Exhibit 10.1
EXECUTION COPY
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CREDIT AGREEMENT
Dated as of April 5, 2006,
among
UICI,
as Holdings,
HEALTHMARKETS, LLC,
as the Borrower,
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent and L/C Issuer,
THE OTHER LENDERS PARTY HERETO and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING INC.,
as Syndication Agent,
▇▇▇▇▇▇▇ SACHS CREDIT PARTNERS L.P.,
as Documentation Agent,
▇.▇.▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
SECURITIES INC. SENIOR FUNDING INC. CREDIT PARTNERS L.P.
as Joint Lead Arrangers,
▇.▇. ▇▇▇▇▇▇ SECURITIES INC. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING INC.
as Joint Bookrunners
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TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Defined Terms...................................................1
SECTION 1.02. Other Interpretive Provisions..................................41
SECTION 1.03. Accounting Terms...............................................42
SECTION 1.04. Rounding.......................................................42
SECTION 1.05. References to Agreements, Laws, Etc............................42
SECTION 1.06. Times of Day...................................................43
SECTION 1.07. Timing of Payment of Performance...............................43
ARTICLE II
THE COMMITMENTS AND CREDIT EXTENSIONS
SECTION 2.01. The Loans......................................................43
SECTION 2.02. Borrowings, Conversions and Continuations of Loans.............43
SECTION 2.03. Letters of Credit..............................................45
SECTION 2.04. [Reserved].....................................................53
SECTION 2.05. Prepayments....................................................53
SECTION 2.06. Termination or Reduction of Commitments........................55
SECTION 2.07. Repayment of Loans.............................................56
SECTION 2.08. Interest.......................................................56
SECTION 2.09. Fees...........................................................57
SECTION 2.10. Computation of Interest and Fees...............................57
SECTION 2.11. Evidence of Indebtedness.......................................57
SECTION 2.12. Payments Generally.............................................58
SECTION 2.13. Sharing of Payments............................................60
SECTION 2.14. Incremental Credit Extensions..................................61
ARTICLE III
TAXES, INCREASED COSTS PROTECTION AND ILLEGALITY
SECTION 3.01. Taxes..........................................................62
SECTION 3.02. Illegality.....................................................65
SECTION 3.03. Inability To Determine Rates...................................65
SECTION 3.04. Increased Cost and Reduced Return; Capital Adequacy;
Reserves on Eurocurrency Rate Loans..........................66
SECTION 3.05. Funding Losses.................................................67
SECTION 3.06. Matters Applicable to All Requests for Compensation............68
SECTION 3.07. Replacement of Lenders under Certain Circumstances.............69
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SECTION 3.08. Survival.......................................................70
ARTICLE IV
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS
SECTION 4.01. Conditions of Initial Credit Extension.........................70
SECTION 4.02. Conditions to All Credit Extensions............................72
ARTICLE V
REPRESENTATIONS AND WARRANTIES
SECTION 5.01. Existence, Qualification and Power; Compliance with
Laws.........................................................73
SECTION 5.02. Authorization; No Contravention................................73
SECTION 5.03. Governmental Authorization; Other Consents.....................74
SECTION 5.04. Binding Effect.................................................74
SECTION 5.05. Financial Statements; No Material Adverse Effect. (a)..........74
SECTION 5.06. Litigation.....................................................75
SECTION 5.07. No Default.....................................................75
SECTION 5.08. Ownership of Property; Liens...................................75
SECTION 5.09. Environmental Compliance.......................................76
SECTION 5.10. Taxes..........................................................76
SECTION 5.11. ERISA Compliance...............................................76
SECTION 5.12. Subsidiaries; Equity Interests.................................76
SECTION 5.13. Margin Regulations; Investment Company Act.....................77
SECTION 5.14. Disclosure.....................................................77
SECTION 5.15. Intellectual Property; Licenses, Etc...........................77
SECTION 5.16. Solvency.......................................................78
SECTION 5.17. Subordination of Junior Financing..............................78
SECTION 5.18. Labor Matters..................................................78
ARTICLE VI
AFFIRMATIVE COVENANTS
SECTION 6.01. Financial Statements...........................................78
SECTION 6.02. Certificates; Other Information................................80
SECTION 6.03. Notices........................................................82
SECTION 6.04. Payment of Obligations.........................................82
SECTION 6.05. Preservation of Existence, Etc.................................83
SECTION 6.06. Maintenance of Properties......................................83
SECTION 6.07. Maintenance of Insurance.......................................83
SECTION 6.08. Compliance with Laws...........................................83
SECTION 6.09. Books and Records..............................................83
SECTION 6.10. Inspection Rights..............................................84
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SECTION 6.11. Covenant To Guarantee Obligations and Give Security............84
SECTION 6.12. Compliance with Environmental Laws.............................85
SECTION 6.13. Further Assurances and Post-Closing Conditions.................86
SECTION 6.14. Designation of Subsidiaries....................................86
SECTION 6.15. Collateral Release.............................................86
SECTION 6.16. Rating of Facilities...........................................87
SECTION 6.17. Use of Proceeds................................................87
ARTICLE VII
NEGATIVE COVENANTS
SECTION 7.01. Liens..........................................................87
SECTION 7.02. Investments....................................................90
SECTION 7.03. Indebtedness...................................................93
SECTION 7.04. Fundamental Changes............................................96
SECTION 7.05. Dispositions...................................................97
SECTION 7.06. Restricted Payments...........................................100
SECTION 7.07. Change in Nature of Business..................................102
SECTION 7.08. Transactions with Affiliates..................................102
SECTION 7.09. Financial Covenants...........................................103
SECTION 7.10. Accounting Changes............................................103
SECTION 7.11. Equity Interests of the Borrower and Restricted
Subsidiaries................................................103
ARTICLE VIIA
HOLDINGS COVENANT
ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES
SECTION 8.01. Events of Default.............................................104
SECTION 8.02. Remedies Upon Event of Default................................106
SECTION 8.03. Application of Funds..........................................106
SECTION 8.04. Borrower's Right to Cure......................................107
SECTION 8.05. Exclusion of Immaterial Subsidiaries..........................108
ARTICLE IX
ADMINISTRATIVE AGENT AND OTHER AGENTS
SECTION 9.01. Appointment and Authorization of Agents.......................108
SECTION 9.02. Delegation of Duties..........................................109
SECTION 9.03. Liability of Agents...........................................109
SECTION 9.04. Reliance by Agents............................................110
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SECTION 9.05. Notice of Default.............................................110
SECTION 9.06. Credit Decision; Disclosure of Information by Agents..........111
SECTION 9.07. Indemnification of Agents.....................................111
SECTION 9.08. Agents in Their Individual Capacities.........................112
SECTION 9.09. Successor Agents..............................................112
SECTION 9.10. Administrative Agent May File Proofs of Claim.................113
SECTION 9.11. Collateral and Guaranty Matters...............................114
SECTION 9.12. Other Agents; Arrangers and Managers..........................114
SECTION 9.13. Appointment of Supplemental Administrative Agents.............115
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Amendments, etc..............................................116
SECTION 10.02. Notices and Other Communications; Facsimile Copies...........117
SECTION 10.03. No Waiver; Cumulative Remedies...............................119
SECTION 10.04. Attorney Costs, Expenses and Taxes...........................119
SECTION 10.05. Indemnification by the Borrower..............................119
SECTION 10.06. Payments Set Aside...........................................121
SECTION 10.07. Successors and Assigns.......................................121
SECTION 10.08. Confidentiality..............................................125
SECTION 10.09. Setoff.......................................................126
SECTION 10.10. Interest Rate Limitation.....................................126
SECTION 10.11. Counterparts.................................................126
SECTION 10.12. Integration..................................................127
SECTION 10.13. Survival of Representations and Warranties...................127
SECTION 10.14. Severability.................................................127
SECTION 10.15. Tax Forms....................................................127
SECTION 10.16. Governing Law................................................129
SECTION 10.17. Waiver of Right to Trial by Jury.............................130
SECTION 10.18. Binding Effect...............................................130
SECTION 10.19. Lender Action................................................130
SECTION 10.20. USA PATRIOT Act..............................................131
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SCHEDULES
I Guarantors
1.01A Certain Security Interests and Guarantees
1.01B Immaterial Subsidiaries
1.01C Existing Letters of Credit
2.01 Commitments
5.10 Taxes
5.11(a) ERISA Compliance
5.12 Subsidiaries; Equity Investments
7.01(b) Existing Liens
7.02(f) Existing Investments
7.03(b) Existing Indebtedness
7.05(l) Dispositions
7.08 Transactions with Affiliates
EXHIBITS
FORM OF
A Committed Loan Notice
B-1 Term Note
B-2 Revolving Credit Note
C Compliance Certificate
D Assignment and Assumption
E Guaranty
F Pledge Agreement
G-1 Form of Opinion of Wachtell, Lipton, ▇▇▇▇▇ & ▇▇▇▇
▇-▇ Form of Opinion of General Counsel of the Borrower
H Form of Global Intercompany Note
CREDIT AGREEMENT
This CREDIT AGREEMENT ("AGREEMENT") is entered
into as of April 5, 2006, among HealthMarkets, LLC, a
Delaware limited liability company (the "BORROWER"), UICI, a
Delaware corporation ("HOLDINGS"), JPMORGAN CHASE BANK,
N.A., as Administrative Agent and L/C Issuer, each lender
from time to time party hereto (collectively, the "LENDERS"
and individually, a "LENDER"), ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING
INC., as Syndication Agent, and ▇▇▇▇▇▇▇ SACHS CREDIT
PARTNERS L.P., as Documentation Agent.
PRELIMINARY STATEMENTS
The applicable Lenders have indicated their willingness to lend,
and the L/C Issuers have indicated their willingness to issue Letters of Credit,
in each case, on the terms and subject to the conditions set forth herein.
In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. DEFINED TERMS. As used in this Agreement, the following
terms shall have the meanings set forth below:
"ACQUIRED EBITDA" means, with respect to any Acquired Entity or
Business for any period, the amount for such period of Consolidated EBITDA of
such Acquired Entity or Business (determined as if references to the Borrower
and the Restricted Subsidiaries in the definition of Consolidated EBITDA were
references to such Acquired Entity or Business and its Subsidiaries (except to
the extent such Subsidiaries will not constitute Restricted Subsidiaries
immediately after giving effect to such acquisition)), all as determined on a
consolidated basis for such Acquired Entity or Business.
"ACQUIRED ENTITY OR BUSINESS" has the meaning set forth in the
definition of the term "Consolidated EBITDA".
"ACT" has the meaning set forth in Section 10.20.
"ADJUSTED STATUTORY SURPLUS" means, at any time, the sum of (a)
Statutory Surplus (calculated in accordance with the Statutory Statements, page
3, column 1, line 38) PLUS (b) Asset Valuation Reserve (calculated in accordance
with the Statutory Statements, page 3, column 1, line 24.1), for The MEGA Life
and Health Insurance Company, plus the like amount for Mid-West National Life
Insurance
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Company of Tennessee, plus the like amount for The Chesapeake Life
Insurance Company.
"ADMINISTRATIVE AGENT" means JPMorgan Chase Bank, in its capacity as
administrative agent under any of the Loan Documents, or any successor
administrative agent.
"ADMINISTRATIVE QUESTIONNAIRE" means an Administrative Questionnaire
in a form supplied by the Administrative Agent.
"AFFILIATE" means, with respect to any 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. "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.
"AGENT-RELATED PERSONS" means the Agents, together with their
respective Affiliates, and the officers, directors, employees, agents and
attorneys-in-fact of such Persons and Affiliates.
"AGENT STOCKHOLDERS" means any former or current independent agent of
Holdings or any of its subsidiaries who are investors in Holdings or any direct
or indirect parent thereof.
"AGENTS" means, collectively, the Administrative Agent, the
Syndication Agent and the Supplemental Administrative Agents (if any).
"AGGREGATE COMMITMENTS" means the Commitments of all the Lenders.
"AGREEMENT" means this Credit Agreement.
"APPLICABLE CREDIT RATING" means, at any time, (a) the credit rating
of the Facilities assigned to the Facilities by S&P at such time, (b) if the
Facilities shall not be rated by S&P at such time, the Borrower's corporate
credit rating assigned by S&P at such time or (c) otherwise, BB+; PROVIDED that
if at any time S&P shall no longer maintain any of the foregoing ratings, the
Administrative Agent and the Borrower shall determine the Applicable Credit
Rating using the corresponding ratings level of (x) ▇▇▇▇▇'▇ or (y) if such
ratings shall not be available from ▇▇▇▇▇'▇ for any reason, another Nationally
Recognized Statistical Rating Organization (as defined in Rule 436 under the
Securities Act of 1933) determined by the Administrative Agent in its reasonable
discretion (any rating agency described in clause (x) or (y) of this proviso, a
"REPLACEMENT RATING AGENCY").
If any rating established or deemed to have been established by S&P
(or, if applicable, a Replacement Rating Agency) shall be changed (other than as
a result of a change in the rating system of S&P or such Replacement Rating
Agency), such change shall be effective as of the date on which such change is
first announced by the rating
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agency making such change. If the rating system of S&P (or, if applicable, the
then current Replacement Rating Agency) shall change, the Borrower and the
Required Lenders shall negotiate in good faith to amend the definitions of
"Collateral Release Period" and "Non-Investment Grade Period" to reflect such
changed rating system or the non-availability of ratings from S&P (or such
Replacement Rating Agency) and, pending the effectiveness of any such amendment,
the Applicable Credit Rating shall be determined by reference to the rating most
recently in effect from S&P (or such Replacement Rating Agency) prior to such
change.
If an Applicable Credit Rating shall not be available from S&P (or, if
applicable, the then current Replacement Rating Agency) and the Administrative
Agent shall have designated a Replacement Rating Agency, then the Borrower and
the Required Lenders shall negotiate in good faith to amend the definitions of
"Collateral Release Period" and "Non-Investment Grade Period" to reflect such
Replacement Rating Agency. Pending the appointment of a Replacement Rating
Agency and the effectiveness of any such amendment, the Applicable Credit
Rating, Collateral Release Period and Non-Investment Grade Period shall be
determined by reference to the rating most recently in effect prior to such
unavailability.
"APPLICABLE INSURANCE REGULATORY AUTHORITY" means, when used with
respect to any Insurance Subsidiary, the insurance department or similar
administrative authority or agency located in (a) each state, the Turks & Caicos
Islands or any other jurisdiction in which the Insurance Subsidiary is domiciled
or (b) to the extent asserting regulatory jurisdiction over such Insurance
Subsidiary, the insurance department, authority or agency in each state, the
Turks & Caicos Islands or any other jurisdiction in which such Insurance Company
is licensed, and shall include any Federal insurance regulatory department,
authority or agency that may be created and that asserts regulatory jurisdiction
over such Insurance Subsidiary.
"APPLICABLE RATE" means, with respect to the Eurocurrency Rate, 1.00%
per annum, with respect to the Base Rate, 0.00% per annum, and with respect to
the Commitment Fee Rate, 0.25% per annum.
"APPROVED BANK" has the meaning specified in clause (b) of the
definition of "Cash Equivalents".
"APPROVED FUND" means any Fund that is administered, advised or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers, advises or manages a Lender.
"ARRANGERS" means (a) ▇.▇. ▇▇▇▇▇▇ Securities Inc. and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Senior Funding Inc., each in its capacity as a Joint Bookrunner and a Joint Lead
Arranger under this Agreement, and (b) ▇▇▇▇▇▇▇ Sachs Credit Partners L.P., in
its capacity as a Joint Lead Arranger under this Agreement.
"ASSIGNEES" has the meaning specified in Section 10.07(b).
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"ASSIGNMENT AND ASSUMPTION" means an Assignment and Assumption
substantially in the form of Exhibit D.
"ATTORNEY COSTS" means and includes all reasonable fees, expenses and
disbursements of any law firm or other external legal counsel.
"ATTRIBUTABLE INDEBTEDNESS" means, on any date, in respect of any
Capitalized Lease of any Person, the capitalized amount thereof that would
appear on a balance sheet of such Person prepared as of such date in accordance
with GAAP.
"AUDITED FINANCIAL STATEMENTS" means (a) the audited consolidated
balance sheets of the Company and its Subsidiaries as of each of December 31,
2005, and 2004, (b) the related audited consolidated statements of income,
stockholders' equity and cash flows for the Company and its Subsidiaries for the
fiscal years ended December 31, 2005, 2004 and 2003 and (c) the related
consolidating balance sheet and income statement of the Company and its
Subsidiaries, as of, and for the fiscal years ended, December 31, 2005, 2004 and
2003.
"AUTO-RENEWAL LETTER OF CREDIT" has the meaning specified in Section
2.03(b)(iii).
"BASE RATE" means for any day a fluctuating rate per annum equal to
the higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of
interest in effect for such day as publicly announced from time to time by
JPMorgan Chase Bank as its "prime rate". The "prime rate" is a rate set by
JPMorgan Chase Bank based upon various factors including JPMorgan Chase Bank
costs and desired return, general economic conditions and other factors, and is
used as a reference point for pricing some loans, which may be priced at, above,
or below such announced rate. Any change in such rate announced by JPMorgan
Chase Bank shall take effect at the opening of business on the day specified in
the public announcement of such change.
"BASE RATE LOAN" means a Loan that bears interest based on the Base
Rate.
"BLACKSTONE INVESTORS" means The Blackstone Group and its Affiliates,
but not including, however, any portfolio companies of any of the foregoing.
"BORROWER" has the meaning set forth in the introductory paragraph to
this Agreement.
"BORROWER NET INCOME" means, for any period, the Consolidated Net
Income for such period; PROVIDED that the phrase "Borrower on a stand-alone
basis" shall be substituted for "Borrower and the Restricted Subsidiaries" in
such definition.
"BORROWING" means a Revolving Credit Borrowing or a Term Borrowing, as
the context may require.
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"BUSINESS DAY" means any day other than a Saturday, Sunday or other
day on which commercial banks are authorized to close under the Laws of, or are
in fact closed in, New York City and if such day relates to any interest rate
settings as to a Eurocurrency Rate Loan, any fundings, disbursements,
settlements or payments in respect of any such Eurocurrency Rate Loan, or any
other dealings to be carried out pursuant to this Agreement in respect of any
such Eurocurrency Rate Loan, means any such day on which dealings in deposits in
U.S. dollars are conducted by and between banks in the London interbank
eurodollar market.
"CAPITAL EXPENDITURES" means, for any period, the aggregate, without
duplication, of (a) all expenditures (whether paid in cash or accrued as
liabilities) by the Borrower and the Restricted Subsidiaries during such period
that, in conformity with GAAP, are or are required to be included as additions
during such period to property, plant or equipment reflected in the consolidated
balance sheet of the Borrower and the Restricted Subsidiaries and (b) the value
of all assets under Capitalized Leases incurred by the Borrower and the
Restricted Subsidiaries during such period; PROVIDED that the term "Capital
Expenditures" shall not include (i) expenditures made in connection with the
replacement, substitution, restoration or repair of assets to the extent
financed with (x) insurance proceeds paid on account of the loss of or damage to
the assets being replaced, restored or repaired or (y) awards of compensation
arising from the taking by eminent domain or condemnation of the assets being
replaced, (ii) the purchase price of equipment that is purchased simultaneously
with the trade-in of existing equipment to the extent that the gross amount of
such purchase price is reduced by the credit granted by the seller of such
equipment for the equipment being traded in at such time, (iii) expenditures
that are accounted for as capital expenditures by the Borrower or any Restricted
Subsidiary and that actually are paid for by a Person other than the Borrower or
any Restricted Subsidiary and for which neither the Borrower nor any Restricted
Subsidiary has provided or is required to provide or incur, directly or
indirectly, any consideration or obligation to such Person or any other Person
(whether before, during or after such period), (iv) the book value of any asset
owned by the Borrower or any Restricted Subsidiary prior to or during such
period to the extent that such book value is included as a capital expenditure
during such period as a result of such Person reusing or beginning to reuse such
asset during such period without a corresponding expenditure actually having
been made in such period; PROVIDED that (x) any expenditure necessary in order
to permit such asset to be reused shall be included as a Capital Expenditure
during the period in which such expenditure actually is made and (y) such book
value shall have been included in Capital Expenditures when such asset was
originally acquired, or (v) expenditures that constitute Permitted Acquisitions.
"CAPITALIZED LEASES" means all leases that have been or should be, in
accordance with GAAP, recorded as capitalized leases; PROVIDED that for all
purposes hereunder the amount of obligations under any Capitalized Lease shall
be the amount thereof accounted for as a liability in accordance with GAAP.
"CASH COLLATERAL" has the meaning specified in Section 2.03(g).
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"CASH COLLATERAL ACCOUNT" means a blocked account at JPMorgan Chase
Bank (or another commercial bank selected in compliance with Section 9.09) in
the name of the Administrative Agent and under the sole dominion and control of
the Administrative Agent, and otherwise established in a manner satisfactory to
the Administrative Agent.
"CASH COLLATERALIZE" has the meaning specified in Section 2.03(g).
"CASH CONTRIBUTION" means the cash contribution by the Investors to
the Merger Cos described in the Information Memorandum dated March 2006.
"CASH EQUIVALENTS" means any of the following types of Investments, to
the extent owned by the Borrower or any Restricted Subsidiary:
(a) readily marketable obligations issued or directly and
fully guaranteed or insured by the government or any agency or
instrumentality of the United States having average maturities of not
more than 12 months from the date of acquisition thereof; PROVIDED
that the full faith and credit of the United States is pledged in
support thereof;
(b) time deposits with, or insured certificates of deposit
or bankers' acceptances of, any commercial bank that (i) is a Lender
or (ii) (A) is organized under the Laws of the United States, any
state thereof, the District of Columbia or any member nation of the
Organization for Economic Cooperation and Development or is the
principal banking Subsidiary of a bank holding company organized under
the Laws of the United States, any state thereof, the District of
Columbia or any member nation of the Organization for Economic
Cooperation and Development, and is a member of the Federal Reserve
System, and (B) has combined capital and surplus of at least
$250,000,000 (any such bank in the foregoing clauses (i) or (ii) being
an "APPROVED BANK"), in each case with average maturities of not more
than 12 months from the date of acquisition thereof;
(c) commercial paper and variable or fixed rate notes issued by an
Approved Bank (or by the parent company thereof) or any variable or
fixed rate note issued by, or guaranteed by, a corporation rated A-2
(or the equivalent thereof) or better by S&P or P-2 (or the equivalent
thereof) or better by ▇▇▇▇▇'▇, in each case with average maturities of
not more than 12 months from the date of acquisition thereof;
(d) repurchase agreements entered into by any Person with a
bank or trust company (including any of the Lenders) or recognized
securities dealer, in each case, having capital and surplus in excess
of $250,000,000 for direct obligations issued by or fully guaranteed
or insured by the government or any agency or instrumentality of the
United States, in which such Person shall have a perfected first
priority security interest (subject to no other Liens) and having, on
the date of
7
purchase thereof, a fair market value of at least 100% of the amount
of the repurchase obligations;
(e) securities with average maturities of 12 months or less
from the date of acquisition issued or fully guaranteed by any state,
commonwealth or territory of the United States, by any political
subdivision or taxing authority of any such state, commonwealth or
territory having an investment grade rating from either S&P or ▇▇▇▇▇'▇
(or the equivalent thereof);
(f) Investments with average maturities of 12 months or less
from the date of acquisition in money market funds rated AAA- (or the
equivalent thereof) or better by S&P or Aaa3 (or the equivalent
thereof) or better by ▇▇▇▇▇'▇;
(g) instruments equivalent to those referred to in clauses
(a) through (f) above denominated in any foreign currency comparable
in credit quality and tenor to those referred to above and customarily
used by corporations for cash management purposes in any jurisdiction
outside the United States to the extent reasonably required in
connection with any business conducted by any Restricted Subsidiary
organized or operating in such jurisdiction;
(h) Investments, classified in accordance with GAAP as
current assets of the Borrower or any Restricted Subsidiary, in money
market investment programs which are registered under the Investment
Company Act of 1940 or which are administered by financial
institutions having capital of at least $250,000,000, and, in either
case, the portfolios of which are limited such that substantially all
of such investments are of the character, quality and maturity
described in clauses (a) through (g) of this definition; and
(i) in the case of any Insurance Subsidiary, any Investment
with a maturity of more than 12 months that would constitute Cash
Equivalents of the kind described in any of clauses (a) through (h) of
this definition if the maturity of such Investment was 12 months or
less; PROVIDED that (1) such Investment is made with the purpose of
satisfying future contingent obligations arising out of the Borrower's
self-insurance program and (2) the maturity of such Investment is not
more than 12 months later than the estimated date of payment of such
contingent liabilities measured at the date of such Investment.
"CASH MANAGEMENT OBLIGATIONS" means obligations owed by Holdings, the
Borrower or any Restricted Subsidiary to any Lender or any Affiliate of a Lender
in respect of any overdraft and related liabilities arising from treasury,
depository and cash management services or any automated clearing house
transfers of funds.
"CASUALTY EVENT" means any event that gives rise to the receipt by
Holdings, the Borrower or any Restricted Subsidiary of any insurance proceeds or
condemnation awards, in each case in respect of any equipment, fixed assets or
real property (including any improvements thereon) to replace or repair such
equipment, fixed assets or real property.
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"CHANGE OF CONTROL" means:
(a) the acquisition of ownership, directly or indirectly,
beneficially or of record, by any Person at any time prior to the
consummation of a Qualifying IPO of the Borrower, other than Holdings,
of any Equity Interest in the Borrower,
(b) at any time prior to the consummation of a Qualifying IPO,
and for any reason whatsoever, the failure by the Permitted Holders to
have the power, directly or indirectly, to vote or direct the voting of
securities having a majority of the ordinary voting power for the
election of directors of Holdings, or
(c) at any time after the consummation of a Qualifying IPO, and
for any reason whatsoever, (i) any "person" or "group" (as such terms
are used in Sections 13(d) and 14(d) of the Exchange Act, but excluding
any employee benefit plan of such person and its Subsidiaries, and any
person or entity acting in its capacity as trustee, agent or other
fiduciary or administrator of any such plan), excluding the Permitted
Holders, shall become the "beneficial owner" (as defined in Rules
13(d)-3 and 13(d)-5 under such Act), directly or indirectly, of more
than the greater of (x) thirty-five percent (35%) of the shares
outstanding of Holdings (or the Borrower after the consummation of a
Qualifying IPO of the Borrower) and (y) the percentage of the then
outstanding voting stock of Holdings (or the Borrower after the
consummation of a Qualifying IPO of the Borrower) owned, directly or
indirectly, beneficially by the Permitted Holders, or (ii) the board of
directors of Holdings (or the Borrower after the consummation of a
Qualifying IPO of the Borrower) shall fail to consist of a majority of
Continuing Directors.
"CLASS" (a) when used with respect to Lenders, refers to whether such
Lenders are Revolving Credit Lenders or Term Lenders, (b) when used with respect
to Commitments, refers to whether such Commitments are Revolving Credit
Commitments or Term Commitments and (c) when used with respect to Loans or a
Borrowing, refers to whether such Loans, or the Loans comprising such Borrowing,
are Revolving Credit Loans or Term Loans.
"CLOSING DATE" means the first date all the conditions precedent in
Section 4.01 are satisfied or waived in accordance with Section 4.01.
"CODE" means the U.S. Internal Revenue Code of 1986 and rules and
regulations related thereto.
"COLLATERAL" means all the "Collateral" as defined in any Collateral
Document.
"COLLATERAL AGENT" means JPMorgan Chase Bank, in its capacity as
collateral agent under any of the Loan Documents, or any successor
administrative agent.
"COLLATERAL AND GUARANTEE REQUIREMENT" means, at any time, the
requirement that:
9
(a) the Administrative Agent shall have received each Collateral
Document required to be delivered pursuant to Section 4.01(a)(iii) on the
Closing Date or pursuant to Section 6.11 at such time, duly executed by each
Loan Party thereto;
(b) all Obligations shall have been unconditionally guaranteed (the
"GUARANTEES") by Holdings and each Restricted Subsidiary that is a Domestic
Subsidiary and not an Excluded Subsidiary (each, a "GUARANTOR");
(c) all guarantees issued or to be issued in respect of the Qualified
Trust Preferred Securities or any other trust preferred securities issued on or
after the Closing Date (i) by the Borrower, shall be subordinated to the
Obligations to the same extent that the Junior Subordinated Notes are
subordinated to the Obligations, and (ii) by a Subsidiary Guarantor, if any,
shall be subordinated to the Guarantees to the same extent that the Junior
Subordinated Notes are subordinated to the Obligations;
(d) the Obligations and the Guarantees shall have been secured by a
first-priority security interest in (i) all the Equity Interests of the Borrower
and (ii) all Equity Interests of each wholly owned Subsidiary directly owned by
the Borrower or any Guarantor; PROVIDED that pledges of Equity Interests of each
Foreign Subsidiary shall be limited to 65% of the issued and outstanding Equity
Interests of such Foreign Subsidiary at any time; and
(e) none of the Collateral shall be subject to any Liens other than
Liens permitted by Section 7.01.
The foregoing definition shall not require the creation or perfection
of pledges of or security interests in particular Equity Interests if and for so
long as, in the reasonable judgment of the Administrative Agent (confirmed in
writing by notice to the Borrower), the cost of creating or perfecting such
pledges or security interests in such Equity Interests shall be excessive in
view of the benefits to be obtained by the Lenders therefrom. The Administrative
Agent may grant extensions of time for the perfection of security interests in
particular Equity Interests (including extensions beyond the Closing Date) where
it reasonably determines, in consultation with the Borrower, that perfection
cannot be accomplished without undue effort or expense by the time or times at
which it would otherwise be required by this Agreement or the Collateral
Documents.
Notwithstanding the foregoing provisions of this definition or
anything in this Agreement or any other Loan Document to the contrary, Liens
required to be granted from time to time pursuant to the Collateral and
Guarantee Requirement shall be subject to exceptions and limitations set forth
in the Collateral Documents as in effect on the Closing Date and, to the extent
appropriate in the applicable jurisdiction, as agreed between the Administrative
Agent and the Borrower.
"COLLATERAL DOCUMENTS" means, collectively, the Pledge Agreement,
Pledge Agreement Supplements or other similar agreements delivered to the
Administrative Agent and the Lenders pursuant to Section 6.11, 6.13 or 6.15, the
Guaranty and each of the other agreements, instruments or documents that creates
or
10
purports to create a Lien or Guarantee in favor of the Administrative Agent for
the benefit of the Secured Parties.
"COLLATERAL RELEASE PERIOD" shall mean any period during which the
Applicable Credit Rating is at least BBB-. Each Collateral Release Period shall
commence upon written notice by the Borrower to the Administrative Agent and
shall terminate on the first date following the commencement of such Collateral
Release Period on which the Applicable Credit Rating is not at least BBB-.
"COMPANY" means UICI, a Delaware corporation, prior to the
consummation of the Mergers.
"COMMITMENT" means a Term Commitment or a Revolving Credit Commitment,
as the context may require.
"COMMITTED LOAN NOTICE" means a notice of (a) a Term Borrowing, (b) a
Revolving Credit Borrowing, (c) a conversion of Loans from one Type to the
other, or (d) a continuation of Eurocurrency Rate Loans, pursuant to Section
2.02(a), which, if in writing, shall be substantially in the form of Exhibit A.
"COMPENSATION PERIOD" has the meaning specified in Section
2.12(c)(ii).
"COMPLIANCE CERTIFICATE" means a certificate substantially in the form
of Exhibit C.
"CONSOLIDATED EBITDA" means, for any period, the Consolidated Net
Income for such period, PLUS:
(a) without duplication and, except with respect to clause (x) below,
to the extent already deducted (and not added back) in arriving at such
Consolidated Net Income, the sum of the following amounts for such period:
(i) total interest expense and, to the extent not reflected in
such total interest expense, any expenses and losses on hedging
obligations or other derivative instruments entered into for the purpose
of hedging interest rate risk, net of any income and gains on such
hedging obligations, and costs of surety bonds in connection with
financing activities,
(ii) provision for taxes based on income, profits or capital of the
Borrower and the Restricted Subsidiaries, including state, premium,
franchise and similar taxes and foreign withholding Taxes paid or
accrued during such period,
(iii) depreciation and amortization,
(iv) Non-Cash Charges,
(v) unusual or non-recurring charges, severance costs, relocation
costs, charges related to regulatory investigations (and litigation
related thereto), and
11
curtailments or modifications to pension and post-retirement employee
benefit plans,
(vi) restructuring charges or restructuring reserves (including
restructuring costs related to acquisitions after the date hereof and to
closure/consolidation of facilities),
(vii) any deductions attributable to minority interests (excluding
dividends and other distributions paid in cash to the holders of such
minority interests),
(viii) the amount of management, monitoring, transaction, consulting
and advisory fees and related expenses paid to the Investors (and any
accruals related to such fees and related expenses),
(ix) any costs or expenses incurred pursuant to any management,
agent or employee equity or equity-based plan,
(x) the amount of net cost savings projected by the Borrower in
good faith to be realized as a result of specified actions taken during
such period (calculated on a pro forma basis as though such cost savings
had been realized on the first day of such period), net of the amount of
actual benefits realized during such period from such actions, PROVIDED
that (A) such cost savings are reasonably identifiable and factually
supportable, (B) such actions are taken within 24 months after the
Closing Date, (C) no cost savings shall be added pursuant to this clause
(x) to the extent duplicative of any expenses or charges relating to
such cost savings that are included in clause (vi) above with respect to
such period and (D) the aggregate amount of cost savings added pursuant
to this clause (x) shall not exceed $30,000,000 for any period
consisting of four consecutive quarters, and, LESS
(b) without duplication and to the extent included in arriving at such
Consolidated Net Income, the sum of the following amounts for such period:
(i) unusual or non-recurring income or gains,
(ii) non-cash gains (excluding any non-cash gain to the extent it
represents the reversal of an accrual or reserve for a potential cash
item that reduced Consolidated EBITDA in any prior period),
(iii) gains on asset sales (other than asset sales in the ordinary
course of business), and
(iv) all income from investments recorded using the equity method
to the extent that the declaration or payment of dividends or other
distributions in cash by the relevant entity is not at the time
permitted by Law or any agreement or instrument applicable to the
relevant entity,
12
in each case, as determined on a consolidated basis for the Borrower and
the Restricted Subsidiaries in accordance with GAAP; PROVIDED that, to the
extent included in Consolidated Net Income,
(i) there shall be excluded in determining Consolidated EBITDA for
any period any adjustments resulting from the application of Statement
of Financial Accounting Standards No. 133, and
(ii) there shall be included in determining Consolidated EBITDA for
any period, without duplication, (A) the Acquired EBITDA of any Person,
property, business or asset acquired by the Borrower or any Restricted
Subsidiary during such period (but not the Acquired EBITDA of any
related Person, property, business or assets to the extent not so
acquired), to the extent not subsequently sold, transferred or otherwise
disposed of by the Borrower or such Restricted Subsidiary (each such
Person, property, business or asset acquired and not subsequently so
disposed of, an "ACQUIRED ENTITY OR BUSINESS"), based on the actual
Acquired EBITDA of such Acquired Entity or Business for such period
(including the portion thereof occurring prior to such acquisition), (B)
for the purposes of the definition of the term "Permitted Acquisition"
and Section 7.09, an adjustment in respect of each Acquired Entity or
Business equal to the amount of the Pro Forma Adjustment with respect to
such Acquired Entity or Business for such period (including the portion
thereof occurring prior to such acquisition) as specified in a
certificate executed by a Responsible Officer of the Borrower and
delivered to the Lenders and the Administrative Agent and (C) for
purposes of determining the Total Leverage Ratio only, there shall be
excluded in determining Consolidated EBITDA for any period the Disposed
EBITDA of any Person, property, business or asset sold, transferred or
otherwise disposed of, closed or classified as discontinued operations
by the Borrower or any Restricted Subsidiary during such period (each
such Person, property, business or asset so sold or disposed of, a "SOLD
ENTITY OR BUSINESS"), based on the actual Disposed EBITDA of such Sold
Entity or Business for such period (including the portion thereof
occurring prior to such sale, transfer or disposition).
In addition, Consolidated EBITDA shall be calculated without giving effect to
(a) any gain or loss recognized in determining Consolidated Net Income for such
period in respect of post-retirement benefits as a result of the application of
Statement of Financial Accounting Standards No. 106 and (b) any gain or loss
recognized in determining Consolidated Net Income for such period resulting from
the payment of earn-out obligations permitted under Section 7.02. For the
purpose of the definition of Consolidated EBITDA, "NON-CASH CHARGES" means (a)
losses on asset sales, disposals or abandonments, (b) any impairment charge or
asset write-off related to intangible assets, long-lived assets, and investments
in debt and equity securities pursuant to GAAP, (c) all losses from investments
recorded using the equity method, (d) stock-based awards compensation expense
and (e) other non-cash charges (but excluding any such charge that consists of
or requires an accrual of, or cash reserve for, anticipated cash charges in a
future period and write-offs or write-downs of accounts receivable that
increased Consolidated EBITDA in a prior period).
13
"CONSOLIDATED NET INCOME" means, for any period, (i) the net income
(loss) of the Borrower and the Restricted Subsidiaries for such period
determined on a consolidated basis in accordance with GAAP, excluding, without
duplication, (a) extraordinary items for such period, (b) the cumulative effect
of a change in accounting principles during such period to the extent included
in Consolidated Net Income, (c) in the case of any period that includes a period
ending prior to or during the fiscal year ending December 31, 2006, Transaction
Expenses, (d) any fees and expenses incurred during such period, or any
amortization or write-off thereof for such period, in connection with any
acquisition, investment, asset disposition, issuance or repayment of debt,
issuance of equity securities, refinancing transaction or amendment or other
modification of any debt instrument (in each case, including any such
transaction consummated prior to the Closing Date and any such transaction
undertaken but not completed) and any charges or non-recurring merger costs
incurred during such period as a result of any such transaction, (e) any income
(loss) for such period attributable to the early extinguishment of Indebtedness
or hedging obligations or other derivative instruments and (f) accruals and
reserves that are established within twelve months after the Closing Date that
are so required to be established as a result of the Transaction in accordance
with GAAP, MINUS (ii) the aggregate amount of Restricted Payments made to
Holdings in reliance on Section 7.06(g)(ii) for such period. There shall be
excluded from Consolidated Net Income for any period the purchase accounting
effects of adjustments to property and equipment, other intangible assets,
deferred revenue and debt line items required or permitted by GAAP and related
authoritative pronouncements (including the effects of such adjustments pushed
down to the Borrower and the Restricted Subsidiaries), as a result of the
Transaction, any acquisition consummated prior to the Closing Date, any
Permitted Acquisitions, or the amortization or write-off of any amounts thereof.
"CONSOLIDATED TOTAL ASSETS" means, at any time, the consolidated total
assets of the Borrower and the Restricted Subsidiaries, all as set forth in the
most recent consolidated balance sheet delivered pursuant to Section 6.01 (or,
prior to any such delivery, referred to in Section 5.05), determined on a
consolidated basis in accordance with GAAP.
"CONSOLIDATED TOTAL DEBT" means, as of any date of determination, the
aggregate principal amount of (a) Indebtedness of the Borrower and the
Restricted Subsidiaries outstanding on such date, determined on a consolidated
basis in accordance with GAAP (but excluding the effects of any discounting of
Indebtedness resulting from the application of purchase accounting in connection
with the Transaction or any Permitted Acquisition), consisting of Indebtedness
for borrowed money, obligations in respect of Capitalized Leases, Disqualified
Equity Interests, debt obligations evidenced by promissory notes or similar
instruments, MINUS (b) the aggregate amount of cash held in any Cash Collateral
Account, MINUS (c) the aggregate amount of cash and Cash Equivalents of the
Borrower and the Loan Parties (other than restricted cash and Cash Equivalents
and, in each case, free and clear of all Liens, other than nonconsensual Liens
permitted by Section 7.01 and excluding the aggregate amount of Net Cash
Proceeds received by the Borrower pursuant to Section 8.04 during the preceding
four fiscal quarters that has not been used to permanently repay Indebtedness)
included in the
14
consolidated balance sheet of the Borrower and the Restricted Subsidiaries in
accordance with GAAP, MINUS (d) the aggregate principal amount of the Existing
Junior Subordinated Notes and the Junior Subordinated Notes (or any Permitted
Refinancing thereof) outstanding on such date, MINUS (e) the aggregate amount of
Indebtedness under any Student Loan Credit Facility outstanding on such date.
"CONTINUING DIRECTORS" means the directors of Holdings on the Closing
Date, as elected or appointed after giving effect to the Mergers and the other
transactions contemplated hereby, and each other director, if, in each case,
such other directors' nomination for election to the board of directors of
Holdings (or the Borrower after consummation of a Qualifying IPO of the
Borrower) is recommended by a majority of the then Continuing Directors or such
other director receives the vote of the Permitted Holders in his or her election
by the stockholders of Holdings (or the Borrower after consummation of a
Qualifying IPO of the Borrower).
"CONTRACT CONSIDERATION" has the meaning set forth in the definition
of "Excess Cash Flow".
"CONTRACTUAL OBLIGATION" means, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"CONTROL" has the meaning specified in the definition of "Affiliate".
"CREDIT EXTENSION" means each of the following: (a) a Borrowing and
(b) an L/C Credit Extension.
"DEBTOR RELIEF LAWS" means the Bankruptcy Code of the United States,
and all other liquidation, conservatorship, bankruptcy, assignment for the
benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights of
creditors generally.
"DEFAULT" means any event or condition that constitutes an Event of
Default or that, with the giving of any notice, the passage of time, or both,
would be an Event of Default.
"DEFAULT RATE" means an interest rate equal to (a) the Base Rate PLUS
(b) the Applicable Rate, if any, applicable to Base Rate Loans PLUS (c) 2.0% per
annum; PROVIDED that with respect to a Eurocurrency Rate Loan, the Default Rate
shall be an interest rate equal to the interest rate (including any Applicable
Rate) otherwise applicable to such Loan PLUS 2.0% per annum, in each case, to
the fullest extent permitted by applicable Laws.
