EXHIBIT 10.12
AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of
August 31, 2001
among
PEGASUS SOLUTIONS, INC.,
formerly known as
PEGASUS SYSTEMS, INC.,
as Borrower
The Lenders Party Hereto,
and
THE CHASE MANHATTAN BANK,
successor to
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION,
as Administrative Agent
and
THE CHASE MANHATTAN BANK
as Issuing Bank
CHASE SECURITIES INC.,
as Lead Arranger and Book Manager
TABLE OF CONTENTS
Page
ARTICLE I Definitions ........................................1
SECTION 1.01. Defined Terms...............................1
SECTION 1.02. Terms Generally............................14
SECTION 1.03. Accounting Terms; GAAP.....................14
ARTICLE II The Credits .......................................15
SECTION 2.01. Commitments................................15
SECTION 2.02. Loans and Borrowings.......................15
SECTION 2.03. Requests for Borrowings....................15
SECTION 2.04. Funding of Borrowings......................16
SECTION 2.05. Interest Elections.........................17
SECTION 2.06. Termination and Reduction of Commitments...18
SECTION 2.07. Repayment of Loans; Evidence of Debt.......18
SECTION 2.08. Prepayment of Loans........................19
SECTION 2.09. Fees.......................................19
SECTION 2.10. Interest...................................20
SECTION 2.11. Taxes......................................21
SECTION 2.12. Payments Generally; Pro Rata Treatment;
Sharing of Set-offs........................21
SECTION 2.13. Mitigation Obligations; Replacement of
Lenders....................................23
SECTION 2.14. Letters of Credit..........................24
ARTICLE III Yield Protection and Illegality ...................27
SECTION 3.01. Increased Costs............................27
SECTION 3.02. Alternate Rate of Interest.................28
SECTION 3.03. Illegality.................................29
SECTION 3.04. Treatment of Affected Borrowings...........29
SECTION 3.05. Break Funding Payments.....................30
ARTICLE IV Security ..........................................30
SECTION 4.01. Collateral.................................30
ARTICLE V Representations and Warranties ....................31
SECTION 5.01. Organization; Powers.......................31
SECTION 5.02. Authorization; Enforceability..............31
SECTION 5.03. Governmental Approvals; No Conflicts.......31
SECTION 5.04. Financial Condition; No Material Adverse
Change.....................................31
SECTION 5.05. Properties.................................32
SECTION 5.06. Litigation and Environmental Matters.......32
SECTION 5.07. Compliance with Laws and Agreements........33
SECTION 5.08. Investment and Holding Company Status......33
SECTION 5.09. Taxes......................................33
SECTION 5.10. ERISA......................................33
SECTION 5.11. Disclosure.................................33
SECTION 5.12. Year 2000..................................33
SECTION 5.13. Indebtedness...............................34
SECTION 5.14. Subsidiaries...............................34
SECTION 5.15. Inventory..................................34
SECTION 5.16. Patents, Trademarks and Copyrights.........34
SECTION 5.17. Margin Securities..........................35
SECTION 5.18. Labor Matters..............................35
SECTION 5.19. Solvency...................................35
SECTION 5.20. Burdensome Agreements......................35
ARTICLE VI Conditions ........................................35
SECTION 6.01. Effective Date.............................35
SECTION 6.02. Each Credit Event..........................38
ARTICLE VII Affirmative Covenants .............................38
SECTION 7.01. Financial Statements and Other Information.38
SECTION 7.02. Notices of Material Events.................39
SECTION 7.03. Existence; Conduct of Business.............40
SECTION 7.04. Payment of Obligations.....................40
SECTION 7.05. Maintenance of Properties..................40
SECTION 7.06. Books and Records; Inspection Rights.......40
SECTION 7.07. Insurance..................................40
SECTION 7.08. Compliance with Laws.......................41
SECTION 7.09. Use of Proceeds............................41
SECTION 7.10. Compliance with Agreements.................41
SECTION 7.11. Additional Subsidiaries....................41
SECTION 7.12. Real Property..............................41
SECTION 7.13. Further Assurances.........................41
ARTICLE VIIINegative Covenants ................................42
SECTION 8.01. Indebtedness...............................42
SECTION 8.02. Liens......................................42
SECTION 8.03. Fundamental Changes........................43
SECTION 8.04. Investments, Loans, Advances, Guarantees
and Acquisitions...........................43
SECTION 8.05. Hedging Agreements.........................44
SECTION 8.06. Restricted Payments; Certain Payments of
Indebtedness...............................44
SECTION 8.07. Transactions with Affiliates...............45
SECTION 8.08. Restrictive Agreements.....................45
SECTION 8.09. Disposition of Assets......................45
SECTION 8.10. Sale and Leaseback.........................46
SECTION 8.11. Accounting.................................46
SECTION 8.12. Amendment of Material Documents............46
SECTION 8.13. Preferred Equity Interests.................46
ARTICLE IX Financial Covenants ...............................46
SECTION 9.01. Consolidated Leverage Ratio................46
SECTION 9.02. Consolidated Fixed Charge Coverage Ratio...46
SECTION 9.03. Liquidity..................................46
ARTICLE X Events of Default .................................46
SECTION 10.01. Default....................................46
SECTION 10.02. Performance by the Administrative Agent....49
ARTICLE XI The Administrative Agent ..........................49
ARTICLE XII Miscellaneous .....................................51
SECTION 12.01. Notices....................................51
SECTION 12.02. Waivers; Amendments........................51
SECTION 12.03. Expenses; Indemnity; Damage Waiver.........52
SECTION 12.04. Successors and Assigns.....................53
SECTION 12.05. Survival...................................56
SECTION 12.06. Counterparts; Effectiveness................56
SECTION 12.07. Severability...............................56
SECTION 12.08. Right of Setoff............................56
SECTION 12.09. GOVERNING LAW; VENUE; SERVICE OF PROCESS...56
SECTION 12.10. WAIVER OF JURY TRIAL.......................57
SECTION 12.11. Headings...................................57
SECTION 12.12. Confidentiality............................57
SECTION 12.13. Maximum Interest Rate......................58
SECTION 12.14. Non-Application of Chapter 346 of Texas
Finance Code...............................58
SECTION 12.15. NO ORAL AGREEMENTS.........................58
SECTION 12.16. No Fiduciary Relationship..................58
SECTION 12.17. Construction...............................58
AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT (this "Agreement") dated as
of August 31, 2001, among PEGASUS SOLUTIONS, INC., formerly known as PEGASUS
SYSTEMS, INC., as Borrower, the LENDERS party hereto, and THE CHASE
MANHATTAN BANK, as successor to CHASE BANK OF TEXAS, NATIONAL ASSOCIATION,
as Administrative Agent, and THE CHASE MANHATTAN BANK, as Issuing Bank.
RECITALS:
A. The Administrative Agent, the Lenders and the Borrower have
previously entered into that certain Credit Agreement dated as of April 17,
2000. as amended and modified (the "Prior Credit Agreement") providing for a
revolving credit facility to Borrower in an amount not to exceed
$30,000,000.00.
B. The Administrative Agent, the Lenders and the Borrower now desire
that the Prior Credit Agreement be amended to permit the Borrower to request
Letters of Credit under the revolving credit facility in an amount not to
exceed $10,000,000.
C. For administrative convenience, the Administrative Agent, the
Lenders and the Borrower desire to accomplish such amendment by amending and
restating the Prior Credit Agreement in its entirety.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereto agree that the Prior Credit Agreement
is hereby amended and restated in its entirety as follows:
ARTICLE I
Definitions
SECTION 1.01. Defined Terms. As used in this Agreement, the following terms
have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Alternate Base Rate.
"Acquisition" means any transaction or series of related transactions
for the direct or indirect (a) acquisition of all or substantially all of
the property of a Person, or of any business or division of a Person,
(b) acquisition of in excess of 50% of the Equity Interests of any Person,
or otherwise causing any Person to become a Subsidiary, or (c) a merger or
consolidation or any other combination with another Person.
"Acquisition Documents" means all documents executed or provided in
connection with any Acquisition.
"Adjusted LIBO Rate" means, with respect to any Eurodollar Borrowing
for any Interest Period, an interest rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such
Interest Period multiplied by (b) the Statutory Reserve Rate.
"Administrative Agent" means The Chase Manhattan Bank, as successor to
Chase Bank of Texas, National Association, in its capacity as administrative
agent for the Lenders hereunder.
"Administrative Questionnaire" means an Administrative Questionnaire in
a form supplied by the Administrative Agent.
"Affiliate" means, with respect to a specified Person, another Person
that directly, or indirectly through one or more intermediaries, Controls or
is Controlled by or is under common Control with the Person specified.
"Alternate Base Rate" means, for any day, a rate per annum equal to the
greatest of (a) the Prime Rate in effect on such day, (b) the CD Rate plus
1% and (c) the Federal Funds Effective Rate in effect on such day plus 0.5%.
Any change in the Alternate Base Rate due to a change in the Prime Rate, the
CD Rate or the Federal Funds Effective Rate shall be effective from and
including the effective date of such change in the Prime Rate, the CD Rate
or the Federal Funds Effective Rate, respectively.
"Applicable Margin" means, for any day, (a) the margin of interest over
the Base Rate or the Adjusted LIBO Rate, as the case may be, that is
applicable when the Base Rate or the Adjusted LIBO Rate, as applicable, is
determined under this Agreement, and (b) the rate per annum used for the
Commitment Fee.
(a) From the Closing Date through the date that Administrative
Agent receives the Compliance Certificate and accompanying financial
statements for the fiscal period of the Borrower ending June 30, 2000,
the Applicable Margin shall be 2.00% for Eurodollar Borrowings, 1.00%
for Base Rate Borrowings and 0.25% for the Commitment Fee.
(b) After receipt of the Compliance Certificate and accompanying
financial statements for the fiscal period of Borrower ending June 30,
2000, (i) the Applicable Margin in effect at any time (whether in the
middle of an Interest Period or otherwise) shall be based upon the
Consolidated Leverage Ratio as determined from the related Compliance
Certificate then most recently received by the Administrative Agent,
effective as of the date received by the Administrative Agent, and
(ii) the Applicable Margin is subject to adjustment (upwards or
downwards, as appropriate), as stated in the following table:
Consolidated Leverage Applicable Applicable Applicable
Ratio Margin for Margin for Margin for
Base Rate Eurodollar Commitment
Borrowings Borrowings Fee
------------------------ ---------- ---------- ----------
Greater than or equal to 1.25% 2.25% 0.50%
1.50 to 1.00
Less than 1.50 to 1.00, 1.00% 2.00% 0.25%
but greater than or equal
to 1.00 to 1.00
Less than 1.00 to 1.00, 0.75% 1.75% 0.25%
but greater than or equal
to 0.50 to 1.00
Less than 0.50 to 1.00 0.50% 1.50% 0.25%
(c) If Borrower fails to timely furnish to the Administrative
Agent any financial information and related Compliance Certificate as
required by this Agreement, then the maximum Applicable Margin applies
from the date such financial information and related Compliance
Certificate are required to be delivered and remain in effect until the
Borrower furnishes them to the Administrative Agent.
"Applicable Percentage" means, with respect to any Lender, the
percentage of the total Commitments represented by such Lender's Commitment.
If the Commitments have terminated or expired, the Applicable Percentages
shall be determined based upon the Commitments most recently in effect,
giving effect to any assignments.
"Arranger" means Chase Securities Inc.
"Assignment and Acceptance" means an assignment and acceptance entered
into by a Lender and an assignee (with the consent of any party whose
consent is required by Section 12.04), and accepted by the Administrative
Agent, in the form of Exhibit "H" or any other form approved by the
Administrative Agent.
"Availability Period" means the period from and including the Effective
Date to but excluding the earlier of the Maturity Date and the date of
termination of the Commitments.
"Board" means the Board of Governors of the Federal Reserve System of
the United States of America.
"Borrower" means Pegasus Solutions, Inc., formerly known as Pegasus
Systems, Inc., a Delaware corporation.
"Borrowing" means Revolving Loans of the same Type, made, converted or
continued on the same date and, in the case of Eurodollar Loans, as to which
a single Interest Period is in effect.
"Borrowing Request" means a request by the Borrower for a Borrowing in
accordance with Section 2.03.
"Borrowing Request Form" means a certificate in substantially the form
of Exhibit "B", properly completed and signed by the Borrower requesting a
Borrowing or a conversion or continuation of a Borrowing.
"Business Day" means any day that is not a Saturday, Sunday or other
day on which commercial banks in Dallas, Texas are authorized or required by
law to remain closed; provided that, when used in connection with a
Eurodollar Loan, the term "Business Day" shall also exclude any day on which
banks are not open for dealings in dollar deposits in the London interbank
market.
"Capital Expenditures" means, for any period, (a) the additions to
property, plant and equipment and other capital expenditures of the Borrower
and its Subsidiaries that are (or would be) set forth in a consolidated
statement of cash flows of the Borrower for such period prepared in
accordance with GAAP, but excluding expenditures made in connection with the
replacement, substitution or restoration of assets to the extent financed
(i) from insurance proceeds (or other similar recoveries) paid on account of
the loss or damage to the assets being replaced or restored, but only to the
extent such proceeds or recoveries are not included in EBITDA or (ii) with
awards of compensation arising from the taking by eminent domain or
condemnation of the assets being replaced, but only to the extent such
awards are not included in EBITDA, and (b) Capital Lease Obligations
incurred by the Borrower and its Subsidiaries during such period.
"Capital Lease Obligations" of any Person means the obligations of such
Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination
thereof, which obligations are required to be classified and accounted for
as capital leases on a balance sheet of such Person under GAAP, and the
amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"CD Rate" means the secondary market rate for three-month certificates
of deposit (adjusted for statutory reserve requirements).
"Change in Control" means (a) the acquisition of ownership, directly or
indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934 and the rules of the
Securities and Exchange Commission thereunder as in effect on the date
hereof), of shares representing more than 30% of either the aggregate
ordinary voting power or the aggregate equity value represented by the
issued and outstanding capital stock of the Borrower; (b) occupation of a
majority of the seats (other than vacant seats) on the board of directors of
the Borrower by Persons who were neither (i) nominated by the board of
directors of the Borrower nor (ii) appointed by directors so nominated; or
(c) the acquisition of direct or indirect Control of the Borrower by any
Person or group.
"Change in Law" means (a) the adoption of any law, rule or regulation
after the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any
Governmental Authority after the date of this Agreement or (c) compliance by
any Lender or the Issuing Bank (or, for purposes of Section 3.01(b), by any
lending office of such Lender or by such Lender's or the Issuing Bank's
holding company, if any) with any request, guideline or directive (whether
or not having the force of law) of any Governmental Authority made or issued
after the date of this Agreement.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Collateral" has the meaning specified in Section 4.01.
"Commitment" means, with respect to each Lender, the commitment of such
Lender to make Revolving Loans and to acquire participations in Letters of
Credit hereunder, expressed as an amount representing the maximum aggregate
amount of such Lender's Revolving Credit Exposure hereunder, as such
commitment may be (a) reduced from time to time pursuant to Section 2.06 and
(b) reduced or increased from time to time pursuant to assignments by or to
such Lender pursuant to Section 12.04. The initial amount of each Lender's
Commitment is set forth on Schedule 2.01, or in the Assignment and
Acceptance pursuant to which such Lender shall have assumed its Commitment,
as applicable. The initial aggregate amount of the Lenders' Commitments is
$30,000,000.
"Commitment Fee" means the commitment fee payable pursuant to Section
2.09.
"Company" means REZ, Inc. (formerly known as REZsolutions, Inc.), a
Delaware corporation.
"Compliance Certificate" means a certificate of a Financial Officer of
the Borrower, in the form of Exhibit "G" hereto.
"Consolidated Fixed Charge Coverage Ratio" means, as of the last day of
any fiscal quarter of the Borrower, the ratio of (a) EBITDA less Capital
Expenditures for the 12-month period ending on such day to (b) cash interest
expense of the Borrower and its Subsidiaries for the 12-month period ending
on such day.
"Consolidated Leverage Ratio" means, as of the last day of any fiscal
quarter of the Borrower, the ratio of (a) (i) Indebtedness of Borrower and
its Subsidiaries on a consolidated basis as of such last day, minus (ii)
Deposit Liabilities as of such last day, and minus (iii) the amount of
obligations in respect of Hedging Agreements as of such last day, determined
as provided in clause (m) of the definition of "Indebtedness" set forth in
this Section 1.01, to (b) EBITDA for the 12-month period ending on such day,
as adjusted for Acquisitions as hereinafter provided. Until Borrower has
delivered financial statements pursuant to Section 7.01 for four full fiscal
quarters of Borrower after the date of consummation of any Acquisition
(including the Acquisition of the Company), EBITDA for such 12-month period
shall be adjusted on a pro forma basis consistent with GAAP to include
historical EBITDA of the Person acquired pursuant to such Acquisition
(calculated in accordance with the definition of EBITDA set forth in this
Section 1.01 based on audited financial statements of such Person) as if
such Acquisition had occurred on the first day of such 12-month period.
"Consolidated Liquidity" means (a) the total amount of cash and
Permitted Investments of the Borrower and the Subsidiaries that are not
subject to any Lien, minus (b) the total amount of Deposit Liabilities.
"Control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person,
whether through the ability to exercise voting power, by contract or
otherwise. "Controlling" and "Controlled" have meanings correlative
thereto.
"Contribution and Indemnification Agreement" means a contribution and
indemnification agreement of the Borrower and each Guarantor, in
substantially the form of Exhibit "E", as the same may be amended,
supplemented, or modified from time to time.
"Default" means any event or condition which constitutes an Event of
Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Deposit Liabilities" means (a) any and all obligations of Borrower or
any Subsidiary with respect to deposits received for hotel reservations, and
(b) any and all deposits and prepaid fees paid under agreements between the
Borrower or any Subsidiary and their respective customers.
"Disclosed Matters" means the actions, suits and proceedings and the
environmental matters disclosed in Schedule 5.06.
"dollars" or "$" refers to lawful money of the United States of
America.
"EBITDA" means, for each period of determination, the sum of
(a) consolidated net income of the Borrower and its Subsidiaries for such
period (whether positive or negative), plus, (b) each of the following to
the extent actually deducted in arriving at consolidated net income for such
period and without duplication: depreciation, amortization, taxes, and
interest expense of the Borrower and its Subsidiaries for such period, plus
(c) to the extent actually deducted in arriving at consolidated net income
for such period and without duplication, nonrecurring expenses of the
Acquisition of the Company and any other Acquisition after the Effective
Date.
"Effective Date" means the date on which the conditions specified in
Section 6.01 are satisfied (or waived in accordance with Section 12.02).
"Environmental Laws" means all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental
Authority, relating in any way to the environment, preservation or
reclamation of natural resources, the management, release or threatened
release of any Hazardous Material or to health and safety matters.
"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation,
fines, penalties or indemnities), of the Borrower, any Subsidiary or the
Company directly or indirectly resulting from or based upon (a) violation of
any Environmental Law, (b) the generation, use, handling, transportation,
storage, treatment or disposal of any Hazardous Materials, (c) exposure to
any Hazardous Materials, (d) the release or threatened release of any
Hazardous Materials into the environment or (e) any contract, agreement or
other consensual arrangement pursuant to which liability is assumed or
imposed with respect to any of the foregoing.
"Equity Interests" means shares of capital stock, partnership
interests, membership interests in a limited liability company, beneficial
interests in a trust or other equity ownership interests in a Person.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single
employer under Section 414(b) or (c) of the Code or, solely for purposes of
Section 302 of ERISA and Section 412 of the Code, is treated as a single
employer under Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived);
(b) the existence with respect to any Plan of an "accumulated funding
deficiency" (as defined in Section 412 of the Code or Section 302 of ERISA),
whether or not waived; (c) the filing pursuant to Section 412(d) of the Code
or Section 303(d) of ERISA of an application for a waiver of the minimum
funding standard with respect to any Plan; (d) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability under Title IV of
ERISA with respect to the termination of any Plan; (e) the receipt by the
Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any
notice relating to an intention to terminate any Plan or Plans or to appoint
a trustee to administer any Plan; (f) the incurrence by the Borrower or any
of its ERISA Affiliates of any liability with respect to the withdrawal or
partial withdrawal from any Plan or Multiemployer Plan; or (g) the receipt
by the Borrower or any ERISA Affiliate of any notice, or the receipt by any
Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA.
"Eurodollar", when used in reference to any Loan or Borrowing, refers
to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Adjusted LIBO Rate.
"Event of Default" has the meaning assigned to such term in Article X.
"Excluded Taxes" means, with respect to the Administrative Agent, any
Lender, the Issuing Bank or any other recipient of any payment to be made by
or on account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the United
States of America, or by the jurisdiction under the laws of which such
recipient is organized or in which its principal office is located or, in
the case of any Lender, in which its applicable lending office is located,
(b) any branch profits taxes imposed by the United States of America or any
similar tax imposed by any other jurisdiction in which the Borrower is
located and (c) in the case of a Foreign Lender (other than an assignee
pursuant to a request by the Borrower under Section 2.13(b)), any
withholding tax that is imposed on amounts payable to such Foreign Lender at
the time such Foreign Lender becomes a party to this Agreement (or
designates a new lending office) or is attributable to such Foreign Lender's
failure to comply with Section 2.11(e), except to the extent that such
Foreign Lender (or its assignor, if any) was entitled, at the time of
designation of a new lending office (or assignment), to receive additional
amounts from the Borrower with respect to such withholding tax pursuant to
Section 2.11(a).
"Federal Funds Effective Rate" means, for any day, the weighted average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations
for such day for such transactions received by the Administrative Agent from
three Federal funds brokers of recognized standing selected by it.
"Financial Officer" means the chief financial officer, principal
accounting officer, treasurer or controller of the Borrower.
"Foreign Lender" means any Lender that is organized under the laws of a
jurisdiction other than that in which the Borrower is located. For purposes
of this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.
"Foreign Subsidiary" means any Subsidiary that is organized under the
laws of a jurisdiction other than the United States of America or any state
thereof or the District of Columbia.
"GAAP" means generally accepted accounting principles in the United
States of America.
"Governmental Authority" means the government of the United States of
America, any other nation or any political subdivision thereof, whether
state or local, and any agency, authority, instrumentality, regulatory body,
court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.
"Guarantee" of or by any Person (the "guarantor") means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of the guarantor, direct or
indirect, (a) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness or other obligation or to purchase
(or to advance or supply funds for the purchase of) any security for the
payment thereof, (b) to purchase or lease property, securities or services
for the purpose of assuring the owner of such Indebtedness or other
obligation of the payment thereof, (c) to maintain working capital, equity
capital or any other financial statement condition or liquidity of the
primary obligor so as to enable the primary obligor to pay such Indebtedness
or other obligation or (d) as an account party in respect of any letter of
credit or letter of guaranty issued to support such Indebtedness or
obligation; provided, that the term Guarantee shall not include endorsements
for collection or deposit in the ordinary course of business.
"Guarantors" means all of the Subsidiaries of the Borrower as of the
Effective Date (except any Foreign Subsidiary) and each other Subsidiary
that at any time executes a Guaranty in favor of the Administrative Agent,
the Issuing Bank and the Lenders, including the Company.
"Guaranty" means the guaranty agreement of each Guarantor in favor of
the Administrative Agent, the Issuing Bank and the Lenders, in substantially
the form of Exhibit "D" hereto, as the same may be amended, supplemented, or
modified from time to time.
"Hazardous Materials" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos
containing materials, polychlorinated biphenyls, radon gas, infectious or
medical wastes and all other substances or wastes of any nature regulated
pursuant to any Environmental Law.
"Hedging Agreement" means any interest rate protection agreement,
foreign currency exchange agreement, commodity price protection agreement or
other interest or currency exchange rate or commodity price hedging
arrangement.
"Indebtedness" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of
such Person under conditional sale or other title retention agreements
relating to property acquired by such Person, (e) all obligations of such
Person in respect of the deferred purchase price of property or services
(excluding current accounts payable incurred in the ordinary course of
business), (f) all Indebtedness of others secured by (or for which the
holder of such Indebtedness has an existing right, contingent or otherwise,
to be secured by) any Lien on property owned or acquired by such Person,
whether or not the Indebtedness secured thereby has been assumed, (g) all
Guarantees by such Person of Indebtedness of others, (h) all Capital Lease
Obligations of such Person, (i) all obligations, contingent or otherwise, of
such Person as an account party in respect of letters of credit and letters
of guaranty, (j) all obligations, contingent or otherwise, of such Person in
respect of bankers' acceptances, (k) all reimbursement obligations of such
Person (whether contingent or otherwise) in respect of letters of credit,
bankers' acceptances, surety or other bonds and similar instruments, (l) all
liabilities of such Person in respect of unfunded vested benefits under any
Plan and (m) payment obligations with respect to Hedging Agreements,
provided that for purposes of this definition, the amount of the obligation
of any Person under any Hedging Agreement shall be the amount determined, in
respect thereof as of the end of the most recently ended fiscal quarter of
such Person, based on the assumption that such Hedging Agreement has
terminated at the end of such fiscal quarter, and in making such
determination, if such Hedging Agreement provides for the netting of amounts
payable by and to each party thereto or if any Hedging Agreement provides
for the simultaneous payment of amounts by and to each party, then in each
such case, the amount of such obligation shall be the net amount so
determined. The Indebtedness of any Person shall include the Indebtedness
of any other entity (including any partnership in which such Person is a
general partner) to the extent such Person is liable therefor as a result of
such Person's ownership interest in or other relationship with such entity,
except to the extent the terms of such Indebtedness provide that such Person
is not liable therefor.
"Indemnified Taxes" means Taxes other than Excluded Taxes.
"Interest Election Request" means a request by the Borrower to convert
or continue a Borrowing in accordance with Section 2.05.
"Interest Payment Date" means (a) with respect to any ABR Loan, the
last day of each March, June, September and December and (b) with respect to
any Eurodollar Loan, the last day of the Interest Period applicable to the
Borrowing of which such Loan is a part and, in the case of a Eurodollar
Borrowing with an Interest Period of more than three months' duration, each
day prior to the last day of such Interest Period that occurs at intervals
of three months' duration after the first day of such Interest Period.
"Interest Period" means, with respect to any Eurodollar Borrowing, the
period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the calendar month that is one, two, three
or six months thereafter, as the Borrower may elect, and provided, that
(i) if any Interest Period would end on a day other than a Business Day,
such Interest Period shall be extended to the next succeeding Business Day
unless such next succeeding Business Day would fall in the next calendar
month, in which case such Interest Period shall end on the next preceding
Business Day and (ii) any Interest Period that commences on the last
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the last calendar month of such Interest
Period) shall end on the last Business Day of the last calendar month of
such Interest Period. For purposes hereof, the date of a Borrowing
initially shall be the date on which such Borrowing is made and thereafter
shall be the effective date of the most recent conversion or continuation of
such Borrowing.
"Issuing Bank" means The Chase Manhattan Bank, in its capacity as the
issuer of Letters of Credit hereunder, and its successors in such capacity
as provided in Section 2.14(i). The Issuing Bank may, in its discretion,
arrange for one or more Letters of Credit to be issued by Affiliates of the
Issuing Bank, in which case the term "Issuing Bank" shall include any such
Affiliate with respect to Letters of Credit issued by such Affiliate.
"LC Disbursement" means a payment made by the Issuing Bank pursuant to
a Letter of Credit.
"LC Exposure" means, at any time, the sum of (a) the aggregate undrawn
amount of all outstanding Letters of Credit at such time plus (b) the
aggregate amount of all LC Disbursements that have not yet been reimbursed
by or on behalf of the Borrower at such time. The LC Exposure of any Lender
at any time shall be its Applicable Percentage of the total LC Exposure at
such time.
"Lenders" means the Persons listed on Schedule 2.01 and any other
Person that shall have become a party hereto pursuant to an Assignment and
Acceptance, other than any such Person that ceases to be a party hereto
pursuant to an Assignment and Acceptance.
"Letter of Credit" means any letter of credit issued pursuant to this
Agreement.
"LIBO Rate" means, with respect to any Eurodollar Borrowing for any
Interest Period, the rate appearing on Page 3750 of the Telerate Service (or
on any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations
of interest rates applicable to dollar deposits in the London interbank
market) at approximately 11:00 a.m., London time, two Business Days prior to
the commencement of such Interest Period, as the rate for dollar deposits
with a maturity comparable to such Interest Period. In the event that such
rate is not available at such time for any reason, then the "LIBO Rate" with
respect to such Eurodollar Borrowing for such Interest Period shall be the
rate at which dollar deposits of $5,000,000 and for a maturity comparable to
such Interest Period are offered by the principal London office of the
Administrative Agent in immediately available funds in the London interbank
market at approximately 11:00 a.m., London time, two Business Days prior to
the commencement of such Interest Period.
"Lien" means, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, hypothecation, encumbrance, charge or security interest
in, on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or
any financing lease having substantially the same economic effect as any of
the foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.
"Loan Documents" means this Agreement and all promissory notes,
security agreements, pledge agreements, deeds of trust, assignments, letters
of credit, letter of credit applications, guaranties, intercreditor
agreements, collateral sharing agreements, and other instruments, documents,
and agreements executed and delivered pursuant to or in connection with this
Agreement, as such instruments, documents, and agreements may be amended,
modified, renewed, extended, or supplemented from time to time.
"Loans" means the loans made by the Lenders to the Borrower pursuant to
this Agreement.
"Material Adverse Effect" means a material adverse effect on (a) the
business, assets, operations or condition, financial or otherwise, of the
Borrower and the Subsidiaries taken as a whole, (b) the ability of the
Borrower or any Guarantor to pay and perform any of the Obligations, (c) any
of the rights of or benefits available to the Administrative Agent, the
Issuing Bank and the Lenders under this Agreement or any of the other Loan
Documents, or (d) the validity or enforceability of this Agreement or any of
the other Loan Documents. For purposes of Article V hereof, the term
"Subsidiaries" as used within the definition of Material Adverse Effect
includes the Company.
"Material Indebtedness" means Indebtedness (other than the Loans and
Letters of Credit), including obligations in respect of one or more Hedging
Agreements, of any one or more of the Borrower and its Subsidiaries in an
aggregate principal amount exceeding $1,000,000. For purposes of
determining Material Indebtedness, the "principal amount" of the obligations
of the Borrower or any Subsidiary in respect of any Hedging Agreement at any
time shall be the amount of its payment obligations thereunder determined as
provided in clause (m) of the definition of "Indebtedness" set forth in this
Section 1.01.
"Maturity Date" means March 31, 2002.
"Maximum Rate" means, at any time and with respect to any Lender, the
maximum rate of interest under applicable law that such Lender may charge
the Borrower. The Maximum Rate shall be calculated in a manner that takes
into account any and all fees, payments, and other charges in respect of the
Loan Documents that constitute interest under applicable law. Each change
in any interest rate provided for herein based upon the Maximum Rate
resulting from a change in the Maximum Rate shall take effect without notice
to the Borrower at the time of such change in the Maximum Rate. For
purposes of determining the Maximum Rate under Texas law, the applicable
rate ceiling shall be the weekly ceiling described in, and computed in
accordance with, Chapter 303 of the Texas Finance Code.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" means a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"Note" means a promissory note of the Borrower payable to the order of
a Lender, in substantially the form of Exhibit "A" hereto, and all
extensions, renewals, and modifications thereof and all substitutions
therefor.
"Obligations" means all obligations, indebtedness, and liabilities of
the Borrower and the Subsidiaries, or any of them, to the Administrative
Agent, the Issuing Bank, the Arranger and the Lenders, or any of them,
arising pursuant to any of the Loan Documents or Hedging Agreements, now
existing or hereafter arising, whether direct, indirect, related, unrelated,
fixed, contingent, liquidated, unliquidated, joint, several, or joint and
several, and all interest accruing thereon and all attorneys' fees and other
expenses incurred in the enforcement or collection thereof.
"Other Taxes" means any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies
arising from any payment made hereunder or from the execution, delivery or
enforcement of, or otherwise with respect to, this Agreement.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA and any successor entity performing similar functions.
"Permitted Encumbrances" means:
(d) Liens imposed by law for taxes that are not yet due or are
being contested in compliance with Section 7.04;
(e) carriers', warehousemen's, mechanics', materialmen's,
repairmen's and other like Liens imposed by law, arising in the
ordinary course of business and securing obligations that are not
overdue by more than 30 days or are being contested in compliance with
Section 7.04;
(f) pledges and deposits made in the ordinary course of business
in compliance with workers' compensation, unemployment insurance and
other social security laws or regulations;
(g) deposits to secure the performance of bids, trade contracts,
leases, statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature, in each case in the
ordinary course of business;
(h) judgment liens in respect of judgments that do not constitute
an Event of Default under clause (k) of Article X; and
(i) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary
course of business that do not secure any monetary obligations and do
not materially detract from the value of the affected property or
interfere with the ordinary conduct of business of the Borrower or any
Subsidiary;
provided that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness.
"Permitted Investments" means:
(j) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States
of America (or by any agency thereof to the extent such obligations are
backed by the full faith and credit of the United States of America),
in each case maturing within one year from the date of acquisition
thereof;
(k) investments in commercial paper maturing within 270 days from
the date of acquisition thereof and having, at such date of
acquisition, the highest credit rating obtainable from S&P or from
Moody's;
(l) investments in certificates of deposit, banker's acceptances
and time deposits maturing within 180 days from the date of acquisition
thereof issued or guaranteed by or placed with, and money market
deposit accounts issued or offered by, any domestic office of any
commercial bank organized under the laws of the United States of
America or any State thereof which has a combined capital and surplus
and undivided profits of not less than $500,000,000;
(m) fully collateralized repurchase agreements with a term of not
more than 30 days for securities described in clause (a) above and
entered into with a financial institution satisfying the criteria
described in clause (c) above; and
(n) other investments of the types specified as "appropriate
investments" as set forth in the Borrower's investment policy, a copy
of which is attached hereto as Schedule 1.01.
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.
"Plan" means any employee pension benefit plan subject to the
provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of
ERISA, and in respect of which the Borrower or any ERISA Affiliate is (or,
if such plan were terminated, would under Section 4069 of ERISA be deemed to
be) an "employer" as defined in Section 3(5) of ERISA.
"Prime Rate" means the rate of interest per annum announced from time
to time by The Chase Manhattan Bank as its prime rate in effect at its
principal office in New York City, each change in the Prime Rate shall be
effective from and including the date such change is announced as being
effective.
"Register" has the meaning set forth in Section 12.04.
"Related Parties" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees,
agents and advisors of such Person and such Person's Affiliates.
"Required Lenders" means, at any time, Lenders having Revolving Credit
Exposures and unused Commitments representing more than 66% of the sum of
the total Revolving Credit Exposures and unused Commitments at such time.
"Restricted Payment" means any dividend or other distribution (whether
in cash, securities or other property) with respect to any Equity Interests
of the Borrower or any Subsidiary, or any payment (whether in cash,
securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any Equity Interests of the Borrower or any
Subsidiary or any option, warrant or other right to acquire any Equity
Interests of the Borrower or any Subsidiary.
"Revolving Credit Exposure" means, with respect to any Lender at any
time, the sum of the outstanding principal amount of such Lender's Revolving
Loans and its LC Exposure at such time.
"Revolving Loan" means a Loan made pursuant to Section 2.02 hereof.
"S&P" means Standard & Poor's.
"Security Agreement" means the Security Agreement of the Borrower and
the Subsidiaries (including the Company) in favor of the Administrative
Agent for the benefit of the Administrative Agent, the Issuing Bank and the
Lenders, in substantially the form of Exhibit "C" hereto, as the same may be
amended, supplemented or modified from time to time.
"Solvent" means, as to any Person, that (a) the aggregate fair market
value of its assets exceeds its liabilities, (b) it has sufficient cash flow
to enable it to pay its Indebtedness as such Indebtedness matures, and
(c) it does not have unreasonably small capital to conduct its business.
"Statutory Reserve Rate" means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the
number one minus the aggregate of the maximum reserve percentages (including
any marginal, special, emergency or supplemental reserves) expressed as a
decimal established by the Board to which the Administrative Agent is
subject for eurocurrency funding (currently referred to as "Eurocurrency
Liabilities" in Regulation D of the Board). Such reserve percentages shall
include those imposed pursuant to such Regulation D. Eurodollar Loans shall
be deemed to constitute eurocurrency funding and to be subject to such
reserve requirements without benefit of or credit for proration, exemptions
or offsets that may be available from time to time to any Lender under such
Regulation D or any comparable regulation. The Statutory Reserve Rate shall
be adjusted automatically on and as of the effective date of any change in
any reserve percentage.
"Subordinated Debt" means the indebtedness of Borrower evidenced by the
Subordinated Note.
"Subordinated Note" means that certain promissory note dated April 3,
2000, executed by Borrower in connection with the Acquisition of the
Company, and payable to the order of Utell International Group Ltd., in the
principal amount of $20,000,000.
"subsidiary" means, with respect to any Person (the "parent") at any
date, any corporation, limited liability company, partnership, association
or other entity the accounts of which would be consolidated with those of
the parent in the parent's consolidated financial statements if such
financial statements were prepared in accordance with GAAP as of such date,
as well as any other corporation, limited liability company, partnership,
association or other entity (a) of which securities or other ownership
interests representing more than 50% of the equity or more than 50% of the
ordinary voting power or, in the case of a partnership, more than 50% of the
general partnership interests are, as of such date, owned, controlled or
held, or (b) that is, as of such date, otherwise Controlled, by the parent
or one or more subsidiaries of the parent or by the parent and one or more
subsidiaries of the parent.
"Subsidiary" means any subsidiary of the Borrower. For purposes of the
representations and warranties made herein on the Effective Date, the term
"Subsidiary" includes each of the Company and its Subsidiaries, except for
clauses (a) and (b) of Section 5.04.
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Transactions" means the execution, delivery and performance by the
Borrower and each Guarantor of this Agreement and the other Loan Documents
to which it is a party, the borrowing of Loans, the use of the proceeds
thereof and the issuance of Letters of Credit hereunder.
"Type", when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the
Alternate Base Rate.
"UCC" means the Uniform Commercial Code as in effect in the State of
Texas.
"Withdrawal Liability" means liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as
such terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including"
shall be deemed to be followed by the phrase "without limitation". The word
"will" shall be construed to have the same meaning and effect as the word
"shall". Unless the context requires otherwise (a) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as
from time to time amended, supplemented or otherwise modified (subject to
any restrictions on such amendments, supplements or modifications set forth
herein), (b) any reference herein to any Person shall be construed to
include such Person's successors and assigns, (c) the words "herein",
"hereof" and "hereunder", and words of similar import, shall be construed to
refer to this Agreement in its entirety and not to any particular provision
hereof, (d) all references herein to Articles, Sections, Exhibits and
Schedules shall be construed to refer to Articles and Sections of, and
Exhibits and Schedules to, this Agreement and (e) the words "asset" and
"property" shall be construed to have the same meaning and effect and to
refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.
SECTION 1.03. Accounting Terms; GAAP. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; provided that, if the
Borrower notifies the Administrative Agent that the Borrower requests an
amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the
operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision
hereof for such purpose), regardless of whether any such notice is given
before or after such change in GAAP or in the application thereof, then such
provision shall be interpreted on the basis of GAAP as in effect and applied
immediately before such change shall have become effective until such
notice shall have been withdrawn or such provision amended in accordance
herewith.
ARTICLE II
The Credits
SECTION 2.01 Commitments.
Subject to the terms and conditions set forth herein,
each Lender agrees to make Revolving Loans to the Borrower from time to time
during the Availability Period in an aggregate principal amount that will
not result in (a) such Lender's Revolving Credit Exposure exceeding such
Lender's Commitment, or (b) the sum of the total Revolving Credit Exposures
exceeding the total Commitments. Within the foregoing limits and subject to
the terms and conditions set forth herein, the Borrower may borrow, prepay
and reborrow Revolving Loans.
SECTION 2.02. Loans and Borrowings.
(a) Each Revolving Loan shall be made as part of a Borrowing
consisting of Revolving Loans made by the Lenders ratably in accordance with
their respective Commitments. The failure of any Lender to make any Loan
required to be made by it shall not relieve any other Lender of its
obligations hereunder; provided that the Commitments of the Lenders are
several and no Lender shall be responsible for any other Lender's failure to
make Loans as required.
(b) Subject to Sections 3.02, 3.03 and 3.04, each Borrowing shall
be comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may
request in accordance herewith. Each Lender at its option may make any
Eurodollar Loan by causing any domestic or foreign branch or Affiliate of
such Lender to make such Loan; provided that any exercise of such option
shall not affect the obligation of the Borrower to repay such Loan in
accordance with the terms of this Agreement.
(c) At the commencement of each Interest Period for any Eurodollar
Borrowing, such Borrowing shall be in an aggregate amount that is an
integral multiple of $500,000 and not less than $1,000,000. At the time
that each ABR Borrowing is made, such Borrowing shall be in an aggregate
amount that is an integral multiple of $500,000 and not less than $1,000,000
provided that an ABR Borrowing may be in an aggregate amount that is equal
to the entire unused balance of the total Commitments or that is required to
finance the reimbursement of an LC Disbursement as contemplated by
Section 2.14(e). Borrowings of more than one Type may be outstanding at the
same time; provided that there shall not at any time be more than a total of
three Eurodollar Borrowings outstanding.
(d) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to request, or to elect to convert or
continue, any Borrowing if the Interest Period requested with respect
thereto would end after the Maturity Date.
SECTION 2.03. Requests for Borrowings. To request a Borrowing, the Borrower
shall notify the Administrative Agent of such request by telephone (a) in
the case of a Eurodollar Borrowing, not later than 11:00 a.m., Dallas, Texas
time, three Business Days before the date of the proposed Borrowing or
(b) in the case of an ABR Borrowing, not later than 11:00 a.m., Dallas,
Texas time, on the same Business Day as the date of the proposed Borrowing,
provided that any such notice of an ABR Borrowing to finance the
reimbursement of an LC Disbursement as contemplated by Section 2.14(e) may
be given not later than 10:00 a.m., Dallas, Texas time, on the date of the
proposed Borrowing. Each such telephonic Borrowing Request shall be
irrevocable and shall be confirmed promptly by hand delivery or telecopy to
the Administrative Agent of a written Borrowing Request by means of a
Borrowing Request Form signed by the Borrower. Each such telephonic and
written Borrowing Request shall specify the following information in
compliance with Section 2.02:
(i) the aggregate amount of the requested Borrowing;
(ii) the date of such Borrowing, which shall be a Business
Day;
(iii) whether such Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing;
(iv) in the case of a Eurodollar Borrowing, the initial
Interest Period to be applicable thereto, which shall be a period
contemplated by the definition of the term "Interest Period"; and
(v) the location and number of the Borrower's account to
which funds are to be disbursed, which shall comply with the
requirements of Section 2.04.
If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified
with respect to any requested Eurodollar Borrowing, then the Borrower shall
be deemed to have selected an Interest Period of one month's duration.
Promptly following receipt of a Borrowing Request in accordance with this
Section, the Administrative Agent shall advise each Lender of the details
thereof and of the amount of such Lender's Loan to be made as part of the
requested Borrowing.
SECTION 2.04. Funding of Borrowings.
(a) Each Lender shall make each Loan to be made by it hereunder on
the proposed date thereof by wire transfer of immediately available funds by
2:00 p.m., Dallas, Texas time, to the account of the Administrative Agent
most recently designated by it for such purpose by notice to the Lenders.
The Administrative Agent will make such Loans available to the Borrower by
promptly crediting the amounts so received, in like funds, to an account of
the Borrower maintained with the Administrative Agent in Dallas, Texas and
designated by the Borrower in the applicable Borrowing Request; provided
that ABR Loans made to finance the reimbursement of an LC Disbursement as
provided in Section 2.14(e) shall be remitted by the Administrative Agent to
the Issuing Bank.
(b) Unless the Administrative Agent shall have received notice
from a Lender prior to the proposed date of any Borrowing that such Lender
will not make available to the Administrative Agent such Lender's share of
such Borrowing, the Administrative Agent may assume that such Lender has
made such share available on such date in accordance with paragraph (a) of
this Section and may, in reliance upon such assumption, make available to
the Borrower a corresponding amount. In such event, if a Lender has not in
fact made its share of the applicable Borrowing available to the
Administrative Agent, then the applicable Lender and the Borrower severally
agree to pay to the Administrative Agent forthwith on demand such
corresponding amount with interest thereon, for each day from and including
the date such amount is made available to the Borrower to but excluding the
date of payment to the Administrative Agent, at (i) in the case of such
Lender, the greater of the Federal Funds Effective Rate and a rate
determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation or (ii) in the case of the Borrower, the
interest rate applicable to ABR Loans. If such Lender pays such amount to
the Administrative Agent, then such amount shall constitute such Lender's
Loan included in such Borrowing.
SECTION 2.05. Interest Elections.
(a) Each Borrowing initially shall be of the Type specified in the
applicable Borrowing Request and, in the case of a Eurodollar Borrowing,
shall have an initial Interest Period as specified in such Borrowing
Request. Thereafter, the Borrower may elect to convert such Borrowing to a
different Type or to continue such Borrowing and, in the case of a
Eurodollar Borrowing, may elect Interest Periods therefor, all as provided
in this Section. The Borrower may elect different options with respect to
different portions of the affected Borrowing, in which case each such
portion shall be allocated ratably among the Lenders holding the Loans
comprising such Borrowing, and the Loans comprising each such portion shall
be considered a separate Borrowing.
(b) To make an election pursuant to this Section, the Borrower
shall notify the Administrative Agent of such election by telephone by the
time that a Borrowing Request would be required under Section 2.03 if the
Borrower were requesting a Borrowing of the Type resulting from such
election to be made on the effective date of such election. Each such
telephonic Interest Election Request shall be irrevocable and shall be
confirmed promptly by hand delivery or telecopy to the Administrative Agent
of a written Interest Election Request by means of a Borrowing Request Form
signed by the Borrower.
(c) Each telephonic and written Interest Election Request shall
specify the following information in compliance with Section 2.02 and 2.03:
(i) the Borrowing to which such Interest Election Request
applies and, if different options are being elected with respect
to different portions thereof, the portions thereof to be
allocated to each resulting Borrowing (in which case the
information to be specified pursuant to clauses (iii) and (iv)
below shall be specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR
Borrowing or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing,
the Interest Period to be applicable thereto after giving effect
to such election, which shall be a period contemplated by the
definition of the term "Interest Period".
If any such Interest Election Request requests a Eurodollar Borrowing but
does not specify an Interest Period, then the Borrower shall be deemed to
have selected an Interest Period of one month's duration.
(d) Promptly following receipt of an Interest Election Request,
the Administrative Agent shall advise each Lender of the details thereof and
of such Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election
Request with respect to a Eurodollar Borrowing prior to the end of the
Interest Period applicable thereto, then, unless such Borrowing is repaid as
provided herein, at the end of such Interest Period such Borrowing shall be
converted to an ABR Borrowing. Notwithstanding any contrary provision
hereof, if an Event of Default has occurred and is continuing and the
Administrative Agent, at the request of the Required Lenders, so notifies
the Borrower, then, so long as an Event of Default is continuing (i) no
outstanding Borrowing may be converted to or continued as a Eurodollar
Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be
converted to an ABR Borrowing at the end of the Interest Period applicable
thereto.
SECTION 2.06. Termination and Reduction of Commitments.
(a) Unless previously terminated, the Commitments shall terminate
on the Maturity Date.
(b) The Borrower may at any time terminate, or from time to time
reduce, the Commitments; provided that (i) each reduction of the Commitments
shall be in an amount that is an integral multiple of $1,000,000 and not
less than $1,000,000 and (ii) the Borrower shall not terminate or reduce the
Commitments if, after giving effect to any concurrent prepayment of the
Loans in accordance with Section 2.08, the Revolving Credit Exposures would
exceed the total Commitments.
(c) The Borrower shall notify the Administrative Agent of any
election to terminate or reduce the Commitments under paragraph (b) of this
Section at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the Lenders of the contents thereof. Each notice delivered by
the Borrower pursuant to this Section shall be irrevocable; provided that a
notice of termination of the Commitments delivered by the Borrower may state
that such notice is conditioned upon the effectiveness of other credit
facilities, in which case such notice may be revoked by the Borrower (by
notice to the Administrative Agent on or prior to the specified effective
date) if such condition is not satisfied. Any termination or reduction of
the Commitments shall be permanent. Each reduction of the Commitments shall
be made ratably among the Lenders in accordance with their respective
Commitments.
SECTION 2.07. Repayment of Loans; Evidence of Debt.
(a) The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of each Lender the then unpaid
principal amount of each Revolving Loan on the Maturity Date.
(b) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of the Borrower
to such Lender resulting from each Loan made by such Lender, including the
amounts of principal and interest payable and paid to such Lender from time
to time hereunder.
(c) The Administrative Agent shall maintain accounts in which it
shall record (i) the amount of each Loan made hereunder, the Type thereof
and the Interest Period applicable thereto, (ii) the amount of any principal
or interest due and payable or to become due and payable from the Borrower
to each Lender hereunder and (iii) the amount of any sum received by the
Administrative Agent hereunder for the account of the Lenders and each
Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to
paragraph (b) or (c) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any Lender or the Administrative Agent to maintain such accounts
or any error therein shall not in any manner affect the obligation of the
Borrower to repay the Loans in accordance with the terms of this Agreement.
(e) The obligation of the Borrower to repay each Lender for Loans
made by such Lender and interest thereon shall be evidenced by a Note
executed by the Borrower, payable to the order of such Lender, in the
principal amount of such Lender's Commitment as in effect on the date
hereof, and initially dated the date hereof.
SECTION 2.08. Prepayment of Loans.
(a) The Borrower shall have the right at any time and from time to
time to prepay any Borrowing in whole or in part, subject to prior notice in
accordance with paragraph (b) of this Section.
(b) The Borrower shall notify the Administrative Agent by
telephone (confirmed by telecopy) of any prepayment of a Eurodollar
Borrowing that will be made before the last day of the applicable Interest
Period and shall pay all amounts required to be paid by Section 3.05
concurrently with such prepayment. Such notice shall be given not later
than 11:00 a.m., Dallas, Texas time, on the date of prepayment. Each such
notice shall be irrevocable and shall specify the prepayment date and the
principal amount of each Borrowing or portion thereof to be prepaid;
provided that, if a notice of prepayment is given in connection with a
conditional notice of termination of the Commitments as contemplated by
Section 2.06, then such notice of prepayment may be revoked if such notice
of termination is revoked in accordance with Section 2.06. Promptly
following receipt of any such notice, the Administrative Agent shall advise
the Lenders of the contents thereof. Each partial prepayment of any
Borrowing shall be in an amount that would be permitted in the case of an
advance of a Borrowing of the same Type as provided in Section 2.02. Each
prepayment of a Borrowing shall be applied ratably to the Loans included in
the prepaid Borrowing. Prepayments shall be accompanied by accrued interest
to the extent required by Section 2.10.
(c) If at any time the total Revolving Credit Exposures exceeds
the total Commitments, the Borrower shall promptly prepay the outstanding
Borrowings by the amount of the excess plus accrued and unpaid interest on
the amount so prepaid.
SECTION 2.09. Fees.
(a) The Borrower agrees to pay to the Administrative Agent for the
account of each Lender (pro rata in accordance with the Commitment of each
Lender) a Commitment Fee on the daily average unused amount of the
Commitments for the Availability Period, at the rate per annum set forth in
the definition of Applicable Margin. For purposes of calculating the
Commitment Fee hereunder, the Commitments shall be deemed utilized by the
amount of all Borrowings. Accrued Commitment Fees payable under this
Section shall be payable in arrears on the last day of March, June,
September and December of each year and on the date on which the Commitments
terminate, commencing on the first such date to occur after the date hereof.
All Commitment Fees shall be computed on the basis of a year of 360 days and
shall be payable for the actual number of days elapsed (including the first
day but excluding the last day).
(b) The Borrower agrees to pay to the Administrative Agent, for
its own account, fees payable in the amounts and at the times separately
agreed upon between the Borrower and the Administrative Agent.
(c) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent (or to the Issuing
Bank, in the case of fees payable to it) for distribution, in the case of
Commitment Fees and participation fees, to the Lenders. Fees paid shall not
be refundable under any circumstances.
(d) The Borrower agrees to pay (i) to the Administrative Agent for
the account of each Lender a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same
Applicable Margin for Eurodollar Borrowings on the average daily amount of
such Lender's LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date on which such Lender's
Commitment terminates and the date on which such Lender ceases to have any
LC Exposure, and (ii) to the Issuing Bank a fronting fee, which shall accrue
at the rate of 1/8% of the face amount of each Letter of Credit when each
Letter of Credit is issued, as well as the Issuing Bank's standard fees with
respect to the issuance or amendment of any Letter of Credit or processing
of drawings thereunder. Participation fees accrued through and including
the last day of March, June, September and December of each year shall be
payable on the third Business Day following such last day, commencing on the
first such date to occur after the Effective Date; provided that all such
fees shall be payable on the date on which the Commitments terminate and any
such fees accruing after the date on which the Commitments terminate shall
be payable on demand. Any other fees payable to the Issuing Bank pursuant
to this paragraph shall be payable within 10 days after demand. All
participation fees shall be computed on the basis of a year of 360 days and
shall be payable for the actual number of days elapsed (including the first
day but excluding the last day).
SECTION 2.10. Interest.
(a) The Loans comprising each ABR Borrowing shall bear interest at
the Alternate Base Rate plus the Applicable Margin.
(b) The Loans comprising each Eurodollar Borrowing shall bear
interest at the Adjusted LIBO Rate for the Interest Period in effect for
such Borrowing plus the Applicable Margin.
(c) Notwithstanding the foregoing, if any principal of or interest
on any Loan or any fee or other amount payable by the Borrower hereunder is
not paid when due, whether at stated maturity, upon acceleration or
otherwise, such overdue amount shall bear interest, after as well as before
judgment, at a rate per annum equal to (i) in the case of overdue principal
of any Loan, 2% plus the rate otherwise applicable to such Loan as provided
in the preceding paragraphs of this Section or (ii) in the case of any other
amount, including interest and fees, 2% plus the rate applicable to ABR
Loans as provided in paragraph (a) of this Section.
(d) Accrued interest on each Loan shall be payable in arrears on
each Interest Payment Date for such Loan and upon termination of the
Commitments; provided that (i) interest accrued pursuant to paragraph (c) of
this Section shall be payable on demand, (ii) in the event of any repayment
or prepayment of any Loan (other than a prepayment of an ABR Loan prior to
the end of the Availability Period), accrued interest on the principal
amount repaid or prepaid shall be payable on the date of such repayment or
prepayment and (iii) in the event of any conversion of any Eurodollar Loan
prior to the end of the current Interest Period therefor, accrued interest
on such Loan shall be payable on the effective date of such conversion.
(e) All interest hereunder shall be computed on the basis of a
year of 360 days, except that interest computed by reference to the
Alternate Base Rate at times when the Alternate Base Rate is based on the
Prime Rate shall be computed on the basis of a year of 365 days (or 366 days
in a leap year), and in each case shall be payable for the actual number of
days elapsed (including the first day but excluding the last day). The
applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall be
determined by the Administrative Agent, and such determination shall be
conclusive absent manifest error.
SECTION 2.11. Taxes.
(a) Any and all payments by or on account of any obligation of the
Borrower hereunder shall be made free and clear of and without deduction for
any Indemnified Taxes or Other Taxes; provided that if the Borrower shall be
required to deduct any Indemnified Taxes or Other Taxes from such payments,
then (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) the Administrative Agent, Lender
or Issuing Bank (as the case may be) receives an amount equal to the sum it
would have received had no such deductions been made, (ii) the Borrower
shall make such deductions and (iii) the Borrower shall pay the full amount
deducted to the relevant Governmental Authority in accordance with
applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent, each
Lender, and the Issuing Bank within 10 days after written demand therefor,
for the full amount of any Indemnified Taxes or Other Taxes paid by the
Administrative Agent, such Lender or the Issuing Bank, as the case may be,
on or with respect to any payment by or on account of any obligation of the
Borrower hereunder (including Indemnified Taxes or Other Taxes imposed or
asserted on or attributable to amounts payable under this Section) and any
penalties, interest and reasonable expenses arising therefrom or with
respect thereto, whether or not such Indemnified Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental
Authority. A certificate as to the amount of such payment or liability
delivered to the Borrower by a Lender or the Issuing Bank, or by the
Administrative Agent on its own behalf or on behalf of a Lender or the
Issuing Bank, shall be conclusive absent manifest error.
(d) As soon as practicable after any payment of Indemnified Taxes
or Other Taxes by the Borrower to a Governmental Authority, the Borrower
shall deliver to the Administrative Agent the original or a certified copy
of a receipt issued by such Governmental Authority evidencing such payment,
a copy of the return reporting such payment or other evidence of such
payment reasonably satisfactory to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the law of the jurisdiction in which the
Borrower is located, or any treaty to which such jurisdiction is a party,
with respect to payments under this Agreement shall deliver to the Borrower
(with a copy to the Administrative Agent), at the time or times prescribed
by applicable law, such properly completed and executed documentation
prescribed by applicable law or reasonably requested by the Borrower as will
permit such payments to be made without withholding or at a reduced rate.
SECTION 2.12. Payments Generally; Pro Rata Treatment; Sharing of Set-offs.
(a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees or reimbursement of
LC Disbursements, or of amounts payable under Section 2.11, 3.01 or 3.05, or
otherwise) prior to 12:00 noon, Dallas, Texas time, on the date when due, in
immediately available funds, without set-off or counterclaim. Any amounts
received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such
payments shall be made to the Administrative Agent at its offices at ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, 9th Floor, MS46, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, except payments to be
made directly to the Issuing Bank as expressly provided herein and except
that payments pursuant to Sections 2.11, 3.01, 3.05 and 12.03 shall be made
directly to the Persons entitled thereto. The Administrative Agent shall
distribute any such payments received by it for the account of any other
Person to the appropriate recipient promptly following receipt thereof. If
any payment hereunder shall be due on a day that is not a Business Day, the
date for payment shall be extended to the next succeeding Business Day, and,
in the case of any payment accruing interest, interest thereon shall be
payable for the period of such extension. All payments hereunder shall be
made in dollars.
(b) If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal,
unreimbursed LC Disbursements, interest and fees then due hereunder, such
funds shall be applied (i) first, towards payment of interest and fees then
due hereunder, ratably among the parties entitled thereto in accordance with
the amounts of interest and fees then due to such parties, and (ii) second,
towards payment of principal and unreimbursed LC Disbursements then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of principal and unreimbursed LC Disbursements then due to such
parties.
(c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Loans or participations in LC Disbursements resulting
in such Lender receiving payment of a greater proportion of the aggregate
amount of its Loans and participations in LC Disbursements and accrued
interest thereon than the proportion received by any other Lender, then the
Lender receiving such greater proportion shall purchase (for cash at face
value) participations in the Loans and participations in LC Disbursements of
other Lenders to the extent necessary so that the benefit of all such
payments shall be shared by the Lenders ratably in accordance with the
aggregate amount of principal of and accrued interest on their respective
Loans and participations in LC Disbursements; provided that (i) if any such
participations are purchased and all or any portion of the payment giving
rise thereto is recovered, such participations shall be rescinded and the
purchase price restored to the extent of such recovery, without interest,
and (ii) the provisions of this paragraph shall not be construed to apply to
any payment made by the Borrower pursuant to and in accordance with the
express terms of this Agreement or any payment obtained by a Lender as
consideration for the assignment of or sale of a participation in any of its
Loans or participations in LC Disbursements to any assignee or participant,
other than to the Borrower or any Subsidiary or Affiliate thereof (as to
which the provisions of this paragraph shall apply). The Borrower consents
to the foregoing and agrees, to the extent it may effectively do so under
applicable law, that any Lender acquiring a participation pursuant to the
foregoing arrangements may exercise against the Borrower rights of set-off
and counterclaim with respect to such participation as fully as if such
Lender were a direct creditor of the Borrower in the amount of such
participation.
(d) Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders or the Issuing Bank
hereunder that the Borrower will not make such payment, the Administrative
Agent may assume that the Borrower has made such payment on such date in
accordance herewith and may, in reliance upon such assumption, distribute to
the Lenders or the Issuing Bank, as the case may be, the amount due. In
such event, if the Borrower has not in fact made such payment, then each of
the Lenders or the Issuing Bank, as the case may be, severally agrees to
repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender or the Issuing Bank with interest thereon, for
each day from and including the date such amount is distributed to it to but
excluding the date of payment to the Administrative Agent, at the greater of
the Federal Funds Effective Rate and a rate determined by the Administrative
Agent in accordance with banking industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to be
made by it pursuant to Section 2.04(b), 2.12(d) or 2.14(d), then the
Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender's
obligations under such Sections until all such unsatisfied obligations are
fully paid.
SECTION 2.13. Mitigation Obligations; Replacement of Lenders.
(a) If any Lender requests compensation under Section 3.01, or
if the Borrower is required to pay any additional amount to any Lender or
any Governmental Authority for the account of any Lender pursuant to
Section 2.11, then such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to
assign its rights and obligations hereunder to another of its offices,
branches or affiliates, if, in the judgment of such Lender, such designation
or assignment (i) would eliminate or reduce amounts payable pursuant to
Section 2.11 or 3.01, as the case may be, in the future and (ii) would not
subject such Lender to any unreimbursed cost or expense and would not
otherwise be disadvantageous to such Lender. The Borrower hereby agrees to
pay all reasonable costs and expenses incurred by any Lender in connection
with any such designation or assignment.
(b) If any Lender requests compensation under Section 3.01, or if
the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to
Section 2.11, or if any Lender defaults in its obligation to fund Loans
hereunder, then the Borrower may, at its sole expense and effort, upon
notice to such Lender and the Administrative Agent, require such Lender to
assign and delegate, without recourse (in accordance with and subject to the
restrictions contained in Section 12.04), all its interests, rights and
obligations under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (i) the Borrower shall have received the prior
written consent of the Administrative Agent (and if a Commitment is being
assigned, the Issuing Bank), which consent shall not unreasonably be
withheld, (ii) such Lender shall have received payment of an amount equal to
the outstanding principal of its Loans and participations in
LC Disbursements, accrued interest thereon, accrued fees and all other
amounts payable to it hereunder, from the assignee (to the extent of such
outstanding principal and accrued interest and fees) or the Borrower (in the
case of all other amounts) and (iii) in the case of any such assignment
resulting from a claim for compensation under Section 3.01 or payments
required to be made pursuant to Section 2.11, such assignment will result in
a reduction in such compensation or payments. A Lender shall not be
required to make any such assignment and delegation if, prior thereto, as a
result of a waiver by such Lender or otherwise, the circumstances entitling
the Borrower to require such assignment and delegation cease to apply.
