EXIBIT 4.2
SENIOR SUBORDINATED CREDIT AGREEMENT
dated as of
September 30, 1999
among
BIO-RAD LABORATORIES, INC.,
as Company,
THE LENDERS named herein
and
BANC ONE CAPITAL MARKETS, INC., as Agent
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS ........................................ 1
1.1 Certain Defined Terms............................... 1
1.2 Accounting Terms.................................... 27
1.3 Other Definitional Provisions; Anniversaries........ 28
SECTION 2. AMOUNT AND TERMS OF LOAN COMMITMENT AND
LOANS; NOTES ....................................... 28
2.1 Bridge Loan and Bridge Note......................... 28
2.2 Rollover Bridge Loan and Rollover Bridge Note....... 30
2.3 Interest on the Notes .............................. 31
2.4 Fees................................................ 33
2.5 Prepayments and Payments............................ 33
2.6 Use of Proceeds..................................... 36
2.7 Interest Rate Unascertainable, Increased Costs,
Illegality......................................... 37
2.8 Funding Losses...................................... 38
2.9 Increased Capital................................... 39
2.10 Taxes............................................... 40
SECTION 3. CONDITIONS.......................................... 42
3.1 Conditions to Bridge Loan........................... 42
3.2 Conditions to Rollover Bridge Loan.................. 47
SECTION 4. REPRESENTATIONS AND WARRANTIES
OF THE COMPANY...................................... 48
4.1 Existence and Standing.............................. 49
4.2 Authorization and Validity.......................... 49
4.3 No Conflict; Government Consent..................... 49
4.4 Financial Statements................................ 50
4.5 Material Adverse Change............................. 51
4.6 Taxes............................................... 51
4.7 Litigation and Contingent Obligations............... 51
4.8 Subsidiaries........................................ 51
4.9 ERISA............................................... 52
4.10 Accuracy of Information............................. 52
4.11 Regulation U........................................ 52
4.12 Material Agreements................................. 52
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4.13 Compliance With Laws................................ 52
4.14 Ownership of Properties............................. 53
4.15 Plan Assets; Prohibited Transactions................ 53
4.16 Environmental Matters............................... 53
4.17 Investment Company Act.............................. 54
4.18 Public Utility Holding Company Act.................. 54
4.19 Year 2000........................................... 54
4.20 Post-Retirement Benefits............................ 54
4.21 Insurance........................................... 54
4.22 The PSD Acquisition.................................. 55
4.23 Solvency............................................. 56
SECTION 4A. REPRESENTATIONS AND WARRANTIES
OF THE LENDERS..................................... 56
4A.1 Accredited Investor................................. 56
4A.2 Knowledge and Experience............................ 57
4A.3 Source of Funds..................................... 57
SECTION 5. AFFIRMATIVE COVENANTS............................... 57
5.1 Financial Reporting................................. 57
5.2 Use of Proceeds..................................... 59
5.3 Notice of Default................................... 59
5.4 Conduct of Business................................. 59
5.5 Taxes............................................... 59
5.6 Insurance........................................... 60
5.7 Compliance with Laws................................ 60
5.8 Maintenance of Properties........................... 60
5.9 Inspection.......................................... 60
5.10 Year 2000........................................... 61
5.11 Additional Guarantors............................... 61
5.12 Exchange of Rollover Bridge Notes................... 62
5.13 Permanent Securities................................ 62
5.14 Lenders Meeting..................................... 63
5.15 Note Documents...................................... 63
5.16 Syndication......................................... 64
SECTION 6. NEGATIVE COVENANTS.................................. 65
6.1 Dividends........................................... 65
6.2 Indebtedness........................................ 65
6.3 Merger.............................................. 66
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6.4 Sale of Assets...................................... 67
6.5 Investments and Acquisitions........................ 67
6.6 Liens............................................... 68
6.7 Capital Expenditures................................ 70
6.8 Limitation on Dividend and Other Payment
Restrictions Affecting Subsidiaries............... 70
6.9 Affiliates.......................................... 72
6.10 Unfunded Liabilities................................ 72
6.11 Limitation on Modifications of Certain Documents.... 72
6.12 Sale and Leaseback Transactions..................... 73
6.13 Contingent Obligations.............................. 73
6.14 Financial Contracts................................. 73
6.15 Refinancing of the Loans in Part.................... 73
6.16 Senior Subordinated Indebtedness.................... 73
6.17 Leverage Ratio...................................... 74
SECTION 7. EVENTS OF DEFAULT................................... 74
7.1 Events of Default................................... 74
7.2 Acceleration........................................ 77
SECTION 8. SUBORDINATION....................................... 78
8.1 Obligations Subordinated to Senior Debt of the
Company........................................... 78
8.2 Priority and Payment Over of Proceeds in Certain
Events............................................ 78
8.3 Payments May Be Paid Prior to Dissolution........... 81
8.4 Rights of Holders of Senior Debt of the Company
Not To Be Impaired................................ 81
8.5 Subrogation......................................... 82
8.6 Obligations of the Company Unconditional............ 83
8.7 Lenders Authorize Agent To Effectuate Subordination. 83
SECTION 9. THE AGENT........................................... 84
9.1 Appointment......................................... 84
9.2 Delegation of Duties................................ 84
9.3 Exculpatory Provisions.............................. 85
9.4 Reliance by Agent................................... 85
9.5 Notice of Default................................... 86
9.6 Non-Reliance on Agent and Other Lenders............. 86
9.7 Indemnification..................................... 87
9.8 Agent in Its Individual Capacity.................... 87
9.9 Resignation of the Agent; Successor Agent........... 88
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SECTION 10. GUARANTEE........................................... 88
10.1 Unconditional Guarantee............................. 88
10.2 Subordination of Guarantee.......................... 89
10.3 Severability........................................ 89
10.4 Release of a Guarantor.............................. 89
10.5 Limitation of Guarantor's Liability................. 90
10.6 Guarantors May Consolidate, etc., on Certain Terms.. 90
10.7 Contribution........................................ 91
10.8 Waiver of Subrogation............................... 92
10.9 Evidence of Guarantee............................... 92
10.10 Waiver of Stay, Extension or Usury Laws............. 92
SECTION 11. SUBORDINATION OF GUARANTEE OBLIGATIONS.............. 93
11.1 Guarantee Obligations Subordinated to Guarantor
Senior Debt....................................... 93
11.2 Priority and Payment Over of Proceeds in Certain
Events............................................ 93
11.3 Payments May Be Paid Prior to Dissolution........... 96
11.4 Rights of Holders of Guarantor Senior Debt Not To
Be Impaired....................................... 96
11.5 Subrogation......................................... 97
11.6 Obligations of the Guarantors Unconditional......... 98
11.7 Lenders Authorize Agent To Effectuate Subordination. 98
SECTION 12. WARRANTS............................................ 99
SECTION 13. MISCELLANEOUS....................................... 101
13.1 Participations in and Assignments of Loans and
Notes............................................. 101
13.2 Expenses............................................ 102
13.3 Indemnity........................................... 103
13.4 Setoff.............................................. 104
13.5 Amendments and Waivers.............................. 104
13.6 Independence of Covenants........................... 105
13.7 Entirety............................................ 105
13.8 Notices............................................. 106
13.9 Survival of Warranties and Certain Agreements....... 106
13.10 Failure or Indulgence Not Waiver; Remedies
Cumulative........................................ 106
13.11 Severability........................................ 107
13.12 Headings............................................ 107
13.13 Applicable Law...................................... 107
13.14 Successors and Assigns; Subsequent Holders of Notes. 107
13.15 Counterparts; Effectiveness......................... 107
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13.16 Consent to Jurisdiction; Venue; Waiver of Jury
Trial............................................. 108
13.17 Payments Pro Rata................................... 109
13.18 Waiver of Stay, Extension or Usury Laws............. 109
13.19 Confidentiality..................................... 110
13.20 Register............................................ 110
ANNEX I Lending Offices
SCHEDULES
Schedule 4.4 Pro Forma Financial Statements
Schedule 4.7 Litigation
Schedule 4.8 Subsidiaries
Schedule 4.21 Insurance
Schedule 6.2 Indebtedness
Schedule 6.5 Investments
Schedule 6.6 Liens
EXHIBITS
I FORM OF BRIDGE NOTE
II FORM OF ROLLOVER BRIDGE NOTE
III FORM OF COMPLIANCE CERTIFICATE
IV-A FORM OF NOTICE OF BORROWING
IV-B FORM OF ROLLOVER NOTICE
V FORM OF OPINION OF ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ - COUNSEL FOR THE
COMPANY
VI FORM OF NOTATION ON NOTE RELATING TO GUARANTEES
VII FORM OF ESCROW AGREEMENT
VIII FORM OF WARRANT AGREEMENT
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This Senior Subordinated Credit Agreement is dated as of
September 30, 1999, and entered into by and between Bio-Rad Laboratories,
Inc., a Delaware corporation (the "Company"), the Lenders named on the
signature pages hereto (the "Lenders"), and Banc One Capital Markets, Inc.
("BOCM"), as agent for the Lenders (in such capacity, the "Agent").
RECITALS
WHEREAS, the Company desires that the Lenders extend a
senior subordinated credit facility to the Company in connection with
the PSD Acquisition (as defined herein);
NOW, THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, the parties
hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Certain Defined Terms. The following terms used in this
Agreement shall have the followingb meanings:
"Acquired Business" is defined in the definition of "PSD
Acquisition."
"Acquired Indebtedness" means Indebtedness of a Person
existing at the time such Person becomes a Subsidiary or is merged or
consolidated into the Company or one of its Subsidiaries.
"Acquisition" means any transaction, or any series of
related transactions, consummated on or after the date of this
Agreement, by which the Company or any of its Subsidiaries (i)
acquires any going business or all or substantially all of the assets
of any firm, corporation or limited liability company, or division
thereof, whether through purchase of assets, merger or otherwise or
(ii) directly or indirectly acquires (in one transaction or as the
most recent transaction in a series of transactions) at least a
majority (in number of votes) of the securities of a corporation which
have ordinary voting power for the election of directors (other than
securities having such power only by reason of the happening of a
contingency) or a majority (by percentage of voting power) of the
outstanding ownership interests of a partnership or limited liability
company.
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"Adjusted Net Assets" shall have the meaning provided in Section
10.7.
"Affiliate" of any Person means any other Person directly or
indirectly controlling, controlled by or under common control with
such Person. A Person shall be deemed to control another Person if
the controlling Person owns 20% or more of any class of voting
securities (or other ownership interests) of the controlled Person or
possesses, directly or indirectly, the power to direct or cause the
direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise. Any
member of the ▇▇▇▇▇▇▇▇ Group shall be deemed to be an Affiliate of the
Company.
"Agent" has the meaning ascribed to such term in the
introduction to this Agreement.
"Agreement" means this Senior Subordinated Credit Agreement
dated as of September 30, 1999, as it may be amended, supplemented,
restated or otherwise modified from time to time in accordance with
the terms hereof.
"Agreement Accounting Principles" means generally accepted
accounting principles as in effect from time to time.
"Applicable Margin" means, with respect to the Bridge Loan,
6% for the period from and including the Closing Date and to but
excluding the three month anniversary of the Closing Date, and for
each subsequent Interest Period, the Applicable Margin in effect for
the immediately preceding Interest Period plus 0.50%.
"Applicable Treasury Rate" means, with respect to the date
to which such Applicable Treasury Rate relates, the average of the
annual yield rate of the three most actively traded U.S. Treasury
securities having a remaining duration to maturity closest to maturity
of the Rollover Bridge Loan as such rate is published under "Treasury
Constant Maturities" in Federal Reserve Statistical Release H.15(519).
"Asset Sale" means, with respect to any Person, the sale,
conveyance, disposition or other transfer by such Person of any of its
assets (including by way of a sale-leaseback transaction and including
the sale or other transfer of any of the Equity Interests of any
Subsidiary of such Person), other than the sale of inventory in the
ordinary course of business and of obsolete or worn-out property in
the ordinary course of business, the exchange or trade-in of equipment
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and other assets for replacement assets and the granting of a
nonexclusive license. "Asset Sale" shall not include (i) any casualty
to or condemnation of Property to which Section 6.6 of the Senior
Secured Credit Agreement applies, whether the proceeds thereof are
Excluded Proceeds (as defined in the Senior Secured Credit Agreement)
or otherwise, or (ii) the sale, conveyance, disposition or other
transfer by a Foreign Subsidiary of any of its assets to the extent
that the Net Cash Proceeds thereof are invested in assets or Property
(other than Cash Equivalent Investments) in any Foreign Subsidiary's
business within twelve months after such sale, conveyance disposition
or other transfer.
"Bankruptcy Law" means Title 11 of the United States Code
entitled "Bankruptcy", as now and hereafter in effect, or any
successor statute or any other United States federal, state or local
law or the law of any other jurisdiction relating to bankruptcy,
insolvency, winding up, liquidation, reorganization or relief of
debtors, whether in effect on the date hereof or hereafter.
"Board of Directors" means, as to any Person, the board of
directors of such Person or any duly authorized committee of that
Board.
"Board Resolution" means, with respect to any Person, a copy
of a resolution certified by the Secretary or an Assistant Secretary
of such Person to have been duly adopted by the Board of Directors of
such Person and to be in full force and effect on the date of such
certification.
"BOCM" means Banc One Capital Markets, Inc.
"Bridge Loan" means, collectively, the loans made by the
Lenders pursuant to Section 2.1(a) and shall include any Junior
Securities and PIK Interest Amount.
"Bridge Loan Commitment" means the commitment of the Lenders
to make the Bridge Loan as set forth in Section 2.1(a).
"Bridge Notes" has the meaning ascribed to such term in
Section 2.1(d).
"Bridge Payment Date" has the meaning ascribed to such term
in Section 2.3(b).
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"Business Day" means any day excluding Saturday, Sunday and
any day which is a legal holiday under the laws of New York and/or
Illinois or is a day on which banking institutions therein located are
authorized or required by law or other governmental action to close.
"Capital Expenditures" means, without duplication, any
expenditures for any purchase or other acquisition of any asset which
would be classified as a fixed or capital asset on a consolidated
balance sheet of the Company and its Subsidiaries prepared in
accordance with Agreement Accounting Principles, excluding (i) the
trade-in value of equipment or other assets exchanged for replacement
assets, (ii) expenditures of insurance proceeds to rebuild or replace
any asset after a casualty loss, (iii) the PSD Acquisition and (iv)
Permitted Acquisitions.
"Capitalized Lease" of a Person means any lease of Property
by such Person as lessee which would be capitalized on a balance sheet
of such Person prepared in accordance with Agreement Accounting
Principles.
"Capitalized Lease Obligations" of a Person means the amount
of the obligations of such Person under Capitalized Leases which would
be shown as a liability on a balance sheet of such Person prepared in
accordance with Agreement Accounting Principles.
"Cash Equivalent Investments" means (i) direct obligations
issued or fully guaranteed by the United States of America or issued
by any agency thereof and backed by the full faith and credit of the
United States, in each case maturing within one year from the date of
acquisition thereof, (ii) commercial paper rated A-1 or better by S&P
or P-1 or better by ▇▇▇▇▇'▇, (iii) demand deposit accounts maintained
in the ordinary course of business, (iv) certificates of deposit
issued by and time deposits with commercial banks (whether domestic or
foreign) having capital and surplus in excess of $100,000,000 and (v)
mutual funds that invest solely in one or more of the types of
investments described in clauses (i)-(iv) above; provided in each case
that the same provides for payment of both principal and interest (and
not principal alone or interest alone) and is not subject to any
contingency regarding the payment of principal or interest.
"Change in Control" means:
(i) any merger or consolidation of the Company with or into
any Person or any sale, transfer or other conveyance, whether direct
or indirect, of all or substantially all of the Company's assets, on a
4
consolidated basis, in one transaction or a series of related
transactions, if, immediately after giving effect to such transac-
tion(s), either (x) any "person" or "group" (other than a member of
the ▇▇▇▇▇▇▇▇ Group) is or becomes the "beneficial owner," directly or
indirectly, of more than 40% of the Voting Equity Interests of the
transferee(s) or surviving entity or entities, and the ▇▇▇▇▇▇▇▇ Group
shall cease to own beneficially at least a greater percentage of the
Voting Equity Interests of the transferee(s) or surviving entity or
entities or (y) the ▇▇▇▇▇▇▇▇ Group shall cease to own beneficially (A)
30% of the Voting Equity Interests of such transferee(s) or surviving
entity or entities or (B) a greater percentage of the Voting Equity
Interests of such transferee(s) or surviving entity or entities than
any other person or group, whichever is less;
(ii) any "person" or "group" (other than a member of the
▇▇▇▇▇▇▇▇ Group) is or becomes the "beneficial owner," directly or
indirectly, of more than 40% of the Company's Voting Equity Interests,
and the ▇▇▇▇▇▇▇▇ Group shall cease to own beneficially at least a
greater percentage of the Company's Voting Equity Interests;
(iii) the Continuing Directors cease for any reason to
constitute a majority of the Company's Board of Directors then in
office; or
(iv) the Company adopts a plan of liquidation or
dissolution.
"Change of Control Offer" has the meaning ascribed to such
term in Section 2.5(d)(i).
"Closing Date" means the date on or before November 1, 1999
on which the initial Bridge Loan is made and the conditions set forth
in Section 3.1 are satisfied or waived in accordance with Section
13.5.
"Commitment Letter" means the letter agreement dated June
16, 1999 between the Company and FCCC, as amended from time to time,
pursuant to which FCCC committed to provide the Bridge Loan to the
Company.
"Common Stock" of any Person means any and all shares,
interests or other participations in, and other equivalents (however
designated and whether voting or non-voting) of, such Person's common
stock, whether outstanding on the Closing Date or issued after the
Closing Date, and includes, without limitation, all series and classes
of such common stock.
5
"Company" has the meaning ascribed to such term in the
introduction to this Agreement.
"Consolidated EBITDA" means, with reference to any period,
Consolidated Net Income for such period plus, to the extent deducted
from revenues in determining Consolidated Net Income (without
duplication), (i) Consolidated Interest Expense and all non-cash
interest expense, (ii) expense for income taxes paid or accrued, (iii)
depreciation, (iv) amortization, (v) extraordinary losses incurred
other than in the ordinary course of business and losses from
discontinued operations, (vi) any extraordinary, unusual or non-
recurring non-cash expenses or non-cash losses, and (vii) non-
recurring cash charges, including any capitalized non-recurring cash
charges, taken on or prior to March 31, 2000 resulting from severance,
integration and other adjustments made as a result of the PSD
Acquisition (provided that the amounts referred to in this clause
(vii) shall not, in the aggregate, exceed $25,000,000), and minus, to
the extent included in Consolidated Net Income, extraordinary gains
and gains from discontinued operations, all net of tax, realized other
than in the ordinary course of business, all calculated for the
Company and its Subsidiaries on a consolidated basis for such period.
"Consolidated Funded Indebtedness" means at any time,
without duplication, the aggregate dollar amount of (i) Indebtedness
(other than Rate Management Obligations and similar obligations under
other Financial Contracts) of the Company and its Subsidiaries which
has actually been funded and is outstanding at such time, whether or
not such amount is due and payable at such time, plus (ii) undrawn
amounts available under standby letters of credit, all calculated on a
consolidated basis as of such time.
"Consolidated Interest Expense" means, with reference to any
period, the cash interest expense of the Company and its Subsidiaries
calculated on a consolidated basis for such period.
"Consolidated Net Income" means, with reference to any
period, the net income (or loss) of the Company and its Subsidiaries
calculated on a consolidated basis for such period.
"Contingent Obligation" of a Person means any agreement,
undertaking or arrangement by which such Person assumes, guarantees,
endorses, contingently agrees to purchase or provide funds for the
payment of, or otherwise becomes or is contingently liable upon, the
Indebtedness of any other Person, or agrees to maintain the net worth
or working capital or other financial condition of any other Person,
6
or otherwise assures any creditor of such other Person against loss,
including, without limitation, any comfort letter or material
take-or-pay contract.
"Continuing Directors" means, during any period of 12
consecutive months after the Closing Date, individuals who at the
beginning of any such 12-month period constituted the Company's Board
of Directors (together with any new directors whose election by such
Board of Directors or whose nomination for election by the Company's
shareholders was approved by a vote of a majority of the directors
then still in office who were either directors at the beginning of
such period or whose election or nomination for election was
previously so approved, including new directors designated in or
provided for in an agreement regarding the merger, consolidation or
sale, transfer or other conveyance, of all or substantially all of the
assets of the Company, if such agreement was approved by a vote of
such majority of directors).
"Controlled Group" means all members of a controlled group
of corporations or other business entities and all trades or
businesses (whether or not incorporated) under common control which,
together with the Company or any of its Subsidiaries, are treated as a
single employer under Section 414 of the Internal Revenue Code.
"Default" means an event or condition the occurrence of
which is, or with the lapse of time or the giving of notice or both
would be, an Event of Default.
"Dollars" or the sign "$" means the lawful money of the
United States of America.
"Domestic Lending Office" shall mean, as to any Lender, the
office of such Lender designated as such on Annex I, or such other
office designated by such Lender from time to time by written notice
to the Agent and the Company.
"Domestic Subsidiary" means a Subsidiary organized under the
laws of the United States of America, any State thereof or the
District of Columbia.
"Eligible Assignee" means (A) (i) a commercial bank
organized under the laws of the United States of America or any state
thereof; (ii) a savings and loan association or savings bank organized
under the laws of the United States or any state thereof; (iii) a
commercial bank organized under the laws of any other country or a
political subdivision thereof; provided that (x) such bank is acting
through a branch or agency located in the United States or (y) such
7
bank is organized under the laws of a country that is a member of the
Organization for Economic Cooperation and Development or a political
subdivision of such country; and (iv) any other entity which is an
"accredited investor" (as defined in Regulation D under the Securities
Act of 1933) which extends credit or buys loans as one of its
businesses including, but not limited to, insurance companies, mutual
funds and lease financing companies, in each case (under clauses (i)
through (iv) above) that is reasonably acceptable to the Agent and, so
long as no Event of Default exists, the Company; and (B) any Lender
and any Affiliate of any Lender.
"Engagement Letter" means that engagement letter, dated as
of June 16, 1999, between the Company and BOCM.
"Environmental Laws" means any and all federal, state, local
and foreign statutes, laws, judicial decisions, regulations,
ordinances, rules, judgments, orders, decrees, plans, injunctions,
permits, concessions, grants, franchises, licenses, agreements and
other governmental restrictions relating to (i) the protection of the
environment, (ii) the effect of the environment on human health, (iii)
emissions, discharges or releases of pollutants, contaminants,
hazardous substances or wastes into surface water, ground water or
land, or (iv) the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of pollutants,
contaminants, hazardous substances or hazardous wastes or the clean-up
or other remediation thereof.
"Equity Interests" means (i) in the case of a corporation,
common and preferred stock, (ii) in the case of a limited liability
company, association or business entity, any and all shares,
interests, participations, ownership or voting rights or other
equivalents (however designated) of corporate stock, (iii) in the case
of a partnership, partnership interests (whether general or limited)
and (iv) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person, in each case
regardless of class or designation, and all warrants, options,
purchase rights, conversion or exchange rights, voting rights, calls
or claims of any character with respect thereto.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any rule or regulation issued
thereunder.
"Escrow Agent" means Norwest Bank Minnesota, N.A., in its
capacity as Escrow Agent under the Escrow Agreement, and its
successors in such capacity.
8
"Escrow Agreement" means an escrow agreement among the
Company, the Agent and the Escrow Agent, in substantially the form of
Exhibit VII hereto, as amended, restated, supplemented or otherwise
modified from time to time.
"Eurodollar Lending Office" shall mean, as to any Lender,
the office of such Lender designated as such on Annex I, or such other
office designated by such Lender from time to time by written notice
to the Agent and the Company.
"Event of Default" means each of the events set forth in
Section 7.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and any successor statute or statutes thereto.
"Exchange Notes" has the meaning ascribed to it in Section
5.12(b).
"Exchange Request" has the meaning ascribed to it in
Section 5.12.
"fair market value" means, with respect to any asset or
property, the price which could be negotiated in an arm's-length, free
market transaction, for cash, between a willing seller and a willing
and able buyer, neither of whom is under undue pressure or compulsion
to complete the transaction. Fair market value shall be determined by
the Board of Directors of the Company acting reasonably and in good
faith and shall be evidenced by a Board Resolution of the Board of
Directors of the Company delivered to the Agent.
"FCCC" means First Chicago Capital Corporation.
"Fee Letter" means that Amended and Restated Fee Letter
dated September 17, 1999 between the Company, FCCC and BOCM.
"Financial Contract" of a Person means (i) any exchange-
traded or over-the-counter futures, forward, swap or option contract
or other financial instrument with similar characteristics or (ii) any
Rate Management Transaction.
"Financing" means, with respect to any Person, the issuance
or sale by such Person of any Equity Interests of such Person or any
Indebtedness consisting of debt securities of such Person pursuant to
a registered offering or private placement, but excluding the issuance
or sale of (i) any Indebtedness permitted to be incurred pursuant to
Section 6.2, (ii) Equity Interests by the Borrower to any officer,
director or employee of the borrower or any of its Subsidiaries
9
pursuant to any incentive compensation plan or program and (iii)
Equity Interests or Indebtedness by any Subsidiary of the Borrower to
the Borrower or any Wholly-Owned Subsidiary of the Borrower.
"Financing Requirement" means the consideration to be paid
for the PSD Acquisition, the amount needed to repay certain of the
Indebtedness of the Company and the Target outstanding on the Closing
Date and the amount needed to pay the costs and expenses related to
the Transactions.
"Fiscal Year" means the fiscal year of the Company and each
Guarantor for accounting and tax purposes, which for all years after
the Closing Date shall end on December 31.
"Foreign Subsidiary" means any Subsidiary that is not a
Domestic Subsidiary.
"fully diluted" means all the shares of Common Stock of the
Company then outstanding or to be issued, calculated with respect to
any Warrant Release Date as if all shares of Common Stock of the
Company issuable upon conversion or exercise of any outstanding
warrants (including the Warrants issued from escrow up to and
including the most recent Warrant Release Date), options or similar
rights (including upon conversion or exchange of convertible or
exchangeable debt) are outstanding, and assuming that all options that
may be granted under employee benefit plans for the benefit of the
Company's employees are deemed to have been granted and exercised, and
assuming that any other Common Stock of the Company issuable pursuant
to any security, plan or arrangement of the Company (other than the
Warrants) has been issued.
"Funding Guarantor" shall have the meaning provided in
Section 10.7.
"GAAP" means generally accepted accounting principles as in
effect from time to time in the United States of America.
"Genetic Systems" means Genetic Systems Corporation, a
Delaware corporation.
"Governmental Authority" means any nation or government, any
federal, state, local or other political subdivision thereof and any
10
entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"Guarantee Obligations" shall have the meaning provided in
Section 11.1.
"Guarantees" means, collectively, the guarantees delivered
to the Lenders by the Guarantors pursuant to Section 10 which are
evidenced by notations of guarantee substantially in the form of
Exhibit VI hereto.
"Guarantor" means each of the Company's Domestic
Subsidiaries which constitutes a Material Subsidiary that in the
future executes a supplement or amendment to this Agreement in which
such Subsidiary agrees to be bound by the terms of the Loan Documents
as a Guarantor; provided that any Person constituting a Guarantor as
described above shall cease to constitute a Guarantor when its
respective Guarantee is released in accordance with the terms of the
Loan Documents. Notwithstanding the above, no direct or indirect
Foreign Subsidiary of the Company will be considered a Guarantor.
"Guarantor Junior Securities" means, with respect to a
Guarantor, securities of such Guarantor subordinated to the Guarantor
Senior Debt to the same extent as the Guarantee Obligations and which,
in any case, do not mature or become subject to a mandatory redemption
obligation prior to the one-year anniversary of the maturity of the
Guarantor Senior Debt or of any securities distributed in any
proceeding on account of the Guarantor Senior Debt.
"Guarantor Payment Blockage Period" shall have the meaning
provided in Section 11.2.
"Guarantor Senior Debt" means the Senior Debt of a
Guarantor.
"Incur" means, with respect to any Indebtedness or other
obligation of any Person, to create, issue, incur (by conversion,
exchange or otherwise), assume, guarantee or otherwise become liable
in respect of such Indebtedness or other obligation or the recording,
as required pursuant to GAAP or otherwise, of any such Indebtedness or
other obligation on the balance sheet of such Person (and
"Incurrence," "Incurred," "Incurrable" and "Incurring" shall have
meanings correlative to the foregoing); provided, however, that any
amendment, modification or waiver of any document pursuant to which
Indebtedness was previously Incurred shall only be deemed to be an
Incurrence of Indebtedness if and to the extent such amendment,
11
modification or waiver (i) increases the principal thereof or interest
rate or premium payable thereon or (ii) changes to an earlier date the
stated maturity thereof or the date of any scheduled or required
principal payment thereon or the time or circumstances under which
such Indebtedness shall be redeemed; provided, further, that any
Indebtedness of a Person existing at the time such Person becomes
(after the Closing Date) a Subsidiary of the Company (whether by
merger, consolidation, acquisition or otherwise) shall be deemed to be
Incurred by such Subsidiary at the time it becomes a Subsidiary of the
Company.
