EXHIBIT 10.14
BRIDGE CREDIT AGREEMENT
among
ORTHODONTIC CENTERS OF AMERICA, INC.
as Borrower,
AND
CERTAIN DOMESTIC SUBSIDIARIES OF THE BORROWER,
as Guarantors,
AND
THE LENDERS IDENTIFIED HEREIN,
AND
BANK OF AMERICA, N.A.,
as Administrative Agent
DATED AS OF NOVEMBER 9, ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ SECURITIES LLC,
as Sole Lead Arranger and Book Manager
TABLE OF CONTENTS
SECTION 1 DEFINITIONS AND ACCOUNTING TERMS.......................................... 1
1.1 Definitions............................................................... 1
1.2 Computation of Time Periods and Other Definitional Provisions............. 12
1.3 Accounting Terms/Calculation of Financial Covenants....................... 12
1.4 Time...................................................................... 12
SECTION 2 CREDIT FACILITY........................................................... 12
2.1 Term Loans................................................................ 12
2.2 Continuations and Conversions............................................. 13
2.3 Minimum Amounts........................................................... 13
SECTION 3 GENERAL PROVISIONS APPLICABLE TO TERM LOANS............................... 14
3.1 Interest.................................................................. 14
3.2 Place and Manner of Payments.............................................. 14
3.3 Prepayments............................................................... 15
3.4 Administrative Fees....................................................... 15
3.5 Extension of Maturity Date; Payment in full at Maturity................... 15
3.6 Computations of Interest and Fees......................................... 16
3.7 Pro Rata Treatment........................................................ 16
3.8 Sharing of Payments....................................................... 17
3.9 Capital Adequacy.......................................................... 17
3.10 Eurodollar Provisions..................................................... 17
3.11 Illegality................................................................ 18
3.12 Requirements of Law....................................................... 18
3.13 Taxes..................................................................... 18
3.14 Compensation.............................................................. 20
3.15 Determination and Survival of Provisions.................................. 21
SECTION 4 GUARANTY.................................................................. 21
4.1 Guaranty of Payment....................................................... 21
4.2 Obligations Unconditional................................................. 21
4.3 Modifications............................................................. 22
4.4 Waiver of Rights.......................................................... 22
4.5 Reinstatement............................................................. 22
4.6 Remedies.................................................................. 22
4.7 Limitation of Guaranty.................................................... 22
4.8 Rights of Contribution.................................................... 23
SECTION 5 CONDITIONS PRECEDENT...................................................... 23
5.1 Closing Conditions........................................................ 23
5.2 Conditions to All Extensions of Credit.................................... 26
SECTION 6 REPRESENTATIONS, WARRANTIES AND COVENANTS................................. 26
6.1 Representations and Warranties............................................ 26
6.2 Covenant Regarding Additional Credit Parties and Collateral............... 28
6.3 Incorporation of Additional Representations, Warranties and Covenants..... 28
SECTION 7 EVENTS OF DEFAULT......................................................... 29
7.1 Event of Default.......................................................... 29
7.2 Acceleration; Remedies.................................................... 31
7.3 Allocation of Payments After Event of Default............................. 32
SECTION 8 AGENCY PROVISIONS......................................................... 33
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8.1 Appointment............................................................... 33
8.2 Delegation of Duties...................................................... 33
8.3 Exculpatory Provisions.................................................... 33
8.4 Reliance on Communications................................................ 33
8.5 Notice of Default......................................................... 34
8.6 Non-Reliance on Administrative Agent and Other Lenders.................... 34
8.7 Indemnification........................................................... 35
8.8 Administrative Agent in Its Individual Capacity........................... 35
8.9 Successor Agent........................................................... 35
8.10 Intercreditor Agreement................................................... 35
SECTION 9 MISCELLANEOUS............................................................. 36
9.1 Notices................................................................... 36
9.2 Right of Set-Off.......................................................... 36
9.3 Benefit of Agreement...................................................... 36
9.4 No Waiver; Remedies Cumulative............................................ 38
9.5 Payment of Expenses; Indemnification...................................... 38
9.6 Amendments, Waivers and Consents.......................................... 39
9.7 Counterparts/Telecopy..................................................... 40
9.8 Headings.................................................................. 40
9.9 Survival of Indemnification............................................... 40
9.10 Governing Law; Venue; Jurisdiction........................................ 40
9.11 Waiver of Jury Trial; Waiver of Consequential Damages..................... 40
9.12 Severability.............................................................. 41
9.13 Further Assurances........................................................ 41
9.14 Confidentiality........................................................... 41
9.15 Entirety.................................................................. 41
9.16 Binding Effect; Continuing Agreement...................................... 41
9.17 Conflict with Intercreditor Agreement..................................... 42
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SCHEDULES
Schedule 1.1(a) Commitment Percentages/Lending Offices
Schedule 6.1(g) Subsidiaries
Schedule 9.1 Notices
EXHIBITS
Exhibit 2.1(b) Form of Notice of Borrowing
Exhibit 2.1(c) Form of Term Note
Exhibit 2.2 Form of Notice of Continuation/Conversion
Exhibit 6.2 Form of Joinder Agreement
Exhibit 9.3(b) Form of Assignment Agreement
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BRIDGE CREDIT AGREEMENT
THIS BRIDGE CREDIT AGREEMENT (this "Credit Agreement") is entered into as
of November 9, 2001 among ORTHODONTIC CENTERS OF AMERICA, INC., a Delaware
corporation, as Borrower, certain Domestic Subsidiaries of the Borrower, as
Guarantors, the Lenders and BANK OF AMERICA, N.A., as Administrative Agent for
the Lenders.
RECITALS
WHEREAS, the Borrower and the Guarantors have requested the Lenders to
provide a senior bridge credit facility to the Borrower in an aggregate
principal amount of up to $50,000,000; and
WHEREAS, the Lenders party hereto have agreed to make the requested senior
bridge credit facility available to the Borrower on the terms and conditions
hereinafter set forth.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 DEFINITIONS.
As used herein, the following terms shall have the meanings herein
specified unless the context otherwise requires. Defined terms herein shall
include in the singular number the plural and in the plural the singular:
"Additional Incorporated Terms" has the meaning set forth in Section
6.3.
"Adjusted Base Rate" means the Base Rate plus the Applicable
Percentage.
"Adjusted Eurodollar Rate" means the Eurodollar Rate plus the
Applicable Percentage.
"Administrative Agent" means Bank of America, N.A. (or any successor
thereto) or any successor administrative agent appointed pursuant to
Section 8.9.
"Administrative Fees" has the meaning set forth in Section 3.4.
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling (including but not limited to all
directors and officers of such Person), controlled by or under direct or
indirect common control with such Person. A Person shall be deemed to
control a corporation if such Person possesses, directly or indirectly,
the power (a) to vote 10% or more of the securities having ordinary voting
power for the election of directors of such corporation or (b) to direct
or cause direction of the management and policies of such corporation,
whether through the ownership of voting securities, by contract or
otherwise.
"Agency Services Address" means Bank of America, N.A.,
NC1-001-15-04, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attn: Credit Services, or such other address as may be identified by
written notice from the Administrative Agent to the Borrower.
"Agent-Related Person" means the Administrative Agent (including any
successor administrative agent), together with its Affiliates (including,
in the case of Bank of America in its capacity as the Administrative
Agent, BAS), and their respective officers, directors, employees, agents,
counsel and attorneys-in-fact.
"Agreement and Plan of Merger" means that certain Agreement and Plan
of Merger, dated as of May 16, 2001, among the Borrower, OCA Acquisition
Corporation and OrthAlliance.
"Applicable Percentage" means the appropriate applicable percentages
corresponding to the time periods set forth below:
Applicable
Applicable Percentage
Time Period Percentage for for Base
Eurodollar Loans Rate Loans
From the Closing Date through
February 28, 2002 2.25% 1.25%
From March 1, 2002 through 2.75% 1.75%
May 31, 2002
From June 1, 2002 through 3.25% 2.25%
August 31, 2002
From September 1, 2002 to
the first anniversary of
the Closing Date 3.75% 2.75%
Any adjustment in the Applicable Percentages pursuant to the above pricing
grid shall be applicable to all existing Eurodollar Loans and Base Rate
Loans as well as any new Eurodollar Loans and Base Rate Loans.
Notwithstanding the above pricing grid nor the limitation on interest
rates in the last paragraph of Section 3.1(a), in no event shall the
Applicable Percentages for Eurodollar Loans and Base Rate Loans, as of any
date of determination, be less than the corresponding applicable
percentages in the Revolving Senior Credit Agreement.
"Attorney Costs" means all reasonable fees and disbursements of any
law firm or other external counsel and the reasonable allocated cost of
internal legal services and all disbursements of internal counsel.
"Authorized Officer" means any of the president, chief executive
officer, chief financial officer or treasurer of the Borrower.
"Bank of America" means Bank of America, N.A. or any successor
thereto.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the
United States Code, as amended, modified, succeeded or replaced from time
to time.
"BAS" means Banc of America Securities LLC.
"Base Rate" means, for any day, the rate per annum (rounded upwards,
if necessary, to the nearest whole multiple of 1/100 of 1%) equal to the
greater of (a) the Federal Funds Rate in effect on such day plus -1/2 of
1% or (b) the Prime Rate in effect on such day. If for any reason the
Administrative 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 Administrative Agent to obtain sufficient quotations in
accordance with the terms hereof, the Base Rate shall be determined
without regard to clause (a) 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 at the opening of business on the day
specified in the public announcement of such change.
"Base Rate Loan" means any Term Loan bearing interest at a rate
determined by reference to the Base Rate.
"Benefited Parties" has the meaning set forth in the Intercreditor
Agreement.
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"Borrower" means Orthodontic Centers of America, Inc., a Delaware
corporation, together with its successors and permitted assigns.
"Business Day" means any day other than a Saturday, a Sunday, a
legal holiday or a day on which banking institutions are authorized or
required by law or other governmental action to close in ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇; provided that in the case of Eurodollar
Loans, such day is also a day on which dealings between banks are carried
on in Dollar deposits in the London interbank market.
"Capital Stock" means (a) in the case of a corporation, all classes
of capital stock of such corporation, (b) in the case of a partnership,
partnership interests (whether general or limited), (c) in the case of a
limited liability company, membership interests and (d) 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; and in each case, any and all warrants, rights or options to
purchase any of the foregoing.
"Closing Date" means the date hereof, which is the date on which the
conditions set forth in Section 5.1 were fulfilled (or waived in the sole
discretion of the Lenders) and on which the initial Term Loans were made.
"Code" means the Internal Revenue Code of 1986 and the rules and
regulations promulgated thereunder, as amended, modified, succeeded or
replaced from time to time.
"Collateral" has the meaning set forth in the Collateral Documents.
"Collateral Agent" means First Union National Bank, in its capacity
as collateral agent for the Benefited Parties pursuant to the terms of the
Intercreditor Agreement and the other Credit Documents, and its successors
and permitted assigns in such capacity.
"Collateral Documents" means a collective reference to the Pledge
and Security Agreement and such other documents, instruments and
agreements executed and delivered in connection with the attachment and
perfection of the Administrative Agent's security interests and liens
arising thereunder, including without limitation, Uniform Commercial Code
financing statements.
"Commitment" means the commitment of each Lender with respect to the
Committed Amount.
"Commitment Percentage" means, for each Lender, the percentage
identified as its Commitment Percentage on Schedule 1.1(a), as such
percentage may be modified in connection with any assignment made in
accordance with the provisions of Section 9.3.
"Committed Amount" means FIFTY MILLION DOLLARS ($50,000,000).
"Contingent Obligation" means, with respect to any Person, any
direct or indirect liability of such Person with respect to any
Indebtedness, liability or other obligation (the "primary obligation") of
another Person (the "primary obligor"), whether or not contingent, (a) to
purchase, repurchase or otherwise acquire such primary obligation or any
property constituting direct or indirect security therefor, (b) to advance
or provide funds (i) for the payment or discharge of any such primary
obligation or (ii) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency or any
balance sheet item, level of income or financial condition of the primary
obligor, (c) to purchase property, securities or services primarily for
the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor in respect thereof to make payment of such
primary obligation or (d) otherwise to assure or hold harmless the owner
of any such primary obligation against loss or failure or inability to
perform in respect thereof; provided, however, that, with respect to the
Borrower and its Subsidiaries, the term Contingent Obligation shall not
include endorsements for collection or deposit in the ordinary course of
business. The amount of any Contingent Obligation of any Person shall be
deemed to be an amount equal to the maximum amount of such Person's
liability with respect to the stated or determinable amount of the primary
obligation for which such Contingent Obligation is incurred or, if not
stated or determinable, the maximum reasonably anticipated liability in
respect thereof (assuming such
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Person is required to perform thereunder).
"Credit Agreement" has the meaning set forth in the Preamble hereof.
"Credit Documents" means this Credit Agreement, the Term Notes, the
Collateral Documents, any Joinder Agreement, the Intercreditor Agreement,
any Notice of Borrowing, any Notice of Continuation/Conversion and any
other document, agreement or instrument entered into or executed in
connection with the foregoing.
"Credit Exposure" has the meaning set forth in the definition of
Required Lenders in this Section 1.1.
"Credit Parties" means the Borrower and the Guarantors and "Credit
Party" means any one of them.
"Credit Party Obligations" means, without duplication, (a) all of
the obligations of the Credit Parties to the Lenders and the
Administrative Agent, whenever arising, under this Credit Agreement, the
Term Notes, or any of the other Credit Documents to which any Credit Party
is a party and (b) all liabilities and obligations owing from such Credit
Party to any Lender, or any Affiliate of a Lender, arising under Hedging
Agreements permitted hereunder.
"Debt Issuance" means the issuance, incurrence or sale by any Credit
Party or any of its Subsidiaries of any debt securities or other
Indebtedness, whether in a public offering of such securities or
otherwise, other than any Indebtedness expressly permitted under Section
8.2 (excluding Section 8.2(v)) of the Incorporated Covenants.
"Default" means any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" means, at any time, any Lender that, (a) has
failed to make a Term Loan (but only for so long as such Term Loan is not
made), (b) has failed to pay to the Administrative Agent or any Lender an
amount owed by such Lender pursuant to the terms of this Credit Agreement
(but only for so long as such amount has not been repaid) or (c) has been
deemed insolvent or has become subject to a bankruptcy or insolvency
proceeding or to a receiver, trustee or similar official.
"Disqualified Capital Stock" means, with respect to any Person, any
Capital Stock of such Person that, by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable), or
upon the happening of any event or otherwise, (a) matures or is
mandatorily redeemable or subject to any mandatory repurchase requirement,
pursuant to a sinking fund obligation or otherwise, (b) is redeemable or
subject to any mandatory repurchase requirement at the sole option of the
holder thereof, or (c) is convertible into or exchangeable for (whether at
the option of the issuer or the holder thereof) (i) debt securities or
(ii) any Capital Stock referred to in (a) or (b) above, in each case under
(a), (b) or (c) above at any time on or prior to the first anniversary of
the Extended Maturity Date; provided, however, that only the portion of
Capital Stock that so matures or is mandatorily redeemable, is so
redeemable at the option of the holder thereof, or is so convertible or
exchangeable on or prior to such date shall be deemed to be Disqualified
Capital Stock.
"Dollars" and "$" means dollars in lawful currency of the United
States of America.
"Domestic Subsidiary" means each direct and indirect Subsidiary of
the Borrower that is organized under the laws of the United States of
America or any state thereof or the District of Columbia.
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a
Lender; and (c) any other Person approved by the Administrative Agent and
the Borrower (such approval not to be unreasonably withheld or delayed);
provided that (i) the Borrower's consent is not required during the
existence and continuation of a Default or an Event of Default, (ii)
approval by the Borrower shall be deemed given if no objection is received
by the assigning Lender and the Administrative Agent from the Borrower
within five Business
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Days after notice of such proposed assignment has been delivered to the
Borrower; and (iii) neither the Borrower nor an Affiliate of the Borrower
shall qualify as an Eligible Assignee.
"Equity Issuance" means the issuance, sale or other disposition by a
Credit Party or any of its Subsidiaries of its Capital Stock, any rights,
warrants or options to purchase or acquire any shares of its Capital Stock
or any other security or instrument representing, convertible into or
exchangeable for an equity interest in such Credit Party or any of its
Subsidiaries; provided, however, that the term Equity Issuance shall not
include (a) the issuance or sale of Capital Stock by any of the
Subsidiaries of the Borrower to the Borrower or any other Subsidiary;
provided that such Capital Stock is pledged to the Collateral Agent
pursuant to a Pledge and Security Agreement, (b) any Capital Stock of the
Borrower issued or sold in connection with any Permitted Acquisition and
constituting all or a portion of the applicable purchase price, or (c) any
rights, options or other Capital Stock issued pursuant to bona fide
employee, director or Managed Practice stock option or purchase plans or
arrangements approved by the Borrower's board of directors or upon the
exercise of rights or options issued under any such plan or arrangement.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and any successor statute, and all rules and
regulations from time to time promulgated thereunder.
"ERISA Affiliate" means any Person (including any trade or business,
whether or not incorporated) that would be deemed to be under "common
control" with, or a member of the same "controlled group" as, any Credit
Party or any of its Subsidiaries, within the meaning of Sections 414(b),
(c), (m) or (o) of the Code or Section 4001 of ERISA.
"ERISA Event" means any of the following with respect to a Plan or
Multiemployer Plan, as applicable: (a) a Reportable Event with respect to
a Plan or a Multiemployer Plan, (b) a complete or partial withdrawal by
any Credit Party, any of its Subsidiaries or any ERISA Affiliate from a
Multiemployer Plan that results in liability under Section 4201 or 4204 of
ERISA, or the receipt by any Credit Party, any of its Subsidiaries or any
ERISA Affiliate of notice from a Multiemployer Plan that it is in
reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA or
that it intends to terminate or has terminated under Section 4041A of
ERISA, (c) the distribution by any Credit Party, any of its Subsidiaries
or any ERISA Affiliate under Section 4041 or 4041A of ERISA of a notice of
intent to terminate any Plan or the taking of any action to terminate any
Plan, (d) the commencement of proceedings by the PBGC under Section 4042
of ERISA for the termination of, or the appointment of a trustee to
administer, any Plan, or the receipt by any Credit Party, any of its
Subsidiaries or any ERISA Affiliate of a notice from any Multiemployer
Plan that such action has been taken by the PBGC with respect to such
Multiemployer Plan, (e) the institution of a proceeding by any fiduciary
of any Multiemployer Plan against any Credit Party, any of its
Subsidiaries or any ERISA Affiliate to enforce Section 515 of ERISA, which
is not dismissed within thirty (30) days, (f) the imposition upon any
Credit Party, any of its Subsidiaries or any ERISA Affiliate of any
liability under Title IV of ERISA, other than for PBGC premiums due but
not delinquent under Section 4007 of ERISA, or the imposition or
threatened imposition of any Lien upon any assets of any Credit Party, any
of its Subsidiaries or any ERISA Affiliate as a result of any alleged
failure to comply with the Code or ERISA in respect of any Plan, (g) the
engaging in or otherwise becoming liable for a nonexempt Prohibited
Transaction by any Credit Party, any of its Subsidiaries or any ERISA
Affiliate, (h) a violation of the applicable requirements of Section 404
or 405 of ERISA or the exclusive benefit rule under Section 401(a) of the
Code by any fiduciary of any Plan for which any Credit Party, any of its
Subsidiaries or any ERISA Affiliate may be directly or indirectly liable
or (i) the adoption of an amendment to any Plan that, pursuant to Section
401(a)(29) of the Code or Section 307 of ERISA, would result in the loss
of tax-exempt status of the trust of which such Plan is a part if any
Credit Party, any of its Subsidiaries or any ERISA Affiliate fails to
timely provide security to such Plan in accordance with the provisions of
such sections.
