EXHIBIT 10.1
CREDIT AGREEMENT,
dated as of May 28, 1998,
among
▇▇▇▇▇▇▇▇▇ CORPORATION
as the Borrower,
and
CERTAIN COMMERCIAL LENDING INSTITUTIONS,
as the Lenders,
and
CANADIAN IMPERIAL BANK OF COMMERCE,
as the Administrative Agent for the Lenders
and
THE FIRST NATIONAL BANK OF CHICAGO,
as the Documentation Agent for the Lenders
Arranged By:
CIBC ▇▇▇▇▇▇▇▇▇▇▇
TABLE OF CONTENTS
PAGE
I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms...................................................................... 1
1.2. Use of Defined Terms............................................................... 22
1.3. Cross-References................................................................... 23
1.4. Accounting and Financial Determinations............................................ 23
II
COMMITMENTS, BORROWING PROCEDURES AND NOTES
2.1. Commitments..................................................................... 23
2.1.1. Term Loan Commitment........................................................... 23
2.1.2. Revolving Loan Commitment of Each Lender....................................... 24
2.1.3. Swing Loan Commitment.......................................................... 24
2.1.4. Lenders Not Permitted or Required To Make Loans................................ 24
2.2. Reduction of Commitment Amounts................... ............................. 25
2.2.1. Optional....................................................................... 25
2.2.2. Mandatory...................................................................... 25
2.2.3. Special Letter of Credit Provisions............................................ 26
2.3. Borrowing Procedure................................ ............................ 26
2.3.1. Revolving Loans and Term Loans................................................. 26
2.3.2. Swing Loans.................................................................... 27
2.4. Continuation and Conversion Elections........................................... 27
2.5. Funding......................................................................... 28
2.6. Notes........................................................................... 28
2.7. Letter of Credit Procedure...................................................... 28
2.8. Increase in Aggregate Revolving Loan Commitments
and/or Term Loan Commitment Amount.............................................. 30
2.9. Extension of Revolving Loan Stated Maturity Date................................ 31
III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
3.1. Repayments and Prepayments...................................................... 32
3.1.1. Payment Terms.................................................................. 32
3.1.2. Special Swing Loan Provisions.................................................. 34
3.1.3. Post Default Application of Payments........................................... 35
3.2. Interest Provisions............................................................. 36
3.2.1. Rates.......................................................................... 36
3.2.2. Post-Maturity Rates............................................................ 36
3.2.3. Payment Dates.................................................................. 36
3.3. Fees............................................................................ 37
3.3.1. Commitment Fee................................................................. 37
3.3.2. Upfront Fees................................................................... 37
3.3.3. Administrative Agent's Fee..................................................... 37
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3.3.4. Letter of Credit Fees............................................................. 37
3.4. Agreement to Repay Letter of Credit Drawings with Revolving Loans.................. 38
3.5. Letter of Credit Participations.................................................... 39
3.6. Existing Letters of Credit......................................................... 40
IV
CERTAIN EURODOLLAR RATE AND OTHER PROVISIONS
4.1. Eurodollar Rate Lending Unlawful................................................... 40
4.2. Deposits Unavailable............................................................... 41
4.3. Increased Costs, etc............................................................... 41
4.4. Funding Losses..................................................................... 42
4.5. Increased Capital Costs............................................................ 42
4.6. Taxes.............................................................................. 43
4.7. Payments, Computations, etc........................................................ 45
4.8. Sharing of Payments................................................................ 45
4.9. Setoff............................................................................. 46
4.10. Use of Proceeds.................................................................... 47
4.11. Discretion of Lenders as to Manner of Funding...................................... 47
4.12 Substitution....................................................................... 47
V
CONDITIONS TO BORROWING
5.1. Initial Borrowing.................................................................... 48
5.1.1. Resolutions, etc................................................................... 48
5.1.2. Delivery of Notes.................................................................. 49
5.1.3. Guaranty........................................................................... 49
5.1.4. Payment of Outstanding Indebtedness, etc........................................... 49
5.1.5. Security Agreement................................................................. 49
5.1.6. Consents, etc...................................................................... 50
5.1.7. Solvency........................................................................... 50
5.1.8. Opinions of Counsel................................................................ 50
5.1.9. Satisfactory Legal Form............................................................ 50
5.1.10. Closing Fees, Expenses, etc........................................................ 51
5.2. All Borrowings....................................................................... 51
5.2.1. Compliance with Warranties, No Default, etc........................................ 51
5.2.2. Borrowing Request.................................................................. 51
VI
REPRESENTATIONS AND WARRANTIES
6.1. Organization, etc.................................................................... 52
6.2. Due Authorization, Non-Contravention, etc............................................ 52
6.3. Government Approval, Regulation, etc................................................. 53
6.4. Validity, etc........................................................................ 53
6.5. Financial Information................................................................ 53
6.6. No Material Adverse Change........................................................... 53
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6.7. Litigation, Labor Controversies, etc.............................................. 53
6.8. Subsidiaries...................................................................... 54
6.9. Ownership of Properties........................................................... 54
6.10. Compliance........................................................................ 54
6.11. Taxes............................................................................. 55
6.12. Pension and Welfare Plans......................................................... 55
6.13. Environmental Warranties.......................................................... 55
6.14. Existing Subordinated Debt........................................................ 56
6.15. Regulations U and X............................................................... 56
6.16. Accuracy of Information........................................................... 56
VII
COVENANTS
7.1. Affirmative Covenants............................................................. 57
7.1.1. Financial Information, Reports, Notices, etc..................................... 57
7.1.2. Compliance with Laws, etc........................................................ 59
7.1.3. Maintenance of Properties........................................................ 60
7.1.4. Insurance........................................................................ 60
7.1.5. Books and Records................................................................ 60
7.1.6. Environmental Covenant........................................................... 60
7.1.7. Maintenance of Existence......................................................... 61
7.1.8. Accuracy of Information.......................................................... 61
7.1.9. Additional Guaranties and Collateral Documentation............................... 61
7.1.10. Leasehold Deeds of Trust......................................................... 61
7.1.11. Hazardous Materials Indemnity.................................................... 62
7.2. Negative Covenants................................................................ 62
7.2.1. Business Activities.............................................................. 63
7.2.2. Indebtedness..................................................................... 63
7.2.3. Liens............................................................................ 65
7.2.4. Financial Condition.............................................................. 66
7.2.5. Investments...................................................................... 67
7.2.6. Restricted Payments, etc......................................................... 68
7.2.7. Capital Expenditures............................................................. 69
7.2.8. Rental Obligations............................................................... 70
7.2.9. Consolidation, Merger, etc....................................................... 70
7.2.10. Asset Dispositions, etc.......................................................... 70
7.2.11. Modification of Certain Agreements............................................... 71
7.2.12. Transactions with Affiliates..................................................... 71
7.2.13. Negative Pledges, Restrictive Agreements, etc.................................... 72
VIII
EVENTS OF DEFAULT
8.1. Listing of Events of Default...................................................... 72
8.1.1. Non-Payment of Obligations....................................................... 72
8.1.2. Breach of Warranty............................................................... 72
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8.1.3. Non-Performance of Certain Covenants and Obligations............................. 73
8.1.4. Non-Performance of Other Covenants and Obligations............................... 73
8.1.5. Default on Other Indebtedness.................................................... 73
8.1.6. Judgments........................................................................ 73
8.1.7. Pension Plans.................................................................... 73
8.1.8. Control of the Borrower.......................................................... 74
8.1.9. Bankruptcy, Insolvency, etc...................................................... 74
8.1.10. Impairment of Security, etc...................................................... 75
8.1.11. Liens on Shares of Subsidiaries.................................................. 75
8.2. Action if Bankruptcy.............................................................. 75
8.3. Action if Other Event of Default.................................................. 75
IX
THE ADMINISTRATIVE AGENT
9.1. Actions........................................................................... 76
9.2. Funding Reliance, etc............................................................. 76
9.3. Exculpation....................................................................... 77
9.4. Successor......................................................................... 77
9.5. Credit Decisions.................................................................. 78
9.6. Copies, etc....................................................................... 78
X
MISCELLANEOUS PROVISIONS
10.1. Waivers, Amendments, etc.......................................................... 79
10.2. Notices........................................................................... 80
10.3. Payment of Costs and Expenses..................................................... 80
10.4. Indemnification................................................................... 81
10.5. Survival.......................................................................... 82
10.6. Severability...................................................................... 82
10.7. Headings.......................................................................... 83
10.8. Execution in Counterparts, Effectiveness, etc..................................... 83
10.9. Governing Law; Entire Agreement................................................... 83
10.10. Successors and Assigns............................................................ 83
10.11. Sale and Transfer of Loans and Notes; Participations in Loans and Notes........... 83
10.11.1. Assignments..................................................................... 83
10.11.2. Participations.................................................................. 85
10.12. Other Transactions................................................................ 86
10.13. Judgment Currency................................................................. 86
10.15. Waiver of Jury Trial.............................................................. 87
SECTION 10.16.
Confidentiality; Disclosure..................................................... 88
SCHEDULE I - Revolving, Term and Aggregate Percentages
SCHEDULE II - Disclosure Schedule
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SCHEDULE III- Guarantors
SCHEDULE IV - Existing Letters of Credit
EXHIBIT A - Form of Revolving Note
EXHIBIT B - Form of Term Note
EXHIBIT C - Form of Swingline Note
EXHIBIT D - Form of Borrowing Request
EXHIBIT E - Form of Continuation/Conversion Notice
EXHIBIT F - Form of Lender Assignment Agreement
EXHIBIT G - Form of Opinion of Counsel to the Borrower
EXHIBIT H - Form of Form of Guaranty
EXHIBIT I - Form of Security Agreement
EXHIBIT J - Form of Certificate of Solvency
vi
CREDIT AGREEMENT
This CREDIT AGREEMENT is dated as of May 28, 1998, among ▇▇▇▇▇▇▇▇▇
CORPORATION, a Delaware corporation (the "Borrower"), the various financial
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institutions as are or may become parties hereto as lenders(collectively, the
"Lenders"), CIBC INC. ("CIBC Inc."), as Swingline Lender, CANADIAN IMPERIAL BANK
-------- --------
OF COMMERCE ("CIBC"), as administrative agent for the Lenders (herein, in such
----
capacity, called the "Administrative Agent") and THE FIRST NATIONAL BANK OF
--------------------
CHICAGO, as documentation agent for the Lenders (herein, in such capacity, the
"Documentation Agent").
--------------------
W I T N E S S E T H:
WHEREAS, the Borrower desires to obtain Commitments from the Lenders
pursuant to which Loans and Letters of Credit, in a maximum aggregate principal
amount at any one time outstanding not to exceed $85,000,000 (subject to
increase pursuant to Section 2.8), will be made to the Borrower, or issued for
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the account of the Borrower or one or more of its Subsidiaries, from time to
time prior to the applicable Commitment Termination Date for such Commitments;
and
WHEREAS, the Lenders are willing, on the terms and subject to the
conditions hereinafter set forth (including Article V), to extend such
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Commitments and make such Loans to the Borrower and to issue Letters of Credit
for the account of the Borrower or one or more of its Subsidiaries; and
WHEREAS, the proceeds of such Loans will be used
(a) to make payment in full, concurrently with the initial Borrowing
hereunder, of all Indebtedness identified in Item 7.2.2(b) ("Indebtedness
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to be Paid") of the Disclosure Schedule; and
(b) for general corporate purposes, including working capital, capital
expenditures, refinancing, acquisitions and investments of the Borrower and
its Subsidiaries;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether or not
-------------
underscored) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise
requires, have the following meanings (such meanings to be equally applicable to
the singular and plural forms thereof):
"Administrative Agent" is defined in the preamble and includes each other
-------------------- --------
Person as shall have subsequently been appointed as the successor Administrative
Agent pursuant to Section 9.4.
-----------
"Affiliate" of any Person means any other Person which, directly or
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indirectly, controls, is controlled by or is under common control with such
Person (excluding any trustee under, or any committee with responsibility for
administering, any Plan). A Person shall be deemed to be "controlled by" any
other Person if such other Person possesses, directly or indirectly, power to
direct or cause the direction of the management and policies of such Person
whether by contract or otherwise.
"Aggregate Percentage" means, relative to any Lender, the percentage set
--------------------
forth opposite its name on Schedule I under the caption "Aggregate Percentage"
or as set forth in its Lender Assignment Agreement, as such percentage may be
adjusted from time to time pursuant to Section 2.8 or pursuant to Lender
-----------
Assignment Agreements executed by such Lender and its Assignee Lenders and
delivered pursuant to Section 10.11.
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"Agreement" means, on any date, this Credit Agreement as originally in
---------
effect on the Effective Date and as thereafter from time to time amended,
supplemented, amended and restated, or otherwise modified and in effect on such
date.
"Alternate Base Rate" means, on any date and with respect to all Base Rate
-------------------
Loans, a fluctuating rate of interest per annum equal to the higher of
(a) the rate of interest most recently announced by the
Administrative Agent at its Domestic Office as its reference rate; or
(b) the Federal Funds Rate most recently determined by the
Administrative Agent plus 50 basis points.
The Alternate Base Rate is not necessarily intended to be the lowest rate of
interest determined by the Administrative Agent or any other Lender in
connection with extensions of credit. Changes in the rate of interest on that
portion of any Loans maintained as Base Rate Loans will take effect
simultaneously with each change in the Alternate Base Rate. The Administrative
Agent will give notice promptly to the Borrower and the Lenders of changes in
the Alternate Base Rate.
2
"Applicable Base Rate Margin" is the rate per annum determined for Base
---------------------------
Rate Loans by reference to the definition of the term "Applicable Margin."
"Applicable Eurodollar Rate Margin" is the rate per annum determined for
---------------------------------
Eurodollar Rate Loans by reference to the definition of the term "Applicable
Margin."
