case of any such consolidated net income which reflects a deficit), (ii) the
foregoing amount (as it may from time to time be increased as herein provided),
shall be increased by an amount equal to 50% of the cash proceeds (net of
underwriting discounts and commissions and other customary fees and costs
associated therewith) from any sale or issuance of equity by the Borrower after
the Closing Date (other than any sale or issuance to management or employees
pursuant to employee benefit plans of general application), (iii) the foregoing
amount (as it may from time to time be increased as herein provided), shall be
increased by an amount equal to 50% of the increase in Consolidated Net Worth
attributable to the issuance of common stock or other equity interests
subsequent to the Closing Date as consideration in any Acquisitions permitted
under section 9.2, (iv) the foregoing amount (as it may from time to time be
increased or decreased as herein provided), shall be decreased by 90% of the
aggregate amount expended by the Borrower and its Subsidiaries subsequent to the
Closing Date for the purchase or repurchase of shares of common stock of the
Borrower (and any associated rights).
9.12. PREPAYMENTS AND REFINANCINGS OF OTHER DEBT, ETC. The Borrower
will not, and will not permit any of its Subsidiaries to, make (or give any
notice in respect thereof) any voluntary or optional payment or prepayment or
redemption or acquisition for value of (including, without limitation, by way of
depositing with the trustee with respect thereto money or securities before due
for the purpose of paying when due) or exchange of, or refinance or refund, any
Indebtedness of the Borrower or its Subsidiaries (other than the Obligations and
intercompany loans and advances among the Borrower and its Subsidiaries);
PROVIDED that the Borrower or any Subsidiary may refinance or refund any such
Indebtedness if the aggregate principal amount thereof is not increased and the
weighted average life to maturity thereof (computed in accordance with standard
financial practice) is not reduced by more than 10%.
9.13. TRANSACTIONS WITH AFFILIATES. The Borrower will not, and will
not permit any Subsidiary to, enter into any transaction or series of
transactions with any Affiliate (other than, in the case of the Borrower, any
Subsidiary, and in the case of a Subsidiary, the Borrower or another Subsidiary)
other than in the ordinary course of business of and pursuant to the reasonable
requirements of the Borrower's or such Subsidiary's business and upon fair and
reasonable terms no less favorable to the Borrower or such Subsidiary than would
obtain in a comparable arm's-length transaction with a person other than an
Affiliate, EXCEPT (i) loans, advances and investments permitted by section 9.5,
(ii) sales of goods to an Affiliate for use or distribution outside the United
States which in the good faith judgment of the Borrower complies with any
applicable legal requirements of the Code, or (iii) agreements and transactions
with and payments to officers, directors and shareholders which are either (A)
entered into in the ordinary course of business and not prohibited by any of the
provisions of this Agreement, or (B) entered into outside the ordinary course of
business, approved by the directors or shareholders of the Borrower, and not
prohibited by any of the provisions of this Agreement.
9.14. LIMITATION ON CERTAIN RESTRICTIVE AGREEMENTS. The Borrower
will not, and will not permit any of its Subsidiaries to, directly or
indirectly, enter into, incur or permit to exist or become effective, any
agreement or other arrangement that prohibits, restricts or imposes any
condition upon (a) the ability of the Borrower or any Subsidiary to create,
incur or suffer to exist any Lien upon any of its property or assets as security
for Indebtedness, or (b) the ability of any such Subsidiary to pay dividends or
make any other distributions on its capital stock or any other interest or
participation in its profits owned by the Borrower or any Subsidiary of the
Borrower, or pay any Indebtedness owed to the Borrower or a Subsidiary of the
Borrower, or to make loans or advances to the Borrower or any of the Borrower's
other Subsidiaries, or transfer any of its property or assets to the Borrower or
any of the Borrower's other Subsidiaries, EXCEPT for such restrictions existing
under or by reason of (i) applicable law, (ii) this Agreement and the other
Credit Documents, (iii) customary provisions restricting subletting or
assignment of any lease governing a leasehold interest, (iv) customary
provisions restricting assignment of any licensing agreement entered into in the
ordinary course of business, (v) customary provisions restricting the transfer
of assets subject to Liens permitted under section 9.3(b), (vi) restrictions
contained in the Existing Indebtedness Agreements as in effect on the Effective
Date and customary restrictions affecting only a Subsidiary of the Borrower
under any agreement or instrument governing any of the Indebtedness of a
Subsidiary permitted pursuant to 9.4, (vii) any document relating to
Indebtedness secured by a Lien permitted by section 9.3, insofar as the
provisions thereof limit grants of junior liens on the assets securing such
Indebtedness, and (viii) any operating lease or Capital Lease, insofar as the
provisions thereof limit grants of a security interest in, or other assignments
of, the related leasehold interest to any other person.
53
9.15. PLAN TERMINATIONS, MINIMUM FUNDING, ETC. The Borrower will
not, and will not permit any ERISA Affiliate to, (i) terminate any Plan or plans
so as to result in liability of the Borrower or any ERISA Affiliate to the PBGC
in excess of $1,000,000 in the aggregate, (ii) permit to exist one or more
events or conditions which reasonably present a material risk of the termination
by the PBGC of any Plan or Plans with respect to which the Borrower or any ERISA
Affiliate would, in the event of such termination, incur liability to the PBGC
in excess of $1,000,000 in the aggregate, or (iii) fail to comply with the
minimum funding standards of ERISA and the Code with respect to any Plan.
SECTION 10. EVENTS OF DEFAULT.