"Eurodollar Loan" means a Term Loan bearing interest based at a rate
determined by reference to the Eurodollar Rate.
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"Eurodollar Rate" means, for the Interest Period for each Eurodollar
Loan comprising part of the same borrowing (including conversions,
extensions and renewals), a per annum interest rate determined pursuant to
the following formula:
Eurodollar Rate = London Interbank Offered Rate
---------------------------------
1 - Eurodollar Reserve Percentage
"Eurodollar Reserve Percentage" means for any day, that percentage
(expressed as a decimal) which is in effect from time to time under
Regulation D, as such regulation may be amended from time to time or any
successor regulation, as the maximum reserve requirement (including,
without limitation, any basic, supplemental, emergency, special, or
marginal reserves) applicable with respect to Eurodollar liabilities as
that term is defined in Regulation D (or against any other category of
liabilities that includes deposits by reference to which the interest rate
of Eurodollar Loans is determined), whether or not a Lender has any
Eurodollar liabilities subject to such reserve requirement at that time.
Eurodollar Loans shall be deemed to constitute Eurodollar liabilities and
as such shall be deemed subject to reserve requirements without benefits
of credits for proration, exceptions or offsets that may be available from
time to time to a Lender. The Eurodollar Rate shall be adjusted
automatically on and as of the effective date of any change in the
Eurodollar Reserve Percentage.
"Event of Default" has the meaning set forth in Section 7.1.
"Extended Maturity Date" has the meaning set forth in Section
3.5(a).
"Federal Funds Rate" means for any day the rate per annum (rounded
upward, if necessary, to the nearest 1/100th 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 and (b) if no such
rate is so published on such next preceding Business Day, the Federal
Funds Rate for such day shall be the average rate quoted to the
Administrative Agent on such day on such transactions from three Federal
Funds brokers of recognized standing selected by it.
"Fee Letter" means that certain letter agreement, dated as of
October 24, 2001, among the Borrower, Bank of America and BAS, as amended,
modified, supplemented or restated from time to time.
"GAAP" means generally accepted accounting principles in the United
States applied on a consistent basis and subject to Section 1.3.
"Governmental Authority" means any domestic or foreign nation or
government, any state or other political subdivision thereof and any
central bank thereof, any municipal, local, city or county government, and
any entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government (including,
without limitation, any state dental board) and any corporation or other
entity owned or controlled, through stock or capital ownership or
otherwise, by any of the foregoing.
"Guarantor" means each of the direct or indirect Domestic
Subsidiaries of the Borrower (other than Inactive Subsidiaries) and each
other Person who becomes a Guarantor hereunder, together with their
successors and permitted assigns.
"Guaranty" means the guaranty of the Credit Party Obligations
provided by the Guarantors pursuant to Section 4.
"Hedging Agreements" means, collectively, interest rate protection
agreements, foreign currency exchange agreements, commodity purchase or
option agreements or other interest or exchange rate or commodity price
hedging agreements, in each case, entered into or purchased by a Credit
Party.
"Inactive Subsidiary" means any Subsidiary of the Borrower (i) the
Capital Stock of which is or has been acquired by the Borrower or any of
its Subsidiaries from individuals who enter into a Service
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Agreement in the ordinary course of the Borrower's or its Subsidiaries'
acquisition program, (ii) the total assets of which do not exceed, on a
book value basis, $25,000 at any one time and (iii) that has no active or
customer revenue and which does not conduct any active trade or business;
provided, however, that in no event shall a Subsidiary that is a guarantor
of the Borrower's obligations under the Revolving Senior Credit Agreement
be an Inactive Subsidiary.
"Incorporated Covenants" has the meaning set forth in Section 6.3.
"Incorporated Representations and Warranties" has the meaning set
forth in Section 6.3.
"Indebtedness" means, with respect to any Person (without
duplication), (a) all indebtedness and obligations of such Person for
borrowed money or in respect of loans or advances of any kind, (b) all
obligations of such Person evidenced by notes, bonds, debentures or
similar instruments, (c) all reimbursement obligations of such Person with
respect to surety bonds, letters of credit and bankers' acceptances (in
each case, whether or not drawn or matured and in the stated amount
thereof), (d) all obligations of such Person to pay the deferred purchase
price of property or services, (e) all indebtedness created or arising
under any conditional sale or other title retention agreement with respect
to property acquired by such Person, (f) all obligations of such Person as
lessee under leases that are or are required to be, in accordance with
GAAP, recorded as capital leases, to the extent such obligations are
required to be so recorded, (g) all Disqualified Capital Stock issued by
such Person, with the amount of Indebtedness represented by such
Disqualified Capital Stock being equal to the greater of its voluntary or
involuntary liquidation preference and its maximum fixed repurchase price,
but excluding accrued dividends, if any (for purposes hereof, the "maximum
fixed repurchase price" of any Disqualified Capital Stock that does not
have a fixed repurchase price shall be calculated in accordance with the
terms of such Disqualified Capital Stock as if such Disqualified Capital
Stock were purchased on any date on which Indebtedness shall be required
to be determined pursuant to this Credit Agreement, and if such price is
based upon, or measured by, the fair market value of such Disqualified
Capital Stock, such fair market value shall be determined reasonably and
in good faith by the board of directors or other governing body of the
issuer of such Disqualified Capital Stock), (h) the net termination
obligations of such Person under any Hedging Agreements, calculated as of
any date as if such agreement or arrangement were terminated as of such
date, (i) all Contingent Obligations of such Person, (j) all obligations
and liabilities of such Person incurred in connection with any transaction
or series of transactions providing for the financing of assets through
one or more securitizations or in connection with, or pursuant to, any
synthetic lease or similar off-balance sheet financing, (k) the aggregate
amount of uncollected accounts receivable of such Person subject at the
time of determination to a sale of receivables (or similar transaction) to
the extent such transaction is effected with recourse to such Person
(whether or not such transaction would be reflected on the balance sheet
of such Person in accordance with GAAP), and (l) all indebtedness referred
to in clauses (a) through (k) above secured by any Lien on any property or
asset owned or held by such Person regardless of whether the indebtedness
secured thereby shall have been assumed by such Person or is nonrecourse
to the credit of such Person.
"Indemnified Liabilities" has the meaning set forth in Section 9.5.
"Intercompany Notes" means the intercompany notes evidencing
Indebtedness permitted pursuant to Section 8.1(iv) of the Incorporated
Covenants.
"Intercreditor Agreement" means the Intercreditor Agreement, dated
as of the Closing Date, among the Administrative Agent (on behalf of
itself and the Lenders), the Revolver Agent (on behalf of itself and the
Revolver Lenders) and the Collateral Agent, as amended, modified,
supplemented or restated from time to time with the consent of the
Administrative Agent.
"Interest Payment Date" means (a) as to Base Rate Loans, the first
day of each calendar month and the Maturity Date or the Extended Maturity
Date (if the Maturity Date is extended in accordance with the terms of
Section 3.5(a)) and (b) as to Eurodollar Loans, the last day of each
applicable Interest Period and the Maturity Date or the Extended Maturity
Date (if the Maturity Date is extended in accordance with the terms of
Section 3.5(a)).
7
"Interest Period" means, as to Eurodollar Loans, a period of one
month duration commencing on the date of the borrowing (including
continuations and conversions thereof); provided, however, (a) if any
Interest Period would end on a day which is not a Business Day, such
Interest Period shall be extended to the next succeeding Business Day
(except that where the next succeeding Business Day falls in the next
succeeding calendar month, then on the next preceding Business Day), (b)
no Interest Period shall extend beyond the Maturity Date or the Extended
Maturity Date (if the Maturity Date is extended in accordance with the
terms of Section 3.5(a)) and (c) where an Interest Period begins on a day
for which there is no numerically corresponding day in the calendar month
in which the Interest Period is to end, such Interest Period shall end on
the last Business Day of such calendar month.
"Joinder Agreement" means a joinder agreement substantially in the
form of Exhibit 6.2.
"Lender" means any of the Persons identified as a "Lender" on the
signature pages hereto, and any Eligible Assignee which may become a
Lender by way of assignment in accordance with the terms hereof, together
with their successors and permitted assigns.
"Lending Office" means, as to any Lender, the office or offices of
such Lender described as such on Schedule 1.1(a), or such other office or
offices as a Lender may from time notify to the Borrower and the
Administrative Agent.
"Lien" means any mortgage, pledge, hypothecation, assignment,
security interest, lien (statutory or otherwise), preference, priority,
charge or other encumbrance of any nature, whether voluntary or
involuntary, including, without limitation, the interest of any vendor or
lessor under any conditional sale agreement, title retention agreement,
capital lease or any other lease or arrangement having substantially the
same effect as any of the foregoing.
"Licenses" means any and all licenses (including provisional
licenses), certificates of need, accreditations, permits, franchises,
rights to conduct business, approvals (by a Governmental Authority or
otherwise), consents, qualifications, operating authority and any other
authorizations.
"Limitation" means a revocation, suspension, termination,
impairment, probation, limitation, non-renewal, forfeiture, declaration of
ineligibility, loss of status as a participating provider in a Third Party
Payor Arrangement, and the loss of any other rights.
"London Interbank Offered Rate" means, with respect to any
Eurodollar Loan for the Interest Period applicable thereto, the rate of
interest 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 Business Days prior to the
first day of such Interest Period for a term comparable to such Interest
Period; provided, however, if more than one rate is specified on Telerate
Page 3750, the applicable rate shall be the arithmetic mean of all such
rates. If, for any reason, such rate is not available, the term "London
Interbank Offered Rate" shall mean, with respect to any Eurodollar Loan
for the Interest Period applicable thereto, the rate of interest 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
Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period; provided, however, if more than one
rate is specified on Reuters Screen LIBO Page, the applicable rate shall
be the arithmetic mean of all such rates.
"Managed Practice" means any dentist, orthodontist, professional
association, professional corporation, partnership or similar Person for
whose practice a Credit Party or any of its Subsidiaries provides
business, management, administrative or other non-clinical support
services pursuant to a Service Agreement.
"Material Adverse Change" means a material adverse change in the
condition (financial or otherwise), operations, business, performance,
properties or assets of the Credit Parties and their Subsidiaries, taken
as a whole.
8
"Material Adverse Effect" means a material adverse effect upon (a)
the business, assets, liabilities (actual or contingent), operations,
condition (financial or otherwise) or prospects of the Credit Parties and
their Subsidiaries, taken as a whole, (b) the ability of the Credit
Parties and their Subsidiaries, taken as a whole, to perform their
obligations under this Credit Agreement or any of the other Credit
Documents or (c) the legality, validity or enforceability of this Credit
Agreement or any of the other Credit Documents or the rights and remedies
of the Administrative Agent and the Lenders hereunder and thereunder.
"Maturity Date" means November 9, 2002.
"Multiemployer Plan" means any "multiemployer plan" within the
meaning of Section 4001(a)(3) of ERISA to which any Credit Party, any of
its Subsidiaries or any ERISA Affiliate makes, is making or is obligated
to make contributions or has made or been obligated to make contributions.
"Net Cash Proceeds" means, in the case of any Equity Issuance or
Debt Issuance, the aggregate cash payments received by the Credit Parties
and their Subsidiaries less reasonable and customary fees and expenses
(including underwriting discounts and commissions) incurred by the Credit
Parties and their Subsidiaries in connection therewith.
"Notice of Borrowing" means a request by the Borrower for a Term
Loan in the form of Exhibit 2.1(b).
"Notice of Continuation/Conversion" means a request by the Borrower
to continue an existing Eurodollar Loan to a new Interest Period or to
convert a Eurodollar Loan to a Base Rate Loan or a Base Rate Loan to a
Eurodollar Loan, in the form of Exhibit 2.2.
"OrthAlliance" means OrthAlliance, Inc., a Delaware corporation.
"OrthAlliance Acquisition" means the acquisition by the Borrower of
OrthAlliance pursuant to the Agreement and Plan of Merger.
"Other Taxes" has the meaning set forth in Section 3.13(b).
"PBGC" means the Pension Benefit Guaranty Corporation and any
successor thereto.
"Permitted Liens" shall have the meaning set forth in Section 8.3 of
the Incorporated Covenants.
"Person" means any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other
enterprise (whether or not incorporated), or any Governmental Authority.
"Plan" means any "employee pension benefit plan" within the meaning
of Section 3(2) of ERISA that is subject to the provisions of Title IV of
ERISA (other than a Multiemployer Plan) and to which any Credit Party, any
of its Subsidiaries or any ERISA Affiliate may have any liability.
"Pledge and Security Agreement" means any pledge and security
agreement executed and delivered by a Credit Party in favor of the
Collateral Agent and the Administrative Agent, for the benefit of the
Lenders, as amended, modified, restated or supplemented from time to time.
"Prime Rate" means the per annum rate of interest established from
time to time by the Administrative Agent at its principal office in
Charlotte, North Carolina (or such other principal office of the
Administrative Agent as communicated in writing to the Borrower and the
Lenders) as its Prime Rate. Any change in the interest rate resulting from
a change in the Prime Rate shall become effective as of 12:01 a.m. of the
Business Day on which each change in the Prime Rate is announced by the
Administrative Agent. The Prime Rate is a reference rate used by the
Administrative Agent in determining interest rates on certain loans and is
not intended to be the lowest rate of interest charged on any extension of
credit to any debtor.
9
"Pro Forma Basis" means, for purposes of determining compliance with
the financial covenants set forth in Article VII of the Incorporated
Covenants as of any date of determination, that (a) Consolidated
Indebtedness shall be determined as of such date of determination after
giving effect to any borrowing on such date and (b) Consolidated Lease
Expense, Consolidated Cash Flow, Consolidated Fixed Charges and
Consolidated Net Worth shall be as set forth in the most recent Compliance
Certificate delivered pursuant to Section 6.2(a) of the Incorporated
Covenants. For purposes of this definition, "Consolidated Indebtedness,"
"Consolidated Lease Expense," "Consolidated Cash Flow," "Consolidated
Fixed Charges," "Consolidated Net Worth," and "Compliance Certificate"
shall have the meanings ascribed thereto in the Revolving Senior Credit
Agreement as of the Closing Date.
"Prohibited Transaction" means any transaction described in (a)
Section 406 of ERISA that is not exempt by reason of Section 408 of ERISA
or by reason of a Department of Labor prohibited transaction individual or
class exemption or (b) Section 4975(c) of the Code that is not exempt by
reason of Section 4975(c)(2) or 4975(d) of the Code.
"Property" means any right, title or interest in or to any property
or asset of any kind whatsoever, whether real, personal or mixed and
whether tangible or intangible.
"Reimbursement Approvals" means, with respect to all Third Party
Payor Arrangements, any and all certifications, provider numbers, provider
agreements, participation agreements, accreditations and any other similar
agreements with or approvals by Governmental Authorities or other Persons.
"Reportable Event" means (a) any "reportable event" within the
meaning of Section 4043(c) of ERISA for which the 30-day notice under
Section 4043(a) of ERISA has not been waived by the PBGC (including any
failure to meet the minimum funding standard of, or timely make any
required installment under, Section 412 of the Code or Section 302 of
ERISA, regardless of the issuance of any waivers in accordance with
Section 412(d) of the Code), (b) any such "reportable event" subject to
advance notice to the PBGC under Section 4043(b)(3) of ERISA, (c) any
application for a funding waiver or an extension of any amortization
period pursuant to Section 412 of the Code, and (d) a cessation of
operations described in Section 4062(e) of ERISA.
"Required Lenders" means Lenders whose aggregate Credit Exposure (as
hereinafter defined) constitutes more than 66 2/3% of the Credit Exposure
of all Lenders at such time; provided, however, that if any Lender shall
be a Defaulting Lender at such time then there shall be excluded from the
determination of Required Lenders the aggregate principal amount of Credit
Exposure of such Lender at such time. For purposes hereof, the term
"Credit Exposure" as applied to each Lender shall mean (a) at any time
prior to the termination of the Commitments, the product of the Commitment
Percentage of such Lender multiplied by the aggregate principal amount of
Term Loans outstanding at such time and (b) at any time after the
termination of the Commitments, the principal balance of the outstanding
Term Loans of such Lender.
"Requirement of Law" means, with respect to any Person, the charter,
articles or certificate of organization or incorporation and bylaws or
other organizational or governing documents of such Person, and any
statute, law, treaty, rule, regulation, order, decree, writ, injunction or
determination of any arbitrator or court or other Governmental Authority,
in each case applicable to or binding upon such Person or any of its
property or to which such Person or any of its property is subject or
otherwise pertaining to any or all of the transactions contemplated by
this Credit Agreement and the other Credit Documents.
"Responsible Officer" means, with respect to any Credit Party or any
of its Subsidiaries, the president, the chief executive officer, the
co-chief executive officer, the chief financial officer, any executive
officer, vice president - finance, principal accounting officer or
treasurer of such Credit Party or Subsidiary, and any other officer or
similar official thereof responsible for the administration of the
obligations of such Credit Party or such Subsidiary in respect of this
Credit Agreement and the other Credit Documents.
10
"Revolver Agent" has the meaning set forth in the definition of
Revolving Senior Credit Agreement.
"Revolver Lenders" has the meaning set forth in the definition of
Revolving Senior Credit Agreement.
"Revolving Senior Credit Agreement" means that certain Credit
Agreement, dated as of October 8, 1998, among the Borrower and certain
foreign subsidiaries of the Borrower party thereto, as borrowers, the
guarantors party thereto, the lenders party thereto (the "Revolver
Lenders"), First Union National Bank, as agent (the "Revolver Agent"),
Bank of America, as documentation agent, and Citibank, N.A., as
syndication agent, as such agreement has been amended or modified on or
prior to the Closing Date and as it may be amended, modified, or
supplemented from time to time thereafter in accordance with the terms
thereof.