SECTION 2.14. Letters of Credit.
(a) General. Subject to the terms and conditions set forth
herein, the Borrower may request the issuance of Letters of Credit for its
own account, in a form reasonably acceptable to the Administrative Agent and
the Issuing Bank, at any time and from time to time during the Availability
Period. In the event of any inconsistency between the terms and conditions
of this Agreement and the terms and conditions of any form of letter of
credit application or other agreement submitted by the Borrower to, or
entered into by the Borrower with, the Issuing Bank relating to any Letter
of Credit, the terms and conditions of this Agreement shall control.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions. To request the issuance of a Letter of Credit (or the
amendment, renewal or extension of an outstanding Letter of Credit), the
Borrower shall hand deliver or telecopy (or transmit by electronic
communication, if arrangements for doing so have been approved by the
Issuing Bank) to the Issuing Bank and the Administrative Agent (reasonably
in advance of the requested date of issuance, amendment, renewal or
extension) a notice requesting the issuance of a Letter of Credit, or
identifying the Letter of Credit to be amended, renewed or extended, and
specifying the date of issuance, amendment, renewal or extension (which
shall be a Business Day), the date on which such Letter of Credit is to
expire (which shall comply with paragraph (c) of this Section), the amount
of such Letter of Credit, the name and address of the beneficiary thereof
and such other information as shall be necessary to prepare, amend, renew or
extend such Letter of Credit. If requested by the Issuing Bank, the
Borrower also shall submit a letter of credit application on the Issuing
Bank's standard form in connection with any request for a Letter of Credit.
A Letter of Credit shall be issued, amended, renewed or extended only if
(and upon issuance, amendment, renewal or extension of each Letter of Credit
the Borrower shall be deemed to represent and warrant that), after giving
effect to such issuance, amendment, renewal or extension (i) the LC Exposure
shall not exceed $10,000,000.00 and (ii) the sum of the total Revolving
Credit Exposure shall not exceed the total Commitments.
(c) Expiration Date. Each Letter of Credit shall expire at or
prior to the close of business on the earlier of (i) the date one year after
the date of the issuance of such Letter of Credit (or, in the case of any
renewal or extension thereof, one year after such renewal or extension) and
(ii) the date that is five Business Days prior to the Maturity Date.
(d) Participations. By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without
any further action on the part of the Issuing Bank or the Lenders, the
Issuing Bank hereby grants to each Lender, and each Lender hereby acquires
from the Issuing Bank, a participation in such Letter of Credit equal to
such Lender's Applicable Percentage of the aggregate amount available to be
drawn under such Letter of Credit. In consideration and in furtherance of
the foregoing, each Lender hereby absolutely and unconditionally agrees to
pay to the Administrative Agent, for the account of the Issuing Bank, such
Lender's Applicable Percentage of each LC Disbursement made by the Issuing
Bank and not reimbursed by the Borrower on the date due as provided in
paragraph (e) of this Section, or of any reimbursement payment required to
be refunded to the Borrower for any reason. Each Lender acknowledges and
agrees that its obligation to acquire participations pursuant to this
paragraph in respect of Letters of Credit is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including any
amendment, renewal or extension of any Letter of Credit or the occurrence
and continuance of a Default or reduction or termination of the Commitments,
and that each such payment shall be made without any offset, abatement,
withholding or reduction whatsoever.
(e) Reimbursement. If the Issuing Bank shall make any
LC Disbursement in respect of a Letter of Credit, the Borrower shall
reimburse such LC Disbursement by paying to the Administrative Agent an
amount equal to such LC Disbursement not later than 12:00 noon, Dallas,
Texas time, on the date that such LC Disbursement is made, if the Borrower
shall have received notice of such LC Disbursement prior to 10:00 a.m.,
Dallas, Texas time, on such date, or, if such notice has not been received
by the Borrower prior to such time on such date, then not later than
12:00 noon, Dallas, Texas time, on (i) the Business Day that the Borrower
receives such notice, if such notice is received prior to 10:00 a.m.,
Dallas, Texas time, on the day of receipt, or (ii) the Business Day
immediately following the day that the Borrower receives such notice, if
such notice is not received prior to such time on the day of receipt;
provided that, if such LC Disbursement is not less than $500,000, the
Borrower may, subject to the conditions to borrowing set forth herein,
request in accordance with Section 2.03 that such payment be financed with
an ABR Borrowing in an equivalent amount and, to the extent so financed, the
Borrower's obligation to make such payment shall be discharged and replaced
by the resulting ABR Borrowing. If the Borrower fails to make such payment
when due, the Administrative Agent shall notify each Lender of the
applicable LC Disbursement, the payment then due from the Borrower in
respect thereof and such Lender's Applicable Percentage thereof. Promptly
following receipt of such notice, each Lender shall pay to the
Administrative Agent its Applicable Percentage of the payment then due from
the Borrower, in the same manner as provided in Section 2.04 with respect to
Loans made by such Lender (and Section 2.04 shall apply, mutatis mutandis,
to the payment obligations of the Lenders), and the Administrative Agent
shall promptly pay to the Issuing Bank the amounts so received by it from
the Lenders. Promptly following receipt by the Administrative Agent of any
payment from the Borrower pursuant to this paragraph, the Administrative
Agent shall distribute such payment to the Issuing Bank or, to the extent
that Lenders have made payments pursuant to this paragraph to reimburse the
Issuing Bank, then to such Lenders and the Issuing Bank as their interests
may appear. Any payment made by a Lender pursuant to this paragraph to
reimburse the Issuing Bank for any LC Disbursement (other than the funding
of ABR Loans as contemplated above) shall not constitute a Loan and shall
not relieve the Borrower of its obligation to reimburse such LC
Disbursement.
(f) Obligations Absolute. The Borrower's obligation to reimburse
LC Disbursements as provided in paragraph (e) of this Section shall be
absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability of
any Letter of Credit or this Agreement, or any term or provision therein,
(ii) any draft or other document presented under a Letter of Credit proving
to be forged, fraudulent or invalid in any respect or any statement therein
being untrue or inaccurate in any respect, (iii) payment by the Issuing Bank
under a Letter of Credit against presentation of a draft or other document
that does not comply with the terms of such Letter of Credit (subject to the
terms of this subsection), or (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but
for the provisions of this Section, constitute a legal or equitable
discharge of, or provide a right of setoff against, the Borrower's
obligations hereunder. Neither the Administrative Agent, the Lenders nor
the Issuing Bank, nor any of their Related Parties, shall have any liability
or responsibility by reason of or in connection with the issuance or
transfer of any Letter of Credit or any payment or failure to make any
payment thereunder (irrespective of any of the circumstances referred to in
the preceding sentence), or any error, omission, interruption, loss or delay
in transmission or delivery of any draft, notice or other communication
under or relating to any Letter of Credit (including any document required
to make a drawing thereunder), any error in interpretation of technical
terms or any consequence arising from causes beyond the control of the
Issuing Bank; provided that the foregoing shall not be construed to excuse
the Issuing Bank from liability to the Borrower to the extent of any direct
damages (as opposed to consequential damages, claims in respect of which are
hereby waived by the Borrower to the extent permitted by applicable law)
suffered by the Borrower that are caused by the Issuing Bank's failure to
exercise care when determining whether drafts and other documents presented
under a Letter of Credit comply with the terms thereof. The parties hereto
expressly agree that, in the absence of gross negligence or wilful
misconduct on the part of the Issuing Bank (as finally determined by a court
of competent jurisdiction), the Issuing Bank shall be deemed to have
exercised care in each such determination. In furtherance of the foregoing
and without limiting the generality thereof, the parties agree that, with
respect to documents presented which appear on their face to be in
substantial compliance with the terms of a Letter of Credit, the Issuing
Bank may, in its sole discretion, either accept and make payment upon such
documents without responsibility for further investigation, regardless of
any notice or information to the contrary, or refuse to accept and make
payment upon such documents if such documents are not in strict compliance
with the terms of such Letter of Credit. Notwithstanding anything to the
contrary contained in this subsection, the Issuing Bank shall exercise
reasonable care to determine whether drafts or other documents presented
under a Letter of Credit are in material compliance with the terms thereof.
(g) Disbursement Procedures. The Issuing Bank shall, promptly
following its receipt thereof, examine all documents purporting to represent
a demand for payment under a Letter of Credit. The Issuing Bank shall
promptly notify the Administrative Agent and the Borrower by telephone
(confirmed by telecopy) of such demand for payment and whether the Issuing
Bank has made or will make an LC Disbursement thereunder; provided that any
failure to give or delay in giving such notice shall not relieve the
Borrower of its obligation to reimburse the Issuing Bank and the Lenders
with respect to any such LC Disbursement.
(h) Interim Interest. If the Issuing Bank shall make any LC
Disbursement, then, unless the Borrower shall reimburse such LC Disbursement
in full on the date such LC Disbursement is made, the unpaid amount thereof
shall bear interest, for each day from and including the date such LC
Disbursement is made to but excluding the date that the Borrower reimburses
such LC Disbursement, at the rate per annum then applicable to ABR Loans;
provided that, if the Borrower fails to reimburse such LC Disbursement when
due pursuant to paragraph (e) of this Section, then Section 2.10(c) shall
apply. Interest accrued pursuant to this paragraph shall be for the account
of the Issuing Bank, except that interest accrued on and after the date of
payment by any Lender pursuant to paragraph (e) of this Section to reimburse
the Issuing Bank shall be for the account of such Lender to the extent of
such payment.
(i) Replacement of the Issuing Bank. The Issuing Bank may be
replaced at any time by written agreement among the Borrower, the
Administrative Agent, the replaced Issuing Bank and the successor Issuing
Bank. The Administrative Agent shall notify the Lenders of any such
replacement of the Issuing Bank. At the time any such replacement shall
become effective, the Borrower shall pay all unpaid fees accrued for the
account of the replaced Issuing Bank pursuant to Section 2.09(d). From and
after the effective date of any such replacement, (i) the successor Issuing
Bank shall have all the rights and obligations of the Issuing Bank under
this Agreement with respect to Letters of Credit to be issued thereafter and
(ii) references herein to the term "Issuing Bank" shall be deemed to refer
to such successor or to any previous Issuing Bank, or to such successor and
all previous Issuing Banks, as the context shall require. After the
replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall
remain a party hereto and shall continue to have all the rights and
obligations of an Issuing Bank under this Agreement with respect to Letters
of Credit issued by it prior to such replacement, but shall not be required
to issue additional Letters of Credit.
(j) Cash Collateralization. If any Event of Default shall occur
and be continuing, on the Business Day that the Borrower receives notice
from the Administrative Agent or the Required Lenders (or, if the maturity
of the Loans has been accelerated, Lenders with LC Exposure representing
greater than 66-2/3% of the total LC Exposure) demanding the deposit of cash
collateral pursuant to this paragraph, the Borrower shall deposit in an
account with the Administrative Agent, in the name of the Administrative
Agent and for the benefit of the Lenders, an amount in cash equal to the LC
Exposure as of such date plus any accrued and unpaid interest thereon;
provided that the obligation to deposit such cash collateral shall become
effective immediately, and such deposit shall become immediately due and
payable, without demand or other notice of any kind, upon the occurrence of
any Event of Default with respect to the Borrower described in clause (h)
or (i) of Article X. Such deposit shall be held by the Administrative Agent
as collateral for the payment and performance of the obligations of the
Borrower under this Agreement. The Administrative Agent shall have
exclusive dominion and control, including the exclusive right of withdrawal,
over such account. Other than any interest earned on the investment of such
deposits, which investments shall be made at the option and sole discretion
of the Administrative Agent and at the Borrower's risk and expense, such
deposits shall not bear interest. Interest or profits, if any, on such
investments shall accumulate in such account. Moneys in such account shall
be applied by the Administrative Agent to reimburse the Issuing Bank for LC
Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations
of the Borrower for the LC Exposure at such time or, if the maturity of the
Loans has been accelerated (but subject to the consent of Lenders with LC
Exposure representing greater than 66-2/3% of the total LC Exposure), be
applied to satisfy other obligations of the Borrower under this Agreement.
If the Borrower is required to provide an amount of cash collateral
hereunder as a result of the occurrence of an Event of Default, such amount
(to the extent not applied as aforesaid) shall be returned to the Borrower
within three Business Days after all Events of Default have been cured or
waived.
(k) Notwithstanding anything to the contrary contained in any
application for any Letter of Credit, Borrower shall not be required to
notify the Issuing Bank of any litigation threatened against the Borrower
if the Borrower is not reasonably aware of such threatened litigation.
ARTICLE III
Yield Protection and Illegality
SECTION 3.01. Increased Costs.
(a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or
for the account of, or credit extended by, any Lender (except any
such reserve requirement reflected in the Adjusted LIBO Rate) or
the Issuing Bank; or
(ii) impose on any Lender or the Issuing Bank or the London
interbank market any other condition affecting this Agreement or
Eurodollar Loans made by such Lender or any Letter of Credit or
participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or
the Issuing Bank of participating in, issuing or maintaining any Letter of
Credit or to reduce the amount of any sum received or receivable by such
Lender or the Issuing Bank hereunder (whether of principal, interest or
otherwise), then the Borrower will pay to such Lender or the Issuing Bank,
as the case may be, such additional amount or amounts as will compensate
such Lender or the Issuing Bank, as the case may be, for such additional
costs incurred or reduction suffered.
(b) If any Lender or the Issuing Bank determines that any Change
in Law regarding capital requirements has or would have the effect of
reducing the rate of return on such Lender's or the Issuing Bank's capital
or on the capital of such Lender's or the Issuing Bank's holding company, if
any, as a consequence of this Agreement or the Loans made by, or
participations in Letters of Credit held by, such Lender, or the Letters of
Credit issued by the Issuing Bank,to a level below that which such Lender or
the Issuing Bank or such Lender's or the Issuing Bank's holding company
could have achieved but for such Change in Law (taking into consideration
such Lender's or the Issuing Bank's policies and the policies of such
Lender's or the Issuing Bank's holding company with respect to capital
adequacy), then from time to time the Borrower will pay to such Lender or
the Issuing Bank, as the case may be, such additional amount or amounts as
will compensate such Lender or the Issuing Bank or such Lender's or the
Issuing Bank's holding company for any such reduction suffered.
(c) A certificate of a Lender or the Issuing Bank setting forth
the amount or amounts necessary to compensate such Lender or the Issuing
Bank, or its holding company, as the case may be, as specified in
paragraph (a) or (b) of this Section shall be delivered to the Borrower and
shall be conclusive absent manifest error. The Borrower shall pay such
Lender or the Issuing Bank, as the case may be, the amount shown as due on
any such certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender or the Issuing Bank
to demand compensation pursuant to this Section shall not constitute a
waiver of such Lender's or the Issuing Bank's right to demand such
compensation; provided that the Borrower shall not be required to compensate
a Lender or the Issuing Bank pursuant to this Section for any increased
costs or reductions incurred more than 270 days prior to the date that such
Lender or the Issuing Bank, as the case may be, notifies the Borrower of the
Change in Law giving rise to such increased costs or reductions and of such
Lender's or the Issuing Bank's intention to claim compensation therefor;
provided further that, if the Change in Law giving rise to such increased
costs or reductions is retroactive, then the 270-day period referred to
above shall be extended to include the period of retroactive effect thereof.
SECTION 3.02. Alternate Rate of Interest. If prior to the commencement of
any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which determination shall
be conclusive absent manifest error) that adequate and reasonable means do
not exist for ascertaining the Adjusted LIBO Rate or the LIBO Rate, as
applicable, for such Interest Period; or
(b) the Administrative Agent is advised by the Required Lenders
that the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such
Interest Period will not adequately and fairly reflect the cost to such
Lenders (or Lender) of making or maintaining their Loans (or its Loan)
included in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and
the Lenders by telephone or telecopy as promptly as practicable thereafter
and, until the Administrative Agent notifies the Borrower and the Lenders
that the circumstances giving rise to such notice no longer exist, (i) any
Interest Election Request that requests the conversion of any Borrowing to,
or continuation of any Borrowing as, a Eurodollar Borrowing shall be
ineffective and (ii) if any Borrowing Request requests a Eurodollar
Borrowing, such Borrowing shall be made as an ABR Borrowing.
SECTION 3.03. Illegality.
Notwithstanding any other provision of this Agreement,
in the event that it becomes unlawful for any Lender or its applicable
lending office to (a) honor its obligation to make Eurodollar Borrowings
hereunder or (b) maintain Eurodollar Borrowings hereunder, then such Lender
shall promptly notify the Borrower (with a copy to the Administrative Agent)
thereof and such Lender's obligation to make or maintain Eurodollar
Borrowings and to convert other Types of Borrowings into Eurodollar
Borrowings hereunder shall be suspended until such time as such Lender may
again make and maintain Eurodollar Borrowings, in which case (i) all
Borrowings which would be otherwise made by such Lender as Eurodollar
Borrowings shall be made instead as ABR Borrowings and all Borrowings which
would otherwise be converted into (or continued as) Eurodollar Borrowings
shall be converted instead into (or shall remain as) ABR Borrowings and
(ii) if such Lender so requests by notice to the Borrower (with a copy to
the Administrative Agent), all Eurodollar Borrowings of such Lender shall be
automatically converted into ABR Borrowings on the date specified by such
Lender in such notice.
SECTION 3.04. Treatment of Affected Borrowings. If the Eurodollar Borrowings
of any Lender are to be converted pursuant to Section 3.03 hereof, such
Lender's Eurodollar Borrowings shall be automatically converted into ABR
Borrowings on the last day(s) of the then current Interest Period(s) for
such Eurodollar Borrowings (or on such earlier date as such Lender may
specify to the Borrower with a copy to the Administrative Agent) and, unless
and until such Lender gives notice as provided below that the circumstances
specified in Section 3.03 hereof which gave rise to such conversion no
longer exist:
(a) To the extent that such Lender's Eurodollar Borrowings have
been so converted, all payments and prepayments of principal which would
otherwise be applied to such Lender's Eurodollar Borrowings shall be applied
instead to its ABR Borrowings;
(b) All Borrowings which would otherwise be made or continued by
such Lender as Eurodollar Borrowings shall be made as or converted into ABR
Borrowings and all Borrowings of such Lender which would otherwise be
converted into Eurodollar Borrowings shall be converted instead into (or
shall remain as) ABR Borrowings; and
If such Lender gives notice to the Borrower (with a copy to the
Administrative Agent) that the circumstances specified in Section 3.03
hereof which gave rise to the conversion of such Lender's Eurodollar
Borrowings pursuant to this Section 3.04 no longer exist (which such Lender
agrees to do promptly upon such circumstances ceasing to exist) at a time
when Eurodollar Borrowings are outstanding, such Lender's ABR Borrowings
shall be automatically converted, on the first day(s) of the next succeeding
Interest Period(s) for such outstanding Eurodollar Borrowings to the extent
necessary so that, after giving effect thereto, all Borrowings held by the
Lenders holding Eurodollar Borrowings and by such Lender are held pro rata
(as to principal amounts, Types, and Interest Periods) in accordance with
their respective Commitments.
SECTION 3.05. Break Funding Payments. In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default),
(b) the conversion of any Eurodollar Loan other than on the last day of the
Interest Period applicable thereto, (c) the failure to borrow, convert,
continue or prepay any Loan on the date specified in any notice delivered
pursuant hereto (regardless of whether such notice may be revoked under
Section 2.08(b) and is revoked in accordance therewith), or (d) the
assignment of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto as a result of a request by the Borrower pursuant
to Section 2.13, then, in any such event, the Borrower shall compensate each
Lender for the loss, cost and expense attributable to such event. In the
case of a Eurodollar Loan, such loss, cost or expense to any Lender shall be
deemed to include an amount determined by such Lender to be the excess, if
any, of (i) the amount of interest which would have accrued on the principal
amount of such Loan had such event not occurred, at the Adjusted LIBO Rate
that would have been applicable to such Loan, for the period from the date
of such event to the last day of the then current Interest Period therefor
(or, in the case of a failure to borrow, convert or continue, for the period
that would have been the Interest Period for such Loan), over (ii) the
amount of interest which would accrue on such principal amount for such
period at the interest rate which such Lender would bid were it to bid, at
the commencement of such period, for dollar deposits of a comparable amount
and period from other banks in the eurodollar market. A certificate of any
Lender setting forth any amount or amounts that such Lender is entitled to
receive pursuant to this Section shall be delivered to the Borrower and
shall be conclusive absent manifest error. The Borrower shall pay such
Lender the amount shown as due on any such certificate within 10 days after
receipt thereof.
ARTICLE IV
Security
SECTION 4.01 Collateral. To secure full and complete payment and performance
of the Obligations, the Borrower shall execute and deliver or cause to be
executed and delivered the documents described below covering the property
and collateral described in this Section 4.01 (which, together with any
other property and collateral which may now or hereafter secure the
Obligations or any part thereof, is sometimes herein called the
"Collateral"):
(a) The Borrower will, and will cause each of the Guarantors to,
grant to the Administrative Agent, for the benefit of the Administrative
Agent, the Issuing Bank and the Lenders, a first priority security interest
in all of its accounts, accounts receivable, equipment, machinery,
furniture, fixtures, inventory, chattel paper, documents, instruments,
general intangibles, investment property, intellectual property, and Equity
Interests in its Subsidiaries, whether now owned or hereafter acquired, and
all products and proceeds thereof, pursuant to the Security Agreement;
provided that not more than 65% of the Equity Interests of any Foreign
Subsidiary shall be required to be subject to such security interest.
(b) The Borrower will, and will cause each of its Subsidiaries to,
execute and cause to be executed such further documents and instruments,
including without limitation, Uniform Commercial Code financing statements,
as the Administrative Agent, in its sole discretion, deems necessary or
desirable to evidence and perfect its Liens in the Collateral.
ARTICLE V
Representations and Warranties
The Borrower represents and warrants to the Administrative Agent and
the Lenders that:
SECTION 5.01. Organization; Powers.
Each of the Borrower and its Subsidiaries
is duly organized, validly existing and in good standing under the laws of
the jurisdiction of its organization, has all requisite power and authority
to carry on its business as now conducted and, except where the failure to
do so, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect, is qualified to do business in, and is
in good standing in, every jurisdiction where because of the nature of its
activities or properties such qualification is required.
SECTION 5.02. Authorization; Enforceability. The Transactions and the
Acquisition of the Company are within the powers of the Borrower and the
Subsidiaries, respectively, and have been duly authorized by all necessary
action. This Agreement and the other Loan Documents to which Borrower or
any Guarantor is a party have been duly executed and delivered by such
Person and constitutes a legal, valid and binding obligation of such Person,
enforceable in accordance with their respective terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other laws affecting
creditors' rights generally and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law. The
Acquisition of the Company is within the Company's corporate powers and has
been duly authorized by all necessary action.
SECTION 5.03. Governmental Approvals; No Conflicts. Neither the Transactions
nor the Acquisition of the Company (a) require any consent or approval of,
registration or filing with, or any other action by, any Governmental
Authority, except such as have been obtained or made and are in full force
and effect or failure to do so would not have a Material Adverse Effect,
(b) will violate any applicable law or regulation or the charter, by-laws or
other organizational documents of the Borrower or any of its Subsidiaries or
any order of any Governmental Authority, other than any violation that would
not have a Material Adverse Effect, (c) will violate or result in a default
under any indenture, agreement or other instrument binding upon the Borrower
or any of its Subsidiaries, or their respective assets, or give rise to a
right thereunder to require any payment to be made by the Borrower or any of
its Subsidiaries, other than any violation that would not have a Material
Adverse Effect, and (d) will result in the creation or imposition of any
Lien on any asset of the Borrower or any of its Subsidiaries, other than
Liens created or imposed by the Transactions.
SECTION 5.04. Financial Condition; No Material Adverse Change.
(a) The Borrower has heretofore furnished to the Lenders its
consolidated balance sheet and statements of income, stockholders' equity
and cash flows as of and for the fiscal years ended December 31, 1997,
December 31, 1998 and December 31, 1999, reported on by
PricewaterhouseCoopers LLP, independent public accountants. Such financial
statements present fairly, in all material respects, the financial position
and results of operations and cash flows of the Borrower and its
consolidated Subsidiaries as of such dates and for such periods in
accordance with GAAP.
(b) Since December 31, 1998, there has been no material adverse
change in the business, assets, operations or condition, financial or
otherwise, of the Borrower and its Subsidiaries, taken as a whole.
(c) The Company has heretofore furnished to the Lenders its
consolidated balance sheet and statements of income, stockholders' equity
and cash flows (i) as of and for the fiscal years ended December 31, 1997
and December 31, 1998, reported on by Deloitte & Touche LLP, independent
public accountants and (ii) as of and for the fiscal year ended December 31,
1999, certified by its chief financial officer. Such financial statements
present fairly, in all material respects, the financial position and results
of operations and cash flows of the Company and its consolidated
subsidiaries as of such dates and for such periods in accordance with GAAP,
subject to year-end audit adjustments and the absence of footnotes in the
case of the statements referred to in clause (ii) above.
(d) Since December 31, 1998, there has been no material adverse
change in the business, assets, operations or condition, financial or
otherwise, of the Company and its subsidiaries, taken as a whole.
(e) Except as disclosed in the financial statements referred to
above or the notes thereto and except for Disclosed Matters, after giving
effect to the Transactions and the Acquisition of the Company, none of the
Borrower or its Subsidiaries has, as of the Effective Date, any material
contingent liabilities, unusual long term commitments or unrealized losses.
SECTION 5.05. Properties.
(a) Each of the Borrower and its Subsidiaries has good title to,
or valid leasehold interests in, all its real and personal property material
to its business, except for minor defects in title that do not interfere
with its ability to conduct its business as currently conducted or to
utilize such properties for their intended purposes, and none of the
properties, assets or leasehold interests of the Borrower or any Subsidiary
is subject to any Lien, except as permitted by Section 8.02.
(b) Each of the Borrower and its Subsidiaries owns, or is licensed
to use, all trademarks, tradenames, copyrights, patents and other
intellectual property material to its business, and the use thereof by the
Borrower and its Subsidiaries does not infringe upon the rights of any other
Person, except for any such infringements that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.
SECTION 5.06. Litigation and Environmental Matters.
(a) There are no actions, suits or proceedings by or before any
arbitrator or Governmental Authority pending against or, to the knowledge of
the Borrower, threatened against or affecting the Borrower or any of its
Subsidiaries (i) as to which there is a reasonable possibility of an adverse
determination and that, if adversely determined, could reasonably be
expected, individually or in the aggregate, to result in a Material Adverse
Effect (other than the Disclosed Matters) or (ii) that involve this
Agreement, any of the other Loan Documents, the Acquisition of the Company
or the Transactions.
(b) Except for the Disclosed Matters and except with respect to
any other matters that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, neither the
Borrower nor any of its Subsidiaries (i) has failed to comply with any
Environmental Law or to obtain, maintain or comply with any permit, license
or other approval required under any Environmental Law, (ii) has become
subject to any Environmental Liability, (iii) has received notice of any
claim with respect to any Environmental Liability or (iv) knows of any basis
for any Environmental Liability.
(c) Since the date of this Agreement, there has been no change in
the status of the Disclosed Matters that, individually or in the aggregate,
has resulted in, or materially increased the likelihood of, a Material
Adverse Effect.
SECTION 5.07. Compliance with Laws and Agreements.
Each of the Borrower and its
Subsidiaries is in compliance with all laws, regulations and orders of any
Governmental Authority applicable to it or its property and all indentures,
agreements and other instruments binding upon it or its property, except
where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect. No Default
has occurred and is continuing.
SECTION 5.08 Investment and Holding Company Status. Neither the Borrower nor
any of its Subsidiaries is (a) an "investment company" as defined in, or
subject to regulation under, the Investment Company Act of 1940 or (b) a
"holding company" as defined in, or subject to regulation under, the Public
Utility Holding Company Act of 1935.
SECTION 5.09. Taxes.
Each of the Borrower and its Subsidiaries has timely filed
or caused to be filed all Tax returns and reports required to have been
filed and has paid or caused to be paid all Taxes required to have been paid
by it, except (a) Taxes that are being contested in good faith by
appropriate proceedings and for which the Borrower or such Subsidiary, as
applicable, has set aside on its books adequate reserves or (b) to the
extent that the failure to do so could not reasonably be expected to result
in a Material Adverse Effect.
SECTION 5.10. ERISA. No ERISA Event has occurred or is reasonably expected
to occur that when taken together with all other such ERISA Events for which
liability is reasonably expected to occur, could reasonably be expected to
result in a Material Adverse Effect. The present value of all accumulated
benefit obligations under each Plan (based on the assumptions used for
purposes of Statement of Financial Accounting Standards No. 87) did not, as
of the date of the most recent financial statements reflecting such amounts,
exceed by more than $1,000,000 the fair market value of the assets of such
Plan, and the present value of all accumulated benefit obligations of all
underfunded Plans (based on the assumptions used for purposes of Statement
of Financial Accounting Standards No. 87) did not, as of the date of the
most recent financial statements reflecting such amounts, exceed by more
than $1,000,000 the fair market value of the assets of all such underfunded
Plans.
SECTION 5.11. Disclosure. The Borrower has disclosed to the Lenders all
agreements, instruments and corporate or other restrictions to which it, any
of its Subsidiaries is subject, and all other matters known to it, that,
individually or in the aggregate, could reasonably be expected to result in
a Material Adverse Effect. None of the reports, financial statements,
certificates or other information furnished by or on behalf of the Borrower
to the Administrative Agent or any Lender in connection with the negotiation
of this Agreement or delivered hereunder (as modified or supplemented by
other information so furnished) contains any material misstatement of fact
or omits to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided that, with respect to projected financial information,
the Borrower represents only that such information was prepared in good
faith based upon assumptions believed to be reasonable at the time.
SECTION 5.12. Year 2000. The Year 2000 date change has not resulted in
disruption of the Borrower's and its Subsidiaries' computer hardware,
software, databases, systems and other equipment containing embedded
microchips (including systems and equipment supplied by others or with which
the Borrower's or its Subsidiaries' systems interface), or to the Borrower's
or its Subsidiaries' operations or business systems, or to the best of the
Borrower's or its Subsidiaries' knowledge, to the operations or business
systems of the Borrower's major vendors, customers, suppliers and
counterparties. Borrower has no reason to believe that liabilities and
expenditures related to the Year 2000 date-change (including, without
limitation, costs caused by reprogramming errors, the failure of others'
systems or equipment, and the potential liability, if any, of the Borrower
or its Subsidiaries for Year 2000 related costs incurred or disruption
experienced by others) will result in a Default or a Material Adverse
Effect.
SECTION 5.13. Indebtedness. The Borrower and its Subsidiaries have no
Indebtedness, except as disclosed on Schedule 8.01 or otherwise permitted by
Section 8.01.
SECTION 5.14. Subsidiaries. The Borrower has no Subsidiaries other than
those listed on Schedule 5.14 hereto, and Schedule 5.14 sets forth the
jurisdiction of organization of each Subsidiary and the percentage of the
Borrower's or any Subsidiary's ownership of the outstanding voting stock or
other ownership or Equity Interests of each Subsidiary and designates the
Subsidiaries as of the Effective Date. All of the outstanding Equity
Interests of each Subsidiary have been validly issued, is fully paid, and is
nonassessable. The Borrower shall, from time to time as necessary, deliver
to the Administrative Agent an updated Schedule 5.14 to this Agreement,
together with a certificate of an authorized officer of the Borrower
certifying that the information set forth in such schedule is true, correct
and complete as of such date.
SECTION 5.15. Inventory.
All inventory of the Borrower and its Subsidiaries has
been and will hereafter be produced in compliance with all applicable laws,
rules, regulations, and governmental standards, including, without
limitation, the minimum wage and overtime provisions of the Fair Labor
Standards Act, as amended (29 U.S.C. SS 201-219), and the regulations
promulgated thereunder, except any noncompliance that does not have a
Material Adverse Effect.
SECTION 5.16. Patents, Trademarks and Copyrights. Schedule 5.16 sets forth
a true, accurate and complete listing as of the date hereof, of all patents,
trademarks and copyrights, and applications therefor, of the Borrower and
its Subsidiaries. Except as created or permitted under the Loan Documents,
no Lien exists with respect to the interests of the Borrower or any
Subsidiary in any such patents, trademarks, copyrights or applications, and
neither the Borrower nor any Subsidiary has transferred or subordinated any
interest it may have in such patents, trademarks, copyrights and
applications. The Borrower shall, from time to time as necessary, deliver
to the Administrative Agent an updated Schedule 5.16 to this Agreement,
together with a certificate of an authorized officer of the Borrower
certifying that the information set forth on such schedule is true, correct
and complete as of such date. Upon the request of the Administrative Agent
at any time, the Borrower shall execute and deliver and cause to be executed
and delivered assignments of all patents, trademarks, copyrights and
applications therefor included in the Collateral, in favor of the
Administrative Agent for the benefit of the Administrative Agent and the
Lenders, which assignments shall be in form and substance satisfactory to
the Administrative Agent and in proper form (i) for recording in the U.S.
Patent and Trademark Office to properly reflect the Administrative Agent's
security interest in all U.S. patents, trademarks and applications therefor
included in the Collateral and (ii) for recording with the U.S. Library of
Congress to properly reflect the Administrative Agent's security interest in
all U.S. copyrights and applications therefor included in the Collateral.
SECTION 5.17. Margin Securities. Neither the Borrower nor any of its
Subsidiaries is engaged principally, or as one of its important activities,
in the business of extending credit for the purpose of purchasing or
carrying any "margin stock" within the meaning of Regulation T, U or X of
the Board, as amended. No part of the proceeds of any Borrowing will be
used, directly or indirectly, to purchase or carry any margin stock or to
extend credit to others for the purpose of purchasing or carrying margin
stock.
SECTION 5.18. Labor Matters. Except for any of the following that would not
have a Material Adverse Effect, (a) there are no actual or threatened
strikes, labor disputes, slow downs, walkouts, work stoppages, or other
concerted interruptions of operations that involve any employees employed at
any time in connection with the business activities or operations at any of
the Borrower's or its Subsidiaries' locations, (b) hours worked by and
payment made to the employees of the Borrower or its Subsidiaries have not
been in violation of the Fair Labor Standards Act or any other applicable
laws, rules and regulations pertaining to labor matters, (c) all payments
due from the Borrower or its Subsidiaries for employee health and welfare
insurance, including, without limitation, workers' compensation insurance,
have been paid or accrued as a liability on its books, (d) the business
activities and operations of the Borrower and its Subsidiaries are in
compliance with the Occupational Safety and Health Act of 1970, 29 U.S.C. S
651 et seq. and other applicable health and safety laws, rules and
regulations.
SECTION 5.19. Solvency. On the Effective Date and on the date of each
Borrowing, the Borrower and each of its Subsidiaries are, and after giving
effect to the Transactions, the Acquisition of the Company and the requested
Borrowing, will be, Solvent.
SECTION 5.20. Burdensome Agreements. Neither the Borrower nor any of its
Subsidiaries are a party to any agreements which contain any unusual or
burdensome provisions which are reasonably likely to result in a Material
Adverse Effect.
ARTICLE VI
Conditions
SECTION 6.01. Effective Date. The obligations of the Lenders to make Loans
hereunder shall not become effective until the date on which the
Administrative Agent (or its counsel) has received (or waived in accordance
with Section 12.02) each of the following, in form and substance
satisfactory to the Administrative Agent:
(a) Credit Agreement. Either (i) a counterpart of this Agreement
signed on behalf of each party hereto or (ii) written evidence satisfactory
to the Administrative Agent (which may include telecopy transmission of a
signed signature page of this Agreement) that such party has signed a
counterpart of this Agreement.
(b) Resolutions. Such documents and certificates as the
Administrative Agent or its counsel may reasonably request relating to the
organization, existence and good standing of the Borrower and its
Subsidiaries (including the Company and its subsidiaries), the authorization
of the Transactions, and any other legal matters relating to the Borrower,
its Subsidiaries, the Company or its subsidiaries, the Loan Documents or the
Transactions, all in form and substance satisfactory to the Administrative
Agent and its counsel.
(c) Corporate Structure. Evidence of the Borrower's corporate and
subsidiary structure, which evidence and structure shall be satisfactory to
the Administrative Agent in its reasonable judgment.
(d) Governmental and Third Party Approvals. All governmental and
third-party approvals necessary or advisable, in the reasonable judgment of
the Administrative Agent, in connection with the Loans and in connection
with the continuing operations of each of the Borrower, its Subsidiaries and
the Company.
(e) Financial Statements. The financial statements specified in
Section 5.04, which shall be satisfactory to the Administrative Agent in its
reasonable judgment.
(f) Reports and Opinions. An independent auditor's most recent
management letter and unqualified report and opinion on the Borrower's
financial statements.
(g) Notes. The Notes executed by the Borrower.
(h) Security Agreement. The Security Agreement executed by the
Borrower and the Guarantors.
(i) Financing Statements. Uniform Commercial Code financing
statements executed by the Borrower and the Guarantors and covering the
Collateral.
(j) Equity Interests. The original certificates representing the
Equity Interests included in the Collateral, together with transfer powers
duly executed in blank by the Borrower.
(k) Instruments and Chattel Paper. The originals of any and all
instruments and chattel paper included in the Collateral, including without
limitation, all promissory notes evidencing all intercompany Indebtedness
owed to Borrower or any Guarantor by Borrower or any Subsidiary, each
endorsed to the order of the Administrative Agent.
(l) Intellectual Property Documentation. Documentation
satisfactory to the Administrative Agent, executed by the appropriate
parties, (i) for recording in the U.S. Patent and Trademark Office to
properly reflect the Administrative Agent's security interest in all U.S.
patents, trademarks and applications therefor of the Borrower and the
Guarantors, and (ii) for recording with the United States Library of
Congress to properly reflect the Administrative Agent's security interest in
all U.S. copyrights and applications therefor of the Borrower and the
Guarantors.
(m) Guaranty. The Guaranty executed by each Guarantor.
(n) Contribution and Indemnification Agreement. The Contribution
and Indemnification Agreement executed by the Borrower and each Guarantor.
(o) Landlord and Mortgagee Waivers or Subordinations. Landlord
and mortgagee waivers or subordinations in form and substance satisfactory
to the Administrative Agent executed by each landlord and mortgagee of any
real property located in the United States where any of the Collateral is
located, as well as any other agreements of third parties in possession of
any of the Collateral as the Administrative Agent may reasonably require.
(p) Insurance Policies. Certificate(s) of insurance evidencing
all insurance policies required by Section 7.07, together with loss payable
endorsements (where applicable) in favor of the Administrative Agent, for
the benefit of the Administrative Agent and the Lenders, with respect to
all insurance policies covering Collateral.
(q) Lien Searches. The results of UCC, tax and judgment lien
searches showing all financing statements, other documents or instruments
and tax and judgment liens on file against each of the Borrower, the
Subsidiaries and the Company in such jurisdictions as the Administrative
Agent may require, such searches to be as of a date no more than ten (10)
days prior to the Effective Date.
(r) Opinion of Counsel. A favorable written opinion (addressed to
the Administrative Agent and the Lenders and dated the Effective Date) of
▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇, counsel for the Borrower and the Subsidiaries, in
form and substance satisfactory to the Administrative Agent, as to the
matters specified on Exhibit "F" hereto and such other matters relating to
the Borrower, this Agreement, the other Loan Documents or the Transactions
as the Administrative Agent shall reasonably request, provided that opinions
regarding matters relating to the Company and its Subsidiaries shall be
given by ▇▇▇ ▇▇▇▇▇, in house counsel for the Borrower and the Subsidiaries
pursuant to a favorable written opinion in form and substance satisfactory
to the Administrative Agent. The Borrower hereby requests such counsel to
deliver such opinions.
(s) Indebtedness. All terms of the Material Indebtedness of the
Borrower, its Subsidiaries, and the Company, which shall be satisfactory to
the Lenders, and all requisite consents, approvals and amendments relating
to such Material Indebtedness, which shall be in form and substance
satisfactory to the Administrative Agent.
(t) Compliance Certificate. An initial Compliance Certificate,
dated the Effective Date and signed by a Financial Officer of the Borrower,
confirming compliance with the conditions set forth in paragraphs (a), (b)
and (c) of Section 6.02 and showing compliance as of December 31, 1999 with
the financial covenants set forth in Article IX, on a pro forma basis as
though the Acquisition of the Company has been completed.
(u) Solvency Certificates. Certificates, dated the Effective Date
and signed by a Financial Officer of the Borrower, each of the Subsidiaries,
and the Company, certifying as to the Solvency of the Borrower, each of the
Subsidiaries and the Company as of the Effective Date and after giving
effect to the Transactions and the Acquisition of the Company.
(v) Fees and Expenses. All fees and other amounts due and payable
on or prior to the Effective Date, including to the extent invoiced,
reimbursement or payment of all reasonable attorneys' fees and out-of-pocket
expenses required to be reimbursed or paid by the Borrower hereunder.
(w) Acquisition Documents. Copies of the Acquisition Documents
and all certificates, opinions and other documents delivered thereunder,
certified by a Financial Officer as complete and correct, and all consents
and approvals required to be obtained from any Governmental Authority or
other Person in connection with the Acquisition. All applicable waiting
periods and appeal periods shall have expired, in each case without the
imposition of any burdensome conditions. The Acquisition shall have been,
or substantially simultaneously with the initial funding of Loans on the
Effective Date shall be, consummated in accordance with the Acquisition
Documents and applicable law, without any amendment to or waiver of any
material terms or conditions of the Acquisition Documents not approved by
the Required Lenders.
(x) Liens. All existing Liens on any assets of the Borrower and
its Subsidiaries, and of the Company and its subsidiaries, including,
without limitation, Liens of Imperial Bank, shall be terminated and/or
released.
(y) Additional Documentation. Such additional documents and
certificates as the Administrative Agent or its counsel may reasonably
request relating to the organization, existence and good standing of each of
the Borrower, the Subsidiaries, and the Company, the authorization of the
Transactions and the Acquisition of the Company, and any other legal matters
relating to the Borrower, the Subsidiaries, the Company, this Agreement, the
Acquisition of the Company, or the Transactions, all in form and substance
satisfactory to the Administrative Agent and its counsel.
The Administrative Agent shall notify the Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding.
SECTION 6.02 Each Credit Event. The obligation of each Lender to make a Loan
on the occasion of any Borrowing, and of the Issuing Bank to issue, amend,
renew or extend any Letter of Credit, is subject to the satisfaction of the
following conditions:
(a) Representations and Warranties. The representations and
warranties of the Borrower set forth in this Agreement and the other Loan
Documents shall be true and correct on and as of the date of such Borrowing
or the date of issuance, amendment, renewal or extension of such Letter of
Credit, as applicable.
(b) No Default. At the time of and immediately after giving
effect to such Borrowing or the date of issuance, amendment, renewal or
extension of such Letter of Credit, as applicable, no Default shall have
occurred and be continuing.
(c) Material Adverse Effect. No event, development or
circumstance has occurred or exists that has had or could reasonably be
expected to have a Material Adverse Effect.
(d) Borrowing Request Form. With respect to any Borrowing, the
Administrative Agent shall have received, in accordance with Section 2.03, a
Borrowing Request Form, dated the date of such Borrowing, executed by an
authorized officer of the Borrower.
(e) Additional Documentation. The Administrative Agent shall have
received such additional approvals, opinions, or documents as the
Administrative Agent or its legal counsel may reasonably request.
(f) Each Borrowing and each issuance, amendment, renewal or
extension of such Letter of Credit shall be deemed to constitute a
representation and warranty by the Borrower on the date thereof as to the
matters specified in paragraphs (a), (b) and (c) of this Section.
ARTICLE VII
Affirmative Covenants
Until the Commitments have expired or been terminated and the principal
of and interest on each Loan and all fees payable hereunder shall have been
paid in full, and all Letters of Credit shall have expired or terminated and
all LC Disbursements shall have been reimbursed, the Borrower covenants and
agrees with the Administrative Agent and the Lenders that:
SECTION 7.01. Financial Statements and Other Information. The Borrower
will furnish to the Administrative Agent and each Lender:
(a) within 90 days after the end of each fiscal year of the
Borrower, its audited consolidated balance sheet and related statements of
operations, stockholders' equity and cash flows as of the end of and for
such year, setting forth in each case in comparative form the figures for
the previous fiscal year, all reported on by PricewaterhouseCoopers LLP or
other independent public accountants of recognized national standing
(without a "going concern" or like qualification or exception and without
any qualification or exception as to the scope of such audit) to the effect
that such consolidated financial statements present fairly in all material
respects the financial condition and results of operations of the Borrower
and its consolidated Subsidiaries on a consolidated basis in accordance with
GAAP consistently applied;
(b) within 45 days after the end of each of the first three fiscal
quarters of each fiscal year of the Borrower, its consolidated balance sheet
and related statements of operations, stockholders' equity and cash flows as
of the end of and for such fiscal quarter and the then elapsed portion of
the fiscal year, setting forth in each case in comparative form the figures
for the corresponding period or periods of (or, in the case of the balance
sheet, as of the end of) the previous fiscal year, all certified by one of
its Financial Officers as presenting fairly in all material respects the
financial condition and results of operations of the Borrower and its
consolidated Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied, subject to normal year-end audit adjustments and the
absence of footnotes;
(c) concurrently with any delivery of financial statements under
clause (a) or (b) above, a Compliance Certificate of a Financial Officer of
the Borrower (i) certifying as to whether a Default has occurred and, if a
Default has occurred, specifying the details thereof and any action taken or
proposed to be taken with respect thereto, (ii) setting forth reasonably
detailed calculations demonstrating compliance with the financial covenants
set forth herein and (iii) stating whether any change in GAAP or in the
application thereof has occurred since the date of the audited financial
statements referred to in Section 5.04 and, if any such change has occurred,
specifying the effect of such change on the financial statements
accompanying such certificate;
(d) concurrently with any delivery of financial statements under
clause (a) above, a certificate of the accounting firm that reported on such
financial statements stating whether they obtained knowledge during the
course of their examination of such financial statements of any Default
(which certificate may be limited to the extent required by accounting rules
or guidelines);
(e) promptly after the same become publicly available, copies of
all periodic and other reports, proxy statements and other materials filed
by the Borrower or any Subsidiary with the Securities and Exchange
Commission, or any Governmental Authority succeeding to any or all of the
functions of said Commission, or with any national securities exchange, or
distributed by the Borrower to its shareholders generally, as the case may
be; and
(f) promptly following any request therefor, such projections,
budgets and other information regarding the operations, business affairs and
financial condition of the Borrower or any Subsidiary, or compliance with
the terms of this Agreement and the other Loan Documents, as the
Administrative Agent may reasonably request.
SECTION 7.02. Notices of Material Events. The Borrower will furnish to the
Administrative Agent and each Lender prompt written notice of the following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or proceeding
by or before any arbitrator or Governmental Authority against or affecting
the Borrower or any Affiliate thereof that, if adversely determined, could
reasonably be expected to result in a Material Adverse Effect;
(c) the occurrence of any ERISA Event that, alone or together with
any other ERISA Events that have occurred, could reasonably be expected to
result in liability of the Borrower and its Subsidiaries in an aggregate
amount exceeding $1,000,000; and
(d) any other development that results in, or could reasonably be
expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a statement
of a Financial Officer or other executive officer of the Borrower setting
forth the details of the event or development requiring such notice and any
action taken or proposed to be taken with respect thereto.
SECTION 7.03. Existence; Conduct of Business.
The Borrower will, and will cause
each of its Subsidiaries to, do or cause to be done all things necessary to
preserve, renew and keep in full force and effect its legal existence and
the rights, licenses, permits, privileges, agreements and franchises
material to the conduct of its business; provided that the foregoing shall
not prohibit any merger, consolidation, liquidation or dissolution permitted
under Section 8.03.
SECTION 7.04. Payment of Obligations.
The Borrower will, and will cause each of
its Subsidiaries to, pay its obligations, including Tax liabilities, that,
if not paid, could result in a Material Adverse Effect or become a Lien on
any of its property, before the same shall become delinquent or in default,
except where (a) the validity or amount thereof is being contested in good
faith by appropriate proceedings, (b) the Borrower or such Subsidiary has
set aside on its books adequate reserves with respect thereto in accordance
with GAAP and (c) the failure to make payment pending such contest could not
reasonably be expected to result in a Material Adverse Effect.
SECTION 7.05. Maintenance of Properties.
The Borrower will, and will cause each
of its Subsidiaries to keep, maintain and preserve all property (tangible
and intangible) material to the conduct of its business in good working
order and condition, ordinary wear and tear excepted.
SECTION 7.06. Books and Records; Inspection Rights.
The Borrower will, and will
cause each of its Subsidiaries to, keep proper books of record and account
in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities. The Borrower will,
and will cause each of its Subsidiaries to, permit any representatives
designated by the Administrative Agent or any Lender, upon reasonable prior
notice, to visit and inspect its properties, to examine and make extracts
from its books and records, and to discuss its affairs, finances and
condition with its officers and independent accountants, all at such
reasonable times and as often as reasonably requested.
SECTION 7.07. Insurance.
The Borrower will maintain, and will cause each of the
Subsidiaries to maintain, insurance with financially sound and reputable
insurance companies in such amounts and covering such risks as is usually
carried by corporations engaged in similar businesses and owning similar
properties in the same general areas in which the Borrower and the
Subsidiaries operate, provided that in any event the Borrower will maintain
and cause each Subsidiary to maintain workers' compensation insurance,
property insurance, comprehensive general liability insurance, products
liability insurance, and business interruption insurance reasonably
satisfactory to the Lenders. Each property insurance policy covering
Collateral shall name the Administrative Agent as loss payee for the benefit
of the Lenders and shall provide that such policy will not be canceled or
reduced without thirty (30) days' prior written notice to the Administrative
Agent.
SECTION 7.08. Compliance with Laws.
The Borrower will, and will cause each of
its Subsidiaries to, and with respect to ERISA will cause each of its ERISA
Affiliates to, comply with all laws, rules, regulations and orders of any
Governmental Authority applicable to it or its property, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.
SECTION 7.09. Use of Proceeds.
The proceeds of the Loans will be used only for
general corporate purposes of the Borrower and its Subsidiaries, including
the refinancing of the Indebtedness of the Company in connection with the
Acquisition of the Company and other Acquisitions permitted by this
Agreement. No part of the proceeds of any Loan will be used, whether
directly or indirectly, for any purpose that entails a violation of any of
the Regulations of the Board, including Regulations T, U and X. Letters of
Credit will be issued only to support general corporate purposes of the
Borrower and its Subsidiaries.
SECTION 7.10. Compliance with Agreements.
The Borrower will comply, and will
cause each Subsidiary to comply, in all material respects with all
agreements, contracts, and instruments binding on it or affecting its
properties or business.
SECTION 7.11. Additional Subsidiaries.
If any additional Subsidiary is formed
or acquired after the Effective Date, the Borrower will notify the
Administrative Agent and the Lenders thereof and (a) the Borrower will cause
such Subsidiary (except any Foreign Subsidiary) to become a Guarantor within
three Business Days after such Subsidiary is formed or acquired and promptly
take such actions to create and perfect Liens on such Subsidiary's assets to
secure the Obligations as the Administrative Agent or the Required Lenders
shall reasonably request and (b) if any Equity Interest in or Indebtedness
of such Subsidiary are owned by or on behalf of the Borrower or any
Guarantor, the Borrower will cause such Equity Interests and promissory
notes evidencing such Indebtedness to be pledged to the Administrative Agent
and the Lenders within three Business Days after such Subsidiary is formed
or acquired (except that, if such Subsidiary is a Foreign Subsidiary, shares
of common stock of such Subsidiary to be pledged may be limited to 65% of
the outstanding shares of common stock of such Subsidiary).
SECTION 7.12. Real Property.
Upon acquisition of any ownership interest in real
property by the Borrower or any Subsidiary, the Borrower will, and will
cause each such Subsidiary to, execute and deliver to the Administrative
Agent such documents as the Administrative Agent may require, granting a
first priority lien to the Administrative Agent for the benefit of the
Lenders on such real property and all improvements and other property,
rights and interests located thereon or related thereto, which documents
shall be in form and substance satisfactory to the Administrative Agent,
together with evidence of the recordation thereof and such title insurance
policies, surveys, appraisals, environmental reports, certificates,
instruments and legal opinions requested by the Administrative Agent in
connection therewith.
SECTION 7.13. Further Assurances. The Borrower will, and will cause each
Subsidiary to, execute and deliver such further agreements and instruments
and take such further action as may be requested by the Administrative Agent
to carry out the provisions and purposes of this Agreement and the other
Loan Documents and to create, preserve, and perfect the Liens of the
Administrative Agent, for the benefit of the Administrative Agent and the
Lenders, in the Collateral.
ARTICLE VIII
Negative Covenants
Until the Commitments have expired or terminated and the principal of
and interest on each Loan and all fees payable hereunder have been paid in
full, and all Letters of Credit have expired or terminated and all
LC Disbursements shall have been reimbursed, the Borrower covenants and
agrees with the Administrative Agent and the Lenders that:
SECTION 8.01 Indebtedness. The Borrower will not, and will not permit any
Subsidiary to, create, incur, assume or permit to exist any Indebtedness,
except:
(a) Indebtedness created hereunder;
(b) Indebtedness existing on the date hereof and set forth in
Schedule 8.01, and extensions, renewals and replacements of any such
Indebtedness that do not increase the outstanding principal amount thereof
or result in an earlier maturity date;
(c) Indebtedness of the Borrower to any Guarantor and of any
Subsidiary to the Borrower or any other Subsidiary that is a Guarantor;
(d) Guarantees by the Borrower of Indebtedness of any Subsidiary
and by any Subsidiary of Indebtedness of the Borrower or any other
Subsidiary;
(e) Capital Lease Obligations, provided that no Default exists or
results therefrom;
(f) purchase money Indebtedness of the Borrower or any Subsidiary
representing the purchase price of equipment, that is secured by the asset
purchased, provided that (i) the principal amount of such Indebtedness does
not exceed the purchase price of the equipment acquired, (ii) the Lien does
not attach to any other assets of the Borrower or any Subsidiary, and (iii)
no Default exists or results therefrom;
(g) the Subordinated Debt in a principal amount not to exceed
$20,000,000;
(h) Hedging Agreements permitted by Section 8.05; and
(i) other unsecured Indebtedness in an aggregate principal amount
not exceeding $1,000,000 at any time outstanding, provided that no Default
exists or results therefrom.
SECTION 8.02. Liens.
The Borrower will not, and will not permit any Subsidiary
to, create, incur, assume or permit to exist any Lien on any property or
asset now owned or hereafter acquired by it, or assign or sell any income or
revenues (including accounts receivable) or rights in respect of any
thereof, except:
(a) Permitted Encumbrances;
(b) any Lien on any property or asset of the Borrower or any
Subsidiary existing on the date hereof and set forth in Schedule 8.02;
provided that (i) such Lien shall not apply to any other property or asset
of the Borrower or any Subsidiary and (ii) such Lien shall secure only those
obligations which it secures on the date hereof and extensions, renewals and
replacements thereof that do not increase the outstanding principal amount
thereof;
(c) Liens permitted by clauses (e) and (f) of Section 8.01; and
(d) Liens created under the Loan Documents.
SECTION 8.03. Fundamental Changes.
(a) The Borrower will not, and will not permit any Subsidiary to,
merge into or consolidate with any other Person, or permit any other Person
to merge into or consolidate with it, or liquidate or dissolve, except that,
if at the time thereof and immediately after giving effect thereto no
Default shall have occurred and be continuing (i) any Subsidiary may merge
into the Borrower in a transaction in which the Borrower is the surviving
corporation, (ii) any Subsidiary that is not a Guarantor may merge into any
Subsidiary in a transaction in which the surviving entity is a Subsidiary,
(iii) any Guarantor may be dissolved, liquidated or merged into another
Subsidiary, so long as such dissolution, liquidation or merger results in
all assets of such Guarantor being owned by the Borrower or another
Guarantor, (iv) any Subsidiary that is not a Guarantor may liquidate or
dissolve if the Borrower determines in good faith that such liquidation or
dissolution is in the best interests of the Borrower and is not materially
disadvantageous to the Lenders and so long as such liquidation or
dissolution results in all assets of such Subsidiary being owned by the
Borrower or another Subsidiary, and (v) any Person that is not a Subsidiary
may merge into the Borrower in a transaction in which the Borrower is the
surviving corporation or into any Subsidiary in a transaction in which the
surviving entity is a Subsidiary; provided that any such merger involving a
Person that is not a wholly-owned Subsidiary immediately prior to such
merger shall not be permitted unless (x) such merger is also permitted by
Section 8.04 and (y) such merger does not result in and is not part of a
transaction or series of transactions that result in a Change in Control.
(b) The Borrower will not, and will not permit any of its
Subsidiaries to, engage to any material extent in any business other than
businesses of the type conducted by the Borrower and its Subsidiaries on the
date of execution of this Agreement and businesses reasonably related
thereto.
SECTION 8.04. Investments, Loans, Advances, Guarantees and Acquisitions. The
Borrower will not, and will not permit any of its Subsidiaries to, purchase,
hold or acquire (including pursuant to any merger with any Person that was
not a wholly owned Subsidiary prior to such merger) any Equity Interests,
evidences of indebtedness or other securities (including any option, warrant
or other right to acquire any of the foregoing) of, make or permit to exist
any loans or advances to, Guarantee any obligations of, or make or permit to
exist any investment or any other interest in, any other Person, or purchase
or otherwise acquire (in one transaction or a series of transactions) all or
substantially all of the assets of any other Person or any assets of any
other Person constituting a business unit or division, except:
(a) Permitted Investments;
(b) Equity Interests existing on the date hereof in the
Subsidiaries;
(c) loans or advances made by the Borrower to any Guarantor and
made by any Subsidiary to the Borrower or any other Subsidiary that is a
Guarantor;
(d) the Acquisition of the Company;
(e) Guarantees constituting Indebtedness permitted by
Section 8.01; and
(f) Acquisitions of Persons engaged in business of the type
conducted by the Borrower and the Subsidiaries on the date of execution of
this Agreement and businesses reasonably related thereto, provided that (i)
the total cash and non-cash consideration paid and Indebtedness assumed or
incurred by Borrower or any Subsidiary for all of such Acquisition(s)
(excluding the Acquisition of the Company) shall not exceed $20,000,000 in
the aggregate, and (ii) at the time of any such Acquisition, no Default
exists or would result or is projected to result from any such Acquisition.
SECTION 8.05. Hedging Agreements.
The Borrower will not, and will not permit any
of its Subsidiaries to, enter into any Hedging Agreement; provided, however,
that Borrower and its Subsidiaries shall be permitted to enter into Hedging
Agreements in the ordinary course of business to hedge or mitigate risks to
which the Borrower or any Subsidiary is exposed in the conduct of its
business or the management of its liabilities, so long as (a) no Default
exists, (b) such Hedging Agreements shall have a term of less than 90 days,
and (c) the aggregate amount of the obligations of Borrower and its
Subsidiaries in respect of any and all Hedging Agreements having a term of
90 days or longer, determined in accordance with clause (m) of the
definition of "Indebtedness" set forth in Section1.01, shall not exceed
$2,000,000.
SECTION 8.06. Restricted Payments; Certain Payments of Indebtedness.
(a) The Borrower will not, and will not permit any of its
Subsidiaries to, declare or make, or agree to pay or make, directly or
indirectly, any Restricted Payment or incur any obligation, (contingent or
otherwise) to do so, except (a) the Borrower may declare and pay dividends
with respect to its capital stock payable solely in additional shares of its
common stock, (b) Subsidiaries may declare and pay dividends to the Borrower
or any Guarantor and (c) the Borrower or any Subsidiary may acquire Equity
Interests in the Borrower in an amount not to exceed an aggregate amount of
$5,000,000 under an annual stock repurchase plan.
(b) The Borrower will not, and will not permit any Subsidiary to,
make or agree to pay or make, directly or indirectly, any payment or other
distribution (whether in cash securities or other property) of or in respect
of principal of or interest on any Indebtedness, or any payment or other
distribution (whether in cash, securities or other property), including any
sinking fund or similar deposit, on account of the purchase, redemption,
retirement, acquisition, cancellation or termination of any Indebtedness,
except:
(i) payment of Indebtedness created under the Loan Documents;
(ii) payment of regularly scheduled interest and principal
payments as and when due in respect of any Indebtedness, other
than payments in respect of the Subordinated Debt prohibited by
the subordination provisions thereof;
(iii) refinancings of Indebtedness to the extent permitted by
Section 8.01; and
(iv) payment of secured Indebtedness that becomes due as a
result of the voluntary sale or transfer of the property or assets
securing such Indebtedness.
SECTION 8.07. Transactions with Affiliates.
The Borrower will not, and will not
permit any of its Subsidiaries to, sell, lease or otherwise transfer any
property or assets to, or purchase, lease or otherwise acquire any property
or assets from, or otherwise engage in any other transactions with, any of
its Affiliates, except as permitted in Section 8.03 and except (a) in the
ordinary course of business at prices and on terms and conditions not less
favorable to the Borrower or such Subsidiary than could be obtained on an
arm's-length basis from unrelated third parties, (b) transactions between or
among the Borrower and the Guarantors not involving any other Affiliate and
(c) any Restricted Payment permitted by Section 8.06.
SECTION 8.08. Restrictive Agreements.
The Borrower will not, and will not permit
any of its Subsidiaries to, directly or indirectly, enter into, incur or
permit to exist any agreement or other arrangement that prohibits, restricts
or imposes any condition upon (a) the ability of the Borrower or any
Subsidiary to create, incur or permit to exist any Lien upon any of its
property or assets, or (b) the ability of any Subsidiary to pay dividends or
other distributions with respect to any shares of its capital stock or to
make or repay loans or advances to the Borrower or any other Subsidiary or
to Guarantee Indebtedness of the Borrower or any other Subsidiary; provided
that (i) the foregoing shall not apply to restrictions and conditions
imposed by law or by any Loan Document, (ii) the foregoing shall not apply
to restrictions and conditions existing on the date hereof identified on
Schedule 8.08 (but shall apply to any extension or renewal of, or any
amendment or modification expanding the scope of, any such restriction or
condition), (iii) the foregoing shall not apply to customary restrictions
and conditions contained in agreements relating to the sale of a Subsidiary
pending such sale, provided such restrictions and conditions apply only to
the Subsidiary that is to be sold and such sale is permitted hereunder,
(iv) clause (a) of the foregoing shall not apply to restrictions or
conditions imposed by any agreement relating to secured Indebtedness
permitted by this Agreement if such restrictions or conditions apply only to
the property or assets securing such Indebtedness and (v) clause (a) of the
foregoing shall not apply to customary provisions in leases and other
contracts restricting the assignment thereof.
SECTION 8.09. Disposition of Assets.
Except as otherwise permitted in Section
8.03, the Borrower will not and will not permit any Subsidiary to sell,
lease, assign, transfer, or otherwise dispose of any of their respective
assets (including without limitation stock or other Equity Interests in any
of the Subsidiaries or any of the voting rights of any such stock or other
Equity Interests); provided, however, that the following dispositions shall
be permitted so long as the Borrower and the Subsidiaries, as applicable,
receive full, fair and reasonable consideration at the time of such
disposition at least equal to the fair market value of such asset being
disposed:
(a) dispositions of inventory in the ordinary course of business
of the Borrower and its Subsidiaries;
(b) sales, transfers and other dispositions to the Borrower or any
wholly-owned Subsidiary that is a Guarantor;
(c) disposition of assets that are worn out, obsolete or no longer
used or useful in the conduct of the business of the Borrower and the
Subsidiaries, so long as such assets are replaced with assets of equal or
greater value; and
(d) dispositions of assets constituting business units or
divisions of the Borrower or any Subsidiary to the extent that (i) the
aggregate book value of such assets does not exceed 10% of the fixed assets
of the Borrower and the Subsidiaries (which shall be calculated by reference
to the most recent financial statements provided under Section 7.01 hereof)
or (ii) the aggregate EBITDA generated during the twelve-month period from
such assets prior to such disposition does not exceed 10% of EBITDA for the
prior twelve month period. Notwithstanding anything to the contrary
contained in Section 8.03 of this Agreement, a business unit or division of
the Borrower or any Subsidiary that is a Subsidiary but is not a Guarantor
may be disposed of under the terms of this Section 8.09(d).
SECTION 8.10. Sale and Leaseback. The Borrower will not enter into, and will
not permit any Subsidiary to enter into, any arrangement with any Person
pursuant to which it leases from such Person real or personal property that
has been or is to be sold or transferred, directly or indirectly, by it to
such Person.
SECTION 8.11. Accounting.
The Borrower will not, and will not permit any of its
Subsidiaries to, change its fiscal year or make any change (a) in accounting
treatment or reporting practices, except as required by GAAP and disclosed
to the Administrative Agent, or (b) in tax reporting treatment, except as
required by law and disclosed to the Administrative Agent.
SECTION 8.12. Amendment of Material Documents.
The Borrower will not, and will
not permit any Subsidiary to, amend, modify or waive any of its rights under
(a) any Subordinated Debt document or (b) its certificate of incorporation,
by-laws or other organizational documents, unless such amendment,
modification or waiver under its certificate of incorporation, by-laws or
other organizational documents would not create a Material Adverse Effect.
SECTION 8.13. Preferred Equity Interests.
The Borrower will not, and will not
permit any Subsidiary to, issue any preferred stock or other preferred
Equity Interests.
ARTICLE IX
Financial Covenants
Until the Commitments have expired or been terminated and the principal
of and interest on each Loan and all fees payable hereunder shall have been
paid in full, the Borrower covenants and agrees with the Administrative
Agent and the Lenders that:
SECTION 9.01 Consolidated Leverage Ratio. The Borrower will at all times
maintain or cause to be maintained a Consolidated Leverage Ratio of not
greater than 2.00 to 1.00.
SECTION 9.02. Consolidated Fixed Charge Coverage Ratio. The Borrower will
at all times maintain or cause to be maintained a Consolidated Fixed
Charge Coverage Ratio of not less than 3.00 to 1.00.
SECTION 9.03. Liquidity. he Borrower will, and will cause its Subsidiaries
to, at all times maintain Consolidated Liquidity in an amount not less than
$10,000,000.
ARTICLE X
Events of Default
SECTION 10.01 Default. If any of the following Events of Default shall
occur:
(a) the Borrower shall fail to pay any principal of any Loan or
any reimbursement obligation in respect of any LC Disbursement when and as
the same shall become due and payable, whether at the due date thereof or at
a date fixed for prepayment thereof or otherwise;
(b) the Borrower shall fail to pay any interest on any Loan or any
fee or any other amount (other than an amount referred to in clause (a) of
this Section) payable under this Agreement, when and as the same shall
become due and payable, and such failure shall continue unremedied for a
period of five Business Days;
(c) any representation or warranty made or deemed made by or on
behalf of the Borrower or any Subsidiary in or in connection with this
Agreement or any other Loan Document or any amendment or modification hereof
or thereof or waiver hereunder or thereunder, or in any report, certificate,
financial statement or other document furnished pursuant to or in connection
with this Agreement or any other Loan Document or any amendment or
modification hereof or thereof or waiver hereunder or thereunder, shall
prove to have been incorrect when made or deemed made;
(d) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in Section 7.02 or 7.03 (with respect to
the Borrower's existence) or 7.09 or in Article VIII or in Article IX;
(e) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in this Agreement (other than those
specified in clause (a), (b) or (d) of this Section), and such failure shall
continue unremedied for a period of 30 days after the earlier of notice
thereof from the Administrative Agent to the Borrower (which notice will be
given at the request of any Lender or the Borrower's or any Subsidiary's
actual knowledge of such failure);
(f) the Borrower or any Subsidiary shall fail to make any payment
(whether of principal or interest and regardless of amount) in respect of
any Material Indebtedness, when and as the same shall become due and
payable;
(g) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that enables or
permits (with or without the giving of notice, the lapse of time or both)
the holder or holders of any Material Indebtedness or any trustee or agent
on its or their behalf to cause any Material Indebtedness to become due, or
to require the prepayment, repurchase, redemption or defeasance thereof,
prior to its scheduled maturity; provided that this clause (g) shall not
apply to secured Indebtedness that becomes due as a result of the voluntary
sale or transfer of the property or assets securing such Indebtedness;
(h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other
relief in respect of the Borrower or any Subsidiary or its debts, or of a
substantial part of its assets, under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in
effect or (ii) the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the Borrower or any
Subsidiary or for a substantial part of its assets, and, in any such case,
such proceeding or petition shall continue undismissed for 60 days or an
order or decree approving or ordering any of the foregoing shall be entered;
(i) the Borrower or any Subsidiary shall (i) voluntarily commence
any proceeding or file any petition seeking liquidation, reorganization or
other relief under any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect, (ii) consent to the
institution of, or fail to contest in a timely and appropriate manner, any
proceeding or petition described in clause (h) of this Section, (iii) apply
for or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the Borrower or any
Subsidiary or for a substantial part of its assets, (iv) file an answer
admitting the material allegations of a petition filed against it in any
such proceeding, (v) make a general assignment for the benefit of creditors
or (vi) take any action for the purpose of effecting any of the foregoing;
(j) the Borrower or any Subsidiary shall become unable, admit in
writing its inability or fail generally to pay its debts as they become due;
(k) one or more judgments for the payment of money in an aggregate
amount in excess of $1,000,000 shall be rendered against the Borrower, any
Subsidiary or any combination thereof and the same shall remain undischarged
for a period of 30 consecutive days during which execution shall not be
effectively stayed, or any action shall be legally taken by a judgment
creditor to attach or levy upon any assets of the Borrower or any Subsidiary
to enforce any such judgment;
(l) an ERISA Event shall have occurred that, in the opinion of the
Required Lenders, when taken together with all other ERISA Events that have
occurred, could reasonably be expected to result in liability of the
Borrower and its Subsidiaries in an aggregate amount exceeding
(i) $1,000,000 in any year or (ii) $1,000,000 for all periods;
(m) a Change in Control shall occur;
(n) a Material Adverse Effect shall occur;
(o) this Agreement or any other Loan Document shall cease to be in
full force and effect or shall be declared null and void or the validity or
enforceability thereof shall be contested or challenged by the Borrower or
any Subsidiary or any of their respective shareholders, or the Borrower or
any Guarantor shall deny that it has any further liability or obligation
under any of the Loan Documents, or any Lien created by the Loan Documents
shall for any reason cease to be a valid, first priority perfected security
interest in and Lien upon any of the Collateral purported to be covered
thereby; or
(p) the Borrower or any Subsidiary, or any of their properties,
revenues or assets shall become subject to an order of forfeiture, seizure
or divestiture and the same shall not have been discharged within 30 days
from the date of entry thereof.
then, and in every such event (other than an event with respect to the
Borrower described in clause (h) or (i) of this Section), and at any time
thereafter during the continuance of such event, the Administrative Agent
may, and at the request of the Required Lenders shall, by notice to the
Borrower, take either or both of the following actions, at the same or
different times: (i) terminate the Commitments, and thereupon the
Commitments shall terminate immediately, and (ii) declare the Loans then
outstanding to be due and payable in whole (or in part, in which case any
principal not so declared to be due and payable may thereafter be declared
to be due and payable), and thereupon the principal of the Loans so declared
to be due and payable, together with accrued interest thereon and all fees
and other obligations of the Borrower accrued hereunder, shall become due
and payable immediately, without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrower; and in
case of any event with respect to the Borrower described in clause (h), (i)
or (n) of this Section, the Commitments shall automatically terminate and
the principal of the Loans then outstanding, together with accrued interest
thereon and all fees and other obligations of the Borrower accrued
hereunder, shall automatically become due and payable, without notice,
demand, presentment, notice of dishonor, notice of acceleration, notice of
intent to accelerate, notice of intent to demand, protest, or other
formalities of any kind, all of which are hereby waived by the Borrower. If
any Event of Default shall occur and be continuing, the Administrative Agent
may exercise all rights and remedies available to it in law or in equity,
under the Loan Documents, or otherwise, including, without limitation, the
right to foreclose or otherwise enforce any Lien granted to the
Administrative Agent for the benefit of itself and the Lenders to secure
payment and performance of the Obligations.
SECTION 10.02. Performance by the Administrative Agent. If the Borrower
shall fail to perform any covenant or agreement contained in any of the Loan
Documents, the Administrative Agent may perform or attempt to perform such
covenant or agreement on behalf of the Borrower. In such event, the
Borrower shall, at the request of the Administrative Agent, promptly pay any
amount expended by the Administrative Agent in connection with such
performance or attempted performance to the Administrative Agent, together
with interest thereon at the Maximum Rate from and including the date of
such expenditure to but excluding the date such expenditure is paid in full.
Notwithstanding the foregoing, it is expressly agreed that neither the
Administrative Agent nor any Lender shall not have any liability or
responsibility for the performance of any obligation of the Borrower under
this Agreement or any other Loan Document.
ARTICLE XI
The Administrative Agent
Each of the Lenders and the Issuing Bank hereby irrevocably appoints
the Administrative Agent as its agent and authorizes the Administrative
Agent to take such actions on its behalf and to exercise such powers as are
delegated to the Administrative Agent by the terms of the Loan Documents,
together with such actions and powers as are reasonably incidental thereto.
The bank serving as the Administrative Agent hereunder shall have the
same rights and powers in its capacity as a Lender as any other Lender and
may exercise the same as though it were not the Administrative Agent, and
such bank and its Affiliates may accept deposits from, lend money to and
generally engage in any kind of business with the Borrower or any Subsidiary
or other Affiliate thereof as if it were not the Administrative Agent
hereunder.
The Administrative Agent shall not have any duties or obligations
except those expressly set forth herein. Without limiting the generality of
the foregoing, (a) the Administrative Agent shall not be subject to any
fiduciary or other implied duties, regardless of whether a Default has
occurred and is continuing, (b) the Administrative Agent shall not have any
duty to take any discretionary action or exercise any discretionary powers,
except discretionary rights and powers expressly contemplated hereby that
the Administrative Agent is required to exercise in writing by the Required
Lenders (or such other number or percentage of the Lenders as shall be
necessary under the circumstances as provided in Section 12.02), and
(c) except as expressly set forth herein, the Administrative Agent shall not
have any duty to disclose, and shall not be liable for the failure to
disclose, any information relating to the Borrower or any of its
Subsidiaries that is communicated to or obtained by the bank serving as
Administrative Agent or any of its Affiliates in any capacity. The
Administrative Agent shall not be liable for any action taken or not taken
by it with the consent or at the request of the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 12.02) or in the absence of its own
gross negligence or wilful misconduct. The Administrative Agent shall be
deemed not to have knowledge of any Default unless and until written notice
thereof is given to the Administrative Agent by the Borrower or a Lender,
and the Administrative Agent shall not be responsible for or have any duty
to ascertain or inquire into (i) any statement, warranty or representation
made in or in connection with any Loan Document, (ii) the contents of any
certificate, report or other document delivered hereunder or in connection
herewith, (iii) the performance or observance of any of the covenants,
agreements or other terms or conditions set forth in any Loan Document,
(iv) the validity, enforceability, effectiveness or genuineness of any Loan
Document or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in Article VI or elsewhere in any
Loan Document, other than to confirm receipt of items expressly required to
be delivered to the Administrative Agent.
The Administrative Agent shall be entitled to rely upon, and shall not
incur any liability for relying upon, any notice, request, certificate,
consent, statement, instrument, document or other writing believed by it to
be genuine and to have been signed or sent by the proper Person. The
Administrative Agent also may rely upon any statement made to it orally or
by telephone and believed by it to be made by the proper Person, and shall
not incur any liability for relying thereon. The Administrative Agent may
consult with legal counsel (who may be counsel for the Borrower),
independent accountants and other experts selected by it, and shall not be
liable for any action taken or not taken by it in accordance with the advice
of any such counsel, accountants or experts.
The Administrative Agent may perform any and all its duties and
exercise its rights and powers by or through any one or more subagents
appointed by the Administrative Agent. The Administrative Agent and any
such subagent may perform any and all its duties and exercise its rights and
powers through their respective Related Parties. The exculpatory provisions
of the preceding paragraphs shall apply to any such subagent and to the
Related Parties of the Administrative Agent and any such subagent, and shall
apply to their respective activities in connection with the syndication of
the credit facilities provided for herein as well as activities as
Administrative Agent.
Subject to the appointment and acceptance of a successor Administrative
Agent as provided in this paragraph, the Administrative Agent may resign at
any time by notifying the Lenders, the Issuing Bank and the Borrower. Upon
any such resignation, the Required Lenders shall have the right, with the
consent of the Borrower (which consent shall not be unreasonably withheld,
and shall not be required if any Event of Default exists) to appoint a
successor. If no successor shall have been so appointed by the Required
Lenders and shall have accepted such appointment within 30 days after the
retiring Administrative Agent gives notice of its resignation, then the
retiring Administrative Agent may, after consulting with the Lenders, the
Issuing Bank and the Borrower, appoint a successor Administrative Agent
which shall be a bank with an office in Dallas, Texas, or an Affiliate of
any such bank. Upon the acceptance of its appointment as Administrative
Agent hereunder by a successor, such successor shall succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder. The fees payable by
the Borrower to a successor Administrative Agent shall be the same as those
payable to its predecessor unless otherwise agreed between the Borrower and
such successor. After the Administrative Agent's resignation hereunder, the
provisions of this Article and Section 12.03 shall continue in effect for
the benefit of such retiring Administrative Agent, its subagents and their
respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while it was acting as Administrative Agent.
Each Lender acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Lender and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make
its own decisions in taking or not taking action under or based upon this
Agreement, any related agreement or any document furnished hereunder or
thereunder.
ARTICLE XII
Miscellaneous
SECTION 12.01. Notices.
Except in the case of notices and other communications
expressly permitted to be given by telephone, all notices and other
communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
(a) if to the Borrower, to it at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇
(Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇);
(b) if to the Administrative Agent, to The Chase Manhattan Bank,
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇ ▇.
▇▇▇▇▇▇ (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇), and, for any Borrowing Requests, with
a copy to The Chase Manhattan Bank, Agency Services, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
(Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇);
(c) if to the Issuing Bank, to it at The Chase Manhattan Bank,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇; and
(d) if to any other Lender, to it at its address (or telecopy
number) set forth in its Administrative Questionnaire.
Any party hereto may change its address or telecopy number for notices and
other communications hereunder by notice to the other parties hereto. All
notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on
the date of receipt.
SECTION 12.02. Waivers; Amendments. No failure or delay by
the Administrative Agent, the Issuing Bank or any Lender in
exercising any right or power hereunder or under any other Loan Document
shall operate as a waiver thereof, nor shall any single or partial exercise
of any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and
remedies of the Administrative Agent, the Issuing Bank and the Lenders
hereunder and under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No
waiver of any provision of any Loan Document or consent to any departure by
the Borrower or any Subsidiary therefrom shall in any event be effective
unless the same shall be permitted by paragraph (b) of this Section, and
then such waiver or consent shall be effective only in the specific instance
and for the purpose for which given. Without limiting the generality of the
foregoing, the making of a Loan or issuance of a Letter of Credit shall not
be construed as a waiver of any Default, regardless of whether the
Administrative Agent, any Lender or the Issuing Bank may have had notice or
knowledge of such Default at the time.
(a) Neither this Agreement nor any other Loan Document nor any
provision hereof may be waived, amended or modified except, in the case of
this Agreement, pursuant to an agreement or agreements in writing entered
into by the Borrower and the Required Lenders or by the Borrower and the
Administrative Agent with the consent of the Required Lenders or, in the
case of any other Loan Document, pursuant to an agreement or agreements in
writing entered into by the Administrative Agent and the other parties
thereto; provided that no such agreement shall (i) increase the Commitment
of any Lender without the written consent of such Lender, (ii) reduce the
principal amount of any Loan or LC Disbursement, or reduce the rate of
interest thereon, or reduce any fees payable hereunder, without the written
consent of each Lender, (iii) postpone the scheduled date of payment of the
principal amount of any Loan, or LC Disbursement, or any interest thereon,
or any fees payable hereunder, or reduce the amount of, waive or excuse any
such payment, or postpone the scheduled date of expiration of any
Commitment, without the written consent of each Lender, (iv) change
Section 2.12(b) or (c) in a manner that would alter the pro rata sharing of
payments required thereby, without the written consent of each Lender,
(v) reduce the Commitment of any Lender without the written consent of each
Lender, (vi) modify or waive Section 10.01(m) or the definition of "Change
in Control" without the written consent of each Lender, (vii) release any
Collateral or Guarantor without the written consent of each Lender, except
in connection with dispositions, mergers or dissolutions expressly permitted
by this Agreement, or (viii) change any of the provisions of this Section or
the definition of "Required Lenders" or any other provision hereof
specifying the number or percentage of Lenders required to waive, amend or
modify any rights hereunder or make any determination or grant any consent
hereunder, without the written consent of each Lender; provided further
that no such agreement shall amend, modify or otherwise affect the rights or
duties of the Administrative Agent or the Issuing Bank hereunder without the
prior written consent of the Administrative Agent or the Issuing Bank, as
the case may be.
SECTION 12.03. Expenses; Indemnity; Damage Waiver.
The Borrower shall pay (i) all out-of-pocket expenses incurred by
the Administrative Agent and its Affiliates, including the reasonable fees,
charges and disbursements of counsel for the Administrative Agent, in
connection with the syndication of the credit facilities provided for
herein, the preparation and administration of this Agreement, the other Loan
Documents or any amendments, modifications or waivers of the provisions
hereof or thereof (whether or not the transactions contemplated hereby or
thereby shall be consummated), (ii) all out-of-pocket expenses incurred by
the Administrative Agent or the Issuing Bank, and, after an Event of
Default, any Lender, including the fees, charges and disbursements of any
counsel for the Administrative Agent, the Issuing Bank, or any Lender in
connection with the enforcement or protection of its rights in connection
with this Agreement and the other Loan Documents, including its rights under
this Section, or in connection with the Loans made or Letters of Credit
issued hereunder, including all such out-of-pocket expenses incurred during
any workout, restructuring or negotiations in respect of such Loans or
Letters of Credit, (iii) all transfer, stamp, documentary, or other similar
taxes, assessments or charges levied by any Governmental Authority in
respect of this Agreement or any of the other Loan Documents, (iv) all
costs, out-of-pocket expenses, assessments and other charges incurred in
connection with any filing, registration, recording, or perfection of any
security interest or Lien contemplated by this Agreement or any other Loan
Document, (v) all reasonable out-of-pocket expenses incurred by the Issuing
Bank in connection with the issuance, amendment, renewal or extension of any
Letter of Credit or any demand for payment thereunder, and (vi) all other
costs and out-of-pocket expenses incurred by the Administrative Agent in
connection with this Agreement, any other Loan Document or the Collateral,
including without limitation costs, fees, expenses and other charges
incurred in connection with performing or obtaining any audit or appraisal
in respect of the Collateral or for any surveys, environmental assessments,
title insurance, filing fees, recording costs and lien searches.
(a) THE BORROWER SHALL INDEMNIFY THE ADMINISTRATIVE AGENT, THE
ISSUING BANK AND EACH LENDER, AND EACH RELATED PARTY OF ANY OF THE FOREGOING
PERSONS (EACH SUCH PERSON BEING CALLED AN "INDEMNITEE") AGAINST, AND HOLD
EACH INDEMNITEE HARMLESS FROM, ANY AND ALL LOSSES, CLAIMS, DAMAGES,
LIABILITIES AND RELATED EXPENSES, INCLUDING THE FEES, CHARGES AND
DISBURSEMENTS OF ANY COUNSEL FOR ANY INDEMNITEE, INCURRED BY OR ASSERTED
AGAINST ANY INDEMNITEE ARISING OUT OF, IN CONNECTION WITH, OR AS A RESULT OF
(I) THE EXECUTION OR DELIVERY OF THIS AGREEMENT OR ANY AGREEMENT OR
INSTRUMENT CONTEMPLATED HEREBY, THE PERFORMANCE BY THE PARTIES HERETO OF
THEIR RESPECTIVE OBLIGATIONS HEREUNDER OR THE CONSUMMATION OF THE
TRANSACTIONS OR ANY OTHER TRANSACTIONS CONTEMPLATED HEREBY, (II) ANY LOAN OR
LETTER OF CREDIT OR THE USE OF THE PROCEEDS THEREFROM (INCLUDING ANY REFUSAL
BY THE ISSUING BANK TO HONOR A DEMAND FOR PAYMENT UNDER A LETTER OF CREDIT
IF THE DOCUMENTS PRESENTED IN CONNECTION WITH SUCH DEMAND DO NOT STRICTLY
COMPLY WITH THE TERMS OF SUCH LETTER OF CREDIT), (III) ANY ACTUAL OR ALLEGED
PRESENCE OR RELEASE OF HAZARDOUS MATERIALS ON OR FROM ANY PROPERTY OWNED OR
OPERATED BY THE BORROWER OR ANY OF ITS SUBSIDIARIES, OR ANY ENVIRONMENTAL
LIABILITY RELATED IN ANY WAY TO THE BORROWER OR ANY OF ITS SUBSIDIARIES, OR
(IV) ANY ACTUAL OR PROSPECTIVE CLAIM, LITIGATION, INVESTIGATION OR
PROCEEDING RELATING TO ANY OF THE FOREGOING, WHETHER BASED ON CONTRACT, TORT
OR ANY OTHER THEORY AND REGARDLESS OF WHETHER ANY INDEMNITEE IS A PARTY
THERETO; PROVIDED THAT SUCH INDEMNITY SHALL NOT, AS TO ANY INDEMNITEE, BE
AVAILABLE TO THE EXTENT THAT SUCH LOSSES, CLAIMS, DAMAGES, LIABILITIES OR
RELATED EXPENSES ARE DETERMINED BY A COURT OF COMPETENT JURISDICTION BY
FINAL AND NONAPPEALABLE JUDGMENT TO HAVE RESULTED FROM THE GROSS NEGLIGENCE
OR WILFUL MISCONDUCT OF SUCH INDEMNITEE.
(b) To the extent that the Borrower fails to pay any amount
required to be paid by it to the Administrative Agent or the Issuing Bank
under paragraph (a) or (b) of this Section, each Lender severally agrees to
pay to the Administrative Agent or the Issuing Bank such Lender's Applicable
Percentage (determined as of the time that the applicable unreimbursed
expense or indemnity payment is sought) of such unpaid amount; provided that
the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by or asserted against the
Administrative Agent or the Issuing Bank, as the case may be, in its
capacity as such.
(c) To the extent permitted by applicable law, the Borrower shall
not assert, and hereby waives, any claim against any Indemnitee, on any
theory of liability, for special, indirect, consequential or punitive
damages (as opposed to direct or actual damages) arising out of, in
connection with, or as a result of, this Agreement or any agreement or
instrument contemplated hereby, the Transactions, any Loan or Letter of
Credit or the use of the proceeds thereof.
(d) All amounts due under this Section shall be payable upon
written demand therefor.
SECTION 12.04. Successors and Assigns. The provisions of
this Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns permitted
hereby (including any Affiliate of the Issuing Bank that issues any Letter
of Credit), except that the Borrower may not assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent
of each Lender (and any attempted assignment or transfer by the Borrower
without such consent shall be null and void). Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other
than the parties hereto, their respective successors and assigns permitted
hereby (including any Affiliate of the Issuing Bank that issues any Letter
of Credit), and, to the extent expressly contemplated hereby, the Related
Parties of each of the Administrative Agent, the Issuing Bank and the
Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.
(a) Any Lender may assign to one or more assignees all or a
portion of its rights and obligations under this Agreement (including all or
a portion of its Commitment and the Loans at the time owing to it); provided
that (i) except in the case of an assignment to a Lender or an Affiliate of
a Lender, each of the Borrower and the Administrative Agent (and, in the
case of an assignment of all or a portion of a Commitment or any Lender's
obligations in respect of its LC Exposure, the Issuing Bank) must give their
prior written consent to such assignment (which consent shall not be
unreasonably withheld), (ii) except in the case of an assignment to a Lender
or an Affiliate of a Lender or an assignment of the entire remaining amount
of the assigning Lender's Commitment, the amount of the Commitment of the
assigning Lender subject to each such assignment (determined as of the date
the Assignment and Acceptance with respect to such assignment is delivered
to the Administrative Agent) shall not be less than $5,000,000 unless each
of the Borrower and the Administrative Agent otherwise consent, (iii) each
partial assignment shall be made as an assignment of a proportionate part of
all the assigning Lender's rights and obligations under this Agreement,
(iv) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Acceptance, together with a
processing and recordation fee of $3,500, and (v) the assignee, if it shall
not be a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire; and provided further that any consent of the Borrower
otherwise required under this paragraph shall not be required if an Event of
Default under Article X has occurred and is continuing. Subject to
acceptance and recording thereof pursuant to paragraph (d) of this Section,
from and after the effective date specified in each Assignment and
Acceptance the assignee thereunder shall be a party hereto and, to the
extent of the interest assigned by such Assignment and Acceptance, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering all of
the assigning Lender's rights and obligations under this Agreement, such
Lender shall cease to be a party hereto but shall continue to be entitled to
the benefits of Sections 2.11, 3.01, 3.05 and 12.03). Any assignment or
transfer by a Lender of rights or obligations under this Agreement that does
not comply with this paragraph shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with paragraph (e) of this Section.
(b) The Administrative Agent, acting for this purpose as an agent
of the Borrower, shall maintain at one of its offices in Dallas, Texas a
copy of each Assignment and Acceptance delivered to it and a register for
the recordation of the names and addresses of the Lenders, and the
Commitment of, and principal amount of the Loans and LC Disbursements owing
to, each Lender pursuant to the terms hereof from time to time (the
"Register"). The entries in the Register shall be conclusive, and the
Borrower, the Administrative Agent, the Issuing Bank and the Lenders may
treat each Person whose name is recorded in the Register pursuant to the
terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for
inspection by the Borrower, the Issuing Bank and any Lender, at any
reasonable time and from time to time upon reasonable prior notice.
(c) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b)
of this Section and any written consent to such assignment required by
paragraph (b) of this Section, the Administrative Agent shall accept such
Assignment and Acceptance and record the information contained therein in
the Register. No assignment shall be effective for purposes of this
Agreement unless it has been recorded in the Register as provided in this
paragraph. Each assigning Lender shall surrender any Note subject to such
assignment, and the Borrower shall execute and deliver to the Administrative
Agent in exchange for the surrendered Note a new Note payable to the order
of the assignee in an amount equal to the Commitment assumed by such
assignee pursuant to such Assignment and Acceptance and, if the assigning
Lender has retained a Commitment, a new Note payable to the order of the
assigning Lender in an amount equal to the Commitment retained by it
hereunder. Such new Notes shall be in an aggregate face amount of the
surrendered Note, shall be dated the effective date of such Assignment and
Acceptance, and shall otherwise be in substantially the form of Exhibit "A"
hereto and shall each constitute a "Note" for purposes of the Loan
Documents.
(d) Any Lender may, without the consent of the Borrower, the
Administrative Agent or the Issuing Bank, sell participations to one or more
banks or other entities (a "Participant") in all or a portion of such
Lender's rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans owing to it); provided that (i) such
Lender's obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Borrower, the Administrative
Agent, the Issuing Bank and the other Lenders shall continue to deal solely
and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Any agreement or instrument pursuant to
which a Lender sells such a participation shall provide that such Lender
shall retain the sole right to enforce the Loan Documents and to approve any
amendment, modification or waiver of any provision of the Loan Documents;
provided that such agreement or instrument may provide that such Lender will
not, without the consent of the Participant, agree to any amendment,
modification or waiver described in the first proviso to Section 12.02(b)
that affects such Participant. Subject to paragraph (f) of this Section,
the Borrower agrees that each Participant shall be entitled to the benefits
of Sections 2.11, 3.01 and 3.05 to the same extent as if it were a Lender
and had acquired its interest by assignment pursuant to paragraph (b) of
this Section. To the extent permitted by law, each Participant also shall
be entitled to the benefits of Section 12.08 as though it were a Lender,
provided such Participant agrees to be subject to Section 2.12(c) as though
it were a Lender.
(e) A Participant shall not be entitled to receive any greater
payment under Section 2.11 or 3.01 than the applicable Lender would have
been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is
made with the Borrower's prior written consent. A Participant that would be
a Foreign Lender if it were a Lender shall not be entitled to the benefits
of Section 2.11 unless the Borrower is notified of the participation sold to
such Participant and such Participant agrees, for the benefit of the
Borrower, to comply with Section 2.11(e) as though it were a Lender.
(f) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to
any such pledge or assignment of a security interest; provided that no such
pledge or assignment of a security interest shall release a Lender from any
of its obligations hereunder or substitute any such pledgee or assignee for
such Lender as a party hereto.
SECTION 12.05. Survival. All covenants, agreements, representations and
warranties made by the Borrower and the Subsidiaries in the Loan Documents
and in the certificates or other instruments delivered in connection with
or pursuant to this Agreement or any other Loan Document shall be considered
to have been relied upon by the other parties hereto and shall survive the
execution and delivery of the Loan Documents and the making of any Loans and
issuance of any Letters of Credit, regardless of any investigation made by
any such other party or on its behalf and notwithstanding that the
Administrative Agent, the Issuing Bank or any Lender may have had notice or
knowledge of any Default or incorrect representation or warranty at the time
any credit is extended hereunder, and shall continue in full force and
effect as long as the principal of or any accrued interest on any Loan or
any fee or any other amount payable under this Agreement is outstanding and
unpaid or any Letter of Credit is outstanding and so long as the Commitments
have not expired or terminated. The provisions of Sections 2.11, 3.01, 3.05
and 12.03 and Article XI shall survive and remain in full force and effect
regardless of the consummation of the transactions contemplated hereby, the
repayment of the Loans, the expiration or termination of the Letters of
Credit and the Commitments or the termination of this Agreement or any
provision hereof.
SECTION 12.06. Counterparts; Effectiveness.
This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts),
each of which shall constitute an original, but all of which when taken
together shall constitute a single contract. Except as provided in
Section 6.01, this Agreement shall become effective when it shall have been
executed by the Administrative Agent and when the Administrative Agent shall
have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns. Delivery of an executed counterpart of a
signature page of this Agreement by telecopy shall be effective as delivery
of a manually executed counterpart of this Agreement.
SECTION 12.07. Severability.
Any provision of this Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability
of the remaining provisions hereof; and the invalidity of a particular
provision in a particular jurisdiction shall not invalidate such provision
in any other jurisdiction.
SECTION 12.08. Right of Setoff.
If an Event of Default shall have occurred and be
continuing, each Lender and each of its Affiliates is hereby authorized at
any time and from time to time, to the fullest extent permitted by law, to
set off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other obligations at any time
owing by such Lender or Affiliate to or for the credit or the account of the
Borrower against any and all of the Obligations, irrespective of whether or
not any demand shall have been made under this Agreement and although such
Obligations may be unmatured. The rights of each Lender under this Section
are in addition to other rights and remedies (including other rights of
setoff) which such Lender may have.
SECTION 12.09. GOVERNING LAW; VENUE; SERVICE OF PROCESS.
THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS
AND THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. THIS AGREEMENT HAS
BEEN ENTERED INTO IN DALLAS COUNTY, TEXAS, AND IT SHALL BE PERFORMABLE FOR
ALL PURPOSES IN DALLAS COUNTY, TEXAS. ANY ACTION OR PROCEEDING AGAINST THE
BORROWER UNDER OR IN CONNECTION WITH ANY OF THE LOAN DOCUMENTS MAY BE
BROUGHT IN ANY STATE OR FEDERAL COURT IN DALLAS COUNTY, TEXAS. THE BORROWER
HEREBY IRREVOCABLY (A) SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF SUCH
COURTS, AND (B) WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE
VENUE OF ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT OR THAT ANY
SUCH COURT IS AN INCONVENIENT FORUM. THE BORROWER AGREES THAT SERVICE OF
PROCESS UPON IT MAY BE MADE BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT
REQUESTED, AT ITS ADDRESS SPECIFIED OR DETERMINED IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 12.01. NOTHING HEREIN OR IN ANY OF THE OTHER LOAN
DOCUMENTS SHALL AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENT OR ANY LENDER
TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE
RIGHT OF THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY LENDER TO BRING
ANY ACTION OR PROCEEDING AGAINST THE BORROWER OR WITH RESPECT TO ANY OF ITS
RESPECTIVE PROPERTY IN COURTS IN OTHER JURISDICTIONS. ANY ACTION OR
PROCEEDING BY THE BORROWER AGAINST THE ADMINISTRATIVE AGENT OR ANY LENDER
SHALL BE BROUGHT ONLY IN A COURT LOCATED IN DALLAS COUNTY, TEXAS.
SECTION 12.10. WAIVER OF JURY TRIAL.
EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN
THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.
SECTION 12.11. Headings.
Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 12.12. Confidentiality.
Each of the Administrative Agent and the Lenders
agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (a) to its Affiliates and
to its and its Affiliates' directors, officers, employees and agents,
including accountants, legal counsel and other advisors (it being understood
that the Persons to whom such disclosure is made will be informed of the
confidential nature of such Information and instructed to keep such
Information confidential), (b) to the extent requested by any regulatory
authority, (c) to the extent required by applicable laws or regulations or
by any subpoena or similar legal process, (d) to any other party to this
Agreement, (e) in connection with the exercise of any remedies hereunder or
any suit, action or proceeding relating to this Agreement or any other Loan
Document or the enforcement of rights hereunder or thereunder, (f) subject
to an agreement containing provisions substantially the same as those of
this Section, to any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this
Agreement, (g) with the consent of the Borrower or (h) to the extent such
Information (i) becomes publicly available other than as a result of a
breach of this Section or (ii) becomes available to the Administrative
Agent, the Issuing Bank or any Lender on a nonconfidential basis from a
source other than the Borrower. For the purposes of this Section,
"Information" means all information received from the Borrower relating to
the Borrower or its business, other than any such information that is
available to the Administrative Agent, the Issuing Bank or any Lender on a
nonconfidential basis prior to disclosure by the Borrower; provided that, in
the case of information received from the Borrower after the date hereof,
such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of
care to maintain the confidentiality of such Information as such Person
would accord to its own confidential information.
SECTION 12.13. Maximum Interest Rate.
No provision of this Agreement or of any
other Loan Document shall require the payment or the collection of interest
in excess of the maximum amount permitted by applicable law. If any excess
of interest in such respect is hereby provided for, or shall be adjudicated
to be so provided, in any Loan Document or otherwise in connection with this
loan transaction, the provisions of this Section shall govern and prevail
and neither the Borrower nor the sureties, guarantors, successors, or
assigns of the Borrower shall be obligated to pay the excess amount of such
interest or any other excess sum paid for the use, forbearance, or detention
of sums loaned pursuant hereto. In the event any Lender ever receives,
collects, or applies as interest any such sum, such amount which would be in
excess of the maximum amount permitted by applicable law shall be applied as
a payment and reduction of the principal of the indebtedness evidenced by
the Notes; and, if the principal of the Notes has been paid in full, any
remaining excess shall forthwith be paid to the Borrower. In determining
whether or not the interest paid or payable exceeds the Maximum Rate, the
Borrower and each Lender shall, to the extent permitted by applicable law,
(a) characterize any non-principal payment as an expense, fee, or premium
rather than as interest, (b) exclude voluntary prepayments and the effects
thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal
parts the total amount of interest throughout the entire contemplated term
of the indebtedness evidenced by the Notes so that interest for the entire
term does not exceed the Maximum Rate.
SECTION 12.14. Non-Application of Chapter 346 of Texas Finance Code. The
provisions of Chapter 346 of the Texas Finance Code (Vernon's Texas Code
Annotated) are specifically declared by the parties hereto not to be
applicable to this Agreement or any of the other Loan Documents or to the
transactions contemplated hereby.
SECTION 12.15. NO ORAL AGREEMENTS.
THIS AGREEMENT, THE NOTES, ANY SEPARATE
LETTER AGREEMENTS WITH RESPECT TO FEES PAYABLE TO THE ADMINISTRATIVE AGENT,
AND THE OTHER LOAN DOCUMENTS REFERRED TO HEREIN REPRESENT THE FINAL
AGREEMENT AMONG THE PARTIES HERETO AND MAY NOT BE CONTRADICTED OR VARIED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES
HERETO.
SECTION 12.16. No Fiduciary Relationship.
The relationship between the Borrower
and each Lender and the Issuing Bank with respect to the Loan Documents and
the Transactions is solely that of debtor and creditor, and neither the
Administrative Agent, the Issuing Bank nor any Lender has any fiduciary or
other special relationship with the Borrower with respect to the Loan
Documents and the Transactions, and no term or condition of any of the Loan
Documents shall be construed so as to deem the relationship between the
Borrower and any Lender or the Issuing Bank with respect to the Loan
Documents and the Transactions to be other than that of debtor and creditor.
SECTION 12.17. Construction.
The Borrower, the Administrative Agent, the Issuing
Bank and each Lender acknowledge that each of them has had the benefit of
legal counsel of its own choice and has been afforded an opportunity to
review this Agreement and the other Loan Documents with its legal counsel
and that this Agreement and the other Loan Documents shall be construed as
if jointly drafted by the parties hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
[Remainder of this page intentionally left blank]
[Signature Pages Follow]
PEGASUS SOLUTIONS, INC.
By:
Name:
Title:
THE CHASE MANHATTAN BANK,
as successor to CHASE BANK OF TEXAS,
NATIONAL ASSOCIATION, individually
and as Administrative Agent
By:
Name:
Title:
▇▇▇▇▇ FARGO BANK TEXAS,
NATIONAL ASSOCIATION
By:
Name:
Title:
COMPASS BANK
By:
Name:
Title:
THE CHASE MANHATTAN BANK,
as Issuing Lender
By:
Name:
Title:
Guarantors hereby consent and agree to the Amended and Restated Credit
Agreement and agree that the Guaranty Agreement dated as of April 17, 2000,
shall remain in full force and effect and shall continue to be the legal,
valid and binding obligation of each Guarantor enforceable against each
Guarantor in accordance with its terms.
PEGASUS NO. 1, LLC
By:
Name:
Title:
PEGASUS NO. 2, LLC
By:
Name:
Title:
PEGASUS GP, LLC
By: Pegasus Solutions, Inc., its Sole Member
By:
Name:
Title:
PEGASUS BUSINESS INTELLIGENCE, LP,
(successor by merger to Pegasus Electronic
Distribution, LP and Pegasus Commission
Processing, LP)
By: Pegasus GP, LLC, its General Partner
By:Pegasus Solutions, Inc., its Sole Member
By:
Name:
Title:
PEGASUS SOLUTIONS ACQUISITION
COMPANY (formerly known as REZ, Inc.)
By:
Name:
Title:
PEGASUS SOLUTIONS COMPANIES
(successor by merger to Anasazi Service
Corporation and Anasazi Travel Resources, Inc.
and formerly known as Rezolutions, Inc.)
By:
Name:
Title:
INDEX TO EXHIBITS
Exhibit Description of Exhibits
"A" Form of Note
"B" Borrowing Request Form
"C" Security Agreement
"D" Guaranty
"E" Contribution and Indemnification
Agreement
"F" Matters to be Addressed in
Opinion of Counsel
"G" Compliance Certificate
"H" Assignment and Acceptance
INDEX TO SCHEDULES
Schedule Description of Schedules
1.01 Investment Policy
2.01 Lenders and Commitments
5.06 Disclosed Matters
5.14 Subsidiaries
5.16 Patents, Trademarks and
Copyrights
8.01 Existing Indebtedness
8.02 Existing Liens
8.08 Existing Restrictive
Agreements