"DEFAULTING LENDER" means any Lender that (a) has failed to fund any
portion of the Term Loans, Revolving Credit Loans or participations in L/C
Obligations required to be funded by it hereunder within one (1) Business Day of
the date required to be funded by it hereunder, unless the subject of a good
faith dispute or subsequently
15
cured, (b) has otherwise failed to pay over to the Administrative Agent or any
other Lender any other amount required to be paid by it hereunder within one (1)
Business Day of the date when due, unless the subject of a good faith dispute or
subsequently cured, or (c) has been deemed insolvent or become the subject of a
bankruptcy or insolvency proceeding.
"DESIGNATED NON-CASH CONSIDERATION" means the fair market value of
non-cash consideration received by the Borrower or a Restricted Subsidiary in
connection with a Disposition pursuant to Section 7.05(k) that is designated as
Designated Non-Cash Consideration pursuant to a certificate of a Responsible
Officer, setting forth the basis of such valuation (which amount will be reduced
by the fair market value of the portion of the non-cash consideration converted
to cash within 180 days following the consummation of the applicable
Disposition).
"DISPOSED EBITDA" means, with respect to any Sold Entity or Business
for any period, the amount for such period of Consolidated EBITDA of such Sold
Entity or Business (determined as if references to the Borrower and the
Restricted Subsidiaries in the definition of Consolidated EBITDA were references
to such Sold Entity or Business and its Subsidiaries), all as determined on a
consolidated basis for such Sold Entity or Business.
"DISPOSITION" or "DISPOSE" means the sale, transfer, license, lease or
other disposition (including any sale and leaseback transaction and any sale or
issuance of Equity Interests) of any property by any Person, including any sale,
assignment, transfer or other disposal, with or without recourse, of any notes
or accounts receivable or any rights and claims associated therewith; PROVIDED
that "Disposition" and "Dispose" shall not be deemed to include any issuance by
the Borrower of any of its Equity Interests to another Person.
"DISQUALIFIED EQUITY INTERESTS" means any Equity Interest (excluding
any Qualified Trust Preferred Securities), which, by its terms (or by the terms
of any security or other Equity Interests into which it is convertible or for
which it is exchangeable), or upon the happening of any event or condition (a)
matures or is mandatorily redeemable (other than solely for Qualified Equity
Interests), pursuant to a sinking fund obligation or otherwise (except as a
result of a change of control or asset sale so long as any rights of the holders
thereof upon the occurrence of a change of control or asset sale event shall be
subject to the prior repayment in full of the Loans and all other Obligations
that are accrued and payable and the termination of the Commitments), (b) is
redeemable at the option of the holder thereof (other than solely for Qualified
Equity Interests), in whole or in part, (c) provides for the scheduled payments
of dividends in cash, or (d) is or becomes convertible into or exchangeable for
Indebtedness or any other Equity Interests that would constitute Disqualified
Equity Interests, in each case, prior to the date that is ninety-one (91) days
after the Maturity Date of the Term Loans.
"DLJ INVESTORS" means DLJ Merchant Banking Partners IV, L.P. and its
Affiliates, but not including, however, any portfolio companies of any of the
foregoing.
16
"DOMESTIC SUBSIDIARY" means any Subsidiary that is organized under the
Laws of the United States, any state thereof or the District of Columbia.
"ELIGIBLE ASSIGNEE" means any Assignee permitted by and consented to
in accordance with Section 10.07(b).
"ENVIRONMENTAL LAWS" means any and all Federal, state, local, and
foreign statutes, Laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution, the protection of the
environment, natural resources, or, to the extent relating to exposure to
Hazardous Materials, human health or to the release of any materials into the
environment, including those related to hazardous substances or wastes, air
emissions and discharges to waste or public systems.
"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 other Loan Party or any of their
respective Subsidiaries 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.
"ENVIRONMENTAL PERMIT" means any permit, approval, identification
number, license or other authorization required under any Environmental Law.
"EQUITY CONTRIBUTION" means the Rollover Equity together with the Cash
Contribution.
"EQUITY INTERESTS" means, with respect to any Person, all of the
shares, interests, rights, participations or other equivalents (however
designated) of capital stock of (or other ownership or profit interests or units
in) such Person and all of the warrants, options or other rights for the
purchase, acquisition or exchange from such Person of any of the foregoing
(including through convertible securities).
"EQUITY INVESTORS" means, collectively, the Investors, the Management
Stockholders and the Agent Stockholders.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) that is under common control with any Loan Party within the
meaning of Section 414 of the Code or Section 4001 of ERISA.
"ERISA EVENT" means (a) a Reportable Event with respect to a Pension
Plan; (b) a withdrawal by any Loan Party or any ERISA Affiliate from a Pension
Plan subject to Section 4063 of ERISA during a plan year in which it was a
substantial
17
employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of
operations that is treated as such a withdrawal under Section 4062(e) of ERISA;
(c) a complete or partial withdrawal by any Loan Party or any ERISA Affiliate
from a Multiemployer Plan or notification that a Multiemployer Plan is in
reorganization; (d) the filing of a notice of intent to terminate, the treatment
of a Plan amendment as a termination under Sections 4041 or 4041A of ERISA, or
the commencement of proceedings by the PBGC to terminate a Pension Plan or
Multiemployer Plan; (e) an event or condition which constitutes grounds under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan or Multiemployer Plan; or (f) the imposition of any
liability under Title IV of ERISA, other than for PBGC premiums due but not
delinquent under Section 4007 of ERISA, upon any Loan Party or any ERISA
Affiliate.
"EUROCURRENCY RATE" means, for any Interest Period with respect to any
Eurocurrency Rate Loan, the rate appearing on Page 3750 of the Dow ▇▇▇▇▇ Market
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 U.S. 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 U.S.
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
"EUROCURRENCY RATE" with respect to such Eurocurrency Rate Loan for such
Interest Period shall be the rate at which U.S. dollar deposits of an amount
comparable to the amount of such Eurocurrency Rate Loan 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.
"EUROCURRENCY RATE LOAN" means a Loan that bears interest at a rate
based on the Eurocurrency Rate.
"EVENT OF DEFAULT" has the meaning specified in Section 8.01.
"EXCESS CASH FLOW" means, for any period, an amount equal to the
excess of:
(a) the sum, without duplication, of:
(i) Borrower Net Income for such period,
(ii) an amount equal to the amount of all non-cash charges to the
extent deducted in arriving at such Borrower Net Income,
(iii) decreases in assets and increases in liabilities reflected as
cash flows from operating activities on the cash flows statement of the
Borrower for such
18
period (other than any such decreases arising from acquisitions by the
Borrower and the Restricted Subsidiaries completed during such period), and
(iv) an amount equal to the aggregate net non-cash loss on
Dispositions by the Borrower during such period (other than Dispositions
in the ordinary course of business) to the extent deducted in arriving
at such Borrower Net Income; over
(b) the sum, without duplication, of:
(i) an amount equal to the amount of all non-cash credits included
in arriving at such Borrower Net Income (including equity in
undistributed earnings of Subsidiaries) and cash charges included in
clauses (a) through (e) of the definition of Consolidated Net Income (as
applied to the calculation of Borrower Net Income),
(ii) without duplication of amounts deducted pursuant to clause
(xi) below in prior fiscal years, the amount of Capital Expenditures
made in cash or accrued during such period by the Borrower, except to
the extent that such Capital Expenditures were financed with the
proceeds of Indebtedness or the issuance of, or contribution in respect
of, Equity Interests of the Borrower,
(iii) the aggregate amount of all principal payments of Indebtedness
of the Borrower (including the principal component of payments in
respect of Capitalized Leases but excluding (A) all prepayments of Term
Loans and (B) all prepayments of Revolving Credit Loans) made during
such period (other than in respect of any revolving credit facility to
the extent there is not an equivalent permanent reduction in commitments
thereunder), except to the extent financed with the proceeds of
Indebtedness or the issuance of, or contribution in respect of, Equity
Interests of the Borrower,
(iv) an amount equal to the aggregate net gain on Dispositions by
the Borrower during such period (other than Dispositions in the ordinary
course of business) to the extent included in arriving at such Borrower
Net Income,
(v) increases in assets and decreases in liabilities reflected as
cash flows from operating activities on the cash flows statement of the
Borrower for such period (other than any such increases arising from
acquisitions by the Borrower during such period),
(vi) cash payments by the Borrower during such period in respect of
long-term liabilities of the Borrower other than Indebtedness,
(vii) without duplication of amounts deducted pursuant to clause
(xi) below in prior fiscal years, the amount of Investments and
acquisitions made by the Borrower during such period pursuant to Section
7.02 (other than Section 7.02(a)), except to the extent that such
Investments and acquisitions were financed with the proceeds of
Indebtedness or the issuance of, or contribution in respect of, Equity
Interests of the Borrower,
19
(viii) the amount of Restricted Payments made by the Borrower during
such period pursuant to Section 7.06 (other than Section 7.06(g)(ii) and
Section 7.06(i)), except to the extent such Restricted Payments were
financed with the proceeds of Indebtedness or the issuance of, or
contribution in respect of, Equity Interests of the Borrower,
(ix) the aggregate amount of expenditures actually made by the
Borrower in cash during such period (including expenditures for the
payment of financing fees) to the extent that such expenditures are not
expensed during such period, except to the extent such expenditures were
financed with the proceeds of Indebtedness or the issuance of, or
contribution in respect of, Equity Interests of the Borrower,
(x) the aggregate amount of any premium, make-whole or penalty
payments actually paid in cash by the Borrower during such period that
are required to be made in connection with any prepayment of
Indebtedness,
(xi) without duplication of amounts deducted from Excess Cash Flow
in prior periods, the aggregate consideration required to be paid in
cash by the Borrower or any of the Restricted Subsidiaries pursuant to
binding contracts (the "CONTRACT CONSIDERATION") entered into prior to
or during such period relating to Permitted Acquisitions or Capital
Expenditures to be consummated or made during the period of four
consecutive fiscal quarters of the Borrower following the end of such
period, PROVIDED that to the extent the aggregate amount of cash (other
than cash proceeds of Indebtedness or the issuance of, or contribution
in respect of, Equity Interests of the Borrower) actually utilized to
finance such Permitted Acquisitions during such period of four
consecutive fiscal quarters is less than the Contract Consideration, the
amount of such shortfall shall be added to the calculation of Excess
Cash Flow at the end of such period of four consecutive fiscal quarters,
(xii) to the extent not deducted in determining Borrower Net Income
for such period, the amount of cash taxes paid or payable, directly or
indirectly, by the Borrower,
(xiii) the amount of dividends, distributions or advances made by the
Borrower during such period to fund the repurchase of agent shares,
(xiv) the amount of dividends or distributions made by any
Subsidiary to the Borrower resulting from the Dispositions permitted by
Section 7.05,
(xv) the amount of any reserve established during such period for
expenses reasonably estimated by the Borrower in good faith to be
payable within the succeeding fiscal year, PROVIDED that to the extent
any such reserve is reversed in any subsequent fiscal year, then the
amount of such reversal shall be added to the calculation of Excess Cash
Flow in such subsequent fiscal year.
"EXCHANGE ACT" means the Securities Exchange Act of 1934.
20
"EXCLUDED SUBSIDIARY" means (a) any Insurance Subsidiary, (b) any
Subsidiary that is not a wholly owned Subsidiary for so long as such Subsidiary
is not wholly owned, (c) any Immaterial Subsidiary, (d) any Subsidiary that is
prohibited by applicable Law from guaranteeing the Obligations, (e) any
statutory trust created for the purpose of issuing any trust preferred
securities, (f) the Student Loan Subsidiary and (g) any other Subsidiary with
respect to which, in the reasonable judgment of the Administrative Agent
(confirmed in writing by notice to the Borrower), the cost or other consequences
(including any adverse tax consequences) of providing a Guarantee shall be
excessive in view of the benefits to be obtained by the Lenders therefrom.
"EXCLUDED TAXES" has the meaning specified in Section 3.01(a).
"EXISTING JUNIOR SUBORDINATED NOTES" means the Borrower's Floating
Rate Junior Subordinated Notes due 2036, in an aggregate principal amount of
$15,500,000 issued on April 29, 2004, pursuant to the Existing Junior
Subordinated Notes Indenture.
"EXISTING LETTER OF CREDIT" means any letter of credit previously
issued for the account of the Borrower or any Subsidiary by JPMorgan Chase,
N.A., or its Affiliate that is (a) outstanding on the Closing Date and (b)
listed on Schedule 1.01C.
"EXISTING PREFERRED SECURITIES" means the trust preferred securities
of UICI Capital Trust 1, a Delaware statutory trust, which upon completion of
the Transaction shall be a direct subsidiary of the Borrower, issued on or about
April 29, 2004.
"EXISTING JUNIOR SUBORDINATED NOTES INDENTURE" means the Junior
Subordinated Indenture dated as of April 29, 2004, between the Company and
JPMorgan Chase Bank, a New York banking corporation, as Trustee, under which the
Existing Junior Subordinated Notes were issued.
"FACILITY" means the Term Loans, the Revolving Credit Facility or the
Letter of Credit Sublimit, as the context may require.
"FEDERAL FUNDS RATE" means, for any day, the rate per annum equal to
the weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank on the Business Day next
succeeding such day; PROVIDED that (a) if such day is not a Business Day, the
Federal Funds Rate for such day shall be such rate on such transactions on the
next preceding Business Day as so published on the next succeeding Business Day,
and (b) if no such rate is so published on such next succeeding Business Day,
the Federal Funds Rate for such day shall be the average rate (rounded upward,
if necessary, to a whole multiple of 1/100 of 1%) charged to JPMorgan Chase Bank
on such day on such transactions as determined by the Administrative Agent.
"FOREIGN LENDER" has the meaning specified in Section 10.15(a)(i).
21
"FOREIGN SUBSIDIARY" means any direct or indirect Subsidiary of the
Borrower which is not a Domestic Subsidiary.
"FRB" means the Board of Governors of the Federal Reserve System of
the United States.
"FUND" means any Person (other than a natural person) that is engaged
in making, purchasing, holding or otherwise investing in commercial loans and
similar extensions of credit in the ordinary course.
"GAAP" means generally accepted accounting principles in the United
States of America, as in effect from time to time; PROVIDED, HOWEVER, 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 Closing Date 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.
"GOLDMAN INVESTORS" means GS Capital Partners V. Fund, L.P. and its
Affiliates, but not including, however, any portfolio companies of any of the
foregoing.
"GOVERNMENTAL AUTHORITY" means any nation or government, any state or
other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
"GRANTING LENDER" has the meaning specified in Section 10.07(h).
"GUARANTEE" means, as to any Person, without duplication, (a) any
obligation, contingent or otherwise, of such Person guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other monetary obligation
payable or performable by another Person (the "PRIMARY OBLIGOR") in any manner,
whether directly or indirectly, and including any obligation of such Person,
direct or indirect, (i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness or other monetary obligation, (ii) to
purchase or lease property, securities or services for the purpose of assuring
the obligee in respect of such Indebtedness or monetary other obligation of the
payment or performance of such Indebtedness or other monetary obligation, (iii)
to maintain working capital, equity capital or any other financial statement
condition or liquidity or level of income or cash flow of the primary obligor so
as to enable the primary obligor to pay such Indebtedness or other monetary
obligation, or (iv) entered into for the purpose of assuring in any other manner
the obligee in respect of such Indebtedness or other monetary obligation of the
payment or
22
performance thereof or to protect such obligee against loss in respect thereof
(in whole or in part), or (b) any Lien on any assets of such Person securing any
Indebtedness or other monetary obligation of any other Person, whether or not
such Indebtedness or monetary other obligation is assumed by such Person (or any
right, contingent or otherwise, of any holder of such Indebtedness to obtain any
such Lien); PROVIDED, HOWEVER, that the term "Guarantee" shall not include (A)
endorsements for collection or deposit, in either case in the ordinary course of
business, or customary and reasonable indemnity obligations in effect on the
Closing Date or entered into in connection with any acquisition or disposition
of assets permitted under this Agreement (other than such obligations with
respect to Indebtedness) or (B) obligations of Insurance Subsidiaries under
Insurance Contracts, Reinsurance Agreements or Retrocession Agreements. The
amount of any Guarantee shall be deemed to be an amount equal to the stated or
determinable amount of the related primary obligation, or portion thereof, in
respect of which such Guarantee is made or, if not stated or determinable, the
maximum reasonably anticipated liability in respect thereof as determined by the
guaranteeing Person in good faith. The term "Guarantee" as a verb has a
corresponding meaning.
"GUARANTORS" has the meaning set forth in the definition of
"Collateral and Guarantee Requirement".
"GUARANTY" means, collectively, (i) the Guaranty made by Holdings and
the Subsidiary Guarantors in favor of the Administrative Agent on behalf of the
Secured Parties, substantially in the form of Exhibit E, and (ii) each other
guaranty and guaranty supplement delivered pursuant to Section 6.11.
"HAZARDOUS MATERIALS" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or 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.
"HEDGE BANK" means (a) any Person that is a Lender or an Affiliate of
a Lender at the time it enters into a Secured Hedge Agreement, in its capacity
as a party thereto, and (b) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital Services, Inc. or an
Affiliate in its capacity as a party to those certain interest rate swap
agreements assigned to the Borrower on the Closing Date.
"HOLDINGS" has the meaning set forth in the introductory paragraph to
this Agreement.
"HONOR DATE" has the meaning specified in Section 2.03(c)(i).
"IMMATERIAL SUBSIDIARY" means each Subsidiary of the Borrower that (a)
for the most recent fiscal period for which financial statements of the Borrower
have been delivered to the Administrative Agent pursuant to Section 6.01 (or,
prior to any such delivery, referred to in Section 5.05), had revenues not in
excess of 2% of the consolidated revenues of the Borrower and the Restricted
Subsidiaries and (b) as of the
23
end of such fiscal quarter, had assets not in excess of 2% of Consolidated Total
Assets, in each case as shown on the consolidating financial statements of the
Borrower for such fiscal quarter; PROVIDED that, as of the Closing Date, each
entity listed as an "Immaterial Subsidiary" on Schedule 1.01B shall be an
Immaterial Subsidiary; and PROVIDED FURTHER that the Immaterial Subsidiaries,
collectively, shall not have at any time (x) aggregate revenues in excess of 7%
of the consolidated revenues of the Borrower and the Restricted Subsidiaries or
(y) aggregate assets in excess of 7% of Consolidated Total Assets.
"INCREMENTAL AMENDMENT" has the meaning set forth in Section 2.14(a).
"INCREMENTAL FACILITY CLOSING DATE" has the meaning set forth in
Section 2.14(a).
"INCREMENTAL TERM LOANS" has the meaning set forth in Section 2.14(a).
"INDEBTEDNESS" means, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes, loan
agreements or other similar instruments;
(b) the maximum amount (after giving effect to any prior drawings
or reductions which may have been reimbursed) of all letters of credit
(including standby and commercial), bankers' acceptances, bank
guaranties, surety bonds, performance bonds and similar instruments
issued or created by or for the account of such Person;
(c) net obligations of such Person under any Swap Contract;
(d) all obligations of such Person to pay the deferred purchase
price of property or services (other than (i) trade accounts payable in
the ordinary course of business that are due within six months of the
incurrence thereof and (ii) any earn-out obligation until such
obligation becomes a liability on the balance sheet of such Person in
accordance with GAAP);
(e) indebtedness (excluding prepaid interest thereon) secured by
a Lien on property owned or being purchased by such Person (including
indebtedness arising under conditional sales or other title retention
agreements and mortgage, industrial revenue bond, industrial development
bond and similar financings), whether or not such indebtedness shall
have been assumed by such Person or is limited in recourse;
(f) all Attributable Indebtedness;
(g) all obligations of such Person in respect of Disqualified
Equity Interests; and
24
(h) all Guarantees of such Person in respect of any of the
foregoing.
For all purposes hereof, the Indebtedness of any Person shall (A) include the
Indebtedness of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such Person
is a general partner or a joint venturer, except to the extent such Person's
liability for such Indebtedness is otherwise limited and only to the extent such
Indebtedness would be included in the calculation of Consolidated Total Debt and
(B) in the case of Holdings and its Subsidiaries, exclude all intercompany
Indebtedness having a term not exceeding 364 days (inclusive of any rollover or
extensions of terms) and made in the ordinary course of business consistent with
past practice. The amount of any net obligation under any Swap Contract on any
date shall be deemed to be the Swap Termination Value thereof as of such date.
The amount of Indebtedness of any Person for purposes of clause (e) shall be
deemed to be equal to the lesser of (i) the aggregate unpaid amount of such
Indebtedness and (ii) the fair market value of the property encumbered thereby
as determined by such Person in good faith.
"INDEMNIFIED LIABILITIES" has the meaning set forth in Section 10.05.
"INDEMNITEES" has the meaning set forth in Section 10.05.
"INFORMATION" has the meaning specified in Section 10.08.
"INSURANCE BUSINESS" means one or more aspects of the business of (a)
selling or underwriting health or life insurance or (b) reinsurance
substantially related to such insurance.
"INSURANCE CONTRACT" means any insurance contract or policy issued by
an Insurance Subsidiary but shall not include any Reinsurance Agreement or
Retrocession Agreement.
"INSURANCE SUBSIDIARY" means any Subsidiary of the Borrower, whether
now owned or hereafter acquired, that is authorized or admitted to carry on or
transact Insurance Business in any jurisdiction and is regulated by the
insurance department or similar regulatory authority of such jurisdiction and
each of such Person's respective employees, officers or directors.
"INTEREST PAYMENT DATE" means, (a) as to any Loan other than a Base
Rate Loan, the last day of each Interest Period applicable to such Loan and the
Maturity Date of the Facility under which such Loan was made; PROVIDED that if
any Interest Period for a Eurocurrency Rate Loan exceeds three months, the
respective dates that fall every three months after the beginning of such
Interest Period shall also be Interest Payment Dates; and (b) as to any Base
Rate Loan, the last Business Day of each March, June, September and December and
the Maturity Date of the Facility under which such Loan was made.
"INTEREST PERIOD" means, as to each Eurocurrency Rate Loan, the period
commencing on the date such Eurocurrency Rate Loan is disbursed or converted to
or
25
continued as a Eurocurrency Rate Loan and ending on the date one, two, three or
six months thereafter, or to the extent available by each Lender of such
Eurocurrency Rate Loan, nine or twelve months or less than one month thereafter,
as selected by the Borrower in its Committed Loan Notice; PROVIDED that:
(a) any Interest Period that would otherwise end on a day that is
not a Business Day shall be extended to the next succeeding Business Day
unless such Business Day falls in another calendar month, in which case
such Interest Period shall end on the next preceding Business Day;
(b) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at the
end of such Interest Period;
(c) no Interest Period shall extend beyond the Maturity Date of
the Facility under which such Loan was made; and
(d) the initial Interest Period for any Eurocurrency Rate Loans
made on the Closing Date may be for a period less than one month,
PROVIDED that such period shall be reasonably acceptable to the
Administrative Agent and each of the Lenders.
"INVESTMENT" means, as to any Person, any direct or indirect
acquisition or investment by such Person, whether by means of (a) the purchase
or other acquisition of Equity Interests or debt or other securities of another
Person, (b) a loan, advance or capital contribution to, Guarantee or assumption
of Indebtedness of, or purchase or other acquisition of any other debt or equity
participation or interest in, another Person, including any partnership or joint
venture interest in such other Person (excluding, in the case of Holdings and
its Restricted Subsidiaries, intercompany loans, advances, or Indebtedness
having a term not exceeding 364 days (inclusive of any rollover or extensions of
terms) and made in the ordinary course of business consistent with past
practice) or (c) the purchase or other acquisition (in one transaction or a
series of transactions) of all or substantially all of the property and assets
or business of another Person or assets constituting a business unit, line of
business or division of such Person. For purposes of covenant compliance, the
amount of any Investment shall be the amount actually invested, without
adjustment for subsequent increases or decreases in the value of such
Investment.
"INVESTORS" means, collectively, the DLJ Investors, the Blackstone
Investors and the Goldman Investors.
"IP RIGHTS" has the meaning set forth in Section 5.15.
"JPMORGAN CHASE BANK" means JPMorgan Chase Bank, N.A. and its
successors.
26
"JUNIOR FINANCING" means any Indebtedness that is required to be
subordinated to the Obligations pursuant to the terms of the Loan Documents,
including the Existing Junior Subordinated Notes and the Junior Subordinated
Notes.
"JUNIOR FINANCING DOCUMENTATION" means any documentation governing any
Junior Financing.
"JUNIOR SUBORDINATED FIXED RATE NOTES" means the Borrower's Fixed Rate
Junior Subordinated Notes due 2036, in an aggregate principal amount of
$50,000,000 issued on April 5, 2006 pursuant to the Junior Subordinated Fixed
Rate Notes Indenture.
"JUNIOR SUBORDINATED FIXED RATE NOTES INDENTURE" means the Junior
Subordinated Notes Indenture dated as of April 5, 2006, between the Borrower and
the trustee named therein from time to time under which the Junior Subordinated
Fixed Rate Notes were issued.
"JUNIOR SUBORDINATED FLOATING RATE NOTES" means the Borrower's
Floating Rate Junior Subordinated Notes due 2036, in an aggregate principal
amount of $50,000,000 issued on April 5, 2006 pursuant to the Junior
Subordinated Floating Rate Notes Indenture.
"JUNIOR SUBORDINATED FLOATING RATE NOTES INDENTURE" means the Junior
Subordinated Notes Indenture dated as of April 5, 2006, between the Borrower and
the trustee named therein from time to time under which the Junior Subordinated
Floating Rate Notes.
"JUNIOR SUBORDINATED NOTES" means, collectively, the Junior
Subordinated Fixed Rate Notes and the Junior Subordinated Floating Rate Notes.
"LAWS" means, collectively, all international, foreign, Federal, state
and local statutes, treaties, rules, guidelines, regulations, ordinances, codes
and administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.
"L/C ADVANCE" means, with respect to each Revolving Credit Lender,
such Lender's funding of its participation in any L/C Borrowing in accordance
with its Pro Rata Share.
"L/C BORROWING" means an extension of credit resulting from a drawing
under any Letter of Credit which has not been reimbursed on the date when made
or refinanced as a Revolving Credit Borrowing.
27
"L/C CREDIT EXTENSION" means, with respect to any Letter of Credit,
the issuance thereof or extension of the expiry date thereof, or the renewal or
increase of the amount thereof.
"L/C ISSUER" means JPMorgan Chase Bank and any other Lender that
becomes an L/C Issuer in accordance with Section 2.03(k) or 10.07(j), in each
case, in its capacity as an issuer of Letters of Credit hereunder, or any
successor issuer of Letters of Credit hereunder.
"L/C OBLIGATIONS" means, as at any date of determination, the
aggregate undrawn amount of all outstanding Letters of Credit plus the aggregate
of all Unreimbursed Amounts, including all L/C Borrowings.
"LENDER" has the meaning specified in the introductory paragraph to
this Agreement and, as the context requires, includes any L/C Issuers, and their
respective successors and assigns as permitted hereunder, each of which is
referred to herein as a "Lender".
"LENDING OFFICE" means, as to any Lender, the office or offices of
such Lender described as such in such Lender's Administrative Questionnaire, or
such other office or offices as a Lender may from time to time notify the
Borrower and the Administrative Agent.
"LETTER OF CREDIT" means (a) any Existing Letter of Credit and (b) any
letter of credit issued hereunder. A Letter of Credit may be a commercial letter
of credit or a standby letter of credit.
"LETTER OF CREDIT APPLICATION" means an application and agreement for
the issuance or amendment of a Letter of Credit in the form from time to time in
use by the relevant L/C Issuer.
"LETTER OF CREDIT EXPIRATION DATE" means the day that is five (5)
Business Days prior to the scheduled Maturity Date then in effect for the
Revolving Credit Facility (or, if such day is not a Business Day, the next
preceding Business Day).
"LIEN" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, security interest
or other similar encumbrance (including any conditional sale or other title
retention agreement, any easement, right of way or other encumbrance on title to
real property, and any Capitalized Lease having substantially the same economic
effect as any of the foregoing).
"LOAN" means an extension of credit by a Lender to the Borrower under
Article II in the form of a Term Loan or a Revolving Credit Loan.
"LOAN DOCUMENTS" means, collectively, (i) this Agreement, (ii) the
Notes, (iii) the Guaranty, (iv) the Collateral Documents and (v) each Letter of
Credit Application.
28
"LOAN PARTIES" means, collectively, the Borrower and each Guarantor.
"MANAGEMENT AGREEMENT" means the management agreement between certain
management companies associated with the Investors and Holdings.
"MANAGEMENT STOCKHOLDERS" means the members of management of Holdings,
the Borrower or its Subsidiaries who are investors in Holdings or any direct or
indirect parent thereof.
"MANAGEMENT TERMINATION FEE" means the one time payment under the
Management Agreement of a termination fee to the Investors or their Affiliates
in the event of either a Change of Control or the completion of a Qualifying IPO
or as otherwise provided therein.
"MASTER AGREEMENT" has the meaning specified in the definition of
"Swap Contract".
"MATERIAL ADVERSE CHANGE" means any event, circumstance, development,
change or effect that, individually or in the aggregate with all other events,
circumstances, developments, changes and effects, has had or would reasonably be
expected to have a material adverse effect on the business, properties,
condition (financial or otherwise) or results of operations of the Borrower and
the Subsidiaries, taken as a whole, or would reasonably be expected to prevent
or materially impair or materially delay the ability of the Borrower to perform
its obligations under this Agreement or to consummate the transactions
contemplated hereby; PROVIDED, HOWEVER, that none of the following, alone or in
combination, will be deemed to constitute, nor will any of the following be
taken into account in determining whether there has been, or would reasonably be
expected to be, a "Material Adverse Change", except to the extent such event,
circumstance, change or effect has had a disproportionate effect on the Borrower
and the Subsidiaries as compared to other Persons in the health and life
insurance industry: any event, circumstance, change or effect resulting from or
relating to (i) changes in general political, economic or financial market
conditions, (ii) changes affecting the health and life insurance industry, or
(iii) seasonal fluctuations in the business of the Borrower and the Subsidiaries
consistent with past fluctuations; and, PROVIDED FURTHER, that the death of
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ on September 2, 2005, will not be deemed to constitute, and
will not be taken into account in determining whether there has been or would
reasonably be expected to be, a "Material Adverse Change".
"MATERIAL ADVERSE EFFECT" means (a) a material adverse effect on the
business, operations, assets, liabilities (actual or contingent) or financial
condition of the Borrower and the Subsidiaries, taken as a whole, (b) a material
adverse effect on the ability of the Borrower or the Loan Parties (taken as a
whole) to perform their respective payment obligations under any Loan Document
to which the Borrower or any of the Loan Parties is a party or (c) a material
adverse effect on the rights and remedies of the Lenders under any Loan
Document.
29
"MATURITY DATE" means (a) with respect to the Revolving Credit
Facility, ▇▇▇▇▇ ▇, ▇▇▇▇, (▇) with respect to the Term Loans, April 5, 2012, and
(c) with respect to any Incremental Term Loan, if any, the date as specified in
the applicable Incremental Amendment.
"MAXIMUM RATE" has the meaning specified in Section 10.10.
"MERGER AGREEMENT" means the Agreement and Plan of Merger dated as of
September 15, 2005, by and among Premium Finance LLC, a Delaware limited
liability company, Mulberry Finance Co., Inc., a Delaware corporation, DLJMB IV
First Merger LLC, a Delaware limited liability company, ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇,
Merger Co3 and Holdings.
"MERGER CONSIDERATION" means the total funds required to consummate
the Mergers.
"MERGER COS" means, collectively, Merger Co1, Merger Co2 and Merger
Co3.
"MERGER CO1" means Premium Acquisition, Inc., a Delaware corporation
and wholly owned subsidiary of the Blackstone Investors.
"MERGER CO2" means Mulberry Acquisition, Inc., a Delaware corporation
and wholly owned subsidiary of the Goldman Investors.
"MERGER CO3" means DLJMB IV First Merger Co Acquisition Inc., a
Delaware corporation and wholly owned subsidiary of the DLJ Investors.
"MERGERS" means the merger, pursuant to the Merger Agreement of each
of the Merger Cos with and into Holdings, with Holdings as the surviving
corporation.
"▇▇▇▇▇'▇" means ▇▇▇▇▇'▇ Investors Service, Inc. and any successor
thereto.
"MULTIEMPLOYER PLAN" means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA, to which any Loan Party or any ERISA
Affiliate makes or is obligated to make contributions, or during the preceding
five plan years, has made or been obligated to make contributions.
"NET CASH PROCEEDS" means: (a) with respect to the Disposition of any
asset by the Borrower or any Restricted Subsidiary or any Casualty Event, the
excess, if any, of (i) the sum of cash and Cash Equivalents received in
connection with such Disposition or Casualty Event (including any cash or Cash
Equivalents received by way of deferred payment pursuant to, or by monetization
of, a note receivable or otherwise, but only as and when so received and, with
respect to any Casualty Event, any insurance proceeds or condemnation awards in
respect of such Casualty Event actually received by or paid to or for the
account of the Borrower or any Restricted Subsidiary) over (ii) the sum of (A)
the principal amount, premium or penalty, if any, interest and other amounts
30
on any Indebtedness that is secured by the asset subject to such Disposition or
Casualty Event and that is required to be repaid (and is timely repaid) in
connection with such Disposition or Casualty Event (other than Indebtedness
under the Loan Documents), (B) the out-of-pocket expenses (including attorneys'
fees, investment banking fees, survey costs, title insurance premiums, and
related search and recording charges, transfer taxes, deed or mortgage recording
taxes, other customary expenses and brokerage, consultant and other customary
fees) actually incurred by the Borrower or such Restricted Subsidiary in
connection with such Disposition or Casualty Event, (C) taxes paid or reasonably
estimated to be actually payable in connection therewith, and (D) any reserve
for adjustment in respect of (x) the sale price of such asset or assets
established in accordance with GAAP and (y) any liabilities associated with such
asset or assets and retained by the Borrower or any Restricted Subsidiary after
such sale or other disposition thereof, including pension and other
post-employment benefit liabilities and liabilities related to environmental
matters or against any indemnification obligations associated with such
transaction and it being understood that "Net Cash Proceeds" shall include any
cash or Cash Equivalents (i) received upon the Disposition of any non-cash
consideration received by the Borrower or any Restricted Subsidiary in any such
Disposition and (ii) upon the reversal (without the satisfaction of any
applicable liabilities in cash in a corresponding amount) of any reserve
described in clause (D) above or, if such liabilities have not been satisfied in
cash and such reserve is not reversed within three hundred and sixty-five (365)
days after such Disposition or Casualty Event, the amount of such reserve;
PROVIDED that (x) no net cash proceeds calculated in accordance with the
foregoing realized in a single transaction or series of related transactions
shall constitute Net Cash Proceeds unless such net cash proceeds shall exceed
$1,000,000 and (y) no such net cash proceeds shall constitute Net Cash Proceeds
under this clause (a) in any fiscal year until the aggregate amount of all such
net cash proceeds in such fiscal year shall exceed $5,000,000 (and thereafter
only net cash proceeds in excess of such amount shall constitute Net Cash
Proceeds under this clause (a)); and (b) with respect to the issuance of any
Permitted Equity Issuance, the excess, if any, of (i) the sum of the cash
received in connection with such issuance over (ii) the investment banking fees,
underwriting discounts, commissions, costs and other out-of-pocket expenses and
other customary expenses, incurred by the Borrower or such Restricted Subsidiary
in connection with such issuance.
"NON-CASH CHARGES" has the meaning set forth in the definition of the
term "Consolidated EBITDA".
"NON-CONSENTING LENDER" has the meaning specified in Section 3.07(d).
"NON-EXCLUDED TAXES" has the meaning specified in Section 3.01(a).
"NON-INVESTMENT GRADE PERIOD" means any period during which the
Applicable Credit Rating is not at least BBB-.
"NONRENEWAL NOTICE DATE" has the meaning specified in Section
2.03(b)(iii).
31
"NOTE" means a Term Note or a Revolving Credit Note, as the context
may require.
"NOTICE OF INTENT TO CURE" has the meaning specified in Section
6.02(b).
"OBLIGATIONS" means all (a) advances to, and debts, liabilities,
obligations, covenants and duties of, any Loan Party arising under any Loan
Document or otherwise with respect to any Loan or Letter of Credit, whether
direct or indirect (including those acquired by assumption), absolute or
contingent, due or to become due, now existing or hereafter arising and
including interest and fees that accrue after the commencement by or against any
Loan Party of any proceeding under any Debtor Relief Laws naming such Person as
the debtor in such proceeding, regardless of whether such interest and fees are
allowed claims in such proceeding, (b) obligations of any Loan Party arising
under any Secured Hedge Agreement and (c) Cash Management Obligations. Without
limiting the generality of the foregoing, the Obligations of the Loan Parties
under the Loan Documents include (x) the obligation (including guarantee
obligations) to pay principal, interest, Letter of Credit commissions,
reimbursement obligations, charges, expenses, fees, Attorney Costs, indemnities
and other amounts payable by any Loan Party under any Loan Document and (y) the
obligation of any Loan Party to reimburse any amount in respect of any of the
foregoing that any Lender, in its sole discretion, may elect to pay or advance
on behalf of such Loan Party.
"ORGANIZATION DOCUMENTS" means, (a) with respect to any corporation,
the certificate or articles of incorporation and the by-laws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement; and (c) with respect to
any partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or
organization of such entity.
"OTHER TAXES" has the meaning specified in Section 3.01(b).
"OUTSTANDING AMOUNT" means (a) with respect to the Term Loans and
Revolving Credit Loans on any date, the aggregate principal amount thereof after
giving effect to any borrowings and prepayments or repayments of Term Loans and
Revolving Credit Loans (including any refinancing of outstanding unpaid drawings
under Letters of Credit or L/C Credit Extensions as a Revolving Credit
Borrowing), as the case may be, occurring on such date; and (b) with respect to
any L/C Obligations on any date, the aggregate principal amount thereof on such
date after giving effect to any L/C Credit Extension occurring on such date and
any other changes thereto as of such date, including as a result of any
reimbursements of outstanding unpaid drawings under any Letters of Credit
(including any refinancing of outstanding unpaid drawings under Letters of
Credit or L/C Credit Extensions as a Revolving Credit Borrowing) or any
reductions in the
32
maximum amount available for drawing under Letters of Credit taking effect on
such date.
"PARTICIPANT" has the meaning specified in Section 10.07(e).
"PBGC" means the Pension Benefit Guaranty Corporation and any
successor entity performing similar functions.
"PENSION PLAN" means any "employee pension benefit plan" (as such term
is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by any Loan Party or
any ERISA Affiliate or to which any Loan Party or any ERISA Affiliate
contributes or has an obligation to contribute, or in the case of a multiple
employer or other plan described in Section 4064(a) of ERISA, has made
contributions at any time during the immediately preceding five (5) plan years.
"PERMITTED ACQUISITION" means any acquisition of property and assets
or businesses of any Person or of assets constituting a business unit, a line of
business or division of such Person, or Equity Interests in a Person that, upon
the consummation thereof, will be a Subsidiary of the Borrower (including a
result of a merger or consolidation that is permitted pursuant to Section
7.02(i)).
"PERMITTED EQUITY ISSUANCE" means any sale or issuance of any
Qualified Equity Interests of Holdings or any parent of Holdings (and, after a
Qualifying IPO of the Borrower, of the Borrower) to the extent not prohibited
hereunder.
"PERMITTED HOLDERS" means each of (i) the Investors, (ii) the
Management Stockholders and (iii) the Agent Stockholders; PROVIDED that if the
Management Stockholders and the Agent Stockholders, collectively, own
beneficially or of record more than twenty percent (20%) of the outstanding
voting stock of Holdings (or, after a Qualifying IPO of the Borrower, of the
Borrower) in the aggregate, the Management Stockholders and the Agent
Stockholders shall be treated as Permitted Holders of only twenty percent (20%)
of the outstanding voting stock of Holdings (or, after a Qualifying IPO of the
Borrower, of the Borrower) at such time.
"PERMITTED INVESTMENT" has the meaning specified in Section 7.02(i).
"PERMITTED REFINANCING" means, with respect to any Person, any
modification, refinancing, refunding, renewal or extension of any Indebtedness
of such Person; PROVIDED that (a) the principal amount (or accreted value, if
applicable) thereof does not exceed the principal amount (or accreted value, if
applicable) of the Indebtedness so modified, refinanced, refunded, renewed or
extended except by an amount equal to unpaid accrued interest and premium
thereon plus other reasonable amounts paid, and fees and expenses reasonably
incurred, in connection with such modification, refinancing, refunding, renewal
or extension and by an amount equal to any existing commitments unutilized
thereunder, (b) other than with respect to a Permitted Refinancing in respect of
Indebtedness permitted pursuant to Section 7.03(e), such modification,
refinancing, refunding, renewal or extension (i) has a final maturity date
33
equal to or later than the earlier of (A) the final maturity date of the
Indebtedness being modified, refinanced, refunded, renewed or extended, or (B)
91 days after (x) the Maturity Date of the Term Loans or (y) if later, the
Maturity Date of any Incremental Term Loan outstanding on the date of issuance
of such Indebtedness, and (ii) has a Weighted Average Life to Maturity equal to
or greater than the earlier of (A) the Weighted Average Life to Maturity of the
Indebtedness being modified, refinanced, refunded, renewed or extended or (B) 91
days after (x) the Maturity Date of the Term Loans or (y) if later, the Maturity
Date of any Incremental Term Loan outstanding on the date of issuance of such
Indebtedness, (c) other than with respect to a Permitted Refinancing in respect
of Indebtedness permitted pursuant to Section 7.03(e), at the time thereof, no
Event of Default shall have occurred and be continuing, (d) to the extent such
Indebtedness being modified, refinanced, refunded, renewed or extended is
subordinated in right of payment to the Obligations, such modification,
refinancing, refunding, renewal or extension is subordinated in right of payment
to the Obligations on terms at least as favorable to the Lenders as those
contained in the documentation governing the Indebtedness being modified,
refinanced, refunded, renewed or extended, (e) the terms and conditions
(including, if applicable, as to collateral but excluding as to subordination,
interest rate and redemption premium) of any such modified, refinanced,
refunded, renewed or extended Indebtedness, taken as a whole, are not materially
less favorable to the Loan Parties or the Lenders than the terms and conditions
of the Indebtedness being modified, refinanced, refunded, renewed or extended,
and (f) such modification, refinancing, refunding, renewal or extension shall
not be incurred by any obligor that was not an obligor with respect to the
Indebtedness being modified, refinanced, refunded, renewed or extended.