"Second Amendment" has the meaning set forth in Section 5.1(j).
"Second Borrowing" has the meaning set forth in Section 2.1(b).
"Service Agreement" means any agreement or arrangement between any
Credit Party or any of its Subsidiaries and one or more Managed Practices
pursuant to which such Credit Party or such Subsidiary agrees to provide
or arrange for comprehensive management, administrative and other
non-medical support services to such Managed Practice or Practices in
exchange for payment to such Credit Party or such Subsidiary of a service,
management or similar fee.
"Solvent" means, with respect to any Person as of a particular date,
that on such date (a) such Person is able to pay its debts and other
liabilities, Contingent Obligations and other commitments as they mature
in the normal course of business, (b) such Person does not intend to, and
does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities mature in their
ordinary course, (c) such Person is not engaged in a business or a
transaction, and is not about to engage in a business or a transaction,
for which such Person's assets would constitute unreasonably small capital
after giving due consideration to the prevailing practice in the industry
in which such Person is engaged or is to engage, (d) the fair value of the
assets of such Person is greater than the total amount of liabilities,
including, without limitation, Contingent Obligations, of such Person and
(e) the present fair saleable value of the assets of such Person is not
less than the amount that will be required to pay the probable liability
of such Person on its debts as they become absolute and matured.
"Subsidiary" means, as to any Person, (a) any corporation more than
50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such
corporation (irrespective of whether or not at the time, any class or
classes of such corporation shall have or might have voting power by
reason of the happening of any contingency) is at the time owned by such
Person directly or indirectly through Subsidiaries, and (b) any
partnership, association, joint venture or other entity in which such
person directly or indirectly through Subsidiaries has more than a 50%
equity interest at any time.
"Taxes" has the meaning set forth in Section 3.13(a).
"Term Loans" or "Loans" has the meaning set forth in Section 2.1(a).
"Term Notes" or "Notes" means the promissory notes of the Borrower
in favor of each of the Lenders evidencing the Term Loans provided
pursuant to Section 2.1, individually or collectively, as appropriate, as
such promissory notes may be amended, modified, supplemented, extended,
renewed or replaced from time to time and as evidenced in the form of
Exhibit 2.1(c).
"Third Party Payor Arrangements" means any and all arrangements with
Medicare, Medicaid, TRICARE/CHAMPUS and any other Governmental Authority
or quasi-public agency, Blue Cross, Blue Shield, any managed care plans
and organizations including, without limitation, health maintenance
organizations and preferred provider organizations, private commercial
insurance companies and any similar third party arrangements, plans or
programs for payment or reimbursement in connection with health care
services, products or supplies.
11
1.2 COMPUTATION OF TIME PERIODS AND OTHER DEFINITIONAL PROVISIONS.
For purposes of computation of periods of time hereunder, the word "from"
means "from and including" and the words "to" and "until" each mean "to but
excluding." References in this Credit Agreement to "Articles", "Sections",
"Schedules" or "Exhibits" shall be to Articles, Sections, Schedules or Exhibits
of or to this Credit Agreement unless otherwise specifically provided.
1.3 ACCOUNTING TERMS/CALCULATION OF FINANCIAL COVENANTS.
Except as otherwise expressly provided herein, all accounting terms used
herein or incorporated herein by reference shall be interpreted, and all
financial statements and certificates and reports as to financial matters
required to be delivered to the Administrative Agent or the Lenders hereunder
shall be prepared, in accordance with GAAP applied on a consistent basis.
Notwithstanding anything to the contrary in this Credit Agreement, for purposes
of calculation of the financial covenants set forth in Article VII of the
Revolving Senior Credit Agreement, all accounting determinations and
computations thereunder shall be made in accordance with GAAP as in effect as of
the date of this Credit Agreement applied on a basis consistent with the
application used in preparing the most recent financial statements of the Credit
Parties referred to in Section 5.1(d). In the event that any changes in GAAP
after such date are required to be applied to the Credit Parties and would
affect the computation of the financial covenants contained in Article VII of
the Incorporated Covenants, such changes shall be followed only from and after
the date this Credit Agreement shall have been amended to take into account any
such changes. Notwithstanding the foregoing or any other provision of this
Credit Agreement, the assets, liabilities, revenues, income, losses and other
financial statement items of Subsidiaries of the Borrower that are not
Guarantors shall not be taken into account in the calculation of the financial
covenants set forth in Article VII of the Incorporated Covenants.
1.4 TIME.
All references to time herein shall be references to Eastern Standard Time
or Eastern Daylight time, as the case may be, unless specified otherwise.
SECTION 2
CREDIT FACILITY
2.1 TERM LOANS.
(a) Term Loans. Subject to the terms and conditions set forth
herein, each Lender severally agrees to make term loans (collectively, the
"Term Loans" or "Loans") to the Borrower, in Dollars, in an amount equal
to such Lender's Commitment Percentage of the Committed Amount; provided
that the aggregate amount of such Term Loans made shall not exceed the
Committed Amount. Once repaid or prepaid, Term Loans cannot be reborrowed.
(b) Funding of Term Loans. By no later than 11:00 a.m. on the
Closing Date, the Borrower shall submit to the Administrative Agent a
Notice of Borrowing setting forth the amount of Term Loans requested to be
funded on the Closing Date and a certification that the Borrower has
complied in all respects with Section 5.2; provided that at least
$40,000,000 of the Committed Amount shall be funded on the Closing Date.
All or a portion of the remainder of the Committed Amount, if any, may be
borrowed by the Borrower in a single borrowing (the "Second Borrowing")
within 90 days of the Closing Date. By no later than 11:00 a.m. (a) on the
date of the Second Borrowing if the Term Loans requested will be Base Rate
Loans or (b) three Business Days prior to the date of the Second Borrowing
if the Term Loans requested will be Eurodollar Loans, the Borrower shall
telephone the Administrative Agent with the information described below as
well as submit a written Notice of Borrowing to the Administrative Agent
setting forth (i) the amount requested, (ii) whether such Term Loans shall
be Base Rate Loans or Eurodollar Loans and (iii) a certification that the
Borrower has complied in all respects with Section 5.2. On the Closing
Date and on the date of the Second Borrowing, if any, each Lender will
make its Commitment Percentage of the requested
12
Term Loans available to the Administrative Agent by deposit, in Dollars
and in immediately available funds, at the offices of the Administrative
Agent at the Agency Services Address or at such other address as the
Administrative Agent may designate in writing. The amount of the Term
Loans will then be made available to the Borrower by the Administrative
Agent by crediting the account of the Borrower on the books of such office
of the Administrative Agent, to the extent the amount of such Term Loans
are made available to the Administrative Agent. All Term Loans made on the
Closing Date or within three Business Days after the Closing Date shall be
Base Rate Loans. Thereafter, all or any portion of the Term Loans may be
converted into Eurodollar Loans in accordance with the terms of Section
2.2.
No Lender shall be responsible for the failure or delay by any other
Lender in its obligation to make a Term Loan hereunder; provided, however,
that the failure of any Lender to fulfill its obligations hereunder shall
not relieve any other Lender of its obligations hereunder. If the
Administrative Agent shall have received an executed signature page to
this Credit Agreement (whether an original or via telecopy) from a Lender,
the Administrative Agent may assume that such Lender has or will make the
amount of its Term Loans available to the Administrative Agent on the
Closing Date and on the date of the Second Borrowing, if any, and the
Administrative Agent in reliance upon such assumption, may (in its sole
discretion but without any obligation to do so) make available to the
Borrower a corresponding amount. If such corresponding amount is not in
fact made available to the Administrative Agent, the Administrative Agent
shall be able to recover such corresponding amount from such Lender. If
such Lender does not pay such corresponding amount forthwith upon the
Administrative Agent's demand therefor, the Administrative Agent will
promptly notify the Borrower, and the Borrower shall immediately pay such
corresponding amount to the Administrative Agent. The Administrative Agent
shall also be entitled to recover from the Lender or the Borrower, as the
case may be, interest on such corresponding amount in respect of each day
from the date such corresponding amount was made available by the
Administrative Agent to the Borrower to the date such corresponding amount
is recovered by the Administrative Agent at a per annum rate equal to (i)
from the Borrower at the Base Rate and (ii) from a Lender at the Federal
Funds Rate if paid within two Business Days of the date of drawing and
thereafter at a rate equal to the Base Rate.
(c) Term Notes. The Term Loans made by each Lender shall be
evidenced by a duly executed promissory note of the Borrower to such
Lender in an original principal amount equal to the Commitment of such
Lender in substantially the form of Exhibit 2.1(c).
2.2 CONTINUATIONS AND CONVERSIONS.
Subject to the terms below, the Borrower shall have the option, on any
Business Day prior to the Maturity Date, to continue existing Eurodollar Loans
for a subsequent Interest Period, to convert Base Rate Loans into Eurodollar
Loans or to convert Eurodollar Loans into Base Rate Loans. By no later than
11:00 a.m. (a) on the date of the requested conversion of a Eurodollar Loan to a
Base Rate Loan or (b) three Business Days prior to the date of the requested
continuation of a Eurodollar Loan or conversion of a Base Rate Loan to a
Eurodollar Loan, the Borrower shall provide telephonic notice to the
Administrative Agent, followed promptly by a written Notice of
Continuation/Conversion in the form of Exhibit 2.2, setting forth whether the
Borrower wishes to continue or convert such Term Loans. Notwithstanding anything
herein to the contrary, (A) except as provided in Section 3.11, Eurodollar Loans
may only be continued or converted into Base Rate Loans on the last day of the
Interest Period applicable thereto, (B) Eurodollar Loans may not be continued
nor may Base Rate Loans be converted into Eurodollar Loans during the existence
and continuation of a Default or an Event of Default and (C) any request to
continue a Eurodollar Loan that fails to comply with the terms hereof or any
failure to request a continuation of a Eurodollar Loan at the end of an Interest
Period shall be deemed a request to convert such Eurodollar Loan to a Base Rate
Loan on the last day of the applicable Interest Period.
2.3 MINIMUM AMOUNTS.
Each request for a conversion or continuation shall be subject to the
requirements that (a) each Eurodollar Loan shall be in a minimum amount of
$5,000,000 and in integral multiples of $1,000,000 in excess thereof, (b) each
Base Rate Loan shall be in a minimum amount of $500,000 and in integral
multiples of $100,000 in excess thereof (or the remaining amount of outstanding
Term Loans), and (c) no more than 5 Eurodollar Loans shall be outstanding
hereunder
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at any one time. For the purposes of this Section 2.3, separate Eurodollar Loans
that begin and end on the same date, as well as Eurodollar Loans that begin and
end on different dates, shall all be considered as separate Eurodollar Loans.
SECTION 3
GENERAL PROVISIONS APPLICABLE
TO TERM LOANS
3.1 INTEREST.
(a) Interest Rate. Subject to Section 3.1(b) and the last
paragraph of this subsection (a), on or prior to the Maturity Date (i) all
Base Rate Loans shall accrue interest at the Adjusted Base Rate and (ii)
all Eurodollar Loans shall accrue interest at the Adjusted Eurodollar
Rate. If the Borrower exercises its right to extend the Maturity Date in
accordance with Section 3.5(a), then, after the Maturity Date all Term
Loans shall accrue interest (subject to Section 3.1(b)) during the time
periods set forth below at the rates corresponding thereto:
Time Period Interest Rate
From the first anniversary
of the Closing Date through
January 31, 2003 10.00%
From February 1, 2003 through 10.50%
April 30, 2003
From May 1, 2003 through 11.00%
July 31, 2003
From August 1, 2003 to 11.50%
October 7, 2003
Notwithstanding the foregoing, the interest rate for Term Loans
shall not exceed 12% per annum (without giving effect to any default rate
of interest that may apply pursuant to Section 3.1(b)).
(b) Default Rate of Interest. Upon the occurrence, and during the
continuation, of an Event of Default, the principal of and, to the extent
permitted by law, interest on the Term Loans and any other amounts owing
hereunder or under the other Credit Documents (including without
limitation fees and expenses) shall bear interest, payable on demand, at a
per annum rate equal to 2% plus the rate which would otherwise be
applicable (or if no rate is applicable, then, (i) on or prior to the
Maturity Date, interest shall accrue at the Adjusted Base Rate plus 2% per
annum and (ii) after the Maturity Date, interest shall accrue at 13.50%
per annum).
(c) Interest Payments. Interest on Term Loans shall be due and
payable in arrears on each Interest Payment Date.
3.2 PLACE AND MANNER OF PAYMENTS.
All payments of principal, interest, fees, expenses and other amounts to
be made by a Credit Party under this Credit Agreement shall be made
unconditionally and without any setoff, deduction, counterclaim, defense,
recoupment or withholding of any kind and received not later than 2:00 p.m. on
the date when due, in Dollars and in immediately available funds. Payments
received after such time shall be deemed to have been received on the next
Business Day. All such payments shall be made to the Administrative Agent at the
Agency Services Address. The Borrower shall, at the time it makes any payment
under this Credit Agreement, specify to the Administrative Agent the Term Loans,
fees or other amounts payable by the Borrower hereunder to which such payment is
to be applied (and in the event that it fails to
14
specify, or if such application would be inconsistent with the terms hereof, the
Administrative Agent shall, subject to Section 3.7, distribute such payment to
the Lenders in such manner as the Administrative Agent may reasonably deem
appropriate). The Administrative Agent will distribute such payments to the
Lenders on the same Business Day if any such payment is received at or before
2:00 p.m.; otherwise the Administrative Agent may distribute such payment to the
Lenders on the next succeeding Business Day. Whenever any payment hereunder
shall be stated to be due on a day which is not a Business Day, the due date
thereof shall be extended to the next succeeding Business Day (subject to
accrual of interest and fees for the period of such extension), except that, in
the case of Eurodollar Loans (or interest payable with respect thereto), if the
extension would cause the payment to be made in the next following calendar
month, then such payment shall instead be made on the next preceding Business
Day and except as required by Section 3.5(b).
3.3 PREPAYMENTS.
(a) Voluntary Prepayments. The Borrower shall have the right to
prepay the Term Loans in whole or in part from time to time without
premium or penalty; provided, however, that (i) Eurodollar Loans may only
be prepaid on three Business Days' prior written notice to the
Administrative Agent, (ii) each such partial prepayment of Eurodollar
Loans shall be in the minimum principal amount of $1,000,000 and integral
multiples of $1,000,000 and (iii) each such partial prepayment of Base
Rate Loans shall be in the minimum principal amount of $500,000 and
integral multiples of $100,000. Amounts prepaid pursuant to this Section
3.3(a) shall be applied as the Borrower may elect; provided, however, if
the Borrower fails to specify, such prepayment shall be applied by the
Administrative Agent, subject to Section 3.7, in such manner as it deems
reasonably appropriate. All prepayments under this Section 3.3(a) shall be
subject to Section 3.14.
(b) Mandatory Prepayments.
(i) Equity Issuances. Immediately upon receipt by a Credit
Party or any of its Subsidiaries of proceeds from any Equity
Issuance, the Borrower shall prepay Term Loans in an amount equal to
100% of the Net Cash Proceeds of such Equity Issuance (all such
prepayments to be applied as set forth in Section 3.3(c) below).
(ii) Debt Issuances. Immediately upon receipt by a Credit
Party or any of its Subsidiaries of proceeds from any Debt Issuance,
the Borrower shall prepay Term Loans in an amount equal to 100% of
the Net Cash Proceeds of such Debt Issuance (all such prepayments to
be applied as set forth in Section 3.3(c) below).
(c) Application of Prepayments. On or prior to the Maturity Date,
all amounts required to be prepaid pursuant to Section 3.3(b) shall be
applied first to Base Rate Loans and second to Eurodollar Loans in direct
order of Interest Period maturities. After the Maturity Date, all amounts
required to be prepaid pursuant to Section 3.3(b) shall be applied pro
rata to the outstanding Term Loans. All prepayments pursuant to Section
3.3(b) shall be subject to Section 3.14.
3.4 ADMINISTRATIVE FEES.
The Borrower agrees to pay to the Administrative Agent, for its own
account, an annual fee as agreed to between the Borrower and the
Administrative Agent (the "Administrative Fees") in the Fee Letter.
3.5 EXTENSION OF MATURITY DATE; PAYMENT IN FULL AT MATURITY.
(a) So long as no Default or Event of Default shall have occurred
and be continuing on the date of the extension request and on the Maturity
Date, the Borrower shall have the right, upon not less than 30 days' and
not more than 60 days' prior written notice to the Lenders, to extend the
Maturity Date to October 7, 2003 (the "Extended Maturity Date").
(b) On the Maturity Date or, if the Maturity Date has been
extended in accordance with subsection (a) above, on the Extended Maturity
Date, the entire outstanding principal balance of all Term Loans, together
with accrued but unpaid interest and all fees and other sums owing under
the Credit Documents, shall be due and payable in full, unless accelerated
sooner pursuant to Section 7.2; provided that if
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the Maturity Date or the Extended Maturity Date, as applicable, is not a
Business Day, then such principal, interest, fees and other sums shall be
due and payable in full on the next preceding Business Day.
3.6 COMPUTATIONS OF INTEREST AND FEES.
(a) Except for Base Rate Loans that are based upon the Prime Rate,
in which case interest shall be computed on the basis of the actual number
of days elapsed over a year of 365 or 366 days, as the case may be, all
computations of interest and fees hereunder shall be made on the basis of
the actual number of days elapsed over a year of 360 days. Interest shall
accrue from and including the first date of borrowing (or continuation or
conversion) to but excluding the last day occurring in the period for
which such interest is payable.