"Indebtedness" of a Person means, without duplication, such
Person's (i) obligations for borrowed money, (ii) obligations
representing the deferred purchase price of Property or services
(other than accounts payable arising in the ordinary course of such
Person's business payable on terms customary in the trade), (iii)
obligations which are evidenced by notes, acceptances, or other
instruments, (iv) obligations of such Person to purchase securities or
other Property arising out of or in connection with the sale of the
same or substantially similar securities or Property, (v) Capitalized
Lease Obligations, (vi) reimbursement obligations with respect to
standby letters of credit, whether drawn or undrawn, (vii) Rate
Management Obligations, (viii) Off-Balance Sheet Liabilities, (ix) all
liabilities and obligations of the type described in the preceding
clauses (i) through (viii) of any other Person that such Person has
assumed or guaranteed or that are secured by a Lien on any Property of
such Person (provided that if any such liability or obligation of such
other Person is not the legal liability of such Person, the amount
thereof shall be deemed to be the lesser of (1) the actual amount of
such liability or obligation and (2) the book value of such Person's
Property security such liability or obligation, and (x) any other
obligation for borrowed money or other financial accommodation which
in accordance with Agreement Accounting Principles would be shown as a
liability on the consolidated balance sheet of such Person.
"indemnified liabilities" has the meaning ascribed to such
term in Section 13.3.
"Indemnitees" has the meaning ascribed to such term in
Section 13.3.
"Interest Period" means, for each Bridge Note, the period
commencing on the Closing Date and ending on the immediately
succeeding Bridge Payment Date, and, thereafter, each subsequent
period commencing on the last day of the immediately preceding
Interest Period and ending on the immediately succeeding Bridge
Payment Date.
12
"Interest Rate Determination Date" means, with respect to
any Interest Period, the second Business Day on which banks in Chicago
and London are open prior to the first Business Day of such Interest
Period.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended from time to time, and any successor code or statute.
"Investment" of a Person means any loan, advance (other than
commission, travel and similar advances to officers and employees made
in the ordinary course of business), extension of credit (other than
accounts or notes receivable arising in the ordinary course of
business on terms customary in the trade) or contribution of capital
by such Person; stocks, bonds, mutual funds, partnership interests,
notes, debentures or other securities (other than treasury stock)
owned by such Person; any deposit accounts and certificate of deposit
owned by such Person; and structured notes, derivative financial
instruments and other similar instruments or contracts owned by such
Person. Payment by a Person under a guaranty by such Person of
Indebtedness of another Person shall be deemed to be an Investment by
such Person in such other Person in the amount of such payment.
"Junior Securities" means securities of the Company
subordinated to the Senior Debt to the same extent as the Obligations
and which, in any case, do not mature or become subject to a mandatory
redemption obligation prior to the one-year anniversary of the
maturity of the Senior Debt or of any securities distributed in any
proceeding on account of the Senior Debt.
"Lenders" has the meaning ascribed to that term in the
introduction to this Agreement and shall include any assignee of any
Loan, Note or Loan Commitment to the extent of such assignment.
"Leverage Ratio" means, as of any date of calculation, the
ratio of (i) Consolidated Funded Indebtedness outstanding on such date
to (ii) Consolidated EBITDA for the Company's then most-recently ended
four fiscal quarters.
"LIBO Base Rate" shall mean, with respect to each day during
an Interest Period, the rate per annum (rounded upwards, if necessary,
to the nearest 1/16th of 1%) appearing on Telerate Page 3750 (or any
successor page) as the London interbank offered rate for deposits in
Dollars at approximately 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period for a term comparable
to such Interest Period. If for any reason such rate is not
available, the term "LIBO Base Rate" shall mean, with respect to each
13
day during an Interest Period, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen
LIBO Page as the London interbank offered rate for deposits in Dollars
at approximately 11:00 a.m. (London time) two Business Days prior to
the first day of such Interest Period for a term comparable to such
Interest Period; provided, however, if more than one rate is specified
on Reuters Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such rates (rounded upwards, if necessary, to
the nearest 1/100 of 1%). In the event that neither of such rates is
available, the Agent shall refer to the alternative rate set forth in
Section 2.7(a).
"LIBO Rate" shall mean with respect to each day during an
Interest Period for the Bridge Loan, a rate per annum determined for
such day in accordance with the following formula (rounded upwards to
the nearest whole multiple of one-sixteenth of one percent):
LIBO Base Rate
---------------------
1.00 - LIBOR Reserve Requirements
"LIBOR Reserve Requirements" shall mean, with respect to
each day during an Interest Period for the Bridge Loan, that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Federal Reserve Board or other governmental
authority or agency having jurisdiction with respect thereto for
determining the maximum reserves (including, without limitation,
basic, supplemental, marginal and emergency reserves) for eurocurrency
funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D) maintained by a member bank of the Federal Reserve
System.
"Lien" means any lien (statutory or other), mortgage,
pledge, hypothecation, assignment, deposit arrangement, encumbrance or
preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without
limitation, the interest of a vendor or lessor under any conditional
sale, Capitalized Lease or other title retention agreement).
"Loan Commitment" means the Bridge Loan Commitment and the
Rollover Bridge Loan Commitment.
"Loan Documents" means this Agreement, the Bridge Notes, the
Rollover Bridge Notes, the Note Documents, the Registration
Statement, the Warrants and the Escrow Agreement.
14
"Loans" means the Bridge Loan and the Rollover Bridge Loan
as each may be outstanding.
"Loan Parties" means the Company and any Guarantor.
"Margin Stock" has the meaning assigned to that term in
Regulation U of the Board of Governors of the Federal Reserve System
as in effect from time to time.
"Material Adverse Effect" means a material adverse effect on
(i) the business, Property, condition (financial or otherwise) or
results of operations of the Company and its Subsidiaries taken as a
whole, (ii) the ability of the Company and the Guarantors collectively
to perform their obligations under the Loan Documents, or (iii) the
validity or enforceability of any of the Loan Documents or the rights
or remedies of the Agent or the Lenders thereunder.
"Material Domestic Subsidiary" means any Domestic
Subsidiary having assets (other than non-U.S. domiciled assets and
Equity Interests in Foreign Subsidiaries) with a book value of
$10,000,000 or more or any group of Domestic Subsidiaries on a
combined basis having such assets with a book value of $15,000,000 or
more.
"Material Indebtedness" is defined in Section 7.1(e).
"Material Subsidiary" means any Subsidiary, or group of
Subsidiaries on a combined basis, that constitutes a Substantial
Portion of the Property of the Company and its Subsidiaries.
"Maturity Date" means the one year anniversary of the
Closing Date.
"Maximum Cash Interest Rate" means an interest rate of 14%
per annum; provided that in computing such interest rate, fees paid to
the Lenders shall not be deemed an interest payment.
"Moody's" mean ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" means a Plan which is a multiemployer
plan as defined in Section 4001(a)(3) of ERISA and to which the
Company or any member of the Controlled Group is obligated to make
contributions.
15
"Net Cash Proceeds" means, with respect to any Asset Sale or
Financing by any Person or the issuance of the Permanent Securities,
(a) cash received by such Person or any Subsidiary of such Person from
such Asset Sale (including cash received as consideration for the
assumption or incurrence of liabilities incurred in connection with or
in anticipation of such Asset Sale) or Financing or the issuance of
the Permanent Securities, after (i) provision for all income or other
taxes measured by or resulting from such Asset Sale or Financing or
the issuance of the Permanent Securities, (ii) payment of all
brokerage commissions and other fees and expenses related to such
Asset Sale or Financing or the issuance of the Permanent Securities,
(iii) repayment of Indebtedness secured by a Lien on any asset
disposed of in such Asset Sale, (iv) deduction of appropriate amounts
to be provided by such Person or a Subsidiary of such Person as a
reserve, in accordance with Agreement Accounting Principles, against
any liabilities associated with the assets sold or disposed of in such
Asset Sale and retained by such Person or a Subsidiary of such Person
after such Asset Sale, including, without limitation, liabilities
related to environmental matters, or against any indemnification
obligations associated with the assets sold or disposed of in such
Asset Sale, and (v) in the case of a sale of a facility, the costs of
relocating the operations of the Borrower and its Subsidiaries from
that facility; and (b) cash payments in respect of any Indebtedness,
Equity Interest or other consideration received by such Person or any
Subsidiary of such Person from such Asset Sale upon receipt of such
cash payments by such Person or such Subsidiary.
"Non-Payment Default" means any event (other than a Payment
Default) the occurrence of which entitles one or more Persons to act
to accelerate the maturity of any Senior Debt.
"Note Documents" means the Exchange Notes, the Permanent
Securities, the Senior Subordinated Indenture, the indenture governing
the Permanent Securities and any guarantee related thereto.
"Notes" means, collectively, the Bridge Notes and the
Rollover Bridge Notes.
"Notice of Borrowing" means a notice substantially in the
form of Exhibit IV-A annexed hereto with respect to a proposed
borrowing.
"Obligations" means all obligations of every nature of the
Company from time to time owed to the Lenders and the Agent under the
Loan Documents, whether for principal, premiums, reimbursements,
16
interest, fees, expenses, indemnities or otherwise, and whether
primary, secondary, direct, indirect, contingent, fixed or otherwise
(including obligations of performance).
"Off-Balance Sheet Liability" of a Person means (i) any
repurchase obligation or recourse liability of such Person with
respect to the collectibility of accounts or notes receivable sold by
such Person, (ii) any liability under any Sale and Leaseback
Transaction which is not a Capitalized Lease, (iii) any liability
under any so-called "synthetic lease" transaction entered into by such
Person, or (iv) any obligation arising with respect to any other
transaction which is the functional equivalent of borrowing but which
does not constitute a liability on the balance sheet of such Person,
but excluding from this clause (iv) any lease of Property (other than
a Capitalized Lease) by such Person as lessee which has an original
term (including any required renewals and any renewals effective at
the option of the lessor) of one year or more.
"Offer Payment Date" has the meaning ascribed to such term
in Section 2.5(d)(iii).
"Officer" means, with respect to any Person, the Chairman of
the Board, the President, any Vice President, the Chief Financial
Officer, the Controller, the Treasurer or the Secretary of such
Person.
"Officers' Certificate" means, as applied to any
corporation, a certificate executed on behalf of such corporation by
two Officers; provided, however, that every Officers' Certificate with
respect to the compliance with a condition precedent to the making of
the Loans hereunder shall include (i) a statement that the officer or
officers making or giving such Officers' Certificate have read such
condition and any definitions or other provisions contained in this
Agreement relating thereto, (ii) a statement that, in the opinion of
the signers, they have made or have caused to be made such examination
or investigation as is necessary to enable them to express an informed
opinion as to whether or not such condition has been complied with,
and (iii) a statement as to whether, in the opinion of the signers,
such condition has been complied with.
"Original Bridge Notes" has the meaning ascribed to such
term in Section 2.1(d).
"Original Rollover Bridge Notes" has the meaning ascribed to
such term in Section 2.2(e).
17
"Payment Blockage Period" has the meaning ascribed to such
term in Section 8.2(b).
"Payment Default" means any default in the payment of
principal, premium, if any, or interest on any Senior Debt beyond any
applicable grace period with respect thereto.
"Payment Office" shall mean the office of the Agent located
at ▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or such other office as
the Agent may designate to the Company and the Lenders from time to
time.
"PBGC" means the Pension Benefit Guaranty Corporation, or
any successor thereto.
"Permanent Securities" means any Securities of the Company
and/or the Guarantors, the proceeds of which are used to repay the
Notes in full. If the Permanent Securities consist of debt
Securities, such Permanent Securities shall be governed by an
indenture or other instrument which contains covenants, events of
default and subordination provisions substantially similar to those
described in the "Description of Notes" set forth in the September 15,
1999 draft of the Company's Preliminary Offering Memorandum with
respect to $125,000,000 in principal amount of __% Senior Subordinated
Notes due 2009.
"Permitted Acquisition" means any Acquisition made by the
Company or any of its Subsidiaries, provided that (i) as of the date
of the consummation of such Acquisition, no Default or Event of
Default shall have occurred and be continuing or would result from
such Acquisition, and the representation and warranty contained in
Section 4.11 shall be true both before and after giving effect to such
Acquisition, (ii) such Acquisition is consummated on a non-hostile
basis pursuant to a negotiated acquisition agreement approved by the
board of directors or other applicable governing body of the seller or
entity to be acquired, and no material challenge to such Acquisition
(excluding the exercise of appraisal rights) shall be pending or
threatened by any shareholder or director of the seller or entity to
be acquired, (iii) the business to be acquired in such Acquisition is
reasonably related to one or more of the fields of enterprise in which
the Company and its Subsidiaries are engaged on the Closing Date
(after giving effect to the PSD Acquisition), (iv) as of the date of
the consummation of such Acquisition, all material approvals required
in connection therewith shall have been obtained, and (v) from the
period beginning on the Closing Date and ending on the date the Bridge
Notes are exchanged for Rollover Notes, as of the date of the
18
consummation of such Acquisition, the Company shall be in compliance
with the financial covenants contained in the Senior Secured Credit
Agreement as in effect on the Closing Date, both prior to and after
giving effect to such Acquisition.
"Person" means any natural person, corporation, firm, joint
venture, partnership, limited liability company, association,
enterprise, trust or other entity or organization, or any government
or political subdivision or any agency, department or instrumentality
thereof.
"PIK Interest Amount" has the meaning ascribed to such term
in Section 2.3(b).
"Plan" means an employee pension benefit plan which is
covered by Title IV of ERISA or subject to the minimum funding
standards under Section 412 of the Internal Revenue Code as to which
the Company or any member of the Controlled Group could reasonably be
expected to incur any liability.
"Prepayment Date" has the meaning set forth in Section
2.5(c).
"Property" of a Person means any and all property, whether
real, personal, tangible, intangible, or mixed, of such Person, or
other assets owned, leased or operated by such Person, including,
without limitation, Equity Interests of Subsidiaries of such Person.
"PSD Acquisition" means the acquisition by the Company of
the outstanding capital stock of the Target and certain related assets
(the "Acquired Business") pursuant to the PSD Purchase Agreement.
"PSD Purchase Agreement" means the Purchase Agreement dated
July 3, 1999 among the Company, Sanofi Synthelabo and Institut
Pasteur.
"Rate Management Transaction" means any transaction
(including an agreement with respect thereto) now existing or
hereafter entered into for bona fide hedging purposes (and not for
speculative purposes), which is a rate swap, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index
swap, equity or equity index option, bond option, interest rate
option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, forward transaction, currency swap
transaction, cross-currency rate swap transaction, currency option or
any other similar transaction (including any option with respect to
any of these transactions) or any combination thereof, whether linked
19
to one or more interest rates, foreign currencies, commodity prices,
equity prices or other financial measures.
"Rate Management Obligations" of a Person means any and all
obligations of such Person, whether absolute or contingent and
howsoever and whensoever created, arising, evidenced or acquired
(including all renewals, extensions and modifications thereof and
substitutions therefor), under (i) any and all Rate Management
Transactions, and (ii) any and all cancellations, buy backs,
reversals, terminations or assignments of any Rate Management
Transactions.
"Refinance" means, in respect of any security or
Indebtedness, to refinance, extend, renew, refund, repay, prepay,
redeem, defease or retire, or to issue a security or Indebtedness in
exchange or replacement for, such security or Indebtedness in whole or
in part. "Refinanced" and "Refinancing" shall have correlative
meanings.
"Register" has the meaning ascribed to such term in Section
13.20.
"Registration Statement" means a registration statement of
the Company and the Guarantors with respect to the Exchange Notes,
including the Prospectus, amendments and supplements to such
Registration Statement, including post-effective amendments, all
exhibits and all material incorporated by reference in such
Registration Statement.
"Related Documents" means the PSD Purchase Agreement and
each of the other agreements contemplated by the Commitment Letter or
the Fee Letter other than the Loan Documents and the Senior Secured
Credit Agreement.
"Reportable Event" means a reportable event as defined in
Section 4043 of ERISA and the regulations issued under such section,
with respect to a Plan, excluding, however, such events as to which
the PBGC has by regulation waived the requirement of Section 4043(a)
of ERISA that it be notified within 30 days of the occurrence of such
event, provided, however, that a failure to meet the minimum funding
standard of Section 412 of the Internal Revenue Code and of Section
302 of ERISA shall be a Reportable Event regardless of the issuance of
any such waiver of the notice requirement in accordance with either
Section 4043(a) of ERISA or Section 412(d) of the Internal Revenue
Code.
"Representative" means the indenture trustee or other
trustee, agent or representative in respect of any Senior Debt;
provided that if, and for so long as, any Senior Debt lacks such a
20
representative, then the Representative for such Senior Debt shall at
all times constitute the holders of a majority in outstanding
principal amount of such Senior Debt in respect of any Senior Debt.
"Required Lenders" means Lenders holding in the aggregate
more than 50% of the outstanding principal amount of Notes.
"Rollover Bridge Loan Commitment" has the meaning ascribed
to such term in Section 2.2(a).
"Rollover Bridge Notes" has the meaning ascribed to such
term in Section 2.2(c).
"Rollover Bridge Loan Rate" means, for the period from and
including the Maturity Date and to but excluding the three-month
anniversary of the Maturity Date, a rate of interest per annum equal
to the greater of (i) 14%, (ii) the Applicable Treasury Rate on the
Maturity Date plus 5.25%, and (iii) the rate of interest on the Bridge
Loan in effect on the Maturity Date. For each subsequent three month
period the Rollover Bridge Loan Rate means the Rollover Bridge Loan
Rate in effect for the immediately preceding three month period plus
0.50%.
"Rollover Loan" has the meaning ascribed to such term in
Section 2.2(a).
"Rollover Notice" means a notice substantially in the form
of Exhibit IV-B annexed hereto with respect to a proposed conversion.
"S&P" means Standard and Poor's Ratings Services, a division
of The McGraw Hill Companies, Inc.
"Sale and Leaseback Transaction" means any sale or other
transfer of Property by any Person with the intent to lease such
Property as lessee.
"▇▇▇▇▇▇▇▇ Group" means ▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, their
family and heirs, and corporations, partnerships and limited liability
companies 100% owned by any of the foregoing and trusts for the
benefit of any of the foregoing.
"Securities" means any stock, shares, partnership interests,
voting trust certificates, certificates of interest or participation
in any profit sharing agreement or arrangement, bonds, debentures,
options, warrants, notes, or other evidences of indebtedness, secured
21
or unsecured, convertible, subordinated or otherwise, or in general
any instruments commonly known as "securities" or any certificates of
interest, shares or participations in temporary or interim
certificates for the purchase or acquisition of, or any right to
subscribe to, purchase or acquire, any of the foregoing.
"Securities Act" means the Securities Act of 1933, as
amended, and any successor statute or statutes thereto.
"Senior Debt" means up to $220 million of the following: the
principal of, premium, if any, and interest (including any interest
accruing subsequent to an event specified in Section 7.1(f) or Section
7.1(g) hereof at the rate provided for in the documentation governing
such Senior Debt, whether or not such interest is an allowed claim
under applicable law) on, and all other obligations (including
reimbursements, fees, expenses, indemnities or otherwise, and whether
primary, secondary, direct, indirect, contingent, fixed or otherwise)
with respect to (i) all Indebtedness under or in respect of the Senior
Secured Credit Agreement and any guaranty of any Indebtedness under or
in respect of the Senior Secured Credit Agreement and (ii) all Rate
Management Transactions and any cancellation, buyback, reversal,
termination or assignment of any Rate Management Transaction.
"Senior Financing" means the initial borrowing by the
Company under the Senior Secured Credit Agreement to finance a portion
of the Financing Requirement.
"Senior Officers" means each of the Chief Executive Officer,
Chief Financial Officer and Chief Operating Officer of the Company.
"Senior Secured Credit Agreement" means the Credit Agreement
dated as of September 30, 1999, among Bio-Rad Laboratories, Inc., the
lenders party thereto in their capacities as lenders thereunder, Bank
One, NA, as agent, ABN Amro Bank N.V., as syndication agent, and Union
Bank of California, as documentation agent, together with the related
documents thereto (including, without limitation, any guarantee
agreements and security documents), in each case as such agreements
may be amended (including any amendment and restatement thereof),
supplemented, replaced, refinanced or otherwise modified from time to
time, including any agreement extending the maturity of, refinancing,
replacing or otherwise restructuring (including increasing the amount
of available borrowings thereunder (provided that such increase in
borrowings is permitted by Section 6.2 hereof) or adding or deleting
Subsidiaries as additional borrowers or guarantors thereunder) all or
22
any portion of the Indebtedness under such agreement or any successor
or replacement agreement and whether by the same or any other agent,
lender or group of lenders.
"Senior Subordinated Indenture" means an indenture, under
which the Exchange Notes will be issued, that complies with the Trust
Indenture Act of 1939 between the Company and a trustee conforming to
the terms and conditions of the Rollover Loan (except as described
below) and containing such other terms and conditions typical for
publicly traded high yield debt securities. The covenants, events of
default and subordination provisions of the Senior Subordinated
Indenture shall be substantially similar to those described in the
"Description of Notes" set forth in the September 15, 1999 draft of
the Company's Preliminary Offering Memorandum with respect to
$125,000,000 in principal amount of __% Senior Subordinated Notes due
2009. The Senior Subordinated Indenture shall have mandatory
redemption provisions typical for publicly traded high yield debt
securities. The Exchange Notes shall initially bear interest at the
Rollover Bridge Loan Rate. For so long as the Exchange Notes bear
interest at an increasing rate of interest, the Exchange Notes will be
redeemable at the option of the Company, in whole or in part at any
time, at par plus accrued and unpaid interest to the redemption date.
Each holder of the Exchange Notes shall have the option to fix the
interest rate on the Exchange Notes at a rate that is equal to the
then applicable rate of interest borne by the Exchange Notes (but in
no event in excess of 16% per annum). The Maximum Cash Interest Rate
shall apply to the Exchange Notes, with all interest in excess of the
Maximum Cash Interest Rate payable at the option of the Company in
additional Exchange Notes. In such event, such Exchange Notes will be
noncallable until the third anniversary of the Closing Date and will
be callable thereafter at par plus accrued interest plus a premium
equal to one-half of the coupon in effect on the date on which the
interest rate was fixed declining ratably to par on the date that is
one year prior to maturity of the Exchange Notes. The trustee shall be
appointed by the Company and shall be acceptable to the Lenders
receiving the Exchange Notes. The bank or trust company acting as
trustee under the Senior Subordinated Indenture shall at all times be
a corporation organized and doing business under the laws of the
United States of America or the State of New York, in good standing
and having its principal offices in the Borough of Manhattan, in The
City of New York, which is authorized under such laws to exercise
corporate trust powers and is subject to supervision or examination by
Federal or State authority and which has a combined capital and
surplus of not less than $50,000,000.
23
"Single Employer Plan" means a Plan (other than a
Multiemployer Plan) maintained by the Company or any member of the
Controlled Group for employees of the Company or any member of the
Controlled Group.
"Subordinated Indebtedness" means Indebtedness of the
Company or any Guarantor which is expressly subordinated in right of
payment to the Notes or the Guarantee of such Guarantor, as the case
may be.
"Subsequent Bridge Note" has the meaning ascribed to such
term in Section 2.1(d).
"Subsequent Rollover Bridge Note" has the meaning ascribed
to such term in Section 2.2(c).
"Subsidiary" of a Person means (i) any corporation more than
50% of the outstanding securities having ordinary voting power of
which shall at the time be owned or controlled, directly or
indirectly, by such Person or by one or more of its Subsidiaries or by
such Person and one or more of its Subsidiaries, or (ii) any
partnership, limited liability company, association, joint venture or
similar business organization more than 50% of the ownership interests
having ordinary voting power of which shall at the time be so owned or
controlled. Unless otherwise expressly provided, all references
herein to a "Subsidiary" shall mean a Subsidiary of the Company.
"Substantial Portion" means, with respect to the Property of
the Company and its Subsidiaries, Property which (i) represents more
than 10% of the consolidated assets of the Company and its
Subsidiaries as shown in the consolidated financial statements of the
Company and its Subsidiaries as at the end of the four fiscal quarter
period ending immediately prior to the fiscal quarter in which such
determination is made, or (ii) is responsible for more than 10% of the
consolidated net income of the Company and its Subsidiaries as
reflected in the financial statements referred to in clause (i) above.
"Synthetic Lease" is defined in Section 6.2(h).
"Target" means Pasteur Sanofi Diagnostics S.A.
"Taxes" has the meaning ascribed to such term in Section 2.10.
24
"Transactions" means the PSD Acquisition, the Senior
Financing, the borrowings of the Loans and the repayment of certain of
the outstanding Indebtedness of the Company and the Target.
"Tribunal" means any government, any arbitration panel, any
court or any governmental department, commission, board, bureau,
agency, authority or instrumentality of the United States or any
state, province, commonwealth, nation, territory, possession, county,
parish, town, township, village or municipality, whether now or
hereafter constituted and/or existing.
"Unfunded Liabilities" means the amount (if any) by which
the present value of all vested and unvested accrued benefits under
all Single Employer Plans exceeds the fair market value of all such
Plan assets allocable to such benefits, all determined as of the then
most recent valuation date for such Plans using PBGC actuarial
assumptions for single employer plan terminations.
"U.S. Legal Tender" means such coin or currency of the
United States of America as at the time of payment shall be legal
tender for the payment of public and private debts.
"Voting Equity Interests" means Equity Interests which at
the time are entitled to vote in the election of, as applicable,
directors, members or partners generally.
"Warrant Agreement" means a warrant agreement in
substantially the form of Exhibit VIII hereto, duly executed by each
Lender and the Company, relating to the Warrants.
"Warrants" means warrants, registered in blank, represented
by one or more warrant certificates in substantially the form attached
to the Warrant Agreement as a "Formula Warrant Certificate" or the
form attached to the Warrant Agreement as a "Release Warrant
Certificate", as applicable, each representing the right to buy one
share of the Company's Class A Common Stock at an exercise price equal
to 10% over the last quoted sales price of the Company's Common Stock
on the American Stock Exchange on the Closing Date and in the
aggregate representing the right to buy up to 10% of the "fully-
diluted" Common Stock of the Company for a period of 10 years
following the Closing Date.
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"Warrant Release Date" shall mean the Business Day after the
date on which BOCM delivers a Warrant Release Request (or any later
date specified in such Warrant Release Request).
"Warrant Release Request" means a written notice to the
Escrow Agent and the Company signed by a duly authorized officer of
BOCM (i) stating that (a) a specified portion of the Warrants are
necessary for the sale of the Permanent Securities as set forth in
Section 12(a) or (b) that the Lenders have become entitled to a
specified portion of the Warrants as set forth in Section 12(b), and
(ii) requesting that such specified portion of the Warrants be
released to BOCM for such purpose or to the Lenders, as applicable,
and (iii) specifying the names and denominations in which the Warrants
will be issued and the time of such issuance.
"Wholly Owned Subsidiary" of any Person means any Subsidiary
of such Person of which all the outstanding voting securities (other
than in the case of a Foreign Subsidiary, directors' qualifying shares
or an immaterial amount of shares required to be owned by other
Persons pursuant to applicable law) are owned by such Person or any
Wholly Owned Subsidiary of such Person. Unless otherwise specified,
all references to a "Wholly Owned Subsidiary" shall mean a Wholly
Owned Subsidiary of the Company.
"Year 2000 Issues" means anticipated costs, problems and
uncertainties associated with the inability of certain computer
applications (whether of the Company, any of its Subsidiaries, or any
of the Company's or any of its Subsidiaries' material customers,
suppliers or vendors) to effectively handle data including dates on
and after January 1, 2000, as such inability affects the business,
operations and financial condition of the Company and its
Subsidiaries.
"Year 2000 Program" is defined in Section 4.19.
1.2 Accounting Terms. For the purposes of this Agreement,
all accounting terms not otherwise defined herein shall have the
meanings assigned to them in conformity with GAAP.
1.3 Other Definitional Provisions; Anniversaries. Any of the
terms defined in Section 1.1 may, unless the context otherwise requires,
be used in the singular or the plural depending on the reference. For
purposes of this Agreement, a monthly anniversary of the Closing Date
shall occur on the same day of the applicable month as the day of the
month on which the Closing Date occurred; provided, however, that if
the applicable month has no such day (i.e., 29, 30 or 31), the monthly
26
anniversary shall be deemed to occur on the last day of the applicable
month.