10.1. EVENTS OF DEFAULT. Upon the occurrence of any of the following
specified events (each an "EVENT OF DEFAULT"):
(A) PAYMENTS: the Borrower shall (i) default in the
payment when due of any principal of the Loans or any reimbursement
obligation in respect of any Unpaid Drawing; or (ii) default, and such
default shall continue for five or more days, in the payment when due
of any interest on the Loans or any Fees or any other amounts owing
hereunder or under any other Credit Document; or
(B) REPRESENTATIONS, ETC.: any representation, warranty
or statement made by the Borrower herein or in any other Credit
Document or in any statement or certificate delivered or required to be
delivered pursuant hereto or thereto shall prove to be untrue in any
material respect on the date as of which made or deemed made; or
(C) CERTAIN NEGATIVE COVENANTS: the Borrower shall
default in the due performance or observance by it of any term,
covenant or agreement contained in sections 9.2 through 9.11 of this
Agreement; or
(D) OTHER COVENANTS: the Borrower shall default in the
due performance or observance by it of any term, covenant or agreement
contained in this Agreement or any other Credit Document, other than
those referred to in section 10.1(a) or (b) or (c) above, and such
default shall not be remedied within 30 days after the earlier of (i)
an officer of the Borrower obtaining actual knowledge of such default
or (ii) the Borrower receiving written notice of such default from the
Administrative Agent or the Required Lenders (any such notice to be
identified as a "notice of default " and to refer specifically to this
paragraph); or
(E) DEFAULT UNDER OTHER AGREEMENTS: the Borrower or any
of its Subsidiaries shall (i) default in any payment with respect to
any Indebtedness (other than the Obligations) owed to any Lender, or
having an unpaid principal amount of $1,000,000 or greater, and such
default shall continue after the applicable grace period, if any,
specified in the agreement or instrument relating to such Indebtedness,
or (ii) default in the observance or performance of any agreement or
condition relating to any such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto (and
all grace periods applicable to such observance, performance or
condition shall have expired), or any other event shall occur or
condition exist, the effect of which default or other event or
condition is to cause, or to permit the holder or holders of such
Indebtedness (or a trustee or agent on behalf of such holder or
holders) to cause any such Indebtedness to become due prior to its
stated maturity; or any such Indebtedness of the Borrower or any of its
Subsidiaries shall be declared to be due and payable, or shall be
required to be prepaid (other than by a regularly scheduled required
prepayment or redemption, prior to the stated maturity thereof); or
(F) OTHER CREDIT DOCUMENTS: the Subsidiary Guaranty or
any Security Document (once executed and delivered) shall cease for any
reason (other than termination in accordance with its terms) to be in
full force and effect; or any Credit Party shall default in any payment
obligation thereunder; or any Credit Party shall default in any
material respect in the due performance and observance of any other
obligation thereunder and such default shall continue unremedied for a
period of at least 30 days after notice by the Administrative Agent or
the Required Lenders; or any Credit Party shall (or seek to) disaffirm
or otherwise limit its obligations thereunder otherwise than in strict
compliance with the terms thereof; or
54
(G) JUDGMENTS: one or more judgments or decrees shall be
entered against the Borrower and/or any of its Subsidiaries involving a
liability (whether or not covered by insurance) of $2,000,000 or more
in the aggregate for all such judgments and decrees for the Borrower
and its Subsidiaries) and any such judgments or decrees shall not have
been vacated, discharged or stayed or bonded pending appeal within 30
days from the entry thereof; or
(H) BANKRUPTCY, ETC.: any of the following shall occur:
(i) the Borrower, any of its Material
Subsidiaries or any other Credit Party (the Borrower and each
of such other persons, each a "PRINCIPAL PARTY") shall
commence a voluntary case concerning itself under Title 11 of
the United States Code entitled "Bankruptcy," as now or
hereafter in effect, or any successor thereto (the "BANKRUPTCY
CODE"); or
(ii) an involuntary case is commenced against any
Principal Party and the petition is not controverted within 10
days, or is not dismissed within 90 days, after commencement
of the case; or
(iii) a custodian (as defined in the Bankruptcy
Code) is appointed for, or takes charge of, all or
substantially all of the property of any Principal Party; or
(iv) any Principal Party commences (including by
way of applying for or consenting to the appointment of, or
the taking of possession by, a rehabilitator, receiver,
custodian, trustee, conservator or liquidator (collectively, a
"CONSERVATOR") of itself or all or any substantial portion of
its property) any other proceeding under any reorganization,
arrangement, adjustment of debt, relief of debtors,
dissolution, insolvency, liquidation, rehabilitation,
conservatorship or similar law of any jurisdiction whether now
or hereafter in effect relating to such Principal Party; or
(v) any such proceeding is commenced against any
Principal Party to the extent such proceeding is consented by
such person or remains undismissed for a period of 90 days; or
(vi) any Principal Party is adjudicated insolvent
or bankrupt; or
(vii) any order of relief or other order approving
any such case or proceeding is entered; or
(viii) any Principal Party suffers any appointment
of any conservator or the like for it or any substantial part
of its property which continues undischarged or unstayed for a
period of 90 days; or
(ix) any Principal Party makes a general
assignment for the benefit of creditors; or
(x) any corporate (or similar organizational)
action is taken by any Principal Party for the purpose of
effecting any of the foregoing; or
(I) ERISA: (i) any of the events described in clauses (i)
through (viii) of section 8.1(h) shall have occurred; or (ii) there
shall result from any such event or events the imposition of a lien,
the granting of a security interest, or a liability or a material risk
of incurring a liability; and (iii) any such event or events or any
such lien, security interest or liability, individually, and/or in the
aggregate, in the opinion of the Required Lenders, has had, or would
reasonably be likely to have, a Material Adverse Effect; and
(J) MATERIAL ADVERSE EFFECT: any event or circumstance
referred to in section 7.9 shall occur or exist which has a Material
Adverse Effect upon the Borrower, as compared to the business,
operations, property, assets, liabilities or financial condition of the
Borrower and its Subsidiaries, taken as a whole, as reflected in the
financial statements referred to in section 7.8.
10.2. ACCELERATION, ETC. Upon the occurrence of any Event of
Default, and at any time thereafter, if any Event of Default shall then be
continuing, the Administrative Agent shall, upon the written request of the
Required Lenders, by written notice to the Borrower, take any or all of the
following actions (PROVIDED that, if an Event of Default
55
specified in section 10.1(h) shall occur with respect to the Borrower, the
result which would occur upon the giving of written notice by the Administrative
Agent as specified in clauses (i) and (ii) below shall occur automatically
without the giving of any such notice): (i) declare the Total Commitment
terminated, whereupon the Commitment of each Lender shall forthwith terminate
immediately without any other notice of any kind; (ii) declare the principal of
and any accrued interest in respect of all Loans, all Unpaid Drawings and all
obligations owing hereunder and thereunder to be, whereupon the same shall
become, forthwith due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrower; (iii)
terminate any Letter of Credit which may be terminated in accordance with its
terms; and (iv) direct the Borrower to pay (and the Borrower hereby agrees that
on receipt of such notice or upon the occurrence of an Event of Default with
respect to the Borrower under section 10.1(h), it will pay) to the
Administrative Agent an amount of cash equal to the aggregate Stated Amount of
all Letters of Credit then outstanding (such amount to be held as security after
the Borrower's reimbursement obligations in respect thereof).
10.3. APPLICATION OF LIQUIDATION PROCEEDS. All monies received by
the Administrative Agent or any Lender from the exercise of remedies hereunder
or under the other Credit Documents or under any other documents relating to
this Agreement shall, unless otherwise required by the terms of the other Credit
Documents or by applicable law, be applied as follows:
(I) FIRST, to the payment of all expenses (to the extent
not paid by the Borrower) incurred by the Administrative Agent and the
Lenders in connection with the exercise of such remedies, including,
without limitation, all reasonable costs and expenses of collection,
attorneys' fees, court costs and any foreclosure expenses;
(II) SECOND, to the payment PRO RATA of interest then
accrued on the outstanding Loans;
(III) THIRD, to the payment PRO RATA of any fees then
accrued and payable to the Administrative Agent, any
Letter of Credit Issuer or any Lender under this Agreement in respect
of the Loans or the Letter of Credit Outstandings;
(IV) FOURTH, to the payment PRO RATA of (A) the principal
balance then owing on the outstanding Loans, (B) the amounts then due
under Designated Hedge Agreements to creditors of the Borrower or any
Subsidiary, subject to confirmation by the Administrative Agent of any
calculations of termination or other payment amounts being made in
accordance with normal industry practice, and (C) the Stated Amount of
the Letter of Credit Outstandings (to be held and applied by the
Administrative Agent as security for the reimbursement obligations in
respect thereof);
(V) FIFTH, to the payment to the Lenders of any amounts
then accrued and unpaid under sections 2.9, 2.10 and 3.5 hereof, and if
such proceeds are insufficient to pay such amounts in full, to the
payment of such amounts PRO RATA;
(VI) SIXTH, to the payment PRO RATA of all other amounts
owed by the Borrower to the Administrative Agent, to any Letter of
Credit Issuer or any Lender under this Agreement or any other Credit
Document, and to any counterparties under Designated Hedge Agreements
of the Borrower and its Subsidiaries, and if such proceeds are
insufficient to pay such amounts in full, to the payment of such
amounts PRO RATA; and
(VII) FINALLY, any remaining surplus after all of the
Obligations have been paid in full, to the Borrower or to whomsoever
shall be lawfully entitled thereto.
56
SECTION 11. THE ADMINISTRATIVE AGENT.
11.1. APPOINTMENT. Each Lender hereby irrevocably designates and
appoints NCB as Administrative Agent (such term to include, for the purposes of
this section 11, NCB acting as Collateral Agent) to act as specified herein and
in the other Credit Documents, and each such Lender hereby irrevocably
authorizes NCB as the Administrative Agent for such Lender, to take such action
on its behalf under the provisions of this Agreement and the other Credit
Documents and to exercise such powers and perform such duties as are expressly
delegated to the Administrative Agent by the terms of this Agreement and the
other Credit Documents, together with such other powers as are reasonably
incidental thereto. The Administrative Agent agrees to act as such upon the
express conditions contained in this section 11. Notwithstanding any provision
to the contrary elsewhere in this Agreement, the Administrative Agent shall not
have any duties or responsibilities, except those expressly set forth herein or
in the other Credit Documents, nor any fiduciary relationship with any Lender,
and no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or otherwise exist against the
Administrative Agent. The provisions of this section 11 are solely for the
benefit of the Administrative Agent, and the Lenders, and the Borrower and its
Subsidiaries shall not have any rights as a third party beneficiary of any of
the provisions hereof. In performing its functions and duties under this
Agreement, the Administrative Agent shall act solely as agent of the Lenders and
does not assume and shall not be deemed to have assumed any obligation or
relationship of agency or trust with or for the Borrower or any of its
Subsidiaries.
11.2. DELEGATION OF DUTIES. The Administrative Agent may execute any
of its duties under this Agreement or any other Credit Document by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care except to the extent
otherwise required by section 11.3.
11.3. EXCULPATORY PROVISIONS. Neither the Administrative Agent nor
any of its respective officers, directors, employees, agents, attorneys-in-fact
or affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such person under or in connection with this Agreement (except
for its or such person's own gross negligence or willful misconduct) or (ii)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by the Borrower or of its Subsidiaries or any
of their respective officers contained in this Agreement, any other Credit
Document or in any certificate, report, statement or other document referred to
or provided for in, or received by the Administrative Agent under or in
connection with, this Agreement or any other Credit Document or for any failure
of the Borrower or any Subsidiary of the Borrower or any of their respective
officers to perform its obligations hereunder or thereunder. The Administrative
Agent shall not be under any obligation to any Lender to ascertain or to inquire
as to the observance or performance of any of the agreements contained in, or
conditions of, this Agreement, or to inspect the properties, books or records of
the Borrower or any of its Subsidiaries. The Administrative Agent shall not be
responsible to any Lender for the effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Agreement or any Credit
Document or for any representations, warranties, recitals or statements made
herein or therein or made in any written or oral statement or in any financial
or other statements, instruments, reports, certificates or any other documents
in connection herewith or therewith furnished or made by the Administrative
Agent to the Lenders or by or on behalf of the Borrower or any of its
Subsidiaries to the Administrative Agent or any Lender or be required to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or therein or
as to the use of the proceeds of the Loans or of the existence or possible
existence of any Default or Event of Default.
11.4. RELIANCE BY ADMINISTRATIVE AGENT. The Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
note, writing, resolution, notice, consent, certificate, affidavit, letter,
cablegram, telegram, facsimile transmission, telex or teletype message,
statement, order or other document or conversation believed by it, in good
faith, to be genuine and correct and to have been signed, sent or made by the
proper person or persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Borrower or any of its
Subsidiaries), independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Credit
Document unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action. The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement and the other Credit Documents in
accordance with a request of the Required Lenders (or all of the Lenders, as to
any matter which, pursuant to section 12.12, can only be effectuated
57
with the consent of all Lenders), and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Lenders.
11.5. NOTICE OF DEFAULT. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Administrative Agent has received notice from a
Lender or the Borrower referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a "notice of default". In the
event that the Administrative Agent receives such a notice, the Administrative
Agent shall give prompt notice thereof to the Lenders. The Administrative Agent
shall take such action with respect to such Default or Event of Default as shall
be reasonably directed by the Required Lenders, PROVIDED 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 or Event of Default as it shall
deem advisable in the best interests of the Lenders.
11.6. NON-RELIANCE. Each Lender expressly acknowledges that neither
the Administrative Agent nor any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates have made any representations or warranties to
it and that no act by the Administrative Agent hereinafter taken, including any
review of the affairs of the Borrower or any of its 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 it has,
independently and without reliance upon the Administrative Agent, or any other
Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
assets, operations, property, financial and other conditions, prospects and
creditworthiness of the Borrower and its Subsidiaries and made its own decision
to make its Loans hereunder and enter into this Agreement. Each Lender also
represents that it will, independently and without reliance upon the
Administrative Agent, or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement, and to make such investigation as it deems necessary to inform
itself as to the business, assets, operations, property, financial and other
conditions, prospects and creditworthiness of the Borrower and its Subsidiaries.
The Administrative Agent shall not have any duty or responsibility to provide
any Lender with any credit or other information concerning the business,
operations, assets, property, financial and other conditions, prospects or
creditworthiness of the Borrower or any of its Subsidiaries which may come into
the possession of the Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.
11.7. INDEMNIFICATION. The Lenders agree to indemnify the
Administrative Agent in its capacity as such ratably according to their
respective Loans and Unutilized Commitments, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, reasonable expenses or disbursements of any kind whatsoever which may at
any time (including, without limitation, at any time following the payment of
the Obligations) be imposed on, incurred by or asserted against the
Administrative Agent in its capacity as such in any way relating to or arising
out of this Agreement or any other Credit Document, or any documents
contemplated by or referred to herein or the transactions contemplated hereby or
any action taken or omitted to be taken by the Administrative Agent under or in
connection with any of the foregoing, but only to the extent that any of the
foregoing is not paid by the Borrower, PROVIDED that no Lender shall be liable
to the Administrative Agent for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements to the extent resulting solely from the Administrative
Agent's gross negligence or willful misconduct. If any indemnity furnished to
the Administrative Agent for any purpose shall, in the opinion of the
Administrative Agent, be insufficient or become impaired, the Administrative
Agent may call for additional indemnity and cease, or not commence, to do the
acts indemnified against until such additional indemnity is furnished. The
agreements in this section 11.7 shall survive the payment of all Obligations.
11.8. THE ADMINISTRATIVE AGENT IN INDIVIDUAL CAPACITY. The
Administrative Agent and its Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower, its Subsidiaries
and their Affiliates as though not acting as Administrative Agent hereunder.
With respect to the Loans made by it and all Obligations owing to it, the
Administrative Agent shall have the same rights and powers under this Agreement
as any Lender and may exercise the same as though it were not the Administrative
Agent, and the terms "Lender" and "Lenders" shall include the Administrative
Agent in its individual capacity.
11.9. SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may
resign as the Administrative Agent upon 20 days' notice to the Lenders and the
Borrower. The Required Lenders shall appoint from among the Lenders a successor
Administrative Agent for the Lenders subject to prior approval by the Borrower
(such approval not to be
58
unreasonably withheld or delayed), whereupon such successor agent shall succeed
to the rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall include such successor agent effective upon its
appointment, and the resigning Administrative Agent's rights, powers and duties
as the Administrative Agent shall be terminated, without any other or further
act or deed on the part of such former Administrative Agent or any of the
parties to this Agreement. After the retiring Administrative Agent's resignation
hereunder as the Administrative Agent, the provisions of this section 11 shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Administrative Agent under this Agreement.
11.10. OTHER AGENTS. Any Lender identified herein as a Co-Agent,
Syndication Agent, Documentation Agent, Managing Agent, Manager or any other
corresponding title, other than "Administrative Agent" or "Collateral Agent",
shall have no right, power, obligation, liability, responsibility or duty under
this Agreement or any other Credit Document except those applicable to all
Lenders as such. Each Lender acknowledges that it has not relied, and will not
rely, on any Lender so identified in deciding to enter into this Agreement or in
taking or not taking any action hereunder.
SECTION 12. MISCELLANEOUS.
12.1. PAYMENT OF EXPENSES ETC. The Borrower agrees to:
(a) whether or not the transactions herein contemplated
are consummated, pay (or reimburse the Administrative Agent and the
Lenders for) all reasonable out-of-pocket costs and expenses of the
Administrative Agent and the Lenders in connection with the
negotiation, preparation, execution and delivery of the Credit
Documents and the documents and instruments referred to therein, the
delivery of documents on the Closing Date pursuant to section 6.1 and
the initial Borrowing hereunder, including, without limitation, the
reasonable documented fees and disbursements of ▇▇▇▇▇, Day, ▇▇▇▇▇▇ &
▇▇▇▇▇, special counsel to the Administrative Agent;
(b) pay (or reimburse the Administrative Agent and the
Lenders for) all reasonable out-of-pocket costs and expenses of the
Administrative Agent and the Lenders in connection with any amendment,
waiver or consent relating to any of the Credit Documents which is
requested by any Credit Party, including, without limitation, (i) the
reasonable documented fees and disbursements of ▇▇▇▇▇, Day, ▇▇▇▇▇▇ &
▇▇▇▇▇, special counsel to the Administrative Agent, and (ii) the
reasonable documented fees and disbursements of any individual counsel
to any Lender (including allocated costs of internal counsel);
(c) pay (or reimburse the Administrative Agent and the
Lenders for) all reasonable out-of-pocket costs and expenses of the
Administrative Agent and the Lenders in connection with the enforcement
of any of the Credit Documents or the other documents and instruments
referred to therein, including, without limitation, (i) the reasonable
documented fees and disbursements of ▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇,
special counsel to the Administrative Agent, and (ii) the reasonable
documented fees and disbursements of any individual counsel to any
Lender (including allocated costs of internal counsel);
(d) without limitation of the preceding clause (c), in
the event of the bankruptcy, insolvency, rehabilitation or other
similar proceeding in respect of the Borrower or any of its
Subsidiaries, pay all costs of collection and defense, including
reasonable documented attorneys' fees in connection therewith and in
connection with any appellate proceeding or post-judgment action
involved therein, which shall be due and payable together with all
required service or use taxes;
(e) pay and hold each of the Lenders harmless from and
against any and all present and future stamp and other similar taxes
with respect to the foregoing matters and save each of the Lenders
harmless from and against any and all liabilities with respect to or
resulting from any delay or omission (other than to the extent
attributable to such Lender) to pay such taxes; and
(f) indemnify each Lender, its officers, directors,
employees, representatives and agents (collectively, the "INDEMNITEES")
from and hold each of them harmless against any and all losses,
liabilities, claims, damages or expenses reasonably incurred by any of
them as a result of, or arising out of, or in any way related to, or by
reason of
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(i) any investigation, litigation or other
proceeding (whether or not any Lender is a party thereto)
related to the entering into and/or performance of any Credit
Document or the use of the proceeds of any Loans hereunder or
the consummation of any transactions contemplated in any
Credit Document, other than any such investigation, litigation
or proceeding arising out of transactions solely between any
of the Lenders or the Administrative Agent, transactions
solely involving the assignment by a Lender of all or a
portion of its Loans and Commitments, or the granting of
participations therein, as provided in this Agreement, or
arising solely out of any examination of a Lender by any
regulatory or other governmental authority having jurisdiction
over it, or
(ii) the actual or alleged presence of Hazardous
Materials in the air, surface water or groundwater or on the
surface or subsurface of any Real Property owned, leased or at
any time operated by the Borrower or any of its Subsidiaries,
the release, generation, storage, transportation, handling or
disposal of Hazardous Materials at any location, whether or
not owned or operated by the Borrower or any of its
Subsidiaries, if the Borrower or any such Subsidiary could
have or is alleged to have any responsibility in respect
thereof, the non-compliance of any such Real Property with
foreign, federal, state and local laws, regulations and
ordinances (including applicable permits thereunder)
applicable thereto, or any Environmental Claim asserted
against the Borrower or any of its Subsidiaries, in respect of
any such Real Property,
including, in each case, without limitation, the reasonable documented
fees and disbursements of counsel incurred in connection with any such
investigation, litigation or other proceeding (but excluding any such
losses, liabilities, claims, damages or expenses to the extent incurred
by reason of the gross negligence or willful misconduct of the person
to be indemnified or of any other Indemnitee who is such person or an
Affiliate of such person).
To the extent that the undertaking to indemnify, pay or hold harmless any person
set forth in the preceding sentence may be unenforceable because it is violative
of any law or public policy, the Borrower shall make the maximum contribution to
the payment and satisfaction of each of the indemnified liabilities which is
permissible under applicable law.