(b) It is the intent of the Lenders and the Credit Parties to
conform to and contract in strict compliance with applicable usury law
from time to time in effect. All agreements between the Lenders and the
Credit Parties are hereby limited by the provisions of this subsection
which shall override and control all such agreements, whether now existing
or hereafter arising and whether written or oral. In no way, nor in any
event or contingency (including but not limited to prepayment or
acceleration of the maturity of any Credit Party Obligation), shall the
interest taken, reserved, contracted for, charged, or received under this
Credit Agreement, under the Term Notes or otherwise, exceed the maximum
nonusurious amount permissible under applicable law. If, from any possible
construction of any of the Credit Documents or any other document,
interest would otherwise be payable in excess of the maximum nonusurious
amount, any such construction shall be subject to the provisions of this
subsection and such documents shall be automatically reduced to the
maximum nonusurious amount permitted under applicable law, without the
necessity of execution of any amendment or new document. If any Lender
shall ever receive anything of value which is characterized as interest on
the Term Loans under applicable law and which would, apart from this
provision, be in excess of the maximum nonusurious amount, an amount equal
to the amount which would have been excessive interest shall, without
penalty, be applied to the reduction of the principal amount owing on the
Term Loans and not to the payment of interest, or refunded to the Borrower
or the other payor thereof if and to the extent such amount which would
have been excessive exceeds such unpaid principal amount of the Term
Loans. The right to demand payment of the Term Loans or any other
Indebtedness evidenced by any of the Credit Documents does not include the
right to accelerate the payment of any interest which has not otherwise
accrued on the date of such demand, and the Lenders do not intend to
charge or receive any unearned interest in the event of such demand. All
interest paid or agreed to be paid to the Lenders with respect to the Term
Loans shall, to the extent permitted by applicable law, be amortized,
prorated, allocated, and spread throughout the full stated term (including
any renewal or extension) of the Term Loans so that the amount of interest
on account of the Term Loans does not exceed the maximum nonusurious
amount permitted by applicable law.
3.7 PRO RATA TREATMENT.
Except to the extent otherwise provided herein, each Term Loan borrowing,
each payment or prepayment of principal of any Term Loan, each payment of fees
and each conversion or continuation of any Term Loans, shall (except as
otherwise provided in Section 3.11) be allocated pro rata among the relevant
Lenders in accordance with the respective Commitment Percentages of such Lenders
(or, if the Commitments of such Lenders have expired or been terminated, in
accordance with the principal amounts of the outstanding Term Loans of such
Lenders); provided that, if any Lender shall have failed to pay its applicable
pro rata share of any Term Loan, then any amount to which such Lender would
otherwise be entitled pursuant to this Section 3.7 shall instead be payable to
the Administrative Agent until the share of such Term Loan not funded by such
Lender has been repaid; provided further, that in the event any amount paid to
any Lender pursuant to this Section 3.7 is rescinded or must otherwise be
returned by the Administrative Agent, such Lender shall, upon the request of the
Administrative Agent, repay to the Administrative Agent the amount so paid to
such Lender, with interest for the period commencing on the date such payment is
returned by the Administrative Agent until the date the Administrative Agent
receives such repayment at a rate per annum equal to the Federal Funds Rate if
repaid within two (2) Business Days after such request and thereafter the Base
Rate.
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3.8 SHARING OF PAYMENTS.
The Lenders agree among themselves that, except to the extent otherwise
provided herein, in the event that any Lender shall obtain payment in respect of
any Term Loan or any other obligation owing to such Lender under this Credit
Agreement through the exercise of a right of setoff, banker's lien or
counterclaim, or pursuant to a secured claim under Section 506 of the Bankruptcy
Code or other security or interest arising from, or in lieu of, such secured
claim, received by such Lender under any applicable bankruptcy, insolvency or
other similar law or otherwise, or by any other means, in excess of its pro rata
share of such payment as provided for in this Credit Agreement, such Lender
shall promptly pay in cash or purchase from the other Lenders a participation in
such Term Loans and other obligations in such amounts, and make such other
adjustments from time to time, as shall be equitable to the end that all Lenders
share such payment in accordance with their Commitment Percentages (or, if the
Commitments of such Lenders have expired or been terminated, in accordance with
the principal amounts of the outstanding Term Loans of such Lenders). The
Lenders further agree among themselves that if payment to a Lender obtained by
such Lender through the exercise of a right of setoff, banker's lien,
counterclaim or other event as aforesaid shall be rescinded or must otherwise be
restored, each Lender which shall have shared the benefit of such payment shall,
by payment in cash or a repurchase of a participation theretofore sold, return
its share of that benefit (together with its share of any accrued interest
payable with respect thereto) to each Lender whose payment shall have been
rescinded or otherwise restored. The Borrower agrees that any Lender so
purchasing such a participation may, to the fullest extent permitted by law,
exercise all rights of payment, including setoff, banker's lien or counterclaim,
with respect to such participation as fully as if such Lender were a holder of
such Term Loan or other obligation in the amount of such participation. Except
as otherwise expressly provided in this Credit Agreement, if any Lender or the
Administrative Agent shall fail to remit to any other Lender an amount payable
by such Lender or the Administrative Agent to such other Lender pursuant to this
Credit Agreement on the date when such amount is due, such payments shall be
made together with interest thereon for each date from the date such amount is
due until the date such amount is paid to the Administrative Agent or such other
Lender at a rate per annum equal to the Federal Funds Rate. If under any
applicable bankruptcy, insolvency or other similar law, any Lender receives a
secured claim in lieu of a setoff to which this Section 3.8 applies, such Lender
shall, to the extent practicable, exercise its rights in respect of such secured
claim in a manner consistent with the rights of the Lenders under this Section
3.8 to share in the benefits of any recovery on such secured claim.
3.9 CAPITAL ADEQUACY.
If any Lender determines that the introduction after the Closing Date of
any law, rule or regulation or other Requirement of Law regarding capital
adequacy or any change therein or in the interpretation thereof, or compliance
by such Lender (or its Lending Office) therewith, has or would have the effect
of reducing the rate of return on the capital or assets of such Lender or any
corporation controlling such Lender as a consequence of such Lender's
obligations hereunder (taking into consideration its policies with respect to
capital adequacy and such Lender's desired return on capital), then from time to
time upon demand of such Lender (with a copy of such demand to the
Administrative Agent), the Borrower shall pay to such Lender such additional
amounts as will compensate such Lender for such reduction.
3.10 EURODOLLAR PROVISIONS.
If the Administrative Agent determines (which determination shall be
conclusive and binding upon the Borrower) in connection with any request for a
Eurodollar Loan or a conversion to or continuation thereof that (a) Dollar
deposits are not being offered to banks in the applicable offshore Dollar market
for the applicable amount and Interest Period of such Eurodollar Loan, (b)
adequate and reasonable means do not exist for determining the Eurodollar Rate
for such Eurodollar Loan or (c) the Eurodollar Rate for such Eurodollar Loan
does not adequately and fairly reflect the cost to the Lenders of funding such
Eurodollar Loan, the Administrative Agent will promptly notify the Borrower and
the Lenders. Thereafter, the obligation of the Lenders to make or maintain
Eurodollar Loans shall be suspended until the Administrative Agent revokes such
notice. Upon receipt of such notice, the Borrower may revoke any pending Notice
of Borrowing or Notice of Continuation/Conversion with respect to Eurodollar
Loans or, failing that, will be deemed to have converted such request into a
request for a borrowing of or conversion into a Base Rate Loan in the amount
specified therein.
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3.11 ILLEGALITY.
If any Lender determines that any Requirement of Law has made it unlawful,
or that any Governmental Authority has asserted that it is unlawful, for any
Lender or its applicable Lending Office to make, maintain or fund Eurodollar
Loans, or materially restricts the authority of such Lender to purchase or sell,
or to take deposits of, Dollars in the applicable offshore Dollar market, or to
determine or charge interest rates based upon the Eurodollar Rate, then, on
notice thereof by such Lender to the Borrower through the Administrative Agent,
any obligation of such Lender to make or continue Eurodollar Loans or to convert
Base Rate Loans to Eurodollar Loans shall be suspended until such Lender
notifies the Administrative Agent and the Borrower that the circumstances giving
rise to such determination no longer exist. Upon receipt of such notice, the
Borrower shall, upon demand to the Borrower from such Lender (with a copy to the
Administrative Agent), prepay or, if applicable, convert all Eurodollar Loans of
such Lender to Base Rate Loans, either on the last day of the Interest Period
thereof, if such Lender may lawfully continue to maintain such Eurodollar Loans
to such day, or immediately, if such Lender may not lawfully continue to
maintain such Eurodollar Loans. Upon any such prepayment or conversion, the
Borrower shall also pay interest on the amount so prepaid or converted, together
with any amounts due with respect thereto pursuant to Section 3.14.
3.12 REQUIREMENTS OF LAW.
If any Lender determines that as a result of the introduction of or any
change in, or in the interpretation of, any Requirement of Law, or such Lender's
compliance therewith, there shall be any increase in the cost to such Lender of
agreeing to make or making, funding or maintaining Eurodollar Loans, or a
reduction in the amount received or receivable by such Lender in connection with
any of the foregoing (excluding for purposes of this Section 3.12 any such
increased costs or reduction in amount resulting from (i) Taxes or Other Taxes
(as to which Section 3.13 shall govern) and (ii) reserve requirements utilized
in the determination of the Eurodollar Rate), then from time to time, upon
demand of such Lender (through the Administrative Agent), the Borrower shall pay
to such Lender such additional amounts as will compensate such Lender for such
increased cost or reduction in yield.
3.13 TAXES.
(a) Any and all payments by a Credit Party to or for the account
of the Administrative Agent or any Lender under any Credit Document shall
be made free and clear of and without deduction for any and all present or
future income, stamp or other taxes, duties, levies, imposts, deductions,
assessments, fees, withholdings or similar charges, and all liabilities
with respect thereto, but excluding, in the case of the Administrative
Agent and each Lender, taxes imposed on or measured by its net income, and
franchise taxes imposed on it (in lieu of net income taxes), by the
jurisdiction (or any political subdivision thereof) under the laws of
which the Administrative Agent or such Lender, as the case may be, is
organized or maintains its Lending Office (all such non-excluded present
or future income, stamp or other taxes, duties, levies, imposts,
deductions, assessments, fees, withholdings or similar charges, and
liabilities being hereinafter referred to as "Taxes"). If a Credit Party
shall be required by any Requirement of Law to deduct any Taxes from or in
respect of any sum payable under any Credit Document to the Administrative
Agent or any Lender, (i) the sum payable shall be increased as necessary
so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 3.13(a)), the
Administrative Agent or such Lender, as the case may be, receives an
amount equal to the sum it would have received had no such deductions been
made, (ii) such Credit Party shall make such deductions, (iii) such Credit
Party shall pay the full amount deducted to the relevant taxation
authority or other Governmental Authority in accordance with applicable
Requirements of Law, and (iv) within 30 days after the date of such
payment, such Credit Party shall furnish to the Administrative Agent
(which shall forward the same to such Lender, if applicable) the original
or a certified copy of a receipt evidencing payment thereof, to the extent
such receipt is issued therefor, or other written proof of payment thereof
that is reasonably satisfactory to the Administrative Agent.
(b) In addition, each Credit Party agrees to pay any and all
present or future stamp, court or documentary taxes and any other excise
or property taxes or charges or similar levies which arise from any
payment made under any Credit Document or from the execution, delivery,
performance, enforcement or
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registration of, or otherwise with respect to, any Credit Document
(hereinafter referred to as "Other Taxes").
(c) If a Credit Party shall be required to deduct or pay any Taxes
or Other Taxes from or in respect of any sum payable under any Credit
Document to the Administrative Agent or any Lender, such Credit Party
shall also pay to the Administrative Agent (for the account of such
Lender) or to such Lender, at the time interest is paid, such additional
amount that such Lender specifies as necessary to preserve the after-tax
yield (after factoring in all taxes, including taxes imposed on or
measured by net income) such Lender would have received if such Taxes or
Other Taxes had not been imposed.
(d) Each Credit Party agrees to indemnify the Administrative Agent
and each Lender for (i) the full amount of Taxes and Other Taxes
(including any Taxes or Other Taxes imposed or asserted by any
jurisdiction on amounts payable under this Section 3.13(d)) paid by the
Administrative Agent and such Lender, and (ii) any liability (including
penalties, interest and expenses) arising therefrom or with respect
thereto.
(e) In the case of any payment hereunder or under any other Credit
Document by or on behalf of a Credit Party through an account or branch
outside the United States, or on behalf of a Credit Party by a payor that
is not a United States person, if such Credit Party determines that no
taxes are payable in respect thereof, such Credit Party shall furnish, or
shall cause such payor to furnish, to the Administrative Agent, an opinion
of counsel reasonably acceptable to the Administrative Agent stating that
such payment is exempt from Taxes. For purposes of this subsection (e),
the terms "United States" and "United States person" shall have the
meanings specified in Section 7701 of the Code.
(f) Each Lender that is a foreign corporation, foreign partnership
or foreign trust within the meaning of the Code shall deliver to the
Administrative Agent, prior to receipt of any payment subject to
withholding under the Code, two duly signed completed copies of either IRS
Form W-8BEN or any successor thereto (relating to such Lender and
entitling it to an exemption from, or reduction of, withholding tax on all
payments to be made to such Lender by the Credit Parties pursuant to this
Credit Agreement), as appropriate, or IRS Form W-8ECI or any successor
thereto (relating to all payments to be made to such Lender by a Credit
Party pursuant to this Credit Agreement) or such other evidence
satisfactory to the Borrower and the Administrative Agent that such Lender
is entitled to an exemption from, or reduction of, United States
withholding tax. Thereafter and from time to time, each such Lender shall
(i) promptly submit to the Administrative Agent such additional duly
completed and signed copies of one of such forms (or such successor forms
as shall be adopted from time to time by the relevant United States taxing
authorities), as appropriate, as may reasonably be requested by the
Borrower or the Administrative Agent and then be available under then
current United States laws and regulations to avoid, or such evidence as
is satisfactory to the Borrower and the Administrative Agent of any
available exemption from or reduction of, United States withholding taxes
in respect of all payments to be made to such Lender by the Borrower
pursuant to this Credit Agreement, (ii) promptly notify the Administrative
Agent of any change in circumstances which would modify or render invalid
any claimed exemption or reduction, and (iii) take such steps as shall not
be materially disadvantageous to it, in the reasonable judgment of such
Lender, and as may be reasonably necessary (including the re-designation
of its Lending Office) to avoid any Requirement of Law that the Credit
Parties make any deduction or withholding for taxes from amounts payable
to such Lender. If the forms or other evidence provided by such Lender at
the time such Lender first becomes a party to this Credit Agreement
indicate a United States interest withholding tax rate in excess of zero,
withholding tax at such rate shall be considered excluded from Taxes
unless and until such Lender provides the appropriate forms certifying
that a lesser rate applies, whereupon withholding tax at such lesser rate
only shall be considered excluded from Taxes for periods governed by such
forms; provided, however, that, if at the date of any assignment pursuant
to which a Lender becomes a party to this Credit Agreement, the assignor
Lender was entitled to payments under Section 3.13(a) in respect of United
States withholding tax with respect to interest paid at such date, then,
to such extent, the term Taxes shall include (in addition to withholding
taxes that may be imposed in the future or other amounts otherwise
includable in Taxes) United States withholding tax, if any, applicable
with respect to the assignee Lender on such date. If such Lender fails to
deliver the above forms or other evidence, then the Administrative Agent
may withhold from any interest payment to such Lender an
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amount equal to the applicable withholding tax imposed by Sections 1441
and 1442 of the Code, without reduction. If any Governmental Authority
asserts that the Administrative Agent did not properly withhold any tax or
other amount from payments made in respect of such Lender, such Lender
shall indemnify the Administrative Agent therefor, including all penalties
and interest, any taxes imposed by any jurisdiction on the amounts payable
to the Administrative Agent under this Section 3.13(f), and costs and
expenses (including Attorney Costs) of the Administrative Agent. For any
period with respect to which a Lender has failed to provide the Borrower
with the above forms or other evidence (other than if such failure is due
to a change in the applicable law, or in the interpretation or application
thereof, occurring after the date on which such form or other evidence
originally was required to be provided or if such form or other evidence
otherwise is not required), such Lender shall not be entitled to
indemnification under subsection (a) or (c) of this Section 3.13 with
respect to Taxes imposed by the United States by reason of such failure;
provided, however, that should a Lender become subject to Taxes because of
its failure to deliver such form or other evidence required hereunder, the
Borrower shall take such steps as such Lender shall reasonably request to
assist such Lender in recovering such Taxes. The obligation of the Lenders
under this Section 3.13(f) shall survive the payment of all Credit Party
Obligations and the resignation or replacement of the Administrative
Agent.
(g) In the event that an additional payment is made under Section
3.13(a) or (c) for the account of any Lender and such Lender, in its
reasonable judgment, determines that it has finally and irrevocably
received or been granted a credit against or release or remission for, or
repayment of, any tax paid or payable by it in respect of or calculated
with reference to the deduction or withholding giving rise to such
payment, such Lender shall, to the extent that it determines that it can
do so without prejudice to the retention of the amount of such credit,
relief, remission or repayment, pay to the Borrower such amount as such
Lender shall, in its reasonable judgment, have determined to be
attributable to such deduction or withholding and which will leave such
Lender (after such payment) in no worse position than it would have been
in if the Borrower had not been required to make such deduction or
withholding. Nothing herein contained shall interfere with the right of a
Lender to arrange its tax affairs in whatever manner it thinks fit nor
oblige any Lender to claim any tax credit or to disclose any information
relating to its tax affairs or any computations in respect thereof or
require any Lender to do anything that would prejudice its ability to
benefit from any other credits, reliefs, remissions or repayments to which
it may be entitled.
3.14 COMPENSATION.
Upon the written demand of any Lender, the Credit Parties shall promptly
compensate such Lender for and hold such Lender harmless from any loss, cost or
expense incurred by it as a result of:
(a) any continuation, conversion, payment or prepayment of any
Eurodollar Loan on a day other than the last day of the Interest Period
for such Eurodollar Loan (whether voluntary, mandatory, automatic, by
reason of acceleration, or otherwise); or
(b) any failure by a Borrower (for a reason other than the failure
of such Lender to make a Eurodollar Loan) to prepay, borrow, continue or
convert any Eurodollar Loan on the date or in the amount previously
requested by such Borrower.
The amount each such Lender shall be compensated pursuant to this Section 3.14
shall include, without limitation, (i) any loss incurred by such Lender in
connection with the re-employment of funds prepaid, repaid, not borrowed or
paid, as the case may be and (ii) any reasonable out-of-pocket expenses
(including Attorney Costs) incurred and reasonably attributable thereto.
For purposes of calculating amounts payable by the Borrower to the Lenders under
this Section 3.14, each Lender may deem that it funded each Eurodollar Loan made
by it in Dollars at the Eurodollar Rate for such Eurodollar Loan by a matching
deposit or other borrowing in the applicable offshore Dollar interbank market
for a comparable amount and for a comparable period, whether or not such
Eurodollar Loan was in fact so funded.
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3.15 DETERMINATION AND SURVIVAL OF PROVISIONS.
All determinations by the Administrative Agent or a Lender of amounts
owing under Sections 3.9 through 3.14, inclusive, shall, absent manifest error,
be conclusive and binding on the parties hereto and all amounts owing thereunder
shall be due and payable within ten Business Days of demand therefor. In
determining such amount, the Administrative Agent or such Lender may use any
reasonable averaging and attribution methods. Section 3.9 through 3.14,
inclusive, shall survive the termination of this Credit Agreement and the
payment of all Credit Party Obligations.