SECTION 2. AMOUNT AND TERMS OF LOAN COMMITMENT AND LOANS; NOTES
2.1 Bridge Loan and Bridge Note.
(a) Bridge Loan Commitment. Subject to the terms and
conditions of this Agreement and in reliance upon the representations
and warranties of the Company herein set forth, the Lenders hereby
agree to lend to the Company on the Closing Date $100,000,000.00 (one
hundred million dollars) in the aggregate (the "Bridge Loan"), each
such Lender committing, severally and not jointly, to lend the amount
set forth next to such Lender's name on the signature pages hereto.
The Lenders' commitments to make the Bridge Loan to the Company
pursuant to this Section 2.1(a) are herein called individually, a
"Bridge Loan Commitment" and collectively, the "Bridge Loan
Commitments."
(b) Notice of Borrowing. When the Company desires to
borrow under this Section 2.1, it shall deliver to the Agent a Notice
of Borrowing no later than 11:00 A.M. (Chicago time), at least three
Business Days in advance of the Closing Date or such later date as
shall be agreed to by the Agent. The Notice of Borrowing shall
specify the applicable date of borrowing (which shall be a Business
Day). Upon receipt of such Notice of Borrowing, the Agent shall
promptly notify each Lender of its share of the Bridge Loan and the
other matters covered by the Notice of Borrowing.
(c) Disbursement of Funds. No later than 12:00 Noon
(Chicago time) on the Closing Date, each Lender will make available
its pro rata share of the Bridge Loan requested to be made on such
date in the manner provided below. All amounts shall be made
available to the Agent in U.S. Legal Tender and immediately available
funds at the Payment Office and the Agent promptly will make available
to the Company by depositing to its account at the Payment Office the
aggregate of the amounts so made available in the type of funds
received. Unless the Agent shall have been notified by any Lender
prior to the Closing Date that such Lender does not intend to make
available to the Agent its portion of the Bridge Loan to be made on
such date, the Agent may assume that such Lender has made such amount
available to the Agent on such date, and the Agent, in reliance upon
such assumption, may (in its sole discretion and without any
obligation to do so) make available to the Company a corresponding
amount. If such corresponding amount is not in fact made available to
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the Agent by such Lender and the Agent has made available same to the
Company, the Agent shall be entitled to recover such corresponding
amount from such Lender. If such Lender does not pay such
corresponding amount forthwith upon the Agent's demand therefor, the
Agent shall promptly notify the Company, and the Company shall
immediately pay such corresponding amount to the Agent. The Agent
shall also be entitled to recover from the Lender or the Company, as
the case may be, interest on such corresponding amount in respect of
each day from the date such corresponding amount was made available by
the Agent to the Company to the date such corresponding amount is
recovered by the Agent, at a rate per annum equal to (x) if paid by
such Lender, the overnight Federal Funds Rate or (y) if paid by the
Company, the then applicable rate of interest on the Loans.
Nothing herein shall be deemed to relieve any Lender from
its obligation to fulfill its Bridge Loan Commitment hereunder or to
prejudice any rights which the Company may have against any Lender as
a result of any default by such Lender hereunder.
(d) Bridge Notes. The Company shall execute and deliver
to each Lender on the Closing Date a Bridge Note dated the Closing
Date substantially in the form of Exhibit I annexed hereto to evidence
the portion of the Bridge Loan made on such date by such Lender and
with appropriate insertions ("Original Bridge Notes"). On each
interest payment date prior to the Maturity Date on which the Company
elects to pay a PIK Interest Amount pursuant to Section 2.3(b), the
Company shall execute and deliver to each Lender on such interest
payment date a Bridge Note dated such interest payment date
substantially in the form of Exhibit I annexed hereto in a principal
amount equal to such Lender's pro rata portion of such PIK Interest
Amount and with other appropriate insertions (each a "Subsequent
Bridge Note" and, together with the Original Bridge Notes, the "Bridge
Notes"). A Subsequent Bridge Note shall bear interest from the date
of its issuance at the same rate borne by all Bridge Notes.
(e) Scheduled Payment of Bridge Loan. Subject to Section
2.2, the Company shall pay in full the outstanding amount of the
Bridge Loan and all other Obligations owing hereunder no later than
the Maturity Date.
(f) Termination of Bridge Loan Commitment. The Bridge
Loan Commitment hereunder shall terminate on the earlier of (i) the
closing of the PSD Acquisition without the use of the Bridge Loan,
(ii) the termination of the PSD Purchase Agreement, (iii) the
acceptance by the Target or any of its affiliates of an offer for all
or any substantial portion of the assets or Common Stock of the Target
other than the offer contemplated in the Commitment Letter, (iv)
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immediately after the Closing Date, provided the Bridge Loan has been
made, or (v) 5:00 p.m., Chicago, Illinois time, on November 1, 1999.
The Company shall have the right, without premium or penalty, to
reduce or terminate the Bridge Loan Commitment of the Lenders
hereunder at any time. Any Loan repaid may not be redrawn.
(g) Pro Rata Borrowings. The Bridge Loan made under this
Agreement shall be made by the Lenders pro rata on the basis of their
respective Bridge Loan Commitments. It is understood that no Lender
shall be responsible for any default by any other Lender of its
obligation to make its portion of the Bridge Loan hereunder and that
each Lender shall be obligated to make its portion of the Bridge Loan
hereunder, regardless of the failure of any other Lender to fulfill
its commitments hereunder.
2.2 Rollover Bridge Loan and Rollover Bridge Note.
(a) Rollover Bridge Loan Commitment. Subject to the terms
and conditions of this Agreement, including without limitation the
conditions precedent set forth in Section 3.2, and in reliance upon
the representations and warranties of the Company herein set forth,
the Lenders hereby agree, upon the request of the Company, to convert
on the Maturity Date the then outstanding principal amount of the
Bridge Notes into a Rollover Bridge Loan (the "Rollover Bridge Loan"),
such Rollover Bridge Loan to be in the aggregate principal amount of
the then outstanding principal amount of the Bridge Notes. The
Company's request shall be evidenced by a Rollover Notice delivered to
the Lenders no later than 11:00 A.M. (Chicago time), at least two
Business Days in advance of the Maturity Date. The Lenders'
commitments under this Section 2.2(a) are herein called collectively,
the "Rollover Bridge Loan Commitment."
(b) Making of Rollover Bridge Loan. Upon satisfaction or
waiver of the conditions precedent specified in Section 3.2 hereof,
each Lender shall extend to the Company the Rollover Bridge Loan to be
issued on the Maturity Date by such Lender by canceling on its records
a corresponding principal amount of the Bridge Notes held by such
Lender.
(c) Maturity of Rollover Bridge Loan. The Rollover Bridge
Loan shall mature and the Company shall pay in full the outstanding
principal amount thereof and accrued interest thereon on September 30,
2005 (the "Final Maturity Date").
(d) Rollover Bridge Notes. The Company, as borrower,
shall execute and deliver to each Lender on the Maturity Date a
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Rollover Bridge Note dated the Maturity Date substantially in the form
of Exhibit II annexed hereto to evidence the Rollover Bridge Loan made
on such date, in the principal amount of the Bridge Notes held by such
Lender on such date and with other appropriate insertions
(collectively the "Original Rollover Bridge Notes"). On or after the
Maturity Date, on each interest payment date on which the Company
elects to pay a PIK Interest Amount pursuant to Section 2.3(b), the
Company shall execute and deliver to each Lender on such interest
payment date a Rollover Bridge Note dated such interest payment date
substantially in the form of Exhibit II annexed hereto in a principal
amount equal to such Lender's pro rata portion of such PIK Interest
Amount and with other appropriate insertions (each a "Subsequent
Rollover Bridge Note" and, together with the Original Rollover Bridge
Notes, the "Rollover Bridge Notes"). A Subsequent Rollover Bridge
Note shall bear interest at the same rate borne by all Rollover Bridge
Notes.
2.3 Interest on the Notes.
(a) Rate of Interest. The Notes shall bear interest on
the unpaid principal amount thereof from the date made through
maturity (whether by prepayment, acceleration or otherwise) at a rate
determined as set forth below.
(i) Bridge Notes. Subject to Section 2.3(a)(iii) and
Section 2.7, the Bridge Notes shall bear interest for each Interest
Period at a rate per annum equal to the LIBO Rate for such period plus
the Applicable Margin.
(ii) Rollover Bridge Notes. At any time after the
Maturity Date, the Rollover Bridge Notes shall bear interest at a rate
per annum equal to the Rollover Bridge Loan Rate.
(iii) Maximum Interest. Notwithstanding clause (i) or
(ii) of this Section 2.3(a) or any other provision herein, other than
Section 2.3(c), in no event will the combined sum of interest (cash or
otherwise) on the Bridge Notes or the Rollover Bridge Notes exceed the
lower of 18.00% per annum or the maximum interest rate permitted by
law.
(b) Interest Payments. Interest shall be payable (i) with
respect to the Bridge Notes, in arrears on October 12, 1999 and every
90 days thereafter (each of the preceding dates, a "Bridge Payment
Date") and upon any prepayment of the Bridge Notes (to the extent
accrued on the amount being prepaid) and on the Maturity Date in
respect of the principal amount of any Subsequent Bridge Notes and
(ii) with respect to the Rollover Bridge Notes, in arrears on each
March 31, June 30, September 30 and December 31 of each year,
30
commencing on the first of such dates to follow the Maturity Date,
upon any prepayment of the Rollover Bridge Notes (to the extent
accrued on the amount being prepaid) and on the Final Maturity Date;
provided, however, that if, on any interest payment date, the interest
rate borne by the Bridge Notes or the Rollover Bridge Notes, as the
case may be, exceeds the Maximum Cash Interest Rate, the Company may
pay all or a portion of the interest payable in excess of the amount
of interest that would be payable on such date at the Maximum Cash
Interest Rate by issuance of Subsequent Bridge Notes or Subsequent
Rollover Bridge Notes, as the case may be, in an aggregate principal
amount equal to the amount of such interest being so paid (the "PIK
Interest Amount").
(c) Post-Maturity Interest. Upon the occurrence and during
the continuance of any Event of Default, the Company shall pay
interest on the unpaid principal amount of each Note owing to each
Lender, payable on demand, at a rate per annum equal to the rate which
is (i) if any Rollover Bridge Notes are outstanding, 2.0% per annum in
excess of the rate per annum then borne by such Rollover Bridge Notes
and (ii) if any Bridge Notes are outstanding, the LIBO Rate plus 2%
per annum plus the Applicable Margin with respect to such Bridge
Notes. With respect to the amount of any interest, fee or other
amount payable hereunder that is not paid when due, from the date such
amount shall be due until such amount shall be paid in full, the
Company shall pay interest thereon, to the extent permitted under
applicable law, in arrears on the date such amount shall be paid in
full and on demand, at a rate per annum equal to the rate which is (i)
if any Rollover Bridge Notes are outstanding, 2.0% per annum in excess
of the rate per annum then borne by such Rollover Bridge Notes and
(ii) if any Bridge Notes are outstanding, the LIBO Rate plus 2% per
annum plus the Applicable Margin with respect to such Bridge Notes.
(d) Computation of Interest. Interest on the Loans shall
be computed on the basis of a 360-day year and, with respect to the
Bridge Loan, the actual number of days elapsed in the period during
which it accrues or, with respect to the Rollover Loan, twelve 30-day
months. In computing interest on the Loans, the date of the making of
the Loans shall be included and the date of payment shall be excluded;
provided, however, that if a Loan is repaid on the same day on which
it is made, one day's interest shall be paid on that Loan.
2.4 Fees. The Company agrees to pay to FCCC
and BOCM all fees and other obligations in accordance with, and at the
times specified by, the Fee Letter.
2.5 Prepayments and Payments.
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(a) Voluntary Prepayments. Prior to the Final Maturity
Date, the Company may, upon five days' prior written notice to each of
the Lenders, prepay the Loans at any time, in whole or in part, on a
pro rata basis, by paying to each applicable Lender an amount equal to
100% of such Lender's pro rata share of the aggregate principal amount
of the Loan to be prepaid, plus accrued and unpaid interest thereon to
the Prepayment Date and all other amounts then due and owing
hereunder; provided, however, that in connection with any prepayment
of a Bridge Note made on a date other than the expiration of the
Interest Period applicable thereto, the Company shall compensate each
Lender in accordance with Section 2.8.
(b) Mandatory Prepayments. The Company shall prepay the
Loans ratably in accordance with the aggregate outstanding principal
balances thereof, with 100% of the Net Cash Proceeds of: (i) the
issuance of the Permanent Securities, (ii) any Asset Sale and (iii)
any Financing; provided, however, that if any Indebtedness is
outstanding under the Senior Secured Credit Agreement, then any
amounts received pursuant to clauses (ii) and (iii) shall first be
used for (A) any required repayment of such Indebtedness or (B) with
respect to the Net Cash Proceeds of any Asset Sale, if permitted by
the Senior Secured Credit Agreement, investment in assets or Property
(other than Cash Equivalent Investments) in the Company's or any
Subsidiary's business within twelve months after such Asset Sale.
The Company shall, not later than the next Business Day
following the receipt of any Net Cash Proceeds required to be applied
to prepayment of the Loans pursuant to the immediately preceding
paragraph, apply such Net Cash Proceeds on a pro rata basis to prepay
the Loans by paying to each Lender an amount equal to 100% of such
Lender's pro rata share of the aggregate principal amount of the Loans
to be prepaid, plus accrued and unpaid interest thereon to the
Prepayment Date and any other amounts then due and owing hereunder.
Concurrently with any prepayment of the Loans pursuant to this Section
2.5(b), the Company shall deliver to the Agent an Officer's
Certificate demonstrating the calculation of the amount of the
applicable net proceeds that gave rise to such prepayment.
(c) Effect of Notice of Prepayment. The Company shall
notify the Lenders in writing at their addresses shown in the Register
of any date set for mandatory or optional prepayment (each such day, a
"Prepayment Date") of applicable Loans. Once such notice is sent or
mailed, the Loans to be prepaid shall become due and payable on the
Prepayment Date set forth in such notice. Such notice may not be
conditional.
(d) Purchase of Notes Upon a Change of Control.
32
(i) Upon the occurrence of a Change of Control, the
Company shall offer to prepay all or any part of the principal amount
of each Lender's Bridge Notes or Rollover Bridge Notes pursuant to the
offer described below (the "Change of Control Offer") at a prepayment
price in cash equal to 101% of the aggregate principal amount thereof,
plus accrued interest thereon to the date of repurchase.
(ii) At least ten days prior to any Change of Control,
the Company shall mail a notice to each Lender stating:
(1) that the Change of Control Offer is being made
pursuant to this Section 2.5(d) and that all Notes validly tendered
will be accepted for payment;
(2) the purchase price and the purchase date, which shall
be the date on which such Change of Control occurs (the "Offer Payment
Date");
(3) that any Note not tendered will continue to accrue
interest;
(4) that any Note accepted for payment pursuant to the
Change of Control Offer shall cease to accrue interest after the Offer
Payment Date unless the Company shall default in the payment of the
repurchase price of the Notes;
(5) that if a Lender elects to have a Note purchased
pursuant to the Change of Control Offer it will be required to
surrender the Note, with the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Note completed, to the Company prior
to 5:00 p.m. Chicago time on the Offer Payment Date;
(6) that a Lender will be entitled to withdraw its
election if the Company receives, not later than 5:00 p.m. Chicago
time on the Business Day preceding the Offer Payment Date, a telegram,
telex, facsimile transmission or letter setting forth the principal
amount of Notes such Lender delivered for purchase, and a statement
that such Lender is withdrawing its election to have such Note
purchased; and
(7) that if Notes are purchased only in part, a new Note
of the same type will be issued in principal amount equal to the
unpurchased portion of the Notes surrendered.
(iii) On or before the Offer Payment Date, the Company
shall (1) accept for payment Notes or portions thereof which are to be
purchased in accordance with the above, and (2) deposit at the Payment
Office U.S. Legal Tender sufficient to pay the purchase price of all
33
Notes to be purchased. The Agent shall promptly mail or, if provided
with appropriate instructions, send by wire transfer to the Lenders
whose Notes are so accepted payment in an amount equal to the purchase
price unless such payment is prohibited pursuant to Section 8 hereof
or otherwise.
(e) Manner and Time of Payment. All payments of
principal, interest, and any other amounts due hereunder and under the
Notes by the Company or the Guarantors shall be made without defense,
set-off or counterclaim and in same-day funds and delivered to the
Agent, unless otherwise specified, not later than 12:00 Noon (Chicago
time) on the date due at the Payment Office for the account of the
Lenders; funds received by the Agent after that time shall be deemed
to have been paid by the Company on the next succeeding Business Day.
Other than with respect to PIK Interest Amounts, all payments of any
Obligations to be made hereunder or under the Notes by the Company or
any other obligor with respect thereto shall be made solely in U.S.
Legal Tender or such other currency as is then legal tender for public
and private debts in the United States of America.
(f) Payments on Non-Business Days. Whenever any payment
to be made hereunder or under the Notes shall be stated to be due on a
day which is not a Business Day, the payment shall be made on the next
succeeding Business Day and such extension of time shall be included
in the computation of the payment of interest hereunder or under the
Notes or of the commitment fees and other amounts due hereunder, as
the case may be.
(g) Notation of Payment. Each Lender agrees that before
disposing of any Note held by it, or any part thereof (other than by
granting participations therein), such Lender will make a notation
thereon of all principal payments previously made thereon and of the
date to which interest thereon has been paid and will notify the
Company of the name and address of the transferee of that Note;
provided, however, that the failure to make (or any error in the
making of) such a notation or to notify the Company of the name and
address of such transferee shall not limit or otherwise affect the
obligation of the Company hereunder or under such Notes with respect
to the Loans and payments of principal or interest on any such Note.
2.6 Use of Proceeds.
(a) Bridge Loan. The proceeds of the Bridge Loan shall be
applied by the Company, together with borrowings under the Senior
34
Secured Credit Agreement and excess cash of the Company, to the
payment of the Financing Requirement.
(b) Rollover Bridge Loan. The proceeds of the Rollover
Bridge Loan shall be used to repay and cancel any outstanding amount
of Bridge Notes converted to Rollover Bridge Notes on such date.
(c) Margin Regulations. No portion of the proceeds of any
borrowing under this Agreement shall be used by the Company in any
manner which might cause the borrowing or the application of such
proceeds to violate the applicable requirements of Regulation U,
Regulation T or Regulation X of the Board of Governors of the Federal
Reserve System or any other regulation of the Board of Governors or to
violate the Exchange Act, in each case as in effect on the date or
dates of such borrowing and such use of proceeds. In addition,
following application of the proceeds of any borrowing under this
Agreement, not more than 25% of the value of the assets (either of the
Company only or of the Company and its Subsidiaries or a consolidated
basis) will be Margin Stock
2.7 Interest Rate Unascertainable, Increased Costs, Illegality.
(a) In the event that the Agent, in the case of clause (i)
below, or any Lender, in the case of clauses (ii) and (iii) below,
shall have determined (which determination shall, absent manifest
error, be final and conclusive and binding upon all parties hereto):
(i) on any date for determining the LIBO Rate for any
Interest Period, that by reason of any changes arising after the date
of this Agreement affecting the London interbank market, adequate and
fair means do not exist for ascertaining the applicable interest rate
on the basis provided for in the definition of the LIBO Rate; or
(ii) at any time, that the relevant LIBO Rate
applicable to any of its Notes shall not represent the effective
pricing to such Lender for maintaining a Bridge Loan, or such Lender
shall incur increased costs or reductions in the amounts received or
receivable hereunder in respect of any Bridge Note, in any such case
because of (x) any change since the date of this Agreement in any
applicable law or governmental rule, regulation, guideline or order or
any interpretation thereof and including the introduction of any new
law or governmental rule, regulation, guideline or order (such as for
example but not limited to a change in official reserve requirements,
but, in all events, excluding reserves required under Regulation D of
the Federal Reserve Board to the extent included in the computation of
35
the LIBO Rate), whether or not having the force of law and whether or
not failure to comply therewith would be unlawful, and/or (y) other
circumstances affecting such Lender or the London interbank market or
the position of such Lender in such market; or
(iii) at any time, that the making or continuance by it
of any Bridge Loan has become unlawful by compliance by such Lender in
good faith with any law or governmental rule, regulation, guideline or
order (whether or not having the force of law and whether or not
failure to comply therewith would be unlawful) or has become
impracticable as a result of a contingency occurring after the date of
this Agreement which materially and adversely affects the London
interbank market;
then, and in any such event, the Agent or such Lender shall, promptly
after making such determination, give notice (by telephone promptly
confirmed in writing) to the Company and (if applicable) the Agent of
such determination (which notice the Agent shall promptly transmit to
each of the other Lenders). Thereafter in the case of clause (i),
(ii) and (iii) above, each Bridge Note shall bear interest at a rate
equal to the Applicable Treasury Rate plus the Applicable Margin;
provided, however, that in the case of clause (ii) above, the Company
shall have the option of paying interest at a rate equal to the LIBO
Rate (if the Bridge Loan is then outstanding) plus the Applicable
Margin if it pays to such Lender, upon such Lender's delivery of
written demand therefor to the Company with a copy to the Agent, such
additional amounts (in the form of an increased rate of interest, or a
different method of calculating interest, or otherwise, as such Lender
in its sole discretion shall determine) as shall be required to
compensate such Lender for such increased costs or reduction in
amounts received or receivable hereunder.
(b) In the event that the Agent determines at any time
following its giving of notice based on the conditions described in
clause (a)(i) above that none of such conditions exist, the Agent
shall promptly give notice thereof to the Company and the Lenders,
whereupon the Bridge Notes will again bear interest pursuant to
Section 2.3.
(c) In the event that a Lender determines at any time
following its giving of a notice based on the conditions described in
clause (a)(iii) above that none of such conditions exist, such Lender
shall promptly give notice thereof to the Company and the Agent,
whereupon the Bridge Notes held by such Lender shall bear interest
pursuant to Section 2.3.
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2.8 Funding Losses. The Company shall compensate each Lender,
upon such Lender's delivery of a written demand therefor to the Company,
with a copy to the Agent (which demand shall set forth the basis for
requesting such amounts and shall, absent manifest error, be final and
conclusive and binding upon all of the parties hereto), for all
reasonable losses, expenses and liabilities (including, without
limitation, any loss, expense or liability incurred by such Lender in
connection with the liquidation or reemployment of deposits or funds
required by it to make or carry its Bridge Notes), that such Lender
sustains: (i) if for any reason (other than a default by such Lender)
a borrowing of Bridge Notes does not occur on a date specified therefor
in a Notice of Borrowing (whether or not rescinded, cancelled or
withdrawn or deemed rescinded, cancelled or withdrawn,), (ii) if any
repayment (including, without limitation, payment after acceleration)
or conversion of any of its Bridge Notes occurs on a date which is not
the last day of the Interest Period applicable thereto, (iii) if any
prepayment of any of its Bridge Notes is not made on any date specified
in a notice of prepayment given by the Company, or (iv) as a consequence
of any default by the Company in repaying its Bridge Notes or any other
amounts owing hereunder in respect of its Bridge Notes when required
by the terms of this Agreement. Calculation of all amounts payable to
a Lender under this Section 2.8 shall be made on the assumption that
such Lender has funded its relevant Bridge Notes through the purchase
of a Eurodollar deposit bearing interest at the LIBO Rate in an amount
equal to the amount of such Bridge Notes with a maturity equivalent to
the Interest Period applicable to such Bridge Notes, and through the
transfer of such Eurodollar deposit from an offshore office of such
Lender to a domestic office of such Lender in the United States of
America, provided that each Lender may fund its Eurodollar Loans in
any manner that it in its sole discretion chooses and the foregoing
assumption shall only be made in order to calculate amounts payable
under this Section 2.8.
2.9 Increased Capital.
(a) If any Lender shall have determined that compliance
with any applicable law, rule, regulation, guideline, request or
directive (whether or not having the force of law) of any governmental
authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on the capital or assets of such
Lender or any Person controlling such Lender as a consequence of its
commitments or obligations hereunder, then from time to time, upon
such Lender's delivery of a written demand therefor to the Agent and
the Company (with a copy to the Agent), the Company shall pay to such
Lender such additional amount or amounts as will compensate such
Lender or Person for such reduction.
37
(b) In the event that any change in law occurring after
the date that any lender becomes a Lender party to this Agreement
shall, in the opinion of such Lender, require that any Bridge Loan
Commitment of such Lender be treated as an asset or otherwise be
included for purposes of calculating the appropriate amount of capital
to be maintained by such Lender or any Person controlling such Lender,
and such change in law shall have the effect of reducing the rate of
return on the capital or assets of such Lender or any Person
controlling such Lender as a consequence of its commitments or
obligations hereunder, then from time to time, upon such Lender's
delivery of a written demand therefor to the Agent and the Company
(with a copy to the Agent), the Company shall pay to such Lender such
additional amount or amounts as will compensate such Lender or Person
for such reduction.
2.10 Taxes.
(a) All payments made by the Company under this Agreement
and the other Loan Documents shall be made free and clear of, and
without reduction or withholding for or on account of, any present or
future income, stamp or other taxes, levies, imposts, duties, charges,
fees, deductions or withholdings, now or hereafter imposed, levied,
collected, withheld or assessed by any governmental authority
excluding, in the case of the Agent and each Lender, net income and
franchise taxes imposed on the Agent or such Lender by the
jurisdiction under the laws of which the Agent or such Lender is
organized or any political subdivision or taxing authority thereof or
therein, or by any jurisdiction in which such Lender's Domestic
Lending Office or Eurodollar Lending Office, as the case may be, is
located or any political subdivision or taxing authority thereof or
therein (all such non-excluded taxes, levies, imposts, deductions,
charges or withholdings being hereinafter called "Taxes"). If any
Taxes are required to be withheld from any amounts payable to the
Agent or any Lender hereunder or under the Notes, the amounts so
payable to the Agent or such Lender shall be increased to the extent
necessary to yield to the Agent or such Lender (after payment of all
Taxes) interest or any such other amounts payable hereunder at the
rates or in the amounts specified in this Agreement and the Notes.
The Company agrees to indemnify and hold harmless the Agent and any
Lender for the full amount of Taxes paid by the Agent or such Lender
and any incremental taxes, interest or penalties arising therefrom or
with respect thereto, whether or not such Taxes were correctly or
legally asserted. Payment under this indemnification shall be made
within 30 days after the date the Agent or any Lender makes written
demand therefor. Whenever any Taxes are payable by the Company, as
promptly as possible thereafter, and in any event within 30 days, the
Company shall send to the Agent for its own account or for the account
38
of such Lender, as the case may be, a certified copy of an original
official receipt received by the Company showing payment thereof. If
the Company fails to pay any Taxes when due to the appropriate taxing
authority or fails to remit to the Agent the required receipts or
other required documentary evidence, the Company shall indemnify the
Agent and the Lenders for any incremental taxes, interest or penalties
that may become payable by the Agent or any Lender as a result of any
such failure. The agreements in this Section 2.10 shall survive the
termination of this Agreement and the payment of the Notes and all
other Obligations.
(b) Each Lender that is not incorporated under the laws of
the United States of America or a state thereof (including each
assignee, transferee or recipient that becomes a party to this Agree-
ment pursuant to Section 13.1) agrees that, prior to the first date on
which any payment is due to it hereunder, it will deliver to the
Company and the Agent (i) two duly completed copies of United States
Internal Revenue Service Form 1001 or 4224 or successor applicable
form, as the case may be, certifying in each case that such Lender is
entitled to benefits under an income tax treaty to which the United
States is a party that reduces the rate of withholding tax on payments
under this Agreement or certifying that the income receivable pursuant
to this Agreement is effectively connected with the conduct of a trade
or business in the United States, and (ii) an Internal Revenue Service
Form W-8 or W-9 or successor applicable form, as the case may be, to
establish an exemption from United States backup withholding tax. If
the form provided by a Lender prior to the first date on which a
payment is due to it hereunder indicates a United States interest
withholding tax rate in excess of zero, withholding tax at such rate
shall be considered excluded from Taxes unless and until such Lender
provides the appropriate form certifying that a lesser rate applies,
whereupon withholding tax at such lesser rate only shall be considered
excluded from Taxes; provided, however, that, if at the date of an
assignment under Section 13.1(a) pursuant to which such Lender
assignee becomes a party to this Agreement, the Lender assignor was
entitled to payments under subsection 2.10(a) in respect of United
States withholding tax with respect to interest paid at such date,
then, to such extent, the term Taxes shall include (in addition to
withholding taxes that may be imposed in the future or other amounts
otherwise includible in Taxes) United States withholding tax, if any,
applicable with respect to the Lender assignee on such date. Each
Lender which delivers to the Company and the Agent a Form 1001 or 4224
and Form W-8 or W-9 pursuant to the preceding sentence further
undertakes to deliver to the Company and the Agent two further copies
of the said letter and Form 1001 or 4224 and Form W-8 or W-9, or
successor applicable forms, or other manner of certification, as the
case may be, on or before the date that any such letter or form
expires or becomes obsolete or after the occurrence of any event
39
requiring a change in the most recent letter and form previously
delivered by it to the Company, and such extensions or renewals
thereof as may reasonably be requested by the Company, certifying in
the case of a Form 1001 or 4224 that such Lender is entitled to
receive payments under this Agreement without deduction or withholding
of any United States federal income taxes, unless in any such case an
event (including, without limitation, any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery
would otherwise be required which renders all such forms inapplicable
or which would prevent such Lender from duly completing and delivering
any such letter or form with respect to it and such Lender advises the
Company that it is not capable of receiving payments without any
deduction or withholding of United States federal income tax, and in
the case of a Form W-8 or W-9, establishing an exemption from United
States backup withholding tax.
SECTION 3. CONDITIONS
3.1 Conditions to Bridge Loan. The obligation of the Agent
and each Lender to make the Bridge Loan is subject to the prior or
concurrent satisfaction of each of the following conditions:
(a) Document Delivery. On or before the Closing Date, all
corporate and other proceedings taken or to be taken in connection
with the transactions contemplated hereby and all documents incidental
thereto not previously found acceptable by the Agent shall be
reasonably satisfactory in form and substance to the Agent, and the
Agent shall have received on behalf of the Lenders the following
items, each of which shall be in form and substance satisfactory to
the Agent and, unless otherwise noted below or in the definition
thereof, dated the Closing Date:
(i) executed copies of this Agreement and the Bridge
Notes substantially in the form of Exhibit I annexed hereto executed
in accordance with Section 2.1(d) drawn to the order of the Lenders
and with appropriate insertions;
(ii) an executed copy of the Escrow Agreement
substantially in the form of Exhibit VII annexed hereto;
(iii) a certified copy of the Company's charter,
together with a certificate of status, compliance, good standing or
like certificate with respect to the Company issued by the appropriate
government officials of the jurisdiction of its incorporation and of
each jurisdiction in which it owns any material assets or carries on
40
any material business, each to be dated a recent date prior to the
Closing Date;
(iv) a copy of the Company's bylaws, certified as of
the Closing Date by its Secretary or one of its Assistant Secretaries;
(v) a copy of any stockholders' agreements or any
other ownership arrangements for the Company, certified as of the
Closing Date by its Secretary or one of its Assistant Secretaries;
(vi) Board Resolutions of the Company approving and
authorizing the execution, delivery and performance of this Agreement,
each of the other Loan Documents and the Related Documents, the Senior
Secured Credit Agreement, the Transactions and any other documents,
instruments and certificates required to be executed by the Company in
connection herewith and therewith and approving and authorizing the
execution, delivery and payment of the Notes and the consummation of
the Transactions;
(vii) signature and incumbency certificates of the
Company's officers executing this Agreement and the Bridge Notes;
(viii) an originally executed Notice of Borrowing
substantially in the form of Exhibit IV-A annexed hereto, signed by
the President or a Vice President of the Company on behalf of the
Company and delivered to the Agent;
(ix) originally executed copies of one or more
favorable written opinions of (I) ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇, counsel for the
Company, substantially in the form of Exhibit V annexed hereto and
addressed to the Lenders and (II) such other opinions of counsel and
such certificates or opinions of accountants, appraisers or other
professionals as the Agent shall have reasonably requested;
(x) a certificate of the Chief Financial Officer or
the Treasurer of the Company addressed to the Agent and the Lenders
and in form and substance satisfactory to the Agent and the Lenders,
attesting that, on a pro forma basis, after giving effect to the PSD
Acquisition and the other Transactions, including the full borrowings
under the Senior Secured Credit Agreement, the Company and its
Subsidiaries (individually or in the aggregate) shall be solvent;
(xi) a true and correct copy of the PSD Purchase
Agreement, which shall not have been amended without the Agent's
41
consent and which shall be in full force and effect, and a copy of all
closing documents relating to the PSD Acquisition and all such
counterpart originals or certified copies of such documents,
instruments, certificates and opinions (together with reliance letters
for the benefit of the Agent and the Lenders) related thereto as the
Agent may reasonably request;
(xii) executed or conformed copies of the Senior
Secured Credit Agreement and any amendments thereto made on or prior
to the Closing Date and a copy of each legal opinion delivered in
connection with the Senior Secured Credit Agreement;
(xiii) executed payoff letters with respect to
Indebtedness existing prior to the Closing Date which is not listed on
Schedule 6.2;
(xiv) copies of all documents actually delivered to the
lenders and/or agent under the Senior Secured Credit Agreement as a
condition to the loans thereunder not otherwise required to be
delivered under this Section 3.1; and
(xv) such other documents, certificates and opinions
as the Agent may reasonably request.
(b) Concurrent Transactions; Documentation. The Senior
Financing shall have been consummated on terms satisfactory to the
Agent pursuant to definitive documentation in form and substance
satisfactory to the Agent and all conditions precedent to the
consummation of the Senior Financing shall have been satisfied or,
with the prior approval of the Agent, waived. Funds from the Senior
Financing and the Bridge Loan, together with the Company's excess
cash, shall be sufficient to consummate the Transactions. The PSD
Acquisition shall have been consummated on terms satisfactory to the
Agent pursuant to the provisions of the PSD Purchase Agreement, which
shall be in form and substance satisfactory to the Agent, and all
conditions precedent to the consummation of the PSD Acquisition shall
have been satisfied or, with the prior approval of the Agent, waived.
(c) Capitalization; Etc. The corporate, capital and
ownership structure (including articles of incorporation and bylaws),
stockholders' agreements and management of the Company and its
Subsidiaries (after giving effect to the Transactions) shall be
satisfactory to the Agent in all respects.
(d) Due Diligence. The Agent and its counsel shall have
completed their business, legal, environmental, tax, pension,
42
regulatory and accounting due diligence review of the Company's and
the Target's business, assets, liabilities (actual and contingent),
operations, condition (financial or otherwise), management, prospects
and value and shall be satisfied with the results thereof (including,
if requested by the Agent, an environmental review report,
satisfactory in from and substance to the Agent, from an environmental
review firm acceptable to the Agent, as to any environmental hazards
or liabilities and the Company's plans with respect thereto).
(e) Financial Statements. The Agent shall have received
and, in each case, approved all audited, unaudited and pro forma
financial statements described in Section 4.4 and all completed,
probable and pending acquisitions, including the PSD Acquisition, all
meeting the requirements of Regulation S-X under the Securities Act,
applicable to a Registration Statement under the Securities Act on
Form S-1, except that the Agent and the Lenders acknowledge and agree
that such financial statements shall not include interim 1998
financial data for the Target. All such financial statements of the
Target shall be prepared in accordance with GAAP.
(f) Material Adverse Change. No material adverse change
(including any event which, in the opinion of the Agent, is reasonably
likely to result in such a material adverse change) in the business,
assets, liabilities (actual and contingent), operations, condition
(financial or otherwise), management, prospects or value of the
Company and its Subsidiaries, taken as a whole, or the Target and its
Subsidiaries, taken as a whole, shall have occurred since the date of
the most recent audited annual financial statements of the Company and
the Target described in Section 4.4 and delivered to the Agent as of
the date of the Commitment Letter, and no material inaccuracy in such
financial statements shall exist.
(g) Market Conditions. No material adverse change in the
financial or capital markets generally, or in the market for high
yield debt or bridge loans in particular, shall have occurred which,
in the judgment of the Agent, would make it impractical or inadvisable
to proceed with the funding of the Bridge Loan or the sale of the
Permanent Securities. No banking moratorium shall have been declared
by Federal or Illinois banking officials.
(h) Other Obligations. On or prior to the Closing Date,
(A) all fees and expenses due and payable to FCCC, BOCM, any other
Lender and/or their affiliates pursuant to the Commitment Letter, the
Engagement Letter, or the Fee Letter shall have been paid in full as
contemplated therein, and (B) the Company shall have complied with all
of its obligations under the Commitment Letter, the Engagement Letter,
43
the Fee Letter and the Related Documents, and each such agreement
shall be in full force and effect.
(i) Consents. All governmental, shareholder and third-
party consents (including ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ clearance) and approvals
necessary or reasonably advisable in connection with the Transactions
and the other transactions contemplated hereby shall have been
obtained; all such consents and approvals shall be in full force and
effect; and all applicable waiting periods shall have expired without
any action being taken or threatened by any authority that could
restrain, prevent or impose any material adverse conditions on the
Transactions or such other transactions.
(j) Judgments, Etc. There shall not exist (A) any order,
decree, judgment, ruling or injunction which restrains the
consummation of the Transactions in the manner contemplated by the PSD
Purchase Agreement, or (B) any pending or threatened action, suit,
investigation or proceeding before any Tribunal that, if adversely
determined, could have a Material Adverse Effect.
(k) Intellectual Property. The Company shall provide a
schedule of all United States registered patents and United States
registered trademarks for the Company and the Target.
(l) Other Reports. The Agent shall have received, in form
and substance reasonably satisfactory to it, all environmental
reports, Year 2000 questionnaires and such other reports as it may
reasonably request.
(m) Officer's Certificate. Simultaneously with the making
of the Bridge Loan by the Lenders, the Company shall have delivered to
the Agent an Officers' Certificate from the Company in form and
substance satisfactory to the Agent to the effect that (i) the
representations and warranties in Section 4 are true, correct and
complete in all material respects on and as of the Closing Date to the
same extent as though made on and as of that date, (ii) on or prior to
the Closing Date, the Company has performed and complied in all
material respects with all covenants and conditions required to be
performed and observed by the Company on or prior to the Closing Date
and (iii) all conditions to the consummation of the PSD Acquisition in
the PSD Purchase Agreement have been satisfied substantially on the
terms set forth therein and have not been waived or amended without
the Agent's prior written consent.
44
(n) No Default. No event shall have occurred and be
continuing or would result from the consummation of the borrowing
contemplated by the Notice of Borrowing which would constitute a
Default or Event of Default.
(o) Regulatory Requirements The making of the Bridge Loan
in the manner contemplated in this Agreement shall not violate the
applicable provisions of Regulation T, U or X of the Board of
Governors of the Federal Reserve Board or any other regulation of the
Board.
(p) Ordinary Course Operations. From the date of the
Commitment Letter, the Company shall have operated its business in the
ordinary course, except as contemplated by the Transactions.
(q) Offering Memorandum. The Company shall have delivered
to BOCM (i) a preliminary offering memorandum to be distributed at the
direction of BOCM to potential purchasers, containing all relevant
information about the Transactions, the Target and any other matters
which BOCM may deem necessary to a successful offering or which BOCM
or the Company may consider necessary or appropriate for accurate,
complete and adequate disclosure, (ii) management's projections for
the Company after giving pro forma effect to the Transactions and
(iii) such other information as may be reasonably requested by any
rating agency or by BOCM or their counsel.
(r) Escrowed Warrants. The Company shall have executed
the Warrant Agreement and the Warrants and shall have delivered them
to the Escrow Agent to be held in escrow pursuant to the Escrow
Agreement.
(s) Repayment of Existing Indebtedness. The Company shall
have paid (or made arrangements to pay concurrently with the making of
the Bridge Loan hereunder) all principal, interest, fees and premiums,
if any, on all Indebtedness outstanding prior to the Closing Date
which is not listed on Schedule 6.2 or otherwise permitted under this
Agreement.
3.2 Conditions to Rollover Bridge Loan. The obligation of
the Lenders to make the Rollover Bridge Loan on the Maturity Date is
subject to the prior or concurrent satisfaction or waiver of the
following conditions precedent:
(a) No Default. There shall exist no Default or Event of
Default on the Maturity Date.
45
(b) Fees, etc. All fees due to FCCC, BOCM and/or the
other Lenders shall have been paid in full and all other requirements
and obligations under the Fee Letter and the Engagement Letter shall
have been satisfied or fulfilled.
(c) No Injunction, Etc. No order, decree, injunction or
judgment enjoining the issuance of any Rollover Bridge Loan shall be
in effect.
(d) Senior Subordinated Indenture. At least thirty (30)
days prior to the Maturity Date, the Company shall have delivered a
draft of the Senior Subordinated Indenture reasonably acceptable to
the Lenders, and such Senior Subordinated Indenture shall be in full
force and effect on or prior to the Maturity Date.
(e) Registration Statement. A Registration Statement
shall be in effect for the issuance of Exchange Notes to the Lenders.
(f) Rollover Notice. The Agent shall have received in
accordance with the provisions of Section 2.2(a) an originally
executed Rollover Notice.
(g) Officer's Certificate. On the Maturity Date, the
Agent shall have received an Officers' Certificate from the Company
dated the Maturity Date and satisfactory in form and substance to the
Agent, to the effect that the conditions in this Section 3.2 are
satisfied on and as of the Maturity Date.
(h) Rollover Bridge Notes. The Company shall have
executed and delivered to the Agent on the Maturity Date for delivery
to the Lenders, Rollover Bridge Notes dated the Maturity Date
substantially in the form of Exhibit II annexed hereto to evidence the
Rollover Bridge Loan, in the principal amount of the Rollover Bridge
Loan (which principal amount shall be the aggregate principal amount
of the Bridge Loan outstanding on the Maturity Date, including the
principal amount of any Subsequent Bridge Notes), and with other
appropriate insertions.
(i) Certain Regulations. The making of the Rollover
Bridge Loan shall not violate Regulation T, U or X of the Board of
Governors of the Federal Reserve Board or any other regulation of the
Board.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
In order to induce the Lenders to enter into this Agreement
and to make the Loans, the Company represents and warrants to the
46
Lenders that, at the time of execution hereof and on the Closing Date,
the following statements are true, correct and complete:
4.1 Existence and Standing. Each of the Company and its
Subsidiaries is a corporation, partnership (in the case of Subsidiaries
only) or limited liability company duly and properly incorporated or
organized, as the case may be, validly existing and (to the extent
such concept applies to such entity) in good standing under the laws of
its jurisdiction of incorporation or organization and has all requisite
authority to own, operate and encumber its Property and to conduct
its business, as presently conducted and as proposed to be conducted
giving effect to the PSD Acquisition, in each jurisdiction in which
its business is conducted, except for any failure to be so authorized
that could not reasonably be expected to have a Material Adverse Effect.
4.2 Authorization and Validity. Each Loan Party has the power
and authority and legal right to execute and deliver the Loan Documents
to which it is a party and to perform its obligations thereunder. The
execution and delivery by each Loan Party of the Loan Documents to which
it is a party and the performance of its obligations thereunder have
been duly authorized by proper corporate (or equivalent) proceedings,
and the Loan Documents to which such Loan Party is a party constitute
legal, valid and binding obligations of such Loan Party enforceable
against such Loan Party in accordance with their respective terms,
except to the extent that the enforceability thereof may be limited by
applicable bankruptcy, insolvency, reorganization or similar laws
affecting the enforcement of creditors' rights generally or by general
principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law).
4.3 No Conflict; Government Consent. Neither the execution
and delivery by the Loan Parties of the Loan Documents, nor the
consummation of the transactions therein contemplated, nor compliance
with the provisions thereof will violate (i) any law, rule, regulation,
order, writ, judgment, injunction, decree or award binding on the Company
or any of its Subsidiaries or (ii) the Company's or any Subsidiary's
articles or certificate of incorporation, partnership agreement,
certificate of partnership, articles or certificate of organization,
by-laws, or operating or other management agreement, as the case may be,
or (iii) the provisions of any indenture, instrument or agreement to
which the Company or any of its Subsidiaries is a party or is subject,
or by which it, or its Property, is bound, or conflict with or constitute
a default thereunder, or result in, or require, the creation or
imposition of any Lien in, of or on the Property of the Company or any
Subsidiary pursuant to the terms of any such indenture, instrument or
47
agreement. No order, consent, adjudication, approval, license,
authorization, or validation of, or filing, recording or registration
with, or exemption by, or other action in respect of any Governmental
Authority which has not been obtained by the Company or any of its
Subsidiaries, is required to be obtained by the Company or any of its
Subsidiaries in connection with the execution and delivery of the Loan
Documents, the borrowings under this Agreement, the payment and
performance by the Company of the Obligations or the legality,
validity, binding effect or enforceability of any of the Loan
Documents, except filings, consents or notices which have been made,
obtained or given, or which, if not made, obtained or given,
individually or in the aggregate could not reasonably be expected to
have a Material Adverse Effect.
4.4 Financial Statements.
(a) The December 31, 1998 audited consolidated financial
statements and the March 31, 1999 and June 30, 1999 unaudited
consolidated financial statements of the Company and its Subsidiaries
heretofore delivered to the Lenders were prepared in accordance with
generally accepted accounting principles in effect on the date such
statements were prepared and fairly present the consolidated financial
condition and operations of the Company and its Subsidiaries at such
dates and the consolidated results of their operations for the periods
then ended, subject, in the case of such unaudited financial statements,
to normal year-end adjustments and the absence of notes.
(b) The December 31, 1998, financial statements of the
Acquired Business and any additional financial statements of the
Acquired Business required by the Securities and Exchange Commission
heretofore delivered to the Lenders were prepared in accordance with
GAAP in effect on the date such statements were prepared and fairly
present the financial condition and operations of the Acquired
Business at such dates and the results of its operations for the
periods then ended.
(c) The pro forma financial statements of the Company and
its Subsidiaries, copies of which are attached hereto as Schedule 4.4,
present on a pro forma basis the financial condition of the Company
and its Subsidiaries as of such date, and reflect on a pro forma basis
those liabilities reflected in the notes thereto and resulting from
consummation of the PSD Acquisition, the transactions contemplated by
this Agreement and the Senior Secured Credit Agreement, and the
payment or accrual of all costs and expenses with respect to any of
the foregoing. The projections and assumptions expressed in such pro
forma financials were prepared in good faith and represent good faith
assumptions and estimates on the part of the Company based on the
information available to the Company at the time so prepared.
48
4.5 Material Adverse Change. Since December 31, 1998 there
has been no change in the business, Property, condition (financial or
otherwise) or results of operations of the Company and its Subsidiaries
taken as a whole, including, without limitation, the Acquired Business,
which could reasonably be expected to have a Material Adverse Effect.
4.6 Taxes. The Company and its Subsidiaries have filed all
United States federal tax returns and all other tax returns which are
required to be filed and have paid all taxes due pursuant to said returns
or pursuant to any assessment received by the Company or any of its
Subsidiaries, except such taxes, if any, as are not yet due and payable
or are being contested in good faith and as to which adequate reserves
have been provided in accordance with Agreement Accounting Principles.
The United States income tax returns of the Company and its Subsidiaries
have been audited by the Internal Revenue Service through the fiscal
year ended December 31, 1994. No tax liens have been filed and no
claims are being asserted with respect to any such taxes. The charges,
accruals and reserves on the books of the Company and its Subsidiaries in
respect of any taxes are adequate in accordance with Agreement
Accounting Principles.
4.7 Litigation and Contingent Obligations. Except as set
forth on Schedule 4.7, there is no litigation, arbitration, governmental
investigation, proceeding or inquiry pending or, to the knowledge of
any of their officers, threatened against or affecting the Company or
any of its Subsidiaries which could reasonably be expected to have a
Material Adverse Effect or which seeks to prevent, enjoin or delay the
making of any Loans. Other than any liability incident to any
litigation, arbitration or proceeding which (i) could not reasonably
be expected to have a Material Adverse Effect or (ii) is set forth on
Schedule 4.7, the Company and its Subsidiaries have no material
contingent obligations not provided for or disclosed in the financial
statements referred to in Section 4.4.
4.8 Subsidiaries. Schedule 4.8 contains an accurate list of
all Subsidiaries of the Company as of the date of this Agreement after
giving effect to the PSD Acquisition, setting forth their respective
jurisdictions of organization and the percentage of their respective
Equity Interests owned by the Company or other Subsidiaries. All of the
issued and outstanding Equity Interests of such Subsidiaries have been
(to the extent such concepts are relevant with respect to such ownership
interests) duly authorized and issued and are fully paid and
non-assessable.
4.9 ERISA. Except as could not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect:
there are no Unfunded Liabilities under any Single Employer Plans;
49
neither the Company nor any other member of the Controlled Group has
incurred, or is reasonably expected to incur, any withdrawal liability
to Multiemployer Plans; each Plan complies in all material respects with
all applicable requirements of law and regulations; no Reportable Event
has occurred with respect to any Plan; neither the Company nor any other
member of the Controlled Group has withdrawn from any Plan or initiated
steps to do so; and no steps have been taken to reorganize or terminate
any Plan.
4.10 Accuracy of Information. No information, exhibit or report
furnished by the Company or any of its Subsidiaries to the Agent or to any
Lender in connection with the negotiation of, or compliance with, the Loan
Documents contained any material misstatement of fact or omitted to
state a material fact or any fact necessary to make the statements
contained therein not materially misleading in a manner relied upon by
the Lenders to their detriment.
4.11 Regulation U. Neither the Company nor any of its Subsidiaries
is engaged in the business of extending credit for the purpose of
purchasing or carrying Margin Stock.
4.12 Material Agreements. Neither the Company nor any Subsidiary
is a party to any agreement or instrument or subject to any charter or
other corporate restriction which could reasonably be expected to have a
Material Adverse Effect. Neither the Company nor any Subsidiary is in
default in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any agreement (other
than agreements or instruments evidencing or governing Indebtedness) to
which it is a party, which default could reasonably be expected to
have a Material Adverse Effect.
4.13 Compliance With Laws. The Company and its Subsidiaries
have complied with all applicable statutes, rules, regulations, orders
and restrictions of any Governmental Authority having jurisdiction over
the conduct of their respective businesses or the ownership of their
respective Property, except for any failure to comply with any of the
foregoing which could not reasonably be expected to have a Material
Adverse Effect.
4.14 Ownership of Properties. Except as set forth on
Schedule 6.6, on the date of this Agreement, the Company and its
Subsidiaries will have good title, free of all Liens other than
those permitted by Section 6.6, to all of the Property and assets
reflected in the Company's most recent consolidated financial statements
provided to the Agent as owned by the Company and its Subsidiaries and
all other Property material to the Company's and its Subsidiaries'
businesses, except as sold or otherwise disposed of in the ordinary
course of business. The Company and each Subsidiary (i) owns and/or
50
possesses all the patents, trademarks, trade names, service marks,
copyrights, licenses and rights with respect to the foregoing necessary
for the present conduct of its business without any known conflict with
the rights of others, and (ii) owns and/or possesses and/or has applied
for all the patents, trademarks, trade names, service marks, copyrights,
licenses and rights with respect to the foregoing necessary for the
planned conduct of its business for the next six months, without any
known conflict with the rights of others, except, with respect to clauses
(i) and (ii), where the failure to own and/or possess any patents,
trademarks, trade names, service marks, copyrights, licenses and/or
rights could not reasonably be expected to have a Material Adverse Effect
and/or subject the Company or any Subsidiary to any material liability in
connection with any infringement and/or similar cause of action
related to any of the foregoing.
4.15 Plan Assets; Prohibited Transactions. The Company is not
an entity deemed to hold "plan assets" within the meaning of 29 C.F.R.
Sec. 2510.3-101 of an employee benefit plan (as defined in Section 3(3) of
ERISA) which is subject to Title I of ERISA or any plan (within the
meaning of Section 4975 of the Internal Revenue Code), and neither
the execution of this Agreement nor the making of Loans hereunder gives
rise to a prohibited transaction (within the meaning of Section 406 of
ERISA or Section 4975 of the Internal Revenue Code) with respect to "plan
assets" of the Company and its Subsidiaries.
4.16 Environmental Matters. In the ordinary course of its
business, the officers of the Company consider the effect of Environmental
Laws on the business of the Company and its Subsidiaries, in the course of
which they identify and evaluate potential risks and liabilities accruing
to the Company due to Environmental Laws. On the basis of this
consideration, the Company has concluded that Environmental Laws could
not reasonably be expected to have a Material Adverse Effect. Neither
the Company nor any Subsidiary has received any notice to the effect
that its operations are not in material compliance with any of the
requirements of applicable Environmental Laws or are the subject of any
investigation by any Governmental Authority evaluating whether any
remedial action is needed to respond to a release of any toxic or
hazardous waste or substance into the environment, which
non-compliance or remedial action could reasonably be expected to have
a Material Adverse Effect.
4.17 Investment Company Act. Neither the Company nor any
Subsidiary is an "investment company" or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act
of 1940, as amended.
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4.18 Public Utility Holding Company Act. Neither the Company
nor any Subsidiary is a "holding company" or a "subsidiary company" of a
"holding company", or an "affiliate" of a "holding company" or of a
"subsidiary company" of a "holding company", within the meaning of the
Public Utility Holding Company Act of 1935, as amended.
4.19 Year 2000. The Company has generally completed its
assessment of Year 2000 Issues and has a realistic program (the "Year
2000 Program") for completing required remediations and replacements of
its assets on a timely basis. The Company has identified significant
suppliers and is requesting information from them regarding the Year 2000
readiness of their products and services, but it has not, as of the date
hereof, received sufficient responses to ascertain that a material
adverse impact can be avoided as a result of the failure of such suppliers
to deliver products and services after December 31, 1999. Except as set
forth in the preceding sentence and for Year 2000 Issues affecting the
United States and international economies generally, based on its
assessment and Year 2000 Program the Company does not anticipate that
Year 2000 Issues will have a Material Adverse Effect.
4.20 Post-Retirement Benefits. As of the Closing Date, neither
the Company nor any of its Subsidiaries has any expected costs of
post-retirement medical and insurance benefits payable to their employees
and former employees, as estimated by the Company in accordance with
Financial Accounting Standards Board Statement No. 106.
4.21 Insurance. Schedule 4.21 accurately sets forth as of the
Closing Date all insurance policies and programs currently in effect with
respect to the respective properties and assets and business of the Company
and its Domestic Subsidiaries, specifying, for each such policy and program,
(i) the amount thereof, (ii) the risks insured against thereby, (iii) the
name of the insurer and each insured party thereunder, (iv) the policy or
other identification number thereof, (v) the expiration date thereof,
(vi) the annual premium with respect thereto, and (vii) any reserves
relating to any self-insurance program that is in effect.
4.22 The PSD Acquisition. As of the Closing Date and immediately
prior to the making of the initial Loans:
(a) the PSD Purchase Agreement is in full force and
effect, no material breach, default or waiver of any term or provision
of the PSD Purchase Agreement by the Company or any of its
Subsidiaries or, to the best of the Company's knowledge, the other
parties thereto has occurred (except for such breaches, defaults and
52
waivers, if any, consented to in writing by the Agent) and no action
has been taken by any competent Governmental Authority which
restrains, prevents or imposes any material adverse condition upon, or
seeks to restrain, prevent or impose any material adverse condition
upon, the PSD Acquisition;
(b) the representations and warranties of each of the
Company and, to the Company's knowledge, the Sellers (as defined in
the PSD Purchase Agreement) contained in the PSD Purchase Agreement
are true and correct in all material respects;
(c) except as set forth on Schedule 4.7, to the Company's
knowledge, there is no litigation, arbitration, governmental
investigation, proceeding or inquiry pending or threatened against
Pasteur Sanofi Diagnostics S.A. or any of its Subsidiaries which could
reasonably be expected to have a material adverse effect on the
business, Property, condition (financial or otherwise) or results of
operations of Pasteur Sanofi Diagnostics S.A. and its Subsidiaries,
taken as a whole; and
(d) all material conditions precedent to, and all material
consents and material regulatory approvals necessary to permit, the
PSD Acquisition pursuant to the PSD Purchase Agreement have been
satisfied or waived with the prior written consent of the Agent; but
for the payment of the purchase price, the PSD Acquisition has been
consummated or, concurrently with the transactions contemplated
hereby, will be consummated, in accordance with the PSD Purchase
Agreement and applicable law; the aggregate purchase price for the
Acquired Business under the PSD Purchase Agreement does not exceed the
equivalent of U.S. $210,000,000; and upon the payment of the purchase
price the Company will obtain good and marketable title to the
"Shares" (as defined in the PSD Purchase Agreement) free and clear of
any Liens other than Liens permitted under Section 6.6.
4.23 Solvency.
(a) Immediately after the consummation of the transactions to
occur on the date hereof and immediately following the making of each
Loan, if any, made on the date hereof and after giving effect to the
application of the proceeds of such Loans, (i) the fair value of the
assets of the Company and its Subsidiaries on a consolidated basis, at a
fair valuation, will exceed the debts and liabilities, subordinated,
contingent or otherwise, of the Company and its Subsidiaries on a
consolidated basis; (ii) the present fair saleable value of the Property
of the Company and its Subsidiaries on a consolidated basis will be
greater than the amount that will be required to pay the probable
liability of the Company and its Subsidiaries on a consolidated basis
on their debts and other liabilities, subordinated, contingent or
otherwise, as such debts and liabilities become absolute and matured;
(iii) the Company and its Subsidiaries on a consolidated basis will be
53
able to pay their debts and liabilities, subordinated, contingent or
otherwise, as such debts and liabilities become absolute and matured;
and (iv) the Company and its Subsidiaries on a consolidated basis will
not have unreasonably small capital with which to conduct the businesses
in which they are engaged as such businesses are now conducted and are
proposed to be conducted after the date hereof.
(b) The Company does not intend to, or to permit any of
its Subsidiaries to, and does not believe that it or any of its
Subsidiaries will, Incur debts beyond its ability to pay such debts as
they mature, taking into account the timing of and amounts of cash to
be received by it or any such Subsidiary and the timing of the amounts
of cash to be payable on or in respect of its Indebtedness or the
Indebtedness of any such Subsidiary.
SECTION 4A. REPRESENTATIONS AND WARRANTIES OF THE LENDERS
Each of the Lenders represents and warrants to the Company
that, at the time of execution hereof and on the Closing Date, the
following statements are true, correct and complete:
4A.1 Accredited Investor. Such Lender is an institutional
"accredited investor" within the meaning of Regulation D of the
Securities Act and the Notes to be acquired by it pursuant to this
Agreement are being acquired for its own account and without a view to,
or for resale in connection with, any distribution thereof or any
interest therein; provided that the provisions of this Section shall
not prejudice such Lender's right at all times to sell or otherwise
dispose of all or any part of the Notes so acquired pursuant to the
terms of this Agreement, a registration under the Securities Act or an
exemption from such registration available under the Securities Act.
4A.2 Knowledge and Experience. Such Lender has such
knowledge and experience in financial and business matters so as to be
capable of evaluating the merits and risks of its investment in the
Notes, such Lender is capable of bearing the economic risks of such
investment and such Lender has had the opportunity to conduct its own
due diligence investigation in relation to its making of the Loans and
the acquisition of the Notes hereunder.
4A.3 Source of Funds. No part of the funds used by such
Lender to make the Loans hereunder constitutes assets of any "plan"
(as defined in Section 4975 of the Internal Revenue Code).
54
SECTION 5. AFFIRMATIVE COVENANTS
The Company covenants and agrees that, until the Loans and
the Notes and all other amounts due under this Agreement have been
indefeasibly paid in full, it shall perform all covenants in this
Section 5 required to be performed by it.
5.1 Financial Reporting. The Company will maintain, for
itself and each Subsidiary, a system of accounting established and
administered in accordance with generally accepted accounting
principles, and furnish to the Lenders:
(a) Within 100 days after the close of each of its Fiscal
Years, an unqualified (except for qualifications relating to changes
in accounting principles or practices reflecting changes in generally
accepted accounting principles and required or approved by the
Company's independent certified public accountants) audit report
certified by independent certified public accountants acceptable to
the Required Lenders, prepared in accordance with Agreement Accounting
Principles on a consolidated basis for itself and its Subsidiaries,
including balance sheets as of the end of such period, related profit
and loss and reconciliation of surplus statements, and a statement of
cash flows.
(b) Within 60 days after the close of the first three
quarterly periods of each of its Fiscal Years, for itself and its
Subsidiaries, consolidated unaudited balance sheets as at the close of
each such period and consolidated profit and loss and reconciliation
of surplus statements and a statement of cash flows for the period
from the beginning of such Fiscal Year to the end of such quarter, all
certified by its chief financial officer.
(c) As soon as available, but in any event within 90 days
after the beginning of each Fiscal Year of the Company, a copy of the
plan and forecast (including a projected consolidated balance sheet,
income statement and funds flow statement) of the Company and its
Subsidiaries for such Fiscal Year.
(d) Together with the financial statements required under
Sections 5.1(a) and (b), a compliance certificate in substantially the
form of Exhibit III signed by its Chief Financial Officer or Treasurer
showing the calculations necessary to determine compliance with this
Agreement and stating that no Default or Event of Default exists, or
if any Default or Event of Default exists, stating the nature and
status thereof.
55
(e) Within 270 days after the close of each Fiscal Year, a
statement of the Unfunded Liabilities of each Single Employer Plan,
certified as correct by an actuary enrolled under ERISA.
(f) As soon as possible and in any event within 20 days
after the Company knows that any Reportable Event has occurred with
respect to any Plan, a statement, signed by the Chief Financial
Officer or Treasurer of the Company, describing said Reportable Event
and the action which the Company proposes to take with respect
thereto.
(g) As soon as possible and in any event within 20 days
after receipt by the Company, a copy of (a) any notice or claim to the
effect that the Company or any of its Subsidiaries is or may be liable
to any Person as a result of the release by the Company, any of its
Subsidiaries, or any other Person of any toxic or hazardous waste or
substance into the environment, and (b) any notice alleging any
violation of any federal, state or local environmental, health or
safety law or regulation by the Company or any of its Subsidiaries,
which, in either case, could reasonably be expected to have a Material
Adverse Effect.
(h) Promptly upon the furnishing thereof to the
shareholders of the Company, copies of all financial statements,
reports and proxy statements so furnished.
(i) Promptly upon the filing thereof, copies of all
registration statements and annual, quarterly, monthly or other
regular reports which the Company or any of its Subsidiaries files
with the Securities and Exchange Commission.
(j) Such other information (including non-financial
information) as the Agent or any Lender may from time to time
reasonably request.
5.2 Use of Proceeds. The Company will, and will cause
each Subsidiary to, use the proceeds of the Loans in accordance
with Section 2.6. The Company will not, nor will it permit any
Subsidiary to, use any of the proceeds of the Loans to purchase or
carry any Margin Stock.
5.3 Notice of Default. The Company will give prompt
notice in writing to the Lenders of the occurrence of any Default or
Event of Default and of any other development, financial or
otherwise (including, without limitation, developments with respect
to Year 2000 Issues), which could reasonably be expected to have a
Material Adverse Effect.
56
5.4 Conduct of Business. The Company will, and will cause
each Subsidiary to, carry on and conduct its business only in fields
of enterprise substantially the same as or reasonably related to the
fields of enterprise in which it is presently conducted (after giving
effect to the PSD Acquisition) and do all things necessary to remain
duly incorporated or organized, validly existing and (to the extent
such concept applies to such entity) in good standing as a domestic
corporation, partnership or limited liability company in its
jurisdiction of incorporation or organization, as the case may be,
and maintain all requisite authority to conduct its business in each
jurisdiction in which its business is conducted, in each case, except
to the extent that a failure to do so could not reasonably be
expected to have a Material Adverse Effect.
5.5 Taxes. The Company will, and will cause each Subsidiary
to, timely file complete and correct United States federal, if
applicable, and applicable foreign, state and local tax returns
required by law and pay when due all taxes, assessments and governmental
charges and levies upon it or its income, profits or Property which
if unpaid might become a Lien on any of its Property, except those which
are being contested in good faith by appropriate proceedings and with
respect to which adequate reserves have been set aside if and to the
extent required by Agreement Accounting Principles.
5.6 Insurance. The Company shall maintain for itself and
its Domestic Subsidiaries, or shall cause each of its Domestic
Subsidiaries to maintain, in full force and effect the insurance
policies and programs listed on Schedule 4.21 or substantially similar
policies and programs or other policies and programs as reflect
coverage that is reasonably consistent with prudent industry practice.
In the event the Company or any of its Domestic Subsidiaries, at any
time or times hereafter shall fail to obtain or maintain any of the
policies or insurance required herein or to pay any premium in whole
or in part relating thereto within ten days after written notice from
the Agent, then the Agent, without waiving or releasing any
obligations or resulting Event of Default hereunder, may at any time
or times thereafter so long as such failure shall continue (but shall
be under no obligation to do so) obtain and maintain such policies of
insurance and pay such premiums and take any other action with respect
thereto which the Agent deems advisable. All sums so disbursed by
the Agent shall constitute part of the Obligations, payable as
provided in this Agreement.
5.7 Compliance with Laws. The Company will, and will cause
each Subsidiary to, comply with all laws, rules, regulations, orders,
writs, judgments, injunctions, decrees or awards to which it may be
subject including, without limitation, all Environmental Laws, the
57
violation of which could reasonably be expected to have a Material
Adverse Effect and/or result in the creation of any Lien not
permitted by Section 6.6.
5.8 Maintenance of Properties. The Company will, and
will cause each Subsidiary to, do all things necessary and
commercially reasonable to maintain, preserve, protect and keep its
Property in good repair, working order and condition, ordinary wear
and tear excepted, and make all necessary and proper repairs,
renewals and replacements so that its business carried on in
connection therewith may be properly conducted at all times, in
each case except to the extent that a failure to do so could not
reasonably be expected to have a Material Adverse Effect.
5.9 Inspection. The Company will, and will cause each
Subsidiary to, permit the Agent and the Lenders, by their
respective representatives and agents, to inspect any of the
Property, books and financial records of the Company and each
Subsidiary, to examine and make copies of the books of accounts and
other financial records of the Company and each Subsidiary, and to
discuss the affairs, finances and accounts of the Company and each
Subsidiary with, and to be advised as to the same by, their respective
officers, in each case upon reasonable advance notice and at such
reasonable times (during normal business hours) and intervals as the
Agent may designate.
5.10 Year 2000. The Company will take and will cause each
of its Subsidiaries to take all such actions as are reasonably
necessary to successfully implement the Year 2000 Program and to assure
that Year 2000 Issues will not have a Material Adverse Effect. At the
request of the Agent, the Company will provide a description of the
Year 2000 Program, together with any updates or progress reports with
respect thereto.
5.11 Additional Guarantors. If at any time on or after the
Closing Date, any one or more Domestic Subsidiaries shall constitute
a Material Domestic Subsidiary, the Company shall promptly notify the
Agent thereof, which notice shall specify the date as of which such
Domestic Subsidiary or Subsidiaries became a Material Domestic Subsidiary.
(Each reference hereafter in this Section 5.11 to a Material Domestic
Subsidiary shall mean each Subsidiary constituting such Material Domestic
Subsidiary.) Within 90 days after the date specified in such notice,
the Company shall cause such Material Domestic Subsidiary to execute and
deliver to the Agent a Guaranty, together with such supporting
documentation, including corporate resolutions and/or opinions of
counsel with respect to such additional Guaranty, as may be reasonably
required by the Agent. Notwithstanding the foregoing, (i) if the Company
58
acquires a Material Domestic Subsidiary pursuant to a Permitted
Acquisition, the Company may, as an alternative to complying with the
preceding sentence, within 90 days after the consummation of such
Permitted Acquisition, cause such Material Domestic Subsidiary to merge
into, or to transfer all or substantially all of its assets to, the
Company or a Guarantor, and (ii) the Company shall comply with the
preceding sentence or, in the alternative, the preceding clause (i),
with respect to Sanofi Diagnostics Pasteur, Inc. and Genetic Systems
within 180 days after the Closing Date. In addition, if any Subsidiary
of the Company guarantees the obligations of the Company under the
Senior Secured Credit Agreement, such Subsidiary shall also deliver
a Guaranty to the Agent, together with such supporting documentation,
including corporate resolutions and/or opinions of counsel with respect
to such additional Guaranty, as may be reasonably required by the Agent.
5.12 Exchange of Rollover Bridge Notes. The Company will, on
or before the fifth Business Day following the written request (the
"Exchange Request") of the holder of any Rollover Bridge Note (or
beneficial owner of a portion thereof):
(a) Execute and deliver, cause each Guarantor to execute
and deliver, and cause a bank or trust company acting as trustee
thereunder to execute and deliver, the Senior Subordinated Indenture,
if such Senior Subordinated Indenture has not previously been executed
and delivered, and
(b) Execute and deliver to such holder or beneficial owner
in accordance with the Senior Subordinated Indenture a note in the
form attached to the Senior Subordinated Indenture (the "Exchange
Notes") bearing an increasing interest rate equal to the Rollover
Bridge Loan Rate in exchange for such Rollover Bridge Note dated the
date of the issuance of such Exchange Note, payable to the order of
such holder or owner, as the case may be, in the same principal amount
as such Rollover Bridge Note (or portion thereof) being exchanged, and
cause each Guarantor to endorse its guarantee thereon.
The Exchange Request shall specify the principal amount of
the Rollover Bridge Notes to be exchanged pursuant to this
Section 5.12 which shall be at least $5,000,000 and integral multiples
of $500,000 in excess thereof (or, in the case any Lender holds
Rollover Bridge Notes with an outstanding amount less than $5,000,000,
such remaining amount). Rollover Bridge Notes delivered to the
Company under this Section 5.12 in exchange for Exchange Notes shall
be cancelled by the Company and the corresponding amount of the
Rollover Bridge Loan deemed repaid and the Exchange Notes shall be
governed by and construed in accordance with the terms of the Senior
Subordinated Indenture.
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5.13 Permanent Securities.
(a) Upon the request of BOCM, the Company will issue
Permanent Securities in such amount as will generate gross proceeds
equal to an amount sufficient to repay all outstanding Bridge Notes,
Rollover Bridge Notes and Exchange Notes and all related fees and
expenses. Such securities shall have such form, term, guarantees,
covenants, default and subordination provisions and other terms as are
customary for securities of the type issued and may be issued in one
or more tranches, all as determined by BOCM, in its sole discretion.
BOCM will act as the exclusive managing underwriter, initial purchaser
or placement agent (as it shall determine in its sole discretion) and
ABN Amro Bank N.V. will act as the exclusive co-manager in connection
with such issuance of Permanent Securities pursuant to the provisions
of the Engagement Letter. The Company will do, and, to the extent
within its control, will cause the Target to do, all things reasonably
required in the opinion of BOCM, in connection with the sale of the
Permanent Securities. In addition, BOCM may require the Company to
execute an underwriting or purchase agreement providing for the
issuance of Permanent Securities contemplated by this Section 5.13
substantially in the form of BOCM's standard underwriting or purchase
agreement, modified as appropriate to reflect the terms of the
transactions contemplate thereby and containing such terms, covenants,
conditions, representations, warranties and indemnities as are
customary in similar transactions and providing for the delivery of
legal opinions, comfort letters and officers' certificates, all in
form and substance reasonably satisfactory to BOCM, as well as such
other terms and conditions as BOCM reasonably considers appropriate in
light of the then prevailing market conditions applicable to similar
financings.
(b) The Company will use its reasonable best efforts to
cause the Permanent Securities to be rated by two nationally
recognized statistical rating organizations (as such term is defined
in Rule 436(g)(2) under the Securities Act).
5.14 Lenders Meeting. The Company will participate in
a meeting with the Lenders once during each Fiscal Year to be held at
a location and a time selected by the Company and reasonably satisfactory
to the Lenders.
5.15 Note Documents. Each of the Company and the Guarantors
shall, on the date it executes and delivers any Note Document, have the
full corporate (or equivalent) power, authority and capacity to do so
and to perform all of its obligations to be performed thereunder; all
corporate (or equivalent) and other acts, conditions and things required
to be done and performed or to have occurred prior to such execution and
delivery to constitute them as valid and legally binding obligations of
the Company enforceable against the Company and the Guarantors in
60
accordance with their respective terms except to the extent that the
enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization or similar laws affecting the enforcement
of creditors' rights generally or by general principles of equity
(regardless of whether such enforcement is considered in a proceeding in
equity or at law), shall have been done and performed and shall have
occurred in due compliance with all applicable laws; on the date of such
execution and delivery by the Company and the Guarantors, each Note
Document shall constitute a legal, valid, binding and unconditional
obligation of the Company or the Guarantor, as the case may be,
enforceable against the Company or such Guarantors, as the case may be,
in accordance with its respective terms, except to the extent that the
enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization or similar laws affecting the enforcement of
creditors' rights generally or by general principles of equity
(regardless of whether such enforcement is considered in a proceeding
in equity or at law).
5.16 Syndication. The Company shall actively assist, and shall
use reasonable best efforts to cause the Target to actively assist,
FCCC and BOCM in achieving syndication of the Bridge Loan Commitment and
the Bridge Loan in a manner reasonably satisfactory to FCCC. In the event
that such syndication cannot be achieved in a manner reasonably
satisfactory to FCCC under the terms and conditions set forth herein, the
Company shall cooperate with FCCC in developing an alternative structure
that will permit syndication of the Bridge Loan Commitment and the Bridge
Loan in a manner reasonably satisfactory to FCCC and the Company.
Syndication of the Bridge Loan Commitment and the Bridge Loan will be
accomplished by a variety of means, including direct contact during the
syndication between senior management and advisors of the Company and the
Target and the proposed Lenders. To assist FCCC and BOCM in their
syndication efforts, the Company shall (a) provide and cause its advisors
and (to the extent subject to its control) the advisors of the Target to
provide FCCC and BOCM and the other Lenders upon request with all
information reasonably deemed necessary by FCCC and BOCM to complete
syndication, including but not limited to information and evaluations
prepared by the Company and the Target and their advisors, or on their
behalf, relating to the Transactions, provided that the Company does not
hereby waive its attorney-client privilege, (b) assist, and use
reasonable best efforts to cause the Target to assist, FCCC and BOCM
in the preparation of the Offering Memorandum described in Section
3.1(q) and (c) otherwise assist, and use reasonable best efforts to
cause the Target to assist, FCCC and BOCM in their syndication
efforts, including making available officers and advisors of the
Company and the Target from time to time to attend and make
61
presentations regarding the business and prospects of the Company and
the Target, as appropriate, at a meeting or meetings of prospective
Lenders.
It is understood and agreed that FCCC and BOCM, after
consultation with the Company, will manage and control all aspects of
the syndication, including decisions as to the selection of proposed
Lenders and any titles offered to proposed Lenders, when commitments
will be accepted and the final allocations of the commitments among
the Lenders. FCCC agrees to use its reasonable efforts to satisfy the
Company's preferences with respect to the selection of proposed
Lenders and the final allocation of the commitments among the Lenders.
SECTION 6. NEGATIVE COVENANTS
The Company covenants and agrees that until the satisfaction
in full of the Loans and the Notes and all other Obligations due under
this Agreement it will fully and timely perform all covenants in this
Section 6.
6.1 Dividends. The Company will not, nor will it permit
any Subsidiary to, declare or pay any dividends or make any distributions
on its capital stock (other than dividends payable in its own capital
stock) or redeem, repurchase or otherwise acquire or retire any of its
Equity Interests at any time outstanding, except that any Subsidiary
may declare and pay dividends or make distributions to the Company or
to a Wholly-Owned Subsidiary and excluding share repurchases of the
Company's capital stock used solely to fund employee stock purchase
plans and employee stock option plans, provided such share repurchases
do not exceed $5,000,000 in the aggregate in any fiscal year (including,
without limitation, the fiscal year ending December 31, 1999).
6.2 Indebtedness. The Company will not, nor will it permit
any Subsidiary to, Incur any Indebtedness, except:
(a) The Loans.
(b) Indebtedness under the Senior Secured Credit Agreement
in an amount not to exceed $220,000,000.
(c) Indebtedness (other than Indebtedness of Foreign
Subsidiaries) existing on the date hereof and described in Schedule
6.2.
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(d) Indebtedness arising under Rate Management
Transactions and other Financial Contracts permitted by Section 6.14.
(e) Indebtedness of Foreign Subsidiaries not exceeding
$30,000,000 (or equivalent in foreign currencies) in aggregate
principal amount at any one time outstanding prior to December 31,
1999 and $25,000,000 (or equivalent in foreign currencies) in
aggregate principal amount at any one time outstanding on or after
December 31, 1999.
(f) Factoring of accounts and notes receivable of Foreign
Subsidiaries, provided that (i) such receivables sold without recourse
to the selling Foreign Subsidiary shall be sold on commercially
reasonable terms and (ii) the liabilities of such Foreign Subsidiaries
with respect to such receivables sold with recourse to the selling
Foreign Subsidiary shall not exceed $10,000,000 (or equivalent in
foreign currencies) in the aggregate at any time.
(g) Indebtedness constituting Contingent Obligations
permitted by Section 6.13.
(h) Indebtedness incurred pursuant to so-called "synthetic
lease" transactions ("Synthetic Leases") and Sale and Leaseback
Transactions, provided that at the time such transaction is entered
into (A) no Default or Event of Default exists and (B) the Leverage
Ratio as of the last day of the most recent fiscal quarter for which
the Company has delivered financial statements pursuant to Section 5.1
on a pro forma basis as if such Synthetic Lease or Sale and Leaseback
Transaction were entered into at the beginning of the four-fiscal
quarter period ending on such day would have been equal to or less
than 3.00 to 1.
(i) Indebtedness of the Company to any Subsidiary or of
any Guarantor to the Company or any other Guarantor or of any
Subsidiary that is not a Guarantor to any other Subsidiary that is not
a Guarantor; provided that if the Company or any Guarantor is the
obligor on such Indebtedness, such Indebtedness shall be expressly
subordinate to the payment in full of the Obligations in a manner
satisfactory in form and substance to the Agent.
(j) Other Indebtedness, not otherwise permitted by clauses
(a) through (i) above, not exceeding $15,000,000 in the aggregate
outstanding at any one time.
6.3 Merger. The Company will not, nor will it permit any
Subsidiary to, merge or consolidate with or into any other Person,
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except that a Subsidiary may merge (i) into the Company or a
Wholly-Owned Subsidiary or (ii) in connection with a Permitted
Acquisition.
6.4 Sale of Assets. The Company will not, nor will it permit
any Subsidiary to, lease, sell or otherwise dispose of its Property to
any other Person, except:
(a) Sales of inventory in the ordinary course of business.
(b) Sales by Foreign Subsidiaries of accounts receivable
and notes receivable permitted by Section 6.2(f).
(c) Sales or other dispositions of Property in connection
with Synthetic Leases and Sale and Leaseback Transactions permitted by
Section 6.2(h).
(d) Equipment or other assets traded in or exchanged for
replacement assets.
(e) Leases, sales or other dispositions of its Property
(excluding leases, sales or other dispositions permitted under clauses
(a) through (d) above) that, together with all other Property of the
Company and its Subsidiaries previously leased, sold or disposed of as
permitted by this clause (e) during the four-fiscal quarter period
ending with the fiscal quarter in which any such lease, sale or other
disposition occurs, do not constitute a Substantial Portion of the
Property of the Company and its Subsidiaries, provided that during the
continuance of a Default or an Event of Default, any disposition of
Property constituting Collateral (as defined in the Senior Secured
Credit Agreement) pursuant to this clause (e) shall be for
consideration consisting only of cash and Cash Equivalent Investments.
6.5 Investments and Acquisitions. The Company will not,
nor will it permit any Subsidiary to, make or suffer to exist any
Investments (including without limitation, loans and advances to, and
other Investments in, Subsidiaries), or commitments therefor, or to
create any Subsidiary or to become or remain a partner in any partnership
or joint venture, or to make any Acquisition of any Person, except:
(a) Cash Equivalent Investments.
(b) Existing Investments in Subsidiaries and other
Investments in existence on the date hereof and described in Schedule
6.5.
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(c) Investments by the Company or any Guarantor in
Subsidiaries other than Guarantors, in addition to Investments
permitted by clause (b) above, not to exceed in the aggregate during
the term of this Agreement the sum of (i) $15,000,000 (or equivalent
in foreign currencies) plus (ii) the cumulative amount of repayments
of principal, returns of capital and dividends received by the Company
or any Guarantor from Subsidiaries other than Guarantors on
Investments (including existing Investments) in such Subsidiaries.
(d) Investments in the Company and in Subsidiaries that
are Guarantors, and Investments by Subsidiaries that are not
Guarantors in other Subsidiaries that are not Guarantors.
(e) Investments constituting Rate Management Transactions
and Financial Contracts permitted by Section 6.14.
(f) Permitted Acquisitions and Investments in joint
ventures, provided that no Default or Event of Default exists before
or after giving effect to such Permitted Acquisition or such joint
venture Investment.
(g) Other Investments not otherwise permitted by clauses
(a) through (f) above, not exceeding in the aggregate during the term
of this Agreement the sum of (i) $10,000,000 plus (ii) the cumulative
amount of repayments of principal, returns of capital and dividends
received by the Company or any Guarantor on Investments made pursuant
to this clause (g).
6.6 Liens. The Company will not, nor will it permit any
Subsidiary to, create, incur, or suffer to exist any Lien in, of or
on the Property of the Company or any of its Subsidiaries, except:
(a) Liens securing Indebtedness and other obligations
under the Senior Secured Credit Agreement.
(b) Liens for taxes, assessments or governmental charges
(other than Liens imposed by the PBGC) or levies on its Property if
the same shall not at the time be delinquent or thereafter can be paid
without penalty, or are being contested in good faith and by
appropriate proceedings and for which adequate reserves shall have
been set aside on its books if and to the extent required by Agreement
Accounting Principles.
(c) Liens imposed by law, such as carriers',
warehousemen's and mechanics' liens and other similar liens arising in
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the ordinary course of business which secure payment of obligations
not more than 60 days past due or which are being contested in good
faith by appropriate proceedings and for which adequate reserves shall
have been set aside on its books if and to the extent required by
Agreement Accounting Principles.
(d) Liens arising out of pledges or deposits under
worker's compensation laws, unemployment insurance, old age pensions,
or other social security or retirement benefits, or similar
legislation.
(e) Utility easements, building restrictions and such
other encumbrances or charges against real property as are of a nature
generally existing with respect to properties of a similar character
and which do not in any material way affect the marketability of the
same or interfere with the use thereof in the business of the Company
or its Subsidiaries.
(f) Liens granted to or for the benefit of any of the
agent or any lender under the Senior Secured Credit Agreement, or any
of their respective Affiliates, pursuant to any Rate Management
Transaction.
(g) Liens on property of Foreign Subsidiaries in
connection with banker's acceptances with maturities not in excess of
180 days.
(h) Liens on accounts and notes receivable of Foreign
Subsidiaries securing loans and advances to Foreign Subsidiaries
permitted by Section 6.2.
(i) Liens against equipment, property, or plant leased by
the Company or any Subsidiary in favor of the lessor thereof.
(j) Purchase money Liens to secure Indebtedness permitted
hereunder, and extensions, renewals and refinancing thereof so long as
the principal amounts thereof are not increased.
(k) Liens to secure the performance of tenders, statutory
obligations, bids, leases, government contracts, performance and
surety bonds and other similar obligations in the ordinary course of
business.
(l) Liens on documents and related property arising in
connection with trade letters of credit in the ordinary course of
business.
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(m) Liens (excluding liens permitted under clauses (a)
through (l) above) existing on the date hereof, the aggregate amount
of liabilities secured by which does not exceed $5,000,000. All such
Liens securing liabilities in excess of $250,000 are listed on
Schedule 6.6 hereto.
(n) Liens (excluding Liens permitted under clauses (a)
through (m) above) to secure obligations of the Company or any
Subsidiary, the principal amount of which does not exceed $15,000,000
at any one time.
6.7 Capital Expenditures. The Company will not, nor will
it permit any Subsidiary to, expend, or be committed to expend, in
excess of $40,000,000 for Capital Expenditures during any one Fiscal
Year, commencing with Fiscal Year 1999, in the aggregate for the Company
and its Subsidiaries on a consolidated basis; provided, however, that
for each Fiscal Year after 1999, such aggregate amount shall be increased
by an amount (the "Carryover Amount") that is the lesser of (i) the
excess, if any, of (A) the maximum aggregate amount of Capital
Expenditures (including any Carryover Amount) permitted pursuant to this
Section 6.7 for the immediately preceding fiscal year over (B) the
aggregate amount of actual Capital Expenditures during such preceding
Fiscal Year and (ii) $40,000,000. Notwithstanding the foregoing and
in addition thereto, the Company and its Subsidiaries may make Capital
Expenditures (1) in an amount equal to Available Net Cash Proceeds (as
defined in the Senior Secured Credit Agreement) in accordance with
Section 2.7.2(a) of the Senior Secured Credit Agreement and (2) in an
amount equal to Excess Cash Flow (as defined in the Senior Secured
Credit Agreement) on a cumulative basis to the extent not required
to be applied as a mandatory prepayment of the loans under the Senior
Secured Credit Agreement.
6.8 Limitation on Dividend and Other Payment Restrictions
Affecting Subsidiaries.
(a) The Company shall not (and shall not suffer or permit
any of its Domestic Subsidiaries to), directly or indirectly, enter
into any agreement with any Person which prohibits or limits the ability
of any of the Company or any of its Domestic Subsidiaries to create,
incur, assume or suffer to exist any Lien upon any of its Property or
revenues, whether now owned or hereafter acquired, other than (i) this
Agreement and the other Loan Documents, (ii) the Senior Secured Credit
Agreement, (iii) Lien restrictions in a Capitalized Lease or other
purchase money financing arrangement permitted hereunder relating to
the asset financed thereunder and (iv) purchase agreements, license
agreements, leases and other similar agreements entered into in the
ordinary course of business that prohibit a Lien on the asset or
assets subject to such agreements.
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(b) The Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, create, assume or suffer to
exist any consensual restriction on the ability of any of its
Subsidiaries to pay dividends or make other distributions to or on
behalf of, or to pay any obligation to or on behalf of, or otherwise
to transfer assets or Property to or on behalf of, or make or pay
loans or advances to or on behalf of, the Company or any of its
Subsidiaries, except:
(i) restrictions imposed by this Agreement and the
other Loan Documents;
(ii) restrictions imposed by the Senior Credit
Agreement;
(iii) restrictions imposed by applicable law;
(iv) existing restrictions under Indebtedness of any
Subsidiary outstanding on the Closing Date (after giving effect to the
PSD Acquisition);
(v) restrictions under any Acquired Indebtedness not
Incurred in violation of any agreement (including any Equity Interest)
relating to any Property, asset or business acquired by the Company or
any of its Subsidiaries, which restrictions in each case existed at
the time of the Acquisition, were not put in place in connection with
or in anticipation of such Acquisition and are not applicable to any
Person, other than the Person acquired, or to any Property, asset or
business, other than the Property, assets and business so acquired;
(vi) restrictions with respect solely to any of its
Subsidiaries imposed pursuant to a binding agreement which has been
entered into for the sale or disposition of all or substantially all
of the Equity Interests or assets of such Subsidiary; provided, that
such restrictions apply solely to the Equity Interests or assets of
such Subsidiary which are being sold;
(vii) restrictions on transfer contained in purchase
money Indebtedness; provided, that such restrictions relate only to
the transfer of the Property acquired with the proceeds of such
purchase money Indebtedness;
(viii) provisions with respect to the disposition or
distribution of assets or Property in joint venture agreements, asset
sale agreements, stock sale agreements and other similar agreements
entered into in the ordinary course of business;
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(ix) restrictions on cash or other deposits or net
worth imposed by customers under contracts entered into in the
ordinary course of business;
(x) in connection with and pursuant to permitted
Refinancings, replacements of restrictions imposed pursuant to clauses
(ii), (iv), (v) or (vii) above or this clause (ix) that are not more
restrictive taken as a whole than those being replaced and do not
apply to any other Person or assets than those that would have been
covered by the restrictions in the Indebtedness so Refinanced; and
(xi) restrictions contained in Indebtedness Incurred
by a Foreign Subsidiary in accordance with this Agreement; provided,
that such restrictions relate only to one or more Foreign
Subsidiaries.
Notwithstanding the foregoing, (A) customary provisions
restricting subletting or assignment of any lease entered into in the
ordinary course of business, consistent with industry practice and (B)
any asset subject to a Lien which is not prohibited to exist with
respect to such asset pursuant to the terms of this Agreement may be
subject to customary restrictions on the transfer or disposition
thereof pursuant to such Lien.
6.9 Affiliates. The Company will not, and will not permit
any Subsidiary to, enter into any transaction (including, without
limitation, the purchase or sale of any Property or service) with,
or make any payment or transfer to, any Affiliate (other than the
Company and its Wholly-Owned Subsidiaries) except in the ordinary
course of business and pursuant to the reasonable requirements of
the Company's or such Subsidiary's business and upon fair and
reasonable terms no less favorable to the Company or such Subsidiary
than the Company or such Subsidiary would obtain in a comparable
arms-length transaction.
6.10 Unfunded Liabilities. Except as could not reasonably
be expected, individually or in the aggregate, to have a Material
Adverse Effect, the Company will not permit any Unfunded Liabilities
to exist under any Plan.
6.11 Limitation on Modifications of Certain Documents. The
Company shall not, and shall not permit any of its Subsidiaries to, amend,
modify or waive, or permit the amendment, modification or waiver of,
any provision of any of the Related Documents.
6.12 Sale and Leaseback Transactions. The Company will not,
nor will it permit any Subsidiary to, enter into or suffer to exist any
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Sale and Leaseback Transaction other than Sale and Leaseback Transactions
and Synthetic Leases permitted by Section 6.2(h).
6.13 Contingent Obligations. The Company will not, nor will
it permit any Subsidiary to, make or suffer to exist any Contingent
Obligation (including, without limitation, any Contingent Obligation
with respect to the obligations of a Subsidiary), except (i) by
endorsement of instruments for deposit or collection in the ordinary
course of business, (ii) guaranties of Indebtedness permitted by
Section 6.2, (iii) guaranties by the Company or any Subsidiary of
employee credit card obligations in the ordinary course of business,
(iv) recourse obligations in connection with the factoring of accounts
and notes receivable of Foreign Subsidiaries, (v) guaranties and other
Contingent Obligations of the Company or any Subsidiary with respect
to obligations of any Subsidiary and (vi) other Contingent Obligations
not otherwise permitted by clauses (i) through (v) above not exceeding
$2,000,000 in the aggregate outstanding at any one time.
6.14 Financial Contracts. The Company will not, nor will it
permit any Subsidiary to, enter into or remain liable upon any
Financial Contract, except (i) Rate Management Transactions required
pursuant to the terms of the Senior Secured Credit Agreement and (ii)
other Financial Contracts pursuant to which the Company or any
Subsidiary has hedged its reasonably estimated interest rate,
foreign currency or commodity exposure.
6.15 Refinancing of the Loans in Part. The Company shall not,
nor shall the Company cause or permit any of its Subsidiaries to, Incur
any Indebtedness to Refinance the Loans in part other than the Permanent
Securities or the Exchange Notes.
6.16 Senior Subordinated Indebtedness. Neither the Company
nor any of the Guarantors shall, directly or indirectly, Incur any
Indebtedness (other than the Notes, the Exchange Notes, the Permanent
Securities and Indebtedness between the Company and its Wholly Owned
Subsidiaries) that is by its terms (or by the terms of any agreement
governing such Indebtedness) subordinated in right of payment to any
other Indebtedness of the Company or of such Guarantor unless such
Indebtedness is also by its terms (or by the terms of any agreement
governing such Indebtedness) made expressly subordinate to the Loans
and the Notes and the Guarantees to the same extent and in the same
manner as such Loans and Notes and Guarantees are subordinated to the
Senior Secured Credit Agreement.
6.17 Leverage Ratio.
(a) The Company will not permit the ratio, determined as of
the end of each of its fiscal quarters, of (i) Consolidated Funded
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Indebtedness to (ii) Consolidated EBITDA for the then most-recently
ended four fiscal quarters to be greater than 5.00 to 1.
(b) In the event that the Company or any Subsidiary shall
have consummated a Permitted Acquisition or Investment in a joint
venture during any four fiscal quarter period for which the Leverage
Ratio covenant contained in this Section 6.17 is calculated, the
Leverage Ratio shall be calculated as if such Permitted Acquisition or
Investment (including any Indebtedness Incurred in connection
therewith) had been consummated on the first day of such four fiscal
quarter period, provided that the Company shall not include such
Permitted Acquisition or Investment in the calculation of Consolidated
EBITDA, unless the Company shall have delivered to the Lenders, at or
prior to the time financial statements as of the last day of such four
fiscal quarter period are delivered to the Lenders pursuant to Section
5.1, audited financial statements of the acquired business or Person
or joint venture, as the case may be, stated in Dollars and presented
in conformity with GAAP, and covering the period from the first day of
such four fiscal quarter period to the actual date of the consummation
of such Permitted Acquisition or Investment.
ECTION 7. EVENTS OF DEFAULT
7.1 Events of Default. The occurrence of any one or more of
the following events shall constitute an Event of Default:
(a) Any representation or warranty made or deemed made by
or on behalf of the Company or any of its Subsidiaries to the Lenders
or the Agent under or in connection with this Agreement, any Loan, or
any certificate or information delivered in connection with this
Agreement or any other Loan Document shall be materially false on the
date as of which made.
(b) Nonpayment of principal of any Loan when due, or
nonpayment of interest upon any Loan or of any commitment fee or other
obligations under any of the Loan Documents within five days after the
same becomes due.
(c) The breach by the Company of any of the terms or
provisions of Section 5.2 or Section 6; or the breach by the Company
of any of the terms and conditions of Section 5.1, 5.3, 5.6 or 5.9
which is not remedied within ten days.
(d) The breach by the Company (other than a breach which
constitutes an Event of Default under another subsection of this
Section 7) of any of the terms or provisions of this Agreement or any
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other Loan Document which is not remedied within thirty days after
written notice from the Agent or the Required Lenders.
(e) (i) Failure of the Company or any of its Subsidiaries
to pay when due any Indebtedness (other than Indebtedness owing by the
Company to any Subsidiary or by any Subsidiary to the Company or
another Subsidiary and other than Rate Management Obligations)
outstanding in a principal amount aggregating in excess of $5,000,000
("Material Indebtedness"); or the default by the Company or any of its
Subsidiaries in the performance (beyond the applicable grace period
with respect thereto, if any) of any term, provision or condition
contained in any agreement under which any such Material Indebtedness
was created or is governed, or any other event shall occur or
condition exist, the effect of which default or event is to cause, or
to permit the holder or holders of such Material Indebtedness to
cause, such Material Indebtedness to become due prior to its stated
maturity; or any Material Indebtedness of the Company or any of its
Subsidiaries then outstanding in a principal amount in excess of
$2,500,000 shall be declared to be due and payable or required to be
prepaid or repurchased (other than by a regularly scheduled payment
and other than in connection with the refinancing of the Bridge Loan
with the proceeds of the Permanent Securities) prior to the stated
maturity thereof; or the Company or any of its Subsidiaries shall not
pay, or shall admit in writing its inability to pay, its debts
generally as they become due; or (ii) the occurrence of an early
termination under any Rate Management Transaction resulting from (A)
any event of default under such Rate Management Transaction as to
which the Company or any Subsidiary is the defaulting party or (B) any
termination event as to which the Company or any Subsidiary is an
affected party and, in either event, the termination value or other
similar obligation owed by the Company or such Subsidiary as a result
thereof is in excess of $5,000,000 and remains unpaid.
(f) The Company or any of its Material Subsidiaries shall
(i) have an order for relief entered with respect to it under the
Bankruptcy Law as now or hereafter in effect, (ii) make an assignment
for the benefit of creditors, (iii) apply for, seek, consent to, or
acquiesce in, the appointment of a receiver, custodian, trustee,
examiner, liquidator or similar official for it or any Substantial
Portion of its Property, (iv) institute any proceeding seeking an
order for relief under the Bankruptcy Law as now or hereafter in
effect or seeking to adjudicate it a bankrupt or insolvent, or seeking
dissolution, winding up, liquidation, reorganization, arrangement,
adjustment or composition of it or its debts under any Bankruptcy Law
or fail to file (by the deadline for such filing) an answer or other
pleading denying the material allegations of any such proceeding filed
against it, (v) take any corporate or partnership action to authorize
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or effect any of the foregoing actions set forth in this Section
7.1(f) or (vi) fail to contest in good faith and in a reasonably
timely manner any appointment or proceeding described in Section
7.1(g).
(g) Without the application, approval or consent of the
Company or any of its Material Subsidiaries, a receiver, trustee,
examiner, liquidator or similar official shall be appointed for the
Company or any of its Material Subsidiaries or any Substantial Portion
of its Property, or a proceeding described in Section 7.1(f)(iv) shall
be instituted against the Company or any of its Material Subsidiaries
and in each case such appointment continues undischarged or such
proceeding continues undismissed or unstayed for a period of 60
consecutive days.
(h) Any court, government or governmental agency shall
condemn, seize or otherwise appropriate, or take custody or control
of, all or any portion of the Property of the Company and its
Subsidiaries which, when taken together with all other Property of the
Company and its Subsidiaries so condemned, seized, appropriated, or
taken custody or control of, during the twelve-month period ending
with the month in which any such action occurs, constitutes a
Substantial Portion.
(i) The Company or any of its Subsidiaries shall fail
within 30 days to pay, bond or otherwise discharge one or more (i)
judgments or orders for the payment of money (except to the extent
covered by insurance as to which the insurer has not disclaimed
coverage) in excess of $5,000,000 (or the equivalent thereof in
currencies other than Dollars) in the aggregate, or (ii) nonmonetary
judgments or orders which, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect, which
judgment(s), in any such case, is/are not stayed on appeal or
otherwise being appropriately contested in good faith in a reasonably
timely manner.
(j) The Company or any other member of the Controlled
Group shall have been notified by the sponsor of a Multiemployer Plan
that it has incurred withdrawal liability to such Multiemployer Plan
in an amount which, when aggregated with all other amounts required to
be paid to Multiemployer Plans by the Company or any other member of
the Controlled Group as withdrawal liability (determined as of the
date of such notification), could reasonably be expected to have a
Material Adverse Effect.
(k) The Company or any other member of the Controlled
Group shall have been notified by the sponsor of a Multiemployer Plan
that such Multiemployer Plan is in reorganization or is being
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terminated, within the meaning of Title IV of ERISA, if as a result of
such reorganization or termination the aggregate annual contributions
of the Company and the other members of the Controlled Group (taken as
a whole) to all Multiemployer Plans which are then in reorganization
or being terminated have been or will be increased over the amounts
contributed to such Multiemployer Plans for the respective plan years
of each such Multiemployer Plan immediately preceding the plan year in
which the reorganization or termination occurs by an amount which
could reasonably be expected to have a Material Adverse Effect.
(l) The Company or any of its Subsidiaries shall (i) be
the subject of any order by any Governmental Authority or any judicial
determination of liability pertaining to the release by the Company,
any of its Subsidiaries or any other Person of any toxic or hazardous
waste or substance into the environment, or (ii) violate any
Environmental Law, which, in the case of an event described in clause
(i) or clause (ii), could reasonably be expected to have a Material
Adverse Effect, taking into account amounts to be paid by third
parties.
(m) Any Guarantor shall take any action to revoke or
discontinue or to assert the invalidity or unenforceability of any
Guarantee, or any Guarantor shall deny that it has any further
liability under any Guarantee to which it is a party, or shall give
notice to such effect.
7.2 Acceleration. If any Event of Default described in
Section 7.1(f) or 7.1(g) occurs with respect to the Company, the
obligations of the Lenders to make Loans hereunder shall automatically
terminate and the Obligations shall immediately become due and payable
without any election or action on the part of the Agent or any Lender.
If any other Event of Default occurs, the Required Lenders (or the
Agent with the consent of the Required Lenders) may terminate or
suspend the obligations of the Lenders to make Loans, or declare the
Obligations to be due and payable, or both, whereupon the Obligations
shall become immediately due and payable, without presentment, demand,
protest or notice of any kind, all of which the Company hereby
expressly waives.
If, within 30 days after acceleration of the maturity of the
Obligations or termination of the obligations of the Lenders to make
Loans hereunder as a result of any Event of Default (other than any
Event of Default as described in Section 7.1(f) or 7.1(g) with respect
to the Company) and before any judgment or decree for the payment of
the Obligations due shall have been obtained or entered, the Required
Lenders (in their sole discretion) shall so direct, the Agent shall,
by notice to the Company, rescind and annul such acceleration and/or
termination.
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SECTION 8. SUBORDINATION
8.1 Obligations Subordinated to Senior Debt of the Company.
The Lenders covenant and agree that payments of the Obligations by the
Company shall be subordinated in accordance with the provisions of
this Section 8 to the prior indefeasible payment in full, in cash or
Cash Equivalent Investments, of all amounts payable in respect of
Senior Debt of the Company, whether now outstanding or hereafter created,
that the subordination is for the benefit of the holders of Senior Debt
of the Company, and that each holder of Senior Debt of the Company
whether now outstanding or hereafter Incurred shall be deemed to have
acquired Senior Debt of the Company in reliance upon the covenants and
provisions contained in this Agreement.
8.2 Priority and Payment Over of Proceeds in Certain Events.
(a) Subordination on Dissolution, Liquidation or
Reorganization of the Company. Upon any payment or distribution of
assets or securities of the Company of any kind or character, whether
in cash, property or securities, upon any dissolution or winding up or
total or partial liquidation or reorganization of the Company, whether
voluntary or involuntary or in bankruptcy, insolvency, receivership or
other proceedings, all Senior Debt of the Company shall first be
indefeasibly paid in full in cash or Cash Equivalent Investments (or
such payment shall first be duly provided for to the satisfaction of
the holders of Senior Debt), before the Lenders shall be entitled to
receive any payment by the Company of any Obligations (other than
Junior Securities), and upon any such dissolution or winding up or
liquidation or reorganization, any payment or distribution of assets
or securities of the Company of any kind or character, whether in
cash, property or securities (other than Junior Securities), to which
the Lenders would be entitled except for the provisions of this
Section 8 shall be made by the Company or by any receiver, trustee in
bankruptcy, liquidating trustee, agent or other Person making such
payment or distribution, directly to the holders of the Senior Debt of
the Company or their representatives to the extent necessary to pay
all of the Senior Debt of the Company to the holders of such Senior
Debt of the Company.
(b) Subordination on Default on Senior Debt. Upon the
maturity of any Senior Debt of the Company by lapse of time,
acceleration or otherwise, all Senior Debt of the Company then due and
payable shall first be indefeasibly paid in full in cash or Cash
Equivalent Investments (or such payment shall first be duly provided
for to the satisfaction of the holders of Senior Debt), before any
payment is made by the Company or any Person acting on behalf of the
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Company with respect to the Obligations (other than Junior
Securities). No direct or indirect payment by the Company or any
Person acting on behalf of the Company of any Obligations whether
pursuant to the terms of the Loans or upon acceleration or otherwise
shall be made (other than Junior Securities), if at the time of such
payment, there exists a default (as defined in the document governing
any Senior Debt of the Company) in the payment of all or any portion
of any Senior Debt of the Company and such default shall not have been
cured or waived in writing or the benefits of this sentence waived in
writing by or on behalf of the holders of such Senior Debt. In
addition, during the continuation of any other event of default with
respect to the Senior Debt of the Company pursuant to which the
maturity thereof may be accelerated, upon the receipt by the Agent of
written notice from the Representative of the holders of such Senior
Debt, no such payment may be made by the Company upon or in respect of
the Obligations (other than Junior Securities), for a period (a
"Payment Blockage Period") commencing on the date of receipt of such
notice and ending 179 days after receipt of such notice (unless such
Payment Blockage Period shall be terminated by written notice to the
Agent from such Representative). Notwithstanding anything herein to
the contrary, (x) in no event will a Payment Blockage Period or
successive Payment Blockage Periods with respect to the same payment
on the Obligations extend beyond 179 days from the date the payment on
the Obligations was due and (y) only one such Payment Blockage Period
may be commenced within any 360 consecutive days. For all purposes of
this Section 8.2(b), no event of default which existed or was
continuing on the date of the commencement of any Payment Blockage
Period with respect to the Senior Debt of the Company initiating such
Payment Blockage Period shall be, or be made, the basis for the
commencement of a second Payment Blockage Period by the holders or by
the Representative of such Senior Debt whether or not within a period
of 360 consecutive days, unless such event of default shall have been
cured or waived for a period of not less than 90 consecutive days.
(c) Rights and Obligations of the Lenders. In the event
that, notwithstanding the foregoing provisions prohibiting such
payment or distribution, the Agent or any Lender shall have received
any payment on account of any Obligation (other than as permitted by
Sections (a) and (b) of this Section 8.2) at a time when such payment
is prohibited by this Section 8.2, then and in such event such payment
or distribution shall be received and held in trust for the
Representative of the holders of the Senior Debt of the Company and
shall be paid over or delivered to Representative of the holders of
the Senior Debt of the Company remaining unpaid to the extent
necessary to pay in full in cash or Cash Equivalent Investments all
Senior Debt of the Company in accordance with their terms after giving
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effect to any concurrent payment or distribution to the holders of
such Senior Debt of the Company.
If payment of the Obligations is accelerated because of an
Event of Default, the Company shall promptly notify the Representative
of the holders of Senior Debt of the Company of the acceleration. If
any Senior Debt is outstanding, the Company may not make any payment
on account of such accelerated Obligations until five Business Days
after such Representative receives notice of such acceleration and,
thereafter, may pay the Obligations only if this Section 8 otherwise
permits payment at that time.
Upon any payment or distribution of assets or securities
referred to in this Section 8, the Lenders (notwithstanding any other
provision of this Agreement) shall be entitled to rely upon any order
or decree of a court of competent jurisdiction in which such
dissolution, winding up, liquidation or reorganization proceedings are
pending, and upon a certificate of the receiver, trustee in
bankruptcy, liquidating trustee, agent or other Person making any such
payment or distribution, delivered to the Lenders for the purpose of
ascertaining the Persons entitled to participate in such distribution,
the holders of Senior Debt of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and
all other facts pertinent thereto or to this Section 8.
The Company shall give written notice to each of the Lenders
of any default or event of default under any Senior Debt of the
Company or under any agreement pursuant to which Senior Debt of the
Company may have been issued, and, in the event of any such event of
default, shall provide to the Agent the names and addresses of the
Representatives of holders of such Senior Debt of the Company.
With respect to the holders and owners of Senior Debt of the
Company, each Lender undertakes to perform only such obligations on
the part of such Lender as are specifically set forth in this
Section 8, and no implied covenants or obligations with respect to the
holders or owners of Senior Debt of the Company shall be read into
this Agreement against the Lenders. The Lenders shall not be deemed
to owe any fiduciary duty to the holders or owners of Senior Debt of
the Company or to the agent under the Senior Secured Credit Agreement
or any Representative of the holders of the Senior Debt of the
Company.
8.3 Payments May Be Paid Prior to Dissolution. Nothing
contained in this Section 8 or elsewhere in this Agreement shall
prevent or delay (a) the Company, except under the conditions
described in Section 8.2, from making payments at any time for the
purpose of paying Obligations, or from depositing with the Agent any
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moneys for such payments, or (b) subject to Section 8.2, the
application by the Agent of any moneys deposited with it for the
purpose of paying Obligations.
8.4 Rights of Holders of Senior Debt of the Company Not To
Be Impaired. No right of any present or future holder of any
Senior Debt of the Company to enforce subordination as provided in
this Section 8 shall at any time in any way be prejudiced or impaired
by any act or failure to act by any such holder (other than an express
waiver of subordination or an amendment of this Section 8.4), or by
any noncompliance by the Company with the terms and provisions and
covenants herein, regardless of any knowledge thereof any such holder
may have or otherwise be charged with. Without in any way limiting
the generality of the foregoing sentence, such holders of Senior Debt
of the Company may, at any time and from time to time without
impairing or releasing the subordination provided in this Section 8 or
the obligations of the Lender hereunder to the holders of Senior Debt
of the Company, do any one or more of the following: (a) change the
manner, place, terms or time of payment of, or renew or alter, Senior
Debt of the Company or otherwise amend or supplement in any manner
Senior Debt of the Company or any instrument evidencing the same or
any agreement under which any Senior Debt of the Company is
outstanding; (b) sell, exchange, release, or otherwise deal with any
property pledged, mortgaged, or otherwise securing Senior Debt of the
Company or fail to perfect or delay in the perfection of the security
interest in such property; (c) release any Person liable in any manner
for the collection of Senior Debt of the Company; and (d) exercise or
refrain from exercising any rights against the Company or any other
Person. Each Lender by purchasing or accepting a Note waives any and
all notice of the creation, modification, renewal, extension or
accrual of any Senior Debt of the Company and notice of or proof of
reliance by any holder or owner of Senior Debt of the Company upon
this Section 8 and the Senior Debt of the Company shall conclusively
be deemed to have been Incurred in reliance upon this Section 8, and
all dealings between the Company and the holders and owners of the
Senior Debt of the Company shall be deemed to have been consummated in
reliance upon this Section 8.
The provisions of this Section 8 are intended to be for the
benefit of, and shall be enforceable directly by, the holders of the
Senior Debt of the Company.
8.5 Subrogation. Upon the indefeasible payment in full in
accordance with the terms of Section 8.2 of all amounts payable under
or in respect of the Senior Debt of the Company, the Lenders shall be
subrogated to the rights of the holders of such Senior Debt of the
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Company to receive payments or distributions of assets of the Company
made on such Senior Debt of the Company until the Obligations shall
be paid in full in cash or Cash Equivalent Investments to the extent
set forth herein; and for purposes of such subrogation no payments or
distributions to holders of such Senior Debt of the Company of any
cash, property or securities to which the Lenders would be entitled
except for the provisions of this Section 8, and no payment over
pursuant to the provisions of this Section 8 to holders of such Senior
Debt of the Company by the Lenders, shall, as between the Company, its
creditors other than holders of such Senior Debt of the Company and
the Lenders, be deemed to be a payment by the Company to or on account
of such Senior Debt of the Company, it being understood that the
provisions of this Section 8 are solely for the purpose of defining
the relative rights of the holders of such Senior Debt of the Company,
on the one hand, and the Lenders, on the other hand. A release of any
claim by any holder of Senior Debt of the Company shall not limit the
Lenders' rights of subrogation under this Section 8.5.
If any payment or distribution to which the Lenders would
otherwise have been entitled but for the provisions of this Section 8
shall have been applied, pursuant to the provisions of this Section 8,
to the payment of all amounts payable under the Senior Debt of the
Company, then and in such case, the Lenders shall be entitled to
receive from the holders of such Senior Debt of the Company at the
time outstanding the amount of any such payments or distributions
received by such holders of Senior Debt of the Company in excess of
the amount sufficient to pay all Senior Debt of the Company payable
under or in respect of the Senior Debt of the Company in full in cash
or Cash Equivalent Investments in accordance with the terms of
Section 8.2.
8.6 Obligations of the Company Unconditional. Nothing
contained in this Section 8 or elsewhere in this Agreement is intended
to or shall impair as between the Company and the Lenders the
obligations of the Company, which are absolute and unconditional, to
pay to the Lenders the Obligations as and when the same shall become
due and payable in accordance with their terms, or is intended to or
shall affect the relative rights of the Lenders and creditors of the
Company other than the holders of the Senior Debt of the Company, nor
shall anything herein or therein prevent the Lenders from exercising
all remedies otherwise permitted by applicable law upon default under
this Agreement, subject to the rights, if any, under this Section 8 of
the holders of such Senior Debt of the Company in respect of cash,
property or securities of the Company received upon the exercise of
any such remedy.
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The failure to make a payment on account of Obligations by
reason of any provision of this Section 8 shall not prevent the
occurrence of an Event of Default under Section 7.
8.7 Lenders Authorize Agent To Effectuate Subordination. Each
Lender hereby authorizes and expressly directs the Agent on its behalf
to take such action as may be necessary or appropriate to effectuate
the subordination provided in this Section 8 and appoints the Agent
its attorney in fact for such purpose, including, without limitation,
in the event of any dissolution, winding up, liquidation or
reorganization of the Company (whether in bankruptcy, insolvency,
receivership, reorganization or similar proceedings or upon an
assignment for the benefit of creditors or any other similar remedy or
otherwise) tending towards liquidation of the business and assets of
the Company, the immediate filing of a claim for the unpaid balance of
the Obligations in the form required in said proceedings and causing
said claim to be approved or the actions required to negotiate and/or
effectuate a restructuring of the Indebtedness represented hereby. If
the Agent does not file a proper claim or proof of debt in the form
required in such proceeding prior to 30 days before the expiration of
the time to file such claim or claims, then the holders of the Senior
Debt of the Company are hereby authorized to have the right to file
and are hereby authorized to file an appropriate claim for and on
behalf of the Lenders. In the event of any such proceeding, until the
Senior Debt of the Company is paid in full in cash or Cash Equivalent
Investments, without the consent of the holders of a majority in
principal amount outstanding of Senior Debt of the Company, no Lender
shall waive, settle or compromise any such claim or claims relating to
the Obligations that such Lender now or hereafter may have against the
Company.
SECTION 9. THE AGENT
9.1 Appointment. Each Lender hereby irrevocably designates
and appoints Banc One Capital Markets, Inc. as Agent of such Lender to
act as specified herein and in the other Loan Documents, and each Lender
hereby irrevocably authorizes Banc One Capital Markets, Inc. as the
Agent to take such action on its behalf under the provisions of this
Agreement and the other Loan Documents and to exercise such powers and
perform such duties as are expressly delegated to the Agent by the terms
of this Agreement and the other Loan Documents, together with such other
powers as are reasonably incidental thereto. Notwithstanding any
provision to the contrary elsewhere in this Agreement or in any other
Loan Document, the Agent shall not have any duties or responsibilities,
except those expressly set forth herein or in the other Loan Documents,
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or any fiduciary relationship with any Lender, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or otherwise exist against the Agent. The
provisions of this Section 9 are solely for the benefit of the Agent
and the Lenders, and neither the Company nor any of its Subsidiaries
shall have any rights as a third party beneficiary of any of the
provisions hereof. In performing its functions and duties under this
Agreement and the other Loan Documents, the Agent shall act solely as
agent of the Lenders and the Agent does not assume and shall not be
deemed to have assumed any obligation or relationship of agent or
trust with or for the Company or any of its Subsidiaries.
9.2 Delegation of Duties. The Agent may execute any of its
duties under this Agreement or any other Loan Document by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Agent shall not
be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.
9.3 Exculpatory Provisions. The Agent shall not be (a)
liable for any action lawfully taken or omitted to be taken by it or
any Person described in Section 9.2 under or in connection with this
Agreement or the other Loan Documents (except for its or such Person's
own gross negligence or willful misconduct as finally determined by a
court of competent jurisdiction). (b) responsible in any manner to any
of the Lenders for any recitals, statements, representations or
warranties made by the Company or any of its Subsidiaries or any of
their respective officers contained in this Agreement, any other Loan
Document, or in any certificate, report, oral or written statement or
other document referred to or provided for in, or received by the Agent
under or in connection with, this Agreement or any other Loan Document,
(c) responsible in any manner to any of the Lenders for any failure of
the Company or any of its Subsidiaries or any of their respective
officers to perform its obligations hereunder or under any other Loan
Document, (d) responsible in any manner to any of the Lenders for the
effectiveness, genuineness, validity, enforceability, collectability
or sufficiency of this Agreement or any other Loan Document, (e)
required to ascertain or inquire as to the performance or observance
of any of the terms, conditions, provisions, covenants or agreements
contained herein or in any other Loan Document or as to the use of the
proceeds of the Loans or of the existence or possible existence of any
Default or Event of Default, or (f) required to inspect the
properties, books or records of the Company or any of its
Subsidiaries.
9.4 Reliance by Agent. The Agent shall be entitled to rely,
and shall be fully protected in relying, upon any note, writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, facsimile, telex or teletype message, statement,
81
order 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,
without limitation, counsel to the Company or any of its Subsidiaries),
independent accountants and other experts selected by the Agent. The
Agent may deem and treat the payee of any Note as the owner thereof
for all purposes unless the Agent shall have received an executed
assignment and assumption agreement pursuant to Section 13.1(a) in
respect thereof. The Agent shall be fully justified in failing or
refusing to take any action under this Agreement or any other Loan
Document unless it shall first receive such advice or concurrence of
the Required Lenders as it deems appropriate or it shall first be
indemnified to its satisfaction by the Lenders against any and all
liability and expense which may be incurred by it by reason of taking
or continuing to take any such action. The Agent shall in all cases
be fully protected in acting, or in refraining from acting, under this
Agreement and the other Loan Documents in accordance with a request of
the Required Lenders, and such request and any action taken or failure
to act pursuant thereto shall be binding upon all the Lenders.
9.5 Notice of Default. The Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Agent has received notice from a Lender or
the Company referring to this Agreement, describing such Default or Event
of Default and stating that such notice is a "notice of default." In
the event that the Agent receives such a notice, the Agent shall give
prompt notice thereof to the Lenders. The Agent shall take such action
with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders; provided, that unless and until the
Agent shall have received such directions, the Agent may (but shall not
be obligated to) take such action, or refrain from taking such action,
with respect to such Default or Event of Default as it shall deem
advisable in the best interests of the Lenders.
9.6 Non-Reliance on Agent and Other Lenders. Each Lender
expressly acknowledges that neither the Agent nor any of its respective
officers, directors, employees, agents, attorneys-in-fact or
affiliates has made any representations or warranties to it and that
no act by the Agent hereinafter taken, including any review of the
affairs of the Company or any of its Subsidiaries shall be deemed to
constitute any representation or warranty by the Agent. Each Lender
represents to the Agent that it has, independently and without
reliance upon the Agent or any other Lender, and based on such
documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, assets, operations,
property, financial and other condition, prospects and
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creditworthiness of the Company or its Subsidiaries and made its own
decision to make its Loans hereunder and enter into this Agreement.
Each Lender also represents that it will, independently and without
reliance upon the Agent or any other Lender, and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Agreement, and to make such
investigation as it deems necessary to inform itself as to the
business, assets, operations, property, financial and other condition,
prospects and creditworthiness of the Company and its Subsidiaries.
The Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business,
operations, assets, liabilities, property, prospects, financial and
other condition or creditworthiness of the Company or any of its
Subsidiaries which may come into the possession of the Agent or any of
its officers, directors, employees, agents, attorneys-in-fact or
affiliates.
9.7 Indemnification. The Lenders agree to indemnify the
Agent in its capacity as such and its officers, directors, employees,
representatives and agents ratably according to their respective
"percentages" as used in determining the Required Lenders at such
time, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever (including, without
limitation, the fees and disbursements of counsel for the Agent or
such Person in connection with any investigative, administrative or
judicial proceeding commenced or threatened, whether or not the Agent
or such Person shall be designated a party thereto) which may at any
time (including, without limitation, at any time following the payment
of the Obligations) be imposed on, incurred by or asserted against
the Agent or such Person in any way as a result of, relating to or by
reason of, or arising out of the execution, delivery or performance
of this Agreement or any other Loan Document, or any documents
contemplated by or referred to herein or the transactions contemplated
hereby of any action taken or omitted to be taken by the Agent under
or in connection with any of the foregoing, but only to the extent that
any of the foregoing is not paid by the Company or any of its
Subsidiaries; provided, that no Lender shall be liable to the Agent
or such Person for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting solely from the gross
negligence or willful misconduct of the Agent or such Person as
finally determined by a court of competent jurisdiction. If any
indemnity furnished to the Agent for any purpose shall, in the
opinion of the Agent, be insufficient or become impaired, the Agent
may call for additional indemnity and cease, or not commence, to do
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the acts indemnified against until such additional indemnity is
furnished. The agreements in this Section 9.7 shall survive the
payment of all Obligations.
9.8 Agent in Its Individual Capacity. The Agent and its
Affiliates may make loans to, accept deposits from and generally engage
in any kind of business with the Company and its Subsidiaries as though
the Agent were not the Agent hereunder. With respect to the Loans made
by it and all Obligations owing to it, the Agent shall have the same
rights and powers under this Agreement as any Lender and may exercise
the same as though it were not the Agent and the terms "Lender" and
"Lenders" shall include the Agent in its individual capacity.
9.9 Resignation of the Agent; Successor Agent. The Agent
may resign as the Agent upon 20 days' notice to the Lenders and the
Company. If the Agent shall resign as Agent under this Agreement and
the other Loan Documents, the Required Lenders shall appoint from among
the Lenders during such 20-day period a successor Agent which is a bank
or a trust company, whereupon such successor agent shall succeed to
the rights, powers and duties of the Agent, and the term "Agent" shall
mean such successor Agent effective upon its appointment, and the
resigning Agent's rights, powers and duties as the Agent shall be
terminated, without any other or further act or deed on the part
of such former Agent or any of the parties to this Agreement.
If the Required Lenders are not able to appoint a successor Agent during
such 20-day period, then the Required Lenders shall carry out the duties
of Agent under the provisions of this Agreement and the other Loan
Documents until a successor Agent is appointed. After the resignation
of the Agent hereunder, the provisions of this Section 9 and of Sections
13.2 and 13.3 shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Agent under this Agreement.
SECTION 10. GUARANTEE
10.1 Unconditional Guarantee. Each Guarantor hereby
unconditionally, jointly and severally, guarantees (such guarantee to be
referred to herein as the "Guarantee"), subject to Section 11, to each
of the Lenders and to the Agent and their respective successors and
assigns, that: (a) the principal of and interest on the Loans will be
promptly paid in full when due, subject to any applicable grace period,
whether at maturity, by acceleration or otherwise and interest on the
overdue principal, if any, and interest on any interest, to the extent
lawful, of the Loans and all other obligations of the Company to the
Lenders or the Agent hereunder or thereunder will be promptly paid in
full or performed, all in accordance with the terms hereof and thereof;
and (b) in case of any extension of time of payment or renewal of any
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of the Loans or of any such other obligations, the same will be promptly
paid in full when due or performed in accordance with the terms of the
extension or renewal, subject to any applicable grace period, whether
at stated maturity, by acceleration or otherwise, subject, however,
in the case of clauses (a) and (b) above, to the limitations set forth
in Section 10.5. Each Guarantor hereby agrees that its obligations
hereunder shall be unconditional, irrespective of the validity,
regularity or enforceability of the Loans or this Agreement, the
absence of any action to enforce the same, any waiver or consent by
any of the Lenders with respect to any provisions hereof or thereof,
the recovery of any judgment against the Company, any action to enforce
the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a Guarantor. Each Guarantor
hereby waives diligence, presentment, demand of payment, filing of claims
with a court in the event of insolvency or bankruptcy of the Company,
any right to require a proceeding first against the Company, protest,
notice and all demands whatsoever and covenants that this Guarantee
will not be discharged except by complete performance of the
obligations contained in the Loans, this Agreement and in this
Guarantee. If any Lender or the Agent is required by any court or
otherwise to return to the Company, any Guarantor, or any custodian,
trustee, liquidator or other similar official acting in relation to
the Company or any Guarantor, any amount paid by the Company or any
Guarantor to the Agent or such Lender, this Guarantee, to the extent
theretofore discharged, shall be reinstated in full force and effect.
Each Guarantor further agrees that, as between each Guarantor, on the
one hand, and the Lenders and the Agent, on the other hand, (x) the
maturity of the obligations guaranteed hereby may be accelerated as
provided in Section 7 for the purposes of this Guarantee,
notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the obligations guaranteed hereby, and
(y) in the event of any acceleration of such obligations as provided
in Section 7, such obligations (whether or not due and payable) shall
forthwith become due and payable by each Guarantor for the purpose of
this Guarantee.
10.2 Subordination of Guarantee. The obligations of each
Guarantor to the Lenders and to the Agent pursuant to the Guarantee of
such Guarantor and the other sections of this Agreement are expressly
subordinate and subject in right of payment to the prior payment in full
of all Guarantor Senior Debt of such Guarantor, to the extent and in the
manner provided in Section 11.
10.3 Severability. In case any provision of this Guarantee
shall be invalid, illegal or unenforceable, the validity, legality, and
enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
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10.4 Release of a Guarantor. Upon (a) the release by the
lenders under the Senior Secured Credit Agreement of all obligations
of a Guarantor under the Senior Secured Credit Agreement and all Liens
on the property and assets of such Guarantor relating to such
Indebtedness, or (b) the sale or disposition (whether by merger,
stock purchase, asset sale or otherwise) of a Guarantor (or all or
substantially all its assets) to an entity which is not a Subsidiary
of the Company and which sale or disposition is otherwise in compliance
with the terms of this Agreement, such Guarantor shall be deemed released
from all obligations under this Section 10 without any further action
required on the part of the Agent or any Lender; provided, however,
that any such termination shall occur only to the extent that all
obligations of such Guarantor under the Senior Secured Credit Agreement,
and under all of its pledges of assets or other security interests which
secure such Indebtedness, shall also terminate upon such release, sale or
transfer.
The Agent shall deliver an appropriate instrument evidencing
such release upon receipt of a request by the Company accompanied by
an Officers' Certificate certifying as to the compliance with this
Section 10.4. Any Guarantor not so released remains liable for the
Obligations as provided in this Section 10.
10.5 Limitation of Guarantor's Liability. Each Guarantor
and, by its acceptance hereof each of the Lenders, hereby confirms that
it is the intention of all such parties that this Guarantee not
constitute a fraudulent transfer or conveyance for purposes of any
Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar Federal or state law. To
effectuate the foregoing intention, the Lenders and such Guarantor hereby
irrevocably agree that the obligations of such Guarantor under the
Guarantee shall be limited to the maximum amount as will, after giving
effect to all other contingent and fixed liabilities of such Guarantor
(including, but not limited to, the Guarantor Senior Debt of such
Guarantor) and after giving effect to any collections from or payments
made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under its Guarantee or pursuant
to Section 10.7, result in the obligations of such Guarantor under the
Guarantee not constituting such fraudulent transfer or conveyance.
10.6 Guarantors May Consolidate, etc., on Certain Terms.
(a) Nothing contained in this Agreement or in the Loans
shall prevent any consolidation or merger of a Guarantor with or into
the Company or another Guarantor or shall prevent any sale or
conveyance of the Property of a Guarantor as an entirety or
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substantially as an entirety, to the Company or another Guarantor.
Upon any such consolidation, merger, sale or conveyance, the Guarantee
given by such Guarantor shall no longer have any force or effect.
(b) Except as set forth in Section 6.3, nothing contained
in this Agreement or in the Loans shall prevent any consolidation or
merger of a Guarantor with or into a corporation or corporations other
than the Company or another Guarantor (whether or not affiliated with
the Guarantor); provided, however, that, subject to Sections 10.4 and
10.6(a), (i) immediately after such transaction, and giving effect
thereto, no Default or Event of Default shall have occurred as a
result of such transaction and be continuing, and (ii) upon any such
consolidation, merger, sale or conveyance, the Guarantee of such
Guarantor set forth in this Section 10, and the due and punctual
performance and observance of all of the covenants and conditions of
this Agreement to be performed by such Guarantor, shall be expressly
assumed (in the event that the Guarantor is not the surviving
corporation in the merger), in writing satisfactory in form to the
Agent, executed and delivered to the Agent, by the corporation formed
by such consolidation, or into which the Guarantor shall have merged,
or by the corporation that shall have acquired such Property. In the
case of any such consolidation, merger, sale or conveyance and upon
the assumption by the successor corporation in writing executed and
delivered to the Agent and satisfactory in form to the Agent of the
due and punctual performance of all of the covenants and conditions of
this Agreement to be performed by the Guarantor, such successor
corporation shall succeed to and be substituted for the Guarantor with
the same effect as if it had been named herein as a Guarantor.
10.7 Contribution. In order to provide for just and equitable
contribution among the Guarantors, the Guarantors agree, inter se, that
in the event any payment or distribution is made by any Guarantor
(a "Funding Guarantor") under its Guarantee, such Funding Guarantor
shall be entitled to a contribution from all other Guarantors in a
pro rata amount based on the Adjusted Net Assets of each Guarantor
(including the Funding Guarantor) for all payments, damages and expenses
incurred by that Funding Guarantor in discharging the Company's obligations
with respect to the Obligations. "Adjusted Net Assets" of such Guarantor
at any date shall mean the lesser of (x) the amount by which the fair
value of the Property of such Guarantor exceeds the total amount of
liabilities, including, without limitation, contingent liabilities
(after giving effect to all other fixed and contingent liabilities
Incurred on such date (other than liabilities of such Guarantor under
Subordinated Indebtedness)), but excluding liabilities under the
Guarantee, of such Guarantor at such date and (y) the amount by which
the present fair salable value of the assets of such Guarantor at such
date exceeds the amount that will be required to pay the probable
liabilities of such Guarantor on its debts including, without
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limitation, Guarantor Senior Debt (after giving effect to all other
fixed and contingent liabilities Incurred on such date and after
giving effect to any collection from any Subsidiary of such Guarantor
in respect of the obligations of such Subsidiary under the Guarantee),
excluding debt in respect of the Guarantee of such Guarantor, as they
become absolute and matured.
10.8 Waiver of Subrogation. Until such time as all
Obligations on the Loans are paid in full, each Guarantor hereby
irrevocably waives any claim or other rights which it may now or
hereafter acquire against the Company that arise from the existence,
payment, performance or enforcement of such Guarantor's obligations
under its Guarantee and the other sections of this Agreement,
including, without limitation, any right of subrogation, reimbursement,
exoneration, indemnification, and any right to participate in any
claim or remedy of any Lender against the Company, whether or not
such claim, remedy or right arises in equity, or under contract,
statute or common law, including, without limitation, the right to
take or receive from the Company, directly or indirectly, in cash
or other Property or by set-off or in any other manner, payment or
security on account of such claim or other rights. If any amount
shall be paid to any Guarantor in violation of the preceding sentence
and the Loans shall not have been paid in full, such amount shall be
deemed to have been paid to such Guarantor for the benefit of, and
held in trust for the benefit of, the Lenders, and shall, subject to
the provisions of Section 8, Section 10.2 and Section 11, forthwith
be paid to the Agent for the benefit of such Lenders to be credited
and applied upon the Loans, whether matured or unmatured, in
accordance with the terms of this Agreement. Each Guarantor
acknowledges that it will receive direct and indirect benefits from
the financing arrangements contemplated by this Agreement and that
the waiver set forth in this Section 10.8 is knowingly made in
contemplation of such benefits.
10.9 Evidence of Guarantee. To evidence their guarantees
to the Lenders set forth in this Section 10, each of the Guarantors hereby
agrees to execute the notation of Guarantee in substantially the form
included in Exhibit VI. Each such notation of Guarantee shall be signed
on behalf of each Guarantor by two Officers, or an Officer and an
Assistant Secretary or one Officer shall sign and one Officer or an
Assistant Secretary (each of whom shall, in each case, have been duly
authorized by all requisite corporate actions) shall attest to such
notation of Guarantee.
10.10 Waiver of Stay, Extension or Usury Laws. Each
Guarantor covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, plead, or in any manner whatsoever
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claim or take the benefit or advantage of, any stay or extension law
or any usury law or other law that would prohibit or forgive such
Guarantor from performing its Guarantee as contemplated herein, wherever
enacted, now or at any time hereafter in force, or which may affect the
covenants or the performance of this Agreement; and (to the extent that
it may lawfully do so) each Guarantor hereby expressly waives all
benefit or advantage of any such law, and covenants that it will not
hinder, delay or impede the execution of any power herein granted to
the Agent, but will suffer and permit the execution of every such
power as though no such law had been enacted.
SECTION 11. SUBORDINATION OF GUARANTEE OBLIGATIONS
11.1 Guarantee Obligations Subordinated to Guarantor Senior
Debt. The Lenders covenant and agree that payments of the
obligations by a Guarantor in respect of its Guarantee (collectively,
as to any Guarantor, its "Guarantee Obligations") shall be
subordinated in accordance with the provisions of this Section 11 to
the prior indefeasible payment in full, in cash or Cash Equivalent
Investments, of all amounts payable in respect of Guarantor Senior
Debt of such Guarantor, whether now outstanding or hereafter created,
that the subordination is for the benefit of the holders of Guarantor
Senior Debt of such Guarantor, and that each holder of Guarantor
Senior Debt of such Guarantor whether now outstanding or hereafter
Incurred shall be deemed to have acquired Guarantor Senior Debt of
such Guarantor in reliance upon the covenants and provisions contained
in this Agreement.
11.2 Priority and Payment Over of Proceeds in Certain
Events.
(a) Subordination of Guarantee Obligations on Dissolution,
Liquidation or Reorganization of Such Guarantor. Upon any payment or
distribution of assets or securities of any Guarantor of any kind or
character, whether in cash, Property or securities, upon any
dissolution or winding up or total or partial liquidation or
reorganization of such Guarantor, whether voluntary or involuntary or
in bankruptcy, insolvency, receivership or other proceedings (other
than a liquidation or dissolution of such Guarantor into the Company
or another Guarantor), all Guarantor Senior Debt of such Guarantor
shall first be indefeasibly paid in full in cash or Cash Equivalent
Investments (or such payment shall first be duly provided for to the
satisfaction of the holders of Guarantor Senior Debt), before the
Lenders shall be entitled to receive any payment with respect to any
Guarantee Obligations of such Guarantor (other than Guarantor Junior
Securities), and upon any such dissolution or winding up or
liquidation or reorganization, any payment or distribution of assets
or securities (other than Guarantor Junior Securities) of such
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Guarantor of any kind or character, whether in cash, Property or
securities, to which the Lenders would be entitled except for the
provisions of this Section 11, shall be made by such Guarantor or by
any receiver, trustee in bankruptcy, liquidating trustee, agent or
other Person making such payment or distribution, directly to the
holders of the Guarantor Senior Debt of such Guarantor or their
representatives to the extent necessary to pay all of the Guarantor
Senior Debt of such Guarantor to the holders of such Guarantor Senior
Debt.
(b) Subordination of Guarantee Obligations on Default on
Guarantor Senior Debt. Upon the maturity of any Guarantor Senior Debt
of a Guarantor by lapse of time, acceleration or otherwise, all
Guarantor Senior Debt of such Guarantor then due and payable shall
first be indefeasibly paid in full in cash or Cash Equivalent
Investments (or such payment shall first be duly provided for to the
satisfaction of the holders of Guarantor Senior Debt), before any
payment is made by such Guarantor or any Person acting on behalf of
such Guarantor with respect to the Guarantee Obligations of such
Guarantor (other than Guarantor Junior Securities). No direct or
indirect payment by any Guarantor or any Person acting on behalf of
such Guarantor of any Guarantee Obligations of such Guarantor whether
pursuant to the terms of the Loans or upon acceleration or otherwise
shall be made (other than Guarantor Junior Securities), if at the time
of such payment, there exists a default (as defined in the document
governing any Guarantor Senior Debt of such Guarantor) in the payment
of all or any portion of any Guarantor Senior Debt of such Guarantor
and such default shall not have been cured or waived in writing or the
benefits of this sentence waived in writing by or on behalf of the
holders of such Guarantor Senior Debt. In addition, during the
continuation of any other event of default with respect to any
Guarantor Senior Debt of such Guarantor pursuant to which the maturity
thereof may be accelerated, upon the receipt by the Agent of written
notice from the Representative of the holders of such Guarantor Senior
Debt, no such payment may be made by such Guarantor under its
Guarantee (other than Guarantor Junior Securities) for a period (a
"Guarantor Payment Blockage Period") commencing on the date of receipt
of such notice and ending 179 days after receipt of such written
notice by the Agent (unless such Guarantor Payment Blockage Period
shall be terminated by written notice to the Agent from such
Representative). Notwithstanding anything herein to the contrary,
(x) in no event will a Guarantor Payment Blockage Period or successive
Guarantor Payment Blockage Periods with respect to the same payment on
such Guarantee extend beyond 179 days from the date the payment on
such Guarantee was due and (y) only one such Payment Blockage Period
may be commenced within any 360 consecutive days. For all purposes of
this Section 11.2(b), no event of default which existed or was
continuing on the date of the commencement of any Guarantor Payment
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Blockage Period with respect to the Guarantor Senior Debt initiating
such Guarantor Payment Blockage Period shall be, or be made, the basis
for the commencement of a second Guarantor Payment Blockage Period by
the holders or by the Representative of such Guarantor Senior Debt
whether or not within a period of 360 consecutive days, unless such
event of default shall have been cured or waived for a period of not
less than 90 consecutive days.
(c) Rights and Obligations of the Lenders. In the event
that, notwithstanding the foregoing provisions prohibiting such
payment or distribution, the Agent or any Lender shall have received
any payment on account of any Guarantee Obligation (other than as
permitted by Sections (a) and (b) of this Section 11.2) at a time when
such payment is prohibited by this Section 11.2, then and in such
event such payment or distribution shall be received and held in trust
for the Representative of the holders of the Guarantor Senior Debt and
shall be paid over or delivered to the Representative of the holders
of the Guarantor Senior Debt remaining unpaid to the extent necessary
to pay in full in cash or Cash Equivalent Investments all Guarantor
Senior Debt in accordance with their terms after giving effect to any
concurrent payment or distribution to the holders of such Guarantor
Senior Debt.
Nothing contained in this Section 11 will limit the right of
the Lenders to take any action to accelerate the maturity of the Loans
pursuant to Section 7 or to pursue any rights or remedies hereunder or
otherwise; provided, however, that if any Guarantor Senior Debt is
outstanding, no Guarantor shall make any payment on account of the
Guarantee Obligations until five Business Days after the
Representative of the holders of the Guarantor Senior Debt receives
notice of such acceleration and, thereafter, such Guarantor may pay
the Guarantee Obligations only if this Section 11 otherwise permits
payment at that time.
Upon any payment or distribution of assets or securities
referred to in this Section 11, the Lenders (notwithstanding any other
provision of this Agreement) shall be entitled to rely upon any order
or decree of a court of competent jurisdiction in which such
dissolution, winding up, liquidation or reorganization proceedings are
pending, and upon a certificate of the receiver, trustee in
bankruptcy, liquidating trustee, agent or other Person making any such
payment or distribution, delivered to the Lenders for the purpose of
ascertaining the Persons entitled to participate in such distribution,
the holders of Guarantor Senior Debt, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Section 11.
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The Guarantors shall give written notice to each of the
Lenders of any default or event of default under any Guarantor Senior
Debt or under any agreement pursuant to which Guarantor Senior Debt
may have been issued, and, in the event of any such event of default,
shall provide to the Agent the names and addresses of the
Representatives of holders of such Guarantor Senior Debt.
With respect to the holders and owners of Guarantor Senior
Debt, each Lender undertakes to perform only such obligations on the
part of the Lenders as are specifically set forth in this Section 11,
and no implied covenants or obligations with respect to the holders or
owners of Guarantor Senior Debt shall be read into this Agreement
against the Lenders. The Lenders shall not be deemed to owe any
fiduciary duty to the holders or owners of Guarantor Senior Debt or to
the agent under the Senior Secured Credit Agreement or any
Representative of the holders of the Guarantor Senior Debt.
11.3 Payments May Be Paid Prior to Dissolution. Nothing
contained in this Section 11 or elsewhere in this Agreement shall
prevent or delay (a) the Guarantors, except under the conditions
described in Section 11.2, from making payments at any time for the
purpose of paying Guarantee Obligations, or from depositing with the
Agent any moneys for such payments, or (b) subject to Section 11.2,
the application by the Agent of any moneys deposited with it for the
purpose of paying Guarantee Obligations.
11.4 Rights of Holders of Guarantor Senior Debt Not To Be
Impaired. No right of any present or future holder of any Guarantor
Senior Debt to enforce subordination as provided in this Section 11
shall at any time in any way be prejudiced or impaired by any act or
failure to act by any such holder (other than an express waiver of
subordination or an amendment of this Section 11.4), or by any
noncompliance by any Guarantor with the terms and provisions and
covenants herein, regardless of any knowledge thereof any such holder
may have or otherwise be charged with. Without in any way limiting
the generality of the foregoing sentence, such holders of Guarantor
Senior Debt may, at any time and from time to time without impairing
or releasing the subordination provided in this Section 11 or the
obligations of the Lenders hereunder to the holders of Guarantor
Senior Debt, do any one or more of the following: (a) change the
manner, place, terms or time of payment of, or renew or alter,
Guarantor Senior Debt or otherwise amend or supplement in any manner
Guarantor Senior Debt or any instrument evidencing the same or any
agreement under which any Guarantor Senior Debt is outstanding;
(b) sell, exchange, release, or otherwise deal with any property
pledged, mortgaged, or otherwise securing Guarantor Senior Debt or
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fail to perfect or delay in the perfection of the security interest in
such property; (c) release any Person liable in any manner for the
collection of Guarantor Senior Debt; and (d) exercise or refrain from
exercising any rights against the Guarantors or any other Person.
Each Lender by purchasing or accepting a Note waives any and all
notice of the creation, modification, renewal, extension or accrual of
any Guarantor Senior Debt and notice of or proof of reliance by any
holder or owner of Guarantor Senior Debt upon this Section 11 and the
Guarantor Senior Debt shall conclusively be deemed to have been
Incurred in reliance upon this Section 11, and all dealings between
the Guarantors and the holders and owners of the Guarantor Senior Debt
shall be deemed to have been consummated in reliance upon this
Section 11.
The provisions of this Section 11 are intended to be for the
benefit of, and shall be enforceable directly by, the holders of the
Guarantor Senior Debt.
11.5 Subrogation. Upon the indefeasible payment in full in
accordance with the terms of Section 11.2 of all amounts payable under or
in respect of the Guarantor Senior Debt, the Lenders shall be subrogated
to the rights of the holders of such Guarantor Senior Debt to receive
payments or distributions of assets of the Guarantors made on such
Guarantor Senior Debt until the Guarantee Obligations shall be paid
in full in cash or Cash Equivalent Investments to the extent set forth
herein; and for purposes of such subrogation no payments or distributions
to holders of such Guarantor Senior Debt of any cash, Property or
securities to which the Lenders would be entitled except for the
provisions of this Section 11, and no payment over pursuant to the
provisions of this Section 11 to holders of such Guarantor Senior Debt
by the Lenders, shall, as between such Guarantor, its creditors other
than holders of such Guarantor Senior Debt and the Lenders, be deemed
to be a payment by such Guarantor to or on account of such Guarantor
Senior Debt, it being understood that the provisions of this
Section 11 are solely for the purpose of defining the relative rights
of the holders of such Guarantor Senior Debt, on the one hand, and the
Lenders, on the other hand. A release of any claim by any holder of
Guarantor Senior Debt shall not limit the Lenders' rights of
subrogation under this Section 11.5.
If any payment or distribution to which the Lenders would
otherwise have been entitled but for the provisions of this Section 11
shall have been applied, pursuant to the provisions of this
Section 11, to the payment of all amounts payable under the Guarantor
Senior Debt, then and in such case, the Lenders shall be entitled to
receive from the holders of such Guarantor Senior Debt at the time
outstanding the amount of any payments or distributions received by
such holders of Guarantor Senior Debt in excess of the amount
sufficient to pay all Guarantor Senior Debt payable under or in
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respect of the Guarantor Senior Debt in full in cash or Cash
Equivalent Investments in accordance with the terms of Section 11.2.
11.6 Obligations of the Guarantors Unconditional. Nothing
contained in this Section 11 or elsewhere in this Agreement or in the
Guarantees is intended to or shall impair as between the Guarantors
and the Lenders the obligations of the Guarantors, which are absolute and
unconditional, to pay to the Lenders the Guarantee Obligations as and
when the same shall become due and payable in accordance with their
terms, or is intended to or shall affect the relative rights of the
Lenders and creditors of the Guarantors other than the holders of the
Guarantor Senior Debt, nor shall anything herein or therein prevent
the Lenders from exercising all remedies otherwise permitted by
applicable law upon default under this Agreement, subject to the
rights, if any, under this Section 11 of the holders of such
Guarantor Senior Debt in respect of cash, Property or securities of
the Guarantors received upon the exercise of any such remedy.
The failure to make a payment on account of Guarantee
Obligations by reason of any provision of this Section 11 shall not
prevent the occurrence of an Event of Default under Section 7.
11.7 Lenders Authorize Agent To Effectuate Subordination. Each
Lender hereby authorizes and expressly directs the Agent on its behalf
to take such action as may be necessary or appropriate to effectuate
the subordination provided in this Section 11 and appoints the Agent
its attorney in fact for such purpose, including, without limitation,
in the event of any dissolution, winding up, liquidation or
reorganization of any Guarantor (whether in bankruptcy, insolvency,
receivership, reorganization or similar proceedings or upon an
assignment for the benefit of creditors or any other similar remedy or
otherwise) tending towards liquidation of the business and assets of
any Guarantor, the immediate filing of a claim for the unpaid balance
of the Guarantee Obligations in the form required in said proceedings
and causing said claim to be approved or the actions required to
negotiate and/or effectuate a restructuring of the Guarantee
Obligations. If the Agent does not file a proper claim or proof of
debt in the form required in such proceeding prior to 30 days before
the expiration of the time to file such claim or claims, then the
holders of the Guarantor Senior Debt are hereby authorized to have the
right to file and are hereby authorized to file an appropriate claim
for and on behalf of the Lenders. In the event of any such
proceeding, until the Guarantor Senior Debt is paid in full in cash or
Cash Equivalent Investments, without the consent of the holders of a
majority in principal amount outstanding of Guarantor Senior Debt, no
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Lender shall waive, settle or compromise any such claim or claims
relating to the Obligations that such Lender now or hereafter may have
against the Guarantors.
SECTION 12. WARRANTS
Warrants to purchase up to an aggregate of 10% of the "fully
diluted" shares of the Common Stock of the Company will be executed,
issued and deposited into escrow pursuant to the Escrow Agreement.
The Warrants delivered into escrow shall be represented by a "Formula
Warrant Certificate" in the form attached to the Warrant Agreement.
The Formula Warrant Certificate will represent all Warrants that may
be released pursuant to this Section 12, after giving effect to any
previous release of Warrants. The parties hereto acknowledge and
agree that the aggregate number of shares of Common Stock represented
by Warrants released on any Warrant Release Date, plus the aggregate
number of shares of Common Stock represented by all previously
released Warrants, shall in no event exceed 10% of the Company's
"fully diluted" Common Stock as of the latest Warrant Release Date.
(a) Subject to the limitation set forth in the last
sentence of the preceding paragraph, Warrants representing the right
to purchase up to 10% of the Company's "fully-diluted" Common Stock
shall be released by the Escrow Agent on the applicable Warrant
Release Date to BOCM, pursuant to a Warrant Release Request delivered
by BOCM to the Escrow Agent and the Company at any time on or after
180 days following the Closing Date, for purposes of selling the
Permanent Securities. BOCM may not request the release of Warrants
from the escrow pursuant to this Section 12(a) unless BOCM determines
in good faith that such release is necessary in connection with such
sale of Permanent Securities. No other party, including the Lenders,
shall have any right to request the release of Warrants from escrow.
Warrants shall be released from escrow by the Escrow Agent pursuant to
this Section 12(a) in such names and denominations as BOCM may specify
pursuant to such Warrant Release Request.
(b) The "Applicable Number of Warrants" shall be released
by the Escrow Agent on the applicable Warrant Release Date to the
Lenders (or their designated Affiliates) pursuant to a Warrant Release
Request delivered by the Agent to the Escrow Agent and the Company.
Subject to the limitation set forth in the last sentence of the first
paragraph of this Section 12, the "Applicable Number of Warrants" for
any Warrant Release Date is equal to the product of (i) the percentage
set forth under column B below applicable to such Warrant Release Date
(based on the number of days elapsed from the Closing Date to such
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Warrant Release Date as specified in the corresponding column A
below), multiplied by (ii) 10% of the "fully diluted" shares of Common
Stock of the Company outstanding on such Warrant Release Date (as
certified in writing by the Company's Chief Financial Officer or
Treasurer).
A B
0 to 179 days 0.0%
180 to 269 days 25.0%
270 to 359 days 50.0%
360 to 449 days 75.0%
450 days and thereafter 100.0%
The aggregate amount of Warrants, if any, available to be issued to
the Lenders pursuant to this clause (b) shall be allocated among the
Lenders in accordance with the percentage that the outstanding
principal amount of Notes held by each Lender bears to the total
outstanding principal amount of all Notes held by all of the Lenders.
The Lenders will not be considered to be the beneficial owners of any
Warrants in escrow for any purpose until they are entitled to be
issued such Warrants pursuant to this clause (b), upon which event
they shall be reflected as the registered owners of Warrants on the
register maintained by the Company for such purpose pursuant to
Section 3 of the Warrant Agreement.
(c) Following the occurrence of the issuance of the
Permanent Securities (if such issuance occurs prior to the 450th day
following the Closing Date), any remaining Warrants to which the
Lenders are not entitled as set forth in clause (b) above shall be
returned to the Company for cancellation.
(d) Notwithstanding anything contained herein to the
contrary, the terms of this Section 12 shall survive the payment
and/or refinancing of the Bridge Notes and/or the termination of this
Agreement and shall remain operative and in full force and effect
until the conditions to return or release all of the Warrants as set
forth above have been satisfied.
SECTION 13. MISCELLANEOUS
13.1 Participations in and Assignments of Loans and Notes.
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(a) Each Lender shall have the right at any time to sell,
assign, transfer or negotiate all or any portion of its Notes or its
Loan Commitment in an aggregate amount of not less than $5,000,000 to
any Eligible Assignee, other than to an Eligible Assignee which has,
or has a Subsidiary which has, a principal line of business similar to
any principal line of business of the Company or any of its
Subsidiaries. In the case of any sale, transfer or negotiation of all
or part of the Notes or any Loan Commitment authorized under this
Section 13.1(a), the assignee, transferee or recipient shall become a
party to this Agreement as a Lender by execution of an assignment and
assumption agreement; provided that (i) at such time Section 2.1(a) or
2.2(a), as the case may be, shall be deemed modified to reflect the
Loan Commitment of such new Lender and of the existing Lenders,
(ii) upon surrender of the Notes, new Notes will be issued, at the
Company's expense, to such new Lender and to the assigning Lender,
such new Notes to be in conformity with the requirements of Section
2.1(d) or 2.2(c) as the case may be (with appropriate modifications)
to the extent needed to reflect the revised Loan Commitment, and
(iii) the Agent shall receive at the time of each such assignment,
from the assigning or assignee Lender, the payment of a non-refundable
assignment fee of $3,500; and provided, further, that such transfer or
assignment will not be effective until recorded by the Agent on the
Register pursuant to Section 13.20. To the extent of any assignment
pursuant to this Section 13.1(a), the assigning Lender shall be
relieved of its obligations hereunder with respect to its assigned
Loan Commitment, and the assignee, transferee or recipient shall have,
to the extent of such sale, assignment, transfer or negotiation, the
same rights, benefits and obligations as it would if it were a Lender
with respect to such Notes or Loan Commitment, including, without
limitation, the right to approve or disapprove actions which, in
accordance with the terms hereof, require the approval of a Lender.
At the time of each assignment pursuant to this Section 13.1(a) to an
Eligible Assignee which is not already a Lender hereunder and which is
not a United States Person (as such term is defined in Section
7701(a)(30) of the Internal Revenue Code) for Federal income tax
purposes, the respective Eligible Assignee shall provide to the
Company and the Agent the appropriate Internal Revenue Service Forms
described in Section 2.10(b).
(b) Each Lender may grant participations in all or any
part of its Notes or its Loan Commitment in an aggregate amount of not
less than $1,000,000 to any Eligible Assignee, other than to an
Eligible Assignee which has, or has a Subsidiary which has, a
principal line of business similar to any principal line of business
of the Company or any of its Subsidiaries; provided, however, 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 Company,
the Agent and the other Lenders shall continue to deal solely and
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directly with such Lender in connection with such Lender's rights and
obligations under the Agreement and such Lender shall retain the sole
right to enforce the obligations of the Company relating to the Loans
and to approve any amendment, modification or waiver of any provision
of this Agreement (other than amendments, modifications or waivers
with respect to any fees payable hereunder or the amount of principal
of or the rate at which interest is payable on the Loans, or the dates
fixed for payments of fees or principal of or interest on the Loans or
termination of the Loan Commitment).
(c) The Company shall, at its own cost and expense,
provide such certificates, acknowledgments and further assurances in
respect of this Agreement and the Loans as any Lender may reasonably
require in connection with any participation, transfer or assignment
pursuant to this Section 13.1.
(d) Nothing in this Agreement shall prevent or prohibit
any Lender from pledging its Loan and Notes hereunder to a Federal
Reserve Bank in support of borrowings made by such Lender from such
Federal Reserve Bank.
13.2 Expenses. Whether or not the transactions contemplated
hereby shall be consummated, the Company agrees to pay promptly upon
demand (a) all the actual and reasonable costs and expenses of
preparation of the Loan Documents and all the costs of furnishing all
opinions by counsel for the Company and the Guarantors (including
without limitation any opinions requested by the Lenders as to any
legal matters arising hereunder), and of the Company's and the
Guarantors' performance of and compliance with all agreements and
conditions contained herein on its part to be performed or complied
with; (b) the reasonable fees, expenses and disbursements of counsel
to the Lenders (including allocated costs of internal counsel) in
connection with the negotiation, preparation, execution and
administration of the Loan Documents and the Loans hereunder, and
any amendments, modifications and waivers hereto or thereto and
consents to departures from the terms hereof and thereof; and
(c) after the occurrence of an Event of Default, all costs and
expenses (including reasonable attorneys' fees, including allocated
costs of internal counsel, and costs of settlement) incurred by the
Lenders or the Agent in enforcing any Obligations of or in collecting
any payments due from the Company or any Guarantor hereunder or under
the Notes by reason of such Event of Default or in connection with any
refinancing or restructuring of the credit arrangements provided under
this Agreement in the nature of a "work-out" or of any insolvency or
bankruptcy proceedings.
13.3 Indemnity. In addition to the payment of expenses
pursuant to Section 13.2, whether or not the transactions contemplated
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hereby shall be consummated, the Company agrees to indemnify, pay and
hold each of the Lenders, the Agent and any holder of any of the Notes,
and each of their respective officers, directors, employees, agents,
representatives and affiliates (collectively called the "Indemnitees"),
harmless from and against any and all other liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, claims, costs,
expenses and disbursements of any kind or nature whatsoever (including,
without limitation, the reasonable fees and disbursements of counsel
for such Indemnitees in connection with any investigative,
administrative or judicial proceeding commenced or threatened, whether
or not such Indemnitee shall be designated as a party thereto), which
may be suffered by, imposed on, incurred by, or asserted against that
Indemnitee, in any manner resulting from, connected with, in respect
of, relating to or arising out of this Agreement, the other Loan
Documents and the Related Documents, the Commitment Letter, the Lenders'
agreements to make the Loans or the use or intended use of any of the
proceeds of the Loans hereunder, the issuance of the Exchange Notes or
the Permanent Securities or the PSD Acquisition (the "indemnified
liabilities"); provided, however, that the Company shall have no
obligation to an Indemnitee hereunder with respect to indemnified
liabilities (a) to the extent such liabilities are finally judicially
determined to have resulted solely from (i) the gross negligence or
willful misconduct of such Indemnitee or an affiliate of such
Indemnitee or (ii) the failure of such Indemnitee to perform its
obligations under any Loan Document or Related Document or (iii) such
Indemnitee's violation of law or (b) in connection with the
obligations of any Indemnitee under any Loan Document or Related
Document or for any transfer fees. To the extent that the undertaking
to indemnify, pay and hold harmless set forth in the preceding
sentence may be unenforceable because it is violative of any law or
public policy, the Company shall contribute the maximum portion which
it is permitted to pay and satisfy under applicable law to the payment
and satisfaction of all indemnified liabilities incurred by the
Indemnitees or any of them.
13.4 Setoff. Subject to Section 8, in addition to any rights
now or hereafter granted under applicable law and not by way of
limitation of any such rights, upon the occurrence and during the
continuance of any Event of Default or, after the Maturity Date, upon
all of the unpaid principal amount of and accrued interest on the Loans
becoming due and payable, each Lender, the Agent and each subsequent
holder of any Note is hereby authorized by the Company and each
Guarantor at any time or from time to time, without notice to the
Company or such Guarantor, or to any other Person, any such notice
being hereby expressly waived, to set off and to appropriate and to
apply any and all deposits (general or special, including, but not
limited to, Indebtedness evidenced by certificates of deposit,
whether matured or unmatured but not including trust accounts or any
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other accounts held for the benefit of another Person) and any other
Indebtedness at any time held or owing by such Person or any such
subsequent holder to or for the credit or the account of the Company
or such Guarantor against and on account of the obligations
and liabilities of the Company or such Guarantor to such Person or
such subsequent holder under this Agreement and the Notes, including,
but not limited to, all claims of any nature or description arising
out of or connected with this Agreement or the Notes, irrespective of
whether or not (a) such Person or such subsequent holder shall have
made any demand hereunder or (b) such Person or such subsequent holder
shall have declared the principal of or the interest on its portion of
the Loans and its Notes and other amounts due hereunder to be due and
payable as permitted by Section 7 and although said obligations and
liabilities, or any of them, may be contingent or unmatured.
13.5 Amendments and Waivers. No amendment, modification,
termination or waiver of any term or provision of this Agreement, of the
Notes or, prior to the execution and delivery thereof, of the form of the
Senior Subordinated Indenture or consent to any departure by the Company
or any Guarantor therefrom, shall in any event be effective without the
prior written concurrence of the Company or such Guarantor, as the case
may be, and the Required Lenders, and, upon the request of any Lender,
the receipt of a written opinion of counsel of the Company addressed to
the Lenders to the effect that such amendment, modification, termination,
waiver or consent does not violate or conflict with any of the terms
and provisions of the Senior Secured Credit Agreement or any other
indenture, lease or other agreement of the Company; provided, however,
that, notwithstanding the third sentence of Section 13.14, without the
prior written consent of each Lender affected, an amendment,
modification, termination or waiver of this Agreement, any Notes, any
Guarantee, or consent to departure from a term or provision hereof or
thereof may not: (a) reduce the principal amount of Notes whose
holders must consent to any such amendment, modification, termination,
waiver or consent; (b) reduce the rate of or extend the time for
payment of principal or interest on any Note; (c) reduce the principal
amount of any Note; (d) make any Note payable in money other than that
stated in the Note; (e) make any change in Section 13.5 or make any
change in or waive performance by the Company of its obligations under
Section 2.5(d) or in the definition of Change of Control; (f) reduce
the rate or extend the time of payment of fees or other compensation
payable to the Lenders hereunder; or (g) modify the provisions of
Section 8 or Section 11 or any of the defined terms related thereto in
any manner adverse to the Lenders; and provided, further, that without
the consent of the Agent, no such amendment, modification, termination
or waiver may amend, modify, terminate or waive any provision of
Section 9 as the same applies to the Agent or any other provision of
this Agreement as it relates to the rights or obligations of the
100
Agent. Any waiver or consent shall be effective only in the specific
instance and for the specific purpose for which it was given. No
notice to or demand on the Company or any Guarantor in any case shall
entitle the Company or such Guarantor to any further notice or demand
in similar or other circumstances. Any amendment, modification,
termination, waiver or consent effected in accordance with this
Section 13.5 shall be binding upon each holder of the Notes at the
time outstanding, each further holder of the Notes, and, if signed by
the Company or a Guarantor, on the Company and such Guarantor.
13.6 Independence of Covenants. All covenants hereunder
shall be given independent effect so that if a particular action or
condition is not permitted by any of such covenants, the fact that it
would be permitted by an exception to, or be otherwise within the
limitation of, another covenant shall not avoid the occurrence of a
Default or Event of Default if such action is taken or condition exists.
For the purpose of determining compliance with any covenant contained
herein, if an item meets the criteria of more than one type of exception
described in such covenants or the definitions used therein, the Company
or the Subsidiary in question shall have the right to determine in its
sole discretion the category to which such item applies and shall not be
required to include the amount and type of such item in more than one
of such categories and may elect to apportion such item between or
among two or more of such categories otherwise applicable.
13.7 Entirety. The Loan Documents, the Related Documents
and the Fee Letter embody the entire agreement of the parties and
supersede all prior agreements and understandings, if any, relating
to the subject matter hereof and thereof.
13.8 Notices. Unless otherwise provided herein, any notice
or other communications herein required or permitted to be given shall
be in writing and may be personally served, telecopied, telexed or sent
by mail and shall be deemed to have been given when delivered in person,
upon receipt of telecopy or telex against receipt of answer back or four
Business Days after depositing it in the mail, registered or certified,
with postage prepaid and properly addressed; provided, however, that
notices shall not be effective until received. For the purposes hereof,
the addresses of the parties hereto (until notice of a change thereof is
delivered as provided in this Section 13.8) shall be set forth under
each party's name on the signature pages hereto.
13.9 Survival of Warranties and Certain Agreements.
101
(a) All agreements, representations and warranties made
herein shall survive the execution and delivery of this Agreement, the
making of the Loans hereunder and the execution and delivery of the
Notes and, notwithstanding the making of the Loans, the execution and
delivery of the Notes or any investigation made by or on behalf of any
party, shall continue in full force and effect. The closing of the
transactions herein contemplated shall not prejudice any right of one
party against any other party in respect of anything done or omitted
hereunder or in respect of any right to damages or other remedies.
(b) Notwithstanding anything in this Agreement or implied
by law to the contrary, the agreements of the Company set forth in
Sections 13.2, 13.3, 13.13, 13.14, 13.16 and 13.19 shall survive the
payment of the Loans and the Notes and the termination of this
Agreement.
13.10 Failure or Indulgence Not Waiver; Remedies Cumulative.
No failure or delay on the part of the Agent or any Lender or any
holder of any Note in the exercise of any power, right or privilege
hereunder, under a Guarantee or under the Notes shall impair such power,
right or privilege or be construed to be a waiver of any default or
acquiescence therein, nor shall any single or partial exercise of any
such power, right or privilege preclude other or further exercise
thereof or of any other right, power or privilege. All rights and
remedies existing under this Agreement, under a Guarantee or the Notes
are cumulative to and not exclusive of any rights or remedies otherwise
available.
13.11 Severability. In case any provision in or obligation
under this Agreement, under a Guarantee or the Notes shall be invalid,
illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of
such provision or obligation in any other jurisdiction, shall not in
any way be affected or impaired thereby.
13.12 Headings. Section and Section headings in this
Agreement are included herein for convenience of reference only and
shall not constitute a part of this Agreement for any other purpose or
given any substantive effect.
13.13 Applicable Law. THIS AGREEMENT, INCLUDING EACH
GUARANTEE, AND THE NOTES SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED
AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
ILLINOIS AS APPLIED TO AGREEMENTS MADE AND PERFORMED WITHIN SUCH STATE
102
WITHOUT GIVING EFFECT TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF.
13.14 Successors and Assigns; Subsequent Holders of Notes.
This Agreement shall be binding upon the parties hereto and their
respective successors and assigns and shall inure to the benefit of
the parties hereto and the permitted successors and assigns of the
Lenders. The terms and provisions of this Agreement and each
Guarantee shall inure to the benefit of any assignee or transferee of
the Notes pursuant to Section 13.1(a), and in the event of such
transfer or assignment, the rights and privileges herein conferred
upon the Lenders shall automatically extend to and be vested in such
transferee or assignee, all subject to the terms and conditions
hereof. Except as provided in Section 13.5, in determining whether
the holders of a sufficient aggregate principal amount of the Loans
shall have consented to any action under this Agreement, any amount of
the Loans owned or held by the Company, any Guarantor or any of its
their respective Affiliates shall be disregarded. The Company's and
the Guarantors' rights or any interest therein hereunder may not be
assigned without the prior express written consent of each of the
Lenders.
13.15 Counterparts; Effectiveness. This Agreement and any
amendments, waivers, consents or supplements may be executed in any
number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be
deemed an original, but all such counterparts together shall constitute
but one and the same instrument. This Agreement shall become effective
upon the execution of a counterpart hereof by each of the parties hereto,
and delivery thereof to the Agent or, in the case of the Lenders, written
telex or facsimile notice or telephonic notification (confirmed in
writing) of such execution and delivery. The Agent will give the
Company and each Lender prompt notice of the effectiveness of this
Agreement.
13.16 Consent to Jurisdiction; Venue; Waiver of Jury
Trial.
(a) Any legal action or proceeding with respect to this
Agreement, any Note or any Guarantee may be brought in any Illinois
state court or any United States court sitting in Chicago, Illinois,
and, by execution and delivery of this Agreement, each of the parties
to this Agreement hereby irrevocably accepts for itself and in respect
of its respective property, generally and unconditionally, the
jurisdiction of the aforesaid courts. Each of the parties to this
Agreement hereby further irrevocably waives any claim that any such
courts lack jurisdiction over itself, and agrees not to plead or
claim, in any legal action or proceeding with respect to this
Agreement or the Notes brought in any of the aforesaid courts, that
103
any such court lacks jurisdiction over such party. Each of the
parties to this Agreement irrevocably consents to the service of
process in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to such
party, at its respective address for notices pursuant to Section 13.8,
such service to become effective 30 days after such mailing. To the
extent permitted by law, each of the parties to this Agreement hereby
irrevocably waives any objection to such service of process and
further irrevocably waives and agrees not to plead or claim in any
action or proceeding commenced hereunder or under any Note that
service of process was in any way invalid or ineffective. Nothing
herein shall affect the right of any party to this Agreement to serve
process in any other manner permitted by law or to commence legal
proceedings or otherwise proceed against any party in any other
jurisdiction.
(b) Each of the parties to this Agreement hereby
irrevocably waives any objection which it may now or hereafter have to
the laying of venue of any of the aforesaid actions or proceedings
arising out of or in connection with this Agreement or the Notes
brought in the courts referred to in clause (a) above and hereby
further irrevocably waives and agrees not to plead or claim in any
such court that any such action or proceeding brought in any such
court has been brought in an inconvenient forum.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY.
13.17 Payments Pro Rata.
(a) The Agent agrees that promptly after its receipt of
each payment of any interest or premium on or principal of the Notes
from or on behalf of the Company or any Guarantor, it shall, except as
otherwise provided in this Agreement, distribute such payment to the
Lenders (other than any Lender that has consented in writing to waive
its pro rata share of such payment) pro rata based upon their
respective pro rata shares, if any, of such payment.
(b) Each of the Lenders agrees that, if it should receive
any amount hereunder (whether by voluntary payment, by realization
upon security, by the exercise of the right of setoff or banker's
lien, by counterclaim or cross action, by the enforcement of any right
under the Loan Documents, or otherwise) which is applicable to the
payment of the principal of, or interest on, the Loans of a sum which
104
with respect to the related sum or sums received by other Lenders is
in a greater proportion than the total of such Obligations then owed
and due to such Lender bears to the total of such Obligations then
owed and due to all of the Lenders immediately prior to such receipt,
then such Lender receiving such excess payment shall purchase for cash
without recourse or warranty from the other Lenders an interest in the
Obligations of the Company to such Lenders in such amount as shall
result in a proportional participation by all of the Lenders in such
amount; provided that, if all or any portion of such excess amount is
thereafter recovered from such Lender, such purchase shall be
rescinded and the purchase price restored to the extent of such
recovery, but without interest.
13.18 Waiver of Stay, Extension or Usury Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at
any time insist upon, plead, or in any manner whatsoever claim or take
the benefit or advantage of, any stay or extension law or any usury law
or other law that would prohibit or forgive the Company from paying all
or any portion of the principal of or interest on the Loans as
contemplated herein, wherever enacted, now or at any time hereafter
in force, or which may affect the covenants or the performance of
this Agreement; and (to the extent that it may lawfully do so) the
Company hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Agent, but will suffer and
permit the execution of every such power as though no such law had been
enacted.
13.19 Confidentiality. Each Lender shall hold all non-public
information obtained pursuant to the requirements of or in connection with
this Agreement which has been identified as confidential by the Company in
accordance with such Lender's customary procedures for handling
confidential information of this nature and in accordance with safe and
sound banking practices, it being understood and agreed by the Company
that (a) in any event a Lender may make disclosures reasonably required
by any actual or prospective assignee, transferee or participant in
connection with the contemplated assignment or transfer by such Lender
of any Loans or any participation therein or as required or requested
by any governmental agency or representative thereof or pursuant to
legal process; provided that unless specifically prohibited by applicable
law or court order, each Lender shall notify the Company of any request by
any governmental agency or representative thereof (other than any such
request in connection with any examination of the financial condition
of such Lender by such governmental agency) for disclosure of any such
non-public information prior to disclosure of such information and
(b) a Lender may share with any of its Affiliates (that are not
competitors of the Company or any Subsidiary in any of their
respective lines of business), and such Affiliates may share with any
105
Lender (that is not a competitor of the Company or any Subsidiary in
any of their respective lines of business), any information related to
the Company or the Company's or their respective Affiliates (including
information relating to creditworthiness), the PSD Acquisition or the
financing therefor; and provided, further, that in no event shall any
Lender be obligated or required to return any materials furnished by
the Company or any of its Subsidiaries.
13.20 Register. The Company hereby designates the Agent
to serve as the Company's agent, solely for purposes of this Section
13.20, to maintain a register (the "Register") on which it will record the
Loans made by each of the Lenders and each repayment in respect of the
principal amount of the Loans of each Lender. Failure to make any such
recordation, or any error in such recordation shall not affect the
Company's obligations in respect of such Loans. With respect to any
Lender, the transfer of the Loan Commitments of such Lender and the
rights to the principal of, and interest on, any Loan made pursuant to
such Loan Commitments shall not be effective until such transfer is
recorded on the Register maintained by the Agent with respect to
ownership of such Loan Commitments and Loans and prior to such
recordation all amounts owing to the transferor with respect to such
Loan Commitments and Loans shall remain owing to the transferor.
The registration of assignment or transfer of all or part of any Loan
Commitments and Loans shall be recorded by the Agent on the Register
only upon the receipt by the Agent of a properly executed and delivered
assignment and assumption agreement pursuant to Section 13.1(a).
Coincident with the delivery of such an Assignment and Assumption
Agreement to the Agent for acceptance and registration of assignment
or transfer of all or part of a Loan, or as soon thereafter as
practicable, the assigning or transferor Lender shall surrender the
Note evidencing such Loan, and thereupon one or more new Notes of
the same type and in the same aggregate principal amount shall be
issued to the assigning or transferor Lender and/or the new Lender.
106
WITNESS the due execution hereof by the respective duly
authorized officers of the undersigned as of the date first written
above.
COMPANY:
BIO-RAD LABORATORIES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Treasurer
Notice Address:
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer (with
a copy to the General Counsel)
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
S-1
AGENT:
BANC ONE CAPITAL MARKETS,
INC., as Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Director
Notice Address:
▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
S-2
LENDERS:
Commitment: $80,000,000 FIRST CHICAGO CAPITAL
CORPORATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Director
Notice Address:
▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: L. ▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
S-3
Commitment: $20,000,000 ABN AMRO BANK N.V.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Senior Vice President
By: /s/ ▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇▇
Title: Senior Vice President
Notice Address:
ABN AMRO Bank N.V.
San ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
ABN AMRO Bank N.V.
Credit Administration
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
S-4
ANNEX I
Lending Offices
First Chicago Capital Corporation
▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: L. ▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Payment Instructions for Loans in US Dollars:
Fed ABA # ▇▇▇▇▇▇▇▇▇
Credit: LS2 Cash Account
Account # 4811 ▇▇▇▇▇▇▇▇
Reference: Bio-Rad
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
ABN AMRO Bank N.V.
Loan Administration
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Payment Instructions for Loans in US Dollars:
Pay to: ABN AMRO Bank N.V., New York
ABA: ▇▇▇▇▇▇▇▇▇
For credit to: ABN AMRO Bank N.V. - CPU
Account #: 650-001-1789-41
Reference: Bio-Rad Laboratories, Inc.