12.2. RIGHT OF SETOFF. In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence of an Event of Default, each Lender is hereby
authorized at any time or from time to time, without presentment, demand,
protest or other notice of any kind to the Borrower or to any other person, any
such notice being hereby expressly waived, to set off and to appropriate and
apply any and all deposits (general or special) and any other Indebtedness at
any time held or owing by such Lender (including, without limitation, by
branches and agencies of such Lender wherever located) to or for the credit or
the account of the Borrower against and on account of the Obligations and
liabilities of the Borrower to such Lender under this Agreement or under any of
the other Credit Documents, including, without limitation, all interests in
Obligations the Borrower purchased by such Lender pursuant to section 12.4(b),
and all other claims of any nature or description arising out of or connected
with this Agreement or any other Credit Document, irrespective of whether or not
such Lender shall have made any demand hereunder and although said Obligations,
liabilities or claims, or any of them, shall be contingent or unmatured.
12.3. NOTICES. Except as otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, facsimile transmission or cable communication)
and mailed, telegraphed, telexed, transmitted, cabled or delivered, if to the
Borrower, at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, attention: Chief
Financial Officer (facsimile: (▇▇▇) ▇▇▇-▇▇▇▇); if to any Lender at its address
specified for such Lender on Annex I hereto; if to the Administrative Agent, at
its Notice Office; or at such other address as shall be designated by any party
in a written notice to the other parties hereto. All such notices and
communications shall be mailed, telegraphed, telexed, telecopied, or cabled or
sent by overnight courier, and shall be effective when received.
12.4. BENEFIT OF AGREEMENT. (a) This Agreement shall be binding upon
and inure to the benefit of and be enforceable by the parties hereto and their
respective successors and assigns, PROVIDED that the Borrower may not assign or
transfer any of its rights or obligations hereunder without the prior written
consent of all the Lenders, and, PROVIDED, FURTHER, that any assignment by a
Lender of its rights and obligations hereunder shall be effected in accordance
with section 12.4(b). Notwithstanding the foregoing, each Lender may at any time
grant participations in any of its rights hereunder or under any of the Notes to
(x) another Lender that is not a Defaulting Lender or to an Affiliate of such
Lender which is a commercial bank, financial institution or other "accredited
investor" (as defined in SEC Regulation D), and (y)
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one or more Eligible Transferees, PROVIDED that in the case of any such
participation, (i) the participant shall not have any rights under this
Agreement or any of the other Credit Documents, including rights of consent,
approval or waiver (the participant's rights against such Lender in respect of
such participation to be those set forth in the agreement executed by such
Lender in favor of the participant relating thereto), (ii) such Lender's
obligations under this Agreement (including, without limitation, its Commitment
hereunder) shall remain unchanged, (iii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iv) such Lender shall remain the holder of any Note for all purposes of this
Agreement and (v) the Borrower, the Administrative Agent, and the other Lenders
shall continue to deal solely and directly with the selling Lender in connection
with such Lender's rights and obligations under this Agreement, and all amounts
payable by the Borrower hereunder shall be determined as if such Lender had not
sold such participation, except that the participant shall be entitled to the
benefits of sections 2.9 and 2.10 of this Agreement to the extent that such
Lender would be entitled to such benefits if the participation had not been
entered into or sold, and, PROVIDED FURTHER, that no Lender shall transfer,
grant or sell any participation under which the participant shall have rights to
approve any amendment to or waiver of this Agreement or any other Credit
Document except to the extent such amendment or waiver would (x) extend the
final scheduled maturity of the Loans in which such participant is participating
(it being understood that any waiver of the making of, or the application of ,
any mandatory prepayment to such Loans shall not constitute an extension of the
final maturity date thereof), or reduce the rate or extend the time of payment
of interest or Fees thereon (except in connection with a waiver of the
applicability of any post-default increase in interest rates), or reduce the
principal amount thereof, or increase such participant's participating interest
in any Commitment over the amount thereof then in effect (it being understood
that a waiver of any Default or Event of Default or of any mandatory prepayment
or a mandatory reduction in the such Commitment, or a mandatory prepayment,
shall not constitute a change in the terms of any such Commitment) or (y)
release any Credit Party from its obligations under the Subsidiary Guaranty, or
release all or any substantially all of the Collateral, in each case except
strictly in accordance with the terms of the Credit Documents, or (z) consent to
the assignment or transfer by the Borrower of any of its rights and obligations
under this Agreement.
(b) Notwithstanding the foregoing, (x) any Lender may assign all
or a fixed portion of its Loans and/or Commitment, and its rights and
obligations hereunder, to another Lender that is not a Defaulting Lender, or to
an Affiliate of any Lender (including itself) and which is not a Defaulting
Lender and which is a commercial bank, financial institution or other
"accredited investor" (as defined in SEC Regulation D), and (y) any Lender may
assign all, or if less than all, a fixed portion, equal to at least $5,000,000
in the aggregate for the assigning Lender or assigning Lenders, of its Loans
and/or Commitment and its rights and obligations hereunder, to one or more
Eligible Transferees, each of which assignees shall become a party to this
Agreement as a Lender by execution of an Assignment Agreement, PROVIDED that,
(i) in the case of any assignment of a portion of any Loans and/or Commitment of
a Lender, such Lender shall retain a minimum fixed portion of all Loans and
Commitments equal to at least $5,000,000, (ii) at the time of any such
assignment Annex I shall be deemed modified to reflect the Commitments of such
new Lender and of the existing Lenders, (iii) upon surrender of the old Notes,
new Notes will be issued, at the Borrower's expense, to such new Lender and to
the assigning Lender, such new Notes to be in conformity with the requirements
of section 2.5 (with appropriate modifications) to the extent needed to reflect
the revised Commitments, (iv) in the case of clause (y) only, the consent of the
Administrative Agent and each Letter of Credit Issuer shall be required in
connection with any such assignment (which consent shall not be unreasonably
withheld or delayed), and (v) the Administrative Agent shall receive at the time
of each such assignment, from the assigning or assignee Lender, the payment of a
non-refundable assignment fee of $3,500 and, PROVIDED FURTHER, that such
transfer or assignment will not be effective until recorded by the
Administrative Agent on the Lender Register maintained by it as provided herein.
To the extent of any assignment pursuant to this section 12.4(b) the assigning
Lender shall be relieved of its obligations hereunder with respect to its
assigned Commitments. At the time of each assignment pursuant to this section
12.4(b) to a person which is not already a Lender hereunder and which is not a
United States person (as such term is defined in section 7701(a)(30) of the
Code) for Federal income tax purposes, the respective assignee Lender shall
provide to the Borrower and the Administrative Agent the appropriate Internal
Revenue Service Forms (and, if applicable a Section 5.4(b)(ii) Certificate)
described in section 5.4(b). To the extent that an assignment of all or any
portion of a Lender's Commitment and related outstanding Obligations pursuant to
this section 12.4(b) would, at the time of such assignment, result in increased
costs under section 2.9 from those being charged by the respective assigning
Lender prior to such assignment, then the Borrower shall not be obligated to pay
such increased costs (although the Borrower shall be obligated to pay any other
increased costs of the type described above resulting from changes after the
date of the respective assignment). Nothing in this section 12.4(b) shall
prevent or prohibit any Lender from pledging its Notes or Loans to a Federal
Reserve Bank in support of borrowings made by such Lender from such Federal
Reserve Bank.
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(c) Notwithstanding any other provisions of this section 12.4, no
transfer or assignment of the interests or obligations of any Lender hereunder
or any grant of participation therein shall be permitted if such transfer,
assignment or grant would require the Borrower to file a registration statement
with the SEC or to qualify the Loans under the "Blue Sky" laws of any State.
(d) Each Lender initially party to this Agreement hereby
represents, and each person that became a Lender pursuant to an assignment
permitted by this section 12.4 will, upon its becoming party to this Agreement,
represent that it is a commercial lender, other financial institution or other
"accredited" investor (as defined in SEC Regulation D) which makes or acquires
loans in the ordinary course of its business and that it will make or acquire
Loans for its own account in the ordinary course of such business, PROVIDED that
subject to the preceding sections 12.4(a) and (b), the disposition of any
promissory notes or other evidences of or interests in Indebtedness held by such
Lender shall at all times be within its exclusive control.
12.5. NO WAIVER: REMEDIES CUMULATIVE. No failure or delay on the
part of the Administrative Agent or any Lender in exercising any right, power or
privilege hereunder or under any other Credit Document and no course of dealing
between the Borrower and the Administrative Agent or any Lender shall operate as
a waiver thereof; nor shall any single or partial exercise of any right, power
or privilege hereunder or under any other Credit Document preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder. The rights and remedies herein expressly provided are
cumulative and not exclusive of any rights or remedies which the Administrative
Agent or any Lender would otherwise have. No notice to or demand on the Borrower
in any case shall entitle the Borrower to any other or further notice or demand
in similar or other circumstances or constitute a waiver of the rights of the
Administrative Agent or the Lenders to any other or further action in any
circumstances without notice or demand.
12.6. PAYMENTS PRO RATA. (a) The Administrative Agent agrees that
promptly after its receipt of each payment from or on behalf of the Borrower in
respect of any Obligations, it shall distribute such payment to the Lenders
(other than any Lender that has expressly waived in writing its right to receive
its PRO RATA share thereof) PRO RATA based upon their respective shares, if any,
of the Obligations with respect to which such payment was received. As to any
such payment received by the Administrative Agent prior to 1:00 P.M. (local time
at the Payment Office) in funds which are immediately available on such day, the
Administrative Agent will use all reasonable efforts to distribute such payment
in immediately available funds on the same day to the Lenders as aforesaid.
(b) Each of the Lenders agrees that, if it should receive any
amount hereunder (whether by voluntary payment, by realization upon security, by
the exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise) which is applicable to the payment of the principal of, or interest
on, the Loans or Fees, of a sum which with respect to the related sum or sums
received by other Lenders is in a greater proportion than the total of such
Obligation then owed and due to such Lender bears to the total of such
Obligation then owed and due to all of the Lenders immediately prior to such
receipt, then such Lender receiving such excess payment shall purchase for cash
without recourse or warranty from the other Lenders an interest in the
Obligations to such Lenders in such amount as shall result in a proportional
participation by all of the Lenders in such amount, PROVIDED that if all or any
portion of such excess amount is thereafter recovered from such Lender, such
purchase shall be rescinded and the purchase price restored to the extent of
such recovery, but without interest.
(c) Notwithstanding anything to the contrary contained herein, the
provisions of the preceding sections 12.6(a) and (b) shall be subject to the
express provisions of this Agreement which require, or permit, differing
payments to be made to Lenders which are not Defaulting Lenders, as opposed to
Defaulting Lenders.
12.7. CALCULATIONS: COMPUTATIONS. (a) The financial statements to be
furnished to the Lenders pursuant hereto shall be made and prepared in
accordance with GAAP consistently applied throughout the periods involved
(except as set forth in the notes thereto or as otherwise disclosed in writing
by the Borrower to the Lenders); PROVIDED, that if at any time the computations
determining compliance with section 9 utilize accounting principles different
from those utilized in the financial statements furnished to the Lenders, such
computations shall set forth in reasonable detail a description of the
differences and the effect upon such computations.
(b) All computations of interest on Loans hereunder and all
computations of Commitment Fee, Letter of Credit Fees and other Fees hereunder
shall be made on the actual number of days elapsed over a year of 360 days.
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12.8. GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF
JURY TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN
ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE COMMONWEALTH OF KENTUCKY. TO
THE FULLEST EXTENT PERMITTED BY LAW, THE BORROWER HEREBY UNCONDITIONALLY AND
IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT THE LAW OF ANY JURISDICTION OTHER
THAN THE COMMONWEALTH OF KENTUCKY GOVERNS THIS AGREEMENT OR ANY OF THE OTHER
CREDIT DOCUMENTS. Any legal action or proceeding with respect to this Agreement
or any other Credit Document may be brought in the Jefferson Circuit Court,
Louisville, Kentucky, or in the United States District Court for the Western
District of Kentucky, and, by execution and delivery of this Agreement, the
Borrower hereby irrevocably accepts for itself and in respect of its property,
generally and unconditionally, the jurisdiction of the aforesaid courts. The
Borrower hereby further irrevocably consents to the service of process out of
any of the aforementioned courts in any such action or proceeding by the mailing
of copies thereof by registered or certified mail, postage prepaid, to the
Borrower at its address for notices pursuant to section 12.3, such service to
become effective 30 days after such mailing or at such earlier time as may be
provided under applicable law. Nothing herein shall affect the right of the
Administrative Agent or any Lender to serve process in any other manner
permitted by law or to commence legal proceedings or otherwise proceed against
the Borrower in any other jurisdiction.
(b) The Borrower hereby irrevocably waives any objection which it
may now or hereafter have to the laying of venue of any of the aforesaid actions
or proceedings arising out of or in connection with this Agreement or any other
Credit Document brought in the courts referred to in section 12.8(a) above and
hereby further irrevocably waives and agrees not to plead or claim in any such
court that any such action or proceeding brought in any such court has been
brought in an inconvenient forum.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
12.9. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same agreement. A set of counterparts
executed by all the parties hereto shall be lodged with the Borrower and the
Administrative Agent.
12.10. EFFECTIVENESS. This Agreement shall become effective on the
date (the "EFFECTIVE DATE") on which the Borrower and each of the Lenders shall
have signed a copy hereof (whether the same or different copies) and shall have
delivered the same to the Administrative Agent at the Notice Office of the
Administrative Agent or, in the case of the Lenders, shall have given to the
Administrative Agent telephonic (confirmed in writing), written telex or
facsimile transmission notice (actually received) at such office that the same
has been signed and mailed to it.
12.11. HEADINGS DESCRIPTIVE. The headings of the several sections and
other portions of this Agreement are inserted for convenience only and shall not
in any way affect the meaning or construction of any provision of this
Agreement.
12.12. AMENDMENT OR WAIVER. Neither this Agreement nor any terms
hereof or thereof may be changed, waived, discharged or terminated UNLESS such
change, waiver, discharge or termination is in writing signed by the Borrower
and the Required Lenders, PROVIDED that no such change, waiver, discharge or
termination shall, without the consent of each Lender (other than a Defaulting
Lender) affected thereby, (i) extend any maturity date provided for herein
applicable to a Loan or a Commitment (it being understood that any waiver of the
making, or application of, any mandatory prepayment of the Loans shall not
constitute an extension of the maturity date thereof), reduce the rate or extend
the time of payment of interest (other than as a result of waiving the
applicability of any post-default increase in interest rates) or Fees thereon,
or reduce the principal amount thereof, or increase the Commitment of any Lender
over the amount thereof then in effect (it being understood that a waiver of any
Default or Event of Default or of any mandatory prepayment or a mandatory
reduction in any Commitment shall not constitute a change in the terms of any
Commitment of any Lender), (ii) release the Borrower from any obligations as a
guarantor of its Subsidiaries' obligations under any Credit Document, (iii)
release any Credit Party from the Subsidiary Guaranty, except in connection with
a transaction permitted by section 9.2(d), (iv) release all or any substantial
portion of the Collateral, except strictly in accordance with the
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provisions of the Credit Documents, (v) change the definition of the term
"Change of Control" or any of the provisions of section 5.2(d) which are
applicable upon a Change of Control, (vi) amend, modify or waive any provision
of this section 12.12, or section 11.7, 12.1, 12.4, 12.6 or 12.7(b), or any
other provision of any of the Credit Documents pursuant to which the consent or
approval of all Lenders is by the terms of such provision explicitly required,
(vii) reduce the percentage specified in, or otherwise modify, the definition of
Required Lenders, or (viii) consent to the assignment or transfer by the
Borrower of any of its rights and obligations under this Agreement. No provision
of section 3 or 11 may be amended without the consent of (x) any Letter of
Credit Issuer adversely affected thereby or (y) the Administrative Agent,
respectively.
12.13. SURVIVAL OF INDEMNITIES. All indemnities set forth herein
including, without limitation, in section 2.9, 2.10, 3.5, 11.7 or 12.1 shall
survive the execution and delivery of this Agreement and the making and
repayment of Loans.
12.14. DOMICILE OF LOANS. Each Lender may transfer and carry its
Loans at, to or for the account of any branch office, subsidiary or affiliate of
such Lender, PROVIDED that the Borrower shall not be responsible for costs
arising under section 2.9 resulting from any such transfer (other than a
transfer pursuant to section 2.11) to the extent not otherwise applicable to
such Lender prior to such transfer.
12.15. CONFIDENTIALITY. Each Lender shall hold all non-public
information obtained pursuant to the requirements of this Agreement which has
been identified as such by the Borrower in accordance with its customary
procedure for handling confidential information of this nature and in accordance
with safe and sound banking practices. Notwithstanding the foregoing, any Lender
may in any event may make disclosures of, and furnish copies of such information
(i) to another Lender; (ii) when reasonably required by any BONA FIDE transferee
or participant in connection with the contemplated transfer of any Loans or
Commitment or participation therein (PROVIDED that each such prospective
transferee and/or participant shall execute an agreement for the benefit of the
Borrower with such prospective transferor Lender and/or participant containing
provisions substantially identical to those contained in this section 12.15);
(iii) to its parent corporation or corporations, and to its and their auditors
and attorneys; and (iv) as required or requested by any governmental agency or
representative thereof or pursuant to legal process, PROVIDED that, unless
specifically prohibited by applicable law or court order, each Lender shall
notify the Borrower of any request by any governmental agency or representative
thereof (other than any such request in connection with an examination of the
financial condition of such Lender by such governmental agency) for disclosure
of any such non-public information prior to disclosure of such information. In
no event shall any Lender be obligated or required to return any materials
furnished by or on behalf of the Borrower or any of its Subsidiaries. The
Borrower hereby agrees that the failure of a Lender to comply with the
provisions of this section 12.15 shall not relieve the Borrower of any of the
obligations to such Lender under this Agreement and the other Credit Documents.
12.16. LENDER REGISTER. The Borrower hereby designates the
Administrative Agent to serve as its agent, solely for purposes of this section
12.16, to maintain a register (the "LENDER REGISTER") on or in which it will
record the names and addresses of the Lenders, and the Commitments from time to
time of each of the Lenders, the Loans made to the Borrower by each of the
Lenders and each repayment and prepayment in respect of the principal amount of
such Loans of each such Lender. Failure to make any such recordation, or (absent
manifest error) any error in such recordation, shall not affect the Borrower's
obligations in respect of such Loans. With respect to any Lender, the transfer
of the Commitment of such Lender and the rights to the principal of, and
interest on, any Loan made pursuant to such Commitment shall not be effective
until such transfer is recorded on the Lender Register maintained by the
Administrative Agent with respect to ownership of such Commitment and Loans and
prior to such recordation all amounts owing to the transferor with respect to
such Commitment and Loans shall remain owing to the transferor. The registration
of assignment or transfer of all or part of any Commitments and Loans shall be
recorded by the Administrative Agent on the Lender Register only upon the
acceptance by the Administrative Agent of a properly executed and delivered
Assignment Agreement pursuant to section 12.4(b). The Borrower agrees to
indemnify the Administrative Agent from and against any and all losses, claims,
damages and liabilities of whatsoever nature which may be imposed on, asserted
against or incurred by the Administrative Agent in performing its duties under
this section 12.16. The Lender Register shall be available for inspection by the
Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
12.17. LIMITATIONS ON LIABILITY OF THE LETTER OF CREDIT ISSUERS. The
Borrower assumes all risks of the acts or omissions of any beneficiary or
transferee of any Letter of Credit with respect to its use of such Letters of
Credit. Neither any Letter of Credit Issuer nor any of its officers or directors
shall be liable or responsible for: (a) the use which may be made of any Letter
of Credit or any acts or omissions of any beneficiary or transferee in
connection therewith; (b)
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the validity, sufficiency or genuineness of documents, or of any endorsement
thereon, even if such documents should prove to be in any or all respects
invalid, insufficient, fraudulent or forged; (c) payment by a Letter of Credit
Issuer against presentation of documents that do not comply with the terms of a
Letter of Credit, including failure of any documents to bear any reference or
adequate reference to such Letter of Credit; or (d) any other circumstances
whatsoever in making or failing to make payment under any Letter of Credit,
EXCEPT that the Borrower (or a Subsidiary which is the account party in respect
of the Letter of Credit in question) shall have a claim against a Letter of
Credit Issuer, and a Letter of Credit Issuer shall be liable to the Borrower (or
such Subsidiary), to the extent of any direct, but not consequential, damages
suffered by the Borrower (or such Subsidiary) which the Borrower (or such
Subsidiary) proves were caused by (i) such Letter of Credit Issuer's willful
misconduct or gross negligence in determining whether documents presented under
a Letter of Credit comply with the terms of such Letter of Credit or (ii) such
Letter of Credit Issuer's willful failure to make lawful payment under any
Letter of Credit after the presentation to it of documentation strictly
complying with the terms and conditions of such Letter of Credit. In furtherance
and not in limitation of the foregoing, a Letter of Credit Issuer may accept
documents that appear on their face to be in order, without responsibility for
further investigation.