SECTION 4
GUARANTY
4.1 GUARANTY OF PAYMENT.
Subject to Section 4.7 below, each of the Guarantors hereby, jointly and
severally, unconditionally guarantees to each Lender, each Affiliate of a Lender
that enters into a Hedging Agreement and the Administrative Agent the prompt
payment of the Credit Party Obligations in full when due (whether at stated
maturity, as a mandatory prepayment, by acceleration or otherwise) and the
timely performance of all other obligations under the Credit Documents and such
Hedging Agreements. This Guaranty is a guaranty of payment and not of collection
and is a continuing guaranty and shall apply to all Credit Party Obligations
whenever arising.
4.2 OBLIGATIONS UNCONDITIONAL.
The obligations of the Guarantors hereunder are absolute and
unconditional, irrespective of the value, genuineness, validity, regularity or
enforceability of any of the Credit Documents or the Hedging Agreements, or any
other agreement or instrument referred to therein, to the fullest extent
permitted by applicable law, irrespective of any other circumstance whatsoever
which might otherwise constitute a legal or equitable discharge or defense of a
surety or guarantor. Each Guarantor agrees that this Guaranty may be enforced by
the Lenders without the necessity at any time of resorting to or exhausting any
other security or collateral and without the necessity at any time of having
recourse to the Term Notes or any other of the Credit Documents or any
collateral, if any, hereafter securing the Credit Party Obligations or otherwise
and each Guarantor hereby waives the right to require the Lenders to proceed
against the Borrower or any other Person (including a co-guarantor) or to
require the Lenders to pursue any other remedy or enforce any other right. Each
Guarantor further agrees that it shall have no right of subrogation, indemnity,
reimbursement or contribution against the Borrower or any other Guarantor of the
Credit Party Obligations for amounts paid under this Guaranty until such time as
the Lenders (and any Affiliates of Lenders entering into Hedging Agreements)
have been paid in full and all Commitments under the Credit Agreement have been
terminated. Each Guarantor further agrees that nothing contained herein shall
prevent the Administrative Agent or the Lenders from suing on the Term Notes or
any of the other Credit Documents or any of the Hedging Agreements, or
foreclosing their security interest in or Lien on any collateral, if any,
securing the Credit Party Obligations, or from exercising any other rights
available to them under this Credit Agreement, the Term Notes, any other of the
Credit Documents, or any other instrument of security, if any, and the exercise
of any of the aforesaid rights and the completion of any foreclosure proceedings
shall not constitute a discharge of any Guarantor's obligations hereunder; it
being the purpose and intent of each Guarantor that its obligations hereunder
shall be absolute, independent and unconditional under any and all
circumstances. Neither any Guarantor's obligations under this Guaranty nor any
remedy for the enforcement thereof shall be impaired, modified, changed or
released in any manner whatsoever by an impairment, modification, change,
release or limitation of the liability of the Borrower or by reason of the
bankruptcy or insolvency of the Borrower. Each Guarantor waives any and all
notice of the creation, renewal, extension or accrual of any of the Credit Party
Obligations and notice of or proof of reliance by the Administrative Agent or
any Lender upon this Guaranty or acceptance of this Guaranty. The Credit Party
Obligations, and any of them, shall conclusively be deemed to have been created,
contracted or incurred, or renewed, extended, amended or waived, in reliance
upon this Guaranty. All dealings between the Borrower and the Guarantors, on the
one hand, and the Administrative Agent and the Lenders, on the other hand,
likewise shall be conclusively presumed to have been had or consummated in
reliance upon this Guaranty. The Guarantors further agree to all rights of
set-off as set forth in Section 9.2 and agree that their obligations are secured
pursuant to the Collateral Documents.
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4.3 MODIFICATIONS.
Each Guarantor agrees that (a) all or any part of the Collateral, if any,
now or hereafter held for the Credit Party Obligations, may be exchanged,
compromised or surrendered from time to time; (b) the Lenders shall not have any
obligation to protect, perfect, secure or insure any such security interests,
Liens or encumbrances now or hereafter held, if any, for the Credit Party
Obligations or the Properties subject thereto; (c) the time or place of payment
of the Credit Party Obligations may be changed or extended, in whole or in part,
to a time certain or otherwise, and may be renewed or accelerated, in whole or
in part; (d) the Borrower and any other party liable for payment under the
Credit Documents may be granted indulgences generally; (e) any of the provisions
of the Term Notes or any of the other Credit Documents may be modified, amended
or waived; (f) any party (including any co-guarantor) liable for the payment
thereof may be granted indulgences or be released; and (g) any deposit balance
for the credit of the Borrower or any other party liable for the payment of the
Credit Party Obligations or liable upon any security therefor may be released,
in whole or in part, at, before or after the stated, extended or accelerated
maturity of the Credit Party Obligations, all without notice to or further
assent by such Guarantor, which shall remain bound thereon, notwithstanding any
such exchange, compromise, surrender, extension, renewal, acceleration,
modification, indulgence or release.
4.4 WAIVER OF RIGHTS.
Each Guarantor expressly waives to the fullest extent permitted by
applicable law: (a) notice of acceptance of this Guaranty by the Administrative
Agent and the Lenders and of all Term Loans made to the Borrower by the Lenders;
(b) presentment and demand for payment or performance of any of the Credit Party
Obligations; (c) protest and notice of dishonor or of default (except as
specifically required in the Credit Agreement) with respect to the Credit Party
Obligations or with respect to any security therefor; (d) notice of the Lenders
obtaining, amending, substituting for, releasing, waiving or modifying any
security interest, Lien or encumbrance, if any, hereafter securing the Credit
Party Obligations, or the Lenders' subordinating, compromising, discharging or
releasing such security interests, Liens or encumbrances, if any; and (e) all
other notices to which such Guarantor might otherwise be entitled.
4.5 REINSTATEMENT.
The obligations of the Guarantors under this Section 4 shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Credit Party Obligations is
rescinded or must be otherwise restored by any holder of any of the Credit Party
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and each Guarantor agrees that it will indemnify
the Administrative Agent and each Lender on demand for all reasonable costs and
expenses (including, without limitation, reasonable Attorney Costs) incurred by
the Administrative Agent or such Lender in connection with such rescission or
restoration, including any such costs and expenses incurred in defending against
any claim alleging that such payment constituted a preference, fraudulent
transfer or similar payment under any bankruptcy, insolvency or similar law.
4.6 REMEDIES.
The Guarantors agree that, as between the Guarantors, on the one hand, and
the Administrative Agent and the Lenders, on the other hand, the Credit Party
Obligations may be declared to be forthwith due and payable as provided in
Section 7.2 (and shall be deemed to have become automatically due and payable in
the circumstances provided in Section 7.2) notwithstanding any stay, injunction
or other prohibition preventing such declaration (or preventing such Credit
Party Obligations from becoming automatically due and payable) as against any
other Person and that, in the event of such declaration (or such Credit Party
Obligations being deemed to have become automatically due and payable), such
Credit Party Obligations (whether or not due and payable by any other Person)
shall forthwith become due and payable by the Guarantors.
4.7 LIMITATION OF GUARANTY.
Notwithstanding any provision to the contrary contained herein or in any
of the other Credit Documents, to the extent the obligations of any 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 such Guarantor
hereunder shall be limited to the maximum amount that is permissible under
applicable law (whether federal or state or otherwise and including, without
limitation, the Bankruptcy Code).
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4.8 RIGHTS OF CONTRIBUTION.
The Credit Parties agree among themselves that, in connection with
payments made hereunder, each Credit Party shall have contribution rights
against the other Credit Parties as permitted under applicable law. Such
contribution rights shall be subordinate and subject in right of payment to the
obligations of the Credit Parties under the Credit Documents and no Credit Party
shall exercise such rights of contribution until all Credit Party Obligations
have been paid in full and the Commitments terminated.
SECTION 5
CONDITIONS PRECEDENT
5.1 CLOSING CONDITIONS.
The obligation of the Lenders to enter into this Credit Agreement and make
the initial Term Loans is subject to satisfaction (or waiver) of the following
conditions:
(a) Executed Credit Documents. Receipt by the Administrative Agent
of duly executed copies of: (i) this Credit Agreement; (ii) the Term
Notes; (iii) the Collateral Documents, (iv) the Intercreditor Agreement
and (v) all other Credit Documents, each in form and substance reasonably
acceptable to the Lenders in their sole discretion.
(b) Authority Documents. Receipt by the Administrative Agent of
the following with respect to each Credit Party:
(i) Organizational Documents. Copies of the articles or
certificates of incorporation or other organizational documents of
such Credit Party certified to be true and complete as of a recent
date by the appropriate Governmental Authority of the state or other
jurisdiction of its formation and certified by a secretary or
assistant secretary (or the equivalent) of such Credit Party to be
true and correct as of the Closing Date.
(ii) Bylaws. A copy of the bylaws or other governing
documents of such Credit Party certified by a secretary or assistant
secretary (or the equivalent) of such Credit Party to be true and
correct as of the Closing Date.
(iii) Resolutions. Copies of resolutions of the Board of
Directors or other governing body of such Credit Party approving and
adopting the Credit Documents to which it is a party, the
transactions contemplated herein and therein and authorizing
execution and delivery thereof, certified by a secretary or
assistant secretary (or the equivalent) of such Credit Party to be
true and correct and in full force and effect as of the Closing
Date.
(iv) Good Standing. Copies of certificates of good standing,
existence or its equivalent with respect to such Credit Party
certified as of a recent date by the appropriate Governmental
Authority of the state or other jurisdiction of its formation and
each other jurisdiction in which the failure to qualify and be in
good standing would have a Material Adverse Effect.
(v) Incumbency. An incumbency certificate of such Credit
Party certified by a secretary or assistant secretary (or the
equivalent) of such Credit Party to be true and correct as of the
Closing Date.
(c) Opinions of Counsel.
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(i) Receipt by the Administrative Agent of an opinion of
counsel to the Credit Parties reasonably satisfactory to the
Administrative Agent, addressed to the Administrative Agent and the
Lenders and dated as of the Closing Date.
(ii) Receipt by the Administrative Agent of a copy of each
legal opinion (other than tax opinions) required to be delivered
pursuant to the Agreement and Plan of Merger, if any, together with
a letter from the law firm providing such legal opinion authorizing
the Administrative Agent and the Lenders to rely on such legal
opinion or evidence that such legal opinion authorizes such
reliance, in form and substance reasonably satisfactory to the
Administrative Agent.
(d) Financial Statements. Receipt by the Administrative Agent of
(i) the annual consolidated financial statements (including balance
sheets, income statements and cash flow statements) of the Credit Parties
and their Subsidiaries for the fiscal years 1999 and 2000 audited by
independent public accountants of recognized national standing and
prepared in conformity with GAAP, together with any "management letter" or
presentation submitted by such accountants in connection with such
financial statements, (ii) the consolidated financial statements
(including balance sheets, income statements and cash flow statements) of
the Credit Parties and their Subsidiaries for the fiscal quarter ended
September 30, 2001 and (iii) such additional financial statements,
information and projections regarding the Credit Parties and their
Subsidiaries as the Administrative Agent may request, in each case in form
and substance reasonably satisfactory to the Administrative Agent.
(e) Due Diligence. The Administrative Agent and the Lenders shall
have completed all due diligence with respect to the Credit Parties, their
Subsidiaries and the Managed Practices, the transactions contemplated by
this Credit Agreement and the other Credit Documents and the OrthAlliance
Acquisition in scope and determination reasonably satisfactory to the
Administrative Agent and the Lenders.
(f) Material Adverse Effect. Since December 31, 2000, there shall
have been no development or event relating to or affecting a Credit Party
or any of its Subsidiaries that has had or could be reasonably expected to
have a Material Adverse Effect and no Material Adverse Change in the facts
and information regarding the Credit Parties and their Subsidiaries as
represented to date (other than in each case as previously disclosed in
writing to the Administrative Agent).
(g) Litigation. There shall not exist any order, decree, judgment,
ruling or injunction or any pending or threatened action, suit,
investigation or proceeding (i) which restrains the consummation of the
OrthAlliance Acquisition in the manner contemplated by the Agreement and
Plan of Merger or any transaction contemplated by the Credit Documents or
(ii) against the Credit Parties and their Subsidiaries taken as a whole
or, to the knowledge of any Credit Party, any Managed Practice (other than
in each case as previously disclosed in writing to the Administrative
Agent) that could have or be reasonably expected to have a Material
Adverse Effect.
(h) Consents. Receipt by the Administrative Agent of evidence that
all necessary governmental, shareholder and third party consents and
approvals, if any, with respect to this Credit Agreement and the Credit
Documents and the transactions contemplated herein and therein, and with
respect to the OrthAlliance Acquisition, have been received and no
condition or Requirement of Law exists which would reasonably be likely to
restrain, prevent or impose any material adverse conditions on the
transactions contemplated hereby and by the other Credit Documents or the
OrthAlliance Acquisition.
(i) Officer's Certificates. Receipt by the Administrative Agent of
a certificate or certificates executed by an Authorized Officer of the
Borrower as of the Closing Date stating that (i) the Credit Parties and
each of their Subsidiaries are in compliance in all material respects with
all existing material financial obligations and all material Requirements
of Law, (ii) there does not exist any order, decree, judgment, ruling or
injunction or any pending or threatened action, suit, investigation or
proceeding (A) which restrains the consummation of the OrthAlliance
Acquisition in the manner contemplated by the Agreement and Plan of Merger
or any transaction contemplated by the Credit Documents or (B) against the
Credit Parties and their Subsidiaries taken as a whole or, to the
knowledge of any Credit Party after due inquiry, any Managed Practice
(other than in each case as previously disclosed in writing to the
Administrative Agent) that could
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have or be reasonably expected to have a Material Adverse Effect, (iii)
the financial statements and information delivered to the Administrative
Agent on or before the Closing Date were prepared in good faith and in
accordance with GAAP, (iv) all conditions to the effectiveness of the
Revolving Senior Credit Agreement have been satisfied or waived and (v)
immediately after giving effect to this Credit Agreement, the other Credit
Documents and all the transactions contemplated herein or therein to occur
on such date, (A) each Credit Party is Solvent and the Credit Parties and
their Subsidiaries taken as a whole are Solvent, (B) no Default or Event
of Default exists, (C) all representations and warranties contained herein
and in the other Credit Documents are true and correct in all material
respects, (D) since December 31, 2000, there has been no development or
event relating to or affecting a Credit Party or any of its Subsidiaries
that has had or could be reasonably expected to have a Material Adverse
Effect and there exists no event, condition or state of facts that could
result in or reasonably be expected to result in a Material Adverse
Change, except as disclosed in writing to the Administrative Agent prior
to the date of this Credit Agreement and (E) the Credit Parties are in
compliance with each of the financial covenants set forth in Article VII
of the Incorporated Covenants (x) as of September 30, 2001 and (y) on a
pro forma basis, as of the Closing Date after giving effect to the
transactions contemplated by the Credit Documents and the OrthAlliance
Acquisition.
(j) Revolving Senior Credit Agreement. Receipt by the
Administrative Agent of an amendment to the Revolving Senior Credit
Agreement (the "Second Amendment") on terms reasonably satisfactory to the
Administrative Agent and satisfactory evidence that such amendment has
been consummated or is being simultaneously consummated with this Credit
Agreement.
(k) Collateral. Receipt by the Administrative Agent of the
following (in form and substance satisfactory to the Administrative
Agent):
(i) searches of Uniform Commercial Code filings in the
jurisdiction of the chief executive office and state of organization
of each Credit Party and/or the Collateral and each jurisdiction
where a filing would need to be made in order to perfect the
Lenders' security interest in the Collateral, copies of the
financing statements on file in such jurisdictions and evidence that
no Liens exist with respect to the Collateral other than Permitted
Liens;
(ii) duly executed UCC financing statements for each
appropriate jurisdiction as is necessary, in the Administrative
Agent's sole discretion, to perfect the Lenders' security interest
in the Collateral;
(iii) a letter from the Collateral Agent confirming its
possession, on behalf of the Lenders and the Revolver Lenders, of
(A) all stock certificates and Intercompany Notes evidencing the
Collateral pledged to the Lenders pursuant to the Pledge and
Security Agreement and (B) duly executed allonges and in blank
undated stock powers with respect to such Intercompany Notes and
stock certificates; and
(iv) such other collateral documentation as may be required
by the Administrative Agent in its sole reasonable discretion in
order to perfect and protect the Lenders' security interest in the
Collateral.
(l) OrthAlliance Acquisition. The OrthAlliance Acquisition shall
have been consummated in all material respects in accordance with the
Agreement and Plan of Merger filed as an exhibit to the Borrower's
Registration Statement on Form S-4 as filed on October 5, 2001 with the
Securities and Exchange Commission, with such changes as the
Administrative Agent shall approve in its sole discretion.
(m) Payoff Letters. Receipt by the Administrative Agent of payoff
letters with respect to the Terminating OrthAlliance Indebtedness (as
defined in the Second Amendment), in form and substance reasonably
satisfactory to the Administrative Agent.
(n) Fees and Expenses. Payment by the Credit Parties of all fees
and expenses owed by them to the Administrative Agent and the Lenders on
or before the Closing Date, including, without limitation, as set forth in
the Fee Letter.
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(o) Other. Receipt by the Lenders of such other documents,
instruments, agreements or information as reasonably requested by any
Lender.
5.2 CONDITIONS TO ALL EXTENSIONS OF CREDIT.
In addition to the conditions precedent stated elsewhere herein, the
Lenders shall not be obligated to make Term Loans unless:
(a) Notice. The Borrower shall have delivered to the
Administrative Agent an appropriate Notice of Borrowing, duly executed and
completed, on the Closing Date with respect to the initial Term Loans and
by the time specified in Section 2.1(b) with respect to the Second
Borrowing, if any.
(b) Representations and Warranties. The representations and
warranties made by the Credit Parties in any Credit Document are true and
correct in all material respects at and as if made as of such date except
to the extent they expressly and exclusively relate to an earlier date.
(c) No Default. No Default or Event of Default shall exist and be
continuing either prior to or after giving effect to such Term Loans.
(d) Availability. Immediately after giving effect to the making of
a Term Loan (and the application of the proceeds thereof), the sum of the
outstanding Term Loans shall not exceed the Committed Amount.
(e) Pro Forma Compliance with Financial Covenants. Immediately
after giving effect to the making of a Term Loan (and the application of
the proceeds thereof), the Credit Parties shall be in compliance, on a Pro
Forma Basis, with each of the financial covenants set forth in Article VII
of the Incorporated Covenants.
The delivery of each Notice of Borrowing shall constitute a representation and
warranty by the Borrower of the correctness of the matters specified in
subsections (b), (c), (d) and (e) above. If requested by the Administrative
Agent, the Borrower shall provide detailed calculations demonstrating compliance
with subsection (e) above.
SECTION 6
REPRESENTATIONS, WARRANTIES AND COVENANTS
6.1 REPRESENTATIONS AND WARRANTIES.
Each Credit Party represents and warrants as follows:
(a) Corporate Organization and Power. Each of the Credit Parties
(i) is a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation, (ii) has the full
corporate power and authority to execute, deliver and perform the Credit
Documents to which it is or will be a party, to own and hold its property
and to engage in its business as presently conducted, and (iii) is duly
qualified to do business as a foreign corporation and is in good standing
in each jurisdiction where the nature of its business or the ownership of
its properties requires it to be so qualified, except where the failure to
be so qualified would not, individually or in the aggregate, be reasonably
likely to have a Material Adverse Effect.
(b) Authorization; Enforceability. Each of the Credit Parties has
taken, or on the Closing Date will have taken, all necessary corporate
action to execute, deliver and perform each of the Credit Documents to
which it is or will be a party, and has, or on the Closing Date (or any
later date of execution and delivery) will have, validly executed and
delivered each of the Credit Documents to which it is or will be a party.
This Credit Agreement constitutes, and each of the other Credit Documents
upon execution and
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delivery will constitute, the legal, valid and binding obligation of each
of the Credit Parties that is a party hereto or thereto, enforceable
against it in accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors' rights generally, by general equitable
principles or by principles of good faith and fair dealing.
(c) No Violation. The execution, delivery and performance by each
of the Credit Parties and its Subsidiaries of this Credit Agreement and
each of the other Credit Documents to which it is or will be a party, and
compliance by it with the terms hereof and thereof, do not and will not
(i) violate any provision of its articles or certificate of incorporation
or bylaws or contravene any other Requirement of Law applicable to it,
(ii) conflict with, result in a breach of or constitute (with notice,
lapse of time or both) a default under any material indenture, agreement
(including, without limitation, any Service Agreement) or other instrument
to which it is a party, by which it or any of its properties is bound or
to which it is subject, (iii) result in a Limitation on any Licenses
applicable to the business, operations or properties of such Credit Party
or any of its Subsidiaries or any Managed Practice or adversely affect the
ability of such Credit Party or any of its Subsidiaries or any Managed
Practice to participate in any Third Party Payor Arrangement, or (iv)
except for the Liens granted in favor of the Administrative Agent pursuant
to the Pledge and Security Agreements, result in or require the creation
or imposition of any Lien upon any of its properties or assets. No
Subsidiary is a party to any agreement or instrument or otherwise subject
to any restriction or encumbrance that restricts or limits its ability to
make dividend payments or other distributions in respect of its Capital
Stock, to repay Indebtedness owed to the Borrower or any other Subsidiary,
to make loans or advances to the Borrower or any other Subsidiary, or to
transfer any of its assets or properties to the Borrower or any other
Subsidiary, in each case other than such restrictions or encumbrances
existing under or by reason of the Credit Documents or applicable
Requirements of Law or as expressly permitted under Section 8.10 of the
Incorporated Covenants.
(d) Governmental and Third-Party Authorization; Permits.
(i) No consent, approval, authorization or other action by,
notice to, or registration or filing with, any Governmental
Authority or other Person is or will be required as a condition to
or otherwise in connection with the due execution, delivery and
performance by each of the Credit Parties and its Subsidiaries of
this Credit Agreement or any of the other Credit Documents to which
it is or will be a party or the legality, validity or enforceability
hereof or thereof.
(ii) Each of the Credit Parties and its Subsidiaries and, to
the knowledge of the Credit Parties, each Managed Practice, has, and
is in good standing with respect to, all governmental approvals,
permits and other Licenses and (to the extent applicable) all
Reimbursement Approvals necessary to conduct its business as
presently conducted and to own or lease and operate its Properties,
except for those the failure to obtain which would not be reasonably
likely, individually or in the aggregate, to have a Material Adverse
Effect. There is no pending or, to the knowledge of Credit Parties,
threatened Limitation of any such approval, permit or other License
or Reimbursement Approval of the Credit Parties or any Subsidiary
thereof or any Managed Practice, except for such Limitations as
would not be reasonably likely, individually or in the aggregate, to
have a Material Adverse Effect.
(e) Litigation. There are no actions, investigations, suits or
proceedings pending or, to the knowledge of the Credit Parties,
threatened, at law, in equity or in arbitration, before any court, other
Governmental Authority or other Person, (i) against or affecting any
Credit Party or any of its Subsidiaries or, to the knowledge of the Credit
Parties, any Managed Practice, or any of their respective properties that
would, if adversely determined, be reasonably likely to have a Material
Adverse Effect, except as disclosed in writing to the Administrative Agent
prior to the date of this Agreement, (ii) with respect to any Service
Agreement that would, if adversely determined, be reasonably likely to
have a Material Adverse Effect, except as disclosed in writing to the
Administrative Agent prior to the date of this Agreement, or (iii) with
respect to this Credit Agreement or any of the other Credit Documents.
(f) Proceeds. The proceeds of the Term Loans will be used solely
(i) for working capital, capital expenditures and other lawful corporate
purposes and (ii) to finance the repayment of outstanding
27
Indebtedness of OrthAlliance in connection with the OrthAlliance
Acquisition.
(g) Subsidiaries. Except for Subsidiaries of the Borrower existing
prior to the Closing Date which are inactive and have no assets, set forth
on Schedule 6.1(g) is a true and complete list of all Subsidiaries of the
Borrower as of the date of this Credit Agreement (after giving effect to
the OrthAlliance Acquisition), the ownership thereof and which of such
Subsidiaries are Inactive Subsidiaries.
6.2 COVENANT REGARDING ADDITIONAL CREDIT PARTIES AND COLLATERAL.
At the time any Person becomes a subsidiary guarantor under the Revolving
Senior Credit Agreement, such Person shall also become a Guarantor hereunder by
executing a Joinder Agreement in substantially the same form as Exhibit 6.2. Any
Capital Stock, Intercompany Note or any other assets of a Credit Party pledged
to the Revolver Agent or the Revolver Lenders pursuant to the terms of the
Revolving Senior Credit Agreement or any loan document executed in connection
therewith shall also be pledged to the Administrative Agent pursuant to a Pledge
and Security Agreement and such other collateral documentation as the
Administrative Agent may reasonably require and shall be subject to the terms of
the Intercreditor Agreement.
6.3 INCORPORATION OF ADDITIONAL REPRESENTATIONS, WARRANTIES AND
COVENANTS.
Reference is made to the Revolving Senior Credit Agreement and the
representations and warranties of the Borrower contained in Article V of the
Revolving Senior Credit Agreement (hereinafter referred to as the "Incorporated
Representations and Warranties") and the covenants of the Borrower contained in
Articles VI, VII and VIII (other than Section 8.2(v) thereof) of the Revolving
Senior Credit Agreement (hereinafter referred to as the "Incorporated
Covenants"). Each of the Credit Parties agrees with the Lenders that the
Incorporated Representations and Warranties and the Incorporated Covenants and
all other relevant provisions of the Revolving Senior Credit Agreement related
thereto, including without limitation the defined terms contained in Section 1.1
thereof which are used in the Incorporated Representations and Warranties and
the Incorporated Covenants (hereinafter referred to as the "Additional
Incorporated Terms"), are hereby incorporated by reference into this Credit
Agreement to the same extent and with the same effect as if set forth fully
herein, and shall inure to the benefit of the Lenders, without giving effect to
any waiver, amendment, modification, replacement or termination of the Revolving
Senior Credit Agreement or any term or provision of the Incorporated
Representations and Warranties, the Incorporated Covenants or the Additional
Incorporated Terms occurring subsequent to the Closing Date, except to the
extent otherwise specifically provided in the last paragraph of this Section
6.3.
For purposes of the incorporation of provisions in the Revolving Senior
Credit Agreement pursuant to this Section 6.3, (a) all references in the
Incorporated Representations and Warranties, the Incorporated Covenants and the
Additional Incorporated Terms to (i) the "Administrative Agent" (except with
respect to Section 8.4(iv) of the Incorporated Covenants), the "Lenders," or the
"Required Lenders" shall be deemed to refer to the Administrative Agent, the
Lenders and the Required Lenders hereunder, respectively, (ii) the "Agreement"
(except with respect to Section 8.2(i) of the Incorporated Covenants) shall be
deemed to refer to the "Credit Agreement" hereunder, (iii) "OCA" or "Borrower",
to the extent such reference is to OCA shall be deemed to refer to the
"Borrower" hereunder, as applicable, (iv) the "Obligations" (except with respect
to Section 8.3(i) of the Incorporated Covenants) shall be deemed to refer to the
"Credit Party Obligations" hereunder, (v) the "Closing Date" shall be deemed to
refer to the "Closing Date" hereunder, (vi) the "Commitments" shall be deemed to
refer to the "Commitments" hereunder, (vii) a "Default" or an "Event of Default"
shall be deemed to refer to a "Default" or an "Event of Default" hereunder,
respectively, (viii) the "Loans" (except with respect to Section 8.4(iv) of the
Incorporated Covenants) shall be deemed to refer to the "Term Loans" hereunder,
(ix) the "Maturity Date" shall be deemed to refer to the "Maturity Date" or the
"Extended Maturity Date" (if the Maturity Date has been extended in accordance
with the terms of Section 3.5(a)) hereunder, (x) the "Notes" (except with
respect to Section 8.2(i) of the Incorporated Covenants) shall be deemed to
refer to the "Term Notes" hereunder, (xi) the "Pledge Agreements" (except with
respect to Section 8.3(i) of the Incorporated Covenants) shall be deemed to
refer to the "Pledge and Security Agreements" hereunder, (xii) the "Subsidiary
Guarantors" shall be deemed to refer to the "Guarantors" hereunder, and (xiii)
the "Subsidiary Guaranty" (except with respect to Section 8.2(i) of the
Incorporated Covenants) shall be deemed to refer to the "Guaranty" hereunder,
(b) the reference in Section 8.11(iv) of the Incorporated Covenants to the
"Bridge Credit Documents" shall be deemed to refer to the "Credit Documents" (as
defined in the Revolving Senior Credit Agreement) and (c) references in the
Incorporated Representations and Warranties, the Incorporated Covenants and the
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Additional Incorporated Terms to "Articles", "Sections", "Schedules" or
"Exhibits" shall be to Articles, Sections, Schedules or Exhibits of or to the
Revolving Senior Credit Agreement unless otherwise specifically provided.
In the event a waiver is granted under the Revolving Senior Credit
Agreement or an amendment or modification is executed with respect to the
Revolving Senior Credit Agreement, and such waiver, amendment and/or
modification affects the Incorporated Representations and Warranties, the
Incorporated Covenants or the Additional Incorporated Terms, then such waiver,
amendment or modification shall be effective with respect to the Incorporated
Representations and Warranties, the Incorporated Covenants and the Additional
Incorporated Terms as incorporated by reference into this Credit Agreement only
if consented to in writing by the Required Lenders.
In the event the Revolving Senior Credit Agreement is replaced or
terminated, then the Incorporated Representations and Warranties, the
Incorporated Covenants and the Additional Incorporated Terms (as amended or
modified in accordance with this Section 6.3) shall continue to be the
Incorporated Representations and Warranties, the Incorporated Covenants and the
Additional Incorporated Terms hereunder unless otherwise agreed to by the
Required Lenders or by the Administrative Agent on their behalf.
SECTION 7
EVENTS OF DEFAULT
7.1 EVENT OF DEFAULT.
An event of default shall exist upon the occurrence, and during the
continuation, of any of the following specified events (each an "Event of
Default"):
(a) Payment. The Borrower shall fail to pay (i) any principal of
any Term Loan when due or (ii) any interest on any Term Loan, any fee or
any other Credit Party Obligation when due, and in the case of clause (ii)
only, such failure shall continue unremedied for a period of two (2)
Business Days. Any Guarantor shall fail to pay when due any of its
obligations under the Guaranty. Any default or event of default shall
occur under any Hedging Agreement to which the Borrower and any Lender or
Affiliate of any Lender are parties.
(b) Covenants.
(i) Any Credit Party shall fail to observe, perform or
comply with any condition, covenant or agreement contained in (A)
Section 6.1(f), (B) Sections 6.2(e)(i), 6.3(i) and 6.10 of the
Incorporated Covenants or (C) Article VII or Article VIII of the
Incorporated Covenants.
(ii) Any Credit Party or any of its Subsidiaries shall fail
to observe, perform or comply with any condition, covenant or
agreement contained in this Credit Agreement or any of the other
Credit Documents other than those enumerated in subsections (a) and
(b)(i) above, and such failure shall continue unremedied for any
grace period specifically applicable thereto or, if no such grace
period is applicable, for a period of (A) five (5) days in the case
of the covenants set forth in Sections 6.1, 6.2 (other than
6.2(e)(i)) and 6.9 of the Incorporated Covenants, and (B) thirty
(30) days in all other instances, in each case under clauses (A) and
(B) above after the earlier of (x) the date on which a Responsible
Officer of the Credit Party or such Subsidiary acquires knowledge
thereof and (y) the date on which written notice thereof is
delivered by the Administrative Agent or any Lender to the Borrower.
(c) Representations. Any representation or warranty made or deemed
made by or on behalf of any Credit Party or any of its Subsidiaries in
this Credit Agreement, any of the other Credit Documents or in any
certificate, instrument, report or other document furnished in connection
herewith or therewith or in connection with the transactions contemplated
hereby or thereby shall prove to have been false or misleading in any
material respect as of the time made, deemed made or furnished.
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(d) Defaults Under Other Indebtedness. Any Credit Party or any of
its Subsidiaries shall (i) fail to pay when due (whether by scheduled
maturity, acceleration or otherwise and after giving effect to any
applicable grace period) (A) any principal of or interest on any
Indebtedness (other than the Indebtedness incurred pursuant to this Credit
Agreement) having an aggregate principal amount of at least $250,000 (or,
if such Indebtedness is in a foreign currency, the equivalent of $250,000
in such foreign currency) or (B) any termination or other payment under
any Hedging Agreement covering a notional amount of Indebtedness of at
least $250,000 (or, if such Indebtedness is in a foreign currency, the
equivalent of $250,000 in such foreign currency) or (ii) fail to observe,
perform or comply with any condition, covenant or agreement contained in
any agreement or instrument evidencing or relating to any such
Indebtedness, or any other event shall occur or condition exist in respect
thereof, and the effect of such failure, event or condition is to cause,
or permit the holder or holders of such Indebtedness (or a trustee or
agent on its or their behalf) to cause (with the giving of notice, lapse
of time, or both), such Indebtedness to become due, or to be prepaid,
redeemed, purchased or defeased, prior to its stated maturity.
(e) Voluntary Bankruptcy. Any Credit Party or any of its
Subsidiaries (with assets having a value of $250,000 or more) shall (i)
file a voluntary petition or commence a voluntary case seeking
liquidation, winding-up, reorganization, dissolution, arrangement,
readjustment of debts or any other relief under the Bankruptcy Code or
under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, (ii) consent to the institution of, or fail to
controvert in a timely and appropriate manner, any petition or case of the
type described in subsection (f) below, (iii) apply for or consent to the
appointment of or taking possession by a custodian, trustee, receiver or
similar official for or of itself or all or a substantial part of its
Properties or assets, (iv) fail generally, or admit in writing its
inability, to pay its debts as they become due, (v) make a general
assignment for the benefit of creditors or (vi) take any corporate action
to authorize or approve any of the foregoing.
(f) Involuntary Bankruptcy. Any involuntary petition or case shall
be filed or commenced against any Credit Party or any of its Subsidiaries
(with assets having a value of $250,000 or more) seeking liquidation,
winding-up, reorganization, dissolution, arrangement, readjustment of
debts, the appointment of a custodian, trustee, receiver or similar
official for it or all or a substantial part of its Properties or any
other relief under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency or similar law now or hereafter in effect, and such
petition or case shall continue undismissed and unstayed for a period of
sixty (60) days; or an order, judgment or decree approving or ordering any
of the foregoing shall be entered in any such proceeding.
(g) Judgments. Any one or more money judgments, writs or warrants
of attachment, executions or similar processes involving an aggregate
amount (exclusive of amounts fully bonded or covered by insurance as to
which the surety or insurer, as the case may be, has acknowledged its
liability in writing and that carry a deductible not exceeding $10,000 in
the aggregate) in excess of $1,000,000 shall be entered or filed against
any Credit Party or any of its Subsidiaries or any of their respective
Properties and the same shall not be dismissed, stayed or discharged for a
period of thirty (30) days or in any event later than five days prior to
the date of any proposed sale thereunder.
(h) Credit Documents. (i) Any Credit Document shall fail to be in
full force and effect or any Credit Party shall so assert, (ii) any Pledge
and Security Agreement to which any Credit Party or any of its
Subsidiaries is now or hereafter a party shall for any reason cease to be
in full force and effect or cease to be effective to give the
Administrative Agent a valid and perfected security interest in and Lien
upon the Collateral purported to be covered thereby, subject to no Liens
other than Permitted Liens, in each case unless any such cessation (A)
occurs in accordance with the terms thereof, (B) is due to any act or
failure to act on the part of the Administrative Agent or any Lender, or
(C) affects an immaterial portion of the Collateral purported to be
covered thereby, or any Credit Party or any such Subsidiary shall assert
any of the foregoing, or (iii) any Guarantor or any Person acting on
behalf of any such Guarantor shall deny or disaffirm its obligations under
the Guaranty.
(i) ERISA. Any ERISA Event or any other event or condition shall
occur or exist with respect to any Plan or Multiemployer Plan and, as a
result thereof, together with all other ERISA Events and other events or
conditions then existing, the Credit Parties, their Subsidiaries and the
ERISA Affiliates
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have incurred or would be reasonably likely to incur liability to any one
or more Plans or Multiemployer Plans or to the PBGC (or to any combination
thereof) in excess of $1,000,000.
(j) Limitation on Licenses or Reimbursement Approvals. There shall
occur a Limitation with respect to any one or more Licenses or
Reimbursement Approvals of any Credit Party, any of its Subsidiaries or
any Managed Practice, or any other action shall be taken by any
Governmental Authority or other Person in response to any alleged failure
by such Credit Party, such Subsidiary or such Managed Practice to be in
compliance with applicable Requirements of Law, and such Limitation or
other action, individually or in the aggregate, has or would be reasonably
likely to have a Material Adverse Effect; or there shall occur any
introduction of or change in any Requirement of Law (or in the
interpretation or administration thereof by any Governmental Authority)
governing or affecting any Credit Party, any of its Subsidiaries or any
Managed Practice, and such introduction or change, individually or in the
aggregate, has or would be reasonably likely to have a Material Adverse
Effect.
(k) Termination of Contracts. Any one or more agreements or
contracts to which any Credit Party or any of its Subsidiaries is a party
shall be terminated or shall, for any other reason, fail to be in full
force and effect and enforceable in accordance with its terms, and such
event or condition, together with all other such events or conditions, if
any, has or would be reasonably likely to have a Material Adverse Effect.
(l) Casualty Loss. There shall occur (i) any uninsured damage to,
or loss, theft or destruction of, any Collateral or other Properties of
the Credit Parties and their Subsidiaries having an aggregate fair market
value in excess of $1,000,000 or (ii) any labor dispute, act of God or
other casualty that has or would be reasonably likely to have a Material
Adverse Effect.
(m) Material Adverse Change. There shall occur any Material
Adverse Change or any event, condition or state of facts that could
reasonably be expected to result in a Material Adverse Change.
(n) Change of Control. Any of the following shall occur: (i) any
Person or group of Persons acting in concert as a partnership or other
group shall, as a result of a tender or exchange offer, open market
purchases, privately negotiated purchases or otherwise, have become, after
the date hereof, the "beneficial owner" (within the meaning of such term
under Rule 13d-3 under the Exchange Act) of securities of the Borrower
representing 30% or more of the combined voting power of the then
outstanding securities of the Borrower ordinarily (and apart from rights
accruing under special circumstances) having the right to vote in the
election of directors; or (ii) the Board of Directors of the Borrower
shall cease to consist of a majority of the individuals (A) who
constituted the Board of Directors as of the Closing Date or (B) who shall
have become a member thereof subsequent to the Closing Date after having
been nominated, or otherwise approved in writing, by at least a majority
of individuals who constituted the Board of Directors of the Borrower as
of the Closing Date (or their replacements approved as herein required).
(o) Cross Default. An Event of Default (as defined in the
Revolving Senior Credit Agreement) shall occur.
(p) Post Closing Letter. A breach by the Borrower under the terms
of that certain payoff letter between the Borrower and the Administrative
Agent dated as of the Closing Date.
7.2 ACCELERATION; REMEDIES.
Upon the occurrence and during the continuation of an Event of Default,
the Administrative Agent may or shall, upon the request and direction of the
Required Lenders, take the following actions without prejudice to the rights of
the Administrative Agent or any Lender to enforce its claims against the Credit
Parties, except as otherwise specifically provided for herein:
(a) Termination of Commitments. Declare the Commitments terminated
whereupon the Commitments shall be immediately terminated.
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(b) Acceleration of Term Loans. Declare the unpaid principal of
and any accrued interest in respect of all Term Loans and any and all
other Credit Party Obligations of any and every kind owing by a Credit
Party to any of the Lenders under the Credit Documents to be due whereupon
the same shall be immediately due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by the
Credit Parties.
(c) Enforcement of Rights. To the extent permitted by law and
subject to the terms of the Intercreditor Agreement, enforce (and direct
the Collateral Agent to enforce) any and all rights and interests created
and existing under applicable law and under the Credit Documents,
including, without limitation, all rights and remedies existing under the
Collateral Documents, all rights and remedies against a Guarantor and all
rights of set-off.
Notwithstanding the foregoing, if an Event of Default specified in Section
9.1(f) or (g) of the Revolving Senior Credit Agreement shall occur, then the
Commitments shall automatically terminate and all Term Loans, all accrued
interest in respect thereof, all accrued and unpaid fees and other indebtedness
or obligations owing to the Lenders hereunder shall immediately become due and
payable without the giving of any notice or other action by the Administrative
Agent or the Lenders, which notice or other action is expressly waived by the
Credit Parties.
Notwithstanding the fact that enforcement powers reside primarily with the
Administrative Agent, each Lender has, to the extent permitted by law, a
separate right of payment and shall be considered a separate "creditor" holding
a separate "claim" within the meaning of Section 101(5) of the Bankruptcy Code
or any other insolvency statute.
7.3 ALLOCATION OF PAYMENTS AFTER EVENT OF DEFAULT.
Notwithstanding any other provisions of this Credit Agreement, after the
occurrence and during the continuation of an Event of Default, all amounts
collected or received by the Administrative Agent or any Lender on account of
amounts outstanding under any of the Credit Documents shall be paid over or
delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket costs and
expenses (including without limitation reasonable Attorney Costs) of the
Administrative Agent or any of the Lenders in connection with enforcing
the rights of the Administrative Agent and the Lenders under the Credit
Documents, pro rata as set forth below;
SECOND, to payment of any fees owed to the Administrative Agent or
any Lender, pro rata as set forth below;
THIRD, to the payment of all accrued interest payable to the Lenders
hereunder, pro rata as set forth below;
FOURTH, to the payment of the outstanding principal amount of the
Term Loans and to any principal amounts outstanding under Hedging
Agreements between a Credit Party and a Lender or Affiliate of a Lender,
pro rata as set forth below;
FIFTH, to all other Credit Party Obligations which shall have become
due and payable under the Credit Documents and not repaid pursuant to
clauses "FIRST" through "FOURTH" above; and
SIXTH, the payment of the surplus, if any, to whomever may be
lawfully entitled to receive such surplus.
In carrying out the foregoing, (a) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; and (b) each of the Lenders shall receive an amount equal
to its pro rata share (based on the proportion that the then outstanding Term
Loans held by such Lender bears to the aggregate then outstanding Term Loans,
or, in the case of clause "FOURTH" above, the proportion that the then
outstanding Term Loans and obligations under Hedging Agreements held by such
Lender bears to the aggregate then outstanding Term Loans and obligations under
Hedging Agreements) of amounts available to be applied.
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SECTION 8
AGENCY PROVISIONS
8.1 APPOINTMENT.
Each Lender hereby irrevocably appoints, designates and authorizes the
Administrative Agent to take such action on its behalf under the provisions of
this Credit Agreement and each other Credit Document and to exercise such powers
and perform such duties as are expressly delegated to it by the terms of this
Credit Agreement or any other Credit Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere herein or in any other Credit Document, the Administrative
Agent shall not have any duties or responsibilities, except those expressly set
forth herein, nor shall the Administrative Agent have or be deemed to have any
fiduciary or trustee relationship with any Lender or participant, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Credit Agreement or any other Credit Document or otherwise
exist against the Administrative Agent. Without limiting the generality of the
foregoing sentence, the use of the term "agent" herein and in the other Credit
Documents with reference to the Administrative Agent is not intended to connote
any fiduciary or other implied (or express) obligations arising under agency
doctrine of any applicable law. Instead, such term is used merely as a matter of
market custom, and is intended to create or reflect only an administrative
relationship between independent contracting parties.
8.2 DELEGATION OF DUTIES.
The Administrative Agent may execute any of its duties under this Credit
Agreement or any other Credit Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel and other
consultants or experts concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the negligence or misconduct
of any agent or attorney-in-fact that it selects with reasonable care.
8.3 EXCULPATORY PROVISIONS.
No Agent-Related Person shall (a) be liable for any action taken or
omitted to be taken by any of them under or in connection with this Credit
Agreement or any other Credit Document or the transactions contemplated hereby
or thereby (except for its own gross negligence or willful misconduct in
connection with its duties expressly set forth herein and therein), or (b) be
responsible in any manner to any Lender or participant for any recital,
statement, representation or warranty made by any Credit Party or any officer
thereof, contained herein or in any other Credit Document, or in any
certificate, report, statement or other document referred to or provided for in,
or received by the Administrative Agent under or in connection with, this Credit
Agreement or any other Credit Document, or the validity, effectiveness,
genuineness, enforceability or sufficiency of this Credit Agreement or any other
Credit Document, or for any failure of any Credit Party or any other party to
any Credit Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Lender or participant
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Credit Agreement or any other
Credit Document, or to inspect the properties, books or records of any Credit
Party or any Affiliate thereof.
8.4 RELIANCE ON COMMUNICATIONS.
(a) The Administrative Agent shall be entitled to rely, and shall
be fully protected in relying, upon any writing, communication, signature,
resolution, representation, notice, consent, certificate, affidavit,
letter, telegram, facsimile, telex or telephone message, statement or
other document or conversation believed by it to be genuine and correct
and to have been signed, sent or made by the proper Person or Persons, and
upon advice and statements of legal counsel (including counsel to any
Credit Party), independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent may deem and treat each
Lender as the owner of its interests hereunder for all purposes unless a
written notice of assignment, negotiation or transfer thereof shall have
been delivered to the Administrative
33
Agent in accordance with Section 9.3(b). The Administrative Agent shall be
fully justified in failing or refusing to take any action under any Credit
Document unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate and, if it so requests, it shall
first be indemnified to its satisfaction by the Lenders against any and
all liability and expense which may be incurred by it by reason of taking
or continuing to take any such action. The Administrative Agent shall in
all cases be fully protected in acting, or in refraining from acting,
under this Credit Agreement or any other Credit Document in accordance
with a request or consent of the Required Lenders or all the Lenders, if
required hereunder, and such request and any action taken or failure to
act pursuant thereto shall be binding upon all the Lenders and
participants, and their respective successors and assigns. Where this
Credit Agreement expressly permits or prohibits an action unless the
Required Lenders otherwise determine, the Administrative Agent shall, and
in all other instances, the Administrative Agent may, but shall not be
required to, initiate any solicitation for the consent or a vote of the
Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 5.1, each Lender that has signed this Credit
Agreement shall be deemed to have consented to, approved or accepted or to
be satisfied with, each document or other matter either sent by the
Administrative Agent to such Lender for consent, approval, acceptance or
satisfaction, or required thereunder to be consented to or approved by or
acceptable or satisfactory to a Lender.
8.5 NOTICE OF DEFAULT.
The Administrative Agent shall not be deemed to have knowledge or notice
of the occurrence of any Default or Event of Default, except with respect to
defaults in the payment of principal, interest and fees required to be paid to
the Administrative Agent for the account of the Lenders, unless the
Administrative Agent shall have received written notice from a Lender or a
Credit Party referring to this Credit Agreement, describing such Default or
Event of Default and stating that such notice is a "notice of default." The
Administrative Agent will notify the Lenders of its receipt of any such notice.
The Administrative Agent shall take such action with respect to such Default or
Event of Default as may be reasonably directed by the Required Lenders in
accordance with Section 7.2; provided, however, that unless and until the
Administrative Agent has received any such direction, the Administrative Agent
may (but shall not be obligated to) take such action, or refrain from taking
such action, with respect to such Default or Event of Default as it shall deem
advisable or in the best interest of the Lenders.
8.6 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS.
Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by the Administrative Agent
hereinafter taken, including any consent to and acceptance of any assignment or
review of the affairs of any Credit Party or any Affiliate thereof, shall be
deemed to constitute any representation or warranty by any Agent-Related Person
to any Lender as to any matter, including whether Agent-Related Persons have
disclosed material information in their possession. Each Lender represents to
the Administrative Agent that it has, independently and without reliance upon
any Agent-Related Person or any other Lender and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, Property, financial and
other condition and creditworthiness of the Credit Parties and their respective
Affiliates, and all applicable bank or other regulatory laws relating to the
transactions contemplated hereby, and made its own decision to enter into this
Credit Agreement and to extend credit to the Borrower hereunder. Each Lender
also represents that it will, independently and without reliance upon any
Agent-Related Person or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Credit Agreement and the other Credit Documents, and to make such
investigations as it deems necessary to inform itself as to the business,
prospects, operations, Property, financial and other condition and
creditworthiness of the Credit Parties. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent herein, the Administrative Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of any of the Credit Parties or any of their
respective Affiliates which may come into the possession of any Agent-Related
Person.
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8.7 INDEMNIFICATION.
Whether or not the transactions contemplated hereby are consummated, the
Lenders shall indemnify upon demand each Agent-Related Person (to the extent not
reimbursed by or on behalf of any Credit Party and without limiting the
obligation of any Credit Party to do so), pro rata, and hold harmless each
Agent-Related Person from and against any and all Indemnified Liabilities
incurred by it; provided, however, that no Lender shall be liable for the
payment to any Agent-Related Person of any portion of such Indemnified
Liabilities resulting from such Agent-Related Person's gross negligence or
willful misconduct; it being understood that no action taken in accordance with
the directions of the Required Lenders shall be deemed to constitute gross
negligence or willful misconduct for purposes of this Section 8.7. Without
limitation of the foregoing, each Lender shall reimburse the Administrative
Agent upon demand for its ratable share of any costs or out-of-pocket expenses
(including Attorney Costs) incurred by the Administrative Agent in connection
with the preparation, execution, delivery, administration, modification,
amendment or enforcement (whether through negotiations, legal proceedings or
otherwise) of, or legal advice in respect of rights or responsibilities under,
this Credit Agreement, any other Credit Document, or any document contemplated
by or referred to herein, to the extent that the Administrative Agent is not
reimbursed for such expenses by or on behalf of the Credit Parties. The
undertaking in this Section 8.7 shall survive termination of the Commitments,
the payment of all Credit Party Obligations hereunder and the resignation or
replacement of the Administrative Agent.
8.8 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY.
Bank of America and its Affiliates may make loans to, issue letters of
credit for the account of, accept deposits from, acquire equity interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with each of the Credit Parties and their respective
Affiliates as though Bank of America were not the Administrative Agent hereunder
and without notice to or consent of the Lenders. The Lenders acknowledge that,
pursuant to such activities, Bank of America or its Affiliates may receive
information regarding any Credit Party or its Affiliates (including information
that may be subject to confidentiality obligations in favor of such Credit Party
or such Affiliate) and that the Administrative Agent shall be under no
obligation to provide such information to them. With respect to its Term Loans,
Bank of America shall have the same rights and powers under this Credit
Agreement as any other Lender and may exercise such rights and powers as though
it were not the Administrative Agent, and the terms "Lender" and "Lenders"
include Bank of America in its individual capacity.
8.9 SUCCESSOR AGENT.
The Administrative Agent may resign as Administrative Agent upon 30 days'
notice to the Lenders. If the Administrative Agent resigns under this Credit
Agreement, the Required Lenders shall appoint a successor administrative agent
for the Lenders (such appointment, absent the existence of an Event of Default,
to be subject to the consent of the Borrower, which consent of the Borrower
shall not be unreasonably withheld or delayed). If no successor administrative
agent is appointed prior to the effective date of the resignation of the
Administrative Agent, the Administrative Agent may appoint, after consulting
with the Lenders and the Borrower, a successor administrative agent. Upon the
acceptance of its appointment as successor administrative agent hereunder, such
successor administrative agent shall succeed to all the rights, powers and
duties of the retiring Administrative Agent and the term "Administrative Agent"
shall mean such successor administrative agent and the retiring Administrative
Agent's appointment, powers and duties as Administrative Agent shall be
terminated. After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this Section 8 and Sections 9.5 and 9.10
shall continue to inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent under this Credit Agreement. If no
successor administrative agent has accepted appointment as Administrative Agent
by the date which is 30 days following a retiring Administrative Agent's notice
of resignation, the retiring Administrative Agent's resignation shall
nevertheless thereupon become effective and the Lenders shall perform all of the
duties of the Administrative Agent hereunder until such time, if any, as the
Required Lenders appoint a successor agent as provided for above.
8.10 INTERCREDITOR AGREEMENT.
Each of the Lenders hereby acknowledges that it has received and reviewed
the Intercreditor Agreement and hereby (a) authorizes the Administrative Agent
to execute and deliver the Intercreditor Agreement on its behalf and (b)
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consents to the appointment of First Union National Bank as Collateral Agent, on
behalf of the Benefited Parties, pursuant to the terms of the Intercreditor
Agreement.
SECTION 9
MISCELLANEOUS
9.1 NOTICES.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered by hand, (b) when transmitted via telecopy (or other facsimile device)
to the number set forth on Schedule 9.1, (c) on the Business Day following the
day on which the same has been delivered prepaid (or subject to an invoice
arrangement) to a reputable national overnight air courier service, or (d) on
the third Business Day following the day on which the same is sent by certified
or registered mail, postage prepaid, in each case to the respective parties at
the address or telecopy numbers set forth on Schedule 9.1, or at such other
address as such party may specify by written notice to the other parties hereto.
9.2 RIGHT OF SET-OFF.
In addition to any rights now or hereafter granted under applicable law or
otherwise, and not by way of limitation of any such rights, upon the occurrence
of an Event of Default and the commencement of remedies described in Section
7.2, each Lender is authorized at any time and from time to time, without
presentment, demand, protest or other notice of any kind (all of which rights
being hereby expressly waived), to set-off and to appropriate and apply any and
all deposits (general or special) and any other indebtedness at any time held or
owing by such Lender (including, without limitation, branches, agencies or
Affiliates of such Lender wherever located) to or for the credit or the account
of any Credit Party against obligations and liabilities of the Credit Parties to
the Lenders hereunder, under the Term Notes, the other Credit Documents or
otherwise, irrespective of whether the Administrative Agent or the Lenders shall
have made any demand hereunder and although such obligations, liabilities or
claims, or any of them, may be contingent or unmatured, and any such set-off
shall be deemed to have been made immediately upon the occurrence of an Event of
Default even though such charge is made or entered on the books of such Lender
subsequent thereto. The Credit Parties hereby agree that any Person purchasing a
participation in the Term Loans and Commitments hereunder pursuant to Sections
3.8 or 9.3(e) may exercise all rights of set-off with respect to its
participation interest as fully as if such Person were a Lender hereunder.
9.3 BENEFIT OF AGREEMENT.
(a) Generally. This Credit Agreement shall be binding upon and
inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto; provided that none of the Credit
Parties may assign and transfer any of its interests (except as permitted
by Section 8.1 of the Incorporated Covenants) without the prior written
consent of the Lenders; and provided further that the rights of each
Lender to transfer, assign or grant participations in its rights and/or
obligations hereunder shall be limited as set forth below in this Section
9.3.
(b) Assignments. Each Lender may assign to one or more Eligible
Assignees all or a portion of its rights and obligations under this Credit
Agreement (including, without limitation, all or a portion of its Term
Loans, its Term Notes and its Commitment); provided, however, that:
(i) each such assignment shall be to an Eligible Assignee;
(ii) except (A) in the case of an assignment to another
Lender, (B) in the case of an assignment of all of a Lender's rights
and obligations under this Credit Agreement, or (C) with the consent
of the Administrative Agent and the Borrower, any such partial
assignment shall be in an amount at least equal to $1,000,000 (or,
if less, the remaining amount of the Commitment of such assigning
Lender) or an integral multiple of $500,000 in excess thereof;
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(iii) each such assignment by a Lender shall be of a constant,
and not varying, percentage of all of its rights and obligations
under this Credit Agreement and the Term Notes; and
(iv) the parties to such assignment shall execute and deliver
to the Administrative Agent for its acceptance an assignment
agreement in substantially the form of Exhibit 9.3(b), together with
a processing fee from the assignor of $3,500.
Upon execution, delivery, and acceptance of such assignment agreement, the
assignee thereunder shall be a party hereto and, to the extent of such
assignment, have the obligations, rights, and benefits of a Lender
hereunder and the assigning Lender shall, to the extent of such
assignment, relinquish its rights and be released from its obligations
under this Credit Agreement. Upon the consummation of any assignment
pursuant to this Section 9.3(b), the assigning Lender, the Administrative
Agent and the Borrower shall make appropriate arrangements so that, if
required, new Term Notes are issued to the assignee. If the assignee is
not incorporated under the laws of the United States of America or a state
thereof, it shall deliver to the Borrower and the Administrative Agent
certification as to exemption from deduction or withholding of taxes in
accordance with Section 3.13.
By executing and delivering an assignment agreement in accordance with
this Section 9.3(b), the assigning Lender thereunder and the assignee
thereunder shall be deemed to confirm to and agree with each other and the
other parties hereto as follows: (A) such assigning Lender warrants that
it is the legal and beneficial owner of the interest being assigned
thereby free and clear of any adverse claim and the assignee warrants that
it is an Eligible Assignee; (B) except as set forth in clause (A) above,
such 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, any
of the other Credit Documents or any other instrument or document
furnished pursuant hereto or thereto, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Credit
Agreement, any of the other Credit Documents or any other instrument or
document furnished pursuant hereto or thereto or the financial condition
of any Credit Party or the performance or observance by any Credit Party
of any of its obligations under this Credit Agreement, any of the other
Credit Documents or any other instrument or document furnished pursuant
hereto or thereto; (C) such assigning Lender and such assignee each
represents and warrants that it is legally authorized to enter into such
assignment agreement; (D) such assignee confirms that it has received a
copy of this Credit Agreement, the other Credit Documents and such other
documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such assignment agreement; (E)
such assignee will independently and without reliance upon the
Administrative 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 and the other Credit Documents; (F)
such assignee appoints and authorizes the Administrative Agent to take
such action on its behalf and to exercise such powers under this Credit
Agreement or any other Credit Document as are delegated to the
Administrative Agent by the terms hereof or thereof, together with such
powers as are reasonably incidental thereto; and (G) such assignee agrees
that it will perform in accordance with their terms all the obligations
which by the terms of this Credit Agreement and the other Credit Documents
are required to be performed by it as a Lender.
(c) Register. The Administrative Agent shall maintain a copy of
each Assignment Agreement delivered to and accepted by it and a register
for the recordation of the names and addresses of the Lenders and the
Commitment of, and principal amount of the Term Loans owing to, each
Lender from time to time (the "Register"). The entries in the Register
shall be conclusive and binding for all purposes, absent manifest error,
and the Borrower, the Administrative 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 shall be available for
inspection by the Borrower or any Lender at any reasonable time and from
time to time upon reasonable prior notice.
(d) Acceptance. Upon its receipt of an assignment agreement
executed by the parties thereto, together with any Note subject to such
assignment and payment of the processing fee, the Administrative Agent
shall, if such assignment agreement has been completed and is in
substantially the form of
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Exhibit 9.3(b), (i) accept such assignment agreement, (ii) record the
information contained therein in the Register and (iii) give prompt notice
thereof to the parties thereto.
(e) Participations. Each Lender may sell participations to one or
more Persons in all or a portion of its rights, obligations or rights and
obligations under this Credit Agreement (including all or a portion of its
Commitment and its Term Loans); provided, however, that (i) such Lender's
obligations under this Credit Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iii) each participant shall be entitled
to the benefit of the yield protection provisions contained in Sections
3.9 through 3.14, inclusive (but not for a greater amount than the Lender
would be entitled to), and of the right of set-off contained in Section
9.2, (iv) the Borrower 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 retain the sole right to
enforce the obligations of the Borrower relating to its Term Loans and its
Term Notes and to approve any amendment, modification, or waiver of any
provision of this Credit Agreement (other than amendments, modifications,
or waivers decreasing the amount of principal of or the rate at which
interest is payable on such Term Loans or Term Notes, extending any
scheduled principal payment date or date fixed for the payment of interest
on such Term Loans or Term Notes, extending its Commitment or releasing
the Borrower or all or substantially all of the Guarantors from its or
their respective obligations under the Credit Documents).
(f) Unrestricted Assignments. Notwithstanding any other provision
set forth in this Credit Agreement, any Lender may at any time assign and
pledge all or any portion of its Term Loans and its Term Notes to any
Federal Reserve Bank as collateral security pursuant to Regulation A and
any Operating Circular issued by such Federal Reserve Bank. No such
assignment shall release the assigning Lender from its obligations
hereunder.
(g) Information. Any Lender may furnish any information concerning
the Credit Parties or any of their Subsidiaries in the possession of such
Lender from time to time to assignees and participants (including
prospective assignees and participants), subject, however, to the
provisions of Section 9.14.
9.4 NO WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of the Administrative Agent or any Lender
in exercising any right, power or privilege hereunder or under any other Credit
Document and no course of dealing between the Borrower or any other Credit Party
and the Administrative Agent or any Lender shall operate as a waiver thereof;
nor shall any single or partial exercise of any right, power or privilege
hereunder or under any other Credit Document preclude any other or further
exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder. The rights and remedies provided herein are cumulative
and not exclusive of any rights or remedies which the Administrative Agent or
any Lender would otherwise have. No notice to or demand on any Credit Party in
any case shall entitle any Credit Party to any other or further notice or demand
in similar or other circumstances or constitute a waiver of the rights of the
Administrative Agent or the Lenders to any other or further action in any
circumstances without notice or demand.
9.5 PAYMENT OF EXPENSES; INDEMNIFICATION.
The Credit Parties agree to: (a) pay all reasonable out-of-pocket costs
and expenses of (i) the Agent-Related Persons in connection with (A) the
negotiation, preparation, execution and delivery, syndication 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 ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC, special counsel to the
Administrative Agent), subject to any limitation with respect to fees and
expenses in connection with the closing of this Credit Agreement set forth in
that certain Commitment Letter, dated October 24, 2001, among the Borrower, Bank
of America and BAS, 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 the Credit Documents, and (ii)
the Agent-Related Persons and the Lenders in connection with (A) enforcement of
the Credit Documents and the documents and instruments referred to herein and
therein, including, without limitation, in connection with any such enforcement,
the reasonable Attorneys' Costs of the Administrative Agent and each of the
Lenders and (B) any bankruptcy or insolvency proceeding of any member of the
38
consolidated group, and (b) indemnify the Agent-Related Persons and each Lender,
its officers, directors, employees, representatives, counsel and agents from and
hold each of them harmless against any and all losses, liabilities, claims,
damages or expenses incurred by any of them as a result of, or arising out of,
or in any way related to, or by reason of, any investigation, litigation or
other proceeding (whether or not such Agent-Related Person or any Lender is a
party thereto) related to the entering into and/or performance of any Credit
Document or the use of proceeds of any Term Loans hereunder or the consummation
of any other transactions contemplated in any Credit Document, including,
without limitation, reasonable Attorneys' Costs incurred in connection with any
such investigation, litigation or other proceeding (but excluding any such
losses, liabilities, claims, damages or expenses to the extent incurred by
reason of gross negligence or willful misconduct on the part of the Person to be
indemnified) (all of the foregoing, collectively, the "Indemnified
Liabilities"). The agreements in this Section 9.5 shall survive the termination
of the Commitments and the repayment of the Credit Party Obligations.
9.6 AMENDMENTS, WAIVERS AND CONSENTS.
Neither this Credit Agreement nor any other Credit Document nor any of the
terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is in
writing and signed by the Required Lenders and the then Credit Parties; provided
that no such amendment, change, waiver, discharge or termination shall, without
the consent of each Lender affected thereby:
(a) extend the Maturity Date or the Extended Maturity Date (it
being understood that an extension of the Maturity Date in accordance with
the terms of Section 3.5(a) shall not require the consent of any Lender);
(b) reduce the rate or extend the time of payment of interest
(other than as a result of waiving the applicability of any post-default
increase in interest rates) on the Term Loans or fees hereunder;
(c) reduce or waive the principal amount of any Term Loan or
extend the time of payment thereof;
(d) increase or extend the Commitment of a Lender (it being
understood and agreed that a waiver of any Default or Event of Default or
a waiver of any mandatory reduction in the Commitments shall not
constitute a change in the terms of any Commitment of any Lender);
(e) release the Borrower from its obligations or consent to the
assignment or transfer by the Borrower of any of its rights and
obligations under (or in respect of) the Credit Documents, release all or
substantially all of the other Guarantors from their respective
obligations under the Credit Documents or release all or substantially all
of the Collateral;
(f) amend, modify or waive any provision of this Section 9.6 or
Section 3.7, 3.8, 7.1(a), 9.2, 9.3 or 9.5; or
(g) reduce any percentage specified in, or otherwise modify, the
definition of Required Lenders.
Notwithstanding the above, no provision of Sections 3.4 or 8 may be amended or
modified without the consent of the Administrative Agent.
Each Lender understands and agrees that if such Lender is a Defaulting Lender
then, notwithstanding the provisions of this Section 9.6, it shall not be
entitled to vote on any matter requiring the consent of the Required Lenders or
to object to any matter requiring the consent of all the Lenders; provided,
however, that all other benefits and obligations under the Credit Documents
shall apply to such Defaulting Lender.
Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote as
such Lender sees fit on any reorganization plan that affects the Term Loans, and
each Lender acknowledges that the provisions of Section 1126(c) of the
Bankruptcy Code supersede the unanimous consent provisions set forth herein and
(y) the Required Lenders may consent to allow a Credit Party to use cash
collateral in the context of a bankruptcy or insolvency proceeding.
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9.7 COUNTERPARTS/TELECOPY.
This Credit Agreement may be executed in any number of counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. Delivery of an executed
counterpart by telecopy shall be as effective as an original and shall
constitute a representation that an original will be delivered.
9.8 HEADINGS.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Credit Agreement.
9.9 SURVIVAL OF INDEMNIFICATION.
All indemnities set forth herein shall survive the execution and delivery
of this Credit Agreement, the making of the Term Loans and the repayment of the
Term Loans and other Credit Party Obligations and the termination of the
Commitments hereunder.
9.10 GOVERNING LAW; VENUE; JURISDICTION.
(a) THIS CREDIT AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE
GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK (INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE NEW
YORK GENERAL OBLIGATIONS LAW, BUT EXCLUDING ALL OTHER CHOICE OF LAW AND
CONFLICTS OF LAW RULES). Any legal action or proceeding with respect to
this Credit Agreement or any other Credit Document may be brought in the
courts of the State of North Carolina or of the United States for the
Western District of North Carolina, and, by execution and delivery of this
Credit Agreement, each Credit Party hereby irrevocably accepts for itself
and in respect of its Property, generally and unconditionally, the
jurisdiction of such courts. Each Credit Party irrevocably consents to the
service of process in any action or proceeding with respect to this Credit
Agreement or any other Credit Document by the mailing of copies thereof by
registered or certified mail, postage prepaid, to it at the address for
notices pursuant to Section 9.1, such service to become effective ten days
after such mailing. Nothing herein shall affect the right of a Lender to
serve process in any other manner permitted by law or to commence legal
proceedings or otherwise proceed against a Credit Party in any other
jurisdiction. Each Credit Party agrees that a final judgment in any action
or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by
law; provided that nothing in this Section 9.10(a) is intended to impair a
Credit Party's right under applicable law to appeal or seek a stay of any
judgment.
(b) Each Credit Party hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with this
Credit Agreement or any other Credit Document in the courts referred to in
subsection (a) above and hereby further irrevocably waives and agrees not
to plead or claim in any such court that any such action or proceeding
brought in any such court has been brought in an inconvenient forum.
9.11 WAIVER OF JURY TRIAL; WAIVER OF CONSEQUENTIAL DAMAGES.
EACH OF THE PARTIES TO THIS CREDIT AGREEMENT HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF
OR RELATING TO THIS CREDIT AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY. Each Credit Party agrees not to
assert any claim against the Administrative Agent, any Lender, any of their
Affiliates, or any of their respective directors, officers, employees, attorneys
or agents, on any theory of liability, for special, indirect, consequential or
punitive damages arising out of or otherwise relating to any of the transactions
contemplated herein and in the other Credit Documents.
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9.12 SEVERABILITY.
If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
9.13 FURTHER ASSURANCES.
The Credit Parties agree, upon the request of the Administrative Agent, to
promptly take such actions, as reasonably requested, as is necessary to carry
out the intent of this Credit Agreement and the other Credit Documents,
including without limitation such actions as are necessary or desirable in
connection with the creation, perfection and maintenance of the security
interests of the Lenders in the Collateral.
9.14 CONFIDENTIALITY.
Each Lender agrees that it will use reasonable efforts to keep
confidential any non-public information from time to time supplied to it under
any Credit Document; provided, however, that nothing herein shall prevent the
disclosure of any such information to (a) the extent a Lender in good faith
believes such disclosure is required by Requirement of Law or judicial process,
(b) counsel for a Lender or to its accountants, (c) bank examiners or auditors
or comparable Persons, (d) any Affiliate of a Lender, (e) any other Lender, or
any assignee, transferee or participant, or any potential assignee, transferee
or participant, of all or any portion of any Lender's rights under this Credit
Agreement who is notified of the confidential nature of such information or (f)
any other Person in connection with (i) any litigation to which any one or more
of the Lenders is a party if required by a court of law of competent
jurisdiction or (ii) any proceeding to enforce such Lender's rights hereunder,
under any other Credit Document or under any Hedging Agreement. No Lender shall
have any obligation under this Section 9.14 to the extent any such information
becomes available on a non-confidential basis from a source other than a Credit
Party or that any information becomes publicly available other than by a breach
of this Section 9.14 by any Lender or representative thereof.
9.15 ENTIRETY.
This Credit Agreement together with the other Credit Documents and the Fee
Letter represent the entire agreement of the parties hereto and thereto, and
supersede all prior agreements and understandings, oral or written, if any,
including any commitment letters or correspondence relating to the Credit
Documents or the transactions contemplated herein and therein.
9.16 BINDING EFFECT; CONTINUING AGREEMENT.
(a) This Credit Agreement shall become effective at such time when
all of the conditions set forth in Section 5.1 have been satisfied or
waived by the Lenders and it shall have been executed by the Borrower, the
Guarantors and the Administrative Agent, and the Administrative Agent
shall have received copies hereof (telefaxed or otherwise) which, when
taken together, bear the signatures of each Lender, and thereafter this
Credit Agreement shall be binding upon and inure to the benefit of the
Borrower, the Guarantors, the Administrative Agent and each Lender and
their respective successors and assigns.
(b) This Credit Agreement shall be a continuing agreement and
shall remain in full force and effect until all Term Loans, interest, fees
and other Credit Party Obligations have been paid in full and all
Commitments have been terminated. Upon termination, the Credit Parties
shall have no further obligations (other than the indemnification
provisions and other provisions that by their terms survive) under the
Credit Documents; provided that should any payment, in whole or in part,
of the Credit Party Obligations be rescinded or otherwise required to be
restored or returned by the Administrative Agent or any Lender, whether as
a result of any proceedings in bankruptcy or reorganization or otherwise,
then the Credit Documents shall automatically be reinstated and all
amounts required to be restored or returned and all costs and expenses
incurred by the Administrative Agent or any Lender in connection therewith
shall be deemed included as part of the Credit Party Obligations.
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9.17 CONFLICT WITH INTERCREDITOR AGREEMENT.
In case of a conflict between any provision of this Credit Agreement and
any provision of the Intercreditor Agreement, the provisions of the
Intercreditor Agreement shall control. No such conflict shall be deemed to exist
merely because this Credit Agreement imposes greater obligations on the Credit
Parties than the Intercreditor Agreement.
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Each of the parties hereto has caused a counterpart of this Credit
Agreement to be duly executed and delivered as of the date first above written.
BORROWER:
ORTHODONTIC CENTERS OF AMERICA, INC.,
a Delaware corporation
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
Title: Chairman of the Board, President and Chief
Executive Officer
GUARANTORS:
ORTHODONTIC CENTERS OF ALABAMA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF ARIZONA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF ARKANSAS, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF CALIFORNIA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF COLORADO, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF CONNECTICUT, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF FLORIDA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF GEORGIA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF HAWAII, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF IDAHO, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF ILLINOIS, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF INDIANA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF KANSAS, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF KENTUCKY, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF LOUISIANA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF MAINE, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF MARYLAND, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF MASSACHUSETTS, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF MICHIGAN, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF MINNESOTA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF MISSISSIPPI, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF MISSOURI, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF NEVADA, INC.,
a Nevada corporation
ORTHODONTIC CENTERS OF NEW HAMPSHIRE, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF NEW JERSEY, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF NEW MEXICO, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF NEW YORK, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF NORTH CAROLINA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF NORTH DAKOTA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF OHIO, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF OKLAHOMA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF OREGON, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF PENNSYLVANIA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF PUERTO RICO, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF RHODE ISLAND, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF SOUTH CAROLINA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF TENNESSEE, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF TEXAS, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF UTAH, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF VIRGINIA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF WASHINGTON, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF WASHINGTON D.C., INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF WEST VIRGINIA, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF WISCONSIN, INC.,
a Delaware corporation
ORTHODONTIC CENTERS OF WYOMING, INC.,
a Delaware corporation
ORTHALLIANCE, INC.,
a Delaware corporation
ORTHALLIANCE FINANCE, INC.,
a Delaware corporation
ORTHALLIANCE PROPERTIES, INC.,
a California corporation
ORTHALLIANCE SERVICES, INC.,
a California corporation
ORTHALLIANCE HOLDINGS, INC.,
a Texas corporation
ORTHALLIANCE NEW IMAGE, INC.,
a Delaware corporation
PEDOALLIANCE, INC.,
a Delaware corporation
PEDOALLIANCE PROPERTIES, INC.,
a California corporation
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
Title: President of each of the foregoing Guarantors
LENDERS:
BANK OF AMERICA, N.A.,
individually in its capacity as a Lender and in
its capacity as Administrative Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Principal
BANK ONE, NA
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President