"Applicable Margin" means, in the case of the Commitment Fee or any Base
-----------------
Rate Loan or Eurodollar Rate Loan, a rate per annum determined by reference to
the Borrower's Leverage Ratio as follows (expressed in basis points):
REVOLVING LOANS TERM LOANS
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APPLICABLE APPLICABLE APPLICABLE APPLICABLE
LEVERAGE BASE RATE EURODOLLAR BASE RATE EURODOLLAR COMMITMENT
RATIO MARGIN RATE MARGIN MARGIN RATE MARGIN FEE
---------------------------------------------------------------------------------------------------------
Less than
1.75 50.00 175.00 150.00 275.00 37.50
Greater than 75.00 200.00 150.00 275.00 37.50
or equal to
1.75, but
less than 2.25
Greater than 100.00 225.00 150.00 275.00 37.50
or equal to
2.25, but
less than 2.75
Greater than 125.00 250.00 150.00 275.00 50.00
or equal to
2.75, but
less than 3.25
3.25 or 150.00 275.00 175.00 300.00 50.00
greater
The "Applicable Margin"shall be adjusted on the first day of each January,
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April, July and October (or, if such day is not a Business Day, on the next
succeeding Business Day), based on the Leverage Ratio as of the last day of the
preceding Fiscal Quarter. If the Borrower should fail to deliver in a timely
manner a certificate required under Section 7.1.1(d) hereof, then, until the
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Borrower shall have provided such certificate, it shall be presumed that the
Leverage Ratio as of the end of the preceding Fiscal Quarter was greater than
3.25 (and, from the date of the delivery of such certificate, the Applicable
Margin for all Base Rate Loans and Eurodollar Rate Loans, and for the Commitment
Fee, shall be determined by reference to such certificate). Notwithstanding the
foregoing, from the Effective Date through October 31, 1998, it shall be
presumed that the
3
Leverage Ratio for such period was greater than 3.25, and on November 1, 1998,
the Applicable Margin shall be established based on the Leverage Ratio as of
July 31, 1998.
"Arranger" means CIBC ▇▇▇▇▇▇▇▇▇▇▇.
--------
"Assignee Lender" is defined in Section 10.11.1.
--------------- ---------------
"Authorized Officer" means, relative to any Obligor, those of its officers
------------------
whose signatures and incumbency shall have been certified to the Administrative
Agent and the Lenders pursuant to Section 5.1.1.
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"Base Rate Loan" means a Loan bearing interest at a fluctuating rate
--------------
determined by reference to the Alternate Base Rate.
"Bermite Development Agreement" means the Development Agreement by and
-----------------------------
among the Borrower, Whittaker Porta Bella (as successor in interest to ▇▇▇▇▇▇▇▇▇
Bermite Corporation) and Northholme Partners (as successor in interest to The
Anden Group) dated as of August 1, 1991, relating to the development of the
Bermite Land, as amended to date and as such agreement may hereafter be amended,
supplemented or otherwise modified from time to time.
"Bermite Land" means certain real property located in the city of Santa
------------
Clarita consisting of approximately 996 acres and owned by Whittaker Porta
Bella.
"Bermite/Santa Clarita Agreement" means the Development Agreement dated as
-------------------------------
of March 28, 1996 by and between the City of Santa Clarita and Whittaker Porta
Bella relating to the development of the Bermite Land.
"Borrower" is defined in the preamble.
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"Borrowing" means the Loans of the same Type made on the same Business Day
---------
and pursuant to the same Borrowing Request in accordance with Section 2.3.
-----------
"Borrowing Request" means a loan request and certificate duly executed by
-----------------
an Authorized Officer of the Borrower, substantially in the form of Exhibit D
---------
hereto.
"Business Day" means
------------
(a) any day which is neither a Saturday or Sunday nor a legal holiday
on which banks are authorized or required to be closed in New York, New
York; and
4
(b) which is, in addition to the requirements set forth in clause (a),
relative to the making, continuing, prepaying or repaying of any Eurodollar
Rate Loans, any day on which dealings in Dollars are carried on in the
London eurodollar interbank market.
"Capital Expenditures" means, for any period, the aggregate amount of (i)
--------------------
all expenditures of the Borrower and its Subsidiaries for fixed or capital
assets made during such period which, in accordance with GAAP, would be
classified as capital expenditures (including, without limitation, the aggregate
amount of all Capitalized Lease Liabilities incurred during such period) and
(ii) all consideration paid or Indebtedness assumed by the Borrower or its
Subsidiaries in connection with any acquisition of a business.
"Capitalized Lease Liabilities" means the amount of all monetary
-----------------------------
obligations of the Borrower or any of its Subsidiaries under any leasing or
similar arrangement which, in accordance with GAAP, would be classified as
capitalized leases, and, for purposes of this Agreement and each other Loan
Document, the stated maturity thereof shall be the date of the last payment of
rent or any other amount due under such lease prior to the first date upon which
such lease may be terminated by the lessee without payment of a penalty.
"Cash Equivalent Investment" means, at any time:
--------------------------
(a) any evidence of Indebtedness, maturing not more than one year
after such time, issued or guaranteed by the United States Government or
any state thereof;
(b) commercial paper, maturing not more than nine months from the
date of issue, which is issued by
(i) a corporation (other than an Affiliate of the Borrower)
organized under the laws of any state of the United States or of the
District of Columbia and, at the time of acquisition, rated A-l or
better by Standard & Poor's Corporation or P-l or better by ▇▇▇▇▇'▇
Investors Service, Inc., or
(ii) any Lender (or its holding company);
(c) any money market account, certificate of deposit, time deposit,
eurodollar time deposit or bankers acceptance, maturing not more than one
year after such time, which is issued by either
(i) a commercial banking institution that is a member of the
Federal Reserve System and has a combined
5
capital and surplus and undivided profits of not less than
$500,000,000, or
(ii) any Lender; or
(d) any repurchase or reverse repurchase agreement entered into with
any Lender (or other commercial banking institution of the stature referred
to in clause (c)(i))
-------------
(i) which is secured by a fully perfected security interest in
any obligation of the type described in any of clauses (a) through
-----------
(c); and
---
(ii) the security for which has a market value at the time such
repurchase agreement is entered into of not less than 100% of the
repurchase obligation of such Lender (or other commercial banking
institution) thereunder.
"CERCLA" means the Comprehensive Environmental Response, Compensation and
------
Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response Compensation
-------
Liability Information System List.
"Change in Control" means
-----------------
(a) the failure of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ to serve as the Chairman and
Chief Executive Officer of the Borrower at any time prior to the first
anniversary of the Effective Date, except in the event of death or
disability or termination "for cause" as determined by the Board of
Directors of the Borrower; or
(b) the acquisition by any Person, or two or more Persons acting in
concert, of beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission under the Securities Exchange Act of
1934) of 35% or more of the outstanding shares of voting stock of the
Borrower.
"CIBC" is defined in the preamble.
---- --------
"CIBC Inc." is defined in the preamble.
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"Code" means the Internal Revenue Code of 1986, as amended, reformed or
----
otherwise modified from time to time.
"Collateral" means, collectively, the property described as collateral in
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the Collateral Documents.
6
"Collateral Documents" means, collectively, the Security Agreement, the
--------------------
Leasehold Deeds of Trust, all collateral documentation executed pursuant to
Section 7.1.9 or otherwise to pledge property and interests as collateral
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security for the Obligations.
"Commitment" means, as the context may require, a Lender's Revolving Loan
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Commitment or Term Loan Commitment or the Swingline Lender's Swingline
Commitment.
"Commitment Amount" means, as the context may require, the Revolving Loan
-----------------
Commitment Amount, the Term Loan Commitment Amount or the Swing Loan Commitment
Amount.
"Commitment Fee" is defined in Section 3.3.1.
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"Commitment Termination Date" means, as the context may require, either the
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Revolving Loan Commitment Termination Date or the Term Loan Commitment
Termination Date.
"Commitment Termination Event" means
----------------------------
(a) the occurrence of any Event of Default described in Section
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8.1.9; or
(b) the occurrence and continuance of any other Event of Default and
either
(i) the declaration of the Loans to be due and payable pursuant
to Section 8.3, or
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(ii) in the absence of such declaration, the giving of written
notice by the Administrative Agent, acting at the direction of the
Required Lenders, to the Borrower that the Commitments have been
terminated.
"Contingent Liability" means any agreement, undertaking or arrangement by
--------------------
which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to, or otherwise to invest in, a
debtor, or otherwise to assure a creditor against loss) the indebtedness,
obligation or any other liability of any other Person (other than by
endorsements of instruments in the course of collection), or guarantees the
payment of dividends or other distributions upon the shares of any other Person,
including, without limitation, any "keep well" obligation or completion
guaranty. The amount of any Person's obligation under any Contingent Liability
shall (subject to any limitation set forth therein) be deemed to be the
outstanding principal amount (or maximum principal amount, if
7
larger) of the debt, obligation or other liability guaranteed thereby.
"Continuation/Conversion Notice" means a notice of continuation or
------------------------------
conversion and certificate duly executed by an Authorized Officer of the
Borrower, substantially in the form of Exhibit E hereto.
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"Controlled Group" means all members of a controlled group of corporations
----------------
and all members of a controlled group of trades or businesses (whether or not
incorporated) under common control which, together with the Borrower, are
treated as a single employer under Section 414(b) or 414(c) of the Code or
Section 4001 of ERISA.
"Default" means any Event of Default or any condition, occurrence or event
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which, after notice or lapse of time or both, would constitute an Event of
Default.
"Disclosure Schedule" means the Disclosure Schedule attached hereto as
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Schedule II, as it may be amended, supplemented or otherwise modified from time
-----------
to time by the Borrower with the written consent of the Majority Lenders.
"Documentation Agent" is defined in the preamble.
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"Dollar" and the sign "$" mean lawful money of the United States.
------ -
"Domestic Office" means, relative to any Lender, the office of such Lender
---------------
designated as such below its signature hereto or designated in the Lender
Assignment Agreement or such other office of a Lender (or any successor or
assign of such Lender) within the United States as may be designated from time
to time by written notice from such Lender, as the case may be, to each other
Person party hereto.
"EBITDA" means, for any period, without duplication, the net income of the
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Borrower and its consolidated Subsidiaries plus, to the extent deducted in
----
determining net income, the Borrower's and its consolidated Subsidiaries'
interest expense, income taxes, depreciation, amortization and other non-cash or
non-recurring expenses, minus, to the extent included in net income, any non-
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cash or non-recurring gains of the Borrower and its consolidated Subsidiaries,
and plus up to $2,000,000 of cash expenses associated with the disposition,
----
closure or liquidation of Aviant Information, Inc. EBITDA shall be calculated
(i) after giving pro forma effect to any acquisition or divestiture by the
Borrower or its Subsidiaries during such period and (ii) after excluding
▇▇▇▇▇▇▇▇▇ Communications and ▇▇▇▇▇▇▇▇▇ Power Storage from such calculation. For
the Fiscal Quarter ending July 31,
8
1998 only, EBITDA shall be calculated by multiplying year-to-date EBITDA by four
and dividing the resulting product by three. For all Fiscal Quarters ending on
and after October 31, 1998, EBITDA shall be calculated on a trailing four-
quarter basis at the end of each Fiscal Quarter.
"Effective Date" means the date on which the conditions to the initial
--------------
Borrowing shall have been satisfied or waived pursuant to Section 5.1.
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"Eligible Assignee" means (a) a financial institution organized under the
-----------------
laws of the United States, or any state thereof, and having a combined capital
and surplus of at least $100,000,000; (b) a commercial bank organized under the
laws of any other country which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a political subdivision of any such
country, and having a combined capital and surplus of at least $100,000,000,
provided that such bank is acting through a branch or agency located in the
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United States of America; (c) a Person that is engaged in the business of
commercial finance and that is (i) a Subsidiary of a Lender, (ii) a Subsidiary
of a Person of which a Lender is a Subsidiary, or (iii) a Person of which a
Lender is a Subsidiary or (d) any insurance company, mutual fund or other
financial institution or fund which has been approved in writing (or, in the
case of the Borrower, deemed approved as provided below) by the Borrower and the
Administrative Agent as an Eligible Assignee for purposes of this Agreement,
provided that in each such case such approval shall not be unreasonably
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withheld, and provided, further, that if the Borrower is requested in writing at
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any time to approve any Person as an Eligible Assignee hereunder and the
Administrative Agent has not received notice from the Borrower, within seven
Business Days after receipt by the Borrower of such request, that the Borrower
does not approve such Person as an Eligible Assignee, the Borrower shall be
deemed to have approved such Person as an Eligible Assignee.
"Environmental Action" means any administrative, regulatory or judicial
--------------------
action, suit, demand, demand letter, claim, notice of non-compliance or
violation, investigation, proceeding, consent order or consent agreement
relating in any way to any Environmental Law or any Environmental Permit
including, without limitation, (a) any claim by any governmental or regulatory
authority for enforcement, cleanup, removal, response, remedial or other actions
or damages pursuant to any Environmental Law and (b) any claim by any third
party seeking damages, contribution, indemnification, cost recovery,
compensation or injunctive relief resulting from Hazardous Materials or arising
from alleged injury or threat of injury to health, safety or the environment.
9
"Environmental Laws" means all applicable federal, state or local statutes,
------------------
laws, ordinances, codes, rules, regulations and guidelines (including consent
decrees and administrative orders) relating to public health and safety and
protection of the environment.
"Environmental Permit" means any permit, approval, identification number,
--------------------
license or other authorization required under any Environmental Law.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time. References
to sections of ERISA also refer to any successor sections.
"Eurodollar Office" means, relative to any Lender, the office of such
-----------------
Lender designated as such below its signature hereto or designated in the Lender
Assignment Agreement or such other office of a Lender as designated from time to
time by notice from such Lender to the Borrower and the Administrative Agent,
whether or not outside the United States, which shall be making or maintaining
Eurodollar Rate Loans of such Lender hereunder.
"Eurodollar Rate" means, relative to the Interest Period for each
---------------
Eurodollar Rate Loan comprising all or any part of the same Borrowing, the rate
of interest equal to (a) the interest rate per annum for deposits in U.S.
dollars and for a period approximately equal to such Interest Period which
appears on page 3750 of the Dow ▇▇▇▇▇ Telerate Screen as of 11:00 a.m. London
time two Business Days prior to the beginning of such Interest Period for
delivery on the first day of such Interest Period, or (b) if such a rate does
not appear on page 3750 of the Dow ▇▇▇▇▇ Telerate Screen, the average (rounded
upwards, if necessary, to the nearest 1/100 of 1%) of the rates per annum at
which Dollar deposits in immediately available funds are offered to the
Administrative Agent in the interbank market as at or about 11:00 a.m. New York
time two Business Days prior to the beginning of such Interest Period for
delivery on the first day of such Interest Period, and for a period equal to
such Interest Period.
"Eurodollar Rate Loan" means a Loan bearing interest, at all times during
--------------------
an Interest Period applicable to such Loan, at a fixed rate of interest
determined by reference to the Eurodollar Rate (Reserve Adjusted).
"Eurodollar Rate (Reserve Adjusted)" means, relative to any Loan to be
----------------------------------
made, continued or maintained as, or converted into, a Eurodollar Rate Loan for
any Interest Period, a rate per annum
10
(rounded upwards, if necessary, to the nearest 1/100 of 1%) determined pursuant
to the following formula:
Eurodollar Rate = Eurodollar Rate
------------------------------------
(Reserve Adjusted) 1.00 - Eurodollar Reserve Percentage
The Eurodollar Rate (Reserve Adjusted) for the Interest Period for each
Eurodollar Rate Loan comprising part of the same Borrowing will be determined by
the Administrative Agent two Business Days before the first day of such Interest
Period.
"Eurodollar Reserve Percentage" means, relative to each Interest Period, a
-----------------------------
percentage (expressed as a decimal) equal to the daily average during such
Interest Period of the percentages in effect on each day of such Interest
Period, as prescribed by the F.R.S. Board, for determining the maximum aggregate
reserve requirements (including any emergency, supplemental or other marginal
reserve requirement) applicable to "Eurocurrency Liabilities" pursuant to
Regulation D or any other applicable regulation issued from time to time by the
F.R.S. Board which prescribes reserve requirements applicable to "Eurocurrency
Liabilities" as currently defined in Regulation D having a term approximately
equal or comparable to such Interest Period.
"Event of Default" is defined in Section 8.1.
---------------- -----------
"Existing Letters of Credit" means the letters of credit described in
--------------------------
Schedule IV.
"Existing Subordinated Debt" means that certain promissory note dated as
--------------------------
of April 24, 1995 in the original principal amount of $15,000,000 payable by the
Borrower to ▇▇▇▇▇▇ Electronics Corporation.
"Expansion Capital Expenditures" means any Capital Expenditure of the
------------------------------
Borrower or any of its Subsidiaries which is not properly characterized as a
Maintenance Capital Expenditure.
"Federal Funds Rate" means, for any period, a fluctuating interest rate per
------------------
annum equal for each day during such period to
(a) the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by federal
funds brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank of
New York; or
(b) if such rate is not so published for any day which is a Business
Day, the average of the quotations for such day on such transactions
received by the Administrative
11
Agent from three federal funds brokers of recognized standing selected by
it.
"Fiscal Quarter" means any quarter of a Fiscal Year.
--------------
"Fiscal Year" means any period of twelve consecutive calendar months ending
-----------
on October 31; references to a Fiscal Year with a number corresponding to any
calendar year (e.g. the "1997 Fiscal Year" refer to the Fiscal Year ending on
----
October 31, 1997).
"Fixed Charge Coverage Ratio" means, except as otherwise provided in the
---------------------------
second following sentence, for any period, the ratio of (a) EBITDA minus
-----
Maintenance Capital Expenditures for the trailing four quarters ending on such
date to (b) the sum of (i) the Borrower's and its Subsidiaries' consolidated
interest expense (exclusive of interest income but in no event less than
zero)(each as defined under GAAP) for the trailing four quarters ending on such
date plus (ii) the Borrower's and its Subsidiaries' income tax expense for such
----
period and plus (iii) scheduled principal payments of the Borrower and its
----
Subsidiaries on Indebtedness for borrowed money or for Capitalized Lease
Liabilities for the trailing four quarters ending on such date. For the Fiscal
Quarter ending July 31, 1998 only, the "Fixed Charge Coverage Ratio" shall mean
the ratio of (a) EBITDA minus the product of (i) 4/3 times (ii) year-to-date
----- -----
Maintenance Capital Expenditures for the trailing three quarters ending July 31,
1998 to (b) the product of (i) 4/3 times (ii) the sum of (x) the Borrower's and
-----
its Subsidiaries' year-to-date consolidated interest expense (exclusive of
interest income but in no event less than zero)(each is defined under GAAP) plus
----
(y) the Borrower's and its Subsidiaries' year-to-date income tax expense and
plus (z) year-to-date scheduled principal payments of the Borrower and its
----
Subsidiaries on Indebtedness for borrowed money or for Capitalized Lease
Liabilities. For purposes of this definition (a) Maintenance Capital
Expenditures shall be calculated after excluding (i) all Maintenance Capital
Expenditures of ▇▇▇▇▇▇▇▇▇ Xyplex, Inc. and Xyplex, Inc. and (ii) all Maintenance
Capital Expenditures of ▇▇▇▇▇▇▇▇▇ Communications and ▇▇▇▇▇▇▇▇▇ Power Storage
made prior to the Effective Date and (b) principal payments shall be calculated
after excluding all principal payments made prior to the Effective Date.
"Fronting Fee" is defined in Section 3.3.4.
------------ -------------
"F.R.S. Board" means the Board of Governors of the Federal Reserve System
------------
or any successor thereto.
"Funded Debt" means the consolidated Indebtedness of the Borrower and its
-----------
Subsidiaries of the nature referred to in
12
clauses (a), (b), (c) and (f) of the definition of "Indebtedness".
----------- --- --- --- ------------
"GAAP" is defined in Section 1.4.
---- -----------
"Guaranty" means the guaranty dated the date hereof executed and delivered
--------
by the Guarantors pursuant to Section 5.1.3, and any guaranty executed and
-------------
delivered by a Guarantor pursuant to Section 7.1.9 hereof, each of which shall
-------------
be substantially in the form of Exhibit H hereto, as amended, supplemented,
---------
restated or otherwise modified from time to time.
"Guarantors" means, collectively, each of the Borrower's domestic
----------
Subsidiaries listed on Schedule III hereto and any other domestic Subsidiary of
the Borrower that executes a Guaranty pursuant to the provisions of Section
-------
7.1.9.
-----
"Hazardous Material" means
------------------
(a) any "hazardous substance", as defined by CERCLA;
(b) any "hazardous waste", as defined by the Resource Conservation
and Recovery Act, as amended;
(c) any petroleum product; or
(d) any pollutant or contaminant or hazardous or toxic chemical,
material or substance within the meaning of any other applicable federal,
state or local law, regulation, ordinance or requirement (including consent
decrees and administrative orders) relating to or imposing liability or
standards of conduct concerning any hazardous or toxic waste, substance or
material, all as amended or hereafter amended.
"Hazardous Materials Indemnity" means that certain Hazardous Materials
-----------------------------
Indemnity to be executed and delivered by the Borrower and ▇▇▇▇▇▇▇▇▇ Controls
pursuant to Section 7.1.11, in form and substance reasonably satisfactory to the
--------------
Administrative Agent, as amended, supplemented, restated or otherwise modified
from time to time.
"Hedging Obligations" means, with respect to any Person, all liabilities of
-------------------
such Person under interest rate swap agreements, interest rate cap agreements
and interest rate collar agreements, and all other agreements or arrangements
designed to protect such Person against fluctuations in interest rates or
currency exchange rates.
"herein", "hereof", "hereto", "hereunder" and similar terms contained in
------ ------ ------ ---------
this Agreement or any other Loan Document refer to this Agreement or such other
Loan Document, as the case may be,
13
as a whole and not to any particular Section, paragraph or provision of this
Agreement or such other Loan Document.
"Impermissible Qualification" means, relative to the opinion or
---------------------------
certification of any independent public accountant as to any financial statement
of the Borrower, any qualification or exception to such opinion or certification
(a) which is of a "going concern" or similar nature;
(b) which relates to the limited scope of examination of matters
relevant to such financial statement; or
(c) which relates to the treatment or classification of any item in
such financial statement and which, as a condition to its removal, would
require an adjustment to such item the effect of which would be to cause
the Borrower to be in default of any of its obligations under Section
-------
7.2.4.
"including" means including without limiting the generality of any
---------
description preceding such term.
"Indebtedness" of any Person means, without duplication:
------------
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments;
(b) all obligations, contingent or otherwise, relative to the face
amount of all letters of credit (excluding letters of credit directly or
indirectly backstopped by Letters of Credit issued hereunder), whether or
not drawn, and banker's acceptances issued for the account of such Person;
(c) all obligations of such Person as lessee under leases which have
been or should be, in accordance with GAAP, recorded as Capitalized Lease
Liabilities;
(d) net liabilities of such Person under all Hedging Obligations;
(e) whether or not so included as liabilities in accordance with
GAAP, all obligations of such Person to pay the deferred purchase price of
property or services, and indebtedness (excluding prepaid interest thereon)
secured by a Lien on property owned or being purchased by such Person
(including indebtedness arising under conditional sales or other title
retention agreements), whether or not such indebtedness shall have been
assumed by such Person or is
14
limited in recourse unless recourse for such indebtedness is limited to
specified property of such Person, in which event the amount of such
indebtedness shall not exceed the value of such property; and
(f) all Contingent Liabilities of such Person in respect of any of
the foregoing.
For all purposes of this Agreement, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture in which such Person is a
general partner or a joint venturer, to the extent such Person is liable
therefor.
"Indemnified Liabilities" is defined in Section 10.4.
----------------------- ------------
"Indemnified Parties" is defined in Section 10.4.
------------------- ------------
"Interest Period" means, relative to any Eurodollar Rate Loans, the period
---------------
beginning on (and including) the date on which such Eurodollar Rate Loan is made
or continued as, or converted into, a Eurodollar Rate Loan pursuant to Section
-------
2.3 or 2.4 and shall end on (but exclude) the day which numerically corresponds
--- ---
to such date one, two, three or six months thereafter (or, if such month has no
numerically corresponding day, on the last Business Day of such month) or for
such other time period for which the Administrative Agent shall determine that
Dollar deposits are generally available in the interbank market, in either case
as the Borrower may select in its relevant notice pursuant to Section 2.3 or
-----------
2.4; provided, however, that
--- -------- -------
(a) the Borrower shall not be permitted to select Interest Periods to
be in effect at any one time which have expiration dates occurring on more
than seven (7) different dates;
(b) Interest Periods commencing on the same date for Loans comprising
part of the same Borrowing shall be of the same duration;
(c) if such Interest Period would otherwise end on a day which is not
a Business Day, such Interest Period shall end on the next following
Business Day (unless such next following Business Day is the first Business
Day of a calendar month, in which case such Interest Period shall end on
the Business Day next preceding such numerically corresponding day); and
(d) no Interest Period may end later than the date set forth in
clause (a) of the definition of "Revolving Commitment Termination Date," in
---------- -------------------------------------
the case of Interest Periods for Revolving Loans, or the date set forth in
clause
------
15
(a) of the definition of "Term Loan Commitment Termination Date," in the case
--- -------------------------------------
of Interest Periods for Term Loans.
"Investment" means, relative to any Person,
----------
(a) any loan or advance made by such Person to any other Person
(excluding commission, travel and similar advances to officers and
employees made in the ordinary course of business);
(b) any Contingent Liability of such Person; and
(c) any ownership or similar interest held by such Person in any
other Person.
The amount of any Investment shall be the original principal or capital amount
thereof less all returns of principal or equity thereon (and without adjustment
by reason of the financial condition of such other Person) and shall, if made by
the transfer or exchange of property other than cash, be deemed to have been
made in an original principal or capital amount equal to the fair market value
of such property.
"L/C Fees" is defined in Section 3.3.4.
-------- -------------
"L/C Issuer" shall mean CIBC, and its successors and assigns or, with the
----------
written consent of CIBC, the Borrower and any Lender, such other Lender.
"Leasehold Deeds of Trust" means the Leasehold Deeds of Trust to be
------------------------
executed and delivered by the Borrower and ▇▇▇▇▇▇▇▇▇ Controls pursuant to
Section 7.1.10, in form and substance reasonably satisfactory to the
--------------
Administrative Agent, as amended, supplemented, restated or otherwise modified
from time to time.
"Lender Assignment Agreement" means a Lender Assignment Agreement
---------------------------
substantially in the form of Exhibit F hereto.
---------
"Lenders" is defined in the preamble.
------- --------
"Letter of Credit" means the Existing Letters of Credit and each standby
----------------
letter of credit issued at the request and for the account of the Borrower or
one or more of its Subsidiaries pursuant to Section 2.7.
-----------
"Leverage Ratio" means the ratio of (a) Funded Debt as of the last day of
--------------
any Fiscal Quarter to (b) EBITDA as of the last day of such Fiscal Quarter.
"Lien" means any security interest, mortgage, pledge, hypothecation,
----
assignment, deposit arrangement, encumbrance, lien
16
(statutory or otherwise), charge against or interest in property to secure
payment of a debt or performance of an obligation or other priority or
preferential arrangement of any kind or nature whatsoever.
"Loan" means, as the context may require, a Revolving Loan, a Term Loan or
----
a Swing Loan of any Type made hereunder.
"Loan Document" means this Agreement, the Notes, the Guaranty, the
-------------
Leasehold Deeds of Trust, the Security Agreement, each document executed by the
Borrower or any Guarantor as collateral security for the Obligations and each
other agreement, document or instrument delivered in connection with this
Agreement and the Notes that is designated by the parties thereto as a Loan
Document.