12.18. GENERAL LIMITATION OF LIABILITY. No claim may be made by the
Borrower, any Lender, the Administrative Agent, any Letter of Credit Issuer or
any other person against the Administrative Agent, any Letter of Credit Issuer,
or any other Lender or the Affiliates, directors, officers, employees, attorneys
or agents of any of them for any damages other than actual compensatory damages
in respect of any claim for breach of contract or any other theory of liability
arising out of or related to the transactions contemplated by this Agreement or
any of the other Credit Documents, or any act, omission or event occurring in
connection therewith; and each of the Borrower, each Lender, the Administrative
Agent and each Letter of Credit Issuer hereby, to the fullest extent permitted
under applicable law, waives, releases and agrees not to ▇▇▇ or counterclaim
upon any such claim for any special, consequential or punitive damages, whether
or not accrued and whether or not known or suspected to exist in its favor.
12.19. NO DUTY. All attorneys, accountants, appraisers, consultants
and other professional persons (including the firms or other entities on behalf
of which any such person may act) retained by the Administrative Agent or any
Lender with respect to the transactions contemplated by the Credit Documents
shall have the right to act exclusively in the interest of the Administrative
Agent or such Lender, as the case may be, and shall have no duty of disclosure,
duty of loyalty, duty of care, or other duty or obligation of any type or nature
whatsoever to the Borrower, to any of its Subsidiaries, or to any other person,
with respect to any matters within the scope of such representation or related
to their activities in connection with such representation.
12.20. LENDERS AND AGENT NOT FIDUCIARY TO BORROWER, ETC. The
relationship among the Borrower and its Subsidiaries, on the one hand, and the
Administrative Agent, each Letter of Credit Issuer and the Lenders, on the other
hand, is solely that of debtor and creditor, and the Administrative Agent, each
Letter of Credit Issuer and the Lenders have no fiduciary or other special
relationship with the Borrower and its Subsidiaries, and no term or provision of
any Credit Document, no course of dealing, no written or oral communication, or
other action, shall be construed so as to deem such relationship to be other
than that of debtor and creditor.
12.21. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties herein shall survive the making of Loans and the
issuance of Letters of Credit hereunder, the execution and delivery of this
Agreement, the Notes and the other documents the forms of which are attached as
Exhibits hereto, the issue and delivery of the Notes, any disposition thereof by
any holder thereof, and any investigation made by the Administrative Agent or
any Lender or any other holder of any of the Notes or on its behalf. All
statements contained in any certificate or other document delivered to the
Administrative Agent or any Lender or any holder of any Notes by or on behalf of
the Borrower or of its Subsidiaries pursuant hereto or otherwise specifically
for use in connection with the transactions contemplated hereby shall constitute
representations and warranties by the Borrower hereunder, made as of the
respective dates specified therein or, if no date is specified, as of the
respective dates furnished to the Administrative Agent or any Lender.
[The balance of this page is intentionally blank.]
65
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Agreement to be duly executed and delivered as of the date first above
written.
HEALTHCARE RECOVERIES, INC.
BY: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
NAME: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
TITLE: Chief Financial Officer
NATIONAL CITY BANK OF KENTUCKY,
INDIVIDUALLY AS A LENDER,
A LETTER OF CREDIT ISSUER
AND AS ADMINISTRATIVE AGENT
BY: /s/ ▇▇▇ ▇▇▇▇
NAME: ▇▇▇ ▇▇▇▇
TITLE: Senior Vice President
BANK ONE, KENTUCKY, NATIONAL ASSOCIATION,
INDIVIDUALLY AS A LENDER AND
AS SYNDICATION AGENT
BY: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
NAME: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
TITLE: First Vice President
FIFTH THIRD BANK
BY: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
NAME: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
TITLE: ASSISTANT VICE PRESIDENT
ANNEX I
INFORMATION AS TO LENDERS
--------------------------------------------------------------------------------------------------------------------
NAME OF LENDER COMMITMENT DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
--------------------------------------------------------------------------------------------------------------------
National City Bank National City Bank of Kentucky National City Bank of Kentucky
of Kentucky COMMITMENT: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ Regional Division--8th Floor Louisville Regional
$18,000,000 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇--▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
CONTACTS/NOTIFICATION METHODS:
▇▇▇▇▇▇▇ ▇▇▇▇▇
Senior Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
CONTACT FOR BILLING INQUIRIES, & WIRES
AND PAYMENTS NOT RECEIVED, ETC.:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
CONTACT FOR RATES, ROLLOVER REQUESTS
AND LOANS:
▇▇▇▇▇ ▇▇▇▇▇▇
Money Desk Administrator
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
LETTER OF CREDIT NOTIFICATION:
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇. #▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
WIRING INFORMATION:
ABA # ▇▇▇-▇▇▇-▇▇▇
Agent Services Group
Account No. 151810
Ref.: Healthcare Recoveries, Inc.
International (Letter of Credit)
Division:
Account No.: 299300
Ref.: Healthcare Recoveries, Inc.
--------------------------------------------------------------------------------------------------------------------
BANK ONE, Bank One, Kentucky, N.A. Bank One, Kentucky, N.A.
KENTUCKY, N.A. COMMITMENT: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
$17,000,000
PRIMARY CONTACT:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
First Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
NAME OF LENDER COMMITMENT DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
--------------------------------------------------------------------------------------------------------------------
CONTACT FOR BORROWINGS, PAYMENTS, ETC.:
▇▇▇ ▇▇▇▇▇
Commercial Operations Senior Specialist
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
PAYMENT INSTRUCTIONS:
ABA #▇▇▇▇▇▇▇▇▇
Attention: Commercial Loan Operations
Account #034015101000551
Reference: Healthcare Recoveries, Inc.
SECONDARY CONTACT:
▇▇▇▇▇ ▇▇▇▇▇▇▇
Commercial Client Services Consultant
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
--------------------------------------------------------------------------------------------------------------------
FIFTH THIRD BANK, Fifth Third Bank, Kentucky, Inc. - 7th Fifth Third Bank, Kentucky, Inc. -
KENTUCKY, INC. COMMITMENT: Floor 7th Floor
▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
$5,000,000 ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
PRIMARY CONTACT:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Assistant Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
SECONDARY CONTACT:
▇▇▇▇ ▇▇▇▇▇▇▇
Vice President
Telephone:
Facsimile:
WIRING INFORMATION
ABA #▇▇▇▇▇▇▇▇▇
Attention: Commercial Loan Operations
Reference: Healthcare Recoveries
--------------------------------------------------------------------------------------------------------------------