"PERSON" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"PLAN" means any "employee benefit plan" (as such term is defined in
Section 3(3) of ERISA) established by any Loan Party or, with respect to any
such plan that is subject to Section 412 of the Code or Title IV of ERISA, any
ERISA Affiliate.
"PLEDGE AGREEMENT" means, collectively, the Pledge Agreement executed
by Holdings and the Borrower substantially in the form of Exhibit F, together
with each other Pledge Agreement Supplement executed and delivered pursuant to
Section 6.11.
"PLEDGE AGREEMENT SUPPLEMENT" has the meaning specified in the Pledge
Agreement.
"PLEDGED EQUITY" has the meaning specified in the Pledge Agreement.
"POST-ACQUISITION PERIOD" means, with respect to any Permitted
Acquisition, the period beginning on the date such Permitted Acquisition is
consummated and ending on the last day of the sixth full consecutive fiscal
quarter immediately following the date on which such Permitted Acquisition is
consummated.
34
"PREFERRED SECURITIES" means (a) the floating rate preferred
securities issued on April 5, 2006, by Healthmarkets Capital Trust I, a Delaware
statutory trust that is a Subsidiary of the Borrower and (b) the fixed rate
preferred securities issued on April 5, 2006, by Healthmarkets Capital Trust II,
a Delaware statutory trust that is a Subsidiary of the Borrower, in each case
the proceeds of which shall have been used to purchase Junior Subordinated
Notes.
"PRO FORMA ADJUSTMENT" means, for any Test Period that includes all or
any part of a fiscal quarter included in any Post-Acquisition Period, with
respect to the Acquired EBITDA of the applicable Acquired Entity or Business or
the Consolidated EBITDA of the Borrower, the pro forma increase or decrease in
such Acquired EBITDA or such Consolidated EBITDA, as the case may be, projected
by the Borrower in good faith as a result of (a) actions taken during such
Post-Acquisition Period for the purposes of realizing reasonably identifiable
and factually supportable cost savings or (b) any additional costs incurred
during such Post-Acquisition Period, in each case in connection with the
combination of the operations of such Acquired Entity or Business with the
operations of the Borrower and the Restricted Subsidiaries; PROVIDED that, so
long as such actions are taken during such Post-Acquisition Period or such costs
are incurred during such Post-Acquisition Period, as applicable, it may be
assumed, for purposes of projecting such pro forma increase or decrease in such
Acquired EBITDA or such Consolidated EBITDA, as the case may be, that such cost
savings will be realizable during the entirety of such Test Period, or such
additional costs, as applicable, will be incurred during the entirety of such
Test Period; PROVIDED FURTHER that any such pro forma increase or decrease in
such Acquired EBITDA or such Consolidated EBITDA, as the case may be, shall be
without duplication for cost savings or additional costs already included in
such Acquired EBITDA or such Consolidated EBITDA, as the case may be, for such
Test Period.
"PRO FORMA BALANCE SHEET" has the meaning set forth in Section
5.05(a)(ii).
"PRO FORMA BASIS", "PRO FORMA COMPLIANCE" and "PRO FORMA EFFECT" mean,
with respect to compliance with any test or covenant hereunder, that (A) to the
extent applicable, the Pro Forma Adjustment shall have been made and (B) all
Specified Transactions and the following transactions in connection therewith
shall be deemed to have occurred as of the first day of the applicable period of
measurement in such test or covenant: (a) income statement items (whether
positive or negative) attributable to the property or Person subject to such
Specified Transaction, (i) in the case of a Disposition of all or substantially
all Equity Interests in any Subsidiary of the Borrower or any division, product
line, or facility used for operations of the Borrower or any of its
Subsidiaries, shall be excluded, and (ii) in the case of a Permitted Acquisition
or Investment described in the definition of "Specified Transaction", shall be
included, (b) any retirement of Indebtedness, and (c) any Indebtedness incurred
or assumed by the Borrower or any of the Restricted Subsidiaries in connection
therewith and if such Indebtedness has a floating or formula rate, shall have an
implied rate of interest for the applicable period for purposes of this
definition determined by utilizing the rate which is or would be in effect with
respect to such Indebtedness as at the relevant date of
35
determination; PROVIDED that, without limiting the application of the Pro Forma
Adjustment pursuant to (A) above, the foregoing pro forma adjustments may be
applied to any such test or covenant solely to the extent that such adjustments
are consistent with the definition of Consolidated EBITDA and give effect to
events (including operating expense reductions) that are (i) (x) directly
attributable to such transaction, (y) expected to have a continuing impact on
the Borrower and the Restricted Subsidiaries and (z) factually supportable or
(ii) otherwise consistent with the definition of Pro Forma Adjustment.
"PRO RATA SHARE" means, with respect to each Lender at any time a
fraction, the numerator of which is the amount of the Commitments of such Lender
under the applicable Facility or Facilities at such time and the denominator of
which is the amount of the Aggregate Commitments under the applicable Facility
or Facilities at such time; PROVIDED that if such Commitments have been
terminated, then the Pro Rata Share of each Lender shall be determined based on
the Pro Rata Share of such Lender immediately prior to such termination and
after giving effect to any subsequent assignments made pursuant to the terms
hereof.
"PROJECTIONS" shall have the meaning set forth in Section 6.01(c).
"QUALIFIED EQUITY INTERESTS" means any Equity Interests that are not
Disqualified Equity Interests.
"QUALIFIED TRUST PREFERRED SECURITIES" means, collectively, the
Existing Preferred Securities, the Preferred Securities and any other trust
preferred securities (a) issued by a statutory trust formed by Holdings or the
Borrower, (b) with terms and conditions substantially similar to the Preferred
Securities and (c) the proceeds of which shall have been used to purchase junior
subordinated notes issued by Holdings or the Borrower with terms and conditions
substantially similar to the Junior Subordinated Notes.
"QUALIFYING IPO" means a bona fide underwritten initial public
offering of voting common Equity Interests of Holdings or the Borrower (or any
parent of Holdings) newly issued by Holdings or the Borrower (or any parent of
Holdings) or held in treasury resulting in receipt by Holdings or the Borrower
(or any parent of Holdings), as the case may be, of at least $200,000,000 of Net
Cash Proceeds.
"REGISTER" has the meaning set forth in Section 10.07(d).
"REINSURANCE AGREEMENT" means any agreement, contract, treaty or other
arrangement whereby one or more insurers, as reinsurers, assume liabilities
under insurance policies or agreements issued by another insurance or
reinsurance company or companies.
"REPLACEMENT RATING AGENCY" has the meaning set forth in the
definition of "Applicable Credit Rating".
36
"REPORTABLE EVENT" means any of the events set forth in Section
4043(c) of ERISA or the regulations issued thereunder, other than events for
which the thirty (30) day notice period has been waived.
"REQUEST FOR CREDIT EXTENSION" means (a) with respect to a Borrowing,
conversion or continuation of Term Loans or Revolving Credit Loans, a Committed
Loan Notice and (b) with respect to an L/C Credit Extension, a Letter of Credit
Application.
"REQUIRED LENDERS" means, as of any date of determination, Lenders
having more than 50% of the sum of the (a) Total Outstandings (with the
aggregate principal amount of each Lender's risk participation and funded
participation in L/C Obligations being deemed "held" by such Lender for purposes
of this definition), (b) aggregate unused Term Commitments, and (c) aggregate
unused Revolving Credit Commitments; PROVIDED that the unused Term Commitment
and unused Revolving Credit Commitment of, and the portion of the Total
Outstandings held or deemed held by, any Defaulting Lender shall be excluded for
purposes of making a determination of Required Lenders.
"RESPONSIBLE OFFICER" means (a) the chief executive officer,
president, vice president, chief financial officer, treasurer or assistant
treasurer or other similar officer of a Loan Party and (b) as to any document
delivered on the Closing Date, any secretary or assistant secretary of a Loan
Party or, in each case, if such Loan Party is a limited liability company, the
member or manager of such Loan Party delegated the authority customary for such
an officer or secretary.
"RESTRICTED PAYMENT" means any dividend or other distribution (whether
in cash, securities or other property) with respect to any Equity Interest of
the Borrower or any Restricted 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, defeasance, acquisition,
cancellation or termination of any such Equity Interest, or on account of any
return of capital to the Borrower's stockholders, partners or members (or the
equivalent Persons thereof).
"RESTRICTED SUBSIDIARY" means any Subsidiary of the Borrower other
than an Unrestricted Subsidiary.
"RESTRUCTURING" means the transfer by Holdings to the Borrower of
substantially all of Holdings' assets (including substantially all the equity
interests of Holdings' Subsidiaries (other than the Borrower)) and certain
liabilities held by Holdings as of the Closing Date, which transfer shall have
occurred substantially simultaneously with the consummation of the Mergers.
"RETROCESSION AGREEMENT" means any agreement, contract, treaty or
other arrangement whereby one or more insurers or reinsurers, as
retrocessionaries, assume liabilities of reinsurers under a Reinsurance
Agreement or other retrocessionaries under another Retrocession Agreement.
37
"REVOLVING CREDIT BORROWING" means a borrowing consisting of
simultaneous Revolving Credit Loans of the same Type and, in the case of
Eurocurrency Rate Loans, having the same Interest Period made by each of the
Revolving Credit Lenders pursuant to Section 2.01(d).
"REVOLVING CREDIT COMMITMENT" means, as to each Revolving Credit
Lender, its obligation to (a) make Revolving Credit Loans to the Borrower
pursuant to Section 2.01(b) and (b) purchase participations in L/C Obligations
in respect of Letters of Credit, in an aggregate principal amount at any one
time outstanding not to exceed the amount set forth, and opposite such Lender's
name, on Schedule 2.01 under the caption "Revolving Credit Commitment" or in the
Assignment and Assumption pursuant to which such Lender becomes a party hereto,
as applicable, as such amount may be adjusted from time to time in accordance
with this Agreement. The aggregate Revolving Credit Commitments of all Revolving
Credit Lenders shall be $75,000,000 on the Closing Date, as such amount may be
adjusted from time to time in accordance with the terms of this Agreement.
"REVOLVING CREDIT EXPOSURE" means, as to each Revolving Credit Lender,
the sum of the outstanding principal amount of such Revolving Credit Lender's
Revolving Credit Loans and its Pro Rata Share of the L/C Obligations at such
time.
"REVOLVING CREDIT FACILITY" means, at any time, the aggregate
principal amount of the Revolving Credit Lenders' Revolving Credit Commitments
at such time.
"REVOLVING CREDIT LENDER" means, at any time, any Lender that has a
Revolving Credit Commitment at such time.
"REVOLVING CREDIT LOAN" has the meaning specified in Section 2.01(b).
"REVOLVING CREDIT NOTE" means a promissory note of the Borrower
payable to any Revolving Credit Lender or its registered assigns, in
substantially the form of Exhibit B-2 hereto, evidencing the aggregate
Indebtedness of such Borrower to such Revolving Credit Lender resulting from the
Revolving Credit Loans made by such Revolving Credit Lender.
"ROLLOVER EQUITY" means the amount of rollover equity in Holdings not
in excess of the type and amounts described in the Information Memorandum dated
March 2006.
"S&P" means Standard & Poor's Ratings Services, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., and any successor thereto.
"SEC" means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal functions.
"SECURED HEDGE AGREEMENT" means any Swap Contract permitted under
Article VII to which any Loan Party or any Subsidiary and any Hedge Bank are
parties.
38
"SECURED OBLIGATIONS" has the meaning specified in the Pledge
Agreement.
"SECURED PARTIES" means, collectively, the Administrative Agent, the
Collateral Agent, the Lenders, the Hedge Banks, any Supplemental Administrative
Agent and each co-agent appointed by the Administrative Agent from time to time
pursuant to Section 9.01(c).
"SECURITIES ACT" means the Securities Act of 1933.
"SOLD ENTITY OR BUSINESS" has the meaning set forth in the definition
of the term "Consolidated EBITDA".
"SOLVENT" and "SOLVENCY" mean, with respect to any Person on any date
of determination, that on such date (a) the fair value of the property of such
Person is greater than the total amount of liabilities, including contingent
liabilities, of such Person, (b) the present fair salable value of the assets of
such Person is not less than the amount that will be required to pay the
probable liability of such Person on its debts as they become absolute and
matured, (c) such Person does not intend to, and does not believe that it will,
incur debts or liabilities beyond such Person's ability to pay such debts and
liabilities as they mature and (d) such Person is not engaged in business or a
transaction, and is not about to engage in business or a transaction, for which
such Person's property would constitute an unreasonably small capital. The
amount of contingent liabilities at any time shall be computed as the amount
that, in the light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an actual or
matured liability.
"SPC" has the meaning specified in Section 10.07(h).
"SPECIFIED TRANSACTION" means, with respect to any period, the
Transaction and any Investment, Disposition, incurrence or repayment of
Indebtedness, Restricted Payment or Subsidiary designation that by the terms of
this Agreement requires "Pro Forma Compliance" with a test or covenant hereunder
or requires such test or covenant to be calculated on a "Pro Forma Basis".
"STAR" means the business of designing, underwriting and marketing
limited benefit group health insurance plans for entry level, high turnover, and
hourly employees of commercial clients, conducted as the Star HRG Division of
The MEGA Life and Health Insurance Company.
"STUDENT" means the business of designing, underwriting and marketing
group health insurance programs covering individual students at colleges and
universities and accident policies for students at public and private schools in
pre-kindergarten through grade 12, conducted as the Student Insurance Division
of The MEGA Life and Health Insurance Company.
"STUDENT LOAN CREDIT FACILITY" means any credit facility pursuant to
which any Student Loan Subsidiary incurs Indebtedness in the ordinary course of
39
business, PROVIDED that (a) such Indebtedness is not guaranteed by Holdings, the
Borrower or any Subsidiary and (b) the obligations in respect of which are
secured solely by such Student Loan Subsidiary's student loans and accrued
interest thereon and cash and Cash Equivalents held by such Student Loan
Subsidiary.
"STUDENT LOAN SUBSIDIARY" means CFLD-I, Inc., a Delaware corporation
and wholly owned Subsidiary of the Borrower.
"SUBSIDIARY" of a Person means a corporation, partnership, joint
venture, limited liability company or other business entity of which a majority
of the shares of securities or other interests having ordinary voting power for
the election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person. Unless otherwise specified, all references herein to a
"Subsidiary" or to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of
the Borrower.
"SUBSIDIARY GUARANTOR" means, collectively, the Subsidiaries of the
Borrower that are Guarantors.
"SUCCESSOR COMPANY" has the meaning specified in Section 7.04(d).
"SUPPLEMENTAL ADMINISTRATIVE AGENT" has the meaning specified in
Section 9.13 and "Supplemental Administrative Agents" shall have the
corresponding meaning.
"SWAP CONTRACT" means (a) any and all rate swap transactions, basis
swaps, credit derivative transactions, forward rate transactions, commodity
swaps, commodity options, forward commodity contracts, equity or equity index
swaps or options, bond or bond price or bond index swaps or options or forward
bond or forward bond price or forward bond index transactions, interest rate
options, forward foreign exchange transactions, cap transactions, floor
transactions, collar transactions, currency swap transactions, cross-currency
rate swap transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a "MASTER AGREEMENT"), including
any such obligations or liabilities under any Master Agreement.
"SWAP TERMINATION VALUE" means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date
40
such Swap Contracts have been closed out and termination value(s) determined in
accordance therewith, such termination value(s), and (b) for any date prior to
the date referenced in clause (a), the amount(s) determined as the
▇▇▇▇-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender).
"SYNDICATION AGENT" means ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Funding Inc., as
Syndication Agent under this Agreement.
"TAXES" has the meaning specified in Section 3.01(a).
"TERM BORROWING" means a borrowing consisting of simultaneous Term
Loans of the same Type.
"TERM COMMITMENT" means, as to each Term Lender, its obligation to
make a Term Loan to the Borrower pursuant to Section 2.01(a) in an aggregate
principal amount not to exceed the amount set forth opposite such Lender's name
on Schedule 2.01(a) under the caption "Term Commitment" or in the Assignment and
Assumption pursuant to which such Term Lender becomes a party hereto, as
applicable, as such amount may be adjusted from time to time in accordance with
this Agreement. The initial aggregate amount of the Term Commitments is
$500,000,000.
"TERM LENDER" means, at any time, any Lender that has a Term
Commitment or a Term Loan at such time.
"TERM LOAN" means a Loan pursuant to Section 2.01(a).
"TERM NOTE" means a promissory note of the Borrower payable to any
Term Lender or its registered assigns, in substantially the form of Exhibit B-1
hereto, evidencing the aggregate Indebtedness of the Borrower to such Term
Lender resulting from the Term Loans made by such Term Lender.
"TEST PERIOD" means, for any determination under this Agreement, the
four consecutive fiscal quarters of the Borrower then last ended.
"THRESHOLD AMOUNT" means $20,000,000.
"TOTAL LEVERAGE RATIO" means, with respect to any Test Period, the
ratio of (a) Consolidated Total Debt as of the last day of such Test Period to
(b) Consolidated EBITDA for such Test Period.
"TOTAL OUTSTANDINGS" means the aggregate Outstanding Amount of all
Loans and all L/C Obligations.
"TRANSACTION" means, collectively, (a) the Restructuring, (b) the
Equity Contribution, (c) the Mergers, (d) the issuance of the Junior
Subordinated Notes and the Preferred Securities, (e) the funding of the Term
Loans and (if any) Revolving Loans on
41
the Closing Date, (f) consummation of any other transactions in connection with
the foregoing and (g) the payment of the fees and expenses incurred in
connection with any of the foregoing.
"TRANSACTION EXPENSES" means any fees, bonuses or expenses incurred or
paid by Holdings, the Borrower or any Restricted Subsidiary in connection with
the Transaction, this Agreement and the other Loan Documents and the
transactions contemplated hereby and thereby.
"TYPE" means, with respect to a Loan, its character as a Base Rate
Loan or a Eurocurrency Rate Loan.
"UNIFORM COMMERCIAL CODE" means the Uniform Commercial Code as the
same may from time to time be in effect in the State of New York or the Uniform
Commercial Code (or similar code or statute) of another jurisdiction, to the
extent it may be required to apply to any item or items of Collateral.
"UNITED STATES" and "U.S." mean the United States of America.
"UNREIMBURSED AMOUNT" has the meaning set forth in Section 2.03(c)(i).
"UNRESTRICTED SUBSIDIARY" means any Subsidiary of the Borrower
designated by the board of directors of Holdings as an Unrestricted Subsidiary
pursuant to Section 6.14 subsequent to the date hereof, PROVIDED that (a) no
Insurance Subsidiary shall be an "Unrestricted Subsidiary" and (b) each
Investment in such Subsidiary by the Borrower or any Restricted Subsidiary is
permitted under Section 7.02.
"WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing: (i) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment; by (ii) the then outstanding principal
amount of such Indebtedness.
"WHOLLY OWNED" means, with respect to a Subsidiary of a Person, a
Subsidiary of such Person all of the outstanding Equity Interests of which
(other than (x) director's qualifying shares and (y) shares issued to foreign
nationals to the extent required by applicable Law) are owned by such Person
and/or by one or more wholly owned Subsidiaries of such Person.
SECTION 1.02. OTHER INTERPRETIVE PROVISIONS. With reference to this
Agreement and each other Loan Document, unless otherwise specified herein or in
such other Loan Document:
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
42
(b) Derivatives of defined terms have correlative meanings.
(c) The words "herein", "hereto", "hereof" and "hereunder" and words
of similar import when used in any Loan Document shall refer to such Loan
Document as a whole and not to any particular provision thereof.
(d) Article, Section, Exhibit and Schedule references are to the Loan
Document in which such reference appears.
(e) The term "including" is by way of example and not limitation.
(f) The term "documents" includes any and all instruments, documents,
agreements, certificates, notices, reports, financial statements and other
writings, however evidenced, whether in physical or electronic form.
(g) In the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including;" the words "to"
and "until" each mean "to but excluding"; and the word "through" means "to and
including".
(h) Section headings herein and in the other Loan Documents are
included for convenience of reference only and shall not affect the
interpretation of this Agreement or any other Loan Document.
SECTION 1.03. ACCOUNTING TERMS. (a) All accounting terms not
specifically or completely defined herein shall be construed in conformity with,
and all financial data (including financial ratios and other financial
calculations) required to be submitted pursuant to this Agreement shall be
prepared in conformity with, GAAP, applied in a manner consistent with that used
in preparing the Audited Financial Statements, except as otherwise specifically
prescribed herein.
(b) Notwithstanding anything to the contrary herein, for purposes of
determining compliance with any test or covenant contained in this Agreement
with respect to any Test Period during which any Specified Transaction occurs,
the Total Leverage Ratio shall be calculated with respect to such Test Period
and such Specified Transaction on a Pro Forma Basis.
SECTION 1.04. ROUNDING. Any financial ratios required to be maintained
by the Borrower pursuant to this Agreement (or required to be satisfied in order
for a specific action to be permitted under this Agreement) shall be calculated
by dividing the appropriate component by the other component, carrying the
result to one place more than the number of places by which such ratio is
expressed herein and rounding the result up or down to the nearest number (with
a rounding-up if there is no nearest number).
SECTION 1.05. REFERENCES TO AGREEMENTS, LAWS, ETC. Unless otherwise
expressly provided herein, (a) references to Organization Documents, agreements
(including the Loan Documents) and other contractual instruments shall be deemed
to include all subsequent amendments, restatements, extensions, supplements and
other
43
modifications thereto, but only to the extent that such amendments,
restatements, extensions, supplements and other modifications are permitted by
any Loan Document; and (b) references to any Law shall include all statutory and
regulatory provisions consolidating, amending, replacing, supplementing or
interpreting such Law.
SECTION 1.06. TIMES OF DAY. Unless otherwise specified, all references
herein to times of day shall be references to Eastern time (daylight or
standard, as applicable).
SECTION 1.07. TIMING OF PAYMENT OF PERFORMANCE. When the payment of
any obligation or the performance of any covenant, duty or obligation is stated
to be due or performance required on a day which is not a Business Day, the date
of such payment (other than as described in the definition of Interest Period)
or performance shall extend to the immediately succeeding Business Day.
ARTICLE II
THE COMMITMENTS AND CREDIT EXTENSIONS
SECTION 2.01. THE LOANS. (a) THE TERM BORROWINGS. Subject to the terms
and conditions set forth herein, each Term Lender severally agrees to make to
the Borrower a single loan denominated in U.S. dollars in a principal amount
equal to such Term Lender's Term Commitment on the Closing Date. Amounts
borrowed under this Section 2.01(a) and repaid or prepaid may not be reborrowed.
Term Loans may be Base Rate Loans or Eurocurrency Rate Loans, as further
provided herein.
(b) THE REVOLVING CREDIT BORROWINGS. Subject to the terms and
conditions set forth herein, each Revolving Credit Lender severally agrees to
make loans denominated in U.S. dollars to the Borrower as elected by the
Borrower pursuant to Section 2.02 (each such loan, a "REVOLVING CREDIT LOAN")
from time to time, on any Business Day until the Maturity Date, in an aggregate
principal amount not to exceed at any time outstanding the amount of such
Lender's Revolving Credit Commitment; PROVIDED that after giving effect to any
Revolving Credit Borrowing, the aggregate outstanding principal amount at such
time of the Revolving Credit Loans of any Lender, plus such Lender's Pro Rata
Share of the outstanding principal amount at such time of all L/C Obligations
shall not exceed such Lender's Revolving Credit Commitment. Within the limits of
each Lender's Revolving Credit Commitment, and subject to the other terms and
conditions hereof, the Borrower may borrow under this Section 2.01(b), prepay
under Section 2.05, and reborrow under this Section 2.01(b). Revolving Credit
Loans may be Base Rate Loans or Eurocurrency Rate Loans, as further provided
herein.
SECTION 2.02. BORROWINGS, CONVERSIONS AND CONTINUATIONS OF LOANS. (a)
Each Term Borrowing, each Revolving Credit Borrowing, each conversion of Term
Loans or Revolving Credit Loans from one Type to the other, and each
continuation of Eurocurrency Rate Loans shall be made upon the Borrower's
irrevocable notice to the Administrative Agent, which may be given by telephone.
Each such notice must be received by the Administrative Agent not later than
12:30 p.m. (New York City time)
44
(i) three (3) Business Days prior to the requested date of any Borrowing or
continuation of Eurocurrency Rate Loans or any conversion of Base Rate Loans to
Eurocurrency Rate Loans, and (ii) one (1) Business Day before the requested date
of any Borrowing of Base Rate Loans. Each telephonic notice by the Borrower
pursuant to this Section 2.02(a) must be confirmed promptly by delivery to the
Administrative Agent of a written Committed Loan Notice, appropriately completed
and signed by a Responsible Officer of the Borrower. Each Borrowing of,
conversion to or continuation of Eurocurrency Rate Loans shall be in a principal
amount of $5,000,000 or a whole multiple of $500,000 in excess thereof. Except
as provided in Sections 2.03(c), each Borrowing of or conversion to Base Rate
Loans shall be in a principal amount of $1,000,000 or a whole multiple of
$100,000 in excess thereof. Each Committed Loan Notice (whether telephonic or
written) shall specify (i) whether the Borrower is requesting a Term Borrowing,
a Revolving Credit Borrowing, a conversion of Term Loans or Revolving Credit
Loans from one Type to the other, or a continuation of Eurocurrency Rate Loans,
(ii) the requested date of the Borrowing, conversion or continuation, as the
case may be (which shall be a Business Day), (iii) the principal amount of Loans
to be borrowed, converted or continued, (iv) the Type of Loans to be borrowed or
to which existing Term Loans or Revolving Credit Loans are to be converted, and
(v) if applicable, the duration of the Interest Period with respect thereto. If
the Borrower fails to specify a Type of Loan in a Committed Loan Notice or fails
to give a timely notice requesting a conversion or continuation, then the
applicable Term Loans or Revolving Credit Loans shall be made as, or converted
to, Base Rate Loans. Any such automatic conversion to Base Rate Loans shall be
effective as of the last day of the Interest Period then in effect with respect
to the applicable Eurocurrency Rate Loans. If the Borrower requests a Borrowing
of, conversion to, or continuation of Eurocurrency Rate Loans in any such
Committed Loan Notice, but fails to specify an Interest Period, it will be
deemed to have specified an Interest Period of one (1) month.
(b) Following receipt of a Committed Loan Notice, the Administrative
Agent shall promptly notify each Lender of the amount of its Pro Rata Share of
the applicable Class of Loans, and if no timely notice of a conversion or
continuation is provided by the Borrower, the Administrative Agent shall notify
each Lender of the details of any automatic conversion to Base Rate Loans or
continuation described in Section 2.02(a). In the case of each Borrowing, each
Revolving Credit Lender or Term Lender, as the case may be, shall make the
amount of its Loan available to the Administrative Agent in immediately
available funds to the account of the Administrative Agent most recently
designated by it for such purpose by notice to the Revolving Credit Lenders or
Term Lenders, as the case may be, not later than 1:00 p.m., on the Business Day
specified in the applicable Committed Loan Notice. Upon satisfaction of the
applicable conditions set forth in Section 4.02 (and, if such Borrowing is the
initial Credit Extension, Section 4.01), the Administrative Agent shall make all
funds so received available to the Borrower in like funds as received by the
Administrative Agent either by (i) crediting the account of the Borrower on the
books of JPMorgan Chase Bank with the amount of such funds or (ii) wire transfer
of such funds, in each case in accordance with instructions provided to (and
reasonably acceptable to) the Administrative Agent by the Borrower; PROVIDED
that if, on the date the Committed Loan Notice with respect to such Borrowing is
given by the Borrower, there are L/C Borrowings outstanding, then the
45
proceeds of such Borrowing shall be applied by the Borrower, first, to the
payment in full of any such L/C Borrowings and second, to the Borrower as
provided above.
(c) Except as otherwise provided herein, a Eurocurrency Rate Loan may
be continued or converted only on the last day of an Interest Period for such
Eurocurrency Rate Loan unless the Borrower pays the amount due, if any, under
Section 3.05 in connection therewith. During the existence of an Event of
Default, the Administrative Agent or the Required Lenders may require that no
Loans may be converted to or continued as Eurocurrency Rate Loans.
(d) The Administrative Agent shall promptly notify the Borrower and
the Lenders of the interest rate applicable to any Interest Period for
Eurocurrency Rate Loans upon determination of such interest rate. The
determination of the Eurocurrency Rate by the Administrative Agent shall be
conclusive in the absence of manifest error. At any time that Base Rate Loans
are outstanding, the Administrative Agent shall notify the Borrower and the
Lenders of any change in the JPMorgan Chase Bank prime rate used in determining
the Base Rate promptly following the public announcement of such change.
(e) After giving effect to all Term Borrowings, all Revolving Credit
Borrowings, all conversions of Term Loans or Revolving Credit Loans from one
Type to the other, and all continuations of Term Loans or Revolving Credit Loans
as the same Type, there shall not be more than twenty (20) Interest Periods in
effect.
(f) The failure of any Lender to make the Loan to be made by it as
part of any Borrowing shall not relieve any other Lender of its obligation, if
any, hereunder to make its Loan on the date of such Borrowing, but no Lender
shall be responsible for the failure of any other Lender to make the Loan to be
made by such other Lender on the date of any Borrowing.
SECTION 2.03. LETTERS OF CREDIT. (a) THE LETTER OF CREDIT COMMITMENT.
(i) Subject to the terms and conditions set forth herein, (A) each L/C Issuer
agrees, in reliance upon the agreements of the other Revolving Credit Lenders
set forth in this Section 2.03, (1) from time to time on any Business Day during
the period from the Closing Date until the Letter of Credit Expiration Date, to
issue Letters of Credit for the account of the Borrower (PROVIDED that any
Letter of Credit may be for the benefit of any Subsidiary of the Borrower) and
to amend or renew Letters of Credit previously issued by it, in accordance with
Section 2.03(b), and (2) to honor drafts under the Letters of Credit and (B) the
Revolving Credit Lenders severally agree to participate in Letters of Credit
issued pursuant to this Section 2.03; PROVIDED that no L/C Issuer shall be
obligated to make any L/C Credit Extension with respect to any Letter of Credit,
and no Lender shall be obligated to participate in any Letter of Credit, if as
of the date of such L/C Credit Extension, (x) the Revolving Credit Exposure of
any Lender would exceed such Lender's Revolving Credit Commitment or (y) the
outstanding principal amount of the L/C Obligations at such time would exceed
$35,000,000. Within the foregoing limits, and subject to the terms and
conditions hereof, the Borrower's ability to obtain Letters of Credit shall be
fully revolving, and accordingly the Borrower may, during the foregoing period,
obtain Letters of Credit to replace Letters of Credit that have expired or that
have
46
been drawn upon and reimbursed. For purposes of this Agreement and the other
Loan Documents, each Existing Letter of Credit is deemed to be a letter of
credit issued hereunder.
(ii) An L/C Issuer shall be under no obligation to issue any Letter of
Credit if:
(A) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or
restrain such L/C Issuer from issuing such Letter of Credit, or any
Law applicable to such L/C Issuer or any directive (whether or not
having the force of Law) from any Governmental Authority with
jurisdiction over such L/C Issuer shall prohibit, or direct that such
L/C Issuer refrain from, the issuance of letters of credit generally
or such Letter of Credit in particular or shall impose upon such L/C
Issuer with respect to such Letter of Credit any restriction, reserve
or capital requirement (for which such L/C Issuer is not otherwise
compensated hereunder) not in effect on the Closing Date, or shall
impose upon such L/C Issuer any unreimbursed loss, cost or expense
which was not applicable on the Closing Date (for which such L/C
Issuer is not otherwise compensated hereunder);
(B) subject to Section 2.03(b)(iii), the expiry date of such
requested Letter of Credit would occur more than twelve months after
the date of issuance or last renewal, unless the Required Lenders have
approved such expiry date;
(C) the issuance of such Letter of Credit would violate any
Laws binding upon such L/C Issuer; or
(D) such Letter of Credit is in an initial amount less than
$250,000 or such lesser amount as the L/C Issuer may agree.
(iii) An L/C Issuer shall be under no obligation to amend any Letter
of Credit if (A) such L/C Issuer would have no obligation at such time to
issue such Letter of Credit in its amended form under the terms hereof, or
(B) the beneficiary of such Letter of Credit does not accept the proposed
amendment to such Letter of Credit.
(iv) The expiry date of such requested Letter of Credit may
occur after the Letter of Credit Expiration Date if the L/C Issuer so
agrees, PROVIDED that the Borrower shall provide cash collateral
pursuant to documentation reasonably satisfactory to the
Administrative Agent and the relevant L/C Issuer in an amount equal to
105% of the face amount of each such Letter of Credit on or prior to
the date that is 91 days prior to the Letter of Credit Expiration
Date.
(b) PROCEDURES FOR ISSUANCE AND AMENDMENT OF LETTERS OF CREDIT;
AUTO-RENEWAL LETTERS OF CREDIT. (i) Each Letter of Credit shall be issued or
amended, as the case may be, upon the request of the Borrower delivered to an
L/C Issuer (with a copy to
47
the Administrative Agent) in the form of a Letter of Credit Application,
appropriately completed and signed by a Responsible Officer of the Borrower.
Such Letter of Credit Application must be received by the relevant L/C Issuer
and the Administrative Agent not later than 12:30 p.m. at least two (2) Business
Days prior to the proposed issuance date or date of amendment, as the case may
be; or, in each case, such later date and time as the relevant L/C Issuer may
agree in a particular instance in its sole discretion. In the case of a request
for an initial issuance of a Letter of Credit, such Letter of Credit Application
shall specify in form and detail reasonably satisfactory to the relevant L/C
Issuer: (a) the proposed issuance date of the requested Letter of Credit (which
shall be a Business Day); (b) the amount thereof; (c) the expiry date thereof;
(d) the name and address of the beneficiary thereof; (e) the documents to be
presented by such beneficiary in case of any drawing thereunder; (f) the full
text of the Letter of Credit and any certificate, if any, to be presented by
such beneficiary in case of any drawing thereunder; and (g) such other matters
as the relevant L/C Issuer may reasonably request. In the case of a request for
an amendment of any outstanding Letter of Credit, such Letter of Credit
Application shall specify in form and detail reasonably satisfactory to the
relevant L/C Issuer (1) the Letter of Credit to be amended; (2) the proposed
date of amendment thereof (which shall be a Business Day); (3) the nature of the
proposed amendment; and (4) such other matters as the relevant L/C Issuer may
reasonably request.
(ii) Promptly after receipt of any Letter of Credit
Application, the relevant L/C Issuer will confirm with the
Administrative Agent (by telephone or in writing) that the
Administrative Agent has received a copy of such Letter of Credit
Application from the Borrower and, if not, such L/C Issuer will
provide the Administrative Agent with a copy thereof. Upon receipt by
the relevant L/C Issuer of confirmation from the Administrative Agent
that the requested issuance or amendment is permitted in accordance
with the terms hereof, then, subject to the terms and conditions
hereof, such L/C Issuer shall, on the requested date, issue a Letter
of Credit for the account of the Borrower or enter into the applicable
amendment, as the case may be. Immediately upon the issuance of each
Letter of Credit, each Revolving Credit Lender shall be deemed to, and
hereby irrevocably and unconditionally agrees to, purchase from the
relevant L/C Issuer a risk participation in such Letter of Credit in
an amount equal to the product of such Lender's Pro Rata Share times
the amount of such Letter of Credit.
(iii) If the Borrower so requests in any applicable Letter
of Credit Application, the relevant L/C Issuer shall agree to issue a
Letter of Credit that has automatic renewal provisions (each, an
"AUTO-RENEWAL LETTER OF CREDIT"); PROVIDED that any such Auto-Renewal
Letter of Credit must permit the relevant L/C Issuer to prevent any
such renewal at least once in each twelve month period (commencing
with the date of issuance of such Letter of Credit) by giving prior
notice to the beneficiary thereof not later than a day (the
"NONRENEWAL NOTICE DATE") in each such twelve month period to be
agreed upon at the time such Letter of Credit is issued. Unless
otherwise directed by the relevant L/C Issuer, the Borrower shall not
be required to make a specific request to the relevant L/C Issuer for
any such renewal. Once an Auto-Renewal Letter of Credit has been
issued, the Lenders shall be deemed to have authorized (but may not
require) the
48
relevant L/C Issuer to permit the renewal of such Letter of Credit at
any time to an expiry date not later than the Letter of Credit
Expiration Date; PROVIDED that the relevant L/C Issuer shall not
permit any such renewal if (A) the relevant L/C Issuer has determined
that it would have no obligation at such time to issue such Letter of
Credit in its renewed form under the terms hereof (by reason of the
provisions of Section 2.03(a)(ii) or otherwise), or (B) it has
received notice (which may be by telephone or in writing) on or before
the day that is five (5) Business Days before the Nonrenewal Notice
Date from the Administrative Agent or the Borrower that one or more of
the applicable conditions specified in Section 4.02 is not then
satisfied.
(iv) Promptly after its delivery of any Letter of Credit or any
amendment to a Letter of Credit to an advising bank with respect
thereto or to the beneficiary thereof, the relevant L/C Issuer will
also deliver to the Borrower and the Administrative Agent a true and
complete copy of such Letter of Credit or amendment.
(c) DRAWINGS AND REIMBURSEMENTS; FUNDING OF PARTICIPATIONS. (i) Upon
receipt from the beneficiary of any Letter of Credit of any notice of a drawing
under such Letter of Credit, the relevant L/C Issuer shall notify promptly the
Borrower and the Administrative Agent thereof. Not later than 11:00 a.m. on the
Business Day immediately following any payment by an L/C Issuer under a Letter
of Credit (each such date, an "HONOR DATE"), the Borrower shall reimburse such
L/C Issuer through the Administrative Agent in an amount equal to the amount of
such drawing. If the Borrower fails to so reimburse such L/C Issuer by such
time, the Administrative Agent shall promptly notify each Revolving Credit
Lender of the Honor Date, the amount of the unreimbursed drawing (the
"UNREIMBURSED AMOUNT"), and the amount of such Revolving Credit Lender's Pro
Rata Share thereof. In such event, the Borrower shall request a Revolving Credit
Borrowing of Base Rate Loans in accordance with Section 2.02 to be disbursed on
the Honor Date in an amount equal to the Unreimbursed Amount, without regard to
the minimum and multiples specified in Section 2.02 for the principal amount of
Base Rate Loans but subject to the amount of the unutilized portion of the
Revolving Credit Commitments of the Revolving Credit Lenders and the conditions
set forth in Section 4.02 (other than the delivery of a Committed Loan Notice).
Any notice given by an L/C Issuer or the Administrative Agent pursuant to this
Section 2.03(c)(i) may be given by telephone if immediately confirmed in
writing; PROVIDED that the lack of such an immediate confirmation shall not
affect the conclusiveness or binding effect of such notice.
(ii) Each Revolving Credit Lender shall upon any notice
pursuant to Section 2.03(c)(i) make funds available to the
Administrative Agent for the account of the relevant L/C Issuer, in
U.S. dollars, to the account of the Administrative Agent most recently
designated by it for such purpose by notice to the Revolving Credit
Lenders in an amount equal to its Pro Rata Share of the Unreimbursed
Amount not later than 1:00 p.m. on the Business Day specified in such
notice by the Administrative Agent. The Administrative Agent shall
remit the funds so received to the relevant L/C Issuer.
49
(iii) With respect to any Unreimbursed Amount that is not
fully refinanced by a Revolving Credit Borrowing of Base Rate Loans
because the conditions set forth in Section 4.02 cannot be satisfied
or for any other reason, the Borrower shall be deemed to have incurred
from the relevant L/C Issuer an L/C Borrowing in the amount of the
Unreimbursed Amount that is not so refinanced, which L/C Borrowing
shall be due and payable on demand (together with interest) and shall
bear interest at the Default Rate. In such event, each Revolving
Credit Lender's payment to the Administrative Agent for the account of
the relevant L/C Issuer pursuant to Section 2.03(c)(ii) shall be
deemed payment in respect of its participation in such L/C Borrowing
and shall constitute an L/C Advance from such Lender in satisfaction
of its participation obligation under this Section 2.03.
(iv) Until each Revolving Credit Lender funds its Revolving
Credit Loan or L/C Advance pursuant to this Section 2.03(c) to
reimburse the relevant L/C Issuer for any amount drawn under any
Letter of Credit, interest in respect of such Lender's Pro Rata Share
of such amount shall be solely for the account of the relevant L/C
Issuer.
(v) Each Revolving Credit Lender's obligation to make
Revolving Credit Loans or L/C Advances to reimburse an L/C Issuer for
amounts drawn under Letters of Credit, as contemplated by this Section
2.03(c), shall be absolute and unconditional and shall not be affected
by any circumstance, including (A) any setoff, counterclaim,
recoupment, defense or other right which such Lender may have against
the relevant L/C Issuer, the Borrower or any other Person for any
reason whatsoever, (B) the occurrence or continuance of a Default, or
(C) any other occurrence, event or condition, whether or not similar
to any of the foregoing; PROVIDED that each Revolving Credit Lender's
obligation to make Revolving Credit Loans pursuant to this Section
2.03(c) is subject to the conditions set forth in Section 4.02 (other
than delivery by the Borrower of a Committed Loan Notice ). No such
making of an L/C Advance shall relieve or otherwise impair the
obligation of the Borrower to reimburse the relevant L/C Issuer for
the amount of any payment made by such L/C Issuer under any Letter of
Credit, together with interest as provided herein.
(vi) If any Revolving Credit Lender fails to make available
to the Administrative Agent for the account of the relevant L/C Issuer
any amount required to be paid by such Lender pursuant to the
foregoing provisions of this Section 2.03(c) by the time specified in
Section 2.03(c)(ii), such L/C Issuer shall be entitled to recover from
such Lender (acting through the Administrative Agent), on demand, such
amount with interest thereon for the period from the date such payment
is required to the date on which such payment is immediately available
to such L/C Issuer at a rate per annum equal to the Federal Funds Rate
from time to time in effect. A certificate of the relevant L/C Issuer
submitted to any Revolving Credit Lender (through the Administrative
Agent) with respect to any amounts owing under this Section 2.03(c)(vi)
shall be conclusive absent manifest error.