"Maintenance Capital Expenditures" means any Capital Expenditures by the
--------------------------------
Borrower or its Subsidiaries which are made to maintain or restore the condition
or usefulness of property of the Borrower or its Subsidiaries or which are made
in the ordinary course of business but which are not properly chargeable to
repairs and maintenance in accordance with GAAP.
"Majority Lenders" means, at any time, Lenders holding at least 51% of the
----------------
then aggregate Commitments.
"Material Adverse Effect" means any circumstances or event which (i) has a
-----------------------
material adverse effect upon the validity or enforceability of this Agreement,
the Notes or any other Loan Document, (ii) is material and adverse to the
financial condition, business operations or property of the Borrower and the
Guarantors, taken as a whole, or (iii) materially impairs the ability of the
Borrower and the Guarantors to fulfill their obligations under this Agreement,
the Notes or any other Loan Document to which they are a party.
"Monthly Payment Date" means the last day of each calendar month or, if any
--------------------
such day is not a Business Day, the next succeeding Business Day.
"New Lender" is defined in Section 2.8.
---------- -----------
"Northholme Partners" means Northholme Partners, a California limited
-------------------
partnership.
"Note" means, as the context may require, either a Revolving Note, a Term
----
Note or the Swingline Note.
"Notes" means the Revolving Notes, the Term Notes and the Swingline Note.
-----
17
"Obligations" means all obligations (monetary or otherwise) of the Borrower
-----------
and each other Obligor arising under or in connection with this Agreement, the
Notes and each other Loan Document.
"Obligor" means the Borrower, a Guarantor or any other Person (other than
-------
the Administrative Agent, the Documentation Agent, the L/C Issuer, the Swingline
Lender or any Lender) obligated under any Loan Document.
"Organic Document" means, relative to any Person, its certificate or
----------------
articles of incorporation, its partnership agreement, its by-laws and all
shareholder agreements, voting trusts and similar arrangements applicable to any
of its authorized shares of capital stock.
"Participant" is defined in Section 10.11.2.
----------- ---------------
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
----
succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is defined in section
------------
3(2) of ERISA, which is subject to Title IV of ERISA (other than a multiemployer
plan as defined in section 4001(a)(3) of ERISA), and to which the Borrower or
any corporation, trade or business that is, along with the Borrower, a member of
a Controlled Group, may have liability, including any liability by reason of
having been a substantial employer within the meaning of section 4063 of ERISA
at any time during the preceding five years, or by reason of being deemed to be
a contributing sponsor under section 4069 of ERISA.
"Percentage" means, as the context may require, a Lender's Revolving
----------
Percentage, Term Percentage or Aggregate Percentage.
"Person" means any natural person, corporation, limited liability company,
------
partnership, firm, association, trust, government, governmental agency or any
other entity, whether acting in an individual, fiduciary or other capacity.
"Plan" means any Pension Plan or Welfare Plan.
----
"Quarterly Payment Date" means the last day of each February, May, August,
----------------------
and November or, if any such day is not a Business Day, the next succeeding
Business Day.
"Release" means a "release", as such term is defined in CERCLA.
-------
"Required Lenders" means, at any time, Lenders holding at least 66 2/3% of
----------------
the then aggregate Commitments.
18
"Resource Conservation and Recovery Act" means the Resource Conservation
--------------------------------------
and Recovery Act, 42 U.S.C. Section 6901, et seq., as in effect from time to
-- ---
time.
"Revolving Loan" is defined in Section 2.1.2.
-------------- -------------
"Revolving Loan Commitment" is defined in Section 2.1.2.
------------------------- -------------
"Revolving Loan Commitment Amount" means, on any date, $45,000,000, as such
--------------------------------
amount may be reduced from time to time pursuant to Section 2.2 or increased
-----------
pursuant to Section 2.8, minus the aggregate principal amount of indebtedness of
----------- -----
the Borrower to the Swingline Lender resulting from outstanding Swing Loans,
minus the aggregate undrawn face amount of outstanding Letters of Credit
-----
(determined, in the case of Letters of Credit not denominated in Dollars, as
provided in Section 2.7).
-----------
"Revolving Loan Commitment Termination Date" means the earliest of
------------------------------------------
(a) the Stated Maturity Date for Revolving Loans;
(b) the date on which the Revolving Loan Commitments of the Lenders
are terminated in full or reduced to $20,000,000 or less pursuant to
Section 2.2; and
-----------
(c) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described in clause (b) or (c), the Revolving
---------- ---
Loan Commitments shall terminate automatically and without any further action.
"Revolving Note" means a promissory note of the Borrower payable to any
--------------
Lender in the form of Exhibit A hereto (as such promissory note may be amended,
---------
endorsed or otherwise modified from time to time), evidencing the aggregate
Indebtedness of the Borrower to such Lender resulting from outstanding Revolving
Loans, and also means all other promissory notes accepted from time to time in
substitution therefor or renewal thereof.
"Revolving Percentage" means, relative to any Lender for all Revolving
--------------------
Loans made or Letters of Credit issued, the percentage set forth opposite its
name on Schedule I under the caption "Revolving Percentage" or as set forth in
its Lender Assignment Agreement, as such percentage may be adjusted from time to
time pursuant to Section 2.8 or pursuant to Lender Assignment Agreements
-----------
executed by such Lender and its Assignee Lenders and delivered pursuant to
Section 10.11.
-------------
19
"Security Agreement" means the Security Agreement executed and delivered by
------------------
the Borrower and the Guarantors pursuant to Section 5.1.5, substantially in the
-------------
form of Exhibit I hereto, as amended, supplemented, restated or otherwise
---------
modified from time to time.
"Significant Subsidiary" means each Subsidiary of the Borrower that
----------------------
(a) is designated with an asterisk in Item 6.8 ("Existing
--------
Subsidiaries") of the Disclosure Schedule;
(b) accounted for at least 5% of consolidated revenues of the
Borrower and its Subsidiaries for the four Fiscal Quarters of the Borrower
for which financial statements are available ending on the last day of the
last Fiscal Quarter of the Borrower immediately preceding the date as of
which any such determination is made; or
(c) has assets which represent at least 5% of the consolidated assets
of the Borrower and its Subsidiaries as of the last day of the last Fiscal
Quarter of the Borrower immediately preceding the date as of which any such
determination is made,
"Stated Maturity Date" means
--------------------
(a) in the case of any Revolving Loan or Swing Loan, May 30, 2001,
subject to extension pursuant to Section 2.9; and
-----------
(b) in the case of any Term Loan, May 30, 2003.
"Subordinated Debt" means the Existing Subordinated Debt and all other
-----------------
unsecured Indebtedness of the Borrower for money borrowed which is subordinated,
upon terms satisfactory to the Administrative Agent, in right of payment to the
payment in full in cash of all Obligations.
"Subsidiary" means, with respect to any Person, any corporation of which
----------
more than 50% of the outstanding capital stock having ordinary voting power to
elect a majority of the board of directors of such corporation (irrespective of
whether at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence of any
contingency) is at the time directly or indirectly owned by such Person, by such
Person and one or more other Subsidiaries of such Person, or by one or more
other Subsidiaries of such Person; provided, however, that the term "Subsidiary"
-------- -------
shall not include any Unrestricted Subsidiary.
20
"Swingline Commitment" is defined in Section 2.1.3.
-------------------- -------------
"Swingline Lender" is defined in the preamble.
----------------
"Swingline Note" means a promissory note of the Borrower payable to the
--------------
Swingline Lender in the form of Exhibit C hereto (as such promissory note may be
---------
amended, endorsed or otherwise modified from time to time), evidencing the
aggregate Indebtedness of the Borrower to the Swingline Lender resulting from
outstanding Swing Loans, and also means all other promissory notes accepted from
time to time in substitution therefor or renewal thereof.
"Swing Loan" means each Loan made by the Swingline Lender pursuant to the
----------
Swingline Commitment.
"Swing Loan Commitment Amount" means, on any date, $5,000,000, as such
----------------------------
amount may be reduced from time to time pursuant to Section 2.2.
-----------
"Taxes" is defined in Section 4.6.
----- -----------
"Term Loan" is defined in Section 2.1.1.
--------- -------------
"Term Loan Commitment" means, relative to any Lender, such Lender's
--------------------
obligation to make Term Loans pursuant to Section 2.1.1.
-------------
"Term Loan Commitment Amount" means, on any date, $40,000,000, as such
---------------------------
amount may be reduced from time to time pursuant to Section 2.2 or increased
-----------
pursuant to Section 2.8.
-----------
"Term Loan Commitment Termination Date" means the earliest of
-------------------------------------
(a) May 30, 2003;
(b) the date on which the Term Loan Commitment Amount is terminated in
full or reduced to zero pursuant to Section 2.2; and
-----------
(c) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described in clause (b) or (c), the Term Loan
---------- ---
Commitments shall terminate automatically and without any further action.
"Term Note" means a promissory note of the Borrower payable to any Lender,
---------
in the form of Exhibit B hereto (as such promissory note may be amended,
---------
endorsed or otherwise modified from time to time), evidencing the aggregate
Indebtedness of the
21
Borrower to such Lender resulting from such Lender's Term Loan, and also means
all other promissory notes accepted from time to time in substitution therefor
or renewal thereof.
"Term Percentage" means, relative to any Lender for its Term Loan made, the
---------------
percentage set forth opposite its name on Schedule I under the caption "Term
Percentage" or as set forth in its Lender Assignment Agreement, as such
percentage may be adjusted from time to time pursuant to Section 2.8 or pursuant
-----------
to Lender Assignment Agreements executed by such Lender and its Assignee Lenders
and delivered pursuant to Section 10.11.
-------------
"Title Company" means First American Title Company of Los Angeles or such
-------------
other title insurance company as may be reasonably acceptable to the
Administrative Agent.
"type" or "Type" means, relative to any Loan, the portion thereof, if any,
---- ----
being maintained as a Base Rate Loan or a Eurodollar Rate Loan.
"United States" or "U.S." means the United States of America, its fifty
------------- ----
States and the District of Columbia.
"Unrestricted Subsidiary" means any Person created after the date hereof in
-----------------------
which the Borrower or any of its Subsidiaries owns all or a portion of the
outstanding capital stock or other ownership interests and which the Borrower
has designated in a written notice to the Agent as an "Unrestricted Subsidiary".
"Welfare Plan" means a "welfare plan", as such term is defined in section
------------
3(1) of ERISA.
"▇▇▇▇▇▇▇▇▇ Communications" means ▇▇▇▇▇▇▇▇▇ Communications, Inc., a
------------------------
California corporation and Subsidiary of the Borrower.
"▇▇▇▇▇▇▇▇▇ Controls" means ▇▇▇▇▇▇▇▇▇ Controls, Inc., a California
------------------
corporation and Subsidiary of the Borrower.
"Whittaker Porta Bella" means Whittaker Porta Bella Development, Inc., a
---------------------
California corporation and Subsidiary of the Borrower.
"▇▇▇▇▇▇▇▇▇ Power Storage" means the power storage division of ▇▇▇▇▇▇▇▇▇
-----------------------
Technical Products, Inc., a Subsidiary of the Borrower.
SECTION 1.2. Use of Defined Terms. Unless otherwise defined or the
--------------------
context otherwise requires, terms for which meanings are provided in this
Agreement shall have such meanings when used in the Disclosure Schedule and in
each Note, Borrowing Request, Continuation/Conversion Notice, Loan Document,
notice
22
and other communication delivered from time to time in connection with this
Agreement or any other Loan Document.
SECTION 1.3. Cross-References. Unless otherwise specified, references in
----------------
this Agreement and in each other Loan Document to any Article or Section are
references to such Article or Section of this Agreement or such other Loan
Document, as the case may be, and, unless otherwise specified, references in any
Article, Section or definition to any clause are references to such clause of
such Article, Section or definition.
SECTION 1.4. Accounting and Financial Determinations. Unless otherwise
---------------------------------------
specified, all accounting terms used herein or in any other Loan Document shall
be interpreted, all accounting determinations and computations hereunder or
thereunder (including under Section 7.2.4) shall be made, and all financial
-------------
statements (excluding forecasts) required to be delivered hereunder or
thereunder shall be prepared in accordance with, generally accepted accounting
principles ("GAAP") as in effect from time to time, applied on a basis
----
consistent (except for changes concurred in by the Borrower's independent public
accountants) with the most recent audited consolidated financial statements of
the Borrower and its Subsidiaries delivered to the Administrative Agent;
provided that, if either the Borrower or the Administrative Agent shall notify
--------
the other of an objection to the application of any change in GAAP to any
covenant in Article VII, any defined term used therein or the calculation of any
fee or interest rate hereunder, such parties shall negotiate in an effort to
resolve such objection; provided that, if the parties are unable to reach
--------
resolution, such change in GAAP shall be disregarded for purposes of any such
covenant, definition, fee or interest rate.
ARTICLE II
COMMITMENTS, BORROWING PROCEDURES AND NOTES
SECTION 2.1. Commitments. On the terms and subject to the conditions
-----------
of this Agreement (including Article V), each Lender severally agrees to make
---------
Loans pursuant to the Commitments described in this Section 2.1.
-----------
SECTION 2.1.1. Term Loan Commitment. On the date of the initial
--------------------
Borrowing hereunder, each Lender will make Loans (relative to such Lender, its
"Term Loan") to the Borrower equal to such Lender's Term Percentage of the
----------
aggregate amount of the Borrowing of Term Loans requested by the Borrower to be
made on such day. The Commitment of each Lender described in this Section 2.1.1
-------------
is herein referred to as its "Term Loan Commitment". Except as otherwise
--------------------
provided in Section 2.8, any
-----------
23
portion of the Term Loan Commitment Amount that is not borrowed on the date of
the initial Borrowing hereunder shall be extinguished on such date. No amounts
paid or prepaid with respect to Term Loans may be reborrowed.
SECTION 2.1.2. Revolving Loan Commitment of Each Lender. From time to
----------------------------------------
time on any Business Day occurring prior to the Revolving Loan Commitment
Termination Date, each Lender will make loans (relative to such Lender, its
"Revolving Loans") to the Borrower equal to such Lender's Revolving Percentage
----------------
of the aggregate amount of the Borrowing of Revolving Loans requested by the
Borrower to be made on such day. The commitment of each Lender described in
this Section 2.1.2 is herein referred to as its "Revolving Loan Commitment". On
------------- -------------------------
the terms and subject to the conditions hereof, the Borrower may from time to
time borrow, prepay and reborrow Revolving Loans.
SECTION 2.1.3. Swing Loan Commitment. From time to time on any Business
---------------------
Day occurring before the Revolving Loan Commitment Termination Date, the
Swingline Lender will make Swing Loans to the Borrower equal to the amount of
Swing Loans requested by the Borrower to be made on such day. The commitment of
the Swingline Lender described in this Section 2.1.3 is herein referred to as
-------------
its "Swingline Commitment". On the terms and subject to the conditions hereof,
--------------------
the Borrower may from time to time borrow, repay and reborrow Swing Loans.
SECTION 2.1.4. Lenders Not Permitted or Required To Make Loans.
-----------------------------------------------
(a) No Lender shall be permitted or required to make its Term Loan if,
after giving effect thereto,
(i) the aggregate outstanding principal amount of all Term Loans of
all Lenders would exceed the Term Loan Commitment Amount, or
(ii) the aggregate outstanding principal amount of the Term Loans of
such Lender would exceed such Lender's Term Percentage of the Term Loan
Commitment Amount.
(b) No Lender shall be permitted or required to make any Revolving Loan if,
after giving effect thereto, the aggregate outstanding principal amount of all
Revolving Loans
(i) of all Lenders would exceed the Revolving Loan Commitment Amount,
or
(ii) of such Lender would exceed such Lender's Revolving Percentage of
the Revolving Loan Commitment Amount.
24
(c) The Swingline Lender shall not be permitted or required to make any
Swing Loan if,
(i) after giving effect thereto, the aggregate outstanding principal
amount of all Swing Loans would exceed the Swing Loan Commitment Amount; or
(ii) the amount of such Swing Loan would exceed the Revolving Loan
Commitment Amount (immediately prior to giving effect to such Swing Loan)
minus the aggregate principal amount of outstanding Revolving Loans.
-----
SECTION 2.2. Reduction of Commitment Amounts. The Commitment Amounts
-------------------------------
are subject to reduction from time to time pursuant to this Section 2.2.
-----------
SECTION 2.2.1. Optional. The Borrower may, from time to time on any
--------
Business Day, voluntarily reduce the amount of any Commitment Amount; provided,
--------
however, that all such reductions shall require at least three Business Days'
-------
prior notice to the Administrative Agent and be permanent, and any partial
reduction of any Commitment Amount shall be in a minimum amount of $1,000,000 or
an integral multiple thereof.
SECTION 2.2.2. Mandatory. There shall be a mandatory reduction of the
---------
Term Loan Commitment Amount by the following amounts:
(a) Fifty percent (50%) of the net cash proceeds received by the Borrower
from the issuance of any equity securities (excluding any equity issuances
related to the exercise of employee stock options);
(b) Seventy-five percent (75%) of the net cash proceeds received by the
Borrower or any of its Subsidiaries from the sale or disposition of any of their
assets other than (i) sales or dispositions in the ordinary course of business
or (ii) the sale by Whittaker Porta Bella of its real property interests in
Santa Clarita, California or the sale by the Borrower of Whittaker Porta Bella;
(c) One hundred percent (100%) of all cash insurance proceeds received by
the Borrower or any of its Subsidiaries from any condemnation awards or casualty
losses; provided, however, so long as no Event of Default shall have occurred
--------
and be continuing, upon the Borrower's request such proceeds shall be retained
by the Borrower or delivered to the Borrower to repair or replace the property
subject to such casualty; and
(d) All net non-cash proceeds (including any promissory notes) realized
from any transaction described in clause (b) or
---------
25
(c) above shall on the first Business Day following the Borrower's receipt
-
thereof be assigned and delivered to the Administrative Agent as and shall be
held by the Administrative Agent as additional Collateral for the performance of
the Obligations. Upon the reduction of any non-cash proceeds to cash, the
principal amount of such proceeds shall be applied by the Administrative Agent
as hereinafter provided and any interest attributable to such proceeds shall,
prior to the occurrence and continuance of an Event of Default, be delivered to
the Borrower and from and after the occurrence and continuance of an Event of
Default, be applied by the Administrative Agent as hereinafter provided.
Such reduction of the Term Loan Commitment Amount shall be effective on the
first Business Day following the Borrower's receipt of such net cash proceeds
and shall be applied to the prepayment of the Term Loans, with such application
to be made to the pro rata reduction of the Term Loan repayments specified in
--- ----
Section 3.1.1(b).
----------------
SECTION 2.2.3. Special Letter of Credit Provisions. Notwithstanding
-----------------------------------
anything to the contrary herein, the Borrower may not reduce the Revolving Loan
Commitments of the Revolving Lenders to an amount less than the aggregate
undrawn face amount of outstanding Letters of Credit then in effect unless the
Borrower shall have deposited with the Administrative Agent all amounts required
pursuant to the second paragraph of Section 2.7 hereof.
-----------
SECTION 2.3. Borrowing Procedure.
-------------------
SECTION 2.3.1. Revolving Loans and Term Loans. The Borrower may from
------------------------------
time to time irrevocably request that a Borrowing of Revolving Loans be made,
and may prior to the date of its initial Borrowing hereunder irrevocably request
that a Borrowing of Term Loans be made, by delivering a Borrowing Request to the
Administrative Agent (i) for a Eurodollar Rate Loan, on or before 12:30 p.m.,
New York time, on a Business Day, at least three Business Days prior to the date
of such proposed Borrowing, in a minimum amount of $1,000,000 or an integral
multiple of $250,000 in excess thereof, or in the unused amount of the
applicable Commitment Amount and (ii) for a Base Rate Loan, on or before 12:30
p.m., New York time, on a Business Day, at least one Business Day prior to the
date of such proposed Borrowing, in a minimum amount of $1,000,000 or an
integral multiple of $250,000 in excess thereof, or in the unused amount of the
applicable Commitment Amount. The Administrative Agent shall promptly notify
each other Lender in writing of the terms of such Borrowing Request. On the
terms and subject to the conditions of this Agreement, each Borrowing shall be
comprised of the Type of Loans, and shall be made on the Business Day,
26
specified in such Borrowing Request. On or before 1:30 p.m., New York time, on
the Business Day such Loans are to be made, each Lender shall deposit with the
Administrative Agent same day funds in an amount equal to such Lender's
Percentage of the requested Borrowing. Such deposit will be made to an account
which the Administrative Agent shall specify from time to time by notice to the
Lenders. No Lender's obligation to make any Loan shall be affected by any other
Lender's failure to make any Loan. To the extent funds are received from the
Lenders, on the proposed date for such Borrowing the Administrative Agent shall
make such funds available to the Borrower at the office of the Administrative
Agent.
SECTION 2.3.2. Swing Loans. The Borrower may from time to time
-----------
irrevocably request, by delivering a telephonic notice to the Swingline Lender
(which notice shall promptly be confirmed by telecopying a completed Borrowing
Request to the Swingline Lender and to the Administrative Agent) that a
Borrowing of Swing Loans be made, by 1:00 p.m., New York time, on or before the
date such Borrowing is requested, in a minimum amount of $100,000 or an integral
multiple thereof, or in the unused amount of the Swing Loan Commitment Amount.
On the terms and subject to the conditions of this Agreement, each such
Borrowing shall be comprised of Base Rate Loans, and shall be made on the
Business Day specified in such Borrowing Request. The Swingline Lender shall
make funds in an amount equal to the requested Borrowing available to the
Borrower to the accounts the Borrower shall have specified in such Borrowing
Request. Each request by the Borrower for a Borrowing of Swing Loans shall be
deemed to reaffirm the representations set forth in subsections (a) and (b) of
--- ---
Section 5.2.1. The Swingline Lender shall not fund a Borrowing of Swing Loans
-------------
if prior to the date of such Borrowing the Swingline Lender shall have received
written notice from the Administrative Agent or any Lender of the existence and
continuance of an Event of Default.
SECTION 2.4. Continuation and Conversion Elections. By delivering a
-------------------------------------
Continuation/Conversion Notice to the Administrative Agent on or before 12:30
p.m., New York time, on a Business Day, the Borrower may from time to time
irrevocably elect, on not less than three or more than five Business Days'
notice that all, or any portion in an aggregate minimum amount of $1,000,000 and
an integral multiple of $250,000 in excess thereof, of any Loan be, in the case
of Base Rate Loans, converted into Eurodollar Rate Loans or, in the case of
Eurodollar Rate Loans, continued as a Eurodollar Rate Loan or that all, or any
portion in an aggregate minimum amount of $1,000,000 and an integral multiple of
$250,000 in excess thereof of any Loan be, in the case of Eurodollar Rate Loans,
converted into Base Rate Loans (in the absence of delivery of a
Continuation/Conversion Notice with respect to any Eurodollar Rate Loan at least
three Business Days before the last
27
day of the then current Interest Period with respect thereto, such Eurodollar
Rate Loan shall, on such last day, automatically convert to a Base Rate Loan);
provided, however, that no portion of the outstanding principal amount of any
-------- -------
Loans may be continued after the end of the applicable Interest Period therefor
as, or be converted into, Eurodollar Rate Loans when any Default has occurred
and is continuing. The Administrative Agent shall promptly notify each other
Lender in writing of the terms of such Continuation/Conversion Notice.
SECTION 2.5. Funding. Subject to Section 4.11, each Lender may, if it
------- ------------
so elects, fulfill its obligation to make, continue or convert Eurodollar Rate
Loans hereunder by causing one of its foreign branches or Affiliates (or an
international banking facility created by such Lender) to make or maintain such
Eurodollar Rate Loan; provided, however, that such Eurodollar Rate Loan shall
-------- -------
nonetheless be deemed to have been made and to be held by such Lender, and the
obligation of the Borrower to repay such Eurodollar Rate Loan shall nevertheless
be to such Lender for the account of such foreign branch, Affiliate or
international banking facility. In addition, the Borrower hereby consents and
agrees that, for purposes of any determination to be made for purposes of
Sections 4.1, 4.2, 4.3 or 4.4, it shall be conclusively assumed that each Lender
------------ --- --- ---
elected to fund all Eurodollar Rate Loans by purchasing Dollar deposits in its
Eurodollar Office's interbank eurodollar market.
SECTION 2.6. Notes. Each original Lender's Loans under a Commitment
-----
shall be evidenced by a Note payable to the order of such Lender in a maximum
principal amount equal to such Lender's Percentage of the original applicable
Commitment Amount. The Borrower hereby irrevocably authorizes each Lender to
make (or cause to be made) appropriate notations on the grid attached to such
Lender's Notes (or on any continuation of such grid attached to such Lender's
Notes), which notations, if made, shall evidence, inter alia, the date of, the
----- ----
outstanding principal of, and the interest rate and Interest Period applicable
to the Loans evidenced thereby. Such notations shall be conclusive and binding
on the Borrower absent manifest error; provided, however, that the failure of
-------- -------
any Lender to make any such notations shall not limit or otherwise affect any
Obligations of the Borrower or any other Obligor.
SECTION 2.7. Letter of Credit Procedure. The Borrower may from time to
--------------------------
time request that a Letter of Credit be issued by delivering to the L/C Issuer
(with a telecopy to the Administrative Agent) on a Business Day, at least three
Business Days prior to the date of such proposed issuance, a Letter of Credit
application in the L/C Issuer's then standard form, completed to the
satisfaction of the L/C Issuer, and such other certificates as the L/C Issuer
may reasonably request; provided,
--------
28
however, that except for Letters of Credit denominated in foreign currency and
-------
having an aggregate face amount of not more than $1,000,000 of Dollar
equivalent, no Letter of Credit shall be issued in any currency other than
Dollars and no Letter of Credit shall be issued if (a) after giving effect to
the issuance thereof, the aggregate undrawn face amount of outstanding Letters
of Credit would exceed $10,000,000 or (b) immediately prior to the issuance
thereof, the amount of such Letter of Credit would exceed the Revolving Loan
Commitment Amount minus the aggregate unpaid principal amount of Revolving
-----
Loans then outstanding. On the terms and subject to the conditions of this
Agreement, each Letter of Credit shall be issued by the L/C Issuer on the
Business Day specified in the Borrower's application therefor. The
Administrative Agent shall promptly notify each Lender in writing of the
material terms of each Letter of Credit issued by the L/C Issuer. Each request
for a Letter of Credit and each Letter of Credit shall be subject to the Uniform
Customs and Practice for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication Number 500. Each Letter of Credit will be issued
for a term of not more than one year, and in no event shall any Letter of Credit
have an expiration date later than the Stated Maturity Date for Revolving Loans.
On each Quarterly Payment Date, the Administrative Agent shall determine
the Dollar equivalent of each Letter of Credit denominated in a foreign
currency. If after such conversion
(a) the aggregate undrawn face amount of all outstanding Letters of
Credit would exceed $10,000,000, the Borrower shall deposit with
the Administrative Agent an amount equal to such excess, such
amount to be placed in a segregated, interest-bearing cash
collateral account over which the Borrower shall have no control.
Such amount shall be held by the Administrative Agent until the
earliest of (i) expiration of such Letter of Credit (in which
event such cash shall be returned to the Borrower), (ii) the date
a drawing is made under such Letter of Credit (in which event
such cash shall be applied by the Administrative Agent to the
reimbursement thereof) or (iii) the date the aggregate undrawn
face amount of all outstanding Letters of Credit is equal to or
less than $10,000,000 (in which event such cash shall be returned
to the Borrower); and
(b) the aggregate outstanding principal amount of Revolving Loans and
Swing Loans plus the face amount of all outstanding Letters of
Credit would exceed the aggregate Revolving Loan Commitments of
all Revolving Lenders, then, within one Business
29
Day, the Borrower shall make a mandatory prepayment (with no
accompanying Commitment reduction) of Revolving Loans by an
amount equal to such excess.
Upon any termination of the Revolving Loan Commitment prior to the Stated
Maturity Date for Revolving Loans, the Borrower shall deposit with the
Administrative Agent an amount equal to 105% of the aggregate amount available
to be drawn under outstanding Letters of Credit, such amount to be placed in a
segregated, interest-bearing cash collateral account pledged to the Lenders as
Collateral hereunder over which the Borrower shall have no control but which
shall be applied to repay the Borrower's obligations in connection with such
Letters of Credit and/or if an Event of Default has occurred and is continuing
to repay any other Obligations then due and owing. In the event the expiration
date (or earlier termination) of any Letter of Credit should occur with no draw
having been made thereunder for which the Borrower has not made reimbursement
and so long as no Event of Default has occurred and is continuing, the amount of
the cash collateral account shall be reduced by 105% of the undrawn amount of
such expired Letter of Credit, and the amount of such reduction shall be paid to
the Borrower (and, in the case of the final Letter of Credit to expire or
otherwise be terminated, the remaining balance of the cash collateral account
shall be paid to the Borrower).
SECTION 2.8. Increase in Aggregate Revolving Loan Commitments and/or
-------------------------------------------------------
Term Loan Commitment Amount.
---------------------------
(a) Provided that no Default or Event of Default then exists, the
Borrower may on any Business Day between the first and second anniversary
of the Effective Date, request in writing that the then effective Term Loan
Commitment Amount and/or aggregate Revolving Loan Commitments be increased
by an aggregate amount which is not greater than $15,000,000 in accordance
with the provisions of this Section. The Borrower may make only one
request under this Section. Any request under this Section shall be
submitted by the Borrower to the Administrative Agent (which shall forward
copies to the Lenders), specify the proposed effective date (which date
shall be not less than 5 days after the date of such request), the amount
of such increase and the Commitment Amount(s) proposed to be increased
(which shall be in integral multiples of $1,000,000). No Lender shall have
any obligation, express or implied, to offer to increase its Commitment.
Only the consent of those Lenders that have increased their Commitments
(the "Increasing Lenders") shall be required for an increase in the
------------------
Commitment Amounts pursuant to this Section.
30
(b) The Borrower may accept some or all of the offered amounts from
the then-current Lenders or designate new lenders who qualify as Eligible
Assignees and which are reasonably acceptable to the Administrative Agent
as additional Lenders hereunder in accordance with clause (c) of this
Section (each, a "New Lender"), which New Lender may assume all or a
----------
portion of the increase in the applicable Commitment Amount. The Borrower
shall have discretion to adjust the allocation of the increased Commitment
Amount among Increasing Lenders and New Lenders.
(c) Each New Lender designated by the Borrower and reasonably
acceptable to the Administrative Agent shall become an additional party
hereto as a New Lender concurrently with the effectiveness of the proposed
increase in the applicable Commitment Amount upon its execution of an
instrument of joinder to this Agreement which is in form and substance
reasonably acceptable to the Administrative Agent and which, in any event,
contains the representations, warranties, indemnities and other protections
afforded to the Administrative Agent and the other Lenders.
(d) Subject to the foregoing, any increase requested by the Borrower
shall be effective as of the date proposed by the Borrower and shall be in
the principal amount equal to (i) the amount which Increasing Lenders are
willing to assume as increases to the amount of their Commitments plus (ii)
----
the amount offered by any New Lender, in either case as adjusted by the
Borrower pursuant to Section 2.8(b), subject to the reasonable approval of
--------------
the Administrative Agent. Upon the effectiveness of any such increase, if
requested by the applicable Lender, the Borrower shall issue replacement
Notes to each Increasing Lender and new Notes to each New Lender, and the
applicable Percentages of each Lender will be adjusted to give effect to
the increase in the applicable Commitment Amount as set forth in a new
Schedule I issued by the Administrative Agent. To the extent that the
----------
adjustment of Percentages results in loss or expenses to any Lender as a
result of the prepayment of any Eurodollar Rate Loan on a date other than
the scheduled last day of the Interest Period applicable thereto, the
Borrower shall be responsible for such loss or expenses pursuant to Section
-------
4.4.
---
SECTION 2.9. Extension of Revolving Loan Stated Maturity Date.
------------------------------------------------
(a) The Borrower may, by written request to the Administrative Agent
delivered at any time after May 30, 1999 and before November 30, 2000,
request that the Lenders extend the Stated Maturity Date for Revolving
Loans by one year.
31
(b) Upon receipt of such request, the Administrative Agent promptly
shall notify each Lender, and each Lender shall notify the Administrative
Agent within thirty days thereafter of its election, in its sole
discretion, (i) to extend the Stated Maturity Date for Revolving Loans by
one year, or (ii) not to extend the Stated Maturity Date for Revolving
Loans by one year. The failure of any Lender to notify the Administrative
Agent of its election shall be deemed to constitute the election by such
Lender not to extend the Stated Maturity Date for Revolving Loans by one
year.
(c) In the event that all Lenders agree (in their sole discretion) to
extend the Stated Maturity Date for Revolving Loans by one year in
accordance with the Borrower's request, then, the Borrower may, by notice
to such effect to the Administrative Agent prior to January 15, 2001,
accompanied by the payment of an extension fee in an amount equal to 1/4 of
1% of the aggregate Revolving Loan Commitments on the date such notice is
given, confirm that the Stated Maturity Date for Revolving Loans shall be
extended by one year. In the event that all Lenders do not agree (in their
sole discretion) to extend the Stated Maturity Date for Revolving Loans by
one year in accordance with the Borrower's request, the Stated Maturity
Date for Revolving Loans shall not be so extended.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments. The Borrower shall repay in
--------------------------
full the unpaid principal amount of each Loan upon the Stated Maturity Date.
SECTION 3.1.1. Payment Terms. Prior to the Stated Maturity Date, the
-------------
Borrower
(a) may, from time to time on any Business Day, make a voluntary
prepayment, in whole or in part, of the outstanding principal amount of any
Loans; provided, however, that
-------- -------
(i) any such prepayment shall be made pro rata among Loans of
--- ----
the same Type and, if applicable, having the same Interest Period;
(2) no such prepayment of any Eurodollar Rate Loan may be made
on any day other than the last day of the Interest Period for such Loan unless
such payment shall be accompanied by all costs and expenses then payable under
Section 4.4;
-----------
32
(iii) all such voluntary prepayments of any Eurodollar Rate Loan shall
require at least three Business Days' prior written notice to the Administrative
Agent and all such voluntary partial prepayments shall be in an aggregate
minimum amount of $1,000,000 and integral multiples of $250,000 in excess
thereof or such lesser amount as will prepay such Loan in full;
(iv) all such voluntary prepayments of any Base Rate Loan outstanding
under the Revolving Loan Commitment shall require at least one Business Day's
notice, and all such voluntary partial prepayments shall be in an aggregate
minimum amount of $1,000,000 and integral multiples of $250,000 in excess
thereof or such lesser amount as will prepay such Loan in full; and
(v) all such voluntary prepayments of any Swing Loan shall require
at least one Business Day's notice to the Swingline Lender (unless notice shall
have been given by 12:00 noon, New York time and payment shall be received by
1:00 p.m. New York time, in which event one Business Day's notice shall not be
required), and all such voluntary partial prepayments shall be in an aggregate
minimum amount of $100,000 or integral multiples of $100,000 or such lesser
amount as will prepay such Loan in full.
(b) shall, on each Quarterly Payment Date set forth below, make a
scheduled repayment of the aggregate outstanding principal amount, if any, of
all Term Loans in the amount shown below opposite such Quarterly Payment Date:
August 31, 1998 through $ 250,000
and including
May 31, 2001
August 31, 2001 $ 3,000,000
Through and including
May 31, 2002
August 31, 2002 $ 5,000,000
Through and including
February 28, 2003
May 31, 2003 $10,000,000
In the event that the Term Loan Commitment Amount shall be increased pursuant to
Section 2.8 hereof, the reduction amounts shown above for all Quarterly Payment
-----------
Dates after the date of such increase will be ratably increased.
(c) shall, immediately upon any acceleration of the Stated Maturity
Date of any Loans pursuant to Section 8.2 or
-----------
33
Section 8.3, repay all Loans, unless, pursuant to Section 8.3, only a portion
----------- -----------
of all Loans is so accelerated.
Each voluntary prepayment of Term Loans made pursuant to clause (a) shall be
----------
applied, to the extent of such prepayment, to the pro rata reduction of the
--- ----
scheduled repayments of Term Loans set forth in clause (b); provided, that in
---------- --------
the case of a voluntary prepayment made no earlier than three months before the
next scheduled principal repayment of Term Loans set forth in clause (b) above,
----------
the Borrower shall have the right to apply such prepayment to the next such
scheduled principal repayment. Each prepayment of any Loans made pursuant to
this Section shall be without premium or penalty, except as may be required by
Section 4.4. No voluntary prepayment of principal of any Revolving Loans shall
-----------
cause a reduction in the Revolving Loan Commitment Amount.
SECTION 3.1.2. Special Swing Loan Provisions. All Swing Loans shall be
-----------------------------
payable with accrued interest thereon solely to the Swingline Lender for its own
account, and shall otherwise be subject to all the terms and conditions
applicable to the Revolving Loans (unless otherwise specifically set forth
herein). Upon the earlier to occur of (x) five Business Days after the making
of any Swing Loan or (y) one Business Day after the occurrence of an Event of
Default, the Borrower shall repay all of such Swing Loans in cash by 1:00 p.m.,
New York time, on the date due or make a Borrowing of Revolving Loans in an
amount at least equal to the aggregate outstanding principal amount of all such
Swing Loans together with all accrued interest thereon, and shall apply the
proceeds of such Borrowing to repay in its entirety the aggregate outstanding
principal amount of all such Swing Loans together with accrued interest thereon
to the date of such repayment.
In the event that any portion of any Swing Loan is not repaid when due, the
Swingline Lender shall promptly notify the Administrative Agent and the
Administrative Agent shall promptly, and in no event later than 5:00 p.m., New
York time, two Business Days after its receipt of such notice, notify each
Lender in writing of the unreimbursed amount of such Swing Loan and of such
Lender's Revolving Percentage of such unreimbursed amount. Each of the Lenders
shall make a Revolving Loan in an amount equal to such Lender's Revolving
Percentage of the unreimbursed amount of such Swing Loan, together with accrued
and unpaid interest thereon (to the extent that there is availability under the
Revolving Loan Commitment of such Lender), and pay the proceeds thereof, in
immediately available funds, directly to the Administrative Agent for the
account of the Swingline Lender, not later than 1:00 p.m., New York time, on the
next Business Day after the date such Lender is notified by the Administrative
Agent. Revolving Loans made by the Lenders to repay unreimbursed Swing Loans
pursuant to this Section shall constitute Revolving
34
Loans hereunder, initially shall be Base Rate Loans and shall be subject to all
of the provisions of this Agreement concerning Revolving Loans, except that such
Revolving Loans shall be made upon demand by the Administrative Agent as set
forth above rather than upon notice by the Borrower, and shall be made,
notwithstanding anything in this Agreement to the contrary, without regard to
satisfaction of conditions precedent to the making of Revolving Loans set forth
in Article V of this Agreement; provided, however that no Lender shall be
--------
obligated to make such Revolving Loans if, prior to the date of the Borrowing of
the Swing Loan to be refunded, the Swingline Lender had received written notice
from the Administrative Agent or any Lender of the existence and continuance of
an Event of Default.
Each Lender's obligation to make Revolving Loans in the amount of its
Revolving Percentage of any unreimbursed Swing Loan pursuant hereto is several,
and not joint or joint and several. The failure of any Lender to perform its
obligation to make a Revolving Loan in the amount of such Lender's Revolving
Percentage of any unreimbursed Swing Loan will not relieve any other Lender of
its obligation hereunder to make a Revolving Loan in the amount of such other
Lender's Revolving Percentage of such unreimbursed Swing Loan. Any Lender may,
but shall have no obligation to any Person to, assume all or any portion of any
non-performing Lender's obligation to make a Revolving Loan in the amount of
such Lender's Revolving Percentage of such unreimbursed Swing Loan. The
Borrower agrees to accept the Revolving Loans hereinabove provided, whether or
not such Loans could have been made pursuant to the terms of Section 5.2 hereof
-----------
or any other Section of this Agreement.
In the event, for whatever reason, the Administrative Agent determines that
the Lenders are not able to, or that it could be disadvantageous for the Lenders
to, advance their respective Revolving Percentage of Revolving Loans for the
purpose of refunding Swing Loans as required hereunder, then each of the Lenders
absolutely and unconditionally agrees to purchase and take from the Swingline
Lender on demand an undivided participation interest in Swing Loans outstanding
in an amount equal to their respective Revolving Percentage of such Swing Loans.
SECTION 3.1.3. Post Default Application of Payments. Notwithstanding
------------------------------------
any provision of Section 3.1.1 to the contrary, after the occurrence and during
-------------
the continuance of an Event of Default, all optional and mandatory payments
under Section 3.1.1 shall be applied first to pay any fees and expenses then due
-------------
and owing, second to the pro rata payment of accrued and unpaid interest on all
--- ----
Loans and third to the pro rata reduction of amounts outstanding under the Term
--- ----
Loan Commitment, the Revolving Loan Commitment and the Swingline Commitment.
35
SECTION 3.2. Interest Provisions. Interest on the outstanding
-------------------
principal amount of Loans shall accrue and be payable in accordance with this
Section 3.2.
-----------
SECTION 3.2.1. Rates. Pursuant to an appropriately delivered Borrowing
-----
Request or Continuation/Conversion Notice, the Borrower may elect that Loans
comprising a Borrowing accrue interest at a rate per annum:
(a) on that portion maintained from time to time as a Base Rate Loan,
equal to the sum of the Alternate Base Rate from time to time in effect
plus the Applicable Base Rate Margin in effect from time to time;
(b) on that portion maintained as a Eurodollar Rate Loan, during each
Interest Period applicable thereto, equal to the sum of the Eurodollar Rate
(Reserve Adjusted) for such Interest Period plus the Applicable Eurodollar
----
Rate Margin in effect from time to time.
All Eurodollar Rate Loans shall bear interest from and including the first
day of the applicable Interest Period to (but not including) the last day of
such Interest Period at the interest rate determined as applicable to such
Eurodollar Rate Loan.
SECTION 3.2.2. Post-Maturity Rates. After the date any principal
-------------------
amount of any Loan is due and payable (whether on the Stated Maturity Date, upon
acceleration or otherwise), or after any other monetary Obligation of the
Borrower shall have become due and payable, the Borrower shall pay, but only to
the extent permitted by law, interest (after as well as before judgment) on such
amounts at a rate per annum equal to the Alternate Base Rate plus 3.5% until
such amount is paid in full.
SECTION 3.2.3. Payment Dates. Interest accrued on each Loan shall be
-------------
payable, without duplication:
(a) on the Stated Maturity Date therefor;
(b) on the date of any payment or prepayment, in whole or in part, of
principal outstanding on such Loan;
(c) with respect to Base Rate Loans, on each Monthly Payment Date
occurring after the Effective Date;
(d) with respect to Eurodollar Rate Loans, the last day of each
applicable Interest Period (and, if such Interest Period shall exceed 90 days,
on the 90th day of such Interest Period);
36
(e) with respect to any Base Rate Loans converted into Eurodollar
Rate Loans on a day when interest would not otherwise have been payable pursuant
to clause (c), on the date of such conversion; and
----------
(f) on that portion of any Loans the Stated Maturity Date of which is
accelerated pursuant to Section 8.2 or Section 8.3, immediately upon such
----------- -----------
acceleration.
Interest accrued on Loans or other monetary Obligations arising under this
Agreement or any other Loan Document after the date such amount is due and
payable (whether on the Stated Maturity Date, upon acceleration or otherwise)
shall be payable upon demand.
SECTION 3.3. Fees. The Borrower agrees to pay the fees set forth in
----
this Section 3.3. All such fees shall be non-refundable.
-----------
SECTION 3.3.1. Commitment Fee. The Borrower agrees to pay to the
--------------
Administrative Agent for the account of each Lender, for the period (including
any portion thereof when its Revolving Loan Commitment is suspended by reason of
the Borrower's inability to satisfy any condition of Article V) commencing on
---------
the Effective Date and continuing through the Revolving Loan Commitment
Termination Date, a per annum fee (the "Commitment Fee") on the average daily
--------------
unused portion of the Revolving Loan Commitment Amount (without giving effect to
any reduction thereof as a result of any outstanding Swing Loans), calculated on
a 360-day basis using the basis points per annum rate as set forth under the
column labeled "Commitment Fee" in the definition of "Applicable Margin"
opposite the Borrower's Leverage Ratio. The Commitment Fee shall be payable by
the Borrower in arrears on each Quarterly Payment Date, commencing on August 31,
1998, and on any expiration or termination of the Revolving Loan Commitment.
SECTION 3.3.2. Upfront Fees. The Administrative Agent agrees to pay to
------------
each Lender upfront fees in such amounts as have been agreed upon previously by
the Administrative Agent and each such Lender.
SECTION 3.3.3. Administrative Agent's Fee. The Borrower hereby agrees
--------------------------
to pay to the Administrative Agent for its own account fees in such amounts and
at such times as more particularly set forth in the fee letter dated April 23,
1998.
SECTION 3.3.4. Letter of Credit Fees. The Borrower agrees to pay to
---------------------
the Administrative Agent, for the account of the Lenders, letter of credit fees
(the "L/C Fees") on the average daily face amount of outstanding Letters of
--------
Credit, calculated at
37
a per annum rate equal to the Applicable Eurodollar Rate Margin in effect for
Revolving Loans from time to time. The Borrower further agrees to pay to the
L/C Issuer, for its own account, a fronting fee (the "Fronting Fee") equal to
-------------
0.25% per annum of the average daily face amount of outstanding Letters of
Credit. The L/C Fees and the Fronting Fee shall be computed on the basis of a
year comprised of 360 days and shall be payable in arrears, on each Quarterly
Payment Date, commencing August 31, 1998.
SECTION 4.4. Agreement to Repay Letter of Credit Drawings with
-------------------------------------------------
Revolving Loans. The Borrower agrees to reimburse the L/C Issuer for each draft
---------------
that is paid under any Letter of Credit for the amount of (a) such draft and (b)
any reasonable taxes, fees, charges or other costs and expenses incurred by the
L/C Issuer in connection with such payment, whether such draft is paid before,
on or after termination of the Revolving Loan Commitment. Upon notice by the
L/C Issuer to the Borrower and the Administrative Agent (and notice by the
Administrative Agent to the Lenders pursuant to Section 3.5) on any day that
-----------
payment has been made under any Letter of Credit, the Borrower shall reimburse
the L/C Issuer with its own funds or with the proceeds of a Revolving Loan made
pursuant to Section 3.5 not later than the following Business Day. Interest
-----------
shall be payable on any and all unreimbursed amounts advanced by the L/C Issuer
under this Section from the date such amounts have been advanced by the L/C
Issuer until reimbursed at the rate of interest payable on Base Rate Loans.
The payment obligations of the Borrower under this Section shall be
unconditional and irrevocable and shall be paid strictly in accordance with the
terms of this Agreement under all circumstances, including without limitation,
the following circumstances:
(a) the existence of any claim, set-off, defense or other right which
the Borrower may have at any time against any beneficiary, or any
transferee, of any Letter of Credit (or any Persons for whom any such
beneficiary or any such transferee may be acting), the L/C Issuer or any
other Person, whether in connection with this Agreement, the transactions
contemplated herein, or any unrelated transaction;
(b) any statement or any other document presented under any Letter of
Credit proving to be forged, fraudulent, invalid or unenforceable in any
respect or any statement therein being untrue or inaccurate in any respect;
provided that any such statement or other document appears, on examination,
--------
to be regular on its face; or
38
(c) payment by the L/C Issuer under any Letter of Credit against
presentation of drafts, certificates, claims, documents or required
statements that do not strictly comply with the terms of the Letter of
Credit; provided that, upon examination, any such drafts, certificates,
--------
claims, documents or statements appear on their face to be in accordance
with the Letter of Credit.
SECTION 3.5. Letter of Credit Participations. The L/C Issuer
-------------------------------
irrevocably agrees to grant and hereby grants to each Lender, and, to induce the
L/C Issuer to issue Letters of Credit hereunder, each Lender irrevocably agrees
to accept and purchase and hereby accepts and purchases from the L/C Issuer for
such Lender's own account and risk an undivided interest equal to such Lender's
Revolving Percentage in the L/C Issuer's obligations and rights under each
Letter of Credit issued hereunder and each draft paid by the L/C Issuer
hereunder.
Upon presentation of a draft drawn under any Letter of Credit, the L/C
Issuer shall promptly notify the Administrative Agent and the Administrative
Agent shall promptly notify each Lender of the amount under such draft and of
such Lender's Revolving Percentage of such amount. Unless (i) the Borrower
shall have previously reimbursed the L/C Issuer for the amount of such draft or
(ii) there is a sufficient amount in any cash collateral account established
pursuant to Section 2.7 to cover payments to be made under such Letter of
-----------
Credit, each of the Lenders shall thereafter make a Revolving Loan in an amount
equal to such Lender's Revolving Percentage of the amount of such payment made
by the L/C Issuer, together with any accrued and unpaid interest thereon. Each
Lender shall pay the proceeds of its Revolving Loan, in immediately available
funds, directly to the Administrative Agent for the account of the L/C Issuer,
(i) not later than 1:00 p.m. New York time, on the following Business Day if the
Administrative Agent shall have provided notice prior to 11:30 a.m. New York
time, and (ii) if the Administrative Agent shall have provided notice after
11:30 a.m. New York time, not later than 1:00 p.m. New York time, on the second
following Business Day. Revolving Loans made by the Lenders to repay amounts
under Letters of Credit pursuant to this Section shall constitute Revolving
Loans hereunder, initially shall be Base Rate Loans and shall be subject to all
of the provisions of this Agreement concerning Revolving Loans, except that such
Revolving Loans shall be made upon demand by the Administrative Agent as set
forth above rather than upon notice by the Borrower, and shall be made,
notwithstanding anything in this Agreement to the contrary, without regard to
satisfaction of conditions precedent to the making of Revolving Loans set forth
in Article V of this Agreement and, notwithstanding any termination of the
---------
Revolving Loan Commitment prior to the Stated Maturity Date, Revolving Loans
shall be made to reimburse the L/C
39
Issuer for any drafts paid under any Letter of Credit outstanding on the date of
such termination.
Each Lender's obligation to make Revolving Loans in the amount of its
Revolving Percentage of any unreimbursed amounts outstanding under a Letter of
Credit pursuant hereto is several, and not joint or joint and several. The
failure of any Lender to perform its obligation to make a Revolving Loan in the
amount of such Lender's Revolving Percentage of any unreimbursed amounts
outstanding under a Letter of Credit will not relieve any other Lender of its
obligation hereunder to make a Revolving Loan in the amount of such other
Lender's Revolving Percentage of such amounts. Any Lender may, but shall have
no obligation to any Person to, assume all or any portion of any non-performing
Lender's obligation to make a Revolving Loan in the amount of such Lender's
Revolving Percentage of such amount outstanding under a Letter of Credit. The
Borrower agrees to accept the Revolving Loans hereinabove provided, whether or
not such loans could have been made pursuant to the terms of Section 5.2 hereof,
-----------
or any other Section of this Agreement.
SECTION 3.6. Existing Letters of Credit. On and after the Effective
--------------------------
Date, the Existing Letters of Credit shall be deemed for all purposes to be
Letters of Credit outstanding under this Agreement and entitled to the benefits
of this Agreement and the other Loan Documents, and shall be governed by the
applications and agreements pertaining thereto and by this Agreement. Each
Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the L/C Issuer on the Effective Date a participation in each such
Letter of Credit and each drawing thereunder in an amount equal to the product
of (i) such Lender's Revolving Percentage times (ii) the sum of the maximum
amount then available to be drawn under such Letter of Credit and the amount of
any amount drawn but not reimbursed under such Letter of Credit. For purposes
of Section 2.1.2, the Existing Letters of Credit shall be deemed to utilize pro
-------------
rata the Revolving Loan Commitment of each Lender.
ARTICLE IV
CERTAIN EURODOLLAR RATE AND OTHER PROVISIONS
SECTION 4.1. Eurodollar Rate Lending Unlawful. If any Lender shall
--------------------------------
determine (which determination shall, upon notice thereof to the Borrower and
the Lenders, be conclusive and binding on the Borrower) that the introduction of
or any change in or in the interpretation of any law, in each case after the
Effective Date, makes it unlawful, or any central bank or other governmental
authority asserts after the Effective Date that it is unlawful, for such Lender
to make, continue or maintain any Loan as, or to convert any Loan into, a
Eurodollar Rate Loan, the
40
obligations of such Lender to make, continue, maintain or convert any such Loans
shall, upon such determination, forthwith be suspended until such Lender shall
notify the Administrative Agent that the circumstances causing such suspension
no longer exist, and all Eurodollar Rate Loans of such Lender shall
automatically convert into Base Rate Loans at the end of the then current
Interest Periods with respect thereto or sooner, if required by such law or
assertion.
SECTION 4.2. Deposits Unavailable. If the Administrative Agent shall
--------------------
have determined after the Effective Date that
(a) Dollar deposits in the relevant amount and for the relevant
Interest Period are not available to CIBC; or
(b) by reason of circumstances affecting the interbank market,
adequate means do not exist for ascertaining the interest rate applicable
hereunder to Eurodollar Rate Loans,
then, upon notice from the Administrative Agent to the Borrower and the Lenders,
the obligations of all Lenders under Section 2.3 and Section 2.4 to make or
----------- -----------
continue any Loans as, or to convert any Loans into, Eurodollar Rate Loans shall
forthwith be suspended until the Administrative Agent shall notify the Borrower
and the Lenders that the circumstances causing such suspension no longer exist.
SECTION 4.3. Increased Costs, etc. The Borrower agrees to reimburse
--------------------
each Lender for any increase in the cost to such Lender of, or any reduction in
the amount of any sum receivable by such Lender in respect of, (i) making,
continuing or maintaining (or of its obligation to make, continue or maintain)
any Loans as, or of converting (or of its obligation to convert) any Loans into,
Eurodollar Rate Loans or (ii) any Letter of Credit (or any Lender's
participation therein) issued hereunder as a result of any change in, or the
introduction, adoption, effectiveness, interpretation, reinterpretation or
phase-in adopted after the Effective Date of, any law or regulation, directive,
guideline, decision or request (whether or not having force of law) of any
court, central bank, regulator or other governmental authority (whether or not
having the force of law and whether or not the failure to comply with such
guideline or requirement would be unlawful). Such Lender shall promptly notify
the Administrative Agent and the Borrower in writing of the occurrence of any
such event, such notice to state, in reasonable detail, the reasons therefor and
the additional amount required fully to compensate such Lender for such
increased cost or reduced amount. Such additional amounts shall be payable by
the Borrower directly to such Lender within 30 days of its receipt of such
notice, and such notice shall, in the absence of manifest error, be conclusive
and binding on the Borrower.
41
SECTION 4.4. Funding Losses. In the event any Lender shall incur any
--------------
loss or expense (including any loss or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by such Lender
to make, continue or maintain any portion of the principal amount of any Loan
as, or to convert any portion of the principal amount of any Loan into, a
Eurodollar Rate Loan) as a result of
(a) any conversion or repayment or prepayment of the principal amount
of any Eurodollar Rate Loans on a date other than the scheduled last day of
the Interest Period applicable thereto, whether pursuant to Section 3.1 or
-----------
otherwise;
(b) any Loans not being made as Eurodollar Rate Loans in accordance
with the Borrowing Request therefor; or
(c) any Loans not being continued as, or converted into, Eurodollar
Rate Loans in accordance with the Continuation/ Conversion Notice therefor,
then, upon the written notice of such Lender to the Borrower (with a copy to the
Administrative Agent), the Borrower shall, within 30 days of its receipt
thereof, pay directly to such Lender such amount as will (in the reasonable
determination of such Lender) reimburse such Lender for such loss or expense.
Such written notice (which shall include calculations in reasonable detail)
shall, in the absence of manifest error, be conclusive and binding on the
Borrower.
SECTION 4.5. Increased Capital Costs. If any change after the Effective
-----------------------
Date in, or the introduction, adoption, effectiveness, interpretation,
reinterpretation or phase-in after the Effective Date of, any law or regulation,
directive, guideline, decision or request (whether or not having the force of
law) of any court, central bank, regulator or other governmental authority
affects or would affect the amount of capital required or expected to be
maintained by any Lender or any Person controlling such Lender, and such Lender
determines (in its sole and absolute discretion) that the rate of return on its
or such controlling Person's capital as a consequence of its Commitments or the
Loans made by such Lender or any Letter of Credit issued by such Lender or in
which such Lender is a risk participant is reduced to a level below that which
such Lender or such controlling Person could have achieved but for the
occurrence of any such circumstance, then, in any such case upon notice
(containing an explanation in reasonable detail of the reasons therefor) from
time to time by such Lender to the Borrower, the Borrower shall immediately pay
directly to such Lender additional amounts sufficient to compensate such Lender
or such controlling Person for such reduction in rate of return. A
42
statement of such Lender as to any such additional amount or amounts (including
calculations thereof in reasonable detail) shall, in the absence of manifest
error, be conclusive and binding on the Borrower. In determining such amount,
such Lender may use any method of averaging and attribution that it (in its
reasonable discretion) shall deem applicable.
SECTION 4.6. Taxes. (a) All payments by the Borrower of principal of,
-----
and interest on, the Loans, all reimbursements by the Borrower of any amounts
drawn under a Letter of Credit and all other amounts payable hereunder
(including any payment required pursuant to Sections 4.1, 4.3, 4.4, 4.5 or 4.6)
-------- --- --- --- --- ---
shall be made free and clear of and without deduction for any present or future
income, excise, stamp or franchise taxes and other taxes, fees, duties,
withholdings or other charges of any nature whatsoever imposed by any taxing
authority, but excluding franchise taxes and taxes imposed on or measured by any
Lender's net income or receipts (such non-excluded items being called "Taxes").
-----
In the event that any withholding or deduction from any payment to be made by
the Borrower hereunder is required in respect of any Taxes pursuant to any
applicable law, rule or regulation, then the Borrower will
(i) pay directly to the relevant authority the full amount required
to be so withheld or deducted;
(ii) promptly forward to the Administrative Agent an official receipt
or other documentation reasonably satisfactory to the Administrative Agent
evidencing such payment to such authority; and
(iii) pay to the Administrative Agent for the account of the Lenders
such additional amount or amounts as is necessary to ensure that the net
amount actually received by each Lender will equal the full amount such
Lender would have received had no such withholding or deduction been
required.
Moreover, if any Taxes are directly asserted against the Administrative Agent or
any Lender with respect to any payment received by the Administrative Agent or
such Lender hereunder, the Administrative Agent or such Lender may pay such
Taxes and the Borrower will promptly pay such additional amounts (including any
penalties, interest or expenses) as is necessary in order that the net amount
received by such person after the payment of such Taxes (including any Taxes on
such additional amount) shall equal the amount such Person would have received
had not such Taxes been asserted.
If the Borrower fails to pay any Taxes when due to the appropriate taxing
authority or fails to remit to the
43
Administrative Agent, for the account of the respective Lenders, the required
receipts or other required documentary evidence, the Borrower shall indemnify
the Lenders for any incremental Taxes, interest or penalties that may become
payable by any Lender as a result of any such failure; provided that the
--------
Borrower's obligation to indemnify the Lenders hereunder shall not apply to any
Taxes imposed as a result of a Lender's or the L/C Issuer's failure to provide
documents to establish complete exemption from withholding taxes pursuant to
Section 4.6(c). For purposes of this Section 4.6, a distribution hereunder by
-------------- -----------
the Administrative Agent or any Lender to or for the account of any Lender shall
be deemed a payment by the Borrower.
(b) Each original Lender organized under the laws of a jurisdiction
outside the United States shall, on or prior to the date of its execution and
delivery of this Agreement, and on the date of the Lender Assignment Agreement
pursuant to which it became a Lender in the case of each other Lender organized
under the laws of a jurisdiction outside the United States, and from time to
time thereafter if any applicable form previously provided by such Lender is no
longer valid because such Lender has changed its applicable lending office or
its principal office, place of incorporation or fiscal residence or if otherwise
requested in writing by the Borrower or the Administrative Agent (but only so
long thereafter as such Lender remains lawfully able to do so), provide the
Administrative Agent and the Borrower with (i) an accurate, complete and duly
executed (x) Internal Revenue Service form 1001 or 4224, as appropriate, or any
successor form prescribed by the Internal Revenue Service, certifying 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 or (y) Internal Revenue Service Form W-8 or W-9, or any
successor form prescribed by the Internal Revenue Service, to establish that
such Lender is exempt from United States backup withholding tax, and (ii) in the
event that, by virtue of a change in law or regulations, such forms are no
longer valid evidence of a Person's exemption from withholding which is
reasonably satisfactory to the Borrower, other appropriate evidence supporting
such Person's exemption from withholding as the Borrower may reasonably request.
If the form provided by a Lender at the time such Lender first becomes a party
to this Agreement indicates a United States interest withholding tax rate in
excess of zero, withholding tax at such rate shall be considered excluded from
Taxes. If any form or document referred to in this subsection (b) requires the
disclosure of information, other than information necessary to compute the tax
payable and information required on the date hereof by Internal Revenue Service
form 1001, 4224, W-8 or W-9,
44
that the Lender reasonably considers to be confidential, the Lender shall give
notice thereof to the Borrower and shall not be obligated to include in such
form or document such confidential information.
(c) Each Lender and the L/C Issuer represents and warrants that, as of the
date such Person first becomes a party hereto, such Person is entitled to
receive payments under this Agreement without deduction or withholding of any
United States Federal income taxes or that such Person is entitled to an
exemption from United States withholding tax.
SECTION 4.7. Payments, Computations, etc. Unless otherwise expressly
---------------------------
provided, all payments by the Borrower pursuant to this Agreement, the Notes
(other than the Swingline Note) or any other Loan Document shall be made by the
Borrower to the Administrative Agent for the pro rata account of the Lenders
--- ----
entitled to receive such payment. All such payments required to be made to the
Administrative Agent shall be made, without setoff, deduction, recoupment or
counterclaim, not later than 1:00 p.m., New York time, on the date due, in same
day or immediately available funds, to such account as the Administrative Agent
shall reasonably specify from time to time by notice to the Borrower. Funds
received after that time shall be deemed to have been received by the
Administrative Agent on the next succeeding Business Day. The Administrative
Agent shall promptly remit in same day funds to each Lender its share, if any,
of such payments received by the Administrative Agent for the account of such
Lender. All interest, Commitment Fees, L/C Fees, Fronting Fees shall be
computed on the basis of the actual number of days (including the first day but
excluding the last day) occurring during the period for which such interest or
fee is payable over a year comprised of 360 days (or, in the case of interest on
a Base Rate Loan, 365 days or, if appropriate, 366 days). Whenever any payment
to be made shall otherwise be due on a day which is not a Business Day, such
payment shall (except as otherwise required by clause (c) of the definition of
----------
the term "Interest Period" with respect to Eurodollar Rate Loans) be made on the
---------------
next succeeding Business Day and such extension of time shall be included in
computing interest and fees, if any, in connection with such payment.
SECTION 4.8. Sharing of Payments. If any Lender shall obtain any
-------------------
payment or other recovery (whether voluntary, involuntary, by application of
setoff or otherwise) on account of any Loan (other than pursuant to the terms of
Sections 4.3, 4.4 and 4.5) in excess of its pro rata share of payments then or
------------ --- --- --- ----
therewith obtained by all Lenders, such Lender shall purchase from the other
Lenders such participations in Loans made by them as shall be necessary to cause
such purchasing Lender to share the excess payment or other recovery ratably
with each of them;
45
provided, however, that if all or any portion of the excess payment or other
-------- -------
recovery is thereafter recovered from such purchasing Lender, the purchase shall
be rescinded and each Lender which has sold a participation to the purchasing
Lender shall repay to the purchasing Lender the purchase price to the ratable
extent of such recovery together with an amount equal to such selling Lender's
ratable share (according to the proportion of (a) the amount of such selling
Lender's required repayment to the purchasing Lender to (b) the total amount
--
so recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered.
The Borrower agrees that any Lender so purchasing a participation from another
Lender pursuant to this Section may, to the fullest extent permitted by law,
exercise all its rights of payment (including pursuant to Section 4.9) with
-----------
respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation. If under any
applicable bankruptcy, insolvency or other similar law, any Lender receives a
secured claim in lieu of a setoff to which this Section applies, such Lender
shall, to the extent practicable, exercise its rights in respect of such secured
claim in a manner consistent with the rights of the Lenders entitled under this
Section to share in the benefits of any recovery on such secured claim. For the
purposes of determining a Lender's applicable pro rata share, all issued and
--- ----
outstanding Letters of Credit shall be considered Revolving Loans, and any
payments in respect thereof shall be deposited in the cash collateral
account established pursuant to Section 2.7 hereof. If any Letter of Credit
-----------
shall thereafter expire or terminate without being drawn, the amount previously
deposited into the cash collateral account in respect thereof shall be released
from the cash collateral account and distributed to the Lenders on a pro rata
--- ----
basis or, if no Loans shall be outstanding, delivered to the Borrower.
SECTION 4.9. Setoff. Each Lender shall, upon the occurrence and
------
continuation of any Event of Default described in clauses (a) through (d) of
----------- ---
Section 8.1.9 or, with the consent of the Required Lenders, upon the occurrence
-------------
and continuation of any Event of Default, have the right to appropriate and
apply to the payment of the Obligations owing to it (but only to the extent then
due), and (as security for such Obligations) the Borrower hereby grants to each
Lender a continuing security interest in, any and all balances, credits,
deposits, accounts or moneys of the Borrower then or thereafter maintained with
such Lender; provided, however, that any such appropriation and application
-------- -------
shall be subject to the provisions of Section 4.8. Each Lender agrees promptly
-----------
to notify the Borrower and the Administrative Agent after any such setoff and
application made by such Lender; provided, however, that the failure to give
-------- -------
such notice shall not affect the validity of such setoff and application. The
rights of each Lender under this Section are in addition to other rights
46
and remedies (including other rights of setoff under applicable law or
otherwise) which such Lender may have.
SECTION 4.10. Use of Proceeds. The Borrower shall apply the proceeds of
---------------
each Borrowing in accordance with the third recital.
----- -------
SECTION 4.11. Discretion of Lenders as to Manner of Funding.
---------------------------------------------
Notwithstanding any provision of this Agreement to the contrary, each Lender
shall be entitled to fund and maintain its funding of all or any part of its
Loans in any manner it sees fit, it being understood, however, that for the
purposes of this Agreement all determinations under Sections 4.1, 4.2, 4.3 and
------------ --- ---
4.4 shall be made as if such Lender had actually funded and maintained each
---
Eurodollar Loan during the Interest Period for such Loan through the purchase of
deposits having a maturity corresponding to the last day of such Interest Period
and bearing an interest rate equal to the Eurodollar Rate for such Interest
Period. Each Lender shall use reasonable efforts (consistent with its internal
policies and legal and regulatory restrictions) to take appropriate action,
including the selection of a jurisdiction of its Domestic Office or Eurodollar
Office or the changing of the jurisdiction of its Domestic Office or Eurodollar
Office, as the case may be, so as to avoid any suspension of such Lender's
obligations under Section 4.1 or the imposition of any increased costs
-----------
(including under Sections 4.3 and 4.5)or taxes or to reduce the amount of any
------------ ---
such increased costs or taxes which may thereafter accrue; provided that no such
--------
selection or change of the jurisdiction for its Domestic Office or Eurodollar
Office shall be made if, in the reasonable judgment of such Lender, such
selection or change would be disadvantageous to such Lender.
SECTION 4.12 Substitution. In the event that (x) any Lender's
------------
circumstances shall have caused the Lenders' obligations to make, or to continue
or convert outstanding Loans as or to, Eurodollar Rate Loans to be suspended
pursuant to Section 4.1 or (y) any Lender has demanded compensation under
-----------
Section 4.3 or 4.5, or becomes entitled to receive additional amounts under
----------- ---
Section 4.6 and so long as there does not exist a Default, the Borrower shall
-----------
have the right, with the consent of the Administrative Agent (which consent
shall not be unreasonably withheld), to designate an Eligible Assignee (which
may be one or more of the Lenders) as a substitute for such Lender, which
Eligible Assignee shall purchase the Note(s) (for a price equal to all
principal, interest, fees and costs then owed to such Lender including all
amounts required by Sections 4.1, 4.3, 4.4, 4.5 or 4.6) and assume the
-------- --- --- --- --- ---
Commitments of such Lender.
47
ARTICLE V
CONDITIONS TO BORROWING
SECTION 5.1. Initial Borrowing. The obligations of the Lenders to fund
-----------------
the initial Borrowing or the L/C Issuer to issue the initial Letter of Credit
shall be subject to the prior or concurrent satisfaction of each of the
conditions precedent set forth in this Section 5.1.
-----------
SECTION 5.1.1. Resolutions, