EXHIBIT 10.37
SYNDICATION AMENDMENT AND ASSIGNMENT
THIS SYNDICATION AMENDMENT AND ASSIGNMENT (this "AMENDMENT"), dated as
of June 27, 2000 is by and among STERILE RECOVERIES, INC., a Florida corporation
(the "BORROWER"), certain Subsidiaries of the Borrower (each a "GUARANTOR", and
collectively, the "GUARANTORS"), THE PERSON IDENTIFIED AS THE "EXISTING LENDER"
ON THE SIGNATURE PAGES HERETO (the "EXISTING LENDER"), THE PERSONS IDENTIFIED AS
"NEW LENDERS" ON THE SIGNATURE PAGES HERETO (the "NEW LENDERS" and, together
with the Existing Lender, the "LENDERS") and FIRST UNION NATIONAL BANK, as Agent
for the Lenders (the "AGENT").
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement dated as of February 24, 1999
(the "EXISTING CREDIT AGREEMENT") among the Borrower, the Guarantors, the
Existing Lender and the Agent, the Existing Lender has extended commitments to
make certain credit facilities available to the Borrower; and
WHEREAS, the parties hereto have agreed to amend the Existing Credit
Agreement as set forth herein;
NOW, THEREFORE, in consideration of the agreements herein contained and
other good and valuable consideration, the parties hereby agree as follows:
PART I
DEFINITIONS
SUBPART 1.1. CERTAIN DEFINITIONS. Unless otherwise defined
herein or the context otherwise requires, the following terms used in
this Amendment, including its preamble and recitals, have the following
meanings:
"AMENDED CREDIT AGREEMENT" means the Existing Credit
Agreement as amended hereby.
"AMENDMENT EFFECTIVE DATE" shall have the meaning set
forth in SUBPART 4.1.
SUBPART 1.2. OTHER DEFINITIONS. Unless otherwise defined
herein or the context otherwise requires, terms used in this Amendment,
including its preamble and recitals, have the meanings provided in the
Amended Credit Agreement.
PART II
AMENDMENTS TO EXISTING CREDIT AGREEMENT
SUBPART 2.1. AMENDMENT TO EXISTING CREDIT AGREEMENT. Effective
on (and subject to the occurrence of) the Amendment Effective Date, the
Existing Credit Agreement (but not the SCHEDULES and EXHIBITS thereto)
is hereby amended as set forth in SCHEDULE A attached hereto. Except as
so amended, the Existing Credit Agreement shall continue in full force
and effect.
SUBPART 2.2. AMENDMENT TO SCHEDULE 1.1A. Effective on (and
subject to the occurrence of) the Amendment Effective Date, the
SCHEDULE 1.1A to the Existing Credit Agreement is hereby amended and
replaced with a new SCHEDULE 1.1A in the form attached as SCHEDULE 1.1A
hereto.
SUBPART 2.3. NEW EXHIBIT 2.11. A new Schedule 2.11 is hereby
added to the Existing Credit Agreement in the form attached as EXHIBIT
2.11 hereto.
PART III
ASSIGNMENTS AND ASSUMPTIONS
The Existing Lender hereby sells and assigns, without recourse, to the
New Lenders, and each New Lender hereby purchases and assumes, without recourse,
from the Existing Lender, effective as of the Amendment Effective Date, such
interests in the Existing Lender's rights and obligations under the Amended
Credit Agreement as shall be necessary in order to give effect to the
reallocations of the Commitments effected by the amendment to Schedule 1.1A to
the Existing Credit Agreement pursuant to PART II, including, without
limitation, the Loans, LOC Obligations and other extensions of credit owing to
the Existing Lender which are outstanding on the Amendment Effective Date,
together with unpaid interest accrued on the assigned Loans and other extensions
of credit to the Amendment Effective Date and the amount, if any, set forth
below of the Fees accrued to the Amendment Effective Date for the account of the
Existing Lender. Each of the Existing Lender and each New Lender hereby makes
and agrees to be bound by all the representations, warranties and agreements set
forth in Section 13.8(d) of the Amended Credit Agreement, a copy of which has
been received by each such party. From and after the Amendment Effective Date
(i) each New Lender shall be a party to and be bound by the provisions of the
Amended Credit Agreement and, to the extent of the interests assigned by this
Assignment and Acceptance, have the rights and obligations of a Lender
thereunder and (ii) the Existing Lender shall, to the extent of the interests
assigned by this Amendment, relinquish its rights (other than any rights it may
have pursuant to Section 13.9 of the Amended Credit Agreement which will
survive) and be released from its obligations under the Amended Credit
Agreement. The Existing Lender represents and warrants to each New Lender that
(i) it is the legal and beneficial owner of the interest being assigned hereby
free and clear of any adverse claim and (ii) it is legally authorized to enter
into this Amendment.
-2-
PART IV
CONDITIONS TO EFFECTIVENESS
SUBPART 4.1. AMENDMENT EFFECTIVE DATE. This Amendment shall be
and become effective when all of the conditions set forth in this PART
IV shall have been satisfied (the "AMENDMENT EFFECTIVE DATE"), and
thereafter this Amendment shall be known, and may be referred to, as
"SYNDICATION AMENDMENT AND ASSIGNMENT."
SUBPART 4.2. EXECUTION OF COUNTERPARTS OF AMENDMENT. The Agent
shall have received counterparts of this Amendment, which collectively
shall have been duly executed on behalf of each of the Borrower, the
Subsidiary Guarantors, the Agent and the Lenders.
SUBPART 4.3. EXECUTION AND DELIVERY OF NEW NOTES. Each Lender
shall have received new Notes duly executed on behalf of the Borrower.
SUBPART 4.4. CERTIFICATES OF SECRETARY OR ASSISTANT SECRETARY
OF THE CREDIT PARTIES. The Agent shall have received a certificate of
the secretary or an assistant secretary of each Credit Party certifying
(A) that attached thereto is a true and complete copy of the charter
documents of such Credit Party and all amendments thereto, certified as
of a recent date by the appropriate Governmental Authority in its
jurisdiction of formation; (B) that attached thereto is a true and
complete copy of the bylaws of such Credit Party, as in effect on the
date of such certification; (C) that attached thereto is a true and
complete copy of resolutions duly adopted by the Board of Directors of
such Credit Party authorizing the execution, delivery and performance
of this Agreement and the other Credit Documents to which it is a party
and (D) as to the incumbency and genuineness of the signature of each
officer of such Credit Party executing the Credit Documents and related
documents and certificates to which it is a party.
SUBPART 4.5. CERTIFICATES OF GOOD STANDING AND TAX CLEARANCE.
The Agent shall have received certificates as of a recent date of the
good standing of each Credit Party under the laws of its respective
jurisdiction of organization.
SUBPART 4.6. LEGAL OPINION. The Agent shall have received a
legal opinion in form and substance satisfactory to it dated as of the
Amendment Effective Date from counsel to the Credit Parties.
SUBPART 4.7. FINANCIAL STATEMENTS. The Agent shall have
received an opening pro forma balance sheet of the Borrower and its
Subsidiaries as of a recent date giving effect to this Amendment,
together with projected financial statements of the Borrower and its
Subsidiaries (consisting of balance sheets and statements of income and
cash flows) prepared on an annual basis through December 31, 2003, all
of which shall be in form and substance satisfactory to the Agent.
-3-
SUBPART 4.8. FEES AND EXPENSES. The Credit Parties shall have
paid all fees and expenses of the Agent and the Lenders in connection
with this Amendment and the extensions of credit hereunder.
PART V
MISCELLANEOUS
SUBPART 5.1. CROSS-REFERENCES. References in this Amendment to
any Part or Subpart are, unless otherwise specified, to such Part or
Subpart of this Amendment.
SUBPART 5.2. REFERENCES IN OTHER CREDIT DOCUMENTS. At such
time as this Amendment shall become effective pursuant to the terms of
SUBPART 4.1, all references in the Existing Credit Agreement to the
"Credit Agreement" and all references in the other Credit Documents to
the "Credit Agreement" shall be deemed to refer to the Amended Credit
Agreement.
SUBPART 5.3. REPRESENTATIONS AND WARRANTIES OF THE BORROWER.
The Borrower hereby represents and warrants that (a) the conditions
precedent to the initial Loans were satisfied as of the Closing Date,
(b) the representations and warranties contained in Section 6 of the
Existing Credit Agreement (as amended by this Amendment) are correct in
all material respects on and as of the date hereof as though made on
and as of such date and after giving effect to the amendments contained
herein and (c) no Default or Event of Default exists under the Existing
Credit Agreement on and as of the date hereof and after giving effect
to the amendments contained herein.
SUBPART 5.4. COUNTERPARTS. This Amendment may be executed by
the parties hereto in several counterparts, each of which shall be
deemed to be an original and all of which shall constitute together but
one and the same agreement.
SUBPART 5.5. GOVERNING LAW. THIS AMENDMENT SHALL BE DEEMED TO
BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE
OF FLORIDA WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES
THEREOF.
SUBPART 5.6. SUCCESSORS AND ASSIGNS. This Amendment shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns.
SUBPART 5.7. ASSIGNMENT PURSUANT TO THE CREDIT AGREEMENT.
Notwithstanding any provision in the Amended Credit Agreement to the
contrary, the execution of this Amendment shall constitute an
assignment for purposes of Section 13.8 of the Amended Credit
Agreement.
[The remainder of this page is intentionally left blank.]
-4-
Each of the parties hereto has caused a counterpart of this Amendment
to be duly executed and delivered as of the date first above written.
BORROWER: STERILE RECOVERIES, INC.,
a Florida corporation
By: /s/ D. ▇▇▇ ▇▇▇▇▇▇▇
----------------------------
Name: D. ▇▇▇ ▇▇▇▇▇▇▇
--------------------------
Title: Vice President
-------------------------
GUARANTOR: ▇▇▇▇▇ SURGICAL ENTERPRISES, INC.,
an Ohio corporation
By: /s/ D. ▇▇▇ ▇▇▇▇▇▇▇
----------------------------
Name: D. ▇▇▇ ▇▇▇▇▇▇▇
--------------------------
Title: Vice President
-------------------------
EXISTING LENDER: FIRST UNION NATIONAL BANK,
individually in its capacity as a Lender and in
its capacity as Agent
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
--------------------------
Title: SVP
-------------------------
NEW LENDERS: SOUTHTRUST BANK, N.A.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
--------------------------
Title: Vice President
-------------------------
SCHEDULE A
SCHEDULE 1.1A
LENDERS AND COMMITMENTS
REVOLVING REVOLVING SWINGLINE LOC
LENDER COMMITMENT COMMITMENT PERCENTAGE COMMITMENT COMMITTED AMOUNT
------ ---------- --------------------- ---------- ----------------
FIRST UNION NATIONAL BANK $15,000,000 50% $5,000,000 $375,000
(see address in Section 13.1)
SOUTHTRUST BANK $15,000,000 50% n/a $375,000
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Florida Corporate
Banking (Tampa)
Fax: ▇▇▇-▇▇▇-▇▇▇▇
With a copy to:
SouthTrust Bank
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
SCHEDULE A
--------------------------------------------------------------------------------
CREDIT AGREEMENT
DATED AS OF FEBRUARY 24, 1999,
AMONG
STERILE RECOVERIES, INC.
AS BORROWER,
CERTAIN SUBSIDIARIES OF THE BORROWER
AS GUARANTORS,
THE LENDERS FROM TIME TO TIME
PARTY HERETO,
AS LENDERS,
AND
FIRST UNION NATIONAL BANK,
AS AGENT
--------------------------------------------------------------------------------
8
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS.............................................................................................5
SECTION 1.1 DEFINITIONS............................................................................5
SECTION 1.2 ACCOUNTING TERMS AND DETERMINATIONS...................................................21
SECTION 1.3 OTHER DEFINITIONAL TERMS..............................................................21
ARTICLE II CREDIT FACILITY.......................................................................................21
SECTION 2.1 REVOLVING LOANS.......................................................................21
SECTION 2.2 PROCEDURE FOR ADVANCES OF REVOLVING LOANS.............................................22
SECTION 2.3 REPAYMENT OF REVOLVING LOANS..........................................................23
SECTION 2.4 REVOLVING NOTE........................................................................23
SECTION 2.5 SWINGLINE LOAN SUBFACILITY............................................................24
SECTION 2.6 PROCEDURE FOR ADVANCES OF SWINGLINE LOANS.............................................24
SECTION 2.7 REPAYMENT OF SWINGLINE LOANS..........................................................25
SECTION 2.8 SWINGLINE NOTE........................................................................26
SECTION 2.9 LETTER OF CREDIT SUBFACILITY..........................................................26
SECTION 2.10 PREPAYMENTS OF THE LOANS..............................................................30
SECTION 2.11 TERMINATION AND REDUCTION OF REVOLVING COMMITMENTS....................................31
SECTION 2.12 TERMINATION DATE......................................................................32
SECTION 2.13 USE OF PROCEEDS.......................................................................33
ARTICLE III GENERAL LOAN PROVISIONS..............................................................................33
SECTION 3.1 INTEREST..............................................................................33
SECTION 3.2 NOTICE AND MANNER OF CONVERSION OR CONTINUATION OF LOANS..............................35
SECTION 3.3 FEES..................................................................................35
SECTION 3.4 MANNER OF PAYMENT.....................................................................36
SECTION 3.5 CHANGED CIRCUMSTANCES.................................................................36
SECTION 3.6 INDEMNITY.............................................................................38
SECTION 3.7 CAPITAL REQUIREMENT...................................................................39
SECTION 3.8 TAXES.................................................................................39
SECTION 3.9 SHARING OF PAYMENTS...................................................................41
SECTION 3.10 PRO RATA TREATMENT....................................................................41
ARTICLE IV [RESERVED]...........................................................................................41
ARTICLE V CLOSING: CONDITIONS OF CLOSING AND BORROWING..........................................................41
SECTION 5.1 CONDITIONS TO CLOSING AND INITIAL LOANS...............................................41
SECTION 5.2 CONDITIONS TO ALL LOANS AND LETTERS OF CREDIT.........................................45
ARTICLE VI REPRESENTATIONS AND WARRANTIES OF THE BORROWER.......................................................45
SECTION 6.1 REPRESENTATIONS AND WARRANTIES........................................................45
SECTION 6.2 SURVIVAL OF REPRESENTATIONS AND WARRANTIES, ETC.......................................51
ARTICLE VII FINANCIAL INFORMATION AND NOTICES...................................................................51
SECTION 7.1 FINANCIAL STATEMENTS AND PROJECTIONS..................................................51
SECTION 7.2 OFFICER'S COMPLIANCE CERTIFICATE......................................................52
SECTION 7.3 NOTICE OF LITIGATION AND OTHER MATTERS................................................53
SECTION 7.4 ACCURACY OF INFORMATION...............................................................54
i
ARTICLE VIII AFFIRMATIVE COVENANTS..............................................................................54
SECTION 8.1 PRESERVATION OF CORPORATE EXISTENCE AND RELATED MATTERS...............................54
SECTION 8.2 MAINTENANCE OF PROPERTY...............................................................54
SECTION 8.3 INSURANCE.............................................................................54
SECTION 8.4 ACCOUNTING METHODS AND FINANCIAL RECORDS..............................................55
SECTION 8.5 PAYMENT AND PERFORMANCE OF OBLIGATIONS................................................55
SECTION 8.6 COMPLIANCE WITH LAWS, APPROVALS AND AGREEMENTS........................................55
SECTION 8.7 ENVIRONMENTAL MANAGEMENT..............................................................55
SECTION 8.8 COMPLIANCE WITH ERISA.................................................................56
SECTION 8.9 CONDUCT OF BUSINESS...................................................................56
SECTION 8.10 VISITS AND INSPECTIONS................................................................56
SECTION 8.11 [Reserved.]...........................................................................56
SECTION 8.12 MATERIAL CONTRACTS....................................................................57
SECTION 8.13 FURTHER ASSURANCES....................................................................57
SECTION 8.14 SECURITY INTERESTS....................................................................57
SECTION 8.15 ADDITIONAL GUARANTORS.................................................................57
ARTICLE IX FINANCIAL COVENANTS................................................................................58
SECTION 9.1 MINIMUM CONSOLIDATED NET WORTH........................................................58
SECTION 9.2 CONSOLIDATED LEVERAGE RATIO...........................................................58
SECTION 9.3 FIXED CHARGE COVERAGE RATIO...........................................................58
ARTICLE X NEGATIVE COVENANTS..................................................................................58
SECTION 10.1 LIMITATIONS ON DEBT...................................................................58
SECTION 10.2 LIMITATIONS ON LIENS..................................................................59
SECTION 10.3 LIMITATIONS ON LOANS, ADVANCES, INVESTMENTS AND ACQUISITIONS..........................60
SECTION 10.4 LIMITATIONS ON MERGERS AND LIQUIDATION................................................60
SECTION 10.5 LIMITATIONS ON SALE OF ASSETS.........................................................60
SECTION 10.6 TRANSACTIONS WITH AFFILIATES..........................................................61
SECTION 10.7 CERTAIN ACCOUNTING CHANGES............................................................61
SECTION 10.8 NO RESTRICTED PAYMENTS................................................................61
SECTION 10.9 [Intentionally Omitted]...............................................................61
SECTION 10.10 ADDITIONAL NEGATIVE PLEDGES...........................................................61
SECTION 10.11 SALE AND LEASEBACK....................................................................62
SECTION 10.12 LICENSES, ETC.........................................................................62
SECTION 10.13 LIMITATIONS...........................................................................62
SECTION 10.14 AMENDMENTS; PAYMENTS AND PREPAYMENTS OF SUBORDINATED DEBT.............................62
ARTICLE XI DEFAULT AND REMEDIES..............................................................................62
SECTION 11.1 EVENTS OF DEFAULT......................................................................62
SECTION 11.2 REMEDIES...............................................................................65
SECTION 11.3 RIGHTS AND REMEDIES CUMULATIVE; NON-WAIVER; ETC........................................65
SECTION 11.4 CREDITING OF PAYMENTS AND PROCEEDS.....................................................66
ARTICLE XII THE AGENT............................................................................................66
SECTION 12.1 APPOINTMENT OF AGENT....................................................................66
SECTION 12.2 NATURE OF DUTIES OF AGENT...............................................................67
SECTION 12.3 LACK OF RELIANCE ON AGENT...............................................................67
SECTION 12.4 CERTAIN RIGHTS OF THE AGENT.............................................................67
ii
SECTION 12.5 RELIANCE BY AGENT.......................................................................68
SECTION 12.6 INDEMNIFICATION OF AGENT................................................................68
SECTION 12.7 THE AGENT IN ITS INDIVIDUAL CAPACITY....................................................68
SECTION 12.8 HOLDERS OF NOTES........................................................................68
SECTION 12.9 SUCCESSOR AGENT.........................................................................69
SECTION 12.10 ACTIONS WITH RESPECT TO DEFAULTS........................................................69
SECTION 12.11 DELIVERY OF INFORMATION.................................................................69
ARTICLE XIII MISCELLANEOUS.......................................................................................70
SECTION 13.1 NOTICES.................................................................................70
SECTION 13.2 GOVERNING LAW...........................................................................71
SECTION 13.3 ARBITRATION; CONSENT TO JURISDICTION AND SERVICE OF PROCESS.............................71
SECTION 13.4 WAIVER OF JURY TRIAL....................................................................72
SECTION 13.5 REVERSAL OF PAYMENTS....................................................................72
SECTION 13.6 INJUNCTIVE RELIEF.......................................................................72
SECTION 13.7 [RESERVED]..............................................................................73
SECTION 13.8 SUCCESSORS AND ASSIGNS; PARTICIPATIONS..................................................73
SECTION 13.9 PAYMENT OF EXPENSES; INDEMNIFICATION....................................................75
SECTION 13.10 AMENDMENTS, WAIVERS AND CONSENTS........................................................76
SECTION 13.11 INFORMATION.............................................................................77
SECTION 13.12 PERFORMANCE OF DUTIES...................................................................77
SECTION 13.13 NONLIABILITY OF AGENT AND LENDERS.......................................................77
SECTION 13.14 ALL POWERS COUPLED WITH INTEREST........................................................78
SECTION 13.15 SURVIVAL OF INDEMNITIES.................................................................78
SECTION 13.16 TITLES AND CAPTIONS.....................................................................78
SECTION 13.17 SEVERABILITY OF PROVISIONS..............................................................78
SECTION 13.18 COUNTERPARTS............................................................................78
SECTION 13.19 TERM OF AGREEMENT.......................................................................78
ARTICLE XIV GUARANTY............................................................................................79
SECTION 14.1 THE GUARANTY............................................................................79
SECTION 14.2 BANKRUPTCY..............................................................................79
SECTION 14.3 NATURE OF LIABILITY.....................................................................80
SECTION 14.4 INDEPENDENT OBLIGATION..................................................................80
SECTION 14.5 AUTHORIZATION...........................................................................80
SECTION 14.6 RELIANCE................................................................................80
SECTION 14.7 WAIVER..................................................................................81
SECTION 14.8 LIMITATION ON ENFORCEMENT...............................................................82
SECTION 14.9 CONFIRMATION OF PAYMENT.................................................................82
iii
EXHIBITS
Exhibit A Form of Assignment and Acceptance
Exhibit B-1 Form of Revolving Note
Exhibit B-2 Form of Swingline Note
Exhibit C Form of Notice of Borrowing
Exhibit D Form of Notice of Conversion/Continuation
Exhibit E Form of Officer's Compliance Certificate
Exhibit F Form of Joinder Agreement
SCHEDULES
Schedule 1.1A Lenders and Commitments
Schedule 1.1B Sweep Plus Loan/Investment Services Description
Schedule 5.1 Corporate Structure
Schedule 6.1(p) Debt, Contingent Obligations and Liens
Schedule 6.1(w) Collateral Locations; Offices
Schedule 6.1(x) Fictitious Business Names
iv
CREDIT AGREEMENT
THIS CREDIT AGREEMENT (this "Credit Agreement", or this "Agreement"),
dated as of February 24, 1999, is by and among STERILE RECOVERIES, INC., a
Florida corporation (the "Borrower"), certain Subsidiaries of the Borrower from
time to time party hereto (the "Guarantors"), each of those financial
institutions identified as Lenders on SCHEDULE 1.1A hereto (together with each
of their successors and assigns, referred to individually as a "Lender and,
collectively, as the "Lenders"), and FIRST UNION NATIONAL BANK ("First Union"),
acting in the manner and to the extent described in ARTICLE XII hereof (in such
capacity, the "Agent").
STATEMENT OF PURPOSE
The Borrower has requested, and the Lenders have agreed, to extend a
revolving credit facility to the Borrower in the aggregate principal amount of
up to $30,000,000 on the terms and conditions of this Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, such parties
hereby agree as follows:
ARTICLE VI
DEFINITIONS
SECTION 6.1 DEFINITIONS.
The following terms when used in this Agreement shall have the meanings
assigned to them below:
"ADDITIONAL CREDIT PARTY" shall mean each Person that becomes a
Guarantor by execution of a Joinder Agreement in accordance with Section 8.15.
"ADJUSTED LIBOR RATE" means for any LIBOR Loan for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) determined by the Agent to be equal to the quotient obtained by
dividing (a) the LIBOR Rate for such LIBOR Loan for such Interest Period by (b)
a percentage equal to one hundred percent (100%) minus the Adjusted LIBOR Rate
Reserve Percentage for such LIBOR Loan for such Interest Period.
"ADJUSTED LIBOR RATE RESERVE PERCENTAGE" means, for the Interest Period
for each LIBOR Loan comprising part of the same borrowing (including
conversions, extensions and renewals), the percentage applicable two (2)
Business Days before the first day of such Interest Period under regulations
issued from time to time by the Board of Governors of the Federal Reserve System
(or any successor) for determining the maximum reserve requirement (including,
without limitation, any emergency, supplemental or other marginal reserve
requirement) for a
member bank of the Federal Reserve System in New York City with respect to
liabilities or assets consisting of or including "eurocurrency liabilities" (as
such term is used in Regulation D), or with respect to any other category of
liabilities which includes deposits by reference to which the interest rate on
LIBOR Loans is determined, having a term equal to the Interest Period for which
such Adjusted LIBOR Rate Reserve Percentage is determined.
"AFFILIATE" means, with respect to any Person, any other Person which
directly or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, such Person. The term "control"
means (a) the power to vote ten percent (10%) or more of the securities or other
equity interests of a Person having ordinary voting power, or (b) the
possession, directly or indirectly, of any other power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting securities, by contract or otherwise.
"AGENT" means First Union as provided in the preamble to this Credit
Agreement or any successor to First Union.
"AGENT'S OFFICE" means the office of Agent specified in or determined
in accordance with the provisions of Section 13.1.
"AGREEMENT" means this Credit Agreement, as amended or supplemented
from time to time.
"APPLICABLE LAW" means all applicable provisions of constitutions,
statutes, rules, regulations and orders of all Governmental Authorities and all
orders and decrees of all courts and arbitrators.
"APPLICABLE MARGIN" means for LIBOR Loans, LIBOR Market Index Swingline
Loans, Base Rate Loans and Letters of Credit, the appropriate applicable
percentages corresponding to the Consolidated Leverage Ratio in effect as of the
most recent Calculation Date as shown below:
------------ -------------------------- -------------------------------------------- ------------------ --------------------------
Tier Applicable Margin for LIBOR Loans, LIBOR Applicable Applicable
Levels Consolidated Leverage Market Index Swingline Loans and Letters Margin for Base Margin for
Ratio of Credit Rate Loans Commitment Fee
------------ -------------------------- -------------------------------------------- ------------------ --------------------------
I < 1.75 : 1.0 2.25% 1.00% 0.25%
-
------------ -------------------------- -------------------------------------------- ------------------ --------------------------
II > 1.75 : 1.0 < 2.5 : 1.0 2.50% 1.25% 0.25%
-
------------ -------------------------- -------------------------------------------- ------------------ --------------------------
III > 2.5 : 1.0 2.75% 1.50% 0.375%
------------ -------------------------- -------------------------------------------- ------------------ --------------------------
The Applicable Margin shall be determined and adjusted quarterly on the date
(each a "Calculation Date") five Business Days after the date on which the Agent
receives the quarterly officer's certificate provided by the Borrower in
accordance with the provisions of Section 7.2; PROVIDED, HOWEVER, that if the
Borrower fails to provide the officer's certificate to the Agent for
6
any fiscal quarter as required by and within the time limits set forth in
Section 7.2, the Applicable Margins from the applicable date of such failure
shall be based on Tier Level III until five Business Days after an appropriate
officer's certificate is provided, whereupon the Tier Level shall be determined
by the then current Consolidated Leverage Ratio. Except as set forth above, each
Applicable Margin shall be effective from one Calculation Date until the next
Calculation Date.
"ASSET DISPOSITION" means the disposition of any or all of the assets
(including without limitation the Capital Stock of a Subsidiary) of the Borrower
or any of its Subsidiaries whether by sale, lease, transfer or otherwise. The
term "Asset Disposition" shall not include (a) any Equity Issuance, (b) the sale
of inventory in the ordinary course of business or (c) the sale or other
disposition of assets no longer necessary in the business of the Borrower or any
Subsidiary of the Borrower so long as the net proceeds received from such sales
or other dispositions during the term of this Credit Agreement are not in excess
of $100,000.
"ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance entered
into by an assigning Lender and an assignee Lender, accepted by the Agent, in
accordance with Section 13.8, in the form attached hereto as EXHIBIT A.
"BASE RATE" means, for any day, the rate per annum equal to the higher
of (a) the Federal Funds Rate for such day plus one-half of one percent (0.5%)
and (b) the Prime Rate in effect on such day. If for any reason the Agent shall
have determined (which determination shall be conclusive absent manifest error)
that it is unable after due inquiry to ascertain the Federal Funds Rate for any
reason, including the inability or failure of the Agent to obtain sufficient
quotations in accordance with the terms hereof, the Base Rate shall be
determined without regard to clause (i) of the first sentence of this definition
until the circumstances giving rise to such inability no longer exist. Any
change in the Base Rate due to a change in the Prime Rate or the Federal Funds
Rate shall be effective on the effective date of such change in the Prime Rate
or Federal Funds Rate, respectively.
"BASE RATE LOAN" means any Loan bearing interest at a rate based upon
the Base Rate plus the Applicable Margin.
"BORROWER" means Sterile Recoveries, Inc., a Florida corporation, in
its capacity as borrower hereunder.
"BUSINESS DAY" means (a) for all purposes other than as set forth in
clause (b) below, any day other than a Saturday, Sunday or legal holiday on
which banks in Charlotte, North Carolina and New York, New York, are open for
the conduct of their commercial banking business and (b) with respect to all
notices and determinations in connection with, and payments of principal and
interest or any other amounts with respect to, any LIBOR Loan, any day that is a
Business Day described in clause (a) and that is also a day on which commercial
banks in London are open for international business (including dealings in
Dollar deposits in the London interbank market).
7
"CAPITAL ASSET" means, with respect to the Borrower and its
Subsidiaries, any asset that should, in accordance with GAAP, be classified and
accounted for as a capital asset on a consolidated balance sheet of the Borrower
and its Subsidiaries.
"CAPITAL LEASE" means, with respect to the Borrower and its
Subsidiaries, any lease of any property that should, in accordance with GAAP, be
classified and accounted for as a capital lease on a consolidated balance sheet
of the Borrower and its Subsidiaries.
"CAPITAL STOCK" means (i) in the case of a corporation, capital stock,
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
capital stock, (iii) in the case of a partnership, partnership interests
(whether general or limited), (iv) in the case of a limited liability company,
membership interests and (v) any other interest or participation that confers on
a Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
"CASH EQUIVALENTS" means, as to any Person, (i) securities issued or
directly and fully guaranteed or insured by the United States or any agency or
instrumentality thereof (PROVIDED that the full faith and credit of the United
States is pledged in support thereof) having maturities of not more than one
year from the date of acquisition, (ii) time deposits or certificates of deposit
of any commercial bank incorporated under the laws of the United States or any
state thereof, of recognized standing having capital and unimpaired surplus in
excess of $1,000,000,000 and whose short-term commercial paper rating at the
time of acquisition is at least A-1 or the equivalent thereof by Standard &
Poor's, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. ("S&P") ,or at least P-1
or the equivalent thereof by ▇▇▇▇▇'▇ Investors Service, Inc. (any such bank, an
"Approved Bank"), with such deposits or certificates having maturities of not
more than one year from the date of acquisition, (iii) repurchase obligations
with a term of not more than seven days for underlying securities of the types
described in clauses (i) and (ii) above entered into with any Approved Bank,
(iv) commercial paper or finance company paper issued by any Person incorporated
under the laws of the United States or any state thereof and rated at least A-1
or the equivalent thereof by S&P or at least P-1 or the equivalent thereof by
▇▇▇▇▇'▇ Investors Service, Inc., and in each case maturing not more than one
year after the date of acquisition, and (v) investments in money market funds
that are registered under the Investment Company Act of 1940, which have net
assets of at least $1,000,000,000 and at least 85% of whose assets consist of
securities and other obligations of the type described in clauses (i) through
(iv) above. All such Cash Equivalents must be denominated solely for payment in
Dollars.
"CHANGE IN CONTROL" means (a) any "person" or "group" of persons
(within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as
amended) other than ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇. shall have acquired beneficial ownership, directly or
indirectly, or shall have entered into a contract or arrangement that, upon
consummation, will result in its or their acquisition of, control over 20% or
more of the votes attributable to the voting stock of the Borrower; or (b)
individuals who at the beginning of any period of twenty-four (24) consecutive
calendar months were directors of the Borrower (together with any new directors
whose election by the board of directors of the Borrower or whose nomination for
election by the shareholders of the Borrower was approved by a vote of a least
8
two-thirds of the directors then still in office who either were directors at
the beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
board of directors of the Borrower then in office.
"CLOSING DATE" means the date of this Agreement.
"CODE" means the Internal Revenue Code of 1986, and the rules and
regulations thereunder, each as amended or supplemented from time to time.
"COLLATERAL" means, collectively, the Collateral as defined in the
Security Agreement and the Pledged Collateral as defined in the Pledge
Agreement.
"COLLATERAL AGENT" means First Union National Bank, in its capacity as
collateral agent for the Lenders and the ELLF Lenders under the Pledge Agreement
and the Security Agreement.
"COMMITMENT" means the Revolving Commitment, the LOC Commitment and the
Swingline Commitment.
"COMMITMENT FEE" means the fee required to be paid to the Agent for the
benefit of the Lenders at the end of each calendar quarter as partial
compensation for extending the Revolving Committed Amount to the Borrower,
calculated in accordance with Section 3.3(b).
"CONSOLIDATED" means, when used with reference to financial statements
or financial statement items of the Borrower and its Subsidiaries or any other
Person, such statements or items on a consolidated basis in accordance with
applicable principles of consolidation under GAAP.
"CONSOLIDATED EBITDA" means, with respect to the Borrower and its
Subsidiaries, for any period of determination, (a) Consolidated Net Income for
such period, PLUS (b) the sum of the following to the extent deducted in the
determination of Consolidated Net Income: (i) Consolidated Interest Expense,
(ii) income and franchise taxes, (iii) depreciation and amortization expense and
(iv) provision for reusable surgical product shrinkage not to exceed $750,000
during any fiscal quarter, in each case determined in accordance with GAAP for
such period.
"CONSOLIDATED INTEREST EXPENSE" means, for any period of determination,
the gross interest expense of the Borrower and its Subsidiaries (including any
amount attributable to interest in respect of payments under Capital Leases and
any net amount payable under any Hedging Agreement), all determined for such
period on a Consolidated basis in accordance with GAAP.
"CONSOLIDATED LEVERAGE RATIO" means, as of the last day of each fiscal
quarter of the Borrower, the ratio of Funded Debt of the Borrower and its
Subsidiaries (computed as of the last day of such fiscal quarter) to
Consolidated EBITDA (computed for the four fiscal quarter period then ending).
9
"CONSOLIDATED NET INCOME" means, for any period of determination with
respect to the Borrower and its Subsidiaries, net income on a consolidated basis
determined in accordance with GAAP applied on a consistent basis, but excluding
for purposes of determining the Consolidated Leverage Ratio and the Fixed Charge
Coverage Ratio, any extraordinary gains or losses and related tax effects
thereon. Except as expressly provided otherwise, the applicable period shall be
for the four consecutive quarters ending as of the date of determination.
"CONSOLIDATED NET WORTH" means, at any date of determination for the
Borrower and its Subsidiaries, shareholders' equity or net worth as determined
in accordance with GAAP.
"CONSOLIDATED RENTAL EXPENSE" means, for any period, rental expense
under Operating Leases of the Borrower and its Subsidiaries on a consolidated
basis for such period, as determined in accordance with GAAP.
"CONSOLIDATED SCHEDULED FUNDED DEBT PAYMENTS" means, as of the end of
each fiscal quarter of the Borrower and its Subsidiaries, for the Borrower and
its Subsidiaries on a consolidated basis, the sum of all scheduled payments of
principal on Funded Debt for the applicable period ending on such date
(including the principal component of payments due on Capital Leases during the
twelve month period ending on such date); it being understood that Scheduled
Funded Debt Payments shall not include voluntary prepayments or the mandatory
prepayments required pursuant to this Agreement.
"CONTINGENT OBLIGATION" means, at any date of determination, any
obligation, contingent or otherwise, of the Borrower or any of its Subsidiaries
pursuant to which such Person has directly or indirectly guaranteed any Debt or
other obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of any
such Person (a) to purchase or pay (or advance or supply funds for the purchase
or payment of) such Debt or other obligation (whether arising by virtue of
partnership arrangements, by agreement to keep well, to purchase assets, goods,
securities or services, to take-or-pay, or to maintain financial statement
condition or otherwise) or (b) entered into for the purpose of assuring in any
other manner the obligee of such Debt or other obligation of the payment thereof
or to protect such obligee against loss in respect thereof (in whole or in
part); PROVIDED, that the term Contingent Obligation shall not include
endorsements for collection or deposit in the ordinary course of business.
"CREDIT DOCUMENTS" means, collectively, this Agreement, the Notes, the
Letters of Credit, the LOC Documents, the Pledge Agreement, the Security
Agreement, each Joinder Agreement, any Hedging Agreement executed by a Lender
and each other document, instrument and agreement executed and delivered to a
Lender by any Credit Party in connection with this Agreement or otherwise
referred to herein or contemplated hereby, all as may be amended, modified or
otherwise supplemented from time to time.
"CREDIT PARTIES" means, collectively, the Borrower and the Guarantors.
10
"DEBT" means, with respect to any Person, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, or upon
which interest payments are customarily made, (c) all obligations of such Person
under conditional sale or other title retention agreements relating to property
purchased by such Person (other than customary reservations or retentions of
title under agreements with suppliers entered into in the ordinary course of
business), (d) all obligations of such Person issued or assumed as the deferred
purchase price of property or services purchased by such Person (other than
trade debt incurred in the ordinary course of business and due within six months
of the incurrence thereof) which would appear as liabilities on a balance sheet
of such Person, (e) all obligations of such Person under take-or-pay or similar
arrangements or under commodities agreements, (f) all Debt of others secured by
(or for which the holder of such Debt has an existing right, contingent or
otherwise, to be secured by) any Lien on, or payable out of the proceeds of
production from, property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed, (g) all Contingent Obligations of
any such Person, (h) the principal portion of all obligations of such Person
under Capital Leases, (i) all obligations of such Person under Hedging
Agreements, (j) the maximum amount of all standby letters of credit issued or
bankers' acceptances facilities created for the account of such Person and,
without duplication, all drafts drawn thereunder (to the extent unreimbursed),
(k) all preferred Capital Stock issued by such Person and required by the terms
thereof to be redeemed, or for which mandatory sinking fund payments are due,
prior to the Maturity Date, (l) the principal balance outstanding under any
synthetic lease, tax retention operating lease, off-balance sheet loan or
similar off-balance sheet financing product to which such Person is a party,
where such transaction is considered borrowed money indebtedness for tax
purposes but is classified as an operating lease in accordance with GAAP, and
(m) the Debt of any partnership or unincorporated joint venture in which such
Person is legally obligated or has a reasonable expectation of being liable with
respect thereto (excluding, for purposes hereof, the Debt of any such
partnership or unincorporated joint venture which is not majority-owned by such
Person as of the Closing Date until such time, if ever, that such entity becomes
majority-owned by such person).
"DEBT ISSUANCE" means the issuance of any Debt for borrowed money by
the Borrower or any of its Subsidiaries (other than Debt permitted by Section
10.1).
"DEFAULT" means any of the events specified in Section 11.1 which with
the passage of time, the giving of notice, or both, would constitute an Event of
Default.
"DEFAULT RATE" means the interest rate applicable to the Loans after
the occurrence and during the continuance of an Event of Default as described in
Section 3.1(c).
"DOLLARS" OR "$" means, unless otherwise qualified, dollars in lawful
currency of the United States.
"ELLF LENDERS" means the lenders, holders and other Financing Parties
from time to time party to the ELLF Participation Agreement.
11
"ELLF OPERATIVE AGREEMENTS" means the ELLF Participation Agreement and
each of the other "Operative Agreements" as such term in defined in Appendix A
to the ELLF Participation Agreement.
"ELLF PARTICIPATION AGREEMENT" means that certain Participation
Agreement dated as of the date hereof among the Borrower, as the construction
agent and the lessee, First Security Bank, National Association, as owner
trustee, the lenders identified therein as lenders and the lenders identified
therein as holders.
"EMPLOYEE BENEFIT PLAN" means any employee benefit plan within the
meaning of Section 3(3) of ERISA which (a) is maintained for employees of the
Borrower or any ERISA Affiliate or (b) has at any time within the preceding six
(6) years been maintained for the employees of the Borrower or any current or
former ERISA Affiliate.
"ENVIRONMENTAL LAWS" means any and all federal, state and local laws,
statutes, ordinances, rules, regulations, permits, licenses, approvals,
interpretations and orders of courts or Governmental Authorities, relating to
the protection of human health, natural resources or the environment, including,
but not limited to, requirements pertaining to the manufacture, processing,
distribution, use, treatment, storage, disposal, transportation, handling,
reporting, licensing, permitting, investigation, removal or remediation of
Hazardous Materials or liability resulting from the release or threatened
release of Hazardous Materials into the environment. Environmental Laws include,
without limitation, the Comprehensive Environmental Response, Compensation, and
Liability Act (42 U.S.C.ss.9601 ET SEQ.), the Hazardous Material Transportation
Act (33 U.S.C.ss.1251 ET SEQ.), the Resource Conservation and Recovery Act (42
U.S.C.ss.6901 ET SEQ.), the Federal Water Pollution Control Act (33 U.S.C.ss.201
ET SEQ.), the Clean Air Act (42 U.S.C.ss.7401 ET. SEQ.), the Toxicsubstances
control Act (15 U.S.C.ss.2601 ET SEQ.), the Safe Drinking Water Act (42
U.S.C.ss.300f ET SEQ.), the Federal Insecticide, Fungicide and Rodentizide Act
(7 U.S.C.ss.136 ET SEQ.), the Emergency Planning and Community Right-to-Know Act
(42 U.S.C.ss.11001 ET SEQ., as amended), the Environmental Protection Agency's
regulations relating to underground storage tanks (40 C.F.R. Parts 280 and 281),
and the Occupational Safety and Health Act (29 U.S.C.ss.651 ET SEQ.), analogous
state statutes and the rules and regulations promulgated under the foregoing, as
such statutes may be amended or supplemented from time to time as well as the
common law as it pertains to Hazardous Materials.
"EQUITY ISSUANCE" means any issuance by the Borrower or any of its
Subsidiaries to any Person which is not a Credit Party of (a) shares of its
Capital Stock, (b) any shares of its Capital Stock pursuant to the exercise of
options or warrants or (c) any shares of its Capital Stock pursuant to the
conversion of any debt securities to equity. The term "Equity Issuance" shall
not include any Asset Disposition.
"ERISA" means the Employee Retirement Income Security Act of 1974, and
the rules and regulations thereunder, each as amended or supplemented from time
to time.
12
"ERISA AFFILIATE" means any Person who together with the Borrower is
treated as a single employer within the meaning of Section 414(b), (c), (m) or
(o) of the Code or Section 4001(b) of ERISA.
"EVENT OF DEFAULT" means any of the events specified as an Event of
Default in Section 11.1.
"EXCLUDED ASSET DISPOSITION" means the sale, transfer, lease or other
disposition of assets described in clauses (a) and (b) of Section 10.5.
"EXISTING DEBT" means the aggregate loans in the amount of up to
$15,000,000 made by First Union to the Borrower under the Loan Agreement dated
as of October 15, 1996.
"FDIC" means the Federal Deposit Insurance Corporation, or any
successor thereto.
"FEDERAL FUNDS RATE" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) equal to the weighted average
of the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day; PROVIDED that (a) if such day is not a Business Day, the Federal Funds Rate
for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (b) if no
such rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average of the quotations for such day on
such transactions received by the Agent from three Federal Funds brokers of
recognized standing selected by it.
"FEES" means the Commitment Fee, the Letter of Credit Fee, the Issuing
Lender Fee and any other fees payable to the Agent or the Lenders pursuant to
the Credit Documents.
"FINANCING PARTIES" shall have the meaning assigned thereto in Appendix
A to the ELLF Participation Agreement.
"FISCAL YEAR" means the fiscal year of the Borrower and its
Subsidiaries ending on December 31.
"FIXED CHARGE COVERAGE RATIO" means, as of the end of each fiscal
quarter of the Borrower and its Subsidiaries for the twelve month period ending
on such date, the ratio of (a) the sum of (i) Consolidated EBITDA for the
applicable period PLUS (ii) Consolidated Rental Expense for the applicable
period to (b) the sum of (i) Consolidated Interest Expense for the applicable
period (but only to the extent paid in cash) PLUS (ii) Consolidated Scheduled
Funded Debt Payments for the applicable period PLUS (iii) Consolidated Rental
Expense for the applicable period PLUS (iv) income and franchise taxes for the
applicable period PLUS (v) dividends paid by the Borrower for the applicable
period.
"FOREIGN LENDER" shall have the meaning given to such term in Section
3.8(a).
13
"FUNDED DEBT" means, with respect to any Person, without duplication,
(i) all Debt of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, or upon
which interest payments are customarily made, (iii) all purchase money
Indebtedness (including for purposes hereof, indebtedness and obligations
described in clauses (c) and (d) of the definition of "Debt") of such Person,
including without limitation the principal portion of all obligations of such
Person under Capital Leases, (iv) all Contingent Obligations of such Person with
respect to Funded Debt of another Person, (v) the maximum available amount of
all standby letters of credit or acceptances issued or created for the account
of such Person, (vi) all Funded Debt of another Person secured by a Lien on any
Property of such Person, whether or not such Funded Debt has been assumed,
PROVIDED that for purposes hereof the amount of such Funded Debt shall be
limited to the greater of (A) the amount of such Funded Debt as to which there
is recourse to such Person and (B) the fair market value of the property which
is subject to the Lien, (vii) the outstanding attributed principal amount under
any securitization transaction, and (viii) the principal balance outstanding
under any synthetic lease, tax retention operating lease, off-balance sheet loan
or similar off-balance sheet financing product to which such Person is a party,
where such transaction is considered borrowed money indebtedness for tax
purposes but is classified as an operating lease in accordance with GAAP
(including, without limitation, the principal portion of all obligations due and
owing under the ELLF Operative Agreements. The Funded Debt of any Person shall
include the Funded Debt of any partnership or joint venture in which such Person
is a general partner or joint venturer, but only to the extent to which there is
recourse to such Person for the payment of such Funded Debt.
"GAAP" means generally accepted accounting principles, as recognized by
the American Institute of Certified Public Accountants and the Financial
Accounting Standards Board, maintained an a consistent basis for the Borrower
and its Subsidiaries throughout the period indicated and consistent with the
prior financial practice of the Borrower and its Subsidiaries.
"GOVERNMENTAL APPROVALS" means all authorizations, consents, approvals,
licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.
"GOVERNMENTAL AUTHORITY" means any nation, province, state or political
subdivision thereof, and any government or any Person exercising executive,
legislative, regulatory or administrative functions of or pertaining to
government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.
"GUARANTOR" shall mean any of the Subsidiaries of the Borrower
identified as a "Guarantor" on the signature pages hereto and the Additional
Credit Parties which execute a Joinder Agreement, together with their successors
and permitted assigns.
"GUARANTY" shall mean the guaranty given by the Guarantors pursuant to
Article XIV.
"HAZARDOUS MATERIALS" means any substances or materials (a) which are
or become defined as hazardous wastes, hazardous substances, pollutants,
contaminants, chemical substances or mixtures or toxic substances under any
Environmental Law, (b) which are toxic,
14
explosive, corrosive, flammable, infectious, radioactive, carcinogenic,
mutagenic or otherwise harmful to human health, natural resources or the
environment and are or become regulated by any Governmental Authority, (c) the
presence of which require investigation, removal or remediation under any
Environmental Law or common law, (d) the discharge or emission or release of
which requires a permit or license under any Environmental Law or other
Governmental Approval, (e) which constitute a nuisance, a trespass or pose a
health or safety hazard to persons, plants, animals or neighboring properties
either currently or in the past or in the future, (f) which contain, without
limitation, asbestos, polychlorinated biphenyls, urea formaldehyde foam
insulation, petroleum hydrocarbons, petroleum derived substances or waste, crude
oil nuclear fuel, natural gas or synthetic gas, or (g) which are materials
described in clauses (a) through (f) above and are contained in or intended for
containment in underground or aboveground storage tanks, whether empty, filled
or partially filled with any such substances.
"HEDGING AGREEMENT" means any agreement with respect to an interest
rate swap, collar, cap, floor or a forward rate agreement or other agreement
regarding the hedging of interest rate risk exposure executed in connection with
hedging the interest rate exposure of the Borrower or any of its Subsidiaries
under any agreement executed in connection with any Debt, and any confirming
letter executed pursuant to such hedging agreement, all as amended or
supplemented from time to time.
"INTEREST PERIOD" has the meaning assigned thereto in Section 3.1(b).
"ISSUING LENDER" shall mean First Union National Bank.
"ISSUING LENDER FEES" shall have the meaning set forth in Section
3.3(d).
"JOINDER AGREEMENT" shall mean a Joinder Agreement substantially in the
form of Exhibit F, executed and delivered by an Additional Credit Party in
accordance with the provisions of Section 8.14.
"LENDERS" shall have the meaning given such term in the introductory
paragraph of this Agreement.
"LETTERS OF CREDIT" shall mean any letter of credit issued by the
Issuing Lender for the account of the Borrower pursuant to the terms hereof, as
such Letters of Credit may be amended, modified, extended, renewed or replaced
from time to time.
"LETTER OF CREDIT FEE" shall have the meaning set forth in Section
3.3(c).
"LIBOR LOAN" means any Revolving Loan bearing interest at a rate based
upon the Adjusted LIBOR Rate plus the Applicable Margin.
"LIBOR MARKET INDEX SWINGLINE LOAN" means any Swingline Loan bearing
interest at a rate based upon the LIBOR Market Index Rate plus the Applicable
Margin.
15
"LIBOR MARKET INDEX RATE" means for any day, the rate for one month
Dollar deposits as reported on Telerate page 3750 as of 11:00 a.m., London time,
on such day, or if such day is not a Business Day, then the immediately
preceding Business Day (or if not so reported then as determined by the
Swingline Lender from another recognized source or interbank quotation).
"LIBOR RATE" means, for any LIBOR Loan for any Interest Period
therefor, the rate per annum appearing on Telerate Page 3750 (or any successor
page) as the London interbank offered rate for deposits in Dollars at
approximately 11:00 a.m. (London time) two (2) Business Days prior to the first
day of such Interest Period for a term comparable to such Interest Period. If
for any reason such rate is not available, the term "LIBOR Rate" shall mean, for
any LIBOR Loan for any Interest Period therefor, the rate per annum appearing on
Reuters Screen LIBO Page as the London interbank offered rate for deposits in
Dollars at approximately 11:00 a.m. (London time) two (2) Business Days prior to
the first day of such Interest Period for a term comparable to such Interest
Period; PROVIDED, HOWEVER, if more than one (1) rate is specified on Reuters
Screen LIBO Page, the applicable rate shall be the arithmetic mean of all such
rates.
"LIEN" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset.
For the purposes of this Agreement, a Person's assets shall be deemed to be
subject to a Lien if such Person has acquired or holds such assets subject to
the interest of a vendor or lessor under any conditional sale agreement, Capital
Lease or other title retention agreement relating to such asset.
"LOAN" means any Revolving Loan or any Swingline Loan (including any
LIBOR Market Index Swingline Loan) made to the Borrower hereunder.
"LOC COMMITMENT" shall mean the commitment of the Issuing Lender to
issue Letters of Credit and with respect to each Lender, the commitment of such
Lender to purchase participation interests in the Letters of Credit up to such
Lender's LOC Committed Amount as specified in SCHEDULE 1.1 A.
"LOC COMMITMENT PERCENTAGE" shall mean, for each Lender, the percentage
identified as its LOC Commitment Percentage on SCHEDULE 1.1A, as such percentage
may be modified in connection with any assignment made in accordance with the
provisions of Section 13.8.
"LOC COMMITTED AMOUNT" shall mean, collectively, the aggregate amount
of all of the LOC Commitments of the Lenders to issue and participate in Letters
of Credit as referenced in Section 2.9 in an amount up to $750,000 and,
individually, the amount of each Lender's LOC Commitment as specified in
SCHEDULE 1.1A.
"LOC DOCUMENTS" shall mean, with respect to any Letter of Credit, such
Letter of Credit, any amendments thereto, any documents delivered in connection
therewith, any application therefor, and any agreements, instruments, guarantees
or other documents (whether general in application or applicable only to such
Letter of Credit) governing or providing for (i) the rights and obligations of
the parties concerned or (ii) any collateral security for such obligations.
16
"LOC OBLIGATIONS" shall mean, at any time, the sum of (i) the maximum
amount which is, or at any time thereafter may become, available to be drawn
under Letters of Credit then outstanding, assuming compliance with all
requirements for drawings referred to in such Letters of Credit PLUS (ii) the
aggregate amount of all drawings under Letters of Credit honored by the Issuing
Lender but not theretofore reimbursed.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (i) the
properties, business, operations, condition (financial or otherwise) liabilities
or capitalization of the Borrower and its Subsidiaries, taken as a whole, (ii)
the ability of any Credit Party to pay and perform its obligations under this
Agreement or any other Credit Document executed in connection herewith or any
credit agreement executed in replacement hereof, or (iii) the validity or
enforceability of any such Credit Documents or the rights and remedies of the
Lender thereunder, in each case as determined by the Agent in its reasonable
discretion.
"MATERIAL CONTRACT" means any contract or other arrangement (other than
the Credit Documents), whether written or oral, to which the Borrower or any of
its Subsidiaries is a party as to which the breach, nonperformance, cancellation
or failure to renew by any party thereto could have a Material Adverse Effect.
"MATURITY DATE" means June 30, 2003
"MULTIEMPLOYER PLAN" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate is making, or
is accruing an obligation to make, contributions within the preceding six (6)
years.
"NET CASH PROCEEDS" means the aggregate cash proceeds received by the
Borrower and its Subsidiaries in respect of any Asset Disposition, Equity
Issuance or Debt Issuance, net of (a) direct costs (including, without
limitation, legal, accounting and investment banking fees, and sales
commissions) and (b) taxes paid or payable as a result thereof; it being
understood that "Net Cash Proceeds" shall include, without limitation, any cash
received upon the sale or other disposition of any non-cash consideration
received by the Borrower and its Subsidiaries in any Asset Disposition, Equity
Issuance or Debt Issuance.
"NOTES" means the Revolving Notes and the Swingline Note.
"NOTICE OF BORROWING" has the meaning assigned thereto in Section
2.2(a) and Section 2.6(a).
"NOTICE OF CONVERSION/CONTINUATION" has the meaning assigned thereto in
Section 3.2.
"OBLIGATIONS" means the Loans, any other loans and advances or
extensions of credit made or to be made by any Lender to the Borrower pursuant
to this Credit Agreement, together with interest thereon (including interest
which would be payable as post-petition interest in connection with any
bankruptcy or similar proceeding), the LOC Obligations and all indebtedness,
fees, liabilities and obligations which may at any time be owing by the Borrower
to
17
any Lender (including the Issuing Lender) in each case pursuant to this Credit
Agreement or any other Credit Document, whether now in existence or incurred by
the Borrower from time to time hereafter, whether unsecured or secured by
pledge, Lien upon or security interest in any of the Credit Parties' assets or
property or the assets or property of any other Person, whether such
indebtedness is absolute or contingent, joint or several, matured or unmatured,
direct or indirect and whether the Borrower is liable to such Lender for such
indebtedness as principal, surety, endorser, guarantor or otherwise. Obligations
shall also include any other indebtedness owing to any Lender by the Borrower
under this Credit Agreement and the other Credit Documents, the Borrower's
liability to any Lender pursuant to this Credit Agreement as maker or endorser
of any promissory note or other instrument for the payment of money, the
Borrower's liability to any Lender pursuant to this Credit Agreement or any
other Credit Document under any instrument of guaranty or indemnity, or arising
under any guaranty, endorsement or undertaking which any Lender may make or
issue to others for the Borrower's account pursuant to this Credit Agreement,
and all liabilities and obligations owing from the Borrower to any Lender, or
any affiliate of a Lender, arising under Hedging Agreements entered into for the
purpose of hedging interest rate risk under this Credit Agreement and the other
Credit Documents.
"OFFICER'S COMPLIANCE CERTIFICATE" has the meaning assigned thereto in
Section 7.2.
"OPERATING LEASE" means, as applied to any Person, any lease
(including, without limitation, leases which may be terminated by the lessee at
any time) of any property (whether real, personal or mixed) which is not a
Capital Lease other than any such lease in which that Person is the lessor.
"OTHER TAXES" has the meaning assigned thereto in Section 3.8(c).
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
agency.
"PENSION PLAN" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to the provisions of Title IV of ERISA or
Section 412 of the Code and which (a) is maintained for employees of the
Borrower or any ERISA Affiliates or (b) has at any time within the preceding six
(6) years been maintained for the employees of the Borrower or any of its
current or former ERISA Affiliates.
"PERMITTED LIENS" has the meaning assigned thereto in Section 10.2.
"PERSON" means an individual, corporation, partnership, limited
liability company, association, trust, business trust, joint venture, joint
stock company, pool, syndicate, sole proprietorship, unincorporated
organization, Governmental Authority or any other form of entity or group
thereof specifically listed herein.
"PLEDGE AGREEMENT" means the Pledge Agreement dated as of the date
hereof entered into by the Credit Parties in favor of the Collateral Agent, as
amended, modified or otherwise supplemented from time to time.
18
"PRIME RATE" means, at any time, the rate of interest per annum
publicly announced from time to time by the Agent as its prime rate in effect at
its principal office in Charlotte, North Carolina. The parties hereto
acknowledge that the rate so announced by the Agent as its Prime Rate is an
index or base rate and shall not necessarily be the lowest or best rate charged
to its customers or other banks.
"PURCHASE MONEY DEBT" means any Debt incurred by a Person for all or
any part of the deferred purchase price of property or services acquired by such
Person (including obligations in respect of Capital Leases).
"REGULATION D" means Regulation D of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"REPORTABLE EVENT" means any reportable event as defined in Section
4043 of ERISA or the regulations issued thereunder with respect to an Employee
Benefit Plan.
"REQUIRED LENDERS" means, at any time, Lenders which are then in
compliance with their obligations hereunder (as determined by the Agent) and
holding in the aggregate at least 51% of (i) the Revolving Commitments (and
participation interests therein) or (ii) if the Commitments have been
terminated, the outstanding Loans, LOC Obligations and participation interests.
"RESTRICTED PAYMENT" means (a) any cash dividend or other cash
distribution, direct or indirect, on account of any ownership interest or shares
of any class of Capital Stock of the Borrower or any of its Subsidiaries, as the
case may be, now or hereafter outstanding, (b) any redemption, retirement,
sinking fund or similar payment, purchase or other acquisition for value, direct
or indirect, of any ownership interest or shares of any class of Capital Stock
of the Borrower or any of its Subsidiaries now or hereafter outstanding by the
Borrower or any of its Subsidiaries, as the case may be, except for any
redemption, retirement, sinking funds or similar payment payable solely in such
shares of that class of stock or in any class of stock junior to that class, (c)
any cash payment made to redeem, purchase, repurchase or retire, or to obtain
the surrender of, any outstanding warrants, options or other rights to acquire
any ownership interest or shares of any class of Capital Stock of the Borrower
or any of its Subsidiaries now or hereafter outstanding, or (d) any payment to
any Affiliate of the Borrower except to the extent expressly permitted in this
Agreement.
"REVOLVING COMMITMENT" means, with respect to each Lender, the
commitment of such Lender in an aggregate principal amount at any time
outstanding of up to such Lender's Revolving Commitment Percentage of the
Revolving Committed Amount to make Revolving Loans in accordance with the
provisions of Section 2.1.
"REVOLVING COMMITMENT PERCENTAGE" means, for any Lender, the percentage
identified as its Revolving Commitment Percentage on SCHEDULE 1.1A, as such
percentage may be modified in connection with any assignment made in accordance
with the provisions of Section 13.8.
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"REVOLVING COMMITTED AMOUNT" means the aggregate revolving credit line
extended by the Lenders to the Borrower for Revolving Loans pursuant to and in
accordance with the terms of this Credit Agreement, in an amount up to
$30,000,000, as such revolving credit line may be increased or reduced from time
to time in accordance with Sections 2.11.
"REVOLVING LOANS" means the revolving credit loans made by the Lender
to the Borrower pursuant to Section 2.1.
"REVOLVING NOTES" means the promissory notes of the Borrower in favor
of each of the Lenders evidencing the Revolving Loans provided pursuant to
Section 2.1, individually or collectively, as appropriate, as such promissory
notes may be amended, modified, restated, supplemented, extended, renewed or
replaced from time to time.
"SECURITY AGREEMENT" means the Security Agreement dated as of the date
hereof entered into by the Credit Parties in favor of the Collateral Agent, as
amended, modified or otherwise supplemented from time to time.
"SOLVENT" means, as to the Borrower and its Subsidiaries at any date of
determination, that the Borrower and its Subsidiaries, taken as a whole, (a)
have capital sufficient to carry on their business and transactions and all
business and transactions in which they engage and are able to pay their debts
as they mature, (b) own property having a value, both at fair valuation and at
present fair saleable value, greater than the amount required to pay their
probable liabilities (including contingencies) and (c) do not have debts or
liabilities beyond their ability to pay such debts or liabilities as they
mature.
"SUBSIDIARY" means as to any Person, any other Person of which more
than fifty percent (50%) of the outstanding capital stock or other ownership
interests having ordinary voting power to elect a majority of the board of
directors or other managers of such other Person is at the time, directly or
indirectly, owned by or the management is otherwise controlled by such first
Person (irrespective of whether, at the time, capital stock or other ownership
interests of such other Person shall have or might have voting power by reason
of the happening of any contingency).
"SWEEP PLUS ARRANGEMENT" means the Sweep Plus Loan/Investment Services
Description attached hereto as SCHEDULE 1.1B or any similar arrangement between
the Borrower and the Swingline Lender by which Swingline Loans may be advanced
and deposited from time to time into a specified account with the Swingline
Lender and which deposits may be applied to repay the Swingline Loans
outstanding hereunder.
"SWINGLINE COMMITMENT" means the commitment of the Swingline Lender to
make Swingline Loans in an aggregate principal amount at any time outstanding up
to the Swingline Committed Amount and the commitment of the Lenders to purchase
participation interests in the Swingline Loans up to their respective Revolving
Commitment Percentage as provided in Section 2.7(b), as such amounts may be
reduced from time to time in accordance with the provisions hereof.
"SWINGLINE COMMITTED AMOUNT" means $5,000,000.
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"SWINGLINE LENDER" means First Union National Bank.
"SWINGLINE LOAN" means a swingline revolving loan made by the Swingline
Lender pursuant to the provisions of Section 2.5.
"TAXES" shall have the meaning assigned thereto in Section 3.8(a).
"TERMINATION DATE" means the earliest of the dates referred to in
Section 2.12.
"UNUSED REVOLVING COMMITTED AMOUNT" means, for any period, the amount
by which (a) the then applicable Revolving Committed Amount exceeds (b) the
daily average for such period of the outstanding aggregate principal amount of
all Revolving Loans.
"WHOLLY-OWNED" means, with respect to a Subsidiary, a Subsidiary in
which all of the shares of Capital Stock are owned or controlled, directly or
indirectly, by the Borrower and/or one or more of its Wholly-Owned Subsidiaries.
SECTION 6.2 ACCOUNTING TERMS AND DETERMINATIONS
Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis. All calculations made for the purposes of determining compliance with
this Credit Agreement shall (except as otherwise expressly provided herein) be
made by application of GAAP applied on a basis consistent with the most recent
annual or quarterly financial statements delivered pursuant to Section 7.1;
PROVIDED, HOWEVER, if (a) the Borrower shall object to determining such
compliance on such basis at the time of delivery of such financial statements
due to any change in GAAP or the rules promulgated with respect thereto or (b)
the Agent or the Required Lenders shall so object in writing within 60 days
after delivery of such financial statements, then such calculations shall be
made on a basis consistent with the most recent financial statements delivered
by the Borrower to the Lenders as to which no such objection shall have been
made.
SECTION 6.3 OTHER DEFINITIONAL TERMS.
Terms not otherwise defined herein which are defined in the Uniform
Commercial Code as in effect in the State of Florida (the "Code") shall have the
meanings given them in the Code. All capitalized terms defined in this Credit
Agreement shall have the defined meanings when used in this Credit Agreement,
the Notes and the other Credit Documents or any certificate, report or other
document made or delivered pursuant to this Credit Agreement. Unless otherwise
specified, references to any times herein shall refer to Eastern Standard time
or, if then in effect, Eastern Daylight time.
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ARTICLE VII
CREDIT FACILITY
SECTION 7.1 REVOLVING LOANS.
(a) Subject to the terms and conditions of this Agreement and in
reliance upon the representations and warranties set forth herein, each Lender
agrees to make Revolving Loans to the Borrower from time to time from the
Closing Date through but not including the Termination Date as requested by the
Borrower in accordance with the terms of Section 2.2; PROVIDED, that the sum of
the aggregate principal amount of all outstanding Revolving Loans (after giving
effect to any amount requested) plus the aggregate principal amount of all
outstanding Swingline Loans plus outstanding LOC Obligations shall not exceed
the Revolving Committed Amount then in effect. Subject to the terms and
conditions hereof, the Borrower may borrow, repay and reborrow Revolving Loans
hereunder until the Termination Date.
(b) No Lender shall be obligated at any time to make available to the
Borrower its Revolving Commitment Percentage of any requested Revolving Loan if
such amount plus its Revolving Commitment Percentage of all Revolving Loans plus
its LOC Commitment Percentage of LOC Obligations then outstanding would exceed
such Lender's Revolving Commitment at such time. The aggregate balance of
Revolving Loans outstanding shall not at any time exceed the Revolving Committed
Amount.
SECTION 7.2 PROCEDURE FOR ADVANCES OF REVOLVING LOANS.
(a) REQUESTS FOR BORROWING.
(i) Each request for borrowings hereunder shall be made by notice in
the form attached hereto as EXHIBIT C from the Borrower to the Agent
(the "Notice of Borrowing"), given not later than 11:00 a.m. (A) on the
Business Day on which the proposed borrowing is requested to be made
for Revolving Loans that will be Base Rate Loans and (B) three Business
Days prior to the date of the requested borrowing of Revolving Loans
that will be LIBOR Loans; PROVIDED, HOWEVER, that no LIBOR Loans shall
be available to the Borrower until the third Business Day after the
Closing Date. Each Notice of Borrowing shall be given by either
telecopy, telex or cable setting forth (1) the requested date of such
borrowing, (2) the aggregate amount of such requested borrowing, (3)
whether such Revolving Loans will be Base Rate Loans or LIBOR Loans,
and if appropriate, the applicable Interest Period and (4)
certification by the Borrower that it has complied in all respects with
ARTICLE V, all of which shall be specified in such manner as is
necessary to comply with all limitations on Revolving Loans outstanding
hereunder. Each Notice of Borrowing shall be irrevocable by and binding
on the Borrower. Each Loan shall be in a minimum principal amount of
$500,000 and integral multiples of $250,000 in excess thereof (or the
remaining amount of the Revolving Committed Amount, if less); PROVIDED
that no more than 5 LIBOR Loans shall be outstanding hereunder at any
one time. Revolving Loans may be repaid and reborrowed in accordance
with the provisions hereof.
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The Agent shall give to each Lender prompt notice (but in no
event later than 1:30 P.M. on the date of the Agent's receipt of notice
from the Borrower) of each Notice of Borrowing by telecopy, telex or
cable (other than any Notice of Borrowing which will be funded by the
Agent in accordance with subsection (d)(ii) below). No later than 3:00
P.M. on the date on which a borrowing is requested to be made pursuant
to the applicable Notice of Borrowing, each Lender will make available
to the Agent at the address of the Agent set forth in Section 13.1, in
immediately available funds, its Revolving Commitment Percentage of
such borrowing requested to be made. Unless the 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 Agent its portion of the
borrowing to be made on such date, the Agent may assume that such
Lender will make such amount available to the Agent on such date of
borrowing and the Agent may, in reliance upon such assumption, make
available the amount of the borrowing to be provided by such Lender.
Upon fulfillment of the conditions set forth in ARTICLE V for such
borrowing, the Agent will make such funds available to the Borrower at
the account specified by the Borrower in such Notice of Borrowing.
(ii) If the amounts described in subsection (a)(i) of this
Section 2.2 are not in fact made available to the Agent by a Lender
(such Lender being hereinafter referred to as a "Defaulting Lender")
and the Agent has made such amount available to the Borrower, the Agent
shall be entitled to recover such corresponding amount on demand from
such Defaulting Lender. If such Defaulting Lender does not pay such
corresponding amount forthwith upon the Agent's demand therefor, the
Agent shall promptly notify the Borrower and the Borrower shall
immediately (but in no event later than five Business Days after such
demand) pay such corresponding amount to the Agent. The Agent shall
also be entitled to recover from such Defaulting Lender and the
Borrower, (A) interest on such corresponding amount in respect of each
day from the date such corresponding amount was made available by the
Agent to the Borrower to the date such corresponding amount is
recovered by the Agent, at a rate per annum equal to either (1) if paid
by such Defaulting Lender, the overnight Federal Funds Rate or (2) if
paid by the Borrower, the then applicable rate of interest, calculated
in accordance with Section 3.1, PLUS (B) in each case, an amount equal
to any costs (including legal expenses) and losses incurred as a result
of the failure of such Defaulting Lender to provide such amount as
provided in this Credit Agreement. Nothing herein shall be deemed to
relieve any Lender from its obligation to fulfill its commitments
hereunder or to prejudice any rights which the Borrower may have
against any Lender as a result of any default by such Lender hereunder,
including, without limitation, the right of the Borrower to seek
reimbursement from any Defaulting Lender for any amounts paid by the
Borrower under clause (B) above on account of such Defaulting Lender's
default.
(iii) The failure of any Lender to make the Revolving Loan to
be made by it as part of any borrowing shall not relieve any other
Lender of its obligation, if any, hereunder to make its Revolving Loan
on the date of such borrowing, but no Lender shall be responsible for
the failure of any other Lender to make the Revolving Loan to be made
by such other Lender on the date of any borrowing.
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(iv) Each Lender shall be entitled to earn interest at the
then applicable rate of interest, calculated in accordance with ARTICLE
III, on outstanding Revolving Loans which it has funded to the Agent
from the date such Lender funded such Revolving Loan to, but excluding,
the date on which such Lender is repaid with respect to such Revolving
Loan.
SECTION 7.3 REPAYMENT OF REVOLVING LOANS.
The Borrower shall repay the outstanding principal amount of all
Revolving Loans on the Termination Date, if not sooner repaid, together with (i)
all accrued but unpaid interest thereon to but not including the date of
repayment, and (ii) all other amounts due under the Credit Documents.
SECTION 7.4 REVOLVING NOTE.
The Revolving Loans and the obligation of the Borrower to repay such
Revolving Loans, together with interest and all other fees, charges and other
amounts due thereon or in connection therewith, shall be evidenced by the
Revolving Note which shall be substantially in the form attached as EXHIBIT B-1.
SECTION 7.5 SWINGLINE LOAN SUBFACILITY.
(a) Subject to the terms and conditions of this Agreement and in
reliance upon the representations and warranties set forth herein, the Swingline
Lender agrees to make Swingline Loans to the Borrower from time to time from the
Closing Date through but not including the Termination Date as requested by the
Borrower in accordance with the terms of Section 2.6; PROVIDED, that (i) the
aggregate principal amount of all outstanding Swingline Loans (after giving
effect to any amount requested) shall not exceed the Swingline Committed Amount
and (ii) the aggregate principal amount of all outstanding Revolving Loans plus
the aggregate principal amount of all outstanding Swingline Loans (after giving
effect to any amount requested) plus outstanding LOC Obligations shall not
exceed the Revolving Committed Amount then in effect. Subject to the terms and
conditions hereof, the Borrower may borrow, repay and reborrow Swingline Loans
hereunder until the Termination Date.
(b) The Swingline Lender shall not be obligated at any time to make
available to the Borrower any Swingline Loan if the amount of such Loan plus the
outstanding amount of all Revolving Loans advanced by such Lender plus such
Lender's LOC Commitment Percentage of LOC Obligations would exceed such Lender's
Revolving Commitment at such time. The aggregate balance of Swingline Loans
outstanding shall not at any time exceed the Swingline Committed Amount.
SECTION 7.6 PROCEDURE FOR ADVANCES OF SWINGLINE LOANS.
(a) Except as set forth in subsection (b) below, each request for
borrowings hereunder shall be made by notice in the form attached hereto as
EXHIBIT C from the Borrower to the Agent
24
(the "Notice of Borrowing"), given not later than 11:00 a.m. on the Business Day
on which the proposed borrowing is requested to be made. Each Notice of
Borrowing shall be given by either telecopy, telex or cable setting forth (1)
the requested date of such borrowing, (2) the aggregate amount of such requested
borrowing, (3) whether such Swingline Loans will be Base Rate Loans or LIBOR
Market Index Swingline Loans and (4) certification by the Borrower that it has
complied in all respects with ARTICLE V, all of which shall be specified in such
manner as is necessary to comply with all limitations on Swingline Loans
outstanding hereunder. Each Notice of Borrowing shall be irrevocable by and
binding on the Borrower. Each Swingline Loan requested pursuant to this
subsection (a) shall be in a minimum principal amount of $50,000 and integral
multiples of $50,000 in excess thereof (or the remaining amount of the Revolving
Committed Amount, if less). Swingline Loans may be repaid and reborrowed in
accordance with the provisions hereof.
(b) Borrowings of Swingline Loans hereunder may be made from time to
time into a specified demand deposit account with the Swingline Lender pursuant
to the Sweep Plus Arrangement. Each such borrowing shall be deemed a
reaffirmation by the Borrower that the representations and warranties set forth
in ARTICLE VI are true and correct in all material respects as of the date of
such borrowing. Unless otherwise specified to the Swingline Lender by the
Borrower in writing, all Swingline Loans made pursuant to this subsection (b)
shall consist of LIBOR Market Index Swingline Loans. Each Swingline Loan
requested pursuant to this subsection (b) shall be in such minimum amounts, if
any, provided in the Sweep Plus Arrangement.
SECTION 7.7 REPAYMENT OF SWINGLINE LOANS.
(a) Unless repaid sooner in accordance with the Sweep Plus Arrangement,
the principal amount of all Swingline Loans shall be due and payable in full on
the earlier of (i) the maturity date agreed to by the Swingline Lender and the
Borrower with respect to such Loan (which maturity date shall not be a date more
than 30 Business Days from the date of advance thereof) or (ii) the Termination
Date. The Borrower shall repay the outstanding principal amount of all Swingline
Loans on the Termination Date, if not sooner repaid, together with (i) all
accrued but unpaid interest thereon to but not including the date of repayment,
and (ii) all other amounts due under the Credit Documents.
(b) The Swingline Lender may, at any time, in its sole discretion, by
written notice to the Borrower and the Lenders, demand repayment of its
Swingline Loans by way of a Revolving Loan advance, in which case the Borrower
shall be deemed to have requested a Revolving Loan advance comprised solely of
Base Rate Loans in the amount of such Swingline Loans; PROVIDED, HOWEVER, that
any such demand shall be deemed to have been given one Business Day prior to the
Termination Date and on the date of the occurrence of any Event of Default
described in Section 11.1 and upon acceleration of the indebtedness hereunder
and the exercise of remedies in accordance with the provisions of Section 11.2.
Each Lender hereby irrevocably agrees to make its pro rata share of each such
Revolving Loan in the amount, in the manner and on the date specified in the
preceding sentence NOTWITHSTANDING (I) the amount of such borrowing may not
comply with the minimum amount for advances of Revolving Loans otherwise
required hereunder, (II) whether
25
any conditions specified in Section 5.2 are then satisfied, (III) whether a
Default or an Event of Default then exists, (IV) failure of any such request or
deemed request for Revolving Loan to be made by the time otherwise required
hereunder, (V) whether the date of such borrowing is a date on which Revolving
Loans are otherwise permitted to be made hereunder or (VI) any termination of
the Commitments relating thereto immediately prior to or contemporaneously with
such borrowing. In the event that any Revolving Loan cannot for any reason be
made on the date otherwise required above (including, without limitation, as a
result of the commencement of a proceeding under the U.S. Bankruptcy Code with
respect to the Borrower or any other Credit Party), then each Lender hereby
agrees that it shall forthwith purchase (as of the date such borrowing would
otherwise have occurred, but adjusted for any payments received from the
Borrower on or after such date and prior to such purchase) from the Swingline
Lender such participation interests in the outstanding Swingline Loans as shall
be necessary to cause each such Lender to share in such Swingline Loans ratably
based upon its Revolving Commitment Percentage of the Revolving Committed Amount
(determined before giving effect to any termination of the Commitments pursuant
to Section 2.11), PROVIDED that (A) all interest payable on the Swingline Loans
shall be for the account of the Swingline Lender until the date as of which the
respective participation interest is funded and (B) at the time any purchase of
participation interests pursuant to this sentence is actually made, the
purchasing Lender shall be required to pay to the Swingline Lender, to the
extent not paid to the Swingline Lender by the Borrower in accordance with the
terms of Section 3.1(d), interest on the principal amount of participation
interests purchased for each day from and including the day upon which such
borrowing would otherwise have occurred to but excluding the date of payment for
such participation interests, at the rate equal to the Federal Funds Rate.
SECTION 7.8 SWINGLINE NOTE.
The Swingline Loans and the obligation of the Borrower to repay such
Swingline Loans, together with interest and all other fees, charges and other
amounts due thereon or in connection therewith, shall be evidenced by the
Swingline Note which shall be substantially in the form attached as EXHIBIT B-2.
SECTION 7.9 LETTER OF CREDIT SUBFACILITY.
(a) ISSUANCE. Subject to the terms and conditions hereof and
of the LOC Documents, if any, and any other terms and conditions which
the Issuing Lender may reasonably require, from [June __, 2000] through
but not including the Termination Date, the Issuing Lender shall issue,
and the Lenders shall participate in, Letters of Credit for the account
of the Borrower from time to time upon request in a form acceptable to
the Issuing Lender; PROVIDED, HOWEVER, that (i) the aggregate amount of
LOC Obligations shall not at any time exceed the LOC Committed Amount,
(ii) the sum of the aggregate amount of Revolving Loans PLUS Swingline
Loans PLUS LOC Obligations shall not at any time exceed the aggregate
Revolving Committed Amount then in effect, (iii) all Letters of Credit
shall be denominated in Dollars and (iv) Letters of Credit shall be
issued for the purpose of supporting tax-advantaged variable rate
demand note financing and for other lawful corporate purposes and may
be issued as standby letters of credit, including in connection with
workers' compensation and other insurance programs, and trade letters
26
of credit. Except as otherwise expressly agreed upon by all the
Lenders, no Letter of Credit shall have an original expiry date more
than twelve (12) months from the date of issuance; PROVIDED, HOWEVER,
that no Letter of Credit, as originally issued or as extended, shall
have an expiry date extending beyond the Termination Date. Each Letter
of Credit shall comply with the related LOC Documents. The issuance and
expiry date of each Letter of Credit shall be a Business Day. Any
Letters of Credit issued hereunder shall be in a minimum original face
amount of $100,000.
(b) NOTICE AND REPORTS. The request for the issuance of a
Letter of Credit shall be submitted to the Issuing Lender at least
three (3) Business Days prior to the requested date of issuance. The
Issuing Lender will promptly upon request provide to the Agent for
dissemination to the Lenders a detailed report specifying the Letters
of Credit which are then issued and outstanding and any activity with
respect thereto which may have occurred since the date of any prior
report, and including therein, among other things, the account party,
the beneficiary, the face amount, expiry date as well as any payments
or expirations which may have occurred. The Issuing Lender will further
provide to the Agent promptly upon request copies of the Letters of
Credit. The Issuing Lender will provide to the Agent promptly upon
request a summary report of the nature and extent of LOC Obligations
then outstanding.
(c) PARTICIPATIONS. Each Lender upon issuance of a Letter of
Credit shall be deemed to have purchased without recourse a risk
participation from the Issuing Lender in such Letter of Credit and the
obligations arising thereunder and any collateral relating thereto, in
each case in an amount equal to its LOC Commitment Percentage of the
obligations under such Letter of Credit and shall absolutely,
unconditionally and irrevocably assume, as primary obligor and not as
surety, and be obligated to pay to the Issuing Lender therefor and
discharge when due, its LOC Commitment Percentage of the obligations
arising under such Letter of Credit. Without limiting the scope and
nature of each Lender's participation in any Letter of Credit, to the
extent that the Issuing Lender has not been reimbursed as required
hereunder or under any LOC Document, each such Lender shall pay to the
Issuing Lender its LOC Commitment Percentage of such unreimbursed
drawing in same day funds on the day of notification by the Issuing
Lender of an unreimbursed drawing pursuant to the provisions of
subsection (d) hereof. The obligation of each Lender to so reimburse
the Issuing Lender shall be absolute and unconditional and shall not be
affected by the occurrence of a Default, an Event of Default or any
other occurrence or event. Any such reimbursement shall not relieve or
otherwise impair the obligation of the Borrower to reimburse the
Issuing Lender under any Letter of Credit, together with interest as
hereinafter provided. Each Existing Letter of Credit shall be deemed
for all purposes of this Agreement and the other Credit Documents to be
a Letter of Credit.
(d) REIMBURSEMENT. In the event of any drawing under any
Letter of Credit, the Issuing Lender will promptly notify the Borrower
and the Agent. The Borrower shall reimburse the Issuing Lender on the
day of drawing under any Letter of Credit (either with the proceeds of
a Swingline Loan or Revolving Loan obtained hereunder or
27
otherwise) in same day funds as provided herein or in the LOC
Documents. If the Borrower shall fail to reimburse the Issuing Lender
as provided herein, the unreimbursed amount of such drawing shall bear
interest at the Default Rate. Unless the Borrower shall immediately
notify the Issuing Lender and the Agent of its intent to otherwise
reimburse the Issuing Lender, the Borrower shall be deemed to have
requested a Revolving Loan in the amount of the drawing as provided in
subsection (e) hereof, the proceeds of which will be used to satisfy
the reimbursement obligations. The Borrower's reimbursement obligations
hereunder shall be absolute and unconditional under all circumstances
irrespective of any rights of set-off, counterclaim or defense to
payment the Borrower may claim or have against the Issuing Lender, the
Agent, the Lenders, the beneficiary of the Letter of Credit drawn upon
or any other Person, including without limitation any defense based on
any failure of the Borrower to receive consideration or the legality,
validity, regularity or unenforceability of the Letter of Credit. The
Issuing Lender will promptly notify the other Lenders of the amount of
any unreimbursed drawing and each Lender shall promptly pay to the
Agent for the account of the Issuing Lender in Dollars and in
immediately available funds, the amount of such Lender's LOC Commitment
Percentage of such unreimbursed drawing. Such payment shall be made on
the day such notice is received by such Lender from the Issuing Lender
if such notice is received at or before 2:00 P.M. (Charlotte, North
Carolina time), otherwise such payment shall be made at or before 12:00
Noon (Charlotte, North Carolina time) on the Business Day next
succeeding the day such notice is received. If such Lender does not pay
such amount to the Issuing Lender in full upon such request, such
Lender shall, on demand, pay to the Agent for the account of the
Issuing Lender interest on the unpaid amount during the period from the
date of such drawing until such Lender pays such amount to the Issuing
Lender in full at a rate per annum equal to, if paid within two (2)
Business Days of the date of drawing, the Federal Funds Rate and
thereafter at a rate equal to the Base Rate PLUS the Applicable Margin.
Each Lender's obligation to make such payment to the Issuing Lender,
and the right of the Issuing Lender to receive the same, shall be
absolute and unconditional, shall not be affected by any circumstance
whatsoever and without regard to the termination of this Agreement or
the Commitments hereunder, the existence of a Default or Event of
Default or the acceleration of the Obligations hereunder and shall be
made without any offset, abatement, withholding or reduction
whatsoever.
(e) REPAYMENT WITH REVOLVING LOANS. On any day on which the
Borrower shall have requested, or been deemed to have requested a
Revolving Loan to reimburse a drawing under a Letter of Credit, the
Agent shall give notice to the Lenders that a Revolving Loan has been
requested or deemed requested in connection with a drawing under a
Letter of Credit, in which case a Revolving Loan borrowing comprised
entirely of Base Rate Loans (each such borrowing, a "MANDATORY
BORROWING") shall be immediately made (without giving effect to any
termination of the Commitments pursuant to Section 11.2) PRO RATA based
on each Lender's respective Revolving Commitment Percentage (determined
before giving effect to any termination of the Commitments pursuant to
Section 11.2) and in the case of both clauses (i) and (ii) the proceeds
thereof shall be paid directly to the Issuing Lender for application to
the respective LOC Obligations. Each Lender hereby irrevocably agrees
to make such Revolving Loans immediately upon any
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such request or deemed request on account of each Mandatory Borrowing
in the amount and in the manner specified in the preceding sentence and
on the same such date NOTWITHSTANDING (i) the amount of Mandatory
Borrowing may not comply with the minimum amount for borrowings of
Revolving Loans otherwise required hereunder, (ii) whether any
conditions specified in Section 5.2 are then satisfied, (iii) whether a
Default or an Event of Default then exists, (iv) failure for any such
request or deemed request for Revolving Loan to be made by the time
otherwise required in Section 2.2(a)(i), (v) the date of such Mandatory
Borrowing, or (vi) any reduction in the Revolving Committed Amount
after any such Letter of Credit may have been drawn upon; PROVIDED,
HOWEVER, that in the event any such Mandatory Borrowing should be less
than the minimum amount for borrowings of Revolving Loans otherwise
provided in Section 2.2(a)(i), the Borrower shall pay to the Agent for
its own account an administrative fee of $500. In the event that any
Mandatory Borrowing cannot for any reason be made on the date otherwise
required above (including, without limitation, as a result of the
commencement of a proceeding under federal bankruptcy laws with respect
to the Borrower), then each such Lender hereby agrees that it shall
forthwith fund (as of the date the Mandatory Borrowing would otherwise
have occurred, but adjusted for any payments received from the Borrower
on or after such date and prior to such purchase) its participation
interests in the outstanding LOC Obligations; PROVIDED, FURTHER, that
in the event any Lender shall fail to fund its Participation Interest
on the day the Mandatory Borrowing would otherwise have occurred, then
the amount of such Lender's unfunded participation interest therein
shall bear interest payable to the Issuing Lender upon demand, at the
rate equal to, if paid within two (2) Business Days of such date, the
Federal Funds Rate, and thereafter at a rate equal to the Base Rate
PLUS the Applicable Margin.
(f) MODIFICATION, EXTENSION. The issuance of any supplement,
modification, amendment, renewal, or extension to any Letter of Credit
shall, for purposes hereof, be treated in all respects the same as the
issuance of a new Letter of Credit hereunder.
(g) UNIFORM CUSTOMS AND PRACTICES. The Issuing Lender shall
have the Letters of Credit be subject to The Uniform Customs and
Practice for Documentary Credits (the "UCP") or the International
Standby Practices 1998 (the "ISP98"), in either case as published as of
the date of issue by the International Chamber of Commerce, in which
case the UCP or the ISP98, as applicable, may be incorporated therein
and deemed in all respects to be a part thereof.
(h) The Borrower hereby agrees to protect, indemnify, pay and
save the Issuing Lender harmless from and against any and all claims,
demands, liabilities, damages, losses, costs, charges and expenses
(including reasonable attorneys' fees) that the Issuing Lender may
incur or be subject to as a consequence, direct or indirect, of (i) the
issuance of any Letter of Credit or (ii) the failure of the Issuing
Lender to honor a drawing under a Letter of Credit as a result of any
act or omission, whether rightful or wrongful, of any present or future
de jure or de facto government or governmental authority (all such acts
or omissions, herein called "GOVERNMENT Acts").
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(i) As between the Borrower and the Issuing Lender, the
Borrower shall assume all risks of the acts, omissions or misuse of any
Letter of Credit by the beneficiary thereof. The Issuing Lender shall
not be responsible: (i) for the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in
connection with the application for and issuance of any Letter of
Credit, even if it should in fact prove to be in any or all respects
invalid, insufficient, inaccurate, fraudulent or forged; (ii) for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, that may
prove to be invalid or ineffective for any reason; (iii) for failure of
the beneficiary of a Letter of Credit to comply fully with conditions
required in order to draw upon a Letter of Credit; (iv) for errors,
omissions, interruptions or delays in transmission or delivery of any
messages, by mail, cable, telegraph, telex or otherwise, whether or not
they be in cipher; (v) for errors in interpretation of technical terms;
(vi) for any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under a Letter of Credit
or of the proceeds thereof; and (vii) for any consequences arising from
causes beyond the control of the Issuing Lender, including, without
limitation, any Government Acts. None of the above shall affect,
impair, or prevent the vesting of the Issuing Lender's rights or powers
hereunder.
(j) In furtherance and extension and not in limitation of the
specific provisions hereinabove set forth, any action taken or omitted
by the Issuing Lender, under or in connection with any Letter of Credit
or the related certificates, if taken or omitted in good faith (except
in the case of gross negligence or willful misconduct), shall not put
such Issuing Lender under any resulting liability to the Borrower. It
is the intention of the parties that this Agreement shall be construed
and applied to protect and indemnify the Issuing Lender against any and
all risks involved in the issuance of the Letters of Credit, all of
which risks are hereby assumed by the Borrower (except for the gross
negligence or willful misconduct of the Issuing Lender), including,
without limitation, any and all risks of the acts or omissions, whether
rightful or wrongful, of any Government Authority. The Issuing Lender
shall not, in any way, be liable for any failure by the Issuing Lender
or anyone else to pay any drawing under any Letter of Credit as a
result of any Government Acts or any other cause beyond the control of
the Issuing Lender.
(k) Nothing in this Section 2.9 is intended to limit the
reimbursement obligation of the Borrower contained in Section 2.9(d)
hereof. The obligations of the Borrower under this Section 2.9 shall
survive the termination of this Agreement. No act or omissions of any
current or prior beneficiary of a Letter of Credit shall in any way
affect or impair the rights of the Issuing Lender to enforce any right,
power or benefit under this Agreement.
(l) Notwithstanding anything to the contrary contained in this
Section 2.9, the Borrower shall have no obligation to indemnify any
Issuing Lender in respect of any liability incurred by such Issuing
Lender arising out of the gross negligence or willful
30
misconduct of the Issuing Lender (including action not taken by an
Issuing Lender), as determined by a court of competent jurisdiction.
SECTION 7.10 PREPAYMENTS OF THE LOANS.
(a) VOLUNTARY PREPAYMENTS. The Loans may be prepaid in whole or in
part without premium or penalty, except as provided in Section 3.6. Each
prepayment of Revolving Loans shall be in a minimum principal amount of
$500,000, and in integral multiples of $250,000. Each prepayment of Swingline
Loans shall be in a minimum principal amount of $100,000, and integral multiples
of $50,000, PROVIDED that in the case of Swingline Loans made pursuant to the
Sweep Plus Arrangement, prepayments shall be in such minimum amounts, if any,
provided by the Sweep Plus Arrangement.
(b) MANDATORY PREPAYMENTS.
(i) If at any time the sum of the aggregate principal
amount of outstanding Revolving Loans outstanding PLUS the
aggregate principal amount of outstanding Swingline Loans
outstanding PLUS outstanding LOC Obligations shall exceed the
Revolving Committed Amount, the Borrower shall immediately
prepay the outstanding principal balance on the Revolving
Loans and (after all Revolving Loans have been repaid) cash
collateralize the LOC Obligations, in an amount sufficient to
eliminate such excess.
(ii) If at any time the sum of the aggregate
principal amount of outstanding Swingline Loans outstanding
shall exceed the Swingline Committed Amount, the Borrower
shall immediately prepay the outstanding principal balance on
the Swingline Loans in an amount sufficient to eliminate such
excess.
(iii) ASSET DISPOSITIONS. Immediately upon the
occurrence of any Asset Disposition, the Borrower shall prepay
the Revolving Loans in an aggregate amount equal to the Net
Cash Proceeds of such Asset Disposition (such prepayment to be
applied as set forth in clause (vi) below).
(iv) DEBT ISSUANCES. Immediately upon receipt by the
Borrower or any of its Subsidiaries of proceeds from any Debt
Issuance, the Borrower shall prepay the Revolving Loans in an
aggregate amount equal to 100% of the Net Cash Proceeds of
such Debt Issuance to the Lenders (such prepayment to be
applied as set forth in clause (vi) below).
(v) ISSUANCES OF EQUITY. Immediately upon receipt by
the Borrower or any of its Subsidiaries of proceeds from any
Equity Issuance, the Borrower shall prepay the Revolving Loans
in an aggregate amount equal to 100% of the Net Cash Proceeds
of such Equity Issuance to the Lenders (such prepayment to be
applied as set forth in clause (vi) below).
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(vi) APPLICATION OF MANDATORY PREPAYMENTS.
Prepayments with respect to Revolving Loans shall be applied
first to Base Rate Loans and then to LIBOR Loans in direct
order of Interest Period maturities and (after all Revolving
Loans have been repaid) cash collateralize the LOC
Obligations. Prepayments with respect to Swingline Loans shall
be applied first to Base Rate Loans and then to Swingline
Loans bearing interest at the LIBOR Market Index Rate. All
prepayments under this Section 2.9(b) shall be subject to
Section 3.6.
SECTION 7.11 TERMINATION AND REDUCTION OF REVOLVING COMMITMENTS.
(a) VOLUNTARY REDUCTIONS. The Revolving Commitments may be
terminated or permanently reduced in whole or in part by the Borrower
upon five (5) Business Days' prior written notice to the Agent,
PROVIDED that (i) after giving effect to any voluntary reduction, the
sum of the aggregate amount of outstanding Loans plus outstanding LOC
Obligations shall not exceed the aggregate Revolving Committed Amount,
as reduced, and (ii) partial reductions shall be in a minimum principal
amount of $2,500,000, and in integral multiples thereof. The Agent
shall promptly notify each affected Lender of receipt by the Agent of
any notice from the Borrower pursuant to this Section.
(b) GENERAL. The Borrower shall pay to the Agent for the
account of the Lenders in accordance with the terms of Section 3.3(b),
on the date of each termination or reduction of the Revolving Committed
Amount, the Commitment Fee accrued through the date of such termination
or reduction on the amount of the Revolving Committed Amount so
terminated or reduced.
(c) INCREASE OF REVOLVING COMMITTED AMOUNT.
The Borrower shall have the right upon at least
fifteen (15) Business Days' prior written notice to the Agent to
increase the Revolving Committed Amount by up to $15,000,000, in a
single increase, at any time on or after [June __, 2000] but prior to
December 29, 2000, SUBJECT, HOWEVER, in any such case, to satisfaction
of the following conditions precedent:
(i) no Default or Event of Default has occurred and
is continuing on the date on which such Revolving Committed
Amount increase is to become effective;
(ii) the representations and warranties set forth in
Article VI of this Credit Agreement shall be true and correct
in all material respects on and as of the date on which such
Revolving Committed Amount increase is to become effective;
(iii) on or before the date on which such Revolving
Committed Amount increase is to become effective, the Agent
shall have received, for its own account, the mutually
acceptable fees and expenses required by separate
32
agreement of the Borrower and the Agent to be paid in
connection with such increase;
(iv) such Revolving Committed Amount increase shall
be an integral multiple of $1,000,000 and shall in no event
be less than $5,000,000; and
(v) such requested Revolving Committed Amount
increase shall be effective on such date only to the extent
that, on or before such date, (A) the Agent shall have
received and accepted a corresponding amount of additional
Commitment(s) pursuant to a commitment letter(s) acceptable to
the Agent from one or more Lenders acceptable to the Agent
and, with respect to any Lender that is not at such time a
Lender hereunder, the Borrower and (B) each such Lender has
executed an agreement in the form of EXHIBIT 2.11 hereto,
accepted in writing therein by the Agent and, with respect to
any Lender that is not at such time a Lender hereunder, the
Borrower.
SECTION 7.12 TERMINATION DATE.
The Revolving Commitment shall terminate on the earliest of (i) the
Maturity Date, (ii) the date of permanent reduction of the Revolving Commitment
in whole by the Borrower pursuant to Section 2.11, and (iii) the date of
termination by the Agent at the request of the Required Lenders pursuant to
Section 11.2(a) (the "Termination Date").
SECTION 7.13 USE OF PROCEEDS.
The Borrower shall use the proceeds of the Loans for working capital,
capital expenditures and for other general corporate purposes, including
acquisitions permitted hereunder. The Letters of Credit shall be used for the
purposes described in Section 2.9(a).
ARTICLE VIII
GENERAL LOAN PROVISIONS
SECTION 8.1 INTEREST.
(a) INTEREST RATE OPTIONS. Subject to the provisions of this Section
3.1, at the election of the Borrower in accordance with ARTICLE II, (i) the
unpaid principal balance of any Revolving Loan shall bear interest at (A) the
Base Rate PLUS the Applicable Margin or (B) the Adjusted LIBOR Rate PLUS the
Applicable Margin and (ii) the unpaid balance of any Swingline Loan shall bear
interest at the (A) Base Rate PLUS the Applicable Margin or (B) the LIBOR Market
Index Rate PLUS the Applicable Margin. Any Revolving Loan as to which the
Borrower has not duly specified an interest rate as provided herein shall be
deemed a Base Rate Loan. Except as set forth in Section 2.6 (b), any Swingline
Loan as to which the Borrower has not duly specified an interest rate as
provided herein shall be deemed a Base Rate Loan.
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(b) INTEREST PERIODS.
(i) In connection with each LIBOR Loan, the Borrower, by
giving notice at the times described in Sections 2.2 and 3.2, shall
elect an interest period (each, an "Interest Period") to be applicable
to such Loan, which Interest Period shall be a period of one (1) month,
three (3) months or six (6) months; PROVIDED that:
(A) each Interest Period shall commence on the date
of advance of or conversion to any LIBOR Loan and, in the case
of immediately successive Interest Periods, each successive
Interest Period shall commence on the date on which the next
preceding Interest Period expires;
(B) if any Interest Period would otherwise expire on
a day that 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 an a day that 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;
(C) any Interest Period that begins on the last
Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at
the end of such Interest Period) shall end on the last
Business Day of the relevant calendar month at the end of such
Interest Period; and
(D) no Interest Period shall extend beyond the
Termination Date and there shall be no more than 5 different
Interest Periods in effect at any time.
(c) DEFAULT RATE. Upon the occurrence and during the continuance of an
Event of Default, (i) the Borrower shall no longer have the option to request
LIBOR Loans, (ii) all outstanding LIBOR Loans shall bear interest at a rate per
annum two percent (2%) in excess of the rate then applicable to LIBOR Loans
until the end of the applicable Interest Period and thereafter at a rate equal
to two percent (2%) in excess of the rate then applicable to Base Rate Loans,
(iii) all outstanding Base Rate Loans and LIBOR Market Index Swingline Loans
shall bear interest at a rate per annum equal to two percent (2%) in excess of
the rate then applicable to Base Rate Loans and (iv) the Letter of Credit Fees
shall be increased by two percent (2%) above the then applicable Applicable
Margin. To the extent permitted by law, interest shall continue to accrue on the
Notes after the filing by or against the Borrower of any petition seeking any
relief in bankruptcy or under any act or law pertaining to insolvency or debtor
relief, whether state, federal or foreign.
(d) INTEREST PAYMENT AND COMPUTATION. Subject to the provisions of
Section 3.1(c), interest on the Revolving Loans shall be payable (i) for Base
Rate Loans, quarterly in arrears as of the end of each calendar quarter and (ii)
for LIBOR Loans, on the last day of the applicable Interest Period (and with
respect to any LIBOR Loan with an Interest Period of 6 months, on the
34
date 3 months after the making of such LIBOR Loan and on the last day of the
applicable Interest Period). Subject to the provisions of Section 3.1(c),
interest on the Swingline Loans shall be payable (i) on the maturity date agreed
to by the Swingline Lender pursuant to Section 2.7(a) with respect to such Loan
and (ii) with respect to Swingline Loans made pursuant to the Sweep Plus
Arrangement, in accordance with the Sweep Plus Arrangement. The interest rates
hereunder for all LIBOR Loans and LIBOR Market Index Swingline Loans shall be
calculated based on a 360 day year for the actual number of days elapsed, and
the interest rates hereunder for Base Rate Loans shall be calculated based on a
365\366 day year for the actual number of days elapsed.
(e) MAXIMUM RATE. In no contingency or event whatsoever shall the
aggregate of all amounts deemed interest hereunder or under the Notes charged or
collected pursuant to the terms of this Agreement or pursuant to the Notes
exceed the highest rate permissible under any Applicable Law which a court of
competent jurisdiction shall, in a final determination, deem applicable hereto.
In the event that such a court determines that any Lender has charged or
received interest hereunder in excess of the highest applicable rate, the rate
in effect hereunder shall automatically be reduced to the maximum rate permitted
by Applicable Law and such Lender shall, at its option, promptly refund to the
Borrower any interest received by such Lender in excess of the maximum lawful
rate or apply such excess to the principal balance of the Obligations. It is the
intent hereof that the Borrower not pay or contract to pay, and that the Lenders
not receive or contract to receive, directly or indirectly in any manner
whatsoever, interest in excess of that which may be paid by the Borrower under
Applicable Law.
SECTION 8.2 NOTICE AND MANNER OF CONVERSION OR CONTINUATION OF
LOANS.
The Borrower shall have the option to (a) convert at any time all or
any portion of its outstanding Base Rate Loans (other than Swingline Loans) in a
principal amount equal to $1,000,000 or any whole multiple of $250,000 in excess
thereof into one or more LIBOR Loans (so long as there are no more than 5 LIBOR
Loans outstanding at any one time), or (b) upon the expiration of any Interest
Period, (i) convert all or any part of such outstanding LIBOR Loans into Base
Rate Loans or (ii) continue such LIBOR Loans as LIBOR Loans; PROVIDED, that no
outstanding Loan may be continued as, or converted into, a LIBOR Loan when any
Event of Default has occurred and is continuing. Whenever the Borrower desires
to convert or continue Loans as provided above, the Borrower shall give the
Agent irrevocable prior written notice in the form attached as EXHIBIT D (a
"Notice of Conversion/Continuation") not later than 11:00 a.m. on the same
Business Day as, in the case of a Loan being converted into or continued as a
Base Rate Loan, and three (3) Business Days before, in the case of a Loan being
converted into or continued as a LIBOR Loan, the day on which a proposed
conversion or continuation of such Loan is to be effective specifying (A) the
Loans to be converted or continued and the amount thereof, (B) in the case of
any LIBOR Loans to be converted or continued, the last day of the Interest
Period therefor and the Interest Period to be applicable to the converted or
continued Loans and (C) the effective date of the conversion or continuation
(which shall be a Business Day). The Agent shall give each Lender notice as
promptly as practicable of any such proposed extension or conversion affecting
any Revolving Loan.
35
SECTION 8.3 FEES.
(a) The Borrower shall pay to the Agent all fees payable to the Agent
on the Closing Date and from time to time thereafter.
(b) In consideration of the Revolving Commitments of the Lenders
hereunder, the Borrower agrees to pay to the Agent for the account of each
Lender a fee (the "COMMITMENT FEE") on the Unused Revolving Committed Amount
computed at a per annum rate (based on a year of 360 days) for each day during
the applicable Commitment Fee Calculation Period (hereinafter defined) at a rate
equal to the Applicable Margin in effect from time to time. The Commitment Fee
shall commence to accrue on the Closing Date and shall be due and payable in
arrears on the last business day of each March, June, September and December
(and any date that the Revolving Committed Amount is reduced as provided in
Section 2.11, or the Maturity Date) for the immediately preceding quarter (or
portion thereof) (each such quarter or portion thereof for which the Commitment
Fee is payable hereunder being herein referred to as an "COMMITMENT FEE
CALCULATION PERIOD"), beginning with the first of such dates to occur after the
Closing Date. For purposes of computation of the Commitment Fee, Swingline Loans
shall not be counted toward or considered usage under the Revolving Committed
Amount.
(c) LETTER OF CREDIT FEES. In consideration of the LOC Commitments, the
Borrower agrees to pay to the Issuing Lender a fee (the "LETTER OF CREDIT FEE")
equal to the Applicable Margin per annum (based on a year of 360 days) on the
average daily maximum amount available to be drawn under each Letter of Credit
from the date of issuance to the date of expiration. In addition to such Letter
of Credit Fee, the Issuing Lender may charge, and retain for its own account
without sharing by the other Lenders, an additional facing fee of one-fourth of
one percent (1/4%) per annum on the average daily maximum amount available to be
drawn under each such Letter of Credit issued by it. The Issuing Lender shall
promptly pay over to the Agent for the ratable benefit of the Lenders (including
the Issuing Lender) the Letter of Credit Fee. The Letter of Credit Fee shall be
payable in arrears on the last business day of each March, June, September and
December for the immediately preceding quarter.
(d) ISSUING LENDER FEES. In addition to the Letter of Credit Fees
payable pursuant to subsection (c) hereof, the Borrower shall pay to the Issuing
Lender for its own account without sharing by the other Lenders the reasonable
and customary charges from time to time of the Issuing Lender with respect to
the amendment, transfer, administration, cancellation and conversion of, and
drawings under, such Letters of Credit (collectively, the "ISSUING LENDER
FEES").
SECTION 8.4 MANNER OF PAYMENT.
Each payment by the Borrower on account of the principal of or interest
on the Loans or of any fee, commission or other amounts payable to the Lenders
under this Agreement or the Notes shall be made not later than 2:00 P.M. on the
date specified for payment under this Agreement to the Agent at its address
referred to in Section 13.1, in Dollars, in immediately available funds and
shall be made without any set-off, counterclaim or deduction whatsoever.
36
Any payment received after such time but before 5:00 P.M. on such day shall be
deemed a payment on such date for the purposes of Section 11.1, but for all
other purposes shall be deemed to have been made on the next succeeding Business
Day. Any payment received after 5:00 P.M. shall be deemed to have been made on
the next succeeding Business Day for all purposes. Subject to Section
3.1(b)(i)(B), if any payment under this Agreement or any Note shall be specified
to be made upon a day which is not a Business Day, it shall be made on the next
succeeding day which is a Business Day and such extension of time shall in such
case be included in computing any interest if payable along with such payment.
As soon as practicable after the Agent receives payment from the
Borrower, the Agent will cause to be distributed like funds relating to the
payment of principal, interest, or Fees (other than amounts payable to the Agent
to reimburse the Agent or the Issuing Lender for fees and expenses payable
solely to it, as the case may be) or expenses payable to the Agent and the
Lenders in accordance with Section 13.9, ratably (except in the case of
Swingline Loans) to the Lenders, and like funds relating to the payment of any
other amounts payable to such Lender, in each case to be distributed and applied
in accordance with the terms of Section 3.10; provided that if such payment is
received by the Agent prior to 2:00 P.M., the Agent shall use reasonable efforts
to distribute funds relating to such payment to the Lenders prior to 4:00 P.M.
on the same date.
SECTION 8.5 CHANGED CIRCUMSTANCES.
(a) CIRCUMSTANCES AFFECTING LIBOR RATE OR LIBOR MARKET INDEX RATE
AVAILABILITY. If prior to the first day of any Interest Period, (i) the Agent
shall have determined in good faith (which determination shall be conclusive and
binding upon the Borrower absent manifest error) that, by reason of
circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining the LIBOR Rate for such Interest Period, (ii) the
Agent has received notice from the Required Lenders that the LIBOR Rate
determined or to be determined for such Interest Period will not adequately and
fairly reflect the cost to such Lenders of making or maintaining their LIBOR
Loans during such Interest Period, or (iii) Dollar deposits in the principal
amounts of the LIBOR Loans to which such Interest Period is to be applicable are
not generally available in the London interbank market, the Agent shall give
telecopy or telephonic notice thereof to the Borrower and the Lenders as soon as
practicable thereafter, and will also give prompt written notice to the Borrower
when such conditions no longer exist. If such notice is given (i) any LIBOR
Loans requested to be made on the first day of such Interest Period shall be
made as Base Rate Loans, (ii) any Revolving Loans that were to have been
converted on the first day of such Interest Period to or continued as LIBOR
Loans shall be converted to or continued as Base Rate Loans and (iii) each
outstanding LIBOR Loan shall be converted, on the last day of the then-current
Interest Period thereof, to Base Rate Loans. Until such notice has been
withdrawn by the Agent, no further LIBOR Loans shall be made or continued as
such, nor shall the Borrower have the right to convert Base Rate Loans to LIBOR
Loans.
Notwithstanding any other provision of this Agreement, if (i) the
Swingline Lender shall reasonably determine (which determination shall be
conclusive and binding absent manifest error) that, by reason of circumstances
affecting the relevant market, reasonable and adequate
37
means do not exist for ascertaining the LIBOR Market Index Rate, or (ii) the
Swingline Lender shall reasonably determine (which determination shall be
conclusive and binding absent manifest error) that the LIBOR Market Index Rate
does not adequately and fairly reflect the cost of funding LIBOR Market Index
Swingline Loans, the Swingline Lender shall forthwith give telephone notice of
such determination, confirmed in writing, to the Borrower, and thereafter the
right to request LIBOR Market Index Swingline Loans shall be suspended until
such time as the conditions giving rise to such notice shall no longer exist. In
the event LIBOR Market Index Swingline Loans are not available on account of
operation of this Section, the Swingline Lender will endeavor to provide an
alternative index or reference rate which will provide a similar interest rate
based on historical data.
(b) LAWS AFFECTING LIBOR RATE AVAILABILITY. Notwithstanding any other
provision herein, if the adoption of or any change in any law, treaty, rule or
regulation or final, non-appealable determination of an arbitrator or a court or
other governmental authority or in the interpretation or application thereof
occurring after the Closing Date shall make it unlawful for any Lender to make
or maintain LIBOR Loans as contemplated by this Credit Agreement, (i) such
Lender shall promptly give written notice of such circumstances to the Borrower
and the Agent (which notice shall be withdrawn whenever such circumstances no
longer exist), (ii) the commitment of such Lender hereunder to make LIBOR Loans,
continue LIBOR Loans as such and convert a Base Rate Loan to LIBOR Loans shall
forthwith be canceled and, until such time as it shall no longer be unlawful for
such Lender to make or maintain LIBOR Loans, such Lender shall then have a
commitment only to make a Base Rate Loan when a LIBOR Loan is requested and
(iii) such Lender's Revolving Loans then outstanding as LIBOR Loans, if any,
shall be converted automatically to Base Rate Loans on the respective last days
of the then current Interest Periods with respect to such Revolving Loans or
within such earlier period as required by law. If any such conversion of a LIBOR
Loan occurs on a day which is not the last day of the then current Interest
Period with respect thereto, the Borrower shall pay to such Lender such amounts,
if any, as may be required pursuant to Section 3.5(c).
(c) INCREASED COSTS. If, after the date hereof, the introduction of, or
any change in, any Applicable Law, or 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 the Lender
with any request or directive (whether or not having the force of law) of such
Governmental Authority, central bank or comparable agency:
(i) shall subject any Lender to any tax, duty or other charge
with respect to the Notes or any Letter of Credit or any application
relating thereto or shall change the basis of taxation of payments to
such Lender in respect thereof (except for changes in the rate of tax
on the net income of such Lender imposed by the jurisdiction in which
such Lender is organized or is or should be qualified to do business or
the Lender's office is located); or
(ii) shall impose, modify or deem applicable any reserve
(including, without limitation, any imposed by the Board of Governors
of the Federal Reserve System but excluding any reserve included in the
Adjusted LIBOR Rate Reserve Percentage), special
38
deposit, insurance or capital or similar requirement against assets of,
deposits with or for the account of, or credit extended by any Lender
or shall impose on any Lender or the foreign exchange and interbank
markets any other condition affecting the Notes;
and the result of any of the foregoing is to increase the costs to any Lender of
maintaining any LIBOR Loan or the Letters of Credit or to reduce the yield or
amount of any sum received or receivable by such Lender under this Agreement or
under the Notes then such Lender shall promptly notify the Borrower of such fact
and demand compensation therefor and, within fifteen (15) days after such notice
by such Lender, the Borrower shall pay to such Lender such additional amount or
amounts as will compensate such Lender for such increased cost or reduction.
Such Lender will promptly notify the Borrower of any event of which it has
knowledge which will entitle it to compensation pursuant to this Section 3.5(c);
PROVIDED, that such Lender shall incur no liability whatsoever to the Borrower
in the event it fails to do so. A certificate of the Lender setting forth the
basis for determining such amount or amounts necessary to compensate the Lender
shall be forwarded to the Borrower and shall be conclusively presumed to be
correct absent manifest error.
SECTION 8.6 INDEMNITY.
The Borrower hereby indemnifies the Lenders against any loss or expense
which may result directly and primarily from any Lender's obtaining, liquidating
or employing deposits or other funds acquired to effect, fund or maintain any
Loan (a) as a consequence of any failure by the Borrower to make any payment
when due in connection with a LIBOR Loan, (b) due to any failure of the Borrower
to borrow on a date specified therefor in a Notice of Borrowing, Notice of
Conversion/Continuation or (c) due to any payment, prepayment or conversion of
any LIBOR Loan on a date other than the last day of the Interest Period
therefor. A certificate of such Lender setting forth the basis for determining
such amount or amounts necessary to compensate the Lender shall be forwarded to
the Borrower and shall be conclusively presumed to be correct absent manifest
error.
SECTION 8.7 CAPITAL REQUIREMENT.
If either (a) the introduction of, or any change in, or in the
interpretation of, any Applicable Law or (b) compliance with any guideline or
request from any central bank or comparable agency or other Governmental
Authority (whether or not having the force of law), has or would have the effect
of reducing the rate of return on the capital of, or has affected or would
affect the amount of capital required to be maintained by, any Lender or any
corporation controlling any Lender as a consequence of, or with reference to the
Revolving Commitment of any Lender and other commitments of this type, below the
rate which such Lender or such other corporation could have achieved but for
such introduction, change or compliance, then within five (5) Business Days
after written demand by such Lender, the Borrower shall pay to such Lender from
time to time as specified by such Lender additional amounts sufficient to
compensate such Lender or other corporation for such reduction. A certificate as
to such amounts submitted to the Borrower by such Lender shall be conclusively
presumed to be correct, absent manifest error.
39
SECTION 8.8 TAXES.
(a) PAYMENTS FREE AND CLEAR. Any and all payments by the Borrower
hereunder or under the Notes to or for the benefit of any Lender shall be made
free and clear of and without deduction for any and all present or future taxes,
levies, imposts, deductions, charges or withholding, and all liabilities with
respect thereto, excluding, in the case of each such Lender and the Agent,
income and franchise taxes imposed by the jurisdiction under the laws of which
such Lender or the Agent is organized or is or should be qualified to do
business or any political subdivision thereof (all such non-excluded taxes,
levies, imposts, deductions, charges, withholdings and liabilities being
hereinafter referred to as "Taxes"). If the Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder or under the
Notes to or for the benefit of any Lender or the Agent, (i) the sum payable
shall be increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 3.8) such Lender or the Agent, as the case may be, receives an
amount equal to the amount it would have received had no such deductions been
made, (ii) the Borrower shall make such deductions, (iii) the Borrower shall pay
the full amount deducted to the relevant taxing authority or other authority in
accordance with applicable law and (iv) the Borrower shall deliver to such
Lender or the Agent, as the case may be, evidence of such payment to the
relevant taxing authority or other authority in the manner provided in Section
3.8(e); PROVIDED, HOWEVER, that the Borrower shall be under no obligation to
increase the sum payable to any Lender not organized under the laws of the
United States or a state thereof (a "Foreign Lender") by an amount equal to the
amount of the United States tax required to be withheld under United States law
from the sums paid to such Foreign Lender, if such withholding is caused by the
failure of such Foreign Lender to be engaged in the active conduct of a trade or
business in the United States or all amounts of interest and fees to be paid to
such Foreign Lender hereunder are not effectively connected with such trade or
business within the meaning of United States Treasury Regulation 1.1441-4(a).
.
(b) Each Foreign Lender agrees that it will deliver to the Borrower and
the Agent (i) two duly completed copies of United States Internal Revenue
Service Form 1001 or 4224 or successor applicable form(s), as the case may be,
and (ii) an Internal Revenue Service Form W-8 or W-9 or successor applicable
form(s). Each such Lender also agrees to deliver to the Borrower and the Agent
two further copies of the said Form 1001 or 4224 and Form W-8 or W-9, or
successor applicable forms or other manner of certification, as the case may be,
on or before the date that any such form expires or becomes obsolete or after
the occurrence of any event requiring a change in the most recent form
previously delivered by it to the Borrower, and such extensions or renewals
thereof as may reasonably be requested by the Borrower or the Agent, unless in
any such case an event (including, without limitation, any change in treaty, law
or regulation) has occurred prior to the date on which any such delivery would
otherwise be required which renders all such forms inapplicable or which would
prevent such Lender from duly completing and delivering any such form with
respect to it and such Lender so advises the Borrower and the Agent. Such Lender
shall certify (A) in the case of a Form 1001 or 4224, that it is entitled to
receive payments under this Credit Agreement without deduction or withholding
40
of any United States federal income taxes and (B) in the case of a Form W-8 or
W-9, that it is entitled to an exemption from United States backup withholding
tax.
(c) STAMP AND OTHER TAXES. In addition, the Borrower shall pay any
present or future stamp, registration, recordation or documentary taxes or any
other similar fees or charges or excise or property taxes, levies of the United
States or any state or political subdivision thereof or any applicable foreign
jurisdiction which arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to this Agreement, the
Loans, the other Credit Documents, or the perfection of any rights or security
interest in respect thereto (hereinafter referred to as "Other Taxes") .
(d) INDEMNITY. The Borrower shall indemnify each Lender and the Agent
for the full amount of Taxes and Other Taxes (including, without limitation, any
Taxes and Other Taxes imposed by any jurisdiction on amounts payable under this
Section 3.8) paid by such Lender or the Agent and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted.
Such indemnification shall be made within thirty (30) days from the date such
Lender or the Agent makes written demand therefor.
(e) EVIDENCE OF PAYMENT. Within thirty (30) days after the date of any
payment of Taxes or Other Taxes paid on behalf of the Agent or any Lender, the
Borrower shall furnish to the Agent or any such Lender, at its address referred
to in Section 13.1, the original or a certified copy of a receipt evidencing
payment thereof or other evidence of payment satisfactory to the Agent or any
such Lender.
(f) SURVIVAL. Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 3.8 shall survive the payment in full of the
Obligations and the termination of this Agreement.
SECTION 8.9 SHARING OF PAYMENTS.
If any Lender shall obtain any payment (whether voluntary, involuntary,
through the exercise of any right of set-off or otherwise) on account of the
Revolving Loans made by it or LOC Obligations in excess of its pro rata share of
such payment as provided for in this Credit Agreement, such Lender shall
forthwith purchase from the other Lenders such participations in the Revolving
Loans made by them or LOC Obligations of such Lenders as shall be necessary to
cause such purchasing Lender to share such excess payment with all Lenders in
accordance with their respective ratable shares as provided for in this Credit
Agreement; PROVIDED, HOWEVER, that if all or any portion of such excess is
thereafter recovered from such purchasing Lender, such purchase from each Lender
shall be rescinded and each such Lender shall repay to the purchasing Lender the
purchase price to the extent of such recovery together with an amount equal to
such Lender's ratable share (according to the proportion of (i) the amount of
such Lender's required repayment to (ii) the total amount so recovered from the
purchasing Lender) of any interest or other amount paid or payable by the
purchasing Lender in respect to the total amount so recovered. The Borrower
agrees that any Lender so purchasing a participation from another
41
Lender pursuant to this Section 3.9 may, to the fullest extent permitted by law,
exercise all of its rights of payment (including the right of set-off) with
respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation.
SECTION 8.10 PRO RATA TREATMENT.
Each Revolving Loan, each payment or prepayment of principal of any
Revolving Loan, each payment of interest on the Revolving Loans, each payment of
the Commitment Fee, each payment of the Letter of Credit Fee, each reduction of
the Revolving Commitment and each conversion or extension of any Revolving Loan,
shall be allocated pro rata among the Lenders in accordance with the respective
principal amounts of their outstanding Revolving Loans; PROVIDED, HOWEVER, that
the foregoing fees payable hereunder to the Lenders shall be allocated to each
Lender based on such Lender's Revolving Commitment Percentage or LOC Commitment
Percentage, as applicable.
ARTICLE IX
[RESERVED]
ARTICLE X
CLOSING: CONDITIONS OF CLOSING AND BORROWING
SECTION 10.1 CONDITIONS TO CLOSING AND INITIAL LOANS.
The obligation of the Lenders to make any Revolving Loan hereunder is
subject to the satisfaction of, or waiver of, prior to or concurrently with the
making of such Revolving Loan, the following conditions precedent:
(a) EXECUTED CREDIT DOCUMENTS.
Each Credit Document shall have been duly authorized and executed by
the parties thereto, shall be in full force and effect and the Credit Parties
shall have delivered or caused to be delivered original counterparts thereof to
the Agent.
(b) CLOSING CERTIFICATES: ETC.,
(i) OFFICER'S CERTIFICATE OF THE BORROWER. The Agent shall
have received a certificate from an officer of the Borrower, in form
and substance satisfactory to the Lenders, to the effect that (A) to
the best of his knowledge, all representations and warranties of the
Credit Parties contained in this Agreement and the other Credit
Documents are true, correct and complete; (B) the Credit Parties are
not in violation of any of the covenants contained in this Agreement
and the other Credit Documents; (C) after giving effect to the
transactions contemplated by this Agreement, no Default or
42
Event of Default has occurred and is continuing; and (D) that the
Credit Parties have satisfied each of the closing conditions described
herein.
(ii) CERTIFICATES OF SECRETARY OR ASSISTANT SECRETARY OF THE
CREDIT PARTIES. The Agent shall have received a certificate of the
secretary or an assistant secretary of each Credit Party certifying (A)
that attached thereto is a true and complete copy of the charter
documents of such Credit Party and all amendments thereto, certified as
of a recent date by the appropriate Governmental Authority in its
jurisdiction of formation; (B) that attached thereto is a true and
complete copy of the bylaws of such Credit Party, as in effect on the
date of such certification; (C) that attached thereto is a true and
complete copy of resolutions duly adopted by the Board of Directors of
such Credit Party authorizing the execution, delivery and performance
of this Agreement and the other Credit Documents to which it is a party
and (D) as to the incumbency and genuineness of the signature of each
officer of such Credit Party executing the Credit Documents and related
documents and certificates to which it is a party.
(iii) CERTIFICATES OF GOOD STANDING AND TAX CLEARANCE. The
Agent shall have received certificates as of a recent date of the good
standing of each Credit Party under the laws of its respective
jurisdiction of organization and, to the extent customarily provided by
such taxing authorities and to the extent reasonably available, a
certificate of the relevant taxing authority of its jurisdiction of
organization certifying that such Credit Party has filed required tax
returns and owes no delinquent taxes.
(iv) OPINIONS OF COUNSEL. The Agent shall have received
favorable opinions of counsel to the Credit Parties addressed to the
Lenders, the Credit Documents and related documents and certificates to
which such Person is a party, the security interests created thereby
and such other matters as the Agent and its counsel shall request.
(c) CONSENTS; NO ADVERSE CLAIM.
(i) GOVERNMENTAL AND THIRD PARTY APPROVALS. All necessary
approvals, authorizations and consents, if required, of any Person and
of all Governmental Authorities and courts having jurisdiction with
respect to the transactions contemplated by this Agreement and the
other Credit Documents shall have been obtained.
(ii) NO INJUNCTION, ETC. No action, proceeding, investigation,
regulation or legislation shall have been instituted, threatened or
proposed before any Governmental Authority to enjoin, restrain or
prohibit, or to obtain substantial damages in respect of, or which is
related to or arises out of, this Agreement or the other Credit
Documents or the consummation of the transactions contemplated hereby
or thereby, or which, in the Lenders' reasonable discretion, would make
it inadvisable to consummate the transactions contemplated by this
Agreement and the other Credit Documents.
(iii) NO MATERIAL ADVERSE CHANGE. Since December 31, 1997,
there shall not have occurred any material adverse change in the
business condition (financial or
43
otherwise), operations, properties or prospects of the Borrower and its
Subsidiaries or any event, condition or state of facts that will or
could be reasonably expected to have a Material Adverse Effect.
(iv) NO EVENT OF DEFAULT. No Default or Event of Default shall
have occurred and be continuing.
(d) FINANCIAL MATTERS.
(i) FINANCIAL STATEMENTS. The Lenders shall have received the
most recent annual audited and interim unaudited Consolidated financial
statements of the Borrower, and its Subsidiaries or, in the event no
such financial statements are available, such other financial
information as shall be acceptable to the Lenders in their sole
discretion.
(ii) FINANCIAL PROJECTIONS. The Lenders shall have received an
opening pro forma balance sheet of the Borrower and its Subsidiaries as
of a recent date giving effect to the transactions contemplated herein
and demonstrating compliance with the financial covenants contained
herein, together with projected annual financial statements of the
Borrower and its Subsidiaries through December 31, 2001, each in form
and substance satisfactory to the Agent.
(iii) OPENING OFFICER'S COMPLIANCE CERTIFICATE. The Lenders
shall have received an Officer's Compliance Certificate demonstrating
that the Borrower and its Subsidiaries are in compliance with the
financial covenants set forth in ARTICLE IX as of the Closing Date.
.
(iv) PAYMENT AT CLOSING. There shall have been paid by the
Borrower to the Agent, the fees, set forth or referenced in Section 3.3
(to the extent required to be paid on or prior to the Closing Date) and
any other accrued and unpaid fees due hereunder (including, without
limitation, legal fees and expenses) .
(e) COLLATERAL MATTERS. The Agent shall have received:
(i) searches of Uniform Commercial Code filings in the
jurisdiction of the chief executive office of each Credit Party and
each jurisdiction where any Collateral is located or where a filing
would need to be made in order to perfect the Collateral Agent's
security interest in the Collateral, copies of the financing statements
on file in such jurisdictions and evidence that no Liens exist other
than Permitted Liens;
(ii) duly executed UCC financing statements for each
appropriate jurisdiction as is necessary, in the Agent's sole
discretion, to perfect the Collateral Agent's security interest in the
Collateral;
44
(iii) searches of ownership of intellectual property in the
appropriate governmental offices and such patent/trademark/copyright
filings as requested by the Agent in order to perfect the Collateral
Agent's security interest in the Collateral;
(iv) all instruments and chattel paper in the possession of
the Credit Parties, together with allonges or assignments as may be
necessary or appropriate to perfect the Collateral Agent's security
interest in the Collateral to the extent required under the Security
Agreement and/or the Pledge Agreement;
(v) duly executed consents as are necessary, in the Agent's
sole discretion, to perfect the Collateral Agent's security interest in
the Collateral; and
(vi) satisfactory evidence that (A) the Collateral Agent, on
behalf of the Lenders, holds a perfected Lien on all Collateral and (B)
none of the Collateral is subject to any other Liens other than
Permitted Liens.
(f) MISCELLANEOUS.
(i) TERMINATION OF EXISTING DEBT. Each of the Borrower and its
Subsidiaries shall have paid and satisfied all of its obligations with
respect to the Existing Debt. Evidence of the satisfaction of all such
credit facilities and the documents related thereto shall have been
received and approved by the Agent.
(ii) EVIDENCE OF INSURANCE. The Agent shall have received
copies of insurance policies or certificates of insurance of the Credit
Parties evidencing liability and casualty insurance meeting the
requirements set forth herein and in the other Credit Documents,
including, but not limited to, naming the Agent as sole loss payee and
additional insured.
(iii) CORPORATE STRUCTURE. The corporate capital and ownership
structure of the Borrower and its Subsidiaries shall be as described in
SCHEDULE 5.1.
(iv) OTHER. The Agent shall have received all other documents
and information in connection with the transactions contemplated by
this Agreement as it may reasonably request.
SECTION 10.2 CONDITIONS TO ALL LOANS AND LETTERS OF CREDIT.
The obligation of the Lenders to make any Loan or of the Issuing Lender
to issue any Letter of Credit is subject to the satisfaction of the following
conditions precedent on the relevant date:
(a) CONTINUATION OF REPRESENTATIONS AND WARRANTIES. The representations
and warranties contained in ARTICLE VI shall be true and correct in all material
respects on and as of such date with the same effect as if made on and as of
such date (except to the extent such representations and warranties are
expressly made as of a specified date, in which event such
45
representations and warranties shall be true and correct in all material
respects as of such specified date).
(b) NO EXISTING DEFAULT. No Default or Event of Default shall have
occurred and be continuing hereunder on such date with respect to such Loan or
Letter of Credit or after giving effect to the Loans to be made or Letters of
Credit to be issued on such date.
(c) ADDITIONAL CONDITIONS TO LETTERS OF CREDIT. With respect to any
request for the issuance of a Letter of Credit, all conditions set fort in
Section 2.9 shall have been satisfied.
ARTICLE XI
REPRESENTATIONS AND WARRANTIES OF THE BORROWER
SECTION 11.1 REPRESENTATIONS AND WARRANTIES.
In order to induce the Lenders to enter into this Credit Agreement and
to make available the credit facilities contemplated hereby, each Credit Party
hereby represents and warrants to the Lenders as of the date hereof, the Closing
Date and on the date of each extension of credit hereunder, as follows:
(a) ORGANIZATION; POWER; QUALIFICATION. Each Credit Party is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or formation, has the power and authority to
own its properties and to carry on its business as now being and hereafter
proposed to be conducted and is duly qualified and authorized to do business in
each jurisdiction in which the character of its properties or the nature of its
business requires such qualification and authorization, except where the failure
to be so qualified and authorized could not reasonably be expected to have a
Material Adverse Effect.
(b) SUBSIDIARIES AND CAPITALIZATION. As of the date hereof the
corporate ownership and capital structure of the Borrower and its Subsidiaries
is as set forth on SCHEDULE 5.1.
(c) AUTHORIZATION OF AGREEMENT, CREDIT DOCUMENTS AND BORROWING. Each
Credit Party has the corporate right, power and authority and has taken all
necessary corporate and other action to authorize the execution, delivery and
performance of this Agreement and each of the other Credit Documents to which it
is a party in accordance with their respective terms. This Agreement and each of
the other Credit Documents have been duly executed and delivered by the duly
authorized officers of the Credit Parties, and each such document constitutes
the legal, valid and binding obligation of the Credit Parties party thereto,
enforceable in accordance with its terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar state
or federal debtor relief laws from time to time in effect which affect the
enforcement of creditors' rights in general and the availability of equitable
remedies.
(d) COMPLIANCE OF AGREEMENT, CREDIT DOCUMENTS AND BORROWING WITH LAWS,
ETC. The execution, delivery and performance by each Credit Party of the Credit
Documents to which
46
it is a party, in accordance with their respective terms, the borrowings
hereunder and the transactions contemplated hereby do not and will not, by the
passage of time, the giving of notice or otherwise, (i) require any Governmental
Approval or violate any Applicable Law relating to such Credit Party, (ii)
conflict with, result in a breach of or constitute a default under the
certificate of formation or other organizational documents of such Credit Party
or any material indenture, agreement or other instrument to which such Person is
a party or by which any of its properties may be bound or any Governmental
Approval relating to such Credit Party or (iii) result in or require the
creation or imposition of any Lien upon or with respect to any property now
owned or hereafter acquired by such Credit Party other than Liens arising under
the Credit Documents.
(e) COMPLIANCE WITH LAW; GOVERNMENTAL APPROVALS. Each of the Borrower
and its Subsidiaries (i) has all Governmental Approvals required by any
Applicable Law for it to conduct its business, each of which is in full force
and effect, is final and not subject to review on appeal and is not the subject
of any pending or, to the best of its knowledge, threatened attack by direct or
collateral proceeding and (ii) is in compliance with each Governmental Approval
applicable to it and all other Applicable Laws relating to it or any of its
respective properties, except in each case under clause (i) and (ii) above to
the extent that (A) such requirement or compliance is contested in good faith by
appropriate proceedings or (B) the failure to do so could not reasonably be
expected to have a Material Adverse Effect.
(f) TAX RETURNS AND PAYMENTS. Each of the Borrower and its Subsidiaries
has duly filed or caused to be filed all federal, state, local and other tax
returns required by Applicable Law to be filed, and has paid, or made adequate
provision for the payment of, all federal, state, local and other taxes,
assessments and governmental charges or levies upon it and its property, income,
profits and assets which are due and payable, except for any such taxes or
charges being contested in good faith by appropriate proceedings. No
Governmental Authority has asserted any Lien or other claim against the Borrower
or any Subsidiary thereof with respect to unpaid taxes which has not been
discharged or resolved. The charges, accruals and reserves on the books of the
Borrower or any of its Subsidiaries in respect of federal, state, local and
other taxes are in the judgment of the Credit Parties adequate, and the Credit
Parties do not anticipate any material additional taxes or assessments for any
year or portion thereof.
(g) INTELLECTUAL PROPERTY MATTERS. Each of the Borrower and its
Subsidiaries owns or possesses all lawful rights to use all franchises,
licenses, patents, patent rights or licenses, patent applications, copyrights,
copyright applications, trademarks, trademark rights, trade names, trade name
rights and rights with respect to the foregoing which are necessary in any
material respect to conduct its business. To the knowledge of the Credit
Parties, no event has occurred which permits, or after notice or lapse of time
or both would permit, the revocation or termination of any such rights, and
neither the Borrower nor any Subsidiary thereof is liable to any Person for
infringement under Applicable Law with respect to any such rights as a result of
its business operations.
47
(h) ENVIRONMENTAL MATTERS.
(i) To the best knowledge of the Credit Parties, the
properties of the Borrower and its Subsidiaries do not contain any
Hazardous Materials in amounts or concentrations which (A) constitute a
material violation of any Environmental Law, or (B) could give rise to
material liability under, applicable Environmental Laws or (C) could
trigger investigation, removal, remediation or other response
activities under any Environmental Laws;
(ii) To the best knowledge of the Credit Parties, the
properties of the Borrower and its Subsidiaries, and all operations
conducted in connection therewith, are in compliance with all
applicable Environmental Laws in all material respects and there are no
Hazardous Materials at or under the properties of the Borrower and its
Subsidiaries, or such operations thereon in violation of applicable
Environmental Laws or which could materially interfere with the
continued operation of such properties or which damage or could damage
natural resources on such properties in material violation of any
applicable Environmental Laws or materially impair the fair saleable
value thereof;
(iii) Neither the Borrower nor any Subsidiary has received any
notice of material violation, alleged material violation,
noncompliance, liability or potential liability regarding environmental
matters or compliance with Environmental Laws which remain unresolved
with regard to any of their properties or the operations conducted in
connection therewith, nor does any Credit Party have knowledge or
reason to believe that any other such notice will be received or is
being threatened;
(iv) To the best knowledge of the Credit Parties, Hazardous
Materials have not been transported or disposed of from the properties
of the Borrower and its Subsidiaries in material violation of, or in a
manner or to a location which could give rise to material liability of
the Borrower or any of its Subsidiaries under, Environmental Laws, nor
have any Hazardous Materials been generated, treated, stored or
disposed of at, on or under any of such properties in material
violation of, or in a manner that could give rise to material liability
of the Borrower or any of its Subsidiaries under, any applicable
Environmental Laws;
(v) No judicial proceedings or governmental or administrative
action is pending, or to the best knowledge of the Credit Parties,
threatened, under any Environmental Law to which the Borrower or any
Subsidiary thereof is or will be named as a party with respect to such
properties or operations conducted in connection therewith, nor are
there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or
judicial requirements outstanding under any Environmental Law with
respect to such properties or such operations; and
(vi) To the best knowledge of the Credit Parties, there has
been no release or threat of release of Hazardous Materials at or from
such properties, in violation of or in
48
amounts or in a manner that could give rise to material liability of
the Borrower or any of its Subsidiaries under Environmental Laws.
(i) ERISA. The Borrower and each ERISA Affiliate are in material
compliance with all applicable provisions of ERISA and the regulations and
published interpretations thereunder with respect to all Employee Benefit Plans
except for any required amendments for which the remedial amendment period as
defined in Section 401(b) of the Code has not yet expired. Each Employee Benefit
Plan that is intended to be qualified under Section 401(a) of the Code has been
determined by the Internal Revenue Service to be so qualified, and each trust
related to such plan has been determined to be exempt under Section 501(a) of
the Code. No Reportable Event has occurred as to which the Borrower or any ERISA
Affiliate was required to file a report with the PBGC and no liability
(including without limitation any withdrawal liability under Section 4201 of
ERISA) has been incurred by the Borrower or any ERISA Affiliate which remains
unsatisfied for any taxes or penalties with respect to any Employee Benefit Plan
or any Multiemployer Plan.
(j) MARGIN STOCK. Neither the Borrower nor any Subsidiary thereof is
engaged principally or as one of its activities in the business of extending
credit for the purpose of "purchasing" or "carrying" any "margin stock" (as each
such term is defined or used in Regulation U of the Board of Governors of the
Federal Reserve System). No part of the proceeds of any of the Loans will be
used for purchasing or carrying margin stock or for any purpose which violates,
or which would be inconsistent with, the provisions of Regulation T, U or X of
such Board of Governors.
(k) GOVERNMENT REGULATION. Neither the Borrower nor any Subsidiary
thereof is an "investment company" or a company "controlled" by an "investment
company" (as each such term is defined or used in the Investment Company Act of
1940, as amended) and neither the Borrower nor any Subsidiary thereof is, or
after giving effect to any Loan, will be, subject to regulation under the Public
Utility Holding Company Act of 1935 or the Interstate Commerce Act, each as
amended, or any other Applicable Law which limits its ability to incur or
consummate the transactions contemplated hereby.
(l) EMPLOYEE RELATIONS. Each of the Borrower and its Subsidiaries has a
stable work force in place and is not party to any collective bargaining
agreement nor has any labor union been recognized as the representative of its
employees. No Credit Party knows of any pending, threatened or contemplated
strikes, work stoppage or other collective labor disputes involving its
employees or those of its Subsidiaries.
(m) FINANCIAL STATEMENTS. The audited Consolidated balance sheet of the
Borrower and its Subsidiaries as of December 31, 1999, and the related
statements of income and retained earnings and cash flows for the Fiscal Year
then ended and unaudited Consolidated balance sheet of the Borrower and its
Subsidiaries as of March 31, 2000, and related unaudited interim statements of
income and retained earnings and cash flows for the fiscal period then ended,
copies of which have been furnished to the Lenders, fairly present in all
material respects the assets, liabilities and financial position of the Borrower
and its Subsidiaries as at such dates, and the results of the operations and
changes of financial position for the periods then ended. All
49
such financial statements, including the related schedules and notes thereto,
have been prepared in accordance with GAAP except as may be otherwise disclosed
therein or in the notes thereto (subject in the case of the interim statements
to year-end audit adjustments). As of the date hereof (after giving effect to
the repayment of the Existing Debt), except for Debt owed to Lenders, the
Borrower and its Subsidiaries have no Debt, obligation or other unusual forward
or long-term commitment which is not fairly reflected in the foregoing financial
statements or in the notes thereto.
(n) SOLVENCY. As of the Closing Date and after giving effect to each
Loan made hereunder, the Borrower and its Subsidiaries, taken as a whole, will
be Solvent.
(o) TITLES TO PROPERTIES. Each of the Borrower and its Subsidiaries has
such title to the real property owned by it (or a lease of real property) as is
necessary to the conduct of its business and valid and legal title to all of its
personal property and assets reflected on the balance sheets of the Borrower and
its Subsidiaries described in Section 6.1(m) or in any financial statements
hereafter delivered pursuant to Section 7.1, except such assets which have been
disposed of by the Borrower or its Subsidiaries subsequent to such date in the
ordinary course of business or as otherwise expressly permitted hereunder.
(p) DEBT AND LIENS. SCHEDULE 6.1(P) is a complete and correct list, as
of the date hereof, of each item of Debt of the Borrower and its Subsidiaries in
excess of $100,000 and each Lien securing such Debt, each of which is permitted
under the terms of Sections 10.1 and 10.2, respectively. The Borrower and its
Subsidiaries have performed and are in compliance with all of the terms of such
Debt and Liens and all instruments and agreements relating thereto, and no
default or event of default, or event or condition which with notice or lapse of
time or both would constitute such a default or event of default on the part of
the Borrower or its Subsidiaries exists with respect to any such Debt or Liens.
None of the properties and assets of the Borrower or any Subsidiary thereof is
subject to any Lien, except for Permitted Liens. Upon the proper filing of
financing statements and the proper recordation of other applicable documents
with the appropriate filing or recordation offices in each of the necessary
jurisdictions, the security interests granted pursuant to the Credit Documents
constitute and shall at all times constitute valid and enforceable first, prior
and perfected Liens on the Collateral (other than Permitted Liens). Each Credit
Party is or will be at the time additional Collateral is acquired by it, the
absolute owner of the Collateral with full right to pledge, sell, consign,
transfer and create a Lien therein, free and clear of any and all Liens in favor
of third parties, except Permitted Liens. The Credit Parties will at their
expense forever warrant and, at the Agent's request, defend the Collateral from
any and all Liens (other than Permitted Liens) of any third party. The Credit
Parties will not, and will not permit any of their Subsidiaries to, grant,
create or permit to exist, any Lien upon the Collateral, or any proceeds
thereof, in favor of any third party (other than Permitted Liens).
(q) LITIGATION. There are no actions, suits or proceedings pending nor,
to the best knowledge of the Credit Parties, threatened against or in any other
way relating adversely to or affecting the Borrower or any Subsidiary thereof or
any of their respective properties in any court
50
or before any arbitrator of any kind or before or by any Governmental Authority,
that, if adversely determined, might reasonably be expected to have a Material
Adverse Effect.
(r) ABSENCE OF DEFAULTS. No event has occurred or is continuing which
constitutes a Default or an Event of Default, or which constitutes, or which
with the passage of time or giving of notice or both would constitute, a default
or event of default by the Borrower or any Subsidiary thereof under any
judgment, decree or order by which the Borrower or its Subsidiaries or any of
their respective properties may be bound or which would require the Borrower or
its Subsidiaries to make any payment thereunder prior to the scheduled maturity
date therefor.
(s) ACCURACY AND COMPLETENESS OF INFORMATION. All written information,
reports and other papers and data produced by or on behalf of the Credit Parties
and furnished to the Lenders were, at the time the same were so furnished and
taken as a whole, true and correct in all material respects to the extent
necessary to give the recipient a true and accurate knowledge of the subject
matter. The documents and other written information furnished or written
statements made to the Lenders by the Credit Parties in connection with the
negotiation, preparation or execution of this Agreement or any of the Credit
Documents, taken as a whole, do not contain any untrue statement of a material
fact or omit to state a fact necessary in order to make the statements contained
therein not materially misleading. The Credit Parties are not aware of any facts
which it has not disclosed in writing to the Lenders which have a Material
Adverse Effect, or insofar as the Credit Parties can now foresee, could
reasonably be expected to have a Material Adverse Effect.
(t) BURDENSOME PROVISIONS. Neither the Borrower nor any of its
Subsidiaries is a party to any indenture, agreement, lease or other instrument,
or subject to any corporate or partnership restriction, Governmental Approval or
Applicable Law which is so unusual or burdensome as in the foreseeable future
could be reasonably expected to have a Material Adverse Effect. The Credit
Parties do not presently anticipate that future expenditures needed to meet the
provisions of any statutes, orders, rules or regulations of a Governmental
Authority will be so burdensome as to have a Material Adverse Effect.
(u) INSURANCE. The properties of the Borrower and its Subsidiaries are
insured with financially sound and reputable insurance companies in such
amounts, with such deductibles and covering such risks as are customarily
carried by companies engaged in similar businesses and owning similar properties
in localities where the Borrower and its Subsidiaries operate.
(v) NO MATERIAL ADVERSE CHANGE. Since December 31, 1997, there has been
no material adverse change in the business, condition (financial or otherwise),
operations or properties of the Borrower and its Subsidiaries, taken as a whole,
or any event, condition or state of facts that will or could be reasonably
expected to have a Material Adverse Effect.
(w) LOCATIONS OF OFFICES, RECORDS AND INVENTORY. Each Credit Party's
principal place of business and chief executive office are set forth in SCHEDULE
6.1(W) hereto, and the books and records of such Credit Party and all chattel
paper and all records of accounts are located at the principal place of business
and chief executive office of such Credit Party. There is no
51
jurisdiction in which any Credit Party maintains any Collateral other than those
jurisdictions listed on SCHEDULE 6.1(W). Set forth in SCHEDULE 6.1(W) is a true,
correct and complete list of (i) the address of the chief executive offices of
the Credit Parties and (ii) the address of all offices where records and books
of account of the Credit Parties are kept.
(x) FICTITIOUS BUSINESS NAMES. No Credit Party has used any corporate
or fictitious name during the five (5) years preceding the date hereof, other
than the corporate name shown on its or such Credit Party's Articles or
Certificate of Incorporation or other organizational document and as set forth
on SCHEDULE 6.1(X).
(y) MATERIAL CONTRACTS. None of the Material Contracts contains
provisions which could have a Material Adverse Effect. All of the Material
Contracts are in full force and effect, and no material defaults currently exist
thereunder.
SECTION 11.2 SURVIVAL OF REPRESENTATIONS AND WARRANTIES, ETC.
All representations and warranties set forth in this ARTICLE VI and all
representations and warranties contained in any certificate, or any of the
Credit Documents (including but not limited to any such representation or
warranty made in or in connection with any amendment thereto) shall constitute
representations and warranties made under this Agreement. All representations
and warranties made under this Agreement shall be made or deemed to be made at
and as of the Closing Date, shall survive the Closing Date and shall not be
waived by the execution and delivery of this Agreement, any investigation made
by or on behalf of the Lenders or any borrowing hereunder.
ARTICLE XII
FINANCIAL INFORMATION AND NOTICES
Until payment in full by the Borrower of all principal of and interest
on the Loans and all other amounts due hereunder and under the other Credit
Documents at the time of such payment, and the termination of the Commitments,
the Credit Parties will furnish or cause to be furnished to the Agent and the
Lenders:
SECTION 12.1 FINANCIAL STATEMENTS AND PROJECTIONS.
(a) ANNUAL FINANCIAL STATEMENTS. As soon as practicable and in any
event within ninety (90) days after the end of each Fiscal Year, an audited
Consolidated balance sheet of the Borrower and its Subsidiaries as of the close
of such Fiscal Year and audited Consolidated statements of income, retained
earnings and cash flows for the Fiscal Year then ended, including the notes
thereto, all in reasonable detail setting forth in comparative form the
corresponding figures for the preceding Fiscal Year and prepared by an
independent certified public accounting firm reasonably acceptable to the Agent
in accordance with GAAP and, if applicable, containing disclosure of the effect
on the financial position or results of operations of any change in the
application of accounting principles and practices during the year, and
accompanied by a report
52
thereon by such certified public accountants that is not qualified with respect
to scope limitations imposed by the Borrower or any of its Subsidiaries or with
respect to accounting principles followed by the Borrower or any of its
Subsidiaries not in accordance with GAAP.
(b) QUARTERLY FINANCIAL STATEMENTS. As soon as practicable and in any
event within forty-five (45) days after the end of each fiscal quarter, an
unaudited Consolidated balance sheet of the Borrower and its Subsidiaries as of
the close of such fiscal quarter and unaudited Consolidated statements of
income, retained earnings and cash flows for the fiscal quarter then ended and
that portion of the Fiscal Year then ended, including the notes thereto, all in
reasonable detail setting forth in comparative form the corresponding figures
for the preceding Fiscal Year and prepared by the Borrower in accordance with
GAAP and, if applicable, containing disclosure of the effect on the financial
position or results of operations of any change in the application of accounting
principles and practices during the period, and certified by the chief financial
officer of the Borrower to present fairly in all material respects the financial
condition of the Borrower and its Subsidiaries as of their respective dates and
the results of operations of the Borrower and its Subsidiaries for the
respective periods then ended, subject to audit and normal year-end adjustments.
(c) OPERATING BUDGET AND CASH FLOW PROJECTIONS. As soon as practicable
and in any event not later than 30 days prior to the end of each Fiscal Year, an
annual operating budget together with annual cash flow projections of the
Borrower and its Subsidiaries for the upcoming Fiscal Year, each in form and
substance reasonably satisfactory to the Agent.
(d) OTHER FINANCIAL INFORMATION. Promptly upon receipt thereof, copies
of all reports, if any, submitted to any Credit Party or its member committee by
its independent public accountants in connection with their auditing function,
including, without limitation, any management report and any management
responses thereto and such other information regarding the operations, business
affairs and financial condition of the Borrower or any of its Subsidiaries as
the Agent or the Required Lenders may reasonably request.
SECTION 12.2......OFFICER'S COMPLIANCE CERTIFICATE.
At each time financial statements are delivered pursuant to Section
7.1(a) or (b), a certificate of the chief financial officer of the Borrower in
the form of EXHIBIT E attached hereto (an "Officer's Compliance Certificate"):
(a) stating that such officer has reviewed such financial statements
and such statements fairly present in all material respects the financial
condition of the Borrower and its Subsidiaries as of the dates indicated and the
results of its operations and cash flows for the periods indicated;
(b) stating that to the best of such officer's knowledge, based on a
reasonable examination sufficient to enable him to make an informed statement,
no Default or Event of Default exists, or, if such is not the case, specifying
such Default or Event of Default and its
53
nature, when it occurred, whether it is continuing and the steps being taken by
the Credit Parties with respect to such Default or Event of Default; and
(c) setting forth as at the end of such fiscal quarter or Fiscal Year,
as the case may be, the calculations required to establish whether or not the
Borrower and its Subsidiaries were in compliance with the financial covenants
set forth in ARTICLE IX hereof as at the end of each respective period.
SECTION 12.3 NOTICE OF LITIGATION AND OTHER MATTERS.
(a) Promptly (but in no event later than five (5) days after an officer
of any Credit Party obtains knowledge thereof), telephonic and written notice
of:
(i) the commencement of all proceedings and investigations by
or before any Governmental Authority and all actions and proceedings in
any court or before any arbitrator against or involving the Borrower or
any Subsidiary thereof or any of their respective properties, assets or
businesses which in any such case could reasonably be expected to have
a Material Adverse Effect;
(ii) any notice of any violation received by the Borrower or
any Subsidiary thereof from any Governmental Authority including,
without limitation, any notice of violation of Environmental Laws,
which in any such case could reasonably be expected to have a Material
Adverse Effect;
(iii) any labor controversy that has resulted in, or threatens
to result in, a strike or other work action against the Borrower or any
Subsidiary thereof which in any such case could reasonably be expected
to have a Material Adverse Effect;
(iv) any Reportable Event or "prohibited transaction", as such
term is defined in Section 406 of ERISA or Section 4975 of the Code, in
connection with any Employee Benefit Plan or any trust created
thereunder which could reasonably be expected to result in liability of
the Borrower or any ERISA Affiliate in an aggregate amount exceeding
$250,000, along with a description of the nature thereof, what action
Credit Parties have taken, are taking or propose to take with respect
thereto and, when known, any action taken or threatened by the Internal
Revenue Service, the Department of Labor or the PBGC with respect
thereto; and
(v) any event which (A) makes any of the representations set
forth in Section 6.1 inaccurate in any material respect or (B) could
reasonably be expected to have a Material Adverse Effect.
(b) Promptly upon transmission or receipt thereof, copies of
any filings and registrations with, and reports to or from (A) the
Securities and Exchange Commission, or any successor agency or (B) the
United States Occupational Health and Safety
54
Administration, or any state or local agency responsible for health and
safety matters, or an successor agencies.
SECTION 12.4 ACCURACY OF INFORMATION.
All written information, reports, statements and other papers and data
furnished by or on behalf of the Credit Parties to the Lenders (other than
financial forecasts) whether pursuant to this ARTICLE VII or any other provision
of this Agreement or any of the other Credit Documents, shall be, at the time
the same is so furnished, and taken as a whole, true and correct in all material
respects to the extent necessary to give the Lenders true and accurate knowledge
of the subject matter based on the Credit Parties' knowledge thereof.
ARTICLE XIII
AFFIRMATIVE COVENANTS
Until payment in full by the Borrower of all principal of and interest
on the Loans and all other amounts due hereunder and under the other Credit
Documents at the time of such payment, and the termination of the Commitments,
each Credit Party will, and will cause each of its Subsidiaries to:
SECTION 13.1 PRESERVATION OF CORPORATE EXISTENCE AND RELATED
MATTERS.
Except as permitted by Section 10.4, preserve and maintain its separate
corporate existence and all rights, franchises, licenses and privileges
necessary to the conduct of its business and qualify and remain qualified as a
foreign corporation and authorized to do business in each jurisdiction in which
it is required to be so qualified, except where the failure to be so qualified
and authorized could not reasonably be expected to have a Material Adverse
Effect.
SECTION 13.2 MAINTENANCE OF PROPERTY.
Protect and preserve all properties useful in and material to its
business, including copyrights, patents, trade names and trademarks; maintain in
good working order and condition all buildings, equipment and other tangible
real and personal property; and from time to time make or cause to be made all
renewals, replacements and additions to such property necessary for the conduct
of its business, so that the business carried on in connection therewith may be
properly and advantageously conducted at all times.
SECTION 13.3 INSURANCE.
Maintain insurance with financially sound and reputable insurance
companies against such risks and in such amounts as are customarily maintained
by similar businesses and as may be required by Applicable Law, and on the
Closing Date and from time to time thereafter deliver to the Agent, on behalf of
the Lenders, upon its request a detailed list of the insurance then in effect,
stating the names of the insurance companies, the amounts and rates of the
insurance, the
55
dates of the expiration thereof and the properties and risks covered thereby.
The Agent shall be named as loss payee, as its interest may appear, and/or as
additional insured with respect to any such insurance providing coverage in
respect of any Collateral, and each provider of any such insurance shall agree,
by endorsement upon the policy or policies issued by it or by independent
instruments furnished to the Agent, that it will give the Agent thirty (30) days
prior written notice before any such policy or policies shall be materially
altered or canceled, and that no act or default of the Borrower or any of its
Subsidiaries or any other Person shall affect the rights of the Agent under such
policy or policies.
SECTION 13.4 ACCOUNTING METHODS AND FINANCIAL RECORDS.
Maintain a system of accounting, and keep such books, records and
accounts (which shall be true and complete in all material respects) as may be
required or as may be necessary to permit the preparation of financial
statements in accordance with GAAP and in material compliance with the
regulations of any Governmental Authority having jurisdiction over it or any of
its properties.
SECTION 13.5 PAYMENT AND PERFORMANCE OF OBLIGATIONS.
Pay and perform all obligations under this Agreement and the other
Credit Documents, and pay or perform (a) all taxes, assessments and other
governmental charges that may be levied or assessed upon it or any of its
property and (b) all other Debt in accordance with its terms (subject to any
applicable subordination provisions); PROVIDED, that such Credit Party or such
Subsidiary may contest any item described in clause (a) and (b) of this Section
8.5 in good faith so long as adequate reserves are maintained with respect
thereto in accordance with GAAP.
SECTION 13.6 COMPLIANCE WITH LAWS, APPROVALS AND AGREEMENTS.
Observe and remain in compliance with all Applicable Laws; maintain in
full force and effect all Governmental Approvals; and observe and remain in
compliance with all material agreements, in each case applicable to the conduct
of its business and in each case except to the extent the failure to do so could
not reasonably be expected to have a Material Adverse Effect.
SECTION 13.7 ENVIRONMENTAL MANAGEMENT.
In addition to and without limiting the generality of Section 8.6, (a)
comply with, and ensure such compliance by all tenants, subtenants and other
occupants of the properties of the Borrower or its Subsidiaries for whatever
reason, if any, with, all applicable Environmental Laws and obtain and comply
with and maintain, and ensure that all tenants, subtenants and other occupants
of such properties for whatever reason obtain and comply with and maintain, any
and all licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws; (b) promptly conduct and complete, or cause to be
conducted and completed, all investigations, studies, sampling and testing, and
all remedial, removal and other actions required under Environmental Laws, and
promptly comply with all lawful orders and directives of any Governmental
Authority regarding Environmental Laws except to the extent the
56
Credit Party contests in good faith the orders and directives, and (c) defend,
indemnify and hold harmless the Agent, the Lenders, their Subsidiaries,
Affiliates, employees, agents, officers, directors, successors and assigns from
and against any claims, demands, penalties, fines, liabilities, settlements,
damages, costs and expenses of whatever kind or nature known or unknown,
contingent or otherwise, arising out of, or in any way relating to the violation
of, noncompliance with or liability under any Environmental Laws applicable to
the operations of the Borrower or its Subsidiaries, or the current, future or
former ownership or operation of such properties, activities thereon and actions
taken in relation thereto including, without limitation, all liability now
existing or which may arise in the future as a result of the release,
transportation or disposal of any Hazardous Material from such properties to or
at any location, or any orders, requirements or demands of Governmental
Authorities related thereto, including, without limitation, reasonable
attorneys' and consultants' fees, investigation and laboratory fees, response
costs, court costs and litigation expenses, except to the extent that any of the
foregoing arise out of the gross negligence or willful misconduct of the party
seeking indemnification therefor.
SECTION 13.8 COMPLIANCE WITH ERISA.
In addition to and without limiting the generality of Section 8.6, (a)
comply in all material respects with all applicable provisions of ERISA and the
regulations and published interpretations thereunder with respect to all
Employee Benefit Plans, (b) not take any action or fail to take action the
result of which could be a material liability to the PBGC or to a Multiemployer
Plan, and not participate in any prohibited transaction that could result in any
material civil penalty under ERISA or tax under the Code and (c) furnish to any
Lenders upon any Lender's request such additional information about any Employee
Benefit Plan or Multiemployer Plan as may be reasonably requested by such
Lender.
SECTION 13.9 CONDUCT OF BUSINESS.
Engage only in the business of manufacturing, reprocessing and
distribution of medical products and supplies and in lines of business
reasonably related thereto.
SECTION 13.10 VISITS AND INSPECTIONS.
Permit representatives of the Agent, from time to time, to visit and
inspect its properties; inspect, audit and make extracts from its books, records
and files, including, but not limited to, management letters prepared by
independent accountants; and discuss with its principal officers, and its
independent accountants, its business, assets, liabilities, financial condition,
results of operations and business prospects; PROVIDED, that all such visits and
inspections shall be at reasonable times during ordinary business hours, with
reasonable notice to the Credit Parties and shall be at the Credit Parties'
expense.
SECTION 13.11 [RESERVED.]
57
SECTION 13.12 MATERIAL CONTRACTS.
Perform, and cause each of its Subsidiaries to perform, each of its
obligations under its Material Contracts, except to the extent the Credit Party
contests in good faith its obligation to perform those obligations.
SECTION 13.13 FURTHER ASSURANCES.
Make, execute and deliver all such additional and further acts, things,
deeds and instruments as the Agent or the Required Lenders may reasonably
require to document and consummate the transactions contemplated hereby and to
vest completely in and insure the Lenders their rights under this Credit
Agreement, the Notes, and the other Credit Documents.
SECTION 13.14 SECURITY INTERESTS.
(a) Cause all of the Collateral (to the extent deemed material by the
Agent and the Required Lenders) to be subject to a first priority security
interest in favor of the Collateral Agent, for the benefit of the Lenders,
subject to Permitted Liens.
(b) Defend the Collateral against all claims and demands of all Persons
at any time claiming the same or any interest therein. The Credit Parties agree
to comply with the requirements of all state and federal laws in order to grant
to the Collateral Agent a valid and perfected first security interest in the
Collateral. The Collateral Agent is hereby authorized by the Credit Parties to
file any financing statements covering the Collateral whether or not the
applicable Credit Party's signature appears thereon. The Credit Parties agree to
do whatever the Agent may reasonably request, from time to time, by way of:
filing notices of liens, financing statements, fixture filings and amendments,
renewals and continuations thereof; cooperating with the Agent's custodians;
keeping stock records; obtaining waivers from landlords and mortgagees; paying
claims, which might if unpaid, become a Lien (other than a Permitted Lien) on
the Collateral; and performing such further acts as the Agent may reasonably
require in order to effect the purposes of this Agreement and the other Credit
Documents. Any and all fees, costs and expenses of whatever kind and nature
(including any Taxes, reasonable attorneys' fees or costs for insurance of any
kind), which the Agent may incur with respect to the Collateral or the
Obligations: in filing public notices; in preparing or filing documents; making
title examinations or rendering opinions; in protecting, maintaining, or
preserving the Collateral or its interest therein; in enforcing or foreclosing
the Liens hereunder, whether through judicial procedures or otherwise; or in
defending or prosecuting any actions or proceedings arising out of or relating
to its transactions with the Credit Parties under this Agreement or any other
Credit Document, will be borne and paid by the Credit Parties. If same are not
promptly paid by the Credit Parties, the Agent may pay same on the Credit
Parties' behalf, and the amount thereof shall be an Obligation secured hereby
and due to the Agent on demand.
58
SECTION 13.15 ADDITIONAL GUARANTORS.
Cause each of their domestic Subsidiaries, whether newly formed, after
acquired or otherwise existing, to promptly become a "Guarantor" hereunder by
way of execution of a Joinder Agreement. The guaranty obligations of any such
Additional Credit Party shall be secured by, among other things, the Collateral
of such Additional Credit Party and a pledge of 100% of the Capital Stock of its
domestic Subsidiaries and 65% of the Capital Stock of its foreign Subsidiaries
to the extent that such pledge is permissible under applicable law. Each Credit
Party shall pledge to the Collateral Agent, for the benefit of the Lenders, 100%
of the Capital Stock of each of its domestic Subsidiaries and 65% the Capital
Stock of each of its foreign Subsidiaries.
ARTICLE XIV
FINANCIAL COVENANTS
Until payment in full by the Borrower of all principal of and interest
on the Loans and all other amounts due hereunder and under the other Credit
Documents at the time of such payment, and the termination of the Commitments,
the Borrower will not:
SECTION 14.1 MINIMUM CONSOLIDATED NET WORTH.
Permit, at any time, Consolidated Net Worth to be less than the sum of
(a) $37,000,000 PLUS (b) seventy-five percent (75%) of cumulative Consolidated
Net Income (to the extent positive) for each fiscal quarter beginning with the
fiscal quarter ending March 31, 2000.
SECTION 14.2 CONSOLIDATED LEVERAGE RATIO.
Permit, as of any fiscal quarter end for the periods shown below, the
Consolidated Leverage Ratio as of the last day of each such fiscal quarter to
exceed 2.5 to 1.0.
SECTION 14.3 FIXED CHARGE COVERAGE RATIO.
Permit, as of any fiscal quarter end for the periods shown below, the
Fixed Charge Coverage Ratio, as of the last day of each such fiscal quarter, to
be less than 2.8 to 1.0.
ARTICLE XV
NEGATIVE COVENANTS
Until payment in full by the Borrower of all principal of and interest
on the Loans and all other amounts due hereunder and under the other Credit
Documents at the time of such payment, and the termination of the Commitments,
the Credit Parties will not and will not permit any of their Subsidiaries to:
59
SECTION 15.1 LIMITATIONS ON DEBT.
Create, incur, assume or suffer to exist any Debt except:
(a) the Obligations and the obligations of the Credit Parties under the
ELLF Operative Agreements;
(b) Debt incurred in connection with a Hedging Agreement with a
counterparty and upon terms and conditions reasonably satisfactory to the
Required Lenders;
(c) Contingent Obligations in favor of the Agent on behalf of the
Lenders;
(d) Purchase Money Debt of the Borrower and its Subsidiaries in an
aggregate amount outstanding at any time not to exceed $500,000;
(e) Debt existing on the Closing Date identified on Schedule 6.1(p);
and
(f) letters of credit issued by any Lender, PROVIDED THAT (i) the face
amount of any such letter of credit is less than $100,000 and (ii) the aggregate
face amount of all such letters of credit does not exceed $250,000.
SECTION 15.2 LIMITATIONS ON LIENS.
Create, incur, assume or suffer to exist, any Lien on or with respect
to any of its assets or properties (including specifically shares of Capital
Stock of any Subsidiary), real or personal, whether now owned or hereafter
acquired, except for the following (collectively, "Permitted Liens"):
(a) Liens for taxes, assessments and other governmental charges or
levies (excluding any Lien imposed pursuant to any of the provisions of ERISA or
Environmental Laws) not yet due or as to which the period of grace (not to
exceed thirty (30) days), if any, related thereto has not expired or which are
being contested in good faith and by appropriate proceedings if adequate
reserves are maintained to the extent required by GAAP;
(b) the claims of materialmen, mechanics, carriers, warehousemen,
processors or landlords for labor, materials, supplies or rentals incurred in
the ordinary course of business, (i) which are not overdue for a period of more
than thirty (30) days or (ii) which are being contested in good faith and by
appropriate proceedings if adequate reserves are maintained to the extent
required by GAAP;
(c) Liens consisting of deposits or pledges made in the ordinary course
of business (i) in connection with or to secure a payment of, obligations under
workers' compensation, unemployment insurance or similar legislation or (ii) to
secure the performance of letters of credit, bids, tenders, sales contracts,
leases, statutory obligations, surety, appeal and performance
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bonds and other similar obligations, in each case not incurred in connection
with the borrowing of money or the payment of the deferred purchase price of
property;
(d) Liens constituting encumbrances in the nature of zoning
restrictions, easements and rights or restrictions of record on the use of real
property, which in the aggregate are not substantial in amount and which do not,
in any case, materially detract from the value of such property or impair the
use thereof in the ordinary conduct of business;
(e) Liens in favor of the Agent created pursuant to the Credit
Documents and the ELLF Operative Agreements;
(f) Liens securing Purchase Money Debt permitted under Section 10.1(d)
in an amount not to exceed $500,000 at any time outstanding; PROVIDED, that the
Lien attaches only to the asset being purchased or leased and does not exceed
100% of the purchase price or fair market value of such asset at the time of
acquisition;
(g) Liens existing on the Closing Date identified on Schedule 6.1(p);
and
(h) attachment, judgment and similar Liens arising in connection with
court proceedings other than any such Lien which would create an Event of
Default under Sections 11.1(j) or 11.1(k).
SECTION 15.3 LIMITATIONS ON LOANS, ADVANCES, INVESTMENTS AND
ACQUISITIONS.
Purchase, own, invest in or otherwise acquire, directly or indirectly,
any capital stock, interests in any partnership or joint venture, evidence of
Debt or other obligation or security, substantially all or a portion of the
business or assets of any other Person or any other investment or interest
whatsoever in any other Person; or make or permit to exist, directly or
indirectly, any loans, advances or extensions of credit to, or any investment in
cash or by delivery of property in, any Person; or enter into, directly or
indirectly, any commitment or option in respect of the foregoing except:
(a) loans and advances to employees for reasonable travel, relocation
and business expenses in the ordinary course of business;
(b) deposits for utilities, security deposits, leases and similar
prepaid expenses incurred in the ordinary course of business;
(c) trade accounts created in the ordinary course of business; and
(d) other investments of the Credit Parties not exceeding $1,000,000
per annum.
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SECTION 15.4 LIMITATIONS ON MERGERS AND LIQUIDATION.
Merge, consolidate or enter into any similar combination with any other
Person or liquidate, wind-up or dissolve itself (or suffer any liquidation or
dissolution).
SECTION 15.5 LIMITATIONS ON SALE OF ASSETS.
Convey, sell, lease, assign, transfer or otherwise dispose of any of
its property, business or assets (including, without limitation, the sale of any
receivables and leasehold interests and any sale-leaseback or similar
transaction), whether now owned or hereafter acquired, except:
(a) the sale or other disposition of assets no longer necessary in the
business of the Borrower or such Subsidiary;
(b) the sale of inventory in the ordinary course of business; and
(c) other sales, leases, assignments, transfers or dispositions of
property, business or assets not to exceed $100,000 in the aggregate.
SECTION 15.6 TRANSACTIONS WITH AFFILIATES.
Except as otherwise permitted hereunder, directly or indirectly: (a)
except in accordance with the terms of clause (b) below, subcontract any
operations to any of its Affiliates or enter into any arrangements with its
Affiliates for the provision to any Credit Party of services in the nature of
accounting and legal support, merchandising, catering and other related services
or (b) enter into, or be a party to, any transaction with any of its Affiliates,
except pursuant to the reasonable requirements of its business and upon fair and
reasonable terms that are no less favorable to it than it would obtain in a
comparable arm's length transaction with a Person not its Affiliate.
SECTION 15.7 CERTAIN ACCOUNTING CHANGES.
Change its Fiscal Year end, or make any material change in its
accounting treatment and reporting practices except for a change required by
GAAP or a change that is permitted by GAAP and disclosed to Lender.
SECTION 15.8 NO RESTRICTED PAYMENTS.
Make a Restricted Payment other than (a) the payments of dividends from
any Subsidiary to the Borrower and (b) so long as no Default or Event of Default
shall exist immediately prior to or immediately after the making of any such
permitted Restricted Payment, (i) the payment in each fiscal quarter of up to
$55,000 as dividends on the Borrower's Series A Preferred Stock and (ii) the
repurchase by the Borrower of outstanding common shares of its Capital Stock for
an aggregate purchase price not to exceed $5,000,000.
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SECTION 15.9 [INTENTIONALLY OMITTED]
SECTION 15.10 ADDITIONAL NEGATIVE PLEDGES.
Create or otherwise suffer to exist or become effective, directly or
indirectly, (a) any prohibition or restriction (including any agreement to
provide equal and ratable security to any other Person in the event a Lien is
granted to or for the benefit of the Lenders) on the creation or existence of
any Lien upon the assets of the Borrower or the Subsidiaries, other than
Permitted Liens or (b) any contractual obligation which may restrict or limit
the Lenders' rights or ability to sell or otherwise dispose of the Collateral or
any part thereof after the occurrence of an Event of Default.
SECTION 15.11 SALE AND LEASEBACK.
Enter into any arrangement, directly or indirectly, whereby such Credit
Party or any of its Subsidiaries shall sell or transfer any property owned by it
to a Person (other than the Borrower or any Subsidiary) in order then or
thereafter to lease such property or lease other property which the Borrower or
any Subsidiary intends to use for substantially the same purpose as the property
being sold or transferred.
SECTION 15.12 LICENSES, ETC.
Enter into licenses of, or otherwise restrict the use of, any patents,
trademarks or copyrights which would prevent such Person from selling,
transferring, encumbering or otherwise disposing of any such patent, trademark
or copyright.
SECTION 15.13 LIMITATIONS.
Directly or indirectly, create or otherwise cause, incur, assume,
suffer or permit to exist or become effective any consensual encumbrance or
restriction of any kind on the ability of any such Person to (a) pay dividends
or make any other distribution on any of such Person's Capital Stock or (b) pay
any Debt owed to the Borrower, except for encumbrances or restrictions existing
under or by reason of (i) customary non-assignment provisions in any lease
governing a leasehold interest, and (ii) this Agreement and the other Credit
Documents.
SECTION 15.14 AMENDMENTS; PAYMENTS AND PREPAYMENTS OF SUBORDINATED
DEBT.
(a) Amend or modify (or permit the modification or amendment of) any of
the terms or provisions of any Debt subordinated to the Obligations or (b)
cancel or forgive, make any voluntary or optional or mandatory payment or
prepayment on, make any payment of interest on, or redeem or acquire for value
(including without limitation by way of depositing with any trustee with respect
thereto money or securities before due for the purpose of paying when due) any
subordinated Debt.
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ARTICLE XVI
DEFAULT AND REMEDIES
SECTION 16.1 EVENTS OF DEFAULT.
Each of the following shall constitute an Event of Default, whatever
the reason for such event and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment or order of any court
or any order, rule or regulation of any Governmental Authority or otherwise:
(a) DEFAULT IN PAYMENT OF PRINCIPAL OF LOANS AND LOC OBLIGATIONS. Any
Credit Party shall (i) default in any payment of principal of any Loan or the
Notes when and as due (whether at maturity, by reason of acceleration or
otherwise) or (ii) fail to reimburse the Issuing Lender for any LOC Obligations
when due in accordance with the terms hereof.
(b) OTHER PAYMENT DEFAULT. Any Credit Party shall default in the
payment when and as due (whether at maturity, by reason of acceleration or
otherwise) of interest on any Loan or the Notes or the payment of any other
Obligations and such amount shall remain unpaid for a period of five (5)
Business Days following the due date thereof.
(c) MISREPRESENTATION. Any representation or warranty made or deemed to
be made by any Credit Party under this Agreement, any Credit Document or any
amendment hereto or thereto, shall at any time prove to have been incorrect or
misleading in any material respect when made or deemed made.
(d) DEFAULT IN PERFORMANCE OF CERTAIN COVENANTS. Any Credit Party shall
default in the performance or observance of any covenant or agreement (i)
contained in Sections 7.1, 7.2 or 7.3(a) and such default shall continue
unremedied for a period of ten (10) Business Days or (ii) contained in Sections
8.9, 8.10 or ARTICLES IX or X of this Agreement.
(e) DEFAULT IN PERFORMANCE OF OTHER COVENANTS AND CONDITIONS. Any
Credit Party shall default in the performance or observance of any term,
covenant, condition or agreement contained in this Agreement (other than as
specifically provided for otherwise in this Section 11.1) or any other Credit
Document and such default shall continue for a period of thirty (30) days
following notice from the Lenders of its occurrence.
(f) HEDGING AGREEMENT. Any termination payment shall be due from any
Credit Party under any Hedging Agreement and such amount is not paid within ten
(10) Business Days after the due date thereof.
(g) DEBT CROSS-DEFAULT. The Borrower or any of its Subsidiaries shall
(i) default in the payment of any Debt (other than the Notes) the aggregate
outstanding amount of which is in excess of $100,000 beyond the period of grace
if any, provided in the instrument or agreement under which such Debt was
created or (ii) default in the observance or performance of any other
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agreement or condition relating to any Debt (other than the Notes) the aggregate
outstanding amount of which is in excess of $100,000 or contained in any
instrument or agreement evidencing, securing or relating thereto 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 Debt (or a
trustee or agent on behalf of such holder or holders) to cause, with the giving
of notice if required, any such Debt to become due prior to its stated maturity
(any applicable grace period having expired).
(h) VOLUNTARY BANKRUPTCY PROCEEDING. The Borrower or any Subsidiary
thereof shall (i) commence a voluntary case under the federal bankruptcy laws
(as now or hereafter in effect), (ii) file a petition seeking to take advantage
of any other laws, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding up or composition for adjustment of debts, (iii) consent
to or fail to contest in a timely and appropriate manner any petition filed
against it in an involuntary case under such bankruptcy laws or other laws, (iv)
apply for or consent to, or fail to contest in a timely and appropriate manner,
the appointment of, or the taking of possession by, a receiver, custodian,
trustee, or liquidator of itself or of a substantial part of its property,
domestic or foreign, (v) admit in writing its inability to pay its debts as they
become due, (vi) make a general assignment for the benefit of creditors or (vii)
take any corporate action for the purpose of authorizing any of the foregoing.
(i) INVOLUNTARY BANKRUPTCY PROCEEDING. A case or other proceeding shall
be commenced against the Borrower or any Subsidiary thereof in any court of
competent jurisdiction seeking (i) relief under the federal bankruptcy laws (as
now or hereafter in effect) or under any other laws, domestic or foreign,
relating to bankruptcy, insolvency, reorganization, winding up or adjustment of
debts or (ii) the appointment of a trustee, receiver, custodian, liquidator or
the like for the Borrower or any Subsidiary thereof or for all or any
substantial part of their respective assets, domestic or foreign, and such case
or proceeding shall continue undismissed or unstayed for a period of sixty (60)
consecutive calendar days, or an order granting the relief requested in such
case or proceeding (including, but not limited to, an order for relief under
such federal bankruptcy laws) shall be entered.
(j) JUDGMENT. A judgment or order for the payment of money which
exceeds $100,000 in amount shall be entered against the Borrower or any of its
Subsidiaries by any court and such judgment or order shall continue undischarged
or unstayed for a period of thirty (30) days.
(k) ATTACHMENT. A warrant or writ of attachment or execution or similar
process shall be issued against any property of the Borrower or any of its
Subsidiaries which exceeds $100,000 in value and such warrant or process shall
continue undischarged or unstayed for a period of thirty (30) days.
(l) NONCOMPLIANCE WITH ENVIRONMENTAL LAWS. The Borrower or any of its
Subsidiaries or Affiliates shall be found by any applicable Governmental
Authority to be in violation of or liable under any material requirement of
Environmental Law which could reasonably be expected to have a Material Adverse
Effect unless (i) such finding is being
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contested in good faith, (ii) adequate reserves with respect thereto are
maintained by such Person in accordance with GAAP and (iii) there is no
violation of the terms and provisions of this Agreement or any of the other
Credit Documents resulting therefrom or arising with respect thereto.
(m) CHANGE IN CONTROL. A Change in Control shall occur.
(n) VALIDITY. Any covenant, agreement or obligation of any party
contained in or evidenced by any of the Credit Documents shall cease to be
enforceable in accordance with its terms, or any party (other than the Agent or
the Lenders) to any Credit Document shall deny or disaffirm its obligations
under any of the Credit Documents, or any Credit Document shall be canceled,
terminated, revoked or rescinded without the express prior written consent of
the Agent, or any action or proceeding shall have been commenced by any Person
(other than the Agent or any Lender) seeking to cancel, revoke, rescind or
disaffirm the obligations of any party to any Credit Document, or any court or
other governmental authority shall issue a judgment, order, decree or ruling to
the effect that any of the obligations of any party to any Credit Document are
illegal, invalid or unenforceable, or the Liens created under the Security
Agreement or the Pledge Agreements shall cease to be first priority perfected
Liens.
(o) DEFAULT UNDER ELLF PARTICIPATION AGREEMENT. A "default" or "event
of default" as defined in the ELLF Participation Agreement shall occur.
SECTION 16.2 REMEDIES.
Upon the occurrence of an Event of Default, the Agent shall, upon the
written request of the Required Lenders, and by delivery of written notice to
the Borrower from the Agent, without prejudice to the rights of the Agent, any
Lender or the holder of any Note to enforce its claims against the Borrower:
(a) ACCELERATION; TERMINATION OF AGREEMENT. Declare the principal of
and interest on the Loans, the Notes at the time outstanding, and all other
amounts owed to the Agent and the Lenders under this Agreement or any of the
other Credit Documents and all other Obligations (including without limitation
the maximum amount of all contingent liabilities under Letters of Credit), to be
forthwith due and payable, whereupon the same shall immediately become due and
payable without presentment, demand, protest or other notice of the Agent or any
Lender of any kind, all of which are expressly waived, anything in this
Agreement or the other Credit Documents to the contrary notwithstanding, and
terminate this Agreement, the outstanding Commitments and any right of the
Borrower to request borrowings hereunder; PROVIDED, that upon the occurrence of
an Event of Default specified in Section 11.1(h) or (i), this Agreement and the
outstanding Commitments shall be automatically terminated and all Obligations
shall automatically become due and payable.
(b) CASH COLLATERALIZATION OF LETTERS OF CREDIT. Direct the Borrower to
pay to the Agent cash collateral as security for the LOC Obligations for
subsequent drawings under then outstanding Letters of Credit an amount equal to
the maximum amount of which may be drawn
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under Letters of Credit then outstanding, whereupon the same shall immediately
become due and payable.
(c) RIGHTS OF COLLECTION. Exercise all of its other rights and remedies
under this Agreement, the other Credit Documents and Applicable Law, including,
without limitation, all rights of set-off, in order to satisfy all of the
Borrower's Obligations.
SECTION 16.3 RIGHTS AND REMEDIES CUMULATIVE; NON-WAIVER; ETC.
The enumeration of the rights and remedies of the Agent and the Lenders
set forth in this Agreement is not intended to be exhaustive and the exercise by
the Agent or any Lender of any right or remedy shall not preclude the exercise
of any other rights or remedies, all of which shall be cumulative, and shall be
in addition to any other right or remedy given hereunder or under the Credit
Documents or that may now or hereafter exist in law or in equity or by suit or
otherwise. No delay or failure to take action on the part of the Agent or any
Lender in exercising any right, power or privilege shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right, power or
privilege preclude other or further exercise thereof or the exercise of any
other right, power or privilege or shall be construed to be a waiver of any
Event of Default. No course of dealing between the Credit Parties, the Agent and
the Lenders or their respective agents or employees shall be effective to
change, modify or discharge any provision of this Agreement or any of the other
Credit Documents or to constitute a waiver of any Event of Default.
SECTION 16.4 CREDITING OF PAYMENTS AND PROCEEDS.
In the event that the Credit Parties shall fail to pay any of the
Obligations when due and the Obligations have been accelerated pursuant to
Section 11.2, then during the continuance of any such Event of Default all
payments received by the Lenders upon the Notes and the other Obligations and
all net proceeds from the enforcement of the obligations shall be applied first
to all expenses then due and payable by the Credit Parties hereunder, then to
all indemnity obligations then due and payable by the Credit Parties hereunder,
then to all Fees payable to the Agent and the Lenders then due and payable, then
to all facility and other fees and commissions then due and payable, then to
accrued and unpaid interest on the Notes and any termination payments due in
respect of a Hedging Agreement (PRO RATA in accordance with all such amounts
due), and then to the principal amount outstanding under the Notes, in that
order.
ARTICLE XVII
THE AGENT
SECTION 17.1 APPOINTMENT OF AGENT.
(a) Each Lender hereby designates First Union as Agent to act as herein
specified. Each Lender hereby irrevocably authorizes, and each holder of any
Note by the acceptance of a Note or participation shall be deemed irrevocably to
authorize, the Agent to take such action on its behalf under the provisions of
this Credit Agreement and the Notes and any other instruments
67
and agreements referred to herein and to exercise such powers and to perform
such duties hereunder and thereunder as are specifically delegated to or
required of the Agent by the terms hereof and thereof and such other powers as
are reasonably incidental thereto. The Agent shall hold all payments of
principal, interest, Fees, charges and expenses received pursuant to this Credit
Agreement or any other Credit Document for the ratable benefit of the Lenders.
The Agent may perform any of its duties hereunder by or through its agents or
employees.
(b) The provisions of this ARTICLE XII are solely for the benefit of
the Agent and the Lenders, and the Credit Parties shall have no rights as a
third party beneficiary of any of the provisions hereof (other than Section
12.9). In performing its functions and duties under this Credit Agreement, the
Agent shall act solely as agent of the Lenders and does not assume and shall not
be deemed to have assumed any obligation toward or relationship of agency or
trust with or for the Credit Parties.
SECTION 17.2 NATURE OF DUTIES OF AGENT.
The Agent shall have no duties or responsibilities except those
expressly set forth in this Credit Agreement. Neither the Agent nor any of its
officers, directors, employees or agents shall be liable for any action taken or
omitted by it as such hereunder or in connection herewith, unless caused by its
or their gross negligence or willful misconduct. The duties of the Agent shall
be mechanical and administrative in nature; the Agent shall not have by reason
of this Credit Agreement a fiduciary relationship in respect of any Lender; and
nothing in this Credit Agreement, expressed or implied, is intended to or shall
be so construed as to impose upon the Agent any obligations in respect of this
Credit Agreement except as expressly set forth herein.
SECTION 17.3 LACK OF RELIANCE ON AGENT.
(a) Independently and without reliance upon the Agent, each Lender, to
the extent it deems appropriate, has made and shall continue to make (i) its own
independent investigation of the financial or other condition and affairs of the
Borrower and the other Credit Parties in connection with the taking or not
taking of any action in connection herewith and (ii) its own appraisal of the
creditworthiness of the Borrower and the Credit Parties, and, except as
expressly provided in this Credit Agreement, the Agent shall have no duty or
responsibility, either initially or on a continuing basis, to provide any Lender
with any credit or other information with respect thereto, whether coming into
its possession before the making of the Loans or at any time or times
thereafter.
(b) The Agent shall not be responsible to any Lender for any recitals,
statements, information, representations or warranties herein or in any
document, certificate or other writing delivered in connection herewith or for
the execution, effectiveness, genuineness, validity, enforceability,
collectability, priority or sufficiency of this Credit Agreement or the Notes or
the financial or other condition of the Borrower and the other Credit Parties.
The Agent shall not be required to make any inquiry concerning either the
performance or observance of any of the terms, provisions or conditions of this
Credit Agreement or the Notes, or the financial condition
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of the Borrower, or the existence or possible existence of any Default or Event
of Default, unless specifically requested to do so in writing by any Lender.
SECTION 17.4 CERTAIN RIGHTS OF THE AGENT.
The Agent shall have the right to request instructions from the
Required Lenders or, as required, each of the Lenders. If the Agent shall
request instructions from the Required Lenders with respect to any act or action
(including the failure to act) in connection with this Credit Agreement, the
Agent shall be entitled to refrain from such act or taking such action unless
and until the Agent shall have received instructions from the Required Lenders,
and the Agent shall not incur liability to any Person by reason of so
refraining. Without limiting the foregoing, no Lender shall have any right of
action whatsoever against the Agent as a result of the Agent acting or
refraining from acting hereunder in accordance with the instructions of the
Required Lenders.
SECTION 17.5 RELIANCE BY AGENT.
The Agent shall be entitled to rely, and shall be fully protected in
relying, upon any note, writing, resolution, notice, statement, certificate or
other oral or written communication believed by it to be genuine and correct and
to have been signed, sent or made by the proper person. The Agent may consult
with legal counsel (including counsel for the Credit Parties with respect to
matters concerning the Credit Parties), independent public accountants and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken by it in good faith in accordance with the advice of such counsel,
accountants or experts.
SECTION 17.6 INDEMNIFICATION OF AGENT.
To the extent the Agent is not reimbursed and indemnified by the Credit
Parties, each Lender will reimburse and indemnify the Agent, in proportion to
its respective Commitment, for and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses
(including counsel fees and disbursements) or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by or asserted against the
Agent in performing its duties hereunder, in any way relating to or arising out
of this Credit Agreement, PROVIDED that no Lender shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the Agent's
gross negligence or willful misconduct.
SECTION 17.7 THE AGENT IN ITS INDIVIDUAL CAPACITY.
With respect to its obligation to lend under this Credit Agreement, the
Loans made by it and the Notes issued to it and all of its rights and
obligations as a Lender hereunder and under the other Credit Documents, the
Agent shall have the same rights and powers hereunder as any other Lender or
holder of a Note or participation interests and may exercise the same as though
it was not performing the duties specified herein; and the terms "Lenders",
"Required Lenders", "holders of Notes", or any similar terms shall, unless the
context clearly otherwise indicates, include the Agent in its individual
capacity. The Agent may accept deposits from, lend money
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to, acquire equity interests in, and generally engage in any kind of banking,
trust, financial advisory or other business with the Credit Parties or any
Affiliate of the Credit Parties as if it were not performing the duties
specified herein, and may accept fees and other consideration from the Credit
Parties for services in connection with this Credit Agreement and otherwise
without having to account for the same with the Lenders.
SECTION 17.8 HOLDERS OF NOTES.
The Agent may deem and treat the payee of any Note as the owner thereof
for all purposes hereof unless and until a written notice of the assignment or
transfer thereof shall have been filed with the Agent. Any request, authority or
consent of any Person who, at the time of making such request or giving such
authority or consent, is the holder of any Note, shall be conclusive and binding
on any subsequent holder, transferee or assignee of such Note or of any Note or
Notes issued in exchange therefor.
SECTION 17.9 SUCCESSOR AGENT.
(a) The Agent may, upon five (5) Business Days' notice to the Lenders
and the Borrower, resign at any time (effective upon the appointment of a
successor Agent pursuant to the provisions of this Section 12.9(a)) by giving
written notice thereof to the Lenders and the Borrower. Upon any such
resignation, the Required Lenders shall have the right, upon five (5) days'
notice, to appoint a successor Agent. If no successor Agent shall have been so
appointed by the Required Lenders, and shall have accepted such appointment,
within thirty (30) days after the retiring Agent's giving of notice of
resignation, then, upon five (5) days' notice , the retiring Agent may, on
behalf of the Lenders, appoint a successor Agent, which shall be a bank or a
trust company or other financial institution which maintains an office in the
United States, or a commercial bank organized under the laws of the United
States or of any state thereof, or any affiliate of such bank or trust company
or other financial institution which is engaged in the banking business, having
a combined capital and surplus of at least $500,000,000. Notwithstanding
anything herein to the contrary, any successor Agent (whether appointed by the
Required Lenders or the Agent) shall have been approved in writing by the
Borrower (such approval not to be unreasonably withheld).
(b) Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations under
this Credit Agreement. After any retiring Agent's resignation hereunder as
Agent, the provisions of this ARTICLE XII shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent under this Credit
Agreement.
SECTION 17.10 ACTIONS WITH RESPECT TO DEFAULTS.
In addition to the Agent's right to take actions on its own accord as
permitted under this Credit Agreement, the Agent shall take such action with
respect to a Default or Event of Default as shall be directed by the Required
Lenders; PROVIDED that, until the Agent shall have received
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such directions, the 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 and in the best interests of the Lenders.
SECTION 17.11 DELIVERY OF INFORMATION.
The Agent shall not be required to deliver to any Lender originals or
copies of any documents, instruments, notices, communications or other
information received by the Agent from the Borrower, any Subsidiary, the
Required Lenders, any Lender or any other Person under or in connection with
this Credit Agreement or any other Credit Document except (i) as specifically
provided in this Credit Agreement or any other Credit Document and (ii) as
specifically requested from time to time in writing by any Lender with respect
to a specific document instrument, notice or other written communication
received by and in the possession of the Agent at the time of receipt of such
request and then only in accordance with such specific request.
ARTICLE XVIII
MISCELLANEOUS
SECTION 18.1 NOTICES.
(a) METHOD OF COMMUNICATION. Except as otherwise provided in this
Agreement, all notices and communications hereunder shall be in writing. Any
notice shall be effective if delivered by hand delivery or sent via telecopy,
recognized overnight courier service or certified mail, return receipt
requested, and shall be presumed to be received by a party hereto (i) on the
date of delivery if delivered by hand or sent by telecopy, (ii) on the next
Business Day if sent by recognized overnight courier service and (iii) on the
third Business Day following the date sent by certified mail, return receipt
requested.
(b) ADDRESSES FOR NOTICES. Notices to any party shall be sent to it at
the following addresses, or any other address as to which all the other parties
are notified in writing.
If to the Borrower or any other Credit Party:
Sterile Recoveries, Inc.
▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
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With copies to:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ Plaza, Suite 3700
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Agent:
First Union National Bank
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to any Lender: To the address specified for such
Lender on SCHEDULE 1.1A.
(c) AGENT'S OFFICE. The Agent hereby designates its office located at
the address set forth above, or any subsequent office which shall have been
specified for such purpose by written notice to the Borrower, as the Agent's
office referred to herein, to which payments due are to be made and at which
Loans will be disbursed.
SECTION 18.2 GOVERNING LAW.
This Agreement, the Notes and the other Credit Documents, unless
otherwise expressly set forth therein, shall be governed by, construed and
enforced in accordance with the laws of the State of Florida, without reference
to the conflicts or choice of law principles thereof.
SECTION 18.3 ARBITRATION; CONSENT TO JURISDICTION AND SERVICE OF
PROCESS.
(a) Upon demand of any party hereto, whether made before or
after institution of any judicial action, any dispute, claim or
controversy arising out of or connected herewith or with the Credit
Documents ("Disputes") shall be resolved by binding arbitration as
provided herein. Disputes may include, without limitation, tort claims,
counterclaims, claims brought as class actions and claims arising
herefrom or from Credit Documents executed in the future. Arbitration
shall be conducted under the Commercial Financial Disputes Arbitration
Rules (the "Arbitration Rules") of the American Arbitration Association
and Title 9 of the U.S. Code. All arbitration hearings shall be
conducted in St. Petersburg, Pinellas County, Florida, or such other
place as agreed to in
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writing by the parties. A judgment upon the award may be entered in any
court having jurisdiction, and all decisions shall be in writing. The
panel from which all arbitrators are selected shall be comprised of
licensed attorneys having at least ten years' experience representing
parties in secured lending transactions. Notwithstanding the foregoing,
this arbitration provision does not apply to disputes under or related
to Hedging Agreements.
(b) Notwithstanding the preceding binding arbitration
provision, the Agent, on behalf of the Lenders, preserves certain
remedies that may be exercised during a Dispute. The Agent, on behalf
of the Lenders, shall have the right to proceed in any court of proper
jurisdiction or by self help to exercise or prosecute the following
remedies, as applicable: (i) all rights to foreclose against any real
or personal property or other security by exercising a power of sale
granted in the Credit Documents or under applicable law, (ii) all
rights of self help including peaceful occupation of real property and
collection of rents, set-off and peaceful possession of personal
property, (iii) obtaining provisional or ancillary remedies including
injunctive relief, sequestration, garnishment, attachment and
appointment of receiver, (iv) when applicable, a judgment by confession
of judgment and (v) other remedies. Preservation of these remedies does
not limit the power of an arbitrator to grant similar remedies that may
be requested by a party in a Dispute.
(c) By execution and delivery of this Agreement, each of the
parties hereto accepts, for itself and in connection with its
properties, generally and unconditionally, the non-exclusive
jurisdiction relating to any arbitration proceedings conducted under
the Arbitration Rules in St. Petersburg, Pinellas County, Florida and
irrevocably agrees to be bound by any final judgment rendered thereby
in connection with this Agreement from which no appeal has been taken
or is available. Each of the parties hereto irrevocably agrees that all
process in any such arbitration proceedings or otherwise may be
effected by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage prepaid, to it at its
address set forth in Section 13.1(b) herein or at such other address of
which such party shall have been notified pursuant thereto, such
service being hereby acknowledged by each party hereto to be effective
and binding service in every respect. Each party hereto irrevocably
waives any objection, including, without limitation, any objection to
the laying of venue or based on the grounds of forum non conveniens
which it may now or hereafter have to the bringing of any such action
or proceeding in any such jurisdiction. Nothing herein shall affect the
right to serve process in any other manner permitted by law.
SECTION 18.4 WAIVER OF JURY TRIAL.
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE AGENT, THE
LENDERS AND EACH CREDIT PARTY HEREBY IRREVOCABLY WAIVE THEIR RESPECTIVE RIGHTS
TO A JURY TRIAL WITH RESPECT TO ANY ACTION, CLAIM OR OTHER PROCEEDING ARISING
OUT OF ANY DISPUTE IN CONNECTION WITH THIS AGREEMENT, THE NOTES OR THE OTHER
CREDIT DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER, OR THE
PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS.
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SECTION 18.5 REVERSAL OF PAYMENTS.
To the extent any Credit Party makes a payment or payments to the
Lenders, which payments or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, state
or federal law, common law or equitable cause, then, to the extent of such
payment repaid, the Obligations or part thereof intended to be satisfied shall
be revived and continued in full force and effect as if such payment or proceeds
had not been received by the Lenders.
SECTION 18.6 INJUNCTIVE RELIEF.
The Credit Parties recognize that, in the event the Credit Parties fail
to perform, observe or discharge any of their obligations or liabilities under
this Agreement, any remedy of law may prove to be inadequate relief to the Agent
and the Lenders. Therefore, the Credit Parties agree that the Agent and the
Lenders, at the their option, shall be entitled to temporary and permanent
injunctive relief in any such case without the necessity of proving actual
damages.
SECTION 18.7 [RESERVED]
SECTION 18.8 SUCCESSORS AND ASSIGNS; PARTICIPATIONS.
(a) The Credit Parties shall not have the right to assign this Credit
Agreement or any interest herein except with the prior written consent of the
Lenders.
(b) Notwithstanding subsection (c) of this Section 13.8, nothing herein
shall restrict, prevent or prohibit any Lender from (i) pledging its Loans
hereunder to a Federal Reserve Bank in support of borrowings made by such Lender
from such Federal Reserve Bank or (ii) granting assignments or participations in
such Lender's Loans and/or Commitments hereunder to its parent company and/or to
any affiliate of such Lender or to any existing Lender or affiliate thereof. Any
Lender may make, carry or transfer Loans at, to or for the account of, any of
its branch offices or the office of an affiliate of such Lender except to the
extent such transfer would result in increased costs to the Borrower.
(c) Each Lender may, with the consent of the Agent and, prior to the
occurrence of an Event of Default hereunder, the Borrower (such consent not to
be unreasonably withheld or delayed), but without the consent of any other
Lender, assign to one or more banks or other financial institutions all or a
portion of its rights and obligations under this Credit Agreement and the Notes;
PROVIDED that
(i) for each such assignment, the parties thereto shall
execute and deliver to the Agent, for its acceptance and recording in
the Register (as defined below), an Assignment and Acceptance, together
with any Note or Notes subject to such assignment and a processing and
recordation fee of $3,500 to be paid by the assignee,
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(ii) such assignment shall be for a minimum aggregate amount
of $5,000,000, and
(iii) if such assignee is a Foreign Lender, all of the
requirements of Section 3.8(b) shall have been satisfied as a condition
to such assignment.
Upon such execution and delivery of the Assignment and Acceptance to the Agent,
from and after the date specified as the effective date in the Assignment and
Acceptance (the "Acceptance Date"), (x) the assignee thereunder shall be a party
hereto, and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, such assignee shall
have the rights and obligations of a Lender hereunder and (y) the assignor
thereunder shall, to the extent that rights and obligations hereunder have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its rights
(other than any rights it may have pursuant to Section 13.9 which will survive)
and be released from its obligations under this Credit Agreement (and, in the
case of an Assignment and Acceptance covering all or the remaining portion of an
assigning Lender's rights and obligations under this Credit Agreement, such
Lender shall cease to be a party hereto).
(d) By executing and delivering an Assignment and Acceptance, the
assignee thereunder confirms and agrees as follows: (i) other than as provided
in such Assignment and Acceptance, the assigning Lender makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Credit
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Credit Agreement, the Notes or any other instrument
or document furnished pursuant hereto, (ii) such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Credit Parties or the performance or observance by
the Credit Parties of any of their obligations under this Credit Agreement or
any other instrument or document furnished pursuant hereto, (iii) such assignee
confirms that it has received a copy of this Credit Agreement, together with
copies of the financial statements referred to in Section 7.1 and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance, (iv) such
assignee will, independently and without reliance upon the Agent, such assigning
Lender 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 decisions in
taking or not taking action under this Credit Agreement, (v) such assignee
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers under this Credit Agreement as are delegated to the
Agent by the terms hereof, together with such powers as are reasonably
incidental thereto and (vi) such assignee agrees that it will perform in
accordance with their terms all of the obligations which by the terms of this
Credit Agreement are required to be performed by it as a Lender.
(e) The Agent shall maintain at its address referred to in Section 13.1
a copy of each Assignment and Acceptance delivered to and accepted by it and a
register for the recordation of the names and addresses of the Lenders and the
Commitments of, and principal amount of the Loans owing to, each Lender from
time to time (the "Register"). The entries in the Register shall
75
be conclusive and binding for all purposes, absent manifest error, and the
Credit Parties, the Agent and the Lenders may treat each Person whose name is
recorded in the Register as a Lender hereunder for all purposes of this Credit
Agreement. The Register and copies of each Assignment and Acceptance shall be
available for inspection by the Borrower or any Lender at any reasonable time
and from time to time upon reasonable prior notice.
(f) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender, together with the Note or Notes subject to such assignment,
the Agent shall, if such Assignment and Acceptance has been completed and is in
substantially the form of EXHIBIT A hereto, (i) accept such Assignment and
Acceptance, (ii) record the information contained therein in the Register and
(iii) give prompt notice thereof to the Borrower. Within five (5) Business Days
after its receipt of such notice, the Borrower shall execute and deliver to the
Agent in exchange for the surrendered Note or Notes (which the assigning Lender
agrees to promptly deliver to the Borrower) a new Note or Notes to the order of
the assignee in an amount equal to the Commitment or Commitments assumed by it
pursuant to such Assignment and Acceptance and, if the assigning Lender has
retained a Commitment or Commitments hereunder, a new Note or Notes to the order
of the assigning Lender in an amount equal to the Commitment or Commitments
retained by it hereunder. Such new Note or Notes shall re-evidence the
indebtedness outstanding under the old Note or Notes and shall be in an
aggregate principal amount equal to the aggregate principal amount of such
surrendered Note or Notes, shall be dated the Closing Date and shall otherwise
be in substantially the form of the Note or Notes subject to such assignments.
(g) Each Lender may sell participations (without the consent of the
Agent, the Borrower or any other Lender) to one or more parties in or to all or
a portion of its rights and obligations under this Credit Agreement (including,
without limitation, all or a portion of its Commitments, the Loans owing to it
and the Note or Notes held by it); PROVIDED that (i) such Lender's obligations
under this Credit Agreement (including, without limitation, its Commitments to
the Borrower hereunder) shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iii) such Lender shall remain the holder of any such Note for all
purposes of this Credit Agreement, (iv) the Borrower, the Agent, and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Credit Agreement
and (v) such Lender shall not transfer, grant, assign or sell any participation
under which the participant shall have rights to approve any amendment or waiver
of this Credit Agreement except to the extent such amendment or waiver would (A)
extend the final Maturity Date or the date for the payments of any installment
of fees or principal or interest of any Loans in which such participant is
participating, (B) reduce the amount of any installment of principal of the
Loans in which such participant is participating, (C) except as otherwise
expressly provided in this Credit Agreement, reduce the interest rate applicable
to the Loans in which such participant is participating, or (D) except as
otherwise expressly provided in this Credit Agreement, reduce any Fees payable
hereunder.
(h) Each Lender agrees that, without the prior written consent of the
Borrower and the Agent, it will not make any assignment or sell a participation
hereunder in any manner or under
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any circumstances that would require registration or qualification of, or
filings in respect of, any Loan, Note or other Obligation under the securities
laws of the United States of America or of any jurisdiction.
(i) In connection with the efforts of any Lender to assign its rights
or obligations or to participate interests, such Lender may disclose any
information in its possession regarding the Borrower.
SECTION 18.9 PAYMENT OF EXPENSES; INDEMNIFICATION.
The Credit Parties agree to: (a) pay all reasonable out-of-pocket costs
and expenses of (i) the Agent in connection with (A) the negotiation,
preparation, execution and delivery and administration of this Credit Agreement
and the other Credit Documents and the documents and instruments referred to
therein (including, without limitation, the reasonable fees and expenses of
special counsel to the Agent and the reasonable fees and expenses of counsel for
the Agent in connection with collateral issues), and (B) any amendment, waiver
or consent relating hereto and thereto including, but not limited to, any such
amendments, waivers or consents resulting from or related to any work-out,
renegotiation or restructure relating to the performance by the Credit Parties
under this Credit Agreement and (ii) the Agent and the Lenders in connection
with enforcement of the Credit Documents and the documents and instruments
referred to therein, including, without limitation, in connection with any such
enforcement, the reasonable fees and disbursements of a single counsel for the
Agent and the Lenders. Each Credit Party shall and hereby does agree to
indemnify, defend and hold harmless the Agent and each of the Lenders and their
respective directors, officers, agents, employees and counsel from and against
(a) any and all losses, claims, damages, liabilities, deficiencies, judgments or
expenses incurred by any of them (except to the extent that it is finally
judicially determined to have resulted from their own gross negligence or
willful misconduct) arising out of or by reason of any litigation,
investigation, claim or proceeding which arises out of or is in any way related
to (i) this Credit Agreement or the transactions contemplated thereby, (ii) any
actual or proposed use by the Borrower of the proceeds of the Loans or (iii) the
Agent's or the Lenders' entering into this Credit Agreement, the other Credit
Documents or any other agreements and documents relating hereto, including,
without limitation, amounts paid in settlement, court costs and the fees and
disbursements of counsel incurred in connection with any such litigation,
investigation, claim or proceeding or any advice rendered in connection with any
of the foregoing and (b) any such losses, claims, damages, liabilities,
deficiencies, judgments or expenses incurred in connection with any remedial or
other action taken by the Credit Parties or any of the Lenders in connection
with compliance by the Credit Parties or any of their Subsidiaries, or any of
their respective properties, with any federal, state or local environmental
laws, acts, rules, regulations, orders, directions, ordinances, criteria or
guidelines. If and to the extent that the obligations of any Credit Party
hereunder are unenforceable for any reason, the Credit Parties hereby agree to
make the maximum contribution to the payment and satisfaction of such
obligations which is permissible under applicable law. The Credit Parties'
obligations hereunder shall survive any termination of this Credit Agreement and
the other Credit Documents and the payment in full of the Obligations, and are
in addition to, and not in substitution of, any other of its obligations set
forth in this Credit Agreement. In addition, the Credit Parties shall, upon
demand, pay to the
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Agent and any Lender all costs and expenses (including the reasonable fees and
disbursements of counsel and other professionals) paid or incurred by the Agent
or such Lender in (i) enforcing or defending its rights under or in respect of
this Credit Agreement, the other Credit Documents or any other document or
instrument now or hereafter executed and delivered in connection herewith, (ii)
in collecting the Loans and (iii) obtaining any legal, accounting or other
advice in connection with any of the foregoing.
SECTION 18.10 AMENDMENTS, WAIVERS AND CONSENTS.
No amendment or waiver of any provision of any Credit Document nor any
consent to any departure by any Credit Party therefrom, shall be effective
unless the same shall be agreed or consented to in writing by the Required
Lenders, or if the Lenders shall not be parties thereto, by the parties thereto
and consented to by the Required Lenders, and each such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given; PROVIDED that no amendment , waiver or consent shall unless in
writing and signed by all the Lenders, do any of the following: (a) increase the
Commitments of the Lenders or subject the Lenders to any additional obligations,
(b) except as otherwise expressly provided in this Credit Agreement, reduce the
principal of, or interest on, any Note or any fees hereunder, (c) postpone any
date fixed for any payment in respect of principal of, or interest on, any Note
or any fees hereunder, (d) change the percentage of the Commitments, or any
minimum requirement necessary for the Lenders or the Required Lenders to take
any action hereunder, (e) amend or waive this Section 13.10, or change the
definition of Required Lenders, (f) release any material portion of the
Collateral and (g) change or waive any conditions precedent to closing contained
in ARTICLE V and, PROVIDED, FURTHER, that no amendment, waiver or consent
affecting the rights or duties of the Agent or the Issuing Lender under any
Credit Document shall in any event be effective, unless in writing and signed by
the Agent or the Issuing Lender, as applicable, in addition to the Lenders
required hereinabove to take such action. Notwithstanding any of the foregoing
to the contrary, the consent of the Borrower shall not be required for any
amendment, modification or waiver of the provisions of ARTICLE XII (other than
the provisions of Section 12.9). In addition, the Borrower and the Lenders
hereby authorize the Agent to modify this Credit Agreement by unilaterally
amending or supplementing SCHEDULE 1.1A from time to time in the manner
requested by the Borrower, the Agent or any Lender in order to reflect any
assignments or transfers of the Loans as provided for hereunder; PROVIDED,
HOWEVER, that the Agent shall promptly deliver a copy of any such modification
to the Borrower and each Lender.
SECTION 18.11 INFORMATION.
Each Credit Party hereby agrees that the Agent and the Lenders may
exchange any information concerning such Credit Party, including, without
limitation, information relating to the creditworthiness of such Credit Party in
the possession or control of the Agent or the Lenders, as the case may be: (i)
with any of their respective affiliates, counsel or other representatives;
PROVIDED, HOWEVER, that any such exchange, and the nature, manner and extent
thereof may be limited pursuant to any written confidentiality agreement
governing the obligations of the Agent or the Lenders or such affiliate, as the
case may be, with respect to such information; PROVIDED, FURTHER, that neither
the Agent nor any of the Lenders shall in any event furnish any such
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information to any competitor of the Borrower or any customer of the Borrower or
any Person known by the Agent or any Lender to be contemplating an acquisition
of any Capital Stock or assets of the Borrower or any agent or affiliate of any
of the foregoing, except with the prior written consent of the Borrower or as
required by applicable law or judicial order; (ii) with any regulatory authority
having jurisdiction over any Lender or (iii) with any other person, in
connection with the exercise of the Lender's rights hereunder or, under any of
the other Credit Documents. Each Credit Party further agrees and consents to the
Agent's disclosure of information relating to this transaction to GOLD SHEETS
and other similar bank trade publications. Such information will consist of deal
terms and other information customarily found in such publications.
SECTION 18.12 PERFORMANCE OF DUTIES.
The Credit Parties' obligations under this Agreement and each of the
Credit Documents shall be performed by the Credit Parties at their sole cost and
expense.
SECTION 18.13 NONLIABILITY OF AGENT AND LENDERS.
The relationship between the Borrower on the one hand and the Lenders
and the Agent on the other hand shall be solely that of borrower and lender.
Neither the Agent nor any Lender shall have any fiduciary responsibilities to
the Borrower or any other Credit Party. Neither the Agent nor any Lender
undertakes any responsibility to the Credit Parties to review or inform the
Credit Parties of any matter in connection with any phase of the Credit Parties'
business or operations.
SECTION 18.14 ALL POWERS COUPLED WITH INTEREST.
All powers of attorney and other authorizations granted to the Agent or
any Lender and any Persons designated by the Agent or any Lender pursuant to any
provisions of this Agreement or any of the other Credit Documents shall be
deemed coupled with an interest and shall be irrevocable so long as any of the
obligations remain unpaid or unsatisfied or this Agreement has not been
terminated.
SECTION 18.15 SURVIVAL OF INDEMNITIES.
Notwithstanding any termination of this Agreement, the indemnities to
which the Lenders are entitled under the provisions of this ARTICLE XIII and any
other provision of this Agreement and the Credit Documents shall continue in
full force and effect and shall protect the Lenders against events arising after
such termination as well as before.
SECTION 18.16 TITLES AND CAPTIONS.
Titles and captions of Articles, Sections and subsections in this
Agreement are for convenience only, and neither limit nor amplify the provisions
of this Agreement.
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SECTION 18.17 SEVERABILITY OF PROVISIONS.
Any provision of this Agreement or any other Credit Document which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective only to the extent of such prohibition or unenforceability
without invalidating the remainder of such provision or the remaining provisions
hereof or thereof or affecting the validity or enforceability of such provision
in any other jurisdiction.
SECTION 18.18 COUNTERPARTS.
This Agreement may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and shall be binding upon all
parties, their successors and assigns, and all of which taken together shall
constitute one and the same agreement.
SECTION 18.19 TERM OF AGREEMENT.
This Agreement shall remain in effect from the Closing Date through and
including the date upon which the Borrower has paid in full all principal of and
interest on the Loans and all other amounts due hereunder and under the other
Credit Documents at the time of such payment, and the termination of the
Revolving Commitment. No termination of this Agreement shall affect the rights
and obligations of the parties hereto arising prior to such termination.
ARTICLE XIX
GUARANTY
SECTION 19.1 THE GUARANTY.
In order to induce the Lenders to enter into this Agreement and to
extend credit hereunder and in recognition of the direct benefits to be received
by the Guarantors from the Loans made hereunder, each of the Guarantors hereby
agrees with the Agent and the Lenders as follows: the Guarantor hereby
unconditionally and irrevocably jointly and severally guarantees as primary
obligor and not merely as surety the full and prompt payment when due, whether
upon maturity, by acceleration or otherwise, of any and all indebtedness of the
Borrower to the Agent and the Lenders. If any or all of the indebtedness of the
Borrower to the Agent and the Lenders becomes due and payable hereunder, each
Guarantor unconditionally promises to pay such indebtedness to the Agent and the
Lenders, or order, on demand, together with any and all reasonable expenses
which may be incurred by the Agent or the Lenders in collecting any of the
indebtedness. The word "indebtedness" is used in this Article XIV in its most
comprehensive sense and includes any and all advances, debts, obligations and
liabilities of the Borrower arising in connection with this Agreement, any of
the other Credit Documents and any of the ELLF Operative Agreements, in each
case, heretofore, now, or hereafter made, incurred or created, whether
voluntarily or involuntarily, absolute or contingent, liquidated or
unliquidated, determined or undetermined, whether or not such indebtedness is
from time to time reduced, or extinguished and thereafter
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increased or incurred, whether the Borrower may be liable individually or
jointly with others, whether or not recovery upon such indebtedness may be or
hereafter become barred by any statute of limitations, and whether or not such
indebtedness may be or hereafter become otherwise unenforceable.
Notwithstanding any provision to the contrary contained herein or in
any other of the Credit Documents, to the extent the obligations of a Guarantor
shall be adjudicated to be invalid or unenforceable for any reason (including,
without limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers) then the obligations of each such Guarantor
hereunder shall be limited to the maximum amount that is permissible under
applicable law (whether federal or state and including, without limitation, the
Bankruptcy Code).
SECTION 19.2 BANKRUPTCY.
Additionally, each of the Guarantors unconditionally and irrevocably
guarantees jointly and severally the payment of any and all indebtedness of the
Borrower to the Lenders whether or not due or payable by the Borrower upon the
occurrence of any of the events specified in Section 11.1(h) or (i), and
unconditionally promises to pay such indebtedness to the Agent for the account
of the Lenders, or order, on demand, in Dollars. Each of the Guarantors further
agrees that to the extent that the Borrower or a Guarantor shall make a payment
or a transfer of an interest in any property to the Agent or any Lender, which
payment or transfer or any part thereof is subsequently invalidated, declared to
be fraudulent or preferential, or otherwise is avoided, and/or required to be
repaid to the Borrower or a Guarantor, the estate of the Borrower or a
Guarantor, a trustee, receiver or any other party under any bankruptcy law,
state or federal law, common law or equitable cause, then to the extent of such
avoidance or repayment, the obligation or part thereof intended to be satisfied
shall be revived and continued in full force and effect as if said payment had
not been made.
SECTION 19.3 NATURE OF LIABILITY.
The liability of each Guarantor hereunder is exclusive and independent
of any security for or other guaranty of the indebtedness of the Borrower
whether executed by any such Guarantor, any other guarantor or by any other
party, and no Guarantor's liability hereunder shall be affected or impaired by
(a) any direction as to application of payment by the Borrower or by any other
party, or (b) any other continuing or other guaranty, undertaking or maximum
liability of a guarantor or of any other party as to the indebtedness of the
Borrower, or (c) any payment on or in reduction of any such other guaranty or
undertaking, or (d) any dissolution, termination or increase, decrease or change
in personnel by the Borrower, or (e) any payment made to the Agent or the
Lenders on the indebtedness which the Agent or such Lenders repay the Borrower
pursuant to court order in any bankruptcy, reorganization, arrangement,
moratorium or other debtor relief proceeding, and each of the Guarantors waives
any right to the deferral or modification of its obligations hereunder by reason
of any such proceeding.
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SECTION 19.4 INDEPENDENT OBLIGATION.
The obligations of each Guarantor hereunder are independent of the
obligations of any other guarantor or the Borrower, and a separate action or
actions may be brought and prosecuted against each Guarantor whether or not
action is brought against any other guarantor or the Borrower and whether or not
any other Guarantor or the Borrower is joined in any such action or actions.
SECTION 19.5 AUTHORIZATION.
Each of the Guarantors authorizes the Agent and each Lender without
notice or demand (except as shall be required by applicable statute and cannot
be waived), and without affecting or impairing its liability hereunder, from
time to time to (a) renew, compromise, extend, increase, accelerate or otherwise
change the time for payment of, or otherwise change the terms of the
indebtedness or any part thereof in accordance with this Agreement, including
any increase or decrease of the rate of interest thereon, (b) take and hold
security from any guarantor or any other party for the payment of this Guaranty
or the indebtedness and exchange, enforce waive and release any such security,
(c) apply such security and direct the order or manner of sale thereof as the
Agent and the Lenders in their discretion may determine and (d) release or
substitute any one or more endorsers, guarantors, the Borrower or other
obligors.
SECTION 19.6 RELIANCE.
It is not necessary for the Agent or the Lenders to inquire into the
capacity or powers of the Borrower or the officers, directors, partners or
agents acting or purporting to act on its behalf, and any indebtedness made or
created in reliance upon the professed exercise of such powers shall be
guaranteed hereunder.
SECTION 19.7 WAIVER.
(a) Each of the Guarantors waives any right (except as shall
be required by applicable statute and cannot be waived) to require the
Agent or any Lender to (i) proceed against the Borrower, any other
guarantor or any other party, (ii) proceed against or exhaust any
security held from the Borrower, any other guarantor or any other
party, or (iii) pursue any other remedy in the Agent's or any Lender's
power whatsoever. Each of the Guarantors waives any defense based on or
arising out of any defense of the Borrower, any other guarantor or any
other party other than payment in full of the indebtedness, including
without limitation any defense based on or arising out of the
disability of the Borrower, any other guarantor or any other party, or
the unenforceability of the indebtedness or any part thereof from any
cause, or the cessation from any cause of the liability of the Borrower
other than payment in full of the indebtedness. The Agent or any of the
Lenders may, at their election, foreclose on any security held by the
Agent or a Lender by one or more judicial or nonjudicial sales, whether
or not every aspect of any such sale is commercially reasonable (to the
extent such sale is permitted by applicable law), or exercise any other
right or remedy the Agent and any Lender may have against
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the Borrower or any other party, or any security, without affecting or
impairing in any way the liability of any Guarantor hereunder except to
the extent the indebtedness has been paid. Each of the Guarantors
waives any defense arising out of any such election by the Agent and
each of the Lenders, even though such election operates to impair or
extinguish any right of reimbursement or subrogation or other right or
remedy of the Guarantors against the Borrower or any other party or any
security.
(b) Each of the Guarantors waives all presentments, demands
for performance, protests and notices, including without limitation
notices of nonperformance, notice of protest, notices of dishonor,
notices of acceptance of this Guaranty, and notices of the existence,
creation or incurring of new or additional indebtedness. Each Guarantor
assumes all responsibility for being and keeping itself informed of the
Borrower's financial condition and assets, and of all other
circumstances bearing upon the risk of nonpayment of the indebtedness
and the nature, scope and extent of the risks which such Guarantor
assumes and incurs hereunder, and agrees that neither the Agent nor any
Lender shall have any duty to advise such Guarantor of information
known to it regarding such circumstances or risks.
(c) Each of the Guarantors hereby agrees it will not exercise
any rights of subrogation which it may at any time otherwise have as a
result of this Guaranty (whether contractual, under Section 509 of the
U.S. Bankruptcy Code, or otherwise) to the claims of the Lenders
against the Borrower or any other guarantor of the indebtedness of the
Borrower owing to the Lenders (collectively, the "OTHER PARTIES") and
all contractual, statutory or common law rights of reimbursement,
contribution or indemnity from any Other Party which it may at any time
otherwise have as a result of this Guaranty until such time as the
Loans hereunder shall have been paid and the Commitments have been
terminated. Each of the Guarantors hereby further agrees not to
exercise any right to enforce any other remedy which the Agent and the
Lenders now have or may hereafter have against any Other Party, any
endorser or any other guarantor of all or any part of the indebtedness
of the Borrower and any benefit of, and any right to participate in,
any security or collateral given to or for the benefit of the Lenders
to secure payment of the indebtedness of the Borrower until such time
as the Loans hereunder shall have been paid and the Commitments have
been terminated.
SECTION 19.8 LIMITATION ON ENFORCEMENT.
The Lenders agree that this Guaranty may be enforced only by the action
of the Agent acting upon the instructions of the Required Lenders and that no
Lender shall have any right individually to seek to enforce or to enforce this
Guaranty, it being understood and agreed that such rights and remedies may be
exercised by the Agent for the benefit of the Lenders upon the terms of this
Agreement. The Lenders further agree that this Guaranty may not be enforced
against any director, officer, employee or stockholder of the Guarantors.
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SECTION 19.9 CONFIRMATION OF PAYMENT.
The Agent and the Lenders will, upon request after payment of the
indebtedness and obligations which are the subject of this Guaranty and
termination of the commitments relating thereto, confirm to the Borrower, the
Guarantors or any other Person that the such indebtedness and obligations have
been paid and the commitments relating thereto terminated, subject to the
provisions of Section 14.2.
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EXHIBIT 2.11
FORM OF
NEW COMMITMENT AGREEMENT
Reference is made to the Credit Agreement dated as of February 24, 1999
(as amended, modified, extended or restated from time to time, the "CREDIT
AGREEMENT") among by and among Sterile Recoveries, Inc., a Florida corporation
(the "BORROWER"), the other Credit Parties party thereto, the Lenders party
thereto and First Union National Bank, as Agent. All of the defined terms in the
Credit Agreement are incorporated herein by reference.
1. Effective as of the Effective Date set forth below, the undersigned
Lender hereby confirms its additional Commitment (the "Additional Commitment"),
in an aggregate principal amount of up to the amount of set forth below, to make
Revolving Loans and to participate in Letters of Credit and Swingline Loans in
accordance with the Credit Agreement. If the undersigned Lender is already a
Lender under the Credit Agreement, such Lender acknowledges and agrees that such
Additional Commitment is in addition to any existing Commitment of such Lender
under the Credit Agreement. If the undersigned Lender is not already a Lender
under the Credit Agreement, such Lender hereby acknowledges, agrees and confirms
that, by its execution of this New Commitment Agreement, such Lender will, as of
the Effective Date, be a party to the Credit Agreement and be bound by the
provisions of the Credit Agreement and, to the extent of its Commitment, have
the rights and obligations of a Lender thereunder.
2. This New Commitment Agreement shall be governed by and construed in
accordance with the laws of the State of Florida.
Amount of Additional Commitment $___________
Effective Date of Additional Commitment ________________, 200_
The terms set forth above
are hereby agreed to:
[Lender]
By:___________________________
Title:________________________
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CONSENTED TO (as required by the Credit Agreement):
FIRST UNION NATIONAL BANK, STERILE RECOVERIES, INC.
as Agent
By:____________________________ By:__________________________
Title:__________________________ Title:_________________________
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