50
(d) REPAYMENT OF PARTICIPATIONS. (i) If, at any time after an L/C
Issuer has made a payment under any Letter of Credit and has received from any
Revolving Credit Lender such Lender's L/C Advance in respect of such payment in
accordance with Section 2.03(c), the Administrative Agent receives for the
account of such L/C Issuer any payment in respect of the related Unreimbursed
Amount or interest thereon (whether directly from the Borrower or otherwise,
including proceeds of Cash Collateral applied thereto by the Administrative
Agent), the Administrative Agent will distribute to such Lender its Pro Rata
Share thereof (appropriately adjusted, in the case of interest payments, to
reflect the period of time during which such Lender's L/C Advance was
outstanding).
(ii) If any payment received by the Administrative Agent for
the account of an L/C Issuer pursuant to Section 2.03(c)(i) is
required to be returned under any of the circumstances described in
Section 10.06 (including pursuant to any settlement entered into by
such L/C Issuer in its discretion), each Revolving Credit Lender shall
pay to the Administrative Agent for the account of such L/C Issuer its
Pro Rata Share thereof on demand of the Administrative Agent, plus
interest thereon from the date of such demand to the date such amount
is returned by such Lender, at a rate per annum equal to the Federal
Funds Rate from time to time in effect.
(e) OBLIGATIONS ABSOLUTE. The obligation of the Borrower to reimburse
the relevant L/C Issuer for each drawing under each Letter of Credit issued by
it and to repay each L/C Borrowing shall be absolute, unconditional and
irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances, including the following:
(i) any lack of validity or enforceability of such Letter of
Credit, this Agreement, or any other agreement or instrument relating
thereto;
(ii) the existence of any claim, counterclaim, setoff,
defense or other right that any Loan Party may have at any time
against any beneficiary or any transferee of such Letter of Credit (or
any Person for whom any such beneficiary or any such transferee may be
acting), the relevant L/C Issuer or any other Person, whether in
connection with this Agreement, the transactions contemplated hereby
or by such Letter of Credit or any agreement or instrument relating
thereto, or any unrelated transaction;
(iii) any draft, demand, certificate or other document
presented under such Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect; or any loss or
delay in the transmission or otherwise of any document required in
order to make a drawing under such Letter of Credit;
(iv) any payment by the relevant L/C Issuer under such
Letter of Credit against presentation of a draft or certificate that
does not strictly comply with the terms of such Letter of Credit; or
any payment made by the relevant L/C Issuer
51
under such Letter of Credit to any Person purporting to be a trustee
in bankruptcy, debtor-in-possession, assignee for the benefit of
creditors, liquidator, receiver or other representative of or
successor to any beneficiary or any transferee of such Letter of
Credit, including any arising in connection with any proceeding under
any Debtor Relief Law;
(v) any exchange, release or nonperfection of any
Collateral, or any release or amendment or waiver of or consent to
departure from the Guaranty or any other guarantee, for all or any of
the Obligations any Loan Party in respect of such Letter of Credit; or
(vi) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available to,
or a discharge of, any Loan Party;
PROVIDED that the foregoing shall not excuse any L/C Issuer from liability to
the Borrower to the extent of any direct damages (as opposed to consequential
damages, claims in respect of which are waived by the Borrower to the extent
permitted by applicable Law) suffered by the Borrower that are caused by such
L/C Issuer's gross negligence or willful misconduct when determining whether
drafts and other documents presented under a Letter of Credit comply with the
terms thereof.
(f) ROLE OF L/C ISSUERS. Each Lender and the Borrower agree that, in
paying any drawing under a Letter of Credit, the relevant L/C Issuer shall not
have any responsibility to obtain any document (other than any sight draft,
certificates and documents expressly required by the Letter of Credit) or to
ascertain or inquire as to the validity or accuracy of any such document or the
authority of the Person executing or delivering any such document. None of the
L/C Issuers, any Agent-Related Person nor any of the respective correspondents,
participants or assignees of any L/C Issuer shall be liable to any Lender for
(i) any action taken or omitted in connection herewith at the request or with
the approval of the Lenders or the Required Lenders, as applicable; (ii) any
action taken or omitted in the absence of gross negligence or willful
misconduct; or (iii) the due execution, effectiveness, validity or
enforceability of any document or instrument related to any Letter of Credit or
Letter of Credit Application. The Borrower hereby assumes all risks of the acts
or omissions of any beneficiary or transferee with respect to its use of any
Letter of Credit; PROVIDED that this assumption is not intended to, and shall
not, preclude the Borrower's pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement. None
of the L/C Issuers, any Agent-Related Person, nor any of the respective
correspondents, participants or assignees of any L/C Issuer, shall be liable or
responsible for any of the matters described in clauses (i) through (vi) of
Section 2.03(e); PROVIDED that anything in such clauses to the contrary
notwithstanding, the Borrower may have a claim against an L/C Issuer, and such
L/C Issuer may be liable to the Borrower, to the extent, but only to the extent,
of any direct, as opposed to consequential or exemplary, damages suffered by the
Borrower which the Borrower proves were caused by such L/C Issuer's willful
misconduct or gross negligence or such L/C Issuer's willful or grossly negligent
failure to pay under any Letter of Credit after the presentation to it by the
beneficiary of a sight
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draft and certificate(s) strictly complying with the terms and conditions of a
Letter of Credit. In furtherance and not in limitation of the foregoing, each
L/C Issuer may accept documents that appear on their face to be in order,
without responsibility for further investigation, regardless of any notice or
information to the contrary, and no L/C Issuer shall be responsible for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason.
(g) CASH COLLATERAL. If (i) any Event of Default occurs and is
continuing and the Administrative Agent or the Required Lenders, as applicable,
require the Borrower to Cash Collateralize the L/C Obligations pursuant to
Section 8.02(c) or (ii) an Event of Default set forth under Section 8.01(f)
occurs and is continuing, then the Borrower shall Cash Collateralize the then
Outstanding Amount of all L/C Obligations plus interest and fees due thereon (in
an amount equal to such Outstanding Amount, interest and fees determined as of
the date of such Event of Default), and shall do so not later than 2:00 P.M.,
New York City time, on (x) in the case of the immediately preceding clause (i),
(1) the Business Day that the Borrower receives notice thereof, if such notice
is received on such day prior to 12:00 Noon, New York City time, or (2) if
clause (1) above does not apply, the Business Day immediately following the day
that the Borrower receives such notice and (y) in the case of the immediately
preceding clause (ii), the Business Day on which an Event of Default set forth
under Section 8.01(f) occurs or, if such day is not a Business Day, the Business
Day immediately succeeding such day. For purposes hereof, "CASH COLLATERALIZE"
means to pledge and deposit with or deliver to the Administrative Agent, for the
benefit of the relevant L/C Issuer and the Lenders, as collateral for the L/C
Obligations, cash or deposit account balances ("CASH COLLATERAL") pursuant to
documentation in form and substance reasonably satisfactory to the
Administrative Agent and the relevant L/C Issuer (which documents are hereby
consented to by the Lenders). The Borrower hereby grants to the Administrative
Agent, for the benefit of the L/C Issuers and the Lenders, a security interest
in all such cash, deposit accounts and all balances therein and all proceeds of
the foregoing. Cash Collateral shall be maintained in blocked accounts at
JPMorgan Chase Bank and may be invested in readily available Cash Equivalents.
If at any time the Administrative Agent determines that any funds held as Cash
Collateral are subject to any right or claim of any Person other than the
Administrative Agent (on behalf of the Secured Parties) or that the total amount
of such funds is less than the aggregate Outstanding Amount of all L/C
Obligations, the Borrower will, forthwith upon demand by the Administrative
Agent, pay to the Administrative Agent, as additional funds to be deposited and
held in the deposit accounts at JPMorgan Chase Bank as aforesaid, an amount
equal to the excess of (a) such aggregate Outstanding Amount plus interest and
fees over (b) the total amount of funds, if any, then held as Cash Collateral
that the Administrative Agent reasonably determines to be free and clear of any
such right and claim. Upon the drawing of any Letter of Credit for which funds
are on deposit as Cash Collateral, such funds shall be applied, to the extent
permitted under applicable Law, to reimburse the relevant L/C Issuer. To the
extent any Event of Default has been cured or waived, the amount of cash
collateral shall be refunded to the Borrower.
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(h) LETTER OF CREDIT FEES. The Borrower shall pay to the
Administrative Agent for the account of each Revolving Credit Lender in
accordance with its Pro Rata Share a Letter of Credit fee for each Letter of
Credit issued pursuant to this Agreement equal to the Applicable Rate with
respect to the Eurocurrency Rate times the daily maximum amount then available
to be drawn under such Letter of Credit (whether or not such maximum amount is
then in effect under such Letter of Credit if such maximum amount increases
periodically pursuant to the terms of such Letter of Credit). Such letter of
credit fees shall be computed on a quarterly basis in arrears. Such letter of
credit fees shall be due and payable in U.S. dollars on the third Business Day
after the end of each March, June, September and December, commencing with the
first such date to occur after the issuance of such Letter of Credit, on the
Letter of Credit Expiration Date and thereafter on demand. If there is any
change in the Applicable Rate during any quarter, the daily maximum amount of
each Letter of Credit shall be computed and multiplied by the Applicable Rate
separately for each period during such quarter that such Applicable Rate was in
effect.
(i) FRONTING FEE AND DOCUMENTARY AND PROCESSING CHARGES PAYABLE TO L/C
ISSUERS. The Borrower shall pay directly to each L/C Issuer for its own account
a fronting fee with respect to each Letter of Credit issued by it equal to 0.25%
per annum of the daily maximum amount then available to be drawn under such
Letter of Credit (whether or not such maximum amount is then in effect under
such Letter of Credit if such maximum amount increases periodically pursuant to
the terms of such Letter of Credit). Such fronting fees shall be computed on a
quarterly basis in arrears. Such fronting fees shall be due and payable on the
third Business Day after the end of each March, June, September and December,
commencing with the first such date to occur after the issuance of such Letter
of Credit, on the Letter of Credit Expiration Date and thereafter on demand. In
addition, the Borrower shall pay directly to each L/C Issuer for its own account
the customary issuance, presentation, amendment and other processing fees, and
other standard costs and charges, of such L/C Issuer relating to letters of
credit as from time to time in effect. Such customary fees and standard costs
and charges are due and payable within ten (10) Business Days of demand and are
nonrefundable.
(j) CONFLICT WITH LETTER OF CREDIT APPLICATION. Notwithstanding
anything else to the contrary in this Agreement, in the event of any conflict
between the terms hereof and the terms of any Letter of Credit Application, the
terms hereof shall control.
(k) ADDITION OF AN L/C ISSUER. A Revolving Credit Lender may become an
additional L/C Issuer hereunder pursuant to a written agreement among the
Borrower, the Administrative Agent and such Revolving Credit Lender. The
Administrative Agent shall notify the Revolving Credit Lenders of any such
additional L/C Issuer.
SECTION 2.04. [Reserved].
SECTION 2.05. PREPAYMENTS. (a) OPTIONAL. (i) The Borrower may, upon
notice to the Administrative Agent, at any time or from time to time voluntarily
prepay Term Loans and Revolving Credit Loans in whole or in part without premium
or penalty; PROVIDED that (1) such notice must be received by the Administrative
Agent not
54
later than 12:30 p.m. (New York City time) (A) three (3) Business Days prior to
any date of prepayment of Eurocurrency Rate Loans and (B) on the date of
prepayment of Base Rate Loans; (2) any prepayment of Eurocurrency Rate Loans
shall be in a principal amount of $5,000,000 or a whole multiple of $500,000 in
excess thereof; and (3) any prepayment of Base Rate Loans shall be in a
principal amount of $1,000,000 or a whole multiple of $100,000 in excess thereof
or, in each case, if less, the entire principal amount thereof then outstanding.
Each such notice shall specify the date and amount of such prepayment and the
Class(es) and Type(s) of Loans to be prepaid. The Administrative Agent will
promptly notify each Revolving Credit Lender or Term Lender, as the case may be,
of its receipt of each such notice, and of the amount of such Lender's Pro Rata
Share of such prepayment. If such notice is given by the Borrower, the Borrower
shall make such prepayment and the payment amount specified in such notice shall
be due and payable on the date specified therein. Any prepayment of a
Eurocurrency Rate Loan shall be accompanied by all accrued interest thereon,
together with any additional amounts required pursuant to Section 3.05. Each
prepayment of the Loans pursuant to this Section 2.05(a) shall be paid to the
Revolving Credit Lenders or Term Lenders, as the case may be, in accordance with
their respective Pro Rata Shares.
(ii) Notwithstanding anything to the contrary contained in
this Agreement, the Borrower may rescind any notice of prepayment
under Section 2.05(a)(i) if such prepayment would have resulted from a
refinancing of all of the Facilities, which refinancing shall not be
consummated or shall otherwise be delayed.
(b) MANDATORY. (i) If the Applicable Credit Rating is not at least
BBB- as of the end of any fiscal year, within five (5) Business Days after the
financial statements have been delivered pursuant to Section 6.01(a) in respect
of such fiscal year and the related Compliance Certificate has been delivered
pursuant to Section 6.02(b), the Borrower shall cause to be prepaid an aggregate
principal amount of Term Loans in an amount equal to (A) 50% of Excess Cash
Flow, if any, for (1) the period from but excluding the Closing Date to December
31, 2006, covered by such financial statements and (2) thereafter, the fiscal
year covered by such financial statements MINUS (B) the sum of (x) all voluntary
prepayments of Term Loans during such fiscal year and (y) all voluntary
prepayments of Revolving Credit Loans during such fiscal year to the extent the
Revolving Credit Commitments are permanently reduced by the amount of such
payments, in the case of each of the immediately preceding clauses (x) and (y),
to the extent such prepayments are not funded with the proceeds of Indebtedness;
PROVIDED that (A) the percentage in Section 2.05(b)(i) shall be reduced to 25%
if the Total Leverage Ratio as of the last day of the fiscal year covered by
such financial statements was less than 1.4 to 1.0 and greater than or equal to
1.1 to 1.0 and (B) no payment of any Loans shall be required under this Section
2.05(b)(i) if the Total Leverage Ratio as of the last day of the fiscal year
covered by such financial statements was less than 1.1 to 1.0.
(ii) If for any reason the aggregate Revolving Credit Exposures at any
time exceeds the aggregate Revolving Credit Commitments then in effect, the
Borrower shall promptly prepay or cause to be promptly prepaid Revolving
Credit Loans and/or Cash Collateralize the L/C Obligations in an aggregate
amount equal to such excess; PROVIDED that the Borrower shall not be
required to Cash
55
Collateralize the L/C Obligations pursuant to this Section 2.05(b)(ii)
unless after the prepayment in full of the Revolving Credit Loans such
aggregate Outstanding Amount exceeds the aggregate Revolving Credit
Commitments then in effect.
(iii) Each prepayment of Term Loans pursuant to this Section
2.05(b) shall be applied in direct order of maturity to repayments
thereof required pursuant to Section 2.07(a); and each such prepayment
shall be paid to the Lenders in accordance with their respective Pro
Rata Shares, subject to clause (v) of this Section 2.05(b).
(iv) The Borrower shall notify the Administrative Agent in writing of
any mandatory prepayment of Term Loans required to be made pursuant to
clause (i) of this Section 2.05(b) at least three (3) Business Days prior
to the date of such prepayment. Each such notice shall specify the date of
such prepayment and provide a reasonably detailed calculation of the amount
of such prepayment. The Administrative Agent will promptly notify each Term
Lender of the contents of the Borrower's prepayment notice and of such Term
Lender's Pro Rata Share of the prepayment.
(v) FUNDING LOSSES, ETC. All prepayments under this Section 2.05 shall
be made together with, in the case of any such prepayment of a Eurocurrency
Rate Loan on a date other than the last day of an Interest Period therefor,
any amounts owing in respect of such Eurocurrency Rate Loan pursuant to
Section 3.05. Notwithstanding any of the other provisions of Section
2.05(b), so long as no Event of Default shall have occurred and be
continuing, if any prepayment of Eurocurrency Rate Loans is required to be
made under this Section 2.05(b) other than on the last day of the Interest
Period therefor, the Borrower may, in its sole discretion, deposit the
amount of any such prepayment otherwise required to be made thereunder into
a Cash Collateral Account until the last day of such Interest Period, at
which time the Administrative Agent shall be authorized (without any
further action by or notice to or from the Borrower or any other Loan
Party) to apply such amount to the prepayment of such Loans in
accordance with this Section 2.05(b). Upon the occurrence and during
the continuance of any Event of Default, the Administrative Agent
shall also be authorized (without any further action by or notice to
or from the Borrower or any other Loan Party) to apply such amount to
the prepayment of the outstanding Loans in accordance with this
Section 2.05(b).
SECTION 2.06. TERMINATION OR REDUCTION OF COMMITMENTS. (a) OPTIONAL.
The Borrower may, upon written notice to the Administrative Agent, terminate the
unused Commitments of any Class, or from time to time permanently reduce the
unused Commitments of any Class; PROVIDED that (i) any such notice shall be
received by the Administrative Agent three (3) Business Days prior to the date
of termination or reduction and (ii) any such partial reduction shall be in an
aggregate amount of $1,000,000 or any whole multiple of $500,000 in excess
thereof. Notwithstanding the foregoing, the Borrower may rescind or postpone any
notice of termination of the Commitments if such termination would have resulted
from a
56
refinancing of all of the Facilities, which refinancing shall not be consummated
or otherwise shall be delayed.
(b) MANDATORY. The Term Commitment of each Term Lender shall be
automatically and permanently reduced to $0 upon the making of such Term
Lender's Term Loans pursuant to Section 2.01(a).
(c) APPLICATION OF COMMITMENT REDUCTIONS; PAYMENT OF FEES. The
Administrative Agent will promptly notify the Lenders of any termination or
reduction of unused Commitments of any Class under this Section 2.06. Upon any
reduction of unused Commitments of any Class, the Commitment of each Lender of
such Class shall be reduced by such Lender's Pro Rata Share of the amount by
which such Commitments are reduced (other than the termination of the Commitment
of any Lender as provided in Section 3.07). All commitment fees accrued until
the effective date of any termination of the Aggregate Commitments shall be paid
on the effective date of such termination.
SECTION 2.07. REPAYMENT OF LOANS. (a) TERM LOANS. The Borrower shall
repay to the Administrative Agent for the ratable account of the Term Lenders
(i) on the last Business Day of each March, June, September and December,
commencing on June 30, 2006, an aggregate principal amount equal to 0.25% of the
aggregate principal amount of all Term Loans outstanding on the Closing Date
(which payments shall be reduced as a result of the application of prepayments
in accordance with the order of priority set forth in Section 2.05) and (ii) on
the Maturity Date for the Term Loans, the aggregate principal amount of all Term
Loans outstanding on such date.
(b) REVOLVING CREDIT LOANS. The Borrower shall repay to the
Administrative Agent for the ratable account of the Revolving Credit Lenders on
the Maturity Date for the Revolving Credit Facility the aggregate principal
amount of all Revolving Credit Loans outstanding on such date.
SECTION 2.08. INTEREST. (a) Subject to the provisions of Section
2.08(b), (i) each Eurocurrency Rate Loan shall bear interest on the outstanding
principal amount thereof for each Interest Period at a rate per annum equal to
the Eurocurrency Rate for such Interest Period plus the Applicable Rate, and
(ii) each Base Rate Loan shall bear interest on the outstanding principal amount
thereof from the applicable borrowing date at a rate per annum equal to the Base
Rate plus the Applicable Rate.
(b) The Borrower shall pay interest on past due amounts hereunder at a
fluctuating interest rate per annum at all times equal to the Default Rate to
the fullest extent permitted by applicable Laws. Accrued and unpaid interest on
past due amounts (including interest on past due interest) shall be due and
payable upon demand.
(c) Interest on each Loan shall be due and payable in arrears on each
Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.
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SECTION 2.09. FEES. In addition to certain fees described in Sections
2.03(h) and (i):
(a) COMMITMENT FEE. The Borrower shall pay to the Administrative Agent
for the account of each Revolving Credit Lender in accordance with its Pro Rata
Share, a commitment fee equal to the Applicable Rate with respect to commitment
fees times the actual daily amount by which the aggregate Revolving Credit
Commitment exceeds the sum of (A) Outstanding Amount of Revolving Credit Loans
and (B) the Outstanding Amount of L/C Obligations; PROVIDED that any commitment
fee accrued with respect to any of the Commitments of a Defaulting Lender during
the period prior to the time such Lender became a Defaulting Lender and unpaid
at such time shall not be payable by the Borrower so long as such Lender shall
be a Defaulting Lender except to the extent that such commitment fee shall
otherwise have been due and payable by the Borrower prior to such time; and
PROVIDED FURTHER that no commitment fee shall accrue on any of the Commitments
of a Defaulting Lender so long as such Lender shall be a Defaulting Lender. The
commitment fee shall accrue at all times from the date hereof until the Maturity
Date for the Revolving Credit Facility, including at any time during which one
or more of the conditions in Article IV is not met, and shall be due and payable
quarterly in arrears on the third Business Day after the end of each March,
June, September and December, commencing with the first such date to occur after
the Closing Date, and on the Maturity Date for the Revolving Credit Facility.
The commitment fee shall be calculated quarterly in arrears.
(b) OTHER FEES. The Borrower shall pay to the Agents such fees as
shall have been separately agreed upon in writing in the amounts and at the
times so specified. Such fees shall be fully earned when paid and shall not be
refundable for any reason whatsoever (except as expressly agreed between the
Borrower and the applicable Agent).
SECTION 2.10. COMPUTATION OF INTEREST AND FEES. All computations of
interest for Base Rate Loans when the Base Rate is determined by JPMorgan Chase
Bank's "prime rate" shall be made on the basis of a year of three hundred and
sixty-five (365) days (or three hundred and sixty-six (366) days in a leap year)
and actual days elapsed. All other computations of fees and interest shall be
made on the basis of a three hundred and sixty (360) day year and actual days
elapsed. Interest shall accrue on each Loan for the day on which the Loan is
made, and shall not accrue on a Loan, or any portion thereof, for the day on
which the Loan or such portion is paid; PROVIDED that any Loan that is repaid on
the same day on which it is made shall, subject to Section 2.12(a), bear
interest for one (1) day. Each determination by the Administrative Agent of an
interest rate or fee hereunder shall be conclusive and binding for all purposes,
absent manifest error.
SECTION 2.11. EVIDENCE OF INDEBTEDNESS. (a) The Credit Extensions made
by each Lender shall be evidenced by one or more accounts or records maintained
by such Lender and evidenced by one or more entries in the Register maintained
by the Administrative Agent, acting solely for purposes of Treasury Regulation
Section 5f.103-1(c), as agent for the Borrower, in each case in the ordinary
course of business. The accounts or records maintained by the Administrative
Agent and each Lender shall be
58
PRIMA FACIE evidence absent manifest error of the amount of the Credit
Extensions made by the Lenders to the Borrower and the interest and payments
thereon. Any failure to so record or any error in doing so shall not, however,
limit or otherwise affect the obligation of the Borrower hereunder to pay any
amount owing with respect to the Obligations. In the event of any conflict
between the accounts and records maintained by any Lender and the accounts and
records of the Administrative Agent in respect of such matters, the accounts and
records of the Administrative Agent shall control in the absence of manifest
error. Upon the request of any Lender made through the Administrative Agent, the
Borrower shall execute and deliver to such Lender (through the Administrative
Agent) a Note payable to such Lender, which shall evidence such Lender's Loans
in addition to such accounts or records. Each Lender may attach schedules to its
Note and endorse thereon the date, Type (if applicable), amount and maturity of
its Loans and payments with respect thereto.
(b) In addition to the accounts and records referred to in Section
2.11(a), each Lender and the Administrative Agent shall maintain in accordance
with its usual practice accounts or records and, in the case of the
Administrative Agent, entries in the Register, evidencing the purchases and
sales by such Lender of participations in Letters of Credit. In the event of any
conflict between the accounts and records maintained by the Administrative Agent
and the accounts and records of any Lender in respect of such matters, the
accounts and records of the Administrative Agent shall control in the absence of
manifest error.
(c) Entries made in good faith by the Administrative Agent in the
Register pursuant to Sections 2.11(a) and (b), and by each Lender in its account
or accounts pursuant to Sections 2.11(a) and (b), shall be PRIMA FACIE evidence
of the amount of principal and interest due and payable or to become due and
payable from the Borrower to, in the case of the Register, each Lender and, in
the case of such account or accounts, such Lender, under this Agreement and the
other Loan Documents, absent manifest error; PROVIDED that the failure of the
Administrative Agent or such Lender to make an entry, or any finding that an
entry is incorrect, in the Register or such account or accounts shall not limit
or otherwise affect the obligations of the Borrower under this Agreement and the
other Loan Documents.
SECTION 2.12. PAYMENTS GENERALLY. (a) Except as otherwise required by
Sections 3.01 and 10.15, all payments to be made by the Borrower shall be made
without condition or deduction for any counterclaim, defense, recoupment or
setoff. Except as otherwise expressly provided herein, all payments by the
Borrower hereunder shall be made to the Administrative Agent, for the account of
the respective Lenders to which such payment is owed, to the account of the
Administrative Agent most recently designated by it for such purpose by notice
to the Borrower in U.S. dollars and in immediately available funds not later
than 2:00 p.m. on the date specified herein. The Administrative Agent will
promptly distribute to each Lender its Pro Rata Share (or other applicable share
as provided herein) of such payment in like funds as received by wire transfer
to such Lender's Lending Office. All payments received by the Administrative
Agent after 2:00 p.m. shall in each case be deemed received on the next
succeeding Business Day and any applicable interest or fee shall continue to
accrue.
59
(b) If any payment to be made by the Borrower shall come due on a day
other than a Business Day, payment shall be made on the next following Business
Day, and such extension of time shall be reflected in computing interest or
fees, as the case may be; PROVIDED that, if such extension would cause payment
of interest on or principal of Eurocurrency Rate Loans to be made in the next
succeeding calendar month, such payment shall be made on the immediately
preceding Business Day.
(c) Unless the Borrower or any Lender has notified the Administrative
Agent, prior to the date any payment is required to be made by it to the
Administrative Agent hereunder, that the Borrower or such Lender, as the case
may be, will not make such payment, the Administrative Agent may assume that the
Borrower or such Lender, as the case may be, has timely made such payment and
may (but shall not be so required to), in reliance thereon, make available a
corresponding amount to the Person entitled thereto. If and to the extent that
such payment was not in fact made to the Administrative Agent in immediately
available funds, then:
(i) if the Borrower failed to make such payment, each Lender shall
forthwith on demand repay to the Administrative Agent the portion of
such assumed payment that was made available to such Lender in
immediately available funds, together with interest thereon in respect
of each day from and including the date such amount was made available
by the Administrative Agent to such Lender to the date such amount is
repaid to the Administrative Agent in immediately available funds at
the Federal Funds Rate from time to time in effect; and
(ii) if any Lender failed to make such payment, such Lender shall
forthwith on demand pay to the Administrative Agent the amount thereof
in immediately available funds, together with interest thereon for the
period from the date such amount was made available by the
Administrative Agent to the Borrower to the date such amount is
recovered by the Administrative Agent (the "COMPENSATION PERIOD") at a
rate per annum equal to the Federal Funds Rate from time to time in
effect. When such Lender makes payment to the Administrative Agent
(together with all accrued interest thereon), then such payment amount
(excluding the amount of any interest which may have accrued and been
paid in respect of such late payment) shall constitute such Lender's
Loan included in the applicable Borrowing. If such Lender does not pay
such amount forthwith upon the Administrative Agent's demand therefor,
the Administrative Agent may make a demand therefor upon the Borrower,
and the Borrower shall pay such amount to the Administrative Agent,
together with interest thereon for the Compensation Period at a rate
per annum equal to the rate of interest applicable to the applicable
Borrowing. Nothing herein shall be deemed to relieve any Lender from
its obligation to fulfill its Commitment or to prejudice any rights
which the Administrative Agent or the Borrower may have against any
Lender as a result of any default by such Lender hereunder.
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A notice of the Administrative Agent to any Lender or the Borrower
with respect to any amount owing under this Section 2.12(c) shall be conclusive,
absent manifest error.
(d) If any Lender makes available to the Administrative Agent funds
for any Loan to be made by such Lender as provided in the foregoing provisions
of this Article II, and such funds are not made available to the Borrower by the
Administrative Agent because the conditions to the applicable Credit Extension
set forth in Article IV are not satisfied or waived in accordance with the terms
hereof, the Administrative Agent shall return such funds to such Lender, without
interest.
(e) The obligations of the Lenders hereunder to make Loans and to fund
participations in Letters of Credit are several and not joint. The failure of
any Lender to make any Loan or to fund any such participation on any date
required hereunder shall not relieve any other Lender of its corresponding
obligation to do so on such date, and no Lender shall be responsible for the
failure of any other Lender to so make its Loan or purchase its participation.
(f) Nothing herein shall be deemed to obligate any Lender to obtain
the funds for any Loan in any particular place or manner or to constitute a
representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.
(g) Whenever any payment received by the Administrative Agent under
this Agreement or any of the other Loan Documents is insufficient to pay in full
all amounts due and payable to the Administrative Agent and the Lenders under or
in respect of this Agreement and the other Loan Documents on any date, such
payment shall be distributed by the Administrative Agent and applied by the
Administrative Agent and the Lenders in the order of priority set forth in
Section 8.03. If the Administrative Agent receives funds for application to the
Obligations of the Loan Parties under or in respect of the Loan Documents under
circumstances for which the Loan Documents do not specify the manner in which
such funds are to be applied, the Administrative Agent may, but shall not be
obligated to, elect to distribute such funds to each of the Lenders in
accordance with such Lender's Pro Rata Share of the sum of (a) the Outstanding
Amount of all Loans outstanding at such time and (b) the Outstanding Amount of
all L/C Obligations outstanding at such time, in repayment or prepayment of such
of the outstanding Loans or other Obligations then owing to such Lender.
SECTION 2.13. SHARING OF PAYMENTS. If, other than as expressly
provided elsewhere herein, any Lender shall obtain on account of the Loans made
by it, or the participations in L/C Obligations held by it, any payment (whether
voluntary, involuntary, through the exercise of any right of setoff, or
otherwise) in excess of its ratable share (or other share contemplated
hereunder) thereof, such Lender shall immediately (a) notify the Administrative
Agent of such fact, and (b) purchase from the other Lenders such participations
in the Loans made by them and/or such subparticipations in the participations in
L/C Obligations held by them, as the case may be, as shall be necessary to cause
such purchasing Lender to share the excess payment in
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respect of such Loans or such participations, as the case may be, pro rata with
each of them; PROVIDED that (i) if all or any portion of such excess payment is
thereafter recovered from the purchasing Lender under any of the circumstances
described in Section 10.06 (including pursuant to any settlement entered into by
the purchasing Lender in its discretion), such purchase shall to that extent be
rescinded and each other Lender shall repay to the purchasing Lender the
purchase price paid therefor, together with an amount equal to such paying
Lender's ratable share (according to the proportion of (x) the amount of such
paying Lender's required repayment to (y) the total amount so recovered from the
purchasing Lender) of any interest or other amount paid or payable by the
purchasing Lender in respect of the total amount so recovered, without further
interest thereon 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 L/C Obligations to any assignee or participant, other than to
the Borrower or any Subsidiary or other Affiliate thereof (as to which the
provisions of this paragraph shall apply). The Borrower agrees that any Lender
so purchasing a participation from another Lender may, to the fullest extent
permitted by applicable Law, exercise all its rights of payment (including the
right of setoff, but subject to Section 10.09) with respect to such
participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation. The Administrative Agent will keep
records (which shall be conclusive and binding in the absence of manifest error)
of participations purchased under this Section 2.13 and will in each case notify
the Lenders following any such purchases or repayments. Each Lender that
purchases a participation pursuant to this Section 2.13 shall from and after
such purchase have the right to give all notices, requests, demands, directions
and other communications under this Agreement with respect to the portion of the
Obligations purchased to the same extent as though the purchasing Lender were
the original owner of the Obligations purchased.
SECTION 2.14. INCREMENTAL CREDIT EXTENSIONS. The Borrower may at any
time or from time to time after the Closing Date, by notice to the
Administrative Agent (whereupon the Administrative Agent shall promptly deliver
a copy to each of the Lenders), request one or more additional tranches of term
loans (the "INCREMENTAL TERM LOANS"); PROVIDED that (i) both at the time of any
such request and upon the effectiveness of any Incremental Amendment referred to
below, no Default or Event of Default shall exist and at the time that any such
Incremental Term Loan is made (and after giving effect thereto) no Default or
Event of Default shall exist and (ii) the Borrower shall be in compliance with
each of the covenants set forth in Section 7.09 determined on a Pro Forma Basis
as of the last day of the most recent Test Period. The aggregate principal
amount of the Incremental Term Loans shall not exceed $100,000,000 and the
principal amount of each Incremental Term Loan shall not be less than
$25,000,000. The Incremental Term Loans (a) shall rank PARI PASSU or junior in
right of payment and of security with the Revolving Credit Loans and the Term
Loans, (b) shall not mature earlier than the Maturity Date with respect to the
Term Loans and shall have a Weighted Average Life to Maturity no shorter than
the Weighted Average Life to Maturity of the Term Facility, (c) except as set
forth above, shall be treated substantially the same as (and in any event, no
more favorably than) the Term Loans (in each case, including with
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respect to mandatory and voluntary prepayments) and (d) will accrue interest at
rates determined by the Borrower and the lenders providing such Incremental Term
Loans, which rates may be higher or lower than the rates applicable to the Term
Loans; PROVIDED that (i) if the Applicable Rate (which, for such purposes only,
shall be deemed to include all upfront or similar fees or original issue
discount payable to all Lenders providing such Incremental Term Loans) relating
to the Incremental Term Loans exceeds the Applicable Rate relating to the Term
Loans by more than 0.25%, the Applicable Rate relating to the Term Loans shall
be adjusted to be equal to the Applicable Rate (which, for such purposes only,
shall be deemed to include all upfront or similar fees or original issue
discount payable to all Lenders providing such Incremental Term Loans) relating
to the applicable Incremental Term Loans minus 0.25%. Each notice from the
Borrower pursuant to this Section shall set forth the requested amount and
proposed terms of the relevant Incremental Term Loans. Incremental Term Loans
may be made by any existing Lender (and each existing Term Lender will have the
right, but not an obligation, to make a portion of any Incremental Term Loan
equal to its pro rata share of the Term Loans, on terms permitted in this
Section 2.14 and otherwise on terms reasonably acceptable to the Administrative
Agent) or by any other bank or other financial institution (any such other bank
or other financial institution being called an "ADDITIONAL LENDER"), PROVIDED
that (1) the Administrative Agent shall have consented (not to be unreasonably
withheld) to such Lender's or Additional Lender's making such Incremental Term
Loans if such consent would be required under Section 10.07(b) for an assignment
of Loans to such Lender or Additional Lender. Commitments in respect of
Incremental Term Loans shall become Commitments under this Agreement pursuant to
an amendment (an "INCREMENTAL AMENDMENT") to this Agreement and, as appropriate,
the other Loan Documents, executed by Holdings, the Borrower, each Lender
agreeing to provide such Commitment, if any, each Additional Lender, if any, and
the Administrative Agent. The Incremental Amendment may, without the consent of
any other Lenders, effect such amendments to this Agreement and the other Loan
Documents as may be necessary or appropriate, in the reasonable opinion of the
Administrative Agent and the Borrower, to effect the provisions of this Section.
The effectiveness of any Incremental Amendment shall be subject to the
satisfaction on the date thereof (each, an "INCREMENTAL FACILITY CLOSING DATE")
of each of the conditions set forth in Section 4.02 (it being understood that
all references to "the date of such Credit Extension" or similar language in
such Section 4.02 shall be deemed to refer to the effective date of such
Incremental Amendment) and such other conditions as the parties thereto shall
agree. The Borrower will use the proceeds of the Incremental Term Loans for
general corporate purposes. No Lender shall be obligated to provide any
Incremental Term Loans unless it so agrees.
ARTICLE III
TAXES, INCREASED COSTS PROTECTION AND ILLEGALITY
SECTION 3.01. TAXES. (a) Except as provided in this Section 3.01, any
and all payments by the Borrower (the term Borrower under Article III being
deemed to include any Subsidiary for whose account a Letter of Credit is issued)
to or for the account of any Agent or any Lender under any Loan Document shall
be made free and clear of and without deduction for any and all present or
future taxes, duties, levies,
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imposts, deductions, assessments, fees, withholdings or similar charges,
(including additions to tax, penalties and interest with respect thereto)
imposed by any Governmental Authority ("TAXES"), excluding, in the case of each
Agent and each Lender, Taxes imposed on or measured by its net income or gross
income (including branch profits (or similar) Taxes), and franchise (and
similar) Taxes imposed on it in lieu of net income Taxes, (i) by the
jurisdiction (or any political subdivision thereof) under the Laws of which such
Agent or such Lender, as the case may be, is organized or maintains a Lending
Office, or (ii) by any jurisdiction (or any political subdivision thereof) as a
result of a present or former connection between such Agent or such Lender, as
the case may be, and the jurisdiction (or any political subdivision thereof)
imposing such Taxes (other than any such connection arising solely from the
Administrative Agent or Lender having executed, delivered or performed its
obligations or received a payment under, or enforced, this Agreement or any
other Loan Documents), in each case including all liabilities (including
additions to tax, penalties and interest) with respect thereto (such excluded
Taxes being hereinafter referred to as "EXCLUDED TAXES" and all Taxes other than
Excluded Taxes and Other Taxes being hereinafter referred to as "NON-EXCLUDED
TAXES"). If the Borrower shall be required by any Laws to deduct any
Non-Excluded Taxes or Other Taxes from or in respect of any sum payable under
any Loan Document to any Agent or any Lender, (i) the sum payable shall be
increased as necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section 3.01), each
of such Agent and such Lender receives an amount equal to the sum it would have
received had no such deductions with respect to Non-Excluded Taxes or Other
Taxes been made, (ii) the Borrower shall make such deductions, (iii) the
Borrower shall pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable Laws, and (iv) within thirty
(30) days after the date of such payment (or, if receipts or evidence are not
available within thirty (30) days, as soon as possible thereafter), the Borrower
shall furnish to such Agent or Lender (as the case may be) the original or a
certified copy of a receipt evidencing payment thereof (to the extent such a
receipt is issued therefor), or other written proof of payment thereof that is
reasonably satisfactory to the Administrative Agent. If the Borrower shall have
been required by any Laws to deduct and pay any Non-Excluded or Other Taxes and
fails to pay any Non-Excluded Taxes or Other Taxes when due to the appropriate
Governmental Authority or fails to remit to any Agent or any Lender the required
receipts or other required documentary evidence with respect to such payment,
the Borrower shall indemnify such Agent and such Lender for any incremental
Taxes that become payable by such Agent or such Lender arising out of such
failure.
(b) In addition, the Borrower agrees to pay any and all present or
future stamp, court or documentary Taxes and any other excise, property,
intangible or mortgage recording Taxes or charges or similar levies that arise
from any payment made under any Loan Document or from the execution, delivery,
performance, enforcement or registration of, or otherwise with respect to, any
Loan Document (hereinafter referred to as "OTHER TAXES").
(c) The Borrower agrees to indemnify each Agent and each Lender for
(i) the full amount of Non-Excluded Taxes and Other Taxes (including any
Non-Excluded Taxes or Other Taxes imposed or asserted by any jurisdiction on
amounts
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payable under this Section 3.01) paid by such Agent and such Lender and (ii) any
liability (including additions to tax, penalties, interest and expenses) arising
therefrom or with respect thereto, in each case whether or not such Non-Excluded
Taxes or Other Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority; PROVIDED such Agent or Lender, as the case may
be, provides the Borrower with a written statement thereof setting forth in
reasonable detail the basis and calculation of such amounts. Payment under this
Section 3.01(c) shall be made within thirty (30) days after the date such Lender
or such Agent makes a demand therefor.
(d) The Borrower shall not be required pursuant to this Section 3.01
to pay any additional amount to, or to indemnify, any Lender or Agent, as the
case may be, to the extent that such Lender or such Agent becomes subject to
Non-Excluded Taxes subsequent to the Closing Date (or, if later, the date such
Lender or Agent becomes a party to this Agreement) as a result of a change in
the place of organization of such Lender or Agent or a change in the lending
office of such Lender, except to the extent that any such change is requested or
required in writing by the Borrower (and provided that nothing in this clause
(d) shall be construed as relieving the Borrower from any obligation to make
such payments or indemnification in the event of a change in lending office or
place of organization that precedes a change in Law to the extent such
Non-Excluded Taxes result from a change in Law).
(e) Notwithstanding anything else herein to the contrary, if a Lender
or an Agent is subject to withholding Tax imposed by any jurisdiction in which
the Borrower is formed or organized at a rate in excess of zero percent at the
time such Lender or such Agent, as the case may be, first becomes a party to
this Agreement, withholding Tax imposed by such jurisdiction at such rate shall
be considered excluded from Non-Excluded Taxes unless and until such Lender or
Agent, as the case may be, provides the appropriate forms certifying that a
complete exemption or lesser rate applies, whereupon withholding Tax at such
lesser rate (or zero percent if a complete exemption is available) only shall be
considered excluded from Non-Excluded Taxes for periods governed by such forms;
PROVIDED that, if at the date of the Assignment and Acceptance pursuant to which
a Lender becomes a party to this Agreement, the Lender assignor was entitled to
payments under clause (a) of this Section 3.01 in respect of withholding Tax
with respect to interest paid at such date, then, to such extent, the term
Non-Excluded Taxes shall include (in addition to withholding taxes that may be
imposed in the future or other amounts otherwise includable in Non-Excluded
Taxes) withholding Tax, if any, applicable with respect to the Lender assignee
on such date.
(f) If any Lender or Agent determines, in its reasonable discretion,
that it has received a refund in respect of any Non-Excluded Taxes or Other
Taxes as to which indemnification or additional amounts have been paid to it by
the Borrower pursuant to this Section 3.01, it shall promptly remit such refund
(but only to the extent of indemnity payments made, or additional amounts paid,
by the Borrower under this Section 3.01 with respect to the Non-Excluded Taxes
or Other Taxes giving rise to such refund plus any interest included in such
refund by the relevant taxing authority attributable thereto) to the Borrower,
net of all out-of-pocket expenses of the Lender or Agent, as the case may be and
without interest (other than any interest paid by the relevant taxing authority
with
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respect to such refund); PROVIDED that the Borrower, upon the request of the
Lender or Agent, as the case may be, agrees promptly to return such refund to
such party in the event such party is required to repay such refund to the
relevant taxing authority. Such Lender or Agent, as the case may be, shall, at
the Borrower's request, provide the Borrower with a copy of any notice of
assessment or other evidence of the requirement to repay such refund received
from the relevant taxing authority (PROVIDED that such Lender or Agent may
delete any information therein that such Lender or Agent deems confidential).
Nothing herein contained shall interfere with the right of a Lender or Agent to
arrange its tax affairs in whatever manner it thinks fit nor oblige any Lender
or Agent to claim any tax refund or to make available its tax returns or
disclose any information relating to its tax affairs or any computations in
respect thereof or require any Lender or Agent to do anything that would
prejudice its ability to benefit from any other refunds, credits, reliefs,
remissions or repayments to which it may be entitled.
(g) Each Lender agrees that, upon the occurrence of any event giving
rise to the operation of Section 3.01(a) or (c) with respect to such Lender it
will, if requested by the Borrower, use commercially reasonable efforts (subject
to such Lender's overall internal policies of general application and legal and
regulatory restrictions) to designate another Lending Office for any Loan or
Letter of Credit affected by such event; PROVIDED that such efforts are made on
terms that, in the sole judgment of such Lender, cause such Lender and its
Lending Office(s) to suffer no economic, legal or regulatory disadvantage; and
PROVIDED FURTHER that nothing in this Section 3.01(g) shall affect or postpone
any of the Obligations of the Borrower or the rights of such Lender pursuant to
Section 3.01(a) or (c).
SECTION 3.02. ILLEGALITY. If any Lender determines that any Law has
made it unlawful, or that any Governmental Authority has asserted that it is
unlawful, for any Lender or its applicable Lending Office to make, maintain or
fund Eurocurrency Rate Loans, or to determine or charge interest rates based
upon the Eurocurrency Rate, then, on notice thereof by such Lender to the
Borrower through the Administrative Agent, any obligation of such Lender to make
or continue Eurocurrency Rate Loans or to convert Base Rate Loans to
Eurocurrency Rate Loans shall be suspended until such Lender notifies the
Administrative Agent and the Borrower that the circumstances giving rise to such
determination no longer exist. Upon receipt of such notice, the Borrower shall
upon demand from such Lender (with a copy to the Administrative Agent), prepay
or, if applicable, convert all Eurocurrency Rate Loans of such Lender to Base
Rate Loans, either on the last day of the Interest Period therefor, if such
Lender may lawfully continue to maintain such Eurocurrency Rate Loans to such
day, or promptly, if such Lender may not lawfully continue to maintain such
Eurocurrency Rate Loans. Upon any such prepayment or conversion, the Borrower
shall also pay accrued interest on the amount so prepaid or converted and all
amounts due, if any, in connection with such prepayment or conversion under
Section 3.05. Each Lender agrees to designate a different Lending Office if such
designation will avoid the need for such notice and will not, in the good faith
judgment of such Lender, otherwise be materially disadvantageous to such Lender.
SECTION 3.03. INABILITY TO DETERMINE RATES. If the Required Lenders
determine that for any reason adequate and reasonable means do not exist for
determining
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the Eurocurrency Rate for any requested Interest Period with respect to a
proposed Eurocurrency Rate Loan, or that the Eurocurrency Rate for any requested
Interest Period with respect to a proposed Eurocurrency Rate Loan does not
adequately and fairly reflect the cost to such Lenders of funding such Loan, or
that U.S. dollar deposits are not being offered to banks in the London interbank
eurodollar market for the applicable amount and the Interest Period of such
Eurocurrency Rate Loan, the Administrative Agent will promptly so notify the
Borrower and each Lender. Thereafter, the obligation of the Lenders to make or
maintain Eurocurrency Rate Loans shall be suspended until the Administrative
Agent (upon the instruction of the Required Lenders) revokes such notice. Upon
receipt of such notice, the Borrower may revoke any pending request for a
Borrowing of, conversion to or continuation of Eurocurrency Rate Loans or,
failing that, will be deemed to have converted such request into a request for a
Borrowing of Base Rate Loans in the amount specified therein.
SECTION 3.04. INCREASED COST AND REDUCED RETURN; CAPITAL ADEQUACY;
RESERVES ON EUROCURRENCY RATE LOANS. (a) If any Lender determines that as a
result of the introduction of or any change in or in the interpretation of any
Law, in each case after the date hereof, or such Lender's compliance therewith,
there shall be any increase in the cost to such Lender of agreeing to make or
making, funding or maintaining Eurocurrency Rate Loans or (as the case may be)
issuing or participating in Letters of Credit, or a reduction in the amount
received or receivable by such Lender in connection with any of the foregoing
(excluding for purposes of this Section 3.04(a) any such increased costs or
reduction in amount resulting from (i) Non-Excluded Taxes or Other Taxes (as to
which Section 3.01 shall govern), (ii) Excluded Taxes and (iii) reserve
requirements contemplated by Section 3.04(c)), then from time to time within
fifteen (15) days after demand by such Lender setting forth in reasonable detail
such increased costs (with a copy of such demand to the Administrative Agent
given in accordance with Section 3.06), the Borrower shall pay to such Lender
such additional amounts as will compensate such Lender for such increased cost
or reduction.
(b) If any Lender determines that the introduction of any Law
regarding capital adequacy or any change therein or in the interpretation
thereof, in each case after the date hereof, or compliance by such Lender (or
its Lending Office) therewith, has the effect of reducing the rate of return on
the capital of such Lender or any corporation controlling such Lender as a
consequence of such Lender's obligations hereunder (taking into consideration
its policies with respect to capital adequacy and such Lender's desired return
on capital), then from time to time upon demand of such Lender setting forth in
reasonable detail the charge and the calculation of such reduced rate of return
(with a copy of such demand to the Administrative Agent given in accordance with
Section 3.06), the Borrower shall pay to such Lender such additional amounts as
will compensate such Lender for such reduction within fifteen (15) days after
receipt of such demand.
(c) The Borrower shall pay to each Lender, (i) as long as such Lender
shall be required to maintain reserves with respect to liabilities or assets
consisting of or including Eurocurrency funds or deposits, additional interest
on the unpaid principal amount of each Eurocurrency Rate Loan equal to the
actual costs of such reserves
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allocated to such Loan by such Lender (as determined by such Lender in good
faith, which determination shall be conclusive in the absence of manifest
error), and (ii) as long as such Lender shall be required to comply with any
reserve ratio requirement or analogous requirement of any other central banking
or financial regulatory authority imposed in respect of the maintenance of the
Commitments or the funding of the Eurocurrency Rate Loans, such additional costs
(expressed as a percentage per annum and rounded upwards, if necessary, to the
nearest five decimal places) equal to the actual costs allocated to such
Commitment or Loan by such Lender (as determined by such Lender in good faith,
which determination shall be conclusive absent manifest error) which in each
case shall be due and payable on each date on which interest is payable on such
Loan, provided the Borrower shall have received at least fifteen (15) days'
prior notice (with a copy to the Administrative Agent) of such additional
interest or cost from such Lender. If a Lender fails to give notice fifteen (15)
days prior to the relevant Interest Payment Date, such additional interest or
cost shall be due and payable fifteen (15) days from receipt of such notice.
(d) Failure or delay on the part of any Lender to demand compensation
pursuant to this Section 3.04 shall not constitute a waiver of such Lender's
right to demand such compensation.
(e) If any Lender requests compensation under this Section 3.04, then
such Lender will, if requested by the Borrower, use commercially reasonable
efforts to designate another Lending Office for any Loan or Letter of Credit
affected by such event; PROVIDED that such efforts are made on terms that, in
the reasonable judgment of such Lender, cause such Lender and its Lending
Office(s) to suffer no material economic, legal or regulatory disadvantage; and
PROVIDED FURTHER that nothing in this Section 3.04(e) shall affect or postpone
any of the Obligations of the Borrower or the rights of such Lender pursuant to
Section 3.04(a), (b), (c) or (d).
SECTION 3.05. FUNDING LOSSES. Upon demand of any Lender (with a copy
to the Administrative Agent) from time to time, the Borrower shall promptly
compensate such Lender for and hold such Lender harmless from any loss, cost or
expense incurred by it as a result of:
(a) any conversion, payment or prepayment of any Eurocurrency
Rate Loan on a day other than the last day of the Interest Period for
such Loan; or
(b) any failure by the Borrower (for a reason other than the
failure of such Lender to make a Loan) to prepay, borrow, continue or
convert any Eurocurrency Rate Loan on the date or in the amount
notified by such Borrower;
including any loss or expense arising from the liquidation or reemployment of
funds obtained by it to maintain such Loan or from fees payable to terminate the
deposits from which such funds were obtained.
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For purposes of calculating amounts payable by the Borrower to the
Lenders under this Section 3.05, each Lender shall be deemed to have funded each
Eurocurrency Rate Loan made by it at the Eurocurrency Rate for such Loan by a
matching deposit or other borrowing in the London interbank eurodollar market
for a comparable amount and for a comparable period, whether or not such
Eurocurrency Rate Loan was in fact so funded.
SECTION 3.06. MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION. (a)
Any Agent or any Lender claiming compensation under this Article III shall
deliver a certificate to the Borrower setting forth the additional amount or
amounts to be paid to it hereunder which shall be conclusive in the absence of
manifest error. In determining such amount, such Agent or such Lender may use
any reasonable averaging and attribution methods.
(b) With respect to any Lender's claim for compensation under Section
3.01, 3.02 or 3.04, the Borrower shall not be required to compensate such Lender
for any amount incurred more than one hundred and eighty (180) days prior to the
date that such Lender notifies the Borrower of the event that gives rise to such
claim; PROVIDED that, if the circumstance giving rise to such claim is
retroactive, then such 180-day period referred to above shall be extended to
include the period of retroactive effect thereof. If any Lender requests
compensation by the Borrower under Section 3.04, the Borrower may, by notice to
such Lender (with a copy to the Administrative Agent), suspend the obligation of
such Lender to make or continue from one Interest Period to another Eurocurrency
Rate Loans, or to convert Base Rate Loans into Eurocurrency Rate Loans, until
the event or condition giving rise to such request ceases to be in effect (in
which case the provisions of Section 3.06(c) shall be applicable); PROVIDED that
such suspension shall not affect the right of such Lender to receive the
compensation so requested.
(c) If the obligation of any Lender to make or continue from one
Interest Period to another any Eurocurrency Rate Loan, or to convert Base Rate
Loans into Eurocurrency Rate Loans shall be suspended pursuant to Section 3.02,
3.03 or 3.06(b) hereof, such Lender's Eurocurrency Rate Loans shall be
automatically converted into Base Rate Loans on the last day(s) of the then
current Interest Period(s) for such Eurocurrency Rate Loans (or, in the case of
an immediate conversion required by Section 3.02, on such earlier date as
required by Law) and, unless and until such Lender gives notice as provided
below that the circumstances specified in Section 3.02, 3.03 or 3.04 hereof that
gave rise to such conversion no longer exist:
(i) to the extent that such Lender's Eurocurrency Rate Loans have been
so converted, all payments and prepayments of principal that would
otherwise be applied to such Lender's Eurocurrency Rate Loans shall be
applied instead to its Base Rate Loans; and
(ii) all Loans that would otherwise be made or continued from one
Interest Period to another by such Lender as Eurocurrency Rate Loans shall
be made or continued instead as Base Rate Loans, and all Base Rate Loans of
such Lender
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that would otherwise be converted into Eurocurrency Rate Loans shall remain
as Base Rate Loans.
(d) If any Lender gives notice to the Borrower (with a copy to the
Administrative Agent) that the circumstances specified in Section 3.02, 3.03 or
3.04 hereof that gave rise to the conversion of such Lender's Eurocurrency Rate
Loans pursuant to this Section 3.06 no longer exist (which such Lender agrees to
do promptly upon such circumstances ceasing to exist) at a time when
Eurocurrency Rate Loans made by other Lenders are outstanding, such Lender's
Base Rate Loans shall be automatically converted, on the first day(s) of the
next succeeding Interest Period(s) for such outstanding Eurocurrency Rate Loans,
to the extent necessary so that, after giving effect thereto, all Loans held by
the Lenders holding Eurocurrency Rate Loans and by such Lender are held pro rata
(as to principal amounts, interest rate basis, and Interest Periods) in
accordance with their respective Commitments.
SECTION 3.07. REPLACEMENT OF LENDERS UNDER CERTAIN CIRCUMSTANCES. (a)
If at any time (i) the Borrower becomes obligated to pay additional amounts or
indemnity payments described in Section 3.01 or 3.04 as a result of any
condition described in such Sections or any Lender ceases to make Eurocurrency
Rate Loans as a result of any condition described in Section 3.02 or Section
3.04 (as a result of the operation of Section 3.06), (ii) any Lender becomes a
Defaulting Lender or (iii) any Lender becomes a Non-Consenting Lender, then the
Borrower may, on ten (10) Business Days' prior written notice to the
Administrative Agent and such Lender, replace such Lender by causing such Lender
to (and such Lender shall be obligated to) assign pursuant to Section 10.07(b)
(with the assignment fee to be paid by the Borrower in such instance) all of its
rights and obligations under this Agreement to one or more Eligible Assignees;
PROVIDED that neither the Administrative Agent nor any Lender shall have any
obligation to the Borrower to find a replacement Lender or other such Person;
and PROVIDED FURTHER that (A) in the case of any such assignment resulting from
a claim for compensation under Section 3.04 or payments required to be made
pursuant to Section 3.01, such assignment will result in a reduction in such
compensation or payments and (B) in the case of any such assignment resulting
from a Lender becoming a Non-Consenting Lender, the applicable Eligible
Assignees shall have agreed to the applicable departure, waiver or amendment of
the Loan Documents.
(b) Any Lender being replaced pursuant to Section 3.07(a) above shall
(i) execute and deliver an Assignment and Assumption with respect to such
Lender's Commitment and outstanding Loans and participations in L/C Obligations
and (ii) deliver any Notes evidencing such Loans to the Borrower or
Administrative Agent. Pursuant to such Assignment and Assumption, (A) the
assignee Lender shall acquire all or a portion, as the case may be, of the
assigning Lender's Commitment and outstanding Loans and participations in L/C
Obligations, (B) all obligations of the Borrower owing to the assigning Lender
relating to the Loans and participations so assigned shall be paid in full by
the assignee Lender to such assigning Lender concurrently with such assignment
and assumption and (C) upon such payment and, if so requested by the assignee
Lender, delivery to the assignee Lender of the appropriate Note or Notes
executed by the Borrower, the assignee Lender shall become a Lender hereunder
and the assigning
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Lender shall cease to constitute a Lender hereunder with respect to such
assigned Loans, Commitments and participations, except with respect to
indemnification provisions under this Agreement, which shall survive as to such
assigning Lender.
(c) Notwithstanding anything to the contrary contained above, any
Lender that acts as an L/C Issuer may not be replaced hereunder at any time that
it has any Letter of Credit outstanding hereunder unless arrangements reasonably
satisfactory to such L/C Issuer (including the furnishing of a back-up standby
letter of credit in form and substance, and issued by an issuer reasonably
satisfactory to such L/C Issuer or the depositing of cash collateral into a cash
collateral account in amounts and pursuant to arrangements reasonably
satisfactory to such L/C Issuer) have been made with respect to each such
outstanding Letter of Credit and the Lender that acts as the Administrative
Agent may not be replaced hereunder except in accordance with the terms of
Section 9.09.
(d) In the event that (i) the Borrower or the Administrative Agent has
requested that the Lenders consent to a departure or waiver of any provisions of
the Loan Documents or agree to any amendment thereto, (ii) the consent, waiver
or amendment in question requires the agreement of all affected Lenders in
accordance with the terms of Section 10.01 or all the Lenders with respect to a
certain Class of the Loans and (iii) the Required Lenders or Lenders holding
more than 50% of any Class of Commitments, as applicable, have agreed to such
consent, waiver or amendment, then any Lender who does not agree to such
consent, waiver or amendment shall be deemed a "NON-CONSENTING LENDER".
SECTION 3.08. SURVIVAL. All of the Borrower's obligations under this
Article III shall survive termination of the Aggregate Commitments and repayment
of all other Obligations hereunder.
ARTICLE IV
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS
SECTION 4.01. CONDITIONS OF INITIAL CREDIT EXTENSION. The obligation
of each Lender to make its initial Credit Extension hereunder is subject to
satisfaction of the following conditions precedent:
(a) The Administrative Agent's receipt of the following, each of which
shall be originals or facsimiles (followed promptly by originals) unless
otherwise specified, each properly executed by a Responsible Officer of the
signing Loan Party, each in form and substance reasonably satisfactory to the
Administrative Agent and its legal counsel:
(i) executed counterparts of this Agreement and each Guaranty;
(ii) a Note executed by the Borrower in favor of each Lender that has
requested a Note at least two Business Days in advance of the Closing Date;
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(iii) each Collateral Document set forth on Schedule 1.01A, duly
executed by each Loan Party thereto, together with:
(A) certificates, if any, representing the Pledged Equity
referred to therein accompanied by undated stock powers executed in
blank; and
(B) evidence that all other actions, recordings and filings
that the Administrative Agent may deem reasonably necessary to satisfy
the Collateral and Guarantee Requirement shall have been taken,
completed or otherwise provided for in a manner reasonably
satisfactory to the Administrative Agent;
(iv) such certificates of resolutions or other action, incumbency
certificates and/or other certificates of Responsible Officers of each Loan
Party as the Administrative Agent may reasonably require evidencing the
identity, authority and capacity of each Responsible Officer thereof
authorized to act as a Responsible Officer in connection with this
Agreement and the other Loan Documents to which such Loan Party is a party
or is to be a party on the Closing Date;
(v) opinions from (A) Wachtell, Lipton, ▇▇▇▇▇ & ▇▇▇▇, New York counsel
to the Loan Parties, substantially in the form of Exhibit G-1 and (B)
▇▇▇▇▇ ▇. ▇▇▇▇, General Counsel of the Borrower, substantially in the form
of Exhibit G-2;
(vi) a certificate signed by a Responsible Officer of the Borrower
certifying that there has been no change, effect, event or occurrence
since June 30, 2005, that has had or would reasonably be expected to
result in a Material Adverse Change;
(vii) a certificate attesting to the Solvency of the Loan Parties
(taken as a whole) after giving effect to the Transaction, from the Chief
Financial Officer of the Borrower;
(viii)evidence that all insurance required to be maintained pursuant
to the Loan Documents has been obtained and is in effect; and
(ix) a Committed Loan Notice or Letter of Credit Application, as
applicable, relating to the initial Credit Extensions.
(b) All fees and expenses required to be paid hereunder and invoiced
before the Closing Date shall have been paid in full in cash.
(c) Prior to or simultaneously with the initial Credit Extensions, (i)
the Equity Contribution shall have been made and (ii) the Mergers shall be
consummated in accordance with the terms of the Merger Agreement and in
accordance in all material respects with applicable Laws and regulatory
approvals and the Merger Agreement (and no provision of the Merger Agreement
shall have been waived, amended, supplemented
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or otherwise modified in a manner material and adverse to the Lenders without
the consent of the Arrangers (such consent not unreasonably to be withheld)).
(d) Prior to or simultaneously with the initial Credit Extensions, the
Borrower shall have received at least $100,000,000 in gross cash proceeds from
the issuance of the Junior Subordinated Notes.
(e) After giving effect to the Transaction, (i) Holdings and its
Subsidiaries shall have outstanding no material Indebtedness or preferred Equity
Interests other than (A) the Loans and L/C Obligations, (B) Student Loan Credit
Facilities in an aggregate principal amount not in excess of $150,000,000, (C)
the Junior Subordinated Notes and the Preferred Securities, (D) the Existing
Junior Subordinated Notes and Existing Preferred Securities, and (E)
Indebtedness listed on Schedule 7.03(b) and (ii) Holdings shall have outstanding
no Equity Interests (or securities convertible into or exchangeable for Equity
Interests or rights or options to acquire Equity Interests) other than common
stock owned by the Equity Investors.
(f) Holdings shall have a corporate rating assigned to it by S&P.
(g) Each of the Insurance Subsidiaries that is a Domestic Subsidiary
shall have received a financial strength rating from A.M. Best Company at least
forty-five (45) days prior to the Closing Date.
(h) The representations and warranties contained in the Merger
Agreement relating to the Company, its Subsidiaries and their respective
businesses that are material to the interests of the Lenders shall be true and
correct in all material respects on and as of the date of the initial Credit
Extension unless, as a result of any failure to be so true and correct, the
Investors do not have the right to terminate the Merger Agreement; PROVIDED that
any such representation and warranty that is qualified as to "materiality",
"Material Adverse Effect" or similar language shall be true and correct in all
respects on such date.
SECTION 4.02. CONDITIONS TO ALL CREDIT EXTENSIONS. The obligation of
each Lender to honor any Request for Credit Extension (other than a Committed
Loan Notice requesting only a conversion of Loans to the other Type, or a
continuation of Eurocurrency Rate Loans) is subject to the following conditions
precedent:
(a) The representations and warranties of the Borrower and each other
Loan Party contained in Article V or any other Loan Document (except, in the
case of the initial Credit Extensions, the representations contained in Sections
5.01(b), 5.05, 5.06, 5.07, 5.08, 5.09, 5.10, 5.11, 5.12, 5.14, 5.15, 5.16 and
5.18) shall be true and correct in all material respects on and as of the date
of such Credit Extension; PROVIDED that, to the extent that such representations
and warranties specifically refer to an earlier date, they shall be true and
correct in all material respects as of such earlier date; PROVIDED, FURTHER
that, any representation and warranty that is qualified as to "materiality",
"Material Adverse Effect" or similar language shall be true and correct in all
respects on such respective dates.
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(b) No Default shall exist, or would result from such proposed Credit
Extension or from the application of the proceeds therefrom.
(c) The Administrative Agent and, if applicable, the relevant L/C
Issuer shall have received a Request for Credit Extension in accordance with the
requirements hereof.
Each Request for Credit Extension (other than a Committed Loan Notice
requesting only a conversion of Loans to the other Type or a continuation of
Eurocurrency Rate Loans) submitted by the Borrower shall be deemed to be a
representation and warranty that the conditions specified in Sections 4.02(a)
and (b) have been satisfied on and as of the date of the applicable Credit
Extension.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Agents and the Lenders
that:
SECTION 5.01. EXISTENCE, QUALIFICATION AND POWER; COMPLIANCE WITH
LAWS. (a) Each Loan Party and each of its Subsidiaries (i) is a Person duly
organized or formed, validly existing and in good standing under the Laws of the
jurisdiction of its incorporation or organization, (ii) has all requisite power
and authority to (A) own or lease its assets and carry on its business and (B)
execute, deliver and perform its obligations under the Loan Documents to which
it is a party and (iii) is duly qualified and in good standing under the Laws of
each jurisdiction where its ownership, lease or operation of properties or the
conduct of its business requires such qualification except, in the case of
clause (iii), to the extent that failure to do so could not reasonably be
expected to have a Material Adverse Effect.
(b) Each Loan Party and each of its Subsidiaries (i) is in compliance
with all Laws, orders, writs, injunctions and orders and (ii) has all requisite
governmental licenses, authorizations, consents and approvals to operate its
business as currently conducted; except in each case referred to in clause (i)
or (ii) to the extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect.
SECTION 5.02. AUTHORIZATION; NO CONTRAVENTION. The execution, delivery
and performance by each Loan Party of each Loan Document to which such Person is
a party are within such Loan Party's corporate or other powers have been duly
authorized by all necessary corporate or other organizational action, and do not
and will not (a) contravene the terms of any of such Person's Organization
Documents, (b) conflict with or result in any breach or contravention of, or the
creation of any Lien under (other than as permitted by Section 7.01), or require
any payment to be made under (i) any Contractual Obligation to which such Person
is a party or affecting such Person or the properties of such Person or any of
its Subsidiaries or (ii) any order, injunction, writ or decree of any
Governmental Authority or any arbitral award to which such Person or its
property is subject or (c) violate any Law; except with respect to any conflict,
74
breach, contravention or payment (but not creation of Liens) referred to in
clause (b) or (c), to the extent that such conflict, breach, contravention or
payment could not reasonably be expected to have a Material Adverse Effect.
SECTION 5.03. GOVERNMENTAL AUTHORIZATION; OTHER CONSENTS. No approval,
consent, exemption, authorization, or other action by, or notice to, or filing
with, any Governmental Authority or any other Person is necessary or required in
connection with (i) the execution, delivery or performance by, or enforcement
against, any Loan Party of this Agreement or any other Loan Document, (ii) the
grant by any Loan Party of the Liens granted by it pursuant to the Collateral
Documents, (iii) the perfection or maintenance of the Liens created under the
Collateral Documents (including the priority thereof) or (iv) the exercise by
the Administrative Agent or any Lender of its rights under the Loan Documents or
the remedies in respect of the Collateral pursuant to the Collateral Documents,
except for (A) filings necessary to perfect the Liens on the Collateral granted
by the Loan Parties in favor of the Secured Parties, (B) such consents,
approvals, registrations and filings with any Governmental Authority as may be
required in connection with the exercise of rights under the Collateral
Documents following an Event of Default, (C) the approvals, consents,
exemptions, authorizations, actions, notices and filings which have been duly
obtained, taken, given or made and are in full force and effect and (D) those
approvals, consents, exemptions, authorizations or other actions, notices or
filings, the failure of which to obtain or make could not reasonably be expected
to have a Material Adverse Effect.
SECTION 5.04. BINDING EFFECT. This Agreement and each other Loan
Document has been duly executed and delivered by each Loan Party that is party
hereto or thereto. This Agreement and each other Loan Document constitutes, a
legal, valid and binding obligation of such Loan Party, enforceable against each
Loan Party that is party hereto or thereto in accordance with its terms, subject
to Debtor Relief Laws and general principles of equity (whether considered in a
proceeding in equity or law) and an implied covenant of good faith and fair
dealing.
SECTION 5.05. FINANCIAL STATEMENTS; NO MATERIAL ADVERSE EFFECT. (a)
(i) The Audited Financial Statements fairly present in all material respects the
financial condition of the Company and its Subsidiaries as of the dates thereof
and their results of operations for the period covered thereby in accordance
with GAAP consistently applied throughout the periods covered thereby, except as
otherwise expressly noted therein. During the period from December 31, 2005, to
and including the Closing Date, there has been (x) no sale, transfer or other
disposition by the Company or any of its Subsidiaries of any material part of
the business or property of the Company or any of its Subsidiaries, taken as a
whole, and (y) no purchase or other acquisition by the Company or any of its
Subsidiaries of any business or property (including any Equity Interests of any
other Person) material in relation to the consolidated financial condition of
the Company and its Subsidiaries, taken as a whole, in each case, which is not
reflected in the foregoing financial statements or in the notes thereto.
(ii) The unaudited PRO FORMA consolidated balance sheet of the
Borrower and its subsidiaries (determined in accordance with GAAP) as at
December 31,
75
2005 (including the notes thereto) (the "PRO FORMA BALANCE SHEET"), a copy
of which has heretofore been furnished to the Administrative Agent, has
been prepared giving effect (as if such events had occurred on such date)
to the Transaction. The Pro Forma Balance Sheet has been prepared in good
faith, based on assumptions believed by the Borrower to be reasonable as
of the date of delivery thereof, and presents fairly in all material
respects on a PRO FORMA basis the estimated financial position of the
Borrower and the Subsidiaries as at December 31, 2005, assuming that the
events specified in the preceding sentence had actually occurred at such
date.
(b) Since the Closing Date, there has been no event or circumstance,
either individually or in the aggregate, that has had or could reasonably be
expected to have a Material Adverse Effect.
(c) The forecasts of consolidated balance sheets, income statements
and cash flow statements of the Borrower and the Subsidiaries for each fiscal
year ending after the Closing Date until the sixth anniversary of the Closing
Date, copies of which have been furnished to the Administrative Agent prior to
the Closing Date in a form reasonably satisfactory to it, have been prepared in
good faith on the basis of the assumptions stated therein, which assumptions
were believed to be reasonable at the time of preparation of such forecasts, it
being understood that actual results may vary from such forecasts and that such
variations may be material.
SECTION 5.06. LITIGATION. Except as disclosed in "Note L - Commitments
and Contingencies" to the Consolidated Financial Statements set forth in the
Company's Annual report on Form 10-K for the year ended December 31, 2005, there
are no actions, suits, proceedings, claims, investigations or disputes pending
or, to the knowledge of the Borrower, threatened in writing, at law, in equity,
in arbitration or before any Governmental Authority, by or against the Borrower,
any of its Subsidiaries or against any of their respective properties or
revenues that either individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
SECTION 5.07. NO DEFAULT. Neither the Borrower nor any Subsidiary is
in default under or with respect to, or a party to, any Contractual Obligation
that could, either individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.
SECTION 5.08. OWNERSHIP OF PROPERTY; LIENS. Each Loan Party and each
of its Subsidiaries has good record and marketable title in fee simple to, or
valid leasehold interests in, or easements or other limited property interests
in, all real property necessary in the ordinary conduct of its business, free
and clear of all Liens except for minor defects in title that do not materially
interfere with its ability to conduct its business or to utilize such assets for
their intended purposes and Liens permitted by Section 7.01 and except where the
failure to have such title could not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.
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SECTION 5.09. ENVIRONMENTAL COMPLIANCE. Except as would not, either
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect, neither the Borrower nor any of its Subsidiaries (a) is in
violation of Environmental Law or has failed to obtain, maintain or comply with
any Environmental Permit, (b) have become subject to any Environmental
Liability, (c) has received written notice of any claim with respect to any
Environmental Liability or (d) knows of any facts or circumstances reasonably
likely to result in any Environmental Liability affecting the Borrower or any of
its Subsidiaries.
SECTION 5.10. TAXES. Except as set forth in Schedule 5.10 and except
as could not, either individually or in the aggregate, reasonably be expected to
result in a Material Adverse Effect, the Borrower and the Subsidiaries have
filed all Federal and state and other tax returns and reports required to be
filed, and have paid all Federal and state and other Taxes levied or imposed
upon them or their properties, income or assets otherwise due and payable,
except those (a) which are not overdue by more than thirty (30) days or (b)
which are being contested in good faith by appropriate proceedings diligently
conducted and for which adequate reserves have been provided in accordance with
GAAP.
SECTION 5.11. ERISA COMPLIANCE. (a) Except as set forth in Schedule
5.11(a) or as could not, either individually or in the aggregate, reasonably be
expected to result in a Material Adverse Effect, each Plan is in compliance with
the applicable provisions of ERISA, the Code and other Federal or state Laws.
(b) (i) No ERISA Event has occurred during the five year period prior
to the date on which this representation is made or deemed made with respect to
any Pension Plan; (ii) no Pension Plan has an "accumulated funding deficiency"
(as defined in Section 412 of the Code), whether or not waived; (iii) neither
any Loan Party nor any ERISA Affiliate has incurred, or reasonably expects to
incur, any liability under Title IV of ERISA with respect to any Pension Plan
(other than premiums due and not delinquent under Section 4007 of ERISA); (iv)
neither any Loan Party nor any ERISA Affiliate has incurred, or reasonably
expects to incur, any liability (and no event has occurred which, with the
giving of notice under Section 4219 of ERISA, would result in such liability)
under Sections 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and
(v) neither any Loan Party nor any ERISA Affiliate has engaged in a transaction
that could be subject to Sections 4069 or 4212(c) of ERISA, except, with respect
to each of the foregoing clauses of this Section 5.11(b), as could not
reasonably be expected, individually or in the aggregate, to result in a
Material Adverse Effect.
SECTION 5.12. SUBSIDIARIES; EQUITY INTERESTS. As of the Closing Date,
neither Holdings nor any other Loan Party has any Subsidiaries other than those
specifically disclosed in Schedule 5.12, and all of the outstanding Equity
Interests in each of the Subsidiaries have been validly issued, are fully paid
and nonassessable and all Equity Interests owned by Holdings or any other Loan
Party are owned free and clear of all Liens except (i) those created under the
Collateral Documents and (ii) any nonconsensual Lien that is permitted under
Section 7.01. As of the Closing Date, Schedule 5.12 (a) sets forth the name and
jurisdiction of each Subsidiary, (b) sets forth
77
the ownership interest of Holdings, the Borrower and any other Subsidiary in
each Subsidiary, including the percentage of such ownership and (c) identifies
each Subsidiary the Equity Interests of which are required to be pledged on the
Closing Date pursuant to the Collateral and Guarantee Requirement.
SECTION 5.13. MARGIN REGULATIONS; INVESTMENT COMPANY ACT. (a) The
Borrower is not engaged nor will it engage, principally or as one of its
important activities, in the business of purchasing or carrying margin stock
(within the meaning of Regulation U issued by the FRB), or extending credit for
the purpose of purchasing or carrying margin stock, and no proceeds of any
Borrowings or drawings under any Letter of Credit will be used for any purpose
that violates Regulation U.
(b) None of Holdings, the Borrower, or any Subsidiary is or is
required to be registered as an "investment company" under the Investment
Company Act of 1940.
SECTION 5.14. DISCLOSURE. No report, financial statement, certificate
or other written information furnished by or on behalf of any Loan Party to any
Agent or any Lender in connection with the transactions contemplated hereby and
the negotiation of this Agreement or delivered hereunder or under any other Loan
Document (as modified or supplemented by other information so furnished) when
taken as a whole 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 materially misleading; PROVIDED
that, with respect to projected financial information and pro forma financial
information, the Borrower represents only that such information was prepared in
good faith based upon assumptions believed to be reasonable at the time of
preparation; it being understood that such projections may vary from actual
results and that such variances may be material; PROVIDED FURTHER that with
respect to information furnished on behalf of the Borrower or any Subsidiary by
a third party (other than the Investors), this representation is made to the
best of the Borrower's knowledge after due inquiry.
SECTION 5.15. INTELLECTUAL PROPERTY; LICENSES, ETC. Each of the Loan
Parties and their Subsidiaries own, license or possess the right to use, all of
the trademarks, service marks, trade names, domain names, copyrights, patents,
patent rights, licenses, technology, software, know-how database rights, design
rights and other intellectual property rights (collectively, "IP RIGHTS") that
are reasonably necessary for the operation of the businesses of the Loan Parties
and their Subsidiaries, taken as a whole, as currently conducted, and, without
conflict with the rights of any Person, except to the extent any such failure to
own, license or possess the right to use or any such conflicts, either
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect. No IP Rights, advertising, product, process, method,
substance, part or other material used by any Loan Party or any Subsidiary in
the operation of their respective businesses as currently conducted infringes
upon any rights held by any Person except for such infringements, individually
or in the aggregate, which could not reasonably be expected to have a Material
Adverse Effect.
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SECTION 5.16. SOLVENCY. On the Closing Date after giving effect to the
Transaction, the Loan Parties, on a consolidated basis, are Solvent.
SECTION 5.17. SUBORDINATION OF JUNIOR FINANCING. The Obligations are
"Senior Debt", "Senior Indebtedness", "Guarantor Senior Debt" or "Senior Secured
Financing" (or any comparable term) under, and as defined in, any Junior
Financing Documentation.
SECTION 5.18. LABOR MATTERS. Except as, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect: (a) there are no
strikes or other labor disputes against any of Holdings, the Borrower or its
Subsidiaries pending or, to the knowledge of Holdings or the Borrower,
threatened; (b) hours worked by and payment made to employees of each of
Holdings, the Borrower or its Subsidiaries have not been in violation of the
Fair Labor Standards Act or any other applicable Laws dealing with such matters;
and (c) all payments due from any of Holdings, the Borrower or its Subsidiaries
on account of employee health and welfare insurance have been paid or accrued as
a liability on the books of the relevant party.
ARTICLE VI
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder which is accrued and payable shall remain unpaid or
unsatisfied, or any Letter of Credit shall remain outstanding, each of Holdings
and the Borrower shall, and shall (except in the case of the covenants set forth
in Sections 6.01, 6.02 and 6.03) cause each Restricted Subsidiary to:
SECTION 6.01. FINANCIAL STATEMENTS. Deliver to the Administrative
Agent for prompt further distribution to each Lender:
(a) as soon as available, but in any event within ninety (90) days
after the end of each fiscal year of the Borrower beginning with the 2006
fiscal year, a consolidated balance sheet of the Borrower and the
Subsidiaries as at the end of such fiscal year, and the related
consolidated statements of income or operations, stockholders' equity and
cash flows for such fiscal year, setting forth in each case in comparative
form the figures for the previous fiscal year, all in reasonable detail
and prepared in accordance with GAAP, audited and accompanied by a report
and opinion of KPMG LLP or any other independent registered public
accounting firm of nationally recognized standing, which report and opinion
shall be prepared in accordance with generally accepted auditing standards
and shall not be subject to any "going concern" or like qualification or
exception or any qualification or exception as to the scope of such audit
(other than, in the case of matters relating to any acquired business
or assets, in respect of the period prior to the acquisition of such
business or assets);
79
(b) as soon as available, but in any event within forty-five (45) days
after the end of each of the first three (3) fiscal quarters of each fiscal
year of the Borrower beginning with the fiscal quarter ending June 30,
2006, a consolidated balance sheet of the Borrower and the Subsidiaries as
at the end of such fiscal quarter, and the related (i) consolidated
statements of income or operations for such fiscal quarter and for the
portion of the fiscal year then ended and (ii) consolidated statements of
cash flows for the portion of the fiscal year then ended, setting forth in
each case in comparative form the figures for the corresponding fiscal
quarter of the previous fiscal year and the corresponding portion of the
previous fiscal year, all in reasonable detail and certified by a
Responsible Officer of the Borrower as fairly presenting in all material
respects the financial condition, results of operations, stockholders'
equity and cash flows of the Borrower and the Subsidiaries in accordance
with GAAP, subject only to normal year-end adjustments and the absence of
notes;
(c) as soon as available, and in any event no later than ninety (90)
days after the end of each fiscal year of the Borrower, a detailed
consolidated budget for the following fiscal year (including a projected
consolidated balance sheet of the Borrower as of the end of the following
fiscal year, the related consolidated statements of projected cash flow
and projected income and a summary of the material underlying assumptions
applicable thereto) (collectively, the "PROJECTIONS");
(d) simultaneously with the delivery of each set of consolidated
financial statements referred to in Sections 6.01(a) and 6.01(b) above, the
related consolidating financial statements of the Borrower and each of its
Subsidiaries (which shall reflect the adjustments necessary to eliminate
the accounts of Unrestricted Subsidiaries (if any) from such consolidated
financial statements).
Notwithstanding the foregoing, the obligations in paragraphs (a) and (b) of this
Section 6.01 may be satisfied with respect to financial information of the
Borrower and the Restricted Subsidiaries by furnishing (A) the applicable
financial statements of Holdings (or any direct or indirect parent of Holdings)
or (B) the Borrower's or Holdings' (or any direct or indirect parent thereof),
as applicable, Form 10-K or 10-Q, as applicable, filed with the SEC; PROVIDED
that, with respect to each of clauses (A) and (B), (i) to the extent such
information relates to Holdings (or a parent thereof), such information is
accompanied by consolidating information that explains in reasonable detail the
differences between the information relating to Holdings (or such parent), on
the one hand, and the information relating to the Borrower and the Restricted
Subsidiaries on a standalone basis, on the other hand, and (ii) to the extent
such information is in lieu of information required to be provided under Section
6.01(a), the information described in clauses (A) and (B) is accompanied by a
report and opinion of KPMG LLP or any other independent registered public
accounting firm of nationally recognized standing, which report and opinion
shall be prepared in accordance with generally accepted auditing standards and
shall not be subject to any "going concern" or like qualification or
80
exception or any qualification or exception as to the scope of such audit (other
than, in the case of matters relating to any acquired business or assets, in
respect of the period prior to the acquisition of such business or assets).
SECTION 6.02. CERTIFICATES; OTHER INFORMATION. Deliver to the
Administrative Agent for prompt further distribution to each Lender:
(a) no later than five (5) days after the delivery of the financial
statements referred to in Section 6.01(a), a letter or certificate of its
independent registered public accounting firm certifying such financial
statements and stating that in making the examination necessary therefor no
knowledge was obtained of any Event of Default under Section 7.09 or, if any
such Event of Default shall exist, stating the nature and status of such event;
(b) no later than five (5) days after the delivery of the financial
statements referred to in Section 6.01(a) and (b), a duly completed Compliance
Certificate signed by a Responsible Officer of the Borrower and, if such
Compliance Certificate demonstrates an Event of Default of any covenant under
Section 7.09, any of the Equity Investors may deliver, together with such
Compliance Certificate, notice of their intent to cure (a "NOTICE OF INTENT TO
CURE") such Event of Default pursuant to Section 8.04; PROVIDED that the
delivery of a Notice of Intent to Cure shall in no way affect or alter the
occurrence, existence or continuation of any such Event of Default or the
rights, benefits, powers and remedies of the Administrative Agent and the
Lenders under any Loan Document;
(c) promptly after the same are publicly available, copies of all
annual, regular, periodic and special reports and registration statements which
Holdings or the Borrower files with the SEC or with any Governmental Authority
that may be substituted therefor (other than amendments to any registration
statement (to the extent such registration statement, in the form it became
effective, is delivered), exhibits to any registration statement and, if
applicable, any registration statement on Form S-8) and in any case not
otherwise required to be delivered to the Administrative Agent pursuant hereto;
(d) promptly after the furnishing thereof, copies of any material
requests or material notices received by any Loan Party (other than in the
ordinary course of business) or material statements or material reports
furnished to any holder of debt securities of any Loan Party or of any of its
Subsidiaries pursuant to the terms of any Junior Financing Documentation in a
principal amount greater than the Threshold Amount and not otherwise required to
be furnished to the Lenders pursuant to any other clause of this Section 6.02;
(e) together with the delivery of each Compliance Certificate pursuant
to Section 6.02(b) with respect to the financial statements delivered pursuant
to Section 6.01(a), (i) a report setting forth the information required by
Section 2.03(k) of the Pledge Agreement or confirming that there has been no
change in such information since the Closing Date or the date of the last such
report; PROVIDED, HOWEVER, that the
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Borrower shall notify the Administrative Agent, promptly after obtaining
knowledge thereof, of any change in the information required by 2.03(k) of the
Pledge Agreement, (ii) a calculation of Excess Cash Flow for the fiscal year to
which such financial statements related and the amount of Term Loans, if any,
required to be prepaid pursuant to Section 2.05(b) and (iii) a list of each
Subsidiary that identifies each Subsidiary as a Restricted Subsidiary or an
Unrestricted Subsidiary as of the date of delivery of such Compliance
Certificate;
(f) promptly following the reasonable request of the Administrative
Agent or the Required Lenders, a report prepared by an independent actuarial
consulting firm of recognized professional standing reasonably satisfactory to
the Administrative Agent and the Required Lenders reviewing the adequacy of
reserves of each Insurance Subsidiary determined in accordance with SAP, which
firm shall be provided access to or copies of all reserve analysis and
valuations relating to the Borrower or its Subsidiaries; PROVIDED that no
request may be made pursuant to this clause (f) unless there shall have occurred
and be continuing an Event of Default;
(g) promptly (i) after receipt thereof, copies of (A) all triennial
examinations and (B) any reports reviewing the adequacy of reserves, in each
case delivered to such Person by any Applicable Insurance Regulatory Authority,
insurance commission or similar regulatory authority, (ii) after receipt
thereof, written notice of any assertion by any Applicable Insurance Regulatory
Authority or any Governmental Agency or agencies substituted therefor, as to a
violation of any applicable Law by any Insurance Subsidiary, which could be
reasonably expected to have a Material Adverse Effect, (iii) after receipt
thereof, a copy of any notice of termination, cancelation or recapture of any
Reinsurance Agreement or Retrocession Agreement to which an Insurance Subsidiary
is a party to the extent such termination or cancelation could reasonably be
expected to have a Material Adverse Effect and (iv) after receipt thereof,
copies of any notice of actual suspension, termination or revocation of any
material license of any Insurance Subsidiary by any Applicable Insurance
Regulatory Authority, including any request by an Applicable Insurance
Regulatory Authority that commits an Insurance Subsidiary to take or refrain
from taking any action or which otherwise affects the authority of such
Insurance Subsidiary to conduct its business; and
(h) promptly, such additional information regarding the business,
legal, financial or corporate affairs of any Loan Party or any Subsidiary, or
compliance with the terms of the Loan Documents, as the Administrative Agent or
any Lender through the Administrative Agent may from time to time reasonably
request.
Documents required to be delivered pursuant to Section 6.01(a) or (b)
or Section 6.02(c) (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (i) on which the
Borrower posts such documents, or provides a link thereto on the Borrower's
website on the Internet at ▇▇▇▇://▇▇▇.▇▇▇▇.▇▇▇; or (ii) on which such documents
are posted on the Borrower's behalf on IntraLinks/IntraAgency or another
relevant website, if any, to which each Lender and the Administrative Agent have
access (whether a commercial, third-party website or whether
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sponsored by the Administrative Agent); PROVIDED that: (i) upon written request
by the Administrative Agent, the Borrower shall deliver paper copies of such
documents to the Administrative Agent for further distribution to each Lender
until a written request to cease delivering paper copies is given by the
Administrative Agent and (ii) the Borrower shall notify (which may be by
facsimile or electronic mail) the Administrative Agent of the posting of any
such documents and provide to the Administrative Agent by electronic mail
electronic versions (I.E., soft copies) of such documents. Notwithstanding
anything contained herein, in every instance the Borrower shall be required to
provide paper copies of the Compliance Certificates required by Section 6.02(b)
to the Administrative Agent. Each Lender shall be solely responsible for timely
accessing posted documents or requesting delivery of paper copies of such
documents from the Administrative Agent and maintaining its copies of such
documents.
SECTION 6.03. NOTICES. Promptly after obtaining knowledge thereof,
notify the Administrative Agent:
(a) of the occurrence of any Default;
(b) of any matter that has resulted or could reasonably be expected to
result in a Material Adverse Effect, including arising out of or resulting
from (i) breach or non-performance of, or any default or event of default
under, a Contractual Obligation of any Loan Party or any Subsidiary, (ii)
any dispute, litigation, investigation, proceeding or suspension between
any Loan Party, or any Subsidiary and any Governmental Authority, (iii) the
commencement of, or any material development in, any litigation or
proceeding affecting any Loan Party or any Subsidiary, including pursuant
to any applicable Environmental Laws or the assertion or occurrence of any
noncompliance by any Loan Party or as any of its Subsidiaries with, or
liability under, any Environmental Law or Environmental Permit, (iv) the
occurrence of any ERISA Event that, together with all other ERISA Events
that have developed or occurred, could reasonably be expected to have a
Material Adverse Effect, or (v) the adoption of any Law, or any change in
Law (including in any administration or interpretation thereof by any
Governmental Authority); and
(c) of the occurrence of any change in the Applicable Credit Rating.
Each notice pursuant to this Section shall be accompanied by a written
statement of a Responsible Officer of the Borrower (x) that such notice is being
delivered pursuant to Section 6.03(a), (b) or (c) (as applicable) and (y)
setting forth details of the occurrence referred to therein and stating what
action the Borrower has taken and proposes to take with respect thereto.
SECTION 6.04. PAYMENT OF OBLIGATIONS. Pay, discharge or otherwise
satisfy as the same shall become due and payable, all its obligations and
liabilities in respect of taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits or in respect of its property,
except, in each case, to the extent the
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failure to pay or discharge the same could not reasonably be expected to have a
Material Adverse Effect.
SECTION 6.05. PRESERVATION OF EXISTENCE, ETC. (a) Preserve, renew and
maintain in full force and effect its legal existence under the Laws of the
jurisdiction of its organization except in a transaction permitted by Section
7.04 or 7.05 and (b) take all reasonable action to maintain all rights,
privileges (including its good standing), permits, licenses and franchises
necessary or desirable in the normal conduct of its business, except (i) to the
extent that failure to do so could not reasonably be expected to have a Material
Adverse Effect or (ii) pursuant to a transaction permitted by Section 7.04 or
7.05.
SECTION 6.06. MAINTENANCE OF PROPERTIES. Except if the failure to do
so could not reasonably be expected to have a Material Adverse Effect, (a)
maintain, preserve and protect all of its material properties and equipment
necessary in the operation of its business in good working order, repair and
condition, ordinary wear and tear excepted and casualty or condemnation
excepted, and (b) make all necessary renewals, replacements, modifications,
improvements, upgrades, extensions and additions thereof or thereto in
accordance with prudent industry practice.
SECTION 6.07. MAINTENANCE OF INSURANCE. (a) Maintain insurance with
responsible and reputable insurance companies or associations in such amounts
and covering such risks as is usually carried by companies engaged in similar
businesses and owning similar properties in the same general areas in which the
Borrower or such Subsidiary operates.
(b) Cause any Insurance Subsidiary to conduct its insurance business
in compliance with all applicable insurance laws, rules, regulations and orders
and using sound actuarial principles except if the failure to comply could not
reasonably be expected to have a Material Adverse Effect. The Borrower will
provide the Administrative Agent (A) copies of any outside actuarial reports, if
any, prepared with respect to any projection, valuation or appraisal of any
Insurance Subsidiary (in form and substance and scope consistent with past
practices and including with respect to the Borrower) promptly after receipt
thereof and (B) promptly after receipt thereof, an actuarial opinion, if any,
with respect to any Insurance Subsidiary (in form and substance and scope
consistent with past practices and including with respect to the Borrower) from
an actuarial firm reasonably satisfactory to the Administrative Agent.
SECTION 6.08. COMPLIANCE WITH LAWS. Comply with the requirements of
all Laws and all orders, writs, injunctions and decrees applicable to it or to
its business or property, except if the failure to comply therewith could not
reasonably be expected to have a Material Adverse Effect.
SECTION 6.09. BOOKS AND RECORDS. Maintain proper books of record and
account, in which entries that are full, true and correct in all material
respects and are in conformity with GAAP consistently applied shall be made of
all material financial
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transactions and matters involving the assets and business of the Borrower or
such Subsidiary, as the case may be.
SECTION 6.10. INSPECTION RIGHTS. Subject to applicable Law and
confidentiality agreements entered into by the Borrower or any Subsidiary in the
ordinary course of business, permit representatives and independent contractors
of the Administrative Agent and each Lender to visit and inspect any of its
properties, to examine its corporate, financial and operating records, and make
copies thereof or abstracts therefrom, and to discuss its affairs, finances and
accounts with its directors, officers, and independent public accountants, all
at the reasonable expense of the Borrower and at such reasonable times during
normal business hours and as often as may be reasonably desired, upon reasonable
advance notice to the Borrower; PROVIDED that, excluding any such visits and
inspections during the continuation of an Event of Default, only the
Administrative Agent on behalf of the Lenders may exercise rights of the
Administrative Agent and the Lenders under this Section 6.10 and the
Administrative Agent shall not exercise such rights more often than two (2)
times during any calendar year absent the existence of an Event of Default and
only one (1) such time shall be at the Borrower's expense; PROVIDED FURTHER that
when an Event of Default exists, the Administrative Agent or any Lender (or any
of their respective representatives or independent contractors) may do any of
the foregoing at the expense of the Borrower at any time during normal business
hours and upon reasonable advance notice. The Administrative Agent and the
Lenders shall give the Borrower the opportunity to participate in any
discussions with the Borrower's independent public accountants.
SECTION 6.11. COVENANT TO GUARANTEE OBLIGATIONS AND GIVE SECURITY. At
the Borrower's expense, take all action necessary or reasonably requested by the
Administrative Agent to ensure that the Collateral and Guarantee Requirement
continues to be satisfied, including upon the formation or acquisition of any
new direct or indirect wholly owned Domestic Subsidiary (other than an
Unrestricted Subsidiary or an Excluded Subsidiary) by any Loan Party or the
designation in accordance with Section 6.14 of any existing direct or indirect
wholly owned Domestic Subsidiary as a Restricted Subsidiary:
(a) within thirty (30) days after such formation, acquisition or
designation or such longer period as the Administrative Agent may agree in its
discretion:
(i) cause (A) each such Restricted Subsidiary that is required to
become a Guarantor pursuant to the Collateral and Guarantee Requirement to
duly execute and deliver to the Administrative Agent or the Collateral
Agent (as appropriate) Pledge Agreement Supplements and other security
agreements and documents, as reasonably requested by and in form and
substance reasonably satisfactory to the Administrative Agent (consistent
with the Pledge Agreement and other security agreements in effect on the
Closing Date), in each case granting Liens required by the Collateral and
Guarantee Requirement and (B) each direct or indirect parent of each such
Restricted Subsidiary that is required to be a Guarantor pursuant to the
Collateral and Guarantee Requirement to duly execute and deliver to the
Administrative Agent such Pledge Agreement Supplements and other security
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agreements as reasonably requested by and in form and substance reasonably
satisfactory to the Administrative Agent (consistent with the Pledge
Agreements in effect on the Closing Date), in each case granting Liens
required by the Collateral and Guarantee Requirement;
(ii) (A) cause each such Restricted Subsidiary that is required to
become a Guarantor pursuant to the Collateral and Guarantee Requirement to
deliver any and all certificates representing Equity Interests (to the
extent certificated) that are required to be pledged pursuant to the
Collateral and Guarantee Requirement, accompanied by undated stock powers
or other appropriate instruments of transfer executed in blank, and (B)
cause each direct or indirect parent of such Restricted Subsidiary that is
required to be a Guarantor pursuant to the Collateral and Guarantee
Requirement to deliver any and all certificates representing the
outstanding Equity Interests (to the extent certificated) of such
Restricted Subsidiary that are required to be pledged pursuant to the
Collateral and Guarantee Requirement, accompanied by undated stock powers
or other appropriate instruments of transfer executed in blank; and
(iii) take and cause such Restricted Subsidiary that is required to
become a Guarantor pursuant to the Collateral and Guarantee Requirement and
each direct or indirect parent of such Restricted Subsidiary to take
whatever action (including the filing of Uniform Commercial Code financing
statements and delivery of stock and membership interest certificates) may
be necessary in the reasonable opinion of the Administrative Agent to vest
in the Administrative Agent (or in any representative of the Administrative
Agent designated by it) valid Liens required by the Collateral and
Guarantee Requirement, enforceable against all third parties in accordance
with their terms, subject to Debtor Relief Laws and general principles of
equity (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing; and
(b) within thirty (30) days after the request therefor by the
Administrative Agent, deliver to the Administrative Agent a signed copy of an
opinion, addressed to the Administrative Agent and the other Secured Parties, of
counsel for the Loan Parties reasonably acceptable to the Administrative Agent
as to such matters set forth in this Section 6.11(a) as the Administrative Agent
may reasonably request.
SECTION 6.12. COMPLIANCE WITH ENVIRONMENTAL LAWS. Except, in each
case, to the extent that the failure to do so could not reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect, (a)
comply, and take all reasonable actions to cause all lessees and other Persons
operating or occupying its properties to comply, with all applicable
Environmental Laws and Environmental Permits; (b) obtain and renew all
Environmental Permits necessary for its operations and properties; and (c) in
each case to the extent required by Environmental Laws, conduct any
investigation, study, sampling and testing, and undertake any cleanup, removal,
remedial or other action necessary to remove and clean up all Hazardous
Materials from any of its properties, in accordance with the requirements of all
Environmental Laws.
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SECTION 6.13. FURTHER ASSURANCES AND POST-CLOSING CONDITIONS. Promptly
upon reasonable request by the Administrative Agent (a) correct any material
defect or error that may be discovered in the execution, acknowledgment, filing
or recordation of any Collateral Document or other document or instrument
relating to any Collateral, and (b) do, execute, acknowledge, deliver, record,
re-record, file, re-file, register and re-register any and all such further
acts, deeds, certificates, assurances and other instruments as the
Administrative Agent may reasonably request from time to time in order to carry
out more effectively the purposes of the Collateral Documents.
SECTION 6.14. DESIGNATION OF SUBSIDIARIES. The board of directors of
Holdings may at any time designate any Restricted Subsidiary as an Unrestricted
Subsidiary or any Unrestricted Subsidiary as a Restricted Subsidiary; PROVIDED
that (i) immediately before and after such designation, no Default shall have
occurred and be continuing, (ii) immediately after giving effect to such
designation, the Borrower and the Restricted Subsidiaries shall be in
compliance, on a Pro Forma Basis, with all of the covenants set forth in Section
7.09 (and, as a condition precedent to the effectiveness of any such
designation, the Borrower shall deliver to the Administrative Agent a
certificate setting forth in reasonable detail the calculations demonstrating
such compliance), (iii) no Subsidiary may be designated as an Unrestricted
Subsidiary if it is a "Restricted Subsidiary" for the purpose of any Junior
Financing, as applicable, and (iv) no Restricted Subsidiary may be designated as
an Unrestricted Subsidiary if it was previously designated an Unrestricted
Subsidiary. The designation of any Subsidiary as an Unrestricted Subsidiary
shall constitute an Investment by the Borrower therein at the date of
designation in an amount equal to the net book value of the Borrower's (as
applicable) investment therein. The designation of any Unrestricted Subsidiary
as a Restricted Subsidiary shall constitute the incurrence at the time of
designation of any Indebtedness or Liens of such Subsidiary existing at such
time.
SECTION 6.15. COLLATERAL RELEASE. Immediately upon the commencement of
any Collateral Release Period, the security interests of the Collateral Agent
and the other Secured Parties in the Collateral shall be terminated and
released; PROVIDED that the Guarantee of each Loan Party of the Obligations
pursuant to the Loan Documents shall remain in effect during any such Collateral
Release Period. During any Collateral Release Period, the Administrative Agent
and the Collateral Agent shall execute and deliver, at the Borrower's expense,
all documents or other instruments that the Borrower shall reasonably request to
evidence the termination and release of such security interests and shall return
all Collateral in their possession to the Borrower. During any Collateral
Release Period, Holdings and the Borrower shall not be required to comply with
the terms of Sections 6.11 or 6.13, in each case to the extent such terms
require the creation and perfection of security interests or Liens on Collateral
(it being understood that Holdings and the Borrower shall continue to be
required to comply with the terms of Section 6.11 that require the provision of
Guarantees by Loan Parties in respect of the Obligations).
Upon the termination of any Collateral Release Period, the security
interests of the Collateral Agent and the Secured Parties in the Collateral
shall, without any further action on the part of the Administrative Agent, the
Collateral Agent, the
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Secured Parties or any Loan Party, be reinstated and the provisions of the
immediately preceding paragraph shall no longer apply (until the commencement of
a subsequent Collateral Release Period). Promptly following the termination of
any Collateral Release Period, the Loan Parties shall execute any and all
documents, financing statements, agreements and instruments, and take all such
actions (including the filing and recording of financing statements and other
documents) that may be required under applicable law or that the Administrative
Agent or Collateral Agent shall reasonably request, to reinstate such security
interests and to cause the Collateral and Guarantee Requirement to be satisfied
(all at the expense of the Loan Parties), including with respect to any
Subsidiaries or assets that would have been subjected to the Collateral and
Guarantee Requirement under Section 6.11 had such terminated Collateral Release
Period not been in effect; PROVIDED that all such actions shall be completed no
later than 30 days after the date of termination of such Collateral Release
Period (or such later date as the Collateral Agent shall deem appropriate).
SECTION 6.16. RATING OF FACILITIES. The Borrower shall use
commercially reasonable efforts to cause an A.M. Best Financial Strength rating
with respect to each of the Insurance Subsidiaries that is a Domestic Subsidiary
to be available at all times following the Closing Date until the last Maturity
Date under this Agreement.
SECTION 6.17. USE OF PROCEEDS. Use the proceeds of (a) the Term Loans
made on the Closing Date, together with the Equity Contribution, to pay the
Merger Consideration and Transaction Expenses, (b) any Revolving Credit Loans
for working capital and other general corporate purposes of the Borrower and the
Subsidiaries, and (c) any Incremental Term Loans as specified in the applicable
Incremental Amendment.
ARTICLE VII
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan
or other Obligation hereunder which is accrued and payable shall remain unpaid
or unsatisfied, or any Letter of Credit shall remain outstanding, the Borrower
will not, and will not permit any of its Restricted Subsidiaries to, directly or
indirectly:
SECTION 7.01. LIENS. Create, incur, assume or suffer to exist any
Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, other than the following:
(a) Liens pursuant to any Loan Document;
(b) Liens existing on the date hereof and listed on Schedule 7.01(b)
and any modifications, replacements, renewals or extensions thereof; PROVIDED
that (i) the Lien does not extend to any additional property other than (A)
after-acquired property that is affixed or incorporated into the property
covered by such Lien, and (B) proceeds
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and products thereof, and (ii) the renewal, extension or refinancing of the
obligations secured or benefited by such Liens is permitted by Section 7.03;
(c) Liens for taxes, assessments or governmental charges which are not
overdue for a period of more than ninety (90) days or which are being contested
in good faith and by appropriate proceedings diligently conducted, if adequate
reserves with respect thereto are maintained on the books of the applicable
Person in accordance with GAAP;
(d) statutory Liens of landlords, carriers, warehousemen, mechanics,
materialmen, repairmen, construction contractors or other like Liens arising in
the ordinary course of business which secure amounts not overdue for a period of
more than sixty (60) days or if more than sixty (60) days overdue, are unfiled
and no other action has been taken to enforce such Lien or which are being
contested in good faith and by appropriate proceedings diligently conducted, if
adequate reserves with respect thereto are maintained on the books of the
applicable Person in accordance with GAAP;
(e) pledges or deposits (i) in the ordinary course of business in
connection with workers' compensation, unemployment insurance and other social
security legislation, (ii) in the ordinary course of business securing liability
for reimbursement or indemnification obligations of (including obligations in
respect of letters of credit or bank guarantees for the benefit of) insurance
carriers providing property, casualty or liability insurance to Holdings, the
Borrower or any Restricted Subsidiary, (iii) in the ordinary course of business
to satisfy escrow obligations under reinsurance agreements and (iv) to satisfy
statutory obligations imposed by Applicable Insurance Regulatory Authorities;
(f) deposits to secure the performance of bids, trade contracts,
governmental contracts and leases (other than Indebtedness for borrowed money),
statutory obligations, surety, stay, customs and appeal bonds, performance bonds
and other obligations of a like nature (including those to secure health, safety
and environmental obligations) incurred in the ordinary course of business;
(g) easements, rights-of-way, restrictions, encroachments, protrusions
and other similar encumbrances and minor title defects affecting real property
which, in the aggregate, do not in any case materially interfere with the
ordinary conduct of the business of the Borrower or any material Subsidiary;
(h) Liens securing judgments for the payment of money not constituting
an Event of Default under Section 8.01(h);
(i) Liens securing (A) Indebtedness of the Borrower incurred to
acquire, repair, construct or improve fixed or capital assets of the Borrower
and any refinancing thereof, or (B) Indebtedness permitted under Section
7.03(e); PROVIDED that, in each case (i) such Liens attach concurrently with or
within two hundred and seventy (270) days after the acquisition, repair,
replacement, construction or improvement (as applicable) of the property subject
to such Liens, (ii) such Liens do not at any time encumber any property (except
for accessions to such property) other than the property whose
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acquisition, repair, replacement, construction or improvement was financed by
such Indebtedness and the proceeds and the products thereof and (iii) with
respect to Capitalized Leases, such Liens do not at any time extend to or cover
any assets (except for accessions to such assets) other than the assets subject
to such Capitalized Leases; PROVIDED that individual financings of equipment
provided by one lender may be cross collateralized to other financings of other
equipment provided by such lender;
(j) leases, licenses, subleases or sublicenses granted to others in
the ordinary course of business which do not (i) interfere in any material
respect with the business of the Borrower or any material Subsidiary or (ii)
secure any Indebtedness;
(k) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods in the ordinary course of business;
(l) Liens (i) of a collection bank arising under Section 4-210 of the
Uniform Commercial Code on items in the course of collection and (ii) in favor
of a banking institution arising as a matter of law encumbering deposits
(including the right of set-off) and which are within the general parameters
customary in the banking industry;
(m) Liens (i) on cash advances in favor of the seller of any property
to be acquired in an Investment permitted pursuant to Section 7.02(g), (i) or
(n) to be applied against the purchase price for such Investment, or (ii)
consisting of an agreement to Dispose of any property in a Disposition permitted
under Section 7.05, in each case, solely to the extent such Investment or
Disposition, as the case may be, would have been permitted on the date of the
creation of such Lien;
(n) Liens in favor of the Borrower or a Restricted Subsidiary securing
Indebtedness permitted under Section 7.03(d);
(o) Liens existing on property at the time of its acquisition or
existing on the property of any Person at the time such Person becomes a
Restricted Subsidiary (other than by designation as a Restricted Subsidiary
pursuant to Section 6.14), in each case after the date hereof (other than Liens
on the Equity Interests of any Person that becomes a Restricted Subsidiary) and
the replacement, extension or renewal of any Lien permitted by this clause (o)
upon or in the same property previously subject thereto in connection with a
Permitted Refinancing of the Indebtedness secured thereby; PROVIDED that (i)
such Lien was not created in contemplation of such acquisition or such Person
becoming a Restricted Subsidiary, (ii) such Lien does not extend to or cover any
other assets or property (other than the proceeds or products thereof and other
than after-acquired property subjected to a Lien securing Indebtedness and other
obligations incurred prior to such time and which Indebtedness and other
obligations are permitted hereunder that require, pursuant to their terms at
such time, a pledge of after-acquired property, it being understood that such
requirement shall not be permitted to apply to any property to which such
requirement would not have applied but for such acquisition), and (iii) any
Indebtedness secured thereby is permitted under Section 7.03(e), (f) or (i);
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(p) any interest or title of a lessor under leases entered into by the
Borrower or any of the Restricted Subsidiaries in the ordinary course of
business;
(q) Liens arising out of conditional sale, title retention,
consignment or similar arrangements for sale of goods entered into by the
Borrower or any of the Restricted Subsidiaries in the ordinary course of
business permitted by this Agreement;
(r) Liens deemed to exist in connection with Investments in repurchase
agreements under Section 7.02;
(s) Liens encumbering reasonable customary initial deposits and margin
deposits and similar Liens attaching to brokerage accounts and other securities
accounts incurred in the ordinary course of business and not for speculative
purposes;
(t) Liens that are contractual rights of set-off relating to the
establishment of depository relations with banks not given in connection with
the issuance of Indebtedness;
(u) Liens solely on any ▇▇▇▇ ▇▇▇▇▇▇▇ money deposits made by the
Borrower or any of the Restricted Subsidiaries in connection with any letter of
intent or purchase agreement permitted hereunder;
(v) ground leases in respect of real property on which facilities
owned or leased by the Borrower or any of its Subsidiaries are located;
(w) Liens arising from precautionary Uniform Commercial Code financing
statements regarding operating leases not constituting Indebtedness or
consignments;
(x) Liens on insurance policies and the proceeds thereof securing the
financing by any Loan Party of the premiums with respect thereto permitted under
Section 7.03(n);
(y) other Liens securing Indebtedness of the Borrower or the
Restricted Subsidiaries that, when aggregated with the Indebtedness of the
Restricted Subsidiaries permitted under Section 7.03(m) and the aggregate sale
price of the assets sold in sale and leaseback transactions permitted under
Section 7.05(f), do not exceed 7.5% of Consolidated Total Assets at any time;
and
(z) Liens on student loans securing Indebtedness permitted under
Section 7.03(r).
SECTION 7.02. INVESTMENTS. Make or hold any Investments, except:
(a) Investments in assets that were Cash Equivalents when such
Investment was made;
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(b) loans or advances to officers, directors, independent agents and
consultants, employees of Holdings, the Borrower and the Restricted Subsidiaries
(i) for reasonable and customary business-related travel, entertainment,
relocation and analogous ordinary business purposes, (ii) in connection with
such Person's purchase of Equity Interests of Holdings (or the Borrower after a
Qualifying IPO of the Borrower, or any direct or indirect parent of Holdings)
(PROVIDED that the amount, if any, of cash advanced pursuant to such loans and
paid in connection with the sale of such Equity Interests shall be contributed
to the Borrower in cash as common equity), (iii) loans or advances to
independent agents in the ordinary course of business, and (iv) for purposes not
described in the foregoing clauses (i), (ii) and (iii), in an aggregate
principal amount outstanding not to exceed $5,000,000;
(c) Investments by the Borrower or any Restricted Subsidiary in the
Borrower or in any Restricted Subsidiary;
(d) Investments consisting of extensions of credit in the nature of
accounts receivable or notes receivable arising from the grant of trade credit
in the ordinary course of business, and Investments received in satisfaction or
partial satisfaction thereof from financially troubled account debtors and other
credits to suppliers in the ordinary course of business;
(e) Investments consisting of Liens, Indebtedness, fundamental
changes, Dispositions and Restricted Payments permitted under Sections 7.01,
7.03, 7.04, 7.05 and 7.06, respectively;
(f) other Investments (i) existing or contemplated on the date hereof
and set forth on Schedule 7.02(f) and any modification, replacement, renewal,
reinvestment or extension thereof and (ii) Investments existing on the date
hereof by the Borrower or any Restricted Subsidiary in the Borrower or any other
Restricted Subsidiary and any modification, renewal or extension thereof;
(g) Investments in Swap Contracts permitted under Section 7.03;
(h) promissory notes and other noncash consideration received in
connection with Dispositions permitted by Section 7.05;
(i) any other Investment; PROVIDED that, with respect to each
Investment made pursuant to this Section 7.02(i) (each, a "PERMITTED
INVESTMENT"):
(A) if such Investment results in a newly created or acquired
Subsidiary (and, to the extent required under the Collateral and
Guarantee Requirement, the Subsidiaries of such created or acquired
Subsidiary) then, to the extent applicable, such Subsidiary shall
comply with the requirements of Section 6.11, within the times
specified therein;
(B) if such Investment is a Permitted Acquisition, the acquired
property, assets, business or Person is in substantially the same or a
substantially similar line of business as the Borrower or a
Subsidiary;
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(C) (1) immediately before and immediately after giving Pro Forma
Effect to any such Investment, no Default shall have occurred and be
continuing and (2) immediately after giving effect to such Investment,
the Borrower and the Restricted Subsidiaries shall be in Pro Forma
Compliance with the covenants set forth in Section 7.09, such
compliance to be determined on the basis of the financial information
most recently delivered to the Administrative Agent and the Lenders
pursuant to Section 6.01(a) or (b) (or, prior to any such delivery,
referred to in Section 5.05) as though such Investment had been
consummated as of the first day of the fiscal period covered thereby
and evidenced by a certificate from the Chief Financial Officer of the
Borrower demonstrating such compliance calculation in reasonable
detail; PROVIDED that the Borrower shall not be required to deliver
such certificate for any individual Investment the aggregate amount of
consideration for which is less than $10,000,000; and
(D) solely in the case of Investments the aggregate amount of
consideration for which is in excess of $10,000,000, the Borrower
shall have delivered to the Administrative Agent, on behalf of the
Lenders, no later than five (5) Business Days after the date on which
any such Investment is consummated, a certificate of a Responsible
Officer, in form and substance reasonably satisfactory to the
Administrative Agent, certifying that all of the requirements set
forth in this clause (i) have been satisfied or will be satisfied on
or prior to the consummation of such Investment;
(j) the Transaction;
(k) Investments (including debt obligations and Equity Interests)
received in connection with the bankruptcy or reorganization of suppliers and
customers or in settlement of delinquent obligations of, or other disputes with,
customers and suppliers arising in the ordinary course of business or upon the
foreclosure with respect to any secured Investment or other transfer of title
with respect to any secured Investment;
(l) loans and advances to Holdings or any direct or indirect parent of
Holdings in lieu of, and not in excess of the amount of (after giving effect to
any other loans, advances or Restricted Payments in respect thereof), Restricted
Payments to the extent permitted to be made to Holdings (or such parent) in
accordance with Sections 7.06(g) or (i);
(m) advances of payroll payments to consultants, employees and
payments to independent agents in the ordinary course of business;
(n) Investments to the extent that payment for such Investments is
made solely with (or with the proceeds of the issuance of) capital stock of
Holdings or any direct or indirect parent of Holdings (or the Borrower after a
Qualifying IPO of the Borrower);
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(o) Investments of a Restricted Subsidiary acquired after the Closing
Date or of a corporation merged into the Borrower or merged or consolidated with
a Restricted Subsidiary in accordance with Section 7.04 after the Closing Date
to the extent that such Investments were not made in contemplation of or in
connection with such acquisition, merger or consolidation and were in existence
on the date of such acquisition, merger or consolidation;
(p) Guarantees by Holdings, the Borrower or any Restricted Subsidiary
of leases (other than Capitalized Leases) or of other obligations that do not
constitute Indebtedness, in each case entered into in the ordinary course of
business;
(q) Investments made in connection with the funding of contributions
under any non-qualified retirement plan or similar employee compensation plan in
an amount not to exceed the amount of compensation expense recognized by the
Borrower and the Subsidiaries in connection with such plans;
(r) Investments made in the ordinary course of business in connection
with the making of student loans; and
(s) Investments by an Insurance Subsidiary in the ordinary course of
business and permitted by applicable Law, including insurance policy loans made
to insureds.
Notwithstanding anything to the contrary herein, the Borrower will not, and will
not permit any of its Restricted Subsidiaries to, directly or indirectly, make
or hold any Investments in an Unrestricted Subsidiary that, together with all
Investments of the Borrower and the Restricted Subsidiaries in Unrestricted
Subsidiaries at such time, is in excess of 5.0% of Consolidated Total Assets at
such time other than any Qualified Equity Interests in an Unrestricted
Subsidiary (i) designated as such pursuant to Section 6.14 solely to effect a
Disposition permitted under Section 7.05(l) and (ii) the assets of which shall
be comprised of the assets permitted to be transferred pursuant to such
Disposition or a note that has been received in connection with such Disposition
that evidences the obligations of the purchaser of such assets to pay cash
consideration, PROVIDED that, immediately after such designation, the Total
Leverage Ratio shall be less than or equal to the Total Leverage Ratio as of the
Closing Date after giving effect to the Transactions.
SECTION 7.03. INDEBTEDNESS. Permit any Restricted Subsidiary of the
Borrower to, directly or indirectly, create, incur, assume or suffer to exist
any Indebtedness, except:
(a) Indebtedness under the Loan Documents;
(b) other Indebtedness (i) outstanding on the date hereof and
listed on Schedule 7.03(b) and any Permitted Refinancing thereof and
(ii) intercompany Indebtedness outstanding on the date hereof;
(c) Guarantees by any Loan Party in respect of Indebtedness of
the Borrower or any Restricted Subsidiary otherwise permitted
hereunder;
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PROVIDED that (A) no Guarantee by any Restricted Subsidiary of any
Junior Financing shall be permitted unless such Restricted Subsidiary
shall have also provided a Guarantee of the Obligations substantially
on the terms set forth in the Guaranty and (B) if the Indebtedness
being Guaranteed is subordinated to the Obligations, such Guarantee
shall be subordinated to the Guarantee of the Obligations on terms at
least as favorable to the Lenders as those contained in the
subordination of such Indebtedness;
(d) Indebtedness of any Restricted Subsidiary owing to the
Borrower or any other Restricted Subsidiary to the extent constituting
an Investment permitted by Section 7.02; PROVIDED that all such
Indebtedness of any Loan Party owed to any Person that is not a Loan
Party shall be subject to the subordination terms set forth in Exhibit
H;
(e) (i) Attributable Indebtedness and other Indebtedness
(including Capitalized Leases) financing the acquisition,
construction, repair, replacement or improvement of fixed or capital
assets; PROVIDED that such Indebtedness is incurred concurrently with
or within two hundred and seventy (270) days after the applicable
acquisition, construction, repair, replacement or improvement, (ii)
Attributable Indebtedness arising out of sale and leaseback
transactions permitted by Section 7.05(f) and (iii) any Permitted
Refinancing of any Indebtedness set forth in the immediately preceding
clauses (i) and (ii);
(f) Indebtedness assumed in connection with any Permitted
Acquisition together with any Permitted Refinancing thereof; PROVIDED
that (i) such Indebtedness is not incurred in contemplation of such
Permitted Acquisition and (ii) both immediately prior to and after
giving effect to the assumption of such Indebtedness and the
incurrence of all Indebtedness resulting from any Permitted
Refinancing thereof, (A) no Default shall have occurred and be
continuing and (B) the Borrower and the Restricted Subsidiaries shall
be in Pro Forma Compliance with the covenants set forth in Section
7.09;
(g) Indebtedness in respect of Swap Contracts designed to hedge
against interest rates or foreign exchange rates incurred in the
ordinary course of business and not for speculative purposes;
(h) Indebtedness representing deferred compensation to
consultants, employees or independent agents of the Restricted
Subsidiaries incurred in the ordinary course of business;
(i) Indebtedness of any Loan Party to current or former officers,
directors, independent agents, consultants and employees, their
respective estates, spouses or former spouses to finance the purchase
or redemption of Equity Interests of Holdings or any parent of
Holdings (or, after a Qualified
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IPO, the Borrower) permitted by Section 7.06 and any Permitted
Refinancing thereof;
(j) Indebtedness incurred in a Permitted Acquisition, any other
Investment expressly permitted hereunder or any Disposition
constituting indemnification obligations or obligations in respect of
purchase price or other similar adjustments;
(k) Indebtedness consisting of obligations under deferred
compensation or other similar arrangements incurred by such Person in
connection with the Transaction and Permitted Acquisitions or any
other Investment expressly permitted hereunder;
(l) Cash Management Obligations and other Indebtedness in respect
of netting services, overdraft protections and similar arrangements in
each case in connection with deposit accounts;
(m) other Indebtedness of Restricted Subsidiaries that, when
aggregated with the aggregate outstanding Indebtedness of the Borrower
and the Restricted Subsidiaries secured by Liens permitted pursuant to
Section 7.01(y) and the aggregate sale price of the assets sold in
sale and leaseback transactions permitted pursuant to Section 7.05(f),
shall at no time exceed 7.5% of Consolidated Total Assets;
(n) Indebtedness consisting of the financing of insurance
premiums in an amount not to exceed the lesser of $75,000,000 and the
premiums with respect to the applicable insurance policies;
(o) Indebtedness incurred by any of the Restricted Subsidiaries
in respect of letters of credit, bank guarantees or similar
instruments issued or created in the ordinary course of business,
including in respect of workers compensation claims, health,
disability or other employee benefits or property, casualty or
liability insurance or self-insurance or other Indebtedness with
respect to reimbursement-type obligations regarding workers
compensation claims; PROVIDED that any reimbursement obligations in
respect thereof are reimbursed within 30 days following the incurrence
thereof;
(p) obligations in respect of performance, bid, appeal and surety
bonds and performance and completion guarantees and similar
obligations provided by any of the Restricted Subsidiaries or
obligations in respect of letters of credit, bank guarantees or
similar instruments related thereto, in each case in the ordinary
course of business or consistent with past practice;
(q) Indebtedness supported by a Letter of Credit, in a principal
amount not to exceed the face amount of such Letter of Credit;
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(r) Indebtedness in respect of the Student Loan Credit Facilities
in an aggregate principal amount of up to $150,000,000 at any time
outstanding; and
(s) all premiums (if any), interest (including post-petition
interest), fees, expenses, charges and additional or contingent
interest on obligations described in clauses (a) through (r) above.
SECTION 7.04. FUNDAMENTAL CHANGES. Merge, dissolve, liquidate,
consolidate with or into another Person, or Dispose of (whether in one
transaction or in a series of transactions) all or substantially all of its
assets (whether now owned or hereafter acquired) to or in favor of any Person,
except that:
(a) any Restricted Subsidiary may merge with (i) the Borrower
(including a merger, the purpose of which is to reorganize the Borrower into a
new jurisdiction); PROVIDED that (x) except in the case of a merger the purpose
of which is to reorganize the Borrower in a new jurisdiction, the Borrower shall
be the continuing or surviving Person and (y) such merger does not result in the
Borrower ceasing to be organized under the Laws of any state of the United
States or the District of Columbia, or (ii) any one or more other Subsidiaries;
PROVIDED that the continuing or surviving Person (x) shall be a Restricted
Subsidiary and (y) if either party to such merger was, immediately prior
thereto, a Loan Party, shall be a Loan Party;
(b) (i) any Subsidiary that is not a Loan Party may merge or
consolidate with or into any other Subsidiary that is not a Loan Party and (ii)
any Subsidiary may liquidate or dissolve or change its legal form if the
Borrower determines in good faith that such action is in the best interests of
the Borrower and the Subsidiaries and is not materially disadvantageous to the
Lenders;
(c) any Restricted Subsidiary may Dispose of all or substantially all
of its assets (upon voluntary liquidation or otherwise) to the Borrower or to
another Restricted Subsidiary; PROVIDED that if the transferor in such a
transaction is a Guarantor, then (i) the transferee must be the Borrower or a
Guarantor or (ii) to the extent constituting an Investment, such Investment must
be a permitted Investment in or Indebtedness of a Restricted Subsidiary which is
not a Loan Party in accordance with Sections 7.02 and 7.03, respectively;
(d) so long as no Default exists or would result therefrom, the
Borrower may merge with any other Person; PROVIDED that (i) the Borrower shall
be the continuing or surviving entity or (ii) if the Person formed by or
surviving any such merger or consolidation is not the Borrower (any such Person,
the "SUCCESSOR COMPANY"), (A) the Successor Company shall be an entity organized
or existing under the laws of any state of the United States or the District of
Columbia, (B) the Successor Company shall expressly assume all the obligations
of the Borrower under this Agreement and the other Loan Documents to which the
Borrower is a party pursuant to a supplement hereto or thereto in form
reasonably satisfactory to the Administrative Agent, (C) each Guarantor, unless
it is the other party to such merger or consolidation, shall have by a
supplement to the
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Guaranty confirmed that its Guarantee shall apply to the Successor Company's
obligations under this Agreement, (D) each Guarantor, unless it is the other
party to such merger or consolidation, shall have by a supplement to the Pledge
Agreement confirmed that its obligations thereunder shall apply to the Successor
Company's obligations under this Agreement, and (E) the Borrower shall have
delivered to the Administrative Agent a certificate of a Responsible Officer and
an opinion of counsel, each stating that such merger or consolidation and such
supplement to this Agreement or any Collateral Document comply with this
Agreement; PROVIDED, FURTHER, that if the foregoing are satisfied, the Successor
Company will succeed to, and be substituted for, the Borrower under this
Agreement;
(e) so long as no Default exists or would result therefrom, any
Restricted Subsidiary may merge with any other Person in order to effect an
Investment permitted pursuant to Section 7.02; PROVIDED that the continuing or
surviving Person shall be a Restricted Subsidiary, which together with each of
its Subsidiaries shall have complied with the applicable requirements of Section
6.11, if any;
(f) the Borrower and the Restricted Subsidiaries may consummate the
Mergers; and
(g) so long as no Default exists or would result therefrom, a merger,
dissolution, liquidation, consolidation or Disposition, the purpose of which is
to effect a Disposition permitted pursuant to Section 7.05.
SECTION 7.05. DISPOSITIONS. Make any Disposition or enter into any
agreement to make any Disposition, except:
(a) Dispositions of obsolete or worn out property and intellectual
property, whether now owned or hereafter acquired, in the ordinary course of
business and Dispositions of property no longer used or useful in the conduct of
the business of the Borrower and the Restricted Subsidiaries;
(b) Dispositions of inventory and immaterial assets in the ordinary
course of business;
(c) Dispositions of property to the extent that (i) such property is
exchanged for credit against the purchase price of similar replacement property
or (ii) the proceeds of such Disposition are promptly applied to the purchase
price of such replacement property;
(d) Dispositions of property to the Borrower or to a Restricted
Subsidiary; PROVIDED that if the transferor of such property is a Guarantor or
the Borrower (i) the transferee thereof must either be the Borrower or a
Guarantor or (ii) to the extent such transaction constitutes an Investment, such
transaction is permitted under Section 7.02;
(e) Dispositions permitted by Sections 7.04 and 7.06 and Liens
permitted by Section 7.01;
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(f) Dispositions of property pursuant to sale and leaseback
transactions; PROVIDED that, when aggregated with the aggregate outstanding
Indebtedness of the Borrower and the Restricted Subsidiaries secured by Liens
permitted pursuant to Section 7.01(y) and Indebtedness incurred pursuant to
Section 7.03(m), the aggregate sale price of the assets sold in sale and
leaseback transactions permitted pursuant to this clause (f), shall at no time
exceed 7.5% of Consolidated Total Assets;
(g) Dispositions of Cash Equivalents;
(h) Dispositions of accounts receivable in connection with the
collection or compromise thereof;
(i) leases, subleases, licenses or sublicenses, in each case in the
ordinary course of business and which do not materially interfere with the
business of the Borrower and the Restricted Subsidiaries;
(j) transfers of property subject to Casualty Events upon receipt of
the Net Cash Proceeds of such Casualty Event;
(k) Dispositions of property not otherwise permitted under this
Section 7.05; PROVIDED that (i) at the time of such Disposition (other than any
such Disposition made pursuant to a legally binding commitment entered into at a
time when no Default exists), no Default shall exist or would result from such
Disposition, (ii) (A) with respect to any Disposition pursuant to this clause
(k) for a purchase price in excess of $1,000,000, the Borrower or a Restricted
Subsidiary shall receive not less than 75% of such consideration in the form of
cash or Cash Equivalents (in each case, free and clear of all Liens at the time
received, other than nonconsensual Liens permitted by Section 7.01 and Liens
permitted by Sections 7.01(r) and (t)); PROVIDED, HOWEVER, that for the purposes
of this clause (A), (I) any liabilities (as shown on the Borrower's or such
Restricted Subsidiary's most recent balance sheet provided hereunder or in the
notes thereto) of the Borrower or such Restricted Subsidiary, other than
liabilities that are by their terms subordinated to the payment in cash of the
Obligations, that are assumed by the transferee with respect to the applicable
Disposition and for which the Borrower and all of the Restricted Subsidiaries
shall have been validly released by all applicable creditors in writing, (II)
any securities received by the Borrower or such Restricted Subsidiary from such
transferee that are converted by the Borrower or such Restricted Subsidiary into
cash (to the extent of the cash received) within 180 days following the closing
of the applicable Disposition and (III) any Designated Non-Cash Consideration
received by the Borrower or such Restricted Subsidiary in respect of such
Disposition having an aggregate fair market value, taken together with all other
Designated Non-Cash Consideration received pursuant to this clause (III) that is
at that time outstanding, not in excess of 1.5% of the Consolidated Total Assets
as of the last day of the then most recent fiscal quarter for which financial
statements have been delivered pursuant to Section 6.01 (or, prior to the
delivery thereof, the most recent financial statements referred to in Section
5.05) at the time of the receipt of such Designated Non-Cash Consideration, with
the fair market value of each item of Designated Non-Cash Consideration being
measured at the time received and without giving effect to subsequent changes in
value,
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shall be deemed to be cash, and (iii) with respect to property Disposed of in
reliance on this clause (k) the aggregate book value of which (taken together
with the aggregate fair market value of all property Disposed of pursuant to
Section 7.05(f)) exceeds 7.5% of Consolidated Total Assets as of the last day of
the most recent fiscal quarter of the Borrower for which financial statements
have been delivered pursuant to Section 6.01 (or, prior to the delivery thereof,
the most recent financial statements referred to in Section 5.05), the Net Cash
Proceeds of such Dispositions are used either (x) to purchase assets used in the
Borrower's or any of its Restricted Subsidiary's business within 365 days
following the closing of the applicable Disposition or (y) to repay (1) first,
the Term Loans, if any, (2) second, Incremental Loans, if any, and (3) third,
the Revolving Loans, if any, in each case within 5 days following the end of
such 365-day period;
(l) Each of the Dispositions listed on Schedule 7.05(l), PROVIDED
that, immediately after the consummation of such Disposition, the Total Leverage
Ratio shall be less than or equal to the Total Leverage Ratio as of the Closing
Date after giving effect to the Transactions;
(m) Dispositions of Investments in joint ventures to the extent
required by, or made pursuant to customary buy/sell arrangements between, the
joint venture parties set forth in joint venture arrangements and similar
binding arrangements;
(n) Dispositions of any Equity Interests in any statutory trust in
connection with the issuance of any trust preferred securities;
(o) Dispositions in connection with any Insurance Contract,
Reinsurance Agreement or Retrocession Agreement in the ordinary course of
business in accordance with its normal underwriting, indemnity and retention
policies; and
(p) Dispositions of Investments by an Insurance Subsidiary in the
ordinary course of business in connection with the management of its investment
portfolio; PROVIDED that the proceeds thereof are utilized to satisfy policy
liabilities and expenses incurred in the ordinary course of business, are
reinvested in accordance with Section 7.02 or are held as cash;
PROVIDED that any Disposition of any property pursuant to this Section 7.05
(except pursuant to Section 7.05(e) and except for Dispositions from a Loan
Party to another Loan Party), shall be for no less than the fair market value of
such property at the time of such Disposition. To the extent any Collateral is
Disposed of as expressly permitted by this Section 7.05 to any Person other than
Holdings, the Borrower or any Restricted Subsidiary, such Collateral shall be
sold free and clear of the Liens created by the Loan Documents, and the
Administrative Agent or the Collateral Agent, as applicable, shall be authorized
to take any actions deemed appropriate in order to effect the foregoing.
Notwithstanding anything to the contrary contained in Section 7.05(k), to the
extent that (i) funds for any repayment otherwise required to be made pursuant
to the terms of Section 7.05(k)(iii)(y) are only available to the Borrower
through dividend payments to the Borrower from one or more Insurance
Subsidiaries, (ii) such dividend payments
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cannot be made at such time within the ordinary dividend-paying capacity of such
Insurance Subsidiary or Subsidiaries and, accordingly, require specific
affirmative regulatory approval for the payment of extraordinary dividends and
(iii) after due written application or request, such approval for the payment of
such extraordinary dividends is not obtained by such Insurance Subsidiary, upon
certification by the Borrower to the Administrative Agent (which shall promptly
deliver a copy of such certification to the Lenders) to such effect (together
with, in the case of an application or request for regulatory approval, copies
of all documents submitted, and all written responses received, in connection
therewith), the Borrower shall not, to such extent, be required to make such
repayment for so long as such dividend payments may not, for such reasons, be
made, PROVIDED that if the Borrower shall not be so permitted to make such
dividend payments during the applicable 365 day period, then the Borrower shall
thereafter make such repayments no later than 5 days following the date when
such dividend payments may be made.
SECTION 7.06. RESTRICTED PAYMENTS. During any Non-Investment Grade
Period, declare or make, directly or indirectly, any Restricted Payment, except:
(a) each Restricted Subsidiary may make Restricted Payments to the
Borrower and to other Restricted Subsidiaries (and, in the case of a Restricted
Payment by a non-wholly owned Restricted Subsidiary, to the Borrower and any
other Restricted Subsidiary and to each other owner of Equity Interests of such
Restricted Subsidiary based on their relative ownership interests of the
relevant class of Equity Interests);
(b) the Borrower and each Restricted Subsidiary may declare and make
dividend payments or other distributions payable solely in the Equity Interests
(other than Disqualified Equity Interests not otherwise permitted by Section
7.03) of such Person;
(c) Restricted Payments made on the Closing Date to consummate the
Transaction;
(d) to the extent constituting Restricted Payments, the Borrower and
the Restricted Subsidiaries may enter into and consummate transactions expressly
permitted by any provision of Section 7.04 or 7.08 (other than Section 7.08(f));
(e) repurchases of Equity Interests in the Borrower or any Restricted
Subsidiary deemed to occur upon exercise of stock options or warrants if such
Equity Interests represent a portion of the exercise price of such options or
warrants;
(f) Borrower may make Restricted Payments to Holdings to enable
Holdings to pay (or make Restricted Payments to allow any direct or indirect
parent thereof to pay), or after a Qualifying IPO the Borrower may pay, for the
repurchase, retirement or other acquisition or retirement for value of Equity
Interests of Holdings (or of any such parent of Holdings or of the Borrower
after a Qualifying IPO of the Borrower) held by any future, present or former
employee, independent agent or director of Holdings (or any direct or indirect
parent of Holdings) or any of its Subsidiaries pursuant to any employee,
independent agent or director equity plan, employee,
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independent agent or director stock option plan or any other employee,
independent agent or director benefit plan or any agreement (including any stock
subscription or shareholder agreement) with any employee, independent agent or
director of Holdings or any of its Subsidiaries;
(g) the Borrower and the Restricted Subsidiaries may make Restricted
Payments to Holdings:
(i) the proceeds of which will be used to pay (or to make Restricted
Payments to allow any direct or indirect parent of Holdings to pay) the tax
liability to each relevant jurisdiction in respect of consolidated,
combined, unitary or affiliated returns for the relevant jurisdiction of
Holdings (or such parent) attributable to Holdings, the Borrower or its
Subsidiaries determined as if the Borrower and the Subsidiaries filed
separately;
(ii) the proceeds of which shall be used by Holdings to pay (or to
make Restricted Payments to allow any direct or indirect parent of Holdings
to pay) its operating expenses incurred in the ordinary course of business
and other corporate overhead costs and expenses (including administrative,
legal, accounting and similar expenses provided by third parties and
indemnity claims made by directors or officers of Holdings (or any parent
thereof)), which are reasonable and customary and incurred in the ordinary
course of business and attributable to the ownership or operations of the
Borrower and the Subsidiaries;
(iii) the proceeds of which shall be used by Holdings to pay franchise
taxes and other fees, taxes and expenses required to maintain its (or any
of its direct or indirect parents') corporate existence;
(iv) to finance any Investment permitted to be made pursuant to
Section 7.02; PROVIDED that (A) such Restricted Payment shall be made
substantially concurrently with the closing of such Investment and (B)
Holdings shall, immediately following the closing thereof, cause (1) all
property acquired (whether assets or Equity Interests) to be contributed to
the Borrower or the Restricted Subsidiaries or (2) the merger (to the
extent permitted in Section 7.04) of the Person formed or acquired into the
Borrower or a Restricted Subsidiary in order to consummate such Permitted
Investment, in each case, to the extent applicable, in accordance with the
requirements of Section 6.11;
(v) the proceeds of which shall be used by Holdings to pay (or to make
Restricted Payments to allow any direct or indirect parent thereof to pay)
fees and expenses (other than to Affiliates) related to any unsuccessful
equity or debt offering permitted by this Agreement; and
(vi) the proceeds of which shall be used by Holdings to pay (or to
make Restricted Payments to allow any direct or indirect parent thereof to
pay) fees and expenses of the type described in Section 7.08(e) and (m);
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(h) regularly scheduled dividends in respect of Qualified Trust
Preferred Securities; and
(i) any other Restricted Payments, PROVIDED that immediately after
giving Pro Forma Effect to any such Restricted Payments, the Borrower and the
Restricted Subsidiaries shall be in Pro Forma Compliance with the covenants set
forth in Section 7.09.
SECTION 7.07. CHANGE IN NATURE OF BUSINESS. Engage in any material
line of business substantially different from those lines of business conducted
by the Borrower and the Restricted Subsidiaries on the date hereof or any
business reasonably related or ancillary thereto, or a reasonable extension,
development or expansion thereof.
SECTION 7.08. TRANSACTIONS WITH AFFILIATES. During any Non-Investment
Grade Period, enter into any transaction of any kind with any Affiliate of the
Borrower, whether or not in the ordinary course of business, other than (a)
transactions among the Borrower and any Restricted Subsidiary or any entity that
becomes a Restricted Subsidiary as a result of such transaction, (b) on terms
substantially as favorable to the Borrower or such Restricted Subsidiary as
would be obtainable by the Borrower or such Restricted Subsidiary at the time in
a comparable arm's-length transaction with a Person other than an Affiliate, (c)
the payment of fees and expenses related to the Transaction, (d) the issuance of
Equity Interests to the management, consultants, employees or independent agents
of the Borrower or any of its Subsidiaries in connection with the Transaction,
(e) the payment of management and monitoring fees to the Investors in an
aggregate amount in any fiscal year not to exceed the greater of (i) $15,000,000
and (ii) the product of (x) three percent and (y) the Consolidated EBITDA for
such fiscal year, plus any Management Termination Fee, (f) equity issuances,
repurchases, retirements or other acquisitions or retirements of, and capital
contributions by Holdings in respect of, Equity Interests of the Borrower not
prohibited under Section 7.06, (g) loans and other transactions by the Borrower
and the Restricted Subsidiaries to the extent permitted under this Article VII,
(h) employment and severance arrangements between the Borrower and the
Restricted Subsidiaries and their respective officers, independent agents,
consultants and employees in the ordinary course of business, (i) payments by
the Borrower and the Restricted Subsidiaries pursuant to the tax sharing
agreements among Holdings (and any parent thereof), the Borrower and the
Restricted Subsidiaries on customary terms to the extent attributable to the
ownership or operation of the Borrower and the Restricted Subsidiaries, (j) the
payment of customary fees and reasonable out-of-pocket costs to, and indemnities
provided on behalf of, directors, officers, independent agents, consultants and
employees of Holdings, the Borrower and the Restricted Subsidiaries in the
ordinary course of business to the extent attributable to the ownership or
operation of Holdings, the Borrower and the Restricted Subsidiaries, (k)
transactions pursuant to permitted agreements in existence on the Closing Date
and set forth on Schedule 7.08 or any amendment thereto to the extent such an
amendment is not adverse to the Lenders in any material respect, (l) dividends,
redemptions and repurchases permitted under Section 7.06, (m) customary payments
by the Borrower and any Restricted Subsidiaries to the Investors made for any
financial advisory, financing, underwriting or placement services or in respect
of other investment
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banking activities (including in connection with acquisitions or divestitures),
which payments are approved by the majority of the members of the board of
directors or a majority of the disinterested members of the board of directors
of Holdings or the Borrower, in good faith, and (n) transactions entered into
during a Collateral Release Period that would otherwise be prohibited under this
Section 7.08 during a Non-Investment Grade Period.
SECTION 7.09. FINANCIAL COVENANTS. (a) TOTAL LEVERAGE RATIO. Permit
the Total Leverage Ratio as of the last day of any Test Period (beginning with
the Test Period ending on March 31, 2007) to be greater than the ratio set forth
below opposite the last day of such Test Period:
FISCAL YEAR MARCH 31 JUNE 30 SEPTEMBER 30 DECEMBER 31
2007 3.00:1 3.00:1 3.00:1 3.00:1
2008 3.00:1 3.00:1 3.00:1 3.00:1
2009 2.90:1 2.90:1 2.80:1 2.80:1
2010 2.80:1 2.80:1 2.70:1 2.70:1
2011 2.70:1 2.70:1 2.60:1 2.60:1
2012 2.60:1 2.60:1 2.60:1 --
(b) ADJUSTED STATUTORY SURPLUS. At any time permit the Adjusted
Statutory Surplus to be less than $300,000,000 (minus, after the Disposition
thereof, the Adjusted Statutory Surplus related to Student and Star).
SECTION 7.10. ACCOUNTING CHANGES. Make any change in fiscal year;
PROVIDED, HOWEVER, that the Borrower may, upon written notice to the
Administrative Agent, change its fiscal year to any other fiscal year reasonably
acceptable to the Administrative Agent, in which case, the Borrower and the
Administrative Agent will, and are hereby authorized by the Lenders to, make any
adjustments to this Agreement that are necessary to reflect such change in
fiscal year.
SECTION 7.11. EQUITY INTERESTS OF THE BORROWER AND RESTRICTED
SUBSIDIARIES. Permit any Insurance Subsidiary that is a Domestic Subsidiary to
be a non-wholly owned Restricted Subsidiary, except as a result of or in
connection with a dissolution, merger, consolidation or Disposition of such
Subsidiary permitted by Section 7.04, 7.05 or an Investment in any Person
permitted under Section 7.02.
ARTICLE VIIA
HOLDINGS COVENANT
So long as any Lender shall have any Commitment hereunder, any Loan
or other Obligation hereunder which is accrued and payable shall remain unpaid
or unsatisfied, or any Letter of Credit shall remain outstanding, Holdings will
not create, incur, assume or permit to exist any Lien (other than nonconsensual
Liens) on any of the
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Equity Interests issued by the Borrower other than the Liens created under the
Loan Documents.
ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES
SECTION 8.01. EVENTS OF DEFAULT. Any of the following shall
constitute an Event of Default:
(a) NON-PAYMENT. The Borrower or any other Loan Party fails to pay
(i) when and as required to be paid herein, any amount of principal of any Loan,
or (ii) within five (5) Business Days after the same becomes due, any interest
on any Loan or any other amount payable hereunder or with respect to any other
Loan Document; or
(b) SPECIFIC COVENANTS. The Borrower fails to perform or observe any
term, covenant or agreement contained in any of Sections 6.03(a) or 6.05(a)
(solely with respect to Holdings and the Borrower) or Article VII; PROVIDED that
any Event of Default under Section 7.09 is subject to cure as contemplated by
Section 8.04; or
(c) OTHER DEFAULTS. Any Loan Party fails to perform or observe any
other covenant or agreement (not specified in Section 8.01(a) or (b) above)
contained in any Loan Document on its part to be performed or observed and such
failure continues for thirty (30) days after notice thereof by the
Administrative Agent to the Borrower; or
(d) REPRESENTATIONS AND WARRANTIES. Any representation, warranty,
certification or statement of fact made or deemed made by or on behalf of the
Borrower or any other Loan Party herein, in any other Loan Document, or in any
document required to be delivered in connection herewith or therewith shall be
incorrect or misleading in any material respect when made or deemed made; or
(e) CROSS-DEFAULT. Any Loan Party or any Restricted Subsidiary
(A) fails to make any payment beyond the applicable grace period with respect
thereto, if any (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise), in respect of any Indebtedness (other than
Indebtedness hereunder) having an aggregate principal amount of not less than
the Threshold Amount, or (B) fails to observe or perform any other agreement or
condition relating to any such Indebtedness, or any other event occurs (other
than, with respect to Indebtedness consisting of Swap Contracts, termination
events or equivalent events pursuant to the terms of such Swap Contracts), the
effect of which default or other event is to cause, or to permit the holder or
holders of such Indebtedness (or a trustee or agent on behalf of such holder or
holders or beneficiary or beneficiaries) to cause, with the giving of notice if
required, such Indebtedness to become due or to be repurchased, prepaid,
defeased or redeemed (automatically or otherwise), or an offer to repurchase,
prepay, defease or redeem such Indebtedness to be made, prior to its stated
maturity; PROVIDED that this clause (e)(B) shall not apply to secured
Indebtedness that becomes due as a result of the voluntary sale or transfer of
the
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property or assets securing such Indebtedness, if such sale or transfer is
permitted hereunder and under the documents providing for such Indebtedness; or
(f) INSOLVENCY PROCEEDINGS, ETC. Any Loan Party or any of the
Restricted Subsidiaries institutes or consents to the institution of any
proceeding relating to it under any Debtor Relief Law, or makes an assignment
for the benefit of creditors; or applies for or consents to the appointment of
any receiver, trustee, custodian, conservator, liquidator, rehabilitator,
administrator, administrative receiver or similar officer for it or for all or
any material part of its property; or any receiver, trustee, custodian,
conservator, liquidator, rehabilitator, administrator, administrative receiver
or similar officer is appointed without the application or consent of such
Person and the appointment continues undischarged or unstayed for sixty (60)
calendar days; or any proceeding under any Debtor Relief Law relating to any
such Person or to all or any material part of its property is instituted without
the consent of such Person and continues undismissed or unstayed for sixty (60)
calendar days, or an order for relief is entered in any such proceeding; or
(g) INABILITY TO PAY DEBTS; ATTACHMENT. (i) Any Loan Party or any
Restricted Subsidiary becomes unable or admits in writing its inability or fails
generally to pay its debts in excess of the Threshold Amount as they become due,
or (ii) any writ or warrant of attachment or execution or similar process is
issued or levied against all or any material part of the property of the Loan
Parties, taken as a whole, and is not released, vacated or fully bonded within
sixty (60) days after its issue or levy; or
(h) JUDGMENTS. There is entered against any Loan Party or any
Subsidiary a final judgment or order for the payment of money in an aggregate
amount exceeding the Threshold Amount (to the extent not covered by independent
third-party insurance as to which the insurer has been notified of such judgment
or order and has not denied coverage) and such judgment or order shall not have
been satisfied, vacated, discharged or stayed or bonded pending an appeal for a
period of sixty (60) consecutive days; or
(i) ERISA. An ERISA Event occurs with respect to a Pension Plan or
Multiemployer Plan which has resulted or could reasonably be expected to result
in liability of any Loan Party under Title IV of ERISA in an aggregate amount
which could reasonably be expected to result in a Material Adverse Effect; or
(j) INVALIDITY OF LOAN DOCUMENTS. Any material provision of any Loan
Document, at any time after its execution and delivery and for any reason other
than as expressly permitted hereunder or thereunder (including as a result of a
transaction permitted under Section 7.04 or 7.05) or as a result of acts or
omissions by the Administrative Agent or any Lender or the satisfaction in full
of all the Obligations, ceases to be in full force and effect; or any Loan Party
contests in writing the validity or enforceability of any provision of any Loan
Document; or any Loan Party denies in writing that it has any or further
liability or obligation under any Loan Document (other than as a result of
repayment in full of the Obligations and termination of the Aggregate
Commitments or as expressly contemplated by the Loan Documents), or purports in
writing to revoke or rescind any Loan Document; or
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(k) CHANGE OF CONTROL. There occurs any Change of Control.
SECTION 8.02. REMEDIES UPON EVENT OF DEFAULT. If any Event of Default
occurs and is continuing, the Administrative Agent may and, at the request of
the Required Lenders, shall take any or all of the following actions:
(a) declare the commitment of each Lender to make Loans and any
obligation of the L/C Issuers to make L/C Credit Extensions to be terminated,
whereupon such commitments and obligation shall be terminated;
(b) declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Borrower;
(c) require that the Borrower Cash Collateralize the L/C Obligations
(in an amount equal to the then Outstanding Amount thereof); and
(d) exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents or applicable
Law;
PROVIDED that upon the occurrence of an actual or deemed entry of an order for
relief with respect to the Borrower under the Bankruptcy Code of the United
States, the obligation of each Lender to make Loans and any obligation of the
L/C Issuers to make L/C Credit Extensions shall automatically terminate, the
unpaid principal amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable, and the
obligation of the Borrower to Cash Collateralize the L/C Obligations as
aforesaid shall automatically become effective, in each case without further act
of the Administrative Agent or any Lender.
SECTION 8.03. APPLICATION OF FUNDS. After the exercise of remedies
provided for in Section 8.02 (or after the Loans have automatically become
immediately due and payable and the L/C Obligations have automatically been
required to be Cash Collateralized as set forth in the proviso to Section 8.02),
any amounts received on account of the Obligations shall be applied by the
Administrative Agent in the following order:
FIRST, to payment of that portion of the Obligations constituting
fees, indemnities, expenses and other amounts (other than principal and
interest, but including Attorney Costs payable under Section 10.04 and
amounts payable under Article III) payable to the Administrative Agent in
its capacity as such;
SECOND, to payment of that portion of the Obligations constituting
fees, indemnities and other amounts (other than principal and interest)
payable to the Lenders (including Attorney Costs payable under Section
10.05 and amounts payable under Article III), ratably among them in
proportion to the amounts described in this clause SECOND payable to them;
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THIRD, to payment of that portion of the Obligations constituting
accrued and unpaid interest on the Loans and L/C Borrowings, ratably among
the Lenders in proportion to the respective amounts described in this
clause THIRD payable to them;
FOURTH, to payment of that portion of the Obligations constituting
unpaid principal of the Loans and L/C Borrowings, the termination value
under Secured Hedge Agreements and the Cash Management Obligations,
ratably among the Lenders in proportion to the respective amounts
described in this clause FOURTH held by them;
FIFTH, to the Administrative Agent for the account of the L/C
Issuers, to Cash Collateralize that portion of L/C Obligations comprised
of the aggregate undrawn amount of Letters of Credit;
SIXTH, to the payment of all other Obligations of the Loan Parties
(other than the Obligations described in clauses FIRST through FIFTH) that
are due and payable to the Administrative Agent and the other Secured
Parties on such date, ratably based upon the respective aggregate amounts
of all such Obligations owing to the Administrative Agent and the other
Secured Parties on such date; and
LAST, the balance, if any, after all of the Obligations have been
indefeasibly paid in full, to the Borrower or as otherwise required by
Law.
Subject to Section 2.03(c), amounts used to Cash Collateralize the aggregate
undrawn amount of Letters of Credit pursuant to clause FIFTH above shall be
applied to satisfy drawings under such Letters of Credit as they occur. If any
amount remains on deposit as Cash Collateral after all Letters of Credit have
either been fully drawn or expired, such remaining amount shall be applied to
the other Obligations, if any, in the order set forth above and, if no
Obligations remain outstanding, to the Borrower.
SECTION 8.04. BORROWER'S RIGHT TO CURE. (a) Notwithstanding anything
to the contrary contained in Section 8.01, in the event of any Event of Default
under any covenant set forth in Section 7.09 and until the expiration of the
tenth (10th) day after the date on which financial statements are required to be
delivered with respect to the applicable fiscal quarter hereunder, Holdings (or
the Borrower after a Qualifying IPO of the Borrower) may engage in a Permitted
Equity Issuance to any of the Equity Investors and apply the amount of the Net
Cash Proceeds thereof to increase Consolidated EBITDA with respect to such
applicable quarter; PROVIDED that such Net Cash Proceeds (i) are actually
received by the Borrower (including through capital contribution of such Net
Cash Proceeds by Holdings to the Borrower) no later than ten (10) days after the
date on which financial statements are required to be delivered with respect to
such fiscal quarter hereunder and (ii) do not exceed the aggregate amount
necessary to cure such Event of Default under Section 7.09 for any applicable
period; PROVIDED, HOWEVER, that such increase in Consolidated EBITDA shall be
disregarded for purposes of Section 7.06(i) in determining the Borrower's and
the Restricted Subsidiaries' Pro Forma
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Compliance with the covenants set forth in Section 7.09. The parties hereby
acknowledge that this Section 8.04(a) shall not be relied on for purposes of
calculating any financial ratios other than as applicable to Section 7.09 and
shall not result in any adjustment to any amounts other than the amount of the
Consolidated EBITDA referred to in the immediately preceding sentence.
(b) In each period of four fiscal quarters, there shall be at least
two (2) consecutive fiscal quarters in which no cure set forth in Section
8.04(a) is made.
SECTION 8.05. EXCLUSION OF IMMATERIAL SUBSIDIARIES. Solely for the
purpose of determining whether a Default has occurred under clause (f) or (g) of
Section 8.01, any reference in any such clause to any Subsidiary or Loan Party
shall be deemed not to include any Subsidiary affected by any event or
circumstances referred to in any such clause that did not, as of the last day of
the most recent completed fiscal quarter of the Borrower, have assets with a
value in excess of 3% of the Consolidated Total Assets and did not, as of the
four quarter period ending on the last day of such fiscal quarter, have revenues
exceeding 3% of the total revenues of the Borrower and the Restricted
Subsidiaries, PROVIDED that all Subsidiaries affected by any event or
circumstance referred to in any such clause shall not, in the aggregate (1) as
of the last day of the most recent completed fiscal quarter of the Borrower have
assets with a value in excess of 8% of the Consolidated Total Assets and (2)
shall not, as of the four quarter period ending on the last day of such fiscal
quarter, have revenues exceeding 8% of the total revenues of the Borrower and
the Restricted Subsidiaries.
ARTICLE IX
ADMINISTRATIVE AGENT AND OTHER AGENTS
SECTION 9.01. APPOINTMENT AND AUTHORIZATION OF AGENTS. (a) Each Lender
hereby irrevocably appoints, designates and authorizes the Administrative Agent
to take such action on its behalf under the provisions of this Agreement and
each other Loan Document and to exercise such powers and perform such duties as
are expressly delegated to it by the terms of this Agreement or any other Loan
Document, together with such powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary contained elsewhere herein or in
any other Loan Document, the Administrative Agent shall have no duties or
responsibilities, except those expressly set forth herein, nor shall the
Administrative Agent have or be deemed to have any fiduciary relationship with
any Lender or participant, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the
Administrative Agent. Without limiting the generality of the foregoing sentence,
the use of the term "agent" herein and in the other Loan Documents with
reference to any Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable Law.
Instead, such term is used merely as a matter of market custom, and is intended
to create or reflect only an administrative relationship between independent
contracting parties.
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(b) Each L/C Issuer shall act on behalf of the Lenders with respect to
any Letters of Credit issued by it and the documents associated therewith, and
each such L/C Issuer shall have all of the benefits and immunities (i) provided
to the Agents in this Article IX with respect to any acts taken or omissions
suffered by such L/C Issuer in connection with Letters of Credit issued by it or
proposed to be issued by it and the applications and agreements for letters of
credit pertaining to such Letters of Credit as fully as if the term "Agent" as
used in this Article IX and in the definition of "Agent-Related Person" included
such L/C Issuer with respect to such acts or omissions, and (ii) as additionally
provided herein with respect to such L/C Issuer.
(c) The Administrative Agent shall also act as the "collateral agent"
under the Loan Documents, and each of the Lenders (in its capacities as a
Lender, L/C Issuer (if applicable) and a potential Hedge Bank) hereby
irrevocably appoints and authorizes the Administrative Agent to act as the agent
of (and to hold any security interest created by the Collateral Documents for
and on behalf of or on trust for) such Lender for purposes of acquiring, holding
and enforcing any and all Liens on Collateral granted by any of the Loan Parties
to secure any of the Secured Obligations, together with such powers and
discretion as are reasonably incidental thereto. In this connection, the
Administrative Agent, as "collateral agent" (and any co-agents and
attorneys-in-fact appointed by the Administrative Agent pursuant to Section 9.02
for purposes of holding or enforcing any Lien on the Collateral (or any portion
thereof) granted under the Collateral Documents, or for exercising any rights
and remedies thereunder at the direction of the Administrative Agent), shall be
entitled to the benefits of all provisions of this Article IX (including Section
9.07, as though such co-agents and attorneys-in-fact were the "collateral agent"
under the Loan Documents) as if set forth in full herein with respect thereto.
SECTION 9.02. DELEGATION OF DUTIES. The Administrative Agent may
execute any of its duties under this Agreement or any other Loan Document
(including for purposes of holding or enforcing any Lien on the Collateral (or
any portion thereof) granted under the Collateral Documents or of exercising any
rights and remedies thereunder) by or through agents, employees or
attorneys-in-fact, and shall be entitled to advice of counsel and other
consultants or experts concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the negligence or misconduct
of any agent or attorney-in-fact that it selects in the absence of gross
negligence or willful misconduct (as determined in the final judgment of a court
of competent jurisdiction).
SECTION 9.03. LIABILITY OF AGENTS. No Agent-Related Person shall (a)
be liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct,
as determined by the final judgment of a court of competent jurisdiction, in
connection with its duties expressly set forth herein), or (b) be responsible in
any manner to any Lender or participant for any recital, statement,
representation or warranty made by any Loan Party or any officer thereof,
contained herein or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by the
Administrative Agent under or in connection with, this Agreement or any other
110
Loan Document, or the validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Loan Document, or the perfection or
priority of any Lien or security interest created or purported to be created
under the Collateral Documents, or for any failure of any Loan Party or any
other party to any Loan Document to perform its obligations hereunder or
thereunder. No Agent-Related Person shall be under any obligation to any Lender
or participant to ascertain or to inquire as to the observance or performance of
any of the agreements contained in, or conditions of, this Agreement or any
other Loan Document, or to inspect the properties, books or records of any Loan
Party or any Affiliate thereof.
SECTION 9.04. RELIANCE BY AGENTS. (a) Each Agent shall be entitled to
rely, and shall be fully protected in relying, upon any writing, communication,
signature, resolution, representation, notice, consent, certificate, affidavit,
letter, telegram, facsimile, telex or telephone message, electronic mail
message, statement or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons, and upon advice and statements of legal counsel (including counsel
to any Loan Party), independent accountants and other experts selected by such
Agent. Each Agent shall be fully justified in failing or refusing to take any
action under any Loan Document unless it shall first receive such advice or
concurrence of the Required Lenders as it deems appropriate and, if it so
requests, it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. Each Agent shall in all cases
be fully protected in acting, or in refraining from acting, under this Agreement
or any other Loan Document in accordance with a request or consent of the
Required Lenders (or such greater number of Lenders as may be expressly required
hereby in any instance) and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 4.01, each Lender that has signed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter required thereunder to be consented to or approved by
or acceptable or satisfactory to a Lender unless the Administrative Agent shall
have received notice from such Lender prior to the proposed Closing Date
specifying its objection thereto.
SECTION 9.05. NOTICE OF DEFAULT. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default, except with
respect to defaults in the payment of principal, interest and fees required to
be paid to the Administrative Agent for the account of the Lenders, unless the
Administrative Agent shall have received written notice from a Lender or the
Borrower referring to this Agreement, describing such Default and stating that
such notice is a "notice of default". The Administrative Agent will notify the
Lenders of its receipt of any such notice. The Administrative Agent shall take
such action with respect to any Event of Default as may be directed by the
Required Lenders in accordance with Article VIII; PROVIDED that unless and until
the Administrative Agent has received any such direction, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such
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action, with respect to such Event of Default as it shall deem advisable or in
the best interest of the Lenders.
SECTION 9.06. CREDIT DECISION; DISCLOSURE OF INFORMATION BY AGENTS.
Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by any Agent hereafter taken,
including any consent to and acceptance of any assignment or review of the
affairs of any Loan Party or any Affiliate thereof, shall be deemed to
constitute any representation or warranty by any Agent-Related Person to any
Lender as to any matter, including whether Agent-Related Persons have disclosed
material information in their possession. Each Lender represents to each Agent
that it has, independently and without reliance upon any Agent-Related Person
and based on such documents and information as it has deemed appropriate, made
its own appraisal of and investigation into the business, prospects, operations,
property, financial and other condition and creditworthiness of the Loan Parties
and their respective Subsidiaries, and all applicable bank or other regulatory
Laws relating to the transactions contemplated hereby, and made its own decision
to enter into this Agreement and to extend credit to the Borrower and the other
Loan Parties hereunder. Each Lender also represents that it will, independently
and without reliance upon any Agent-Related Person and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make such
investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Borrower and the other Loan Parties. Except for notices,
reports and other documents expressly required to be furnished to the Lenders by
any Agent herein, such Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning the business,
prospects, operations, property, financial and other condition or
creditworthiness of any of the Loan Parties or any of their respective
Affiliates which may come into the possession of any Agent-Related Person.
SECTION 9.07. INDEMNIFICATION OF AGENTS. Whether or not the
transactions contemplated hereby are consummated, the Lenders shall indemnify
upon demand each Agent-Related Person (to the extent not reimbursed by or on
behalf of any Loan Party and without limiting the obligation of any Loan Party
to do so), pro rata, and hold harmless each Agent-Related Person from and
against any and all Indemnified Liabilities incurred by it; PROVIDED, that no
Lender shall be liable for the payment to any Agent-Related Person of any
portion of such Indemnified Liabilities resulting from such Agent-Related
Person's own gross negligence or willful misconduct, as determined by the final
judgment of a court of competent jurisdiction; PROVIDED, FURTHER, that no action
taken in accordance with the directions of the Required Lenders (or such other
number or percentage of the Lenders as shall be required by the Loan Documents)
shall be deemed to constitute gross negligence or willful misconduct for
purposes of this Section 9.07. In the case of any investigation, litigation or
proceeding giving rise to any Indemnified Liabilities, this Section 9.07 applies
whether any such investigation, litigation or proceeding is brought by any
Lender or any other Person. Without limitation of the foregoing, each Lender
shall reimburse the Administrative Agent upon demand for its ratable share of
any costs or out-of-pocket expenses (including Attorney Costs) incurred
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by the Administrative Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of rights or responsibilities under, this Agreement, any other Loan
Document, or any document contemplated by or referred to herein, to the extent
that the Administrative Agent is not reimbursed for such expenses by or on
behalf of the Borrower. The undertaking in this Section 9.07 shall survive
termination of the Aggregate Commitments, the payment of all other Obligations
and the resignation of the Administrative Agent.
SECTION 9.08. AGENTS IN THEIR INDIVIDUAL CAPACITIES. JPMorgan Chase
Bank and its Affiliates may make loans to, issue letters of credit for the
account of, accept deposits from, acquire Equity Interests in and generally
engage in any kind of banking, trust, financial advisory, underwriting or other
business with each of the Loan Parties and their respective Affiliates as though
JPMorgan Chase Bank were not the Administrative Agent or an L/C Issuer hereunder
and without notice to or consent of the Lenders. The Lenders acknowledge that,
pursuant to such activities, JPMorgan Chase Bank or its Affiliates may receive
information regarding any Loan Party or its Affiliates (including information
that may be subject to confidentiality obligations in favor of such Loan Party
or such Affiliate) and acknowledge that the Administrative Agent shall be under
no obligation to provide such information to them. With respect to its Loans,
JPMorgan Chase Bank shall have the same rights and powers under this Agreement
as any other Lender and may exercise such rights and powers as though it were
not the Administrative Agent or an L/C Issuer, and the terms "Lender" and
"Lenders" include JPMorgan Chase Bank in its individual capacity.
SECTION 9.09. SUCCESSOR AGENTS. The Administrative Agent may resign as
the Administrative Agent upon thirty (30) days' notice to the Lenders and the
Borrower. If the Administrative Agent resigns under this Agreement, the Required
Lenders shall appoint from among the Lenders a successor agent for the Lenders,
which successor agent shall be consented to by the Borrower at all times other
than during the existence of an Event of Default under Section 8.01(f) or (g)
(which consent of the Borrower shall not be unreasonably withheld or delayed).
If no successor agent is appointed prior to the effective date of the
resignation of the Administrative Agent, the Administrative Agent may appoint,
after consulting with the Lenders and the Borrower, a successor agent from among
the Lenders. Upon the acceptance of its appointment as successor agent
hereunder, the Person acting as such successor agent shall succeed to all the
rights, powers and duties of the retiring Administrative Agent and the term
"Administrative Agent", shall mean such successor administrative agent and/or
supplemental administrative agent, as the case may be, and the retiring
Administrative Agent's appointment, powers and duties as the Administrative
Agent shall be terminated. After the retiring Administrative Agent's resignation
hereunder as the Administrative Agent, the provisions of this Article IX and
Sections 10.04 and 10.05 shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was the Administrative Agent under this
Agreement. If no successor agent has accepted appointment as the Administrative
Agent by the date which is thirty (30) days following the retiring
Administrative Agent's notice of resignation, the retiring Administrative
Agent's resignation shall nevertheless thereupon become effective and the
Lenders shall perform
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all of the duties of the Administrative Agent hereunder until such time, if any,
as the Required Lenders appoint a successor agent as provided for above. Upon
the acceptance of any appointment as the Administrative Agent hereunder by a
successor and upon the execution and filing or recording of such financing
statements, or amendments thereto, and such other instruments or notices, as may
be necessary or desirable, or as the Required Lenders may request, in order to
(a) continue the perfection of the Liens granted or purported to be granted by
the Collateral Documents or (b) otherwise ensure that the Collateral and
Guarantee Requirement is satisfied, the Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, discretion,
privileges, and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations under
the Loan Documents. After the retiring Administrative Agent's resignation
hereunder as the Administrative Agent, the provisions of this Article IX shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as the Administrative Agent.
SECTION 9.10. ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM. In case
of the pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to any Loan Party, the Administrative Agent (irrespective of
whether the principal of any Loan or L/C Obligation shall then be due and
payable as herein expressed or by declaration or otherwise and irrespective of
whether the Administrative Agent shall have made any demand on the Borrower)
shall be entitled and empowered, by intervention in such proceeding or
otherwise:
(a) to file and prove a claim for the whole amount of the principal
and interest owing and unpaid in respect of the Loans, L/C Obligations and all
other Obligations that are owing and unpaid and to file such other documents as
may be necessary or advisable in order to have the claims of the Lenders and the
Administrative Agent (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Lenders and the Administrative Agent
and their respective agents and counsel and all other amounts due the Lenders
and the Administrative Agent under Sections 2.03(h) and (i), 2.09 and 10.04)
allowed in such judicial proceeding; and
(b) to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to the Administrative Agent and, in the event
that the Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to the Administrative Agent any amount due for
the reasonable compensation, expenses, disbursements and advances of the Agents
and their respective agents and counsel, and any other amounts due the
Administrative Agent under Sections 2.09 and 10.04.
Nothing contained herein shall be deemed to authorize the
Administrative Agent to authorize or consent to or accept or adopt on behalf of
any Lender any plan of
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reorganization, arrangement, adjustment or composition affecting the Obligations
or the rights of any Lender or to authorize the Administrative Agent to vote in
respect of the claim of any Lender in any such proceeding.
SECTION 9.11. COLLATERAL AND GUARANTY MATTERS. The Lenders irrevocably
agree:
(a) that any Lien on any property granted to or held by the
Administrative Agent or the Collateral Agent under any Loan Document shall be
automatically released (i) upon termination of the Aggregate Commitments and
payment in full of all Obligations (other than (x) obligations under Secured
Hedge Agreements not yet due and payable, (y) Cash Management Obligations not
yet due and payable and (z) contingent indemnification and expense reimbursement
obligations not yet accrued and payable) and the expiration or termination of
all Letters of Credit, (ii) at the time the property subject to such Lien is
transferred or to be transferred as part of or in connection with any transfer
permitted hereunder or under any other Loan Document to any Person other than
Holdings, the Borrower or any of its Domestic Subsidiaries that are Restricted
Subsidiaries, (iii) subject to Section 10.01, if the release of such Lien is
approved, authorized or ratified in writing by the Required Lenders or (iv) if
the property subject to such Lien is owned by a Guarantor, upon release of such
Guarantor from its obligations under its Guaranty pursuant to clause (c) below;
(b) to release or subordinate any Lien on any property granted to or
held by the Administrative Agent or the Collateral Agent under any Loan Document
to the holder of any Lien on such property that is permitted by Section 7.01(i);
and
(c) that any Guarantor shall be automatically released from its
obligations under the Guaranty if such Person ceases to be a Restricted
Subsidiary as a result of a transaction or designation permitted hereunder;
PROVIDED that no such release shall occur if such Guarantor continues to be a
guarantor in respect of any Junior Financing.
Upon request by the Administrative Agent at any time, the Required
Lenders will confirm in writing the Administrative Agent's authority to release
or subordinate its interest in particular types or items of property, or to
release any Guarantor from its obligations under the Guaranty pursuant to this
Section 9.11. In each case as specified in this Section 9.11, the Administrative
Agent will (and each Lender irrevocably authorizes the Administrative Agent to),
at the Borrower's expense, execute and deliver to the applicable Loan Party such
documents as such Loan Party may reasonably request to evidence the release or
subordination of such item of Collateral from the assignment and security
interest granted under the Collateral Documents, or to evidence the release of
such Guarantor from its obligations under the Guaranty, in each case in
accordance with the terms of the Loan Documents and this Section 9.11.
SECTION 9.12. OTHER AGENTS; ARRANGERS AND MANAGERS. None of the
Lenders or other Persons identified on the facing page or signature pages of
this Agreement as a "syndication agent", "documentation agent", "joint
bookrunner" or "joint lead arranger" shall have any right, power, obligation,
liability, responsibility or duty
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under this Agreement other than those applicable to all Lenders as such. Without
limiting the foregoing, none of the Lenders or other Persons so identified shall
have or be deemed to have any fiduciary relationship with any Lender. Each
Lender acknowledges that it has not relied, and will not rely, on any of the
Lenders or other Persons so identified in deciding to enter into this Agreement
or in taking or not taking action hereunder.
SECTION 9.13. APPOINTMENT OF SUPPLEMENTAL ADMINISTRATIVE AGENTS.
(a) It is the purpose of this Agreement and the other Loan Documents that there
shall be no violation of any Law of any jurisdiction denying or restricting the
right of banking corporations or associations to transact business as agent or
trustee in such jurisdiction. It is recognized that in case of litigation under
this Agreement or any of the other Loan Documents, and in particular in case of
the enforcement of any of the Loan Documents, or in case the Administrative
Agent deems that by reason of any present or future Law of any jurisdiction it
may not exercise any of the rights, powers or remedies granted herein or in any
of the other Loan Documents or take any other action which may be desirable or
necessary in connection therewith, the Administrative Agent is hereby authorized
to appoint an additional individual or institution selected by the
Administrative Agent in its sole discretion as a separate trustee, co-trustee,
administrative agent, collateral agent or administrative co-agent (any such
additional individual or institution being referred to herein individually as a
"SUPPLEMENTAL ADMINISTRATIVE AGENT" and collectively as "SUPPLEMENTAL
ADMINISTRATIVE AGENTS").
(b) In the event that the Administrative Agent appoints a Supplemental
Administrative Agent with respect to any Collateral, (i) each and every right,
power, privilege or duty expressed or intended by this Agreement or any of the
other Loan Documents to be exercised by or vested in or conveyed to the
Administrative Agent with respect to such Collateral shall be exercisable by and
vest in such Supplemental Administrative Agent to the extent, and only to the
extent, necessary to enable such Supplemental Administrative Agent to exercise
such rights, powers and privileges with respect to such Collateral and to
perform such duties with respect to such Collateral, and every covenant and
obligation contained in the Loan Documents and necessary to the exercise or
performance thereof by such Supplemental Administrative Agent shall run to and
be enforceable by either the Administrative Agent or such Supplemental
Administrative Agent, and (ii) the provisions of this Article IX and of Sections
10.04 and 10.05 that refer to the Administrative Agent shall inure to the
benefit of such Supplemental Administrative Agent and all references therein to
the Administrative Agent shall be deemed to be references to the Administrative
Agent and/or such Supplemental Administrative Agent, as the context may require.
(c) Should any instrument in writing from the Borrower, Holdings or
any other Loan Party be required by any Supplemental Administrative Agent so
appointed by the Administrative Agent for more fully and certainly vesting in
and confirming to him or it such rights, powers, privileges and duties, the
Borrower or Holdings, as applicable, shall, or shall cause such Loan Party to,
execute, acknowledge and deliver any and all such instruments promptly upon
request by the Administrative Agent. In case any Supplemental Administrative
Agent, or a successor thereto, shall die, become incapable
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of acting, resign or be removed, all the rights, powers, privileges and duties
of such Supplemental Administrative Agent, to the extent permitted by Law, shall
vest in and be exercised by the Administrative Agent until the appointment of a
new Supplemental Administrative Agent.
ARTICLE X
MISCELLANEOUS
SECTION 10.01. AMENDMENTS, ETC. Except as provided in Section 2.14
with respect to any Incremental Amendment or as otherwise set forth in this
Agreement, no amendment or waiver of any provision of this Agreement or any
other Loan Document, and no consent to any departure by the Borrower or any
other Loan Party therefrom, shall be effective unless in writing signed by the
Required Lenders and the Borrower or the applicable Loan Party, as the case may
be, and each such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given; PROVIDED that, no such
amendment, waiver or consent shall:
(a) extend or increase the Commitment of any Lender without the
written consent of each Lender directly affected thereby (it being understood
that a waiver of any condition precedent set forth in Section 4.02 or the waiver
of any Default, mandatory prepayment or mandatory reduction of the Commitments
shall not constitute an extension or increase of any Commitment of any Lender);
(b) postpone any date scheduled for, or reduce the amount of, any
payment of principal or interest under Section 2.07 or 2.08 without the written
consent of each Lender directly affected thereby, it being understood that the
waiver of (or amendment to the terms of) any mandatory prepayment of the Term
Loans shall not constitute a postponement of any date scheduled for the payment
of principal or interest;
(c) reduce the principal of, or the rate of interest specified herein
on, any Loan or L/C Borrowing, or (subject to clause (iii) of the second proviso
to this Section 10.01) any fees or other amounts payable hereunder or under any
other Loan Document without the written consent of each Lender directly affected
thereby, it being understood that any change to the definition of Total Leverage
Ratio or in the component definitions thereof shall not constitute a reduction
in the rate; PROVIDED that, only the consent of the Required Lenders shall be
necessary to amend the definition of "Default Rate" or to waive any obligation
of the Borrower to pay interest at the Default Rate;
(d) change any provision of this Section 10.01, the definition of
"Required Lenders" or "Pro Rata Share" or Section 2.06(c), 8.03, 8.04 or 2.13
without the written consent of each Lender affected thereby;
(e) other than in a transaction permitted under Section 7.05, release
all or substantially all of the Collateral in any transaction or series of
related transactions, without the written consent of each Lender; or
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(f) amend or modify the provisions of Section 6.15 or, except as
provided in the definition of "Applicable Credit Rating", the definition of
"Collateral Release Period" or "Non-Investment Grade Period", without the
written consent of each Lender; or
(g) other than in connection with a transaction permitted under
Section 7.04 or 7.05, release all or substantially all of the aggregate value
of the Guarantees, without the written consent of each Lender;
and PROVIDED FURTHER that (i) no amendment, waiver or consent shall, unless in
writing and signed by each L/C Issuer in addition to the Lenders required above,
affect the rights or duties of an L/C Issuer under this Agreement or any Letter
of Credit Application relating to any Letter of Credit issued or to be issued by
it; (ii) no amendment, waiver or consent shall, unless in writing and signed by
the Administrative Agent in addition to the Lenders required above, affect the
rights or duties of, or any fees or other amounts payable to, the Administrative
Agent under this Agreement or any other Loan Document; (iii) Section 10.07(h)
may not be amended, waived or otherwise modified without the consent of each
Granting Lender all or any part of whose Loans are being funded by an SPC at the
time of such amendment, waiver or other modification; and (iv) the consent of
Lenders holding more than 50% of any Class of Commitments shall be required with
respect to any amendment that by its terms adversely affects the rights of such
Class in respect of payments hereunder in a manner different than such amendment
affects other Classes. Notwithstanding anything to the contrary herein, no
Defaulting Lender shall have any right to approve or disapprove any amendment,
waiver or consent hereunder, except that the Commitment of such Lender may not
be increased or extended without the consent of such Lender (it being understood
that any Commitments or Loans held or deemed held by any Defaulting Lender shall
be excluded for a vote of the Lenders hereunder requiring any consent of the
Lenders).
Notwithstanding the foregoing, this Agreement may be amended (or
amended and restated) with the written consent of the Required Lenders, the
Administrative Agent and the Borrower (a) to add one or more additional credit
facilities to this Agreement and to permit the extensions of credit from time to
time outstanding thereunder and the accrued interest and fees in respect thereof
to share ratably in the benefits of this Agreement and the other Loan Documents
with the Term Loans and the Revolving Credit Loans and the accrued interest and
fees in respect thereof and (b) to include appropriately the Lenders holding
such credit facilities in any determination of the Required Lenders.
SECTION 10.02. NOTICES AND OTHER COMMUNICATIONS; FACSIMILE COPIES.
(a) GENERAL. 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:
(i) if to Holdings or the Borrower, to it at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention of President and/or
Chief Financial
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Officer (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇), with a copy to The Blackstone Group,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇ ▇▇▇▇▇▇▇
(Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇);
(ii) if to the Administrative Agent, to JPMorgan Chase Bank,
N.A., ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇ ▇.
▇▇▇▇▇ (Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇) (email: ▇▇▇▇.▇.▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇),
with a copy to JPMorgan Chase Bank, N.A., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇);
(iii) if to JPMorgan Chase Bank, N.A. in its capacity as an
L/C Issuer, to JPMorgan Chase Bank, N.A., ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇ ▇. ▇▇▇▇▇ (Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇)
(email: ▇▇▇▇.▇.▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇);
(iv) if to any other L/C Issuer, to it at its address (or
telecopy number) set forth in its Administrative Questionnaire; and
(v) 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. Notices and
other communications to the Lenders and the L/C Issuer hereunder may also be
delivered or furnished by electronic communication (including e-mail and
Internet or intranet websites) pursuant to procedures approved by the
Administrative Agent, PROVIDED that the foregoing shall not apply to notices to
any Lender or the L/C Issuer pursuant to Article II if such Lender or the L/C
Issuer, as applicable, has notified the Administrative Agent that it is
incapable of receiving notices under such Article by electronic communication.
The Administrative Agent or the Borrower may, in its discretion, agree to accept
notices and other communications to it hereunder by electronic communications
pursuant to procedures approved by it; PROVIDED that approval of such procedures
may be limited to particular notices or communications. 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. In no
event shall a voicemail message be effective as a notice, communication or
confirmation hereunder.
(b) EFFECTIVENESS OF FACSIMILE DOCUMENTS AND SIGNATURES. Loan
Documents may be transmitted and/or signed by facsimile. The effectiveness of
any such documents and signatures shall, subject to applicable Law, have the
same force and effect as manually signed originals and shall be binding on all
Loan Parties, the Agents and the Lenders.
(c) RELIANCE BY AGENTS AND LENDERS. The Administrative Agent and the
Lenders shall be entitled to rely and act upon any notices (including telephonic
Committed Loan Notices) purportedly given by or on behalf of the Borrower even
if (i) such notices were not made in a manner specified herein, were incomplete
or were not
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preceded or followed by any other form of notice specified herein, or (ii) the
terms thereof, as understood by the recipient, varied from any confirmation
thereof. The Borrower shall indemnify each Agent-Related Person and each Lender
from all losses, costs, expenses and liabilities resulting from the reliance by
such Person on each notice purportedly given by or on behalf of the Borrower in
the absence of gross negligence or willful misconduct. All telephonic notices to
the Administrative Agent may be recorded by the Administrative Agent, and each
of the parties hereto hereby consents to such recording.
SECTION 10.03. NO WAIVER; CUMULATIVE REMEDIES. No failure by any
Lender or the Administrative Agent to exercise, and no delay by any such Person
in exercising, any right, remedy, power or privilege hereunder or under any
other Loan Document shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege. The rights, remedies, powers and privileges herein provided,
and provided under each other Loan Document, are cumulative and not exclusive of
any rights, remedies, powers and privileges provided by Law.
SECTION 10.04. ATTORNEY COSTS, EXPENSES AND TAXES. The Borrower agrees
(a) if the Closing Date occurs, to pay or reimburse the Administrative Agent,
the Syndication Agent and the Arrangers for all reasonable out-of-pocket costs
and expenses incurred in connection with the preparation, negotiation,
syndication and execution of this Agreement and the other Loan Documents, and
any amendment, waiver, consent or other modification of the provisions hereof
and thereof (whether or not the transactions contemplated thereby are
consummated), and the consummation and administration of the transactions
contemplated hereby and thereby, including all Attorney Costs of Cravath, Swaine
& ▇▇▇▇▇ LLP, and (b) to pay or reimburse the Administrative Agent, the
Syndication Agent, the Arrangers and each Lender for all reasonable
out-of-pocket costs and expenses incurred in connection with the enforcement of
any rights or remedies under this Agreement or the other Loan Documents
(including all such costs and expenses incurred during any legal proceeding,
including any proceeding under any Debtor Relief Law, and including all Attorney
Costs of counsel to the Administrative Agent). The foregoing costs and expenses
shall include all reasonable search, filing, recording and title insurance
charges and fees and stamp, excise and other Taxes related thereto, and other
(reasonable, in the case of Section 10.04(a)) out-of-pocket expenses incurred by
any Agent. The agreements in this Section 10.04 shall survive the termination of
the Aggregate Commitments and repayment of all other Obligations. All amounts
due under this Section 10.04 shall be paid within ten (10) Business Days of
receipt by the Borrower of an invoice relating thereto setting forth such
expenses in reasonable detail. If any Loan Party fails to pay when due any
costs, expenses or other amounts payable by it hereunder or under any Loan
Document, such amount may be paid on behalf of such Loan Party by the
Administrative Agent in its sole discretion.
SECTION 10.05. INDEMNIFICATION BY THE BORROWER. Whether or not the
transactions contemplated hereby are consummated, the Borrower shall indemnify
and hold harmless each Agent-Related Person, each Lender and their respective
Affiliates,
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directors, officers, employees, counsel, agents, trustees, investment advisors
and attorneys-in-fact (collectively the "INDEMNITEES") from and against any and
all liabilities, obligations, losses, damages, penalties, claims, demands,
actions, judgments, suits, costs, expenses and disbursements (including Attorney
Costs) of any kind or nature whatsoever which may at any time be imposed on,
incurred by or asserted against any such Indemnitee in any way relating to or
arising out of or in connection with (a) the execution, delivery, enforcement,
performance or administration of any Loan Document or any other agreement,
letter or instrument delivered in connection with the transactions contemplated
thereby or the consummation of the transactions contemplated thereby, (b) any
Commitment, Loan or Letter of Credit or the use or proposed use of the proceeds
therefrom (including any refusal by an L/C Issuer 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), or (c)
any actual or alleged presence or release of Hazardous Materials on or from any
property currently or formerly owned or operated by the Borrower, any Subsidiary
or any other Loan Party, or any Environmental Liability related in any way to
the Borrower, any Subsidiary or any other Loan Party, or (d) any actual or
prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory (including
any investigation of, preparation for, or defense of any pending or threatened
claim, investigation, litigation or proceeding) and regardless of whether any
Indemnitee is a party thereto (all the foregoing, collectively, the "INDEMNIFIED
LIABILITIES"), in all cases, whether or not caused by or arising, in whole or in
part, out of the negligence of the Indemnitee; PROVIDED that such indemnity
shall not, as to any Indemnitee, be available to the extent that such
liabilities, obligations, losses, damages, penalties, claims, demands, actions,
judgments, suits, costs, expenses or disbursements resulted from the gross
negligence, willful misconduct or bad faith of such Indemnitee or of any
affiliate, director, officer, employee, counsel, agent or attorney-in-fact of
such Indemnitee. No Indemnitee shall be liable for any damages arising from the
use by others of any information or other materials obtained through IntraLinks
or other similar information transmission systems in connection with this
Agreement, nor shall any Indemnitee or any Loan Party have any liability for any
special, punitive, indirect or consequential damages relating to this Agreement
or any other Loan Document or arising out of its activities in connection
herewith or therewith (whether before or after the Closing Date). In the case of
an investigation, litigation or other proceeding to which the indemnity in this
Section 10.05 applies, such indemnity shall be effective whether or not such
investigation, litigation or proceeding is brought by any Loan Party, its
directors, stockholders or creditors or an Indemnitee or any other Person,
whether or not any Indemnitee is otherwise a party thereto and whether or not
any of the transactions contemplated hereunder or under any of the other Loan
Documents is consummated. All amounts due under this Section 10.05 shall be paid
within ten (10) Business Days after demand therefor; PROVIDED, HOWEVER, that
such Indemnitee shall promptly refund such amount to the extent that there is a
final judicial or arbitral determination that such Indemnitee was not entitled
to indemnification or contribution rights with respect to such payment pursuant
to the express terms of this Section 10.05. The agreements in this Section 10.05
shall survive the resignation of the Administrative Agent, the replacement
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of any Lender, the termination of the Aggregate Commitments and the repayment,
satisfaction or discharge of all the other Obligations.
SECTION 10.06. PAYMENTS SET ASIDE. To the extent that any payment by
or on behalf of the Borrower is made to any Agent or any Lender, or any Agent or
any Lender exercises its right of setoff, and such payment or the proceeds of
such setoff or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by such Agent or such Lender in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of
such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such setoff had not occurred, and (b) each Lender
severally agrees to pay to the Administrative Agent upon demand its applicable
share of any amount so recovered from or repaid by any Agent, plus interest
thereon from the date of such demand to the date such payment is made at a rate
per annum equal to the Federal Funds Rate from time to time in effect.
SECTION 10.07. SUCCESSORS AND ASSIGNS. (a) 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, except that
neither Holdings nor the Borrower may assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of each Lender
and no Lender may assign or otherwise transfer any of its rights or obligations
hereunder except (i) to an Eligible Assignee, (ii) by way of participation in
accordance with the provisions of Section 10.07(e), (iii) by way of pledge or
assignment of a security interest subject to the restrictions of Section
10.07(g) or (iv) to an SPC in accordance with the provisions of Section 10.07(h)
(and any other attempted assignment or transfer by any party hereto 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, Participants to the extent
provided in Section 10.07(e) and, to the extent expressly contemplated hereby,
the Indemnitees) any legal or equitable right, remedy or claim under or by
reason of this Agreement.
(b) (i) Subject to the conditions set forth in paragraph (b)(ii)
below, any Lender may assign to one or more assignees ("ASSIGNEES") all or a
portion of its rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans (including for purposes of this Section
10.07(b), participations in L/C Obligations and in Swing Line Loans) at the time
owing to it) with the prior written consent (such consent not to be unreasonably
withheld) of:
(A) the Borrower; PROVIDED that no consent of the Borrower shall
be required for an assignment to a Lender, an Affiliate of a Lender,
an Approved Fund or, if an Event of Default under Section 8.01(a), (f)
or (g) has occurred and is continuing, any Assignee;
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(B) the Administrative Agent; PROVIDED that no consent of the
Administrative Agent shall be required for an assignment (i) of all
or any portion of a Term Loan to a Lender, an Affiliate of a Lender
or an Approved Fund or (ii) to an Agent or an Affiliate of an Agent;
and
(C) each L/C Issuer at the time of such assignment; PROVIDED that
no consent of the L/C Issuers shall be required for any assignment of
a Term Loan or any assignment to an Agent or an Affiliate of an Agent.
(ii) Assignments shall be subject to the following additional
conditions:
(A) 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 or Loans of any Class, the amount
of the Commitment or Loans of the assigning Lender subject to each
such assignment (determined as of the date the Assignment and
Assumption with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $5,000,000 (in the case
of the Revolving Credit Facility), or $1,000,000 (in the case of a
Term Loan) unless each of the Borrower and the Administrative Agent
otherwise consents; PROVIDED that (1) no such consent of the Borrower
shall be required if an Event of Default under Section 8.01(a), (f) or
(g) has occurred and is continuing and (2) such amounts shall be
aggregated in respect of each Lender and its Affiliates or Approved
Funds, if any;
(B) the parties to each assignment shall execute and deliver to
the Administrative Agent an Assignment and Assumption, together with a
processing and recordation fee of $3,500; and
(C) the Assignee, if it shall not be a Lender, shall deliver to
the Administrative Agent an Administrative Questionnaire.
This paragraph (b) shall not prohibit any Lender from assigning all
or a portion of its rights and obligations among separate Facilities on a
non-pro rata basis.
(c) Subject to acceptance and recording thereof by the Administrative
Agent pursuant to Section 10.07(d), from and after the effective date specified
in each Assignment and Assumption, the Eligible Assignee thereunder shall be a
party to this Agreement and, to the extent of the interest assigned by such
Assignment and Assumption, 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 Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption 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 3.01, 3.04, 3.05, 10.04 and 10.05
with respect to facts and circumstances occurring prior to the effective date of
such assignment). Upon request, and the surrender by the assigning Lender of its
Note, the
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Borrower (at its expense) shall execute and deliver a Note to the assignee
Lender. Any assignment or transfer by a Lender of rights or obligations under
this Agreement that does not comply with this clause (c) 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 Section 10.07(e).
(d) The Administrative Agent, acting solely for this purpose as an
agent of the Borrower, shall maintain a copy of each Assignment and Assumption
delivered to it and a register for the recordation of the names and addresses of
the Lenders, and the Commitments of, and principal amounts (and related interest
amounts) of the Loans, L/C Obligations (specifying the Unreimbursed Amounts),
L/C Borrowings and amounts due under Section 2.03 owing to, each Lender pursuant
to the terms hereof from time to time (the "Register"). The entries in the
Register shall be conclusive, absent manifest error, and the Borrower, the
Agents and the Lenders shall 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, any Agent and any Lender, at any
reasonable time and from time to time upon reasonable prior notice.
(e) Any Lender may at any time, without the consent of, or notice to,
the Borrower or the Administrative Agent, sell participations to any Person
(other than a natural person) (each, a "PARTICIPANT") in all or a portion of
such Lender's rights and/or obligations under this Agreement (including all or a
portion of its Commitment and/or the Loans (including such Lender's
participations in L/C Obligations) 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 Agents 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 this Agreement and the
other Loan Documents and to approve any amendment, modification or waiver of any
provision of this Agreement or the other 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, waiver or other modification
described in the first proviso to Section 10.01 that directly affects such
Participant. Subject to Section 10.07(f), the Borrower agrees that each
Participant shall be entitled to the benefits of Sections 3.01, 3.04 and 3.05 to
the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to Section 10.07(c) but shall not be entitled to recover
greater amounts under such Sections than the selling Lender would be entitled to
recover. To the extent permitted by applicable Law, each Participant also shall
be entitled to the benefits of Section 10.09 as though it were a Lender;
PROVIDED that such Participant agrees to be subject to Section 2.13 as though it
were a Lender.
(f) A Participant shall not be entitled to receive any greater payment
under Section 3.01, 3.04 or 3.05 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
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Participant shall not be entitled to the benefits of Section 3.01 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
10.15 as though it were a Lender.
(g) Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement (including under its
Note, if any) to secure obligations of such Lender, including any pledge or
assignment to secure obligations to a Federal Reserve Bank; PROVIDED that no
such pledge or assignment shall release such Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.
(h) Notwithstanding anything to the contrary contained herein, any
Lender (a "GRANTING LENDER") may grant to a special purpose funding vehicle
identified as such in writing from time to time by the Granting Lender to the
Administrative Agent and the Borrower (an "SPC") the option to provide all or
any part of any Loan that such Granting Lender would otherwise be obligated to
make pursuant to this Agreement; PROVIDED that (i) nothing herein shall
constitute a commitment by any SPC to fund any Loan, and (ii) if an SPC elects
not to exercise such option or otherwise fails to make all or any part of such
Loan, the Granting Lender shall be obligated to make such Loan pursuant to the
terms hereof. Each party hereto hereby agrees that (i) neither the grant to any
SPC nor the exercise by any SPC of such option shall increase the costs or
expenses or otherwise increase or change the obligations of the Borrower under
this Agreement (including its obligations under Section 3.01, 3.04 or 3.05),
(ii) no SPC shall be liable for any indemnity or similar payment obligation
under this Agreement for which a Lender would be liable, and (iii) the Granting
Lender shall for all purposes, including the approval of any amendment, waiver
or other modification of any provision of any Loan Document, remain the lender
of record hereunder. The making of a Loan by an SPC hereunder shall utilize the
Commitment of the Granting Lender to the same extent, and as if, such Loan were
made by such Granting Lender. Notwithstanding anything to the contrary contained
herein, any SPC may (i) with notice to, but without prior consent of the
Borrower and the Administrative Agent and with the payment of a processing fee
of $3,500, assign all or any portion of its right to receive payment with
respect to any Loan to the Granting Lender and (ii) disclose on a confidential
basis any non-public information relating to its funding of Loans to any rating
agency, commercial paper dealer or provider of any surety or Guarantee or credit
or liquidity enhancement to such SPC.
(i) Notwithstanding anything to the contrary contained herein, (1) any
Lender may in accordance with applicable Law create a security interest in all
or any portion of the Loans owing to it and the Note, if any, held by it and (2)
any Lender that is a Fund may create a security interest in all or any portion
of the Loans owing to it and the Note, if any, held by it to the trustee for
holders of obligations owed, or securities issued, by such Fund as security for
such obligations or securities; PROVIDED that unless and until such trustee
actually becomes a Lender in compliance with the other provisions of this
Section 10.07, (i) no such pledge shall release the pledging Lender from any of
its obligations under the Loan Documents and (ii) such trustee shall not be
entitled to exercise any of the rights of a Lender under the Loan Documents even
though such
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trustee may have acquired ownership rights with respect to the pledged interest
through foreclosure or otherwise.
(j) Notwithstanding anything to the contrary contained herein, any
L/C Issuer may, upon thirty (30) days' notice to the Borrower and the Lenders,
resign as an L/C Issuer, respectively; PROVIDED that on or prior to the
expiration of such 30-day period with respect to such resignation, the relevant
L/C Issuer shall have identified a successor L/C Issuer reasonably acceptable to
the Borrower willing to accept its appointment as successor L/C Issuer. In the
event of any such resignation of an L/C Issuer, the Borrower shall be entitled
to appoint from among the Lenders willing to accept such appointment a successor
L/C Issuer hereunder; PROVIDED that no failure by the Borrower to appoint any
such successor shall affect the resignation of the relevant L/C Issuer except as
expressly provided above. If an L/C Issuer resigns as an L/C Issuer, it shall
retain all the rights and obligations of an L/C Issuer hereunder with respect to
all Letters of Credit outstanding as of the effective date of its resignation as
an L/C Issuer and all L/C Obligations with respect thereto (including the right
to require the Lenders to make Base Rate Loans or fund risk participations in
Unreimbursed Amounts pursuant to Section 2.03(c)).
SECTION 10.08. CONFIDENTIALITY. Each of the Agents and the Lenders
agrees to maintain the confidentiality of the Information, except that
Information may be disclosed (a) to its Affiliates and its and its Affiliates'
directors, officers, employees, trustees, investment advisors 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 Governmental 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) subject to
an agreement containing provisions substantially the same as those of this
Section 10.08 (or as may otherwise be reasonably acceptable to the Borrower), to
any pledgee referred to in Section 10.07(g), counterparty to a Swap Contract,
Eligible Assignee of or Participant in, or any prospective Eligible Assignee of
or Participant in, any of its rights or obligations under this Agreement; (f)
with the written consent of the Borrower; (g) to the extent such Information
becomes publicly available other than as a result of a breach of this Section
10.08; (h) to any Governmental Authority or examiner (including the National
Association of Insurance Commissioners or any other similar organization)
regulating any Lender; or (i) to any rating agency when required by it (it being
understood that, prior to any such disclosure, such rating agency shall
undertake to preserve the confidentiality of any Information relating to the
Loan Parties received by it from such Lender). In addition, the Agents and the
Lenders may disclose the existence of this Agreement and information about this
Agreement to market data collectors, similar service providers to the lending
industry, and service providers to the Agents and the Lenders in connection with
the administration and management of this Agreement, the other Loan Documents,
the Commitments, and the Credit Extensions. For the purposes of this Section
10.08, "INFORMATION" means all information received from any Loan Party relating
to any Loan Party or its business, other than any such information that is
publicly available to any Agent or any Lender prior to disclosure by any Loan
Party other than as a result of a breach of this Section 10.08; PROVIDED that,
in the case of information
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received from a Loan Party after the date hereof, such information is clearly
identified at the time of delivery as confidential or (ii) is delivered pursuant
to Section 6.01, 6.02 or 6.03 hereof.
SECTION 10.09. SETOFF. In addition to any rights and remedies of the
Lenders provided by Law, upon the occurrence and during the continuance of any
Event of Default, each Lender and its Affiliates is authorized at any time and
from time to time, without prior notice to the Borrower or any other Loan Party,
any such notice being waived by the Borrower (on its own behalf and on behalf of
each Loan Party and its Subsidiaries) to the fullest extent permitted by
applicable Law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held by, and other
Indebtedness at any time owing by, such Lender and its Affiliates to or for the
credit or the account of the respective Loan Parties and their Subsidiaries
against any and all Obligations owing to such Lender and its Affiliates
hereunder or under any other Loan Document, now or hereafter existing,
irrespective of whether or not such Agent or such Lender or Affiliate shall have
made demand under this Agreement or any other Loan Document and although such
Obligations may be contingent or unmatured. Each Lender agrees promptly to
notify the Borrower and the Administrative Agent after any such set off and
application made by such Lender; PROVIDED, that the failure to give such notice
shall not affect the validity of such setoff and application. The rights of the
Administrative Agent and each Lender under this Section 10.09 are in addition to
other rights and remedies (including other rights of setoff) that the
Administrative Agent and such Lender may have. Notwithstanding anything herein
or in any other Loan Document to the contrary, in no event shall the assets of
any Foreign Subsidiary that is not a Loan Party constitute collateral security
for payment of the Obligations of the Borrower or any Domestic Subsidiary, it
being understood that (a) the Equity Interests of any Foreign Subsidiary that is
not a Loan Party do not constitute such an asset and (b) the provisions hereof
shall not limit, reduce or otherwise diminish in any respect the Borrower's
obligations to make any mandatory prepayment pursuant to Section 2.05(b)(ii).
SECTION 10.10. INTEREST RATE LIMITATION. Notwithstanding anything to
the contrary contained in any Loan Document, the interest paid or agreed to be
paid under the Loan Documents shall not exceed the maximum rate of non-usurious
interest permitted by applicable Law (the "MAXIMUM RATE"). If any Agent or any
Lender shall receive interest in an amount that exceeds the Maximum Rate, the
excess interest shall be applied to the principal of the Loans or, if it exceeds
such unpaid principal, refunded to the Borrower. In determining whether the
interest contracted for, charged, or received by an Agent or a Lender exceeds
the Maximum Rate, such Person may, to the extent permitted by applicable Law,
(a) characterize any payment that is not principal as an expense, fee, or
premium rather than 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 contemplated term of the
Obligations hereunder.
SECTION 10.11. COUNTERPARTS. This Agreement and each other Loan
Document may be executed in one or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
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Delivery by telecopier of an executed counterpart of a signature page to this
Agreement and each other Loan Document shall be effective as delivery of an
original executed counterpart of this Agreement and such other Loan Document.
The Agents may also require that any such documents and signatures delivered by
telecopier be confirmed by a manually signed original thereof; PROVIDED that the
failure to request or deliver the same shall not limit the effectiveness of any
document or signature delivered by telecopier.
SECTION 10.12. INTEGRATION. This Agreement, together with the other
Loan Documents, comprises the complete and integrated agreement of the parties
on the subject matter hereof and thereof and supersedes all prior agreements,
written or oral, on such subject matter. In the event of any conflict between
the provisions of this Agreement and those of any other Loan Document, the
provisions of this Agreement shall control; PROVIDED that the inclusion of
supplemental rights or remedies in favor of the Agents or the Lenders in any
other Loan Document shall not be deemed a conflict with this Agreement. Each
Loan Document was drafted with the joint participation of the respective parties
thereto and shall be construed neither against nor in favor of any party, but
rather in accordance with the fair meaning thereof.
SECTION 10.13. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made hereunder and in any other Loan Document or
other document delivered pursuant hereto or thereto or in connection herewith or
therewith shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by each Agent
and each Lender, regardless of any investigation made by any Agent or any Lender
or on their behalf and notwithstanding that any Agent or any Lender may have had
notice or knowledge of any Default at the time of any Credit Extension, and
shall continue in full force and effect as long as any Loan or any other
Obligation hereunder shall remain unpaid or unsatisfied or any Letter of Credit
shall remain outstanding.
SECTION 10.14. SEVERABILITY. If any provision of this Agreement or the
other Loan Documents is held to be illegal, invalid or unenforceable, the
legality, validity and enforceability of the remaining provisions of this
Agreement and the other Loan Documents shall not be affected or impaired
thereby. The invalidity of a provision in a particular jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
SECTION 10.15. TAX FORMS. (a) (i) Each Lender and Agent that is not a
"United States person" within the meaning of Section 7701(a)(30) of the Code
(each, a "FOREIGN LENDER") shall deliver to the Borrower and the Administrative
Agent, on or prior to the date which is ten (10) Business Days after the Closing
Date (or upon accepting an assignment of an interest herein), two duly signed,
properly completed copies of either IRS Form W-8BEN or any successor thereto
(relating to such Foreign Lender and entitling it to a complete exemption from,
or reduction of, United States withholding Tax on all payments to be made to
such Foreign Lender by the Borrower or any other Loan Party pursuant to this
Agreement or
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any other Loan Document) or such other evidence reasonably satisfactory to the
Borrower and the Administrative Agent that such Foreign Lender is entitled to an
exemption from, or reduction of, United States withholding Tax, including any
exemption pursuant to Section 871(h) or 881(c) of the Code, and in the case of a
Foreign Lender claiming such an exemption under Section 881(c) of the Code, a
certificate that establishes in writing to the Borrower and the Administrative
Agent that such Foreign Lender is not (i) a "bank" as defined in Section
881(c)(3)(A) of the Code, (ii) a 10-percent stockholder within the meaning of
Section 871(h)(3)(B) of the Code, or (iii) a controlled foreign corporation
related to the Borrower with the meaning of Section 864(d) of the Code.
Thereafter and from time to time, each such Foreign Lender shall (A) promptly
submit to the Borrower and the Administrative Agent such additional duly
completed and signed copies of one or more of such forms or certificates (or
such successor forms or certificates as shall be adopted from time to time by
the relevant United States taxing authorities) as may then be available under
then current United States Laws and regulations to avoid, or such evidence as is
reasonably satisfactory to the Borrower and the Administrative Agent of any
available exemption from, or reduction of, United States withholding Taxes in
respect of all payments to be made to such Foreign Lender by the Borrower or
other Loan Party pursuant to this Agreement, or any other Loan Document, in each
case, (1) on or before the date that any such form, certificate or other
evidence expires or becomes obsolete, (2) after the occurrence of any event
requiring a change in the most recent form, certificate or evidence previously
delivered by it to the Borrower and the Administrative Agent and (3) from time
to time thereafter if reasonably requested by the Borrower or the Administrative
Agent, and (B) promptly notify the Borrower and the Administrative Agent of any
change in circumstances which would modify or render invalid any claimed
exemption or reduction.
(ii) Each Foreign Lender, to the extent it does not act or ceases to
act for its own account with respect to any portion of any sums paid or
payable to such Foreign Lender under any of the Loan Documents (for
example, in the case of a typical participation by such Foreign Lender),
shall deliver to the Borrower and the Administrative Agent on the date when
such Foreign Lender ceases to act for its own account with respect to any
portion of any such sums paid or payable, and at such other times as may be
necessary in the determination of the Borrower or the Administrative Agent
(in either case, in the reasonable exercise of its discretion), (A) two
duly signed completed copies of the forms or statements required to be
provided by such Foreign Lender as set forth above, to establish the
portion of any such sums paid or payable with respect to which such Foreign
Lender acts for its own account that is not subject to United States
withholding Tax, and (B) two duly signed completed copies of IRS Form
W-8IMY (or any successor thereto), together with any information such
Foreign Lender chooses to transmit with such form, and any other
certificate or statement of exemption required under the Code, to establish
that such Foreign Lender is not acting for its own account with respect to
a portion of any such sums payable to such Foreign Lender.
(iii) The Borrower shall not be required to pay any additional amount
or any indemnity payment under Section 3.01 to (A) any Foreign Lender if
such
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Foreign Lender shall have failed to satisfy the foregoing provisions of
this Section 10.15(a), or (B) any U.S. Lender if such U.S. Lender shall
have failed to satisfy the provisions of Section 10.15(b); PROVIDED that
(i) if such Lender shall have satisfied the requirement of this Section
10.15(a) or Section 10.15(b), as applicable, on the date such Lender became
a Lender or ceased to act for its own account with respect to any payment
under any of the Loan Documents, nothing in this Section 10.15(a) or
Section 10.15(b) shall relieve the Borrower of its obligation to pay any
amounts pursuant to Section 3.01 in the event that, as a result of any
change in any applicable Law, treaty or governmental rule, regulation or
order, or any change in the interpretation, administration or application
thereof, such Lender is no longer properly entitled to deliver forms,
certificates or other evidence at a subsequent date establishing the fact
that such Lender or other Person for the account of which such Lender
receives any sums payable under any of the Loan Documents is not subject to
withholding or is subject to withholding at a reduced rate and (ii) nothing
in this Section 10.15(a) shall relieve the Borrower of its obligation to
pay any amounts pursuant to Section 3.01 in the event that the requirements
of Section 10.15(a)(ii) have not been satisfied if, but only to the extent
that and only for so long as, such Borrower is entitled, under applicable
Law, to rely on any applicable forms and statements provided, as required
under Section 10.15(a)(i), by the Foreign Lender that does not act or has
ceased to act for its own account under any of the Loan Documents,
including in the case of a participation.
(iv) The Administrative Agent may deduct and withhold any Taxes
required by any Laws to be deducted and withheld from any payment under
any of the Loan Documents.
(b) Each Lender and Agent that is a "United States person" within the
meaning of Section 7701(a)(30) of the Code (each, a "U.S. LENDER") shall deliver
to the Administrative Agent and the Borrower two duly signed, properly completed
copies of IRS Form W-9 on or prior to the Closing Date (or on or prior to the
date it becomes a party to this Agreement), certifying that such U.S. Lender is
entitled to an exemption from United States backup withholding Tax, or any
successor form. If such U.S. Lender fails to deliver such forms, then the
Administrative Agent may withhold from any payment to such U.S. Lender an amount
equivalent to the applicable backup withholding Tax imposed by the Code.
SECTION 10.16. GOVERNING LAW. (a) THIS AGREEMENT AND EACH OTHER LOAN
DOCUMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK.
(b) ANY LEGAL ACTION OR PROCEEDING ARISING UNDER ANY LOAN DOCUMENT OR
IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE
PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE
TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR
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HEREAFTER ARISING, MAY BE BROUGHT IN ▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ SITTING
IN NEW YORK CITY OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF SUCH
STATE, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER, HOLDINGS,
EACH AGENT AND EACH LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
TO THE EXCLUSIVE JURISDICTION OF THOSE COURTS. THE BORROWER, HOLDINGS, EACH
AGENT AND EACH LENDER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION
TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT RELATED THERETO.
SECTION 10.17. WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY TO THIS
AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR
ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED
THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER
FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND
CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED
BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN
ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 10.17 WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT
TO TRIAL BY JURY.
SECTION 10.18. BINDING EFFECT. This Agreement shall become effective
when it shall have been executed by the Borrower and Holdings and the
Administrative Agent shall have been notified by each Lender and L/C Issuer that
each such Lender and L/C Issuer has executed it and thereafter shall be binding
upon and inure to the benefit of the Borrower, each Agent and each Lender and
their respective successors and assigns, except that the Borrower shall not have
the right to assign its rights hereunder or any interest herein without the
prior written consent of the Lenders except as permitted by Section 7.04.
SECTION 10.19. LENDER ACTION. Each Lender agrees that it shall not
take or institute any actions or proceedings, judicial or otherwise, for any
right or remedy against any Loan Party or any other obligor under any of the
Loan Documents or the Secured Hedge Agreements (including the exercise of any
right of setoff, rights on account of any banker's lien or similar claim or
other rights of self-help), or institute any actions or proceedings, or
otherwise commence any remedial procedures, with respect to any Collateral or
any other property of any such Loan Party, without the prior written consent of
the Administrative Agent. The provision of this Section 10.19 are for the sole
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benefit of the Lenders and shall not afford any right to, or constitute a
defense available to, any Loan Party.
SECTION 10.20. USA PATRIOT ACT. Each Lender hereby notifies the
Borrower that pursuant to the requirements of the USA Patriot Act (Title III of
Pub. L. 107-56 (signed into law October 26, 2001)) (the "ACT"), it is required
to obtain, verify and record information that identifies the Borrower, which
information includes the name and address of the Borrower and other information
that will allow such Lender to identify the Borrower in accordance with the Act.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
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IN WITNESS WHEREOF, the parties hereto have caused Agreement to be
duly executed as of the date first above written.
UICI,
by /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
_________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: Executive Vice President and General
Counsel
HEALTHMARKETS, LLC,
by UICI
by /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
_________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: Executive Vice President and
General Counsel
JPMORGAN CHASE BANK, N.A., as
Administrative Agent, L/C
Issuer and a Lender,
by /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
_________________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING
INC., as Syndication Agent,
by /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
_________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
▇▇▇▇▇▇▇ SACHS CREDIT PARTNERS
L.P., as Documentation Agent,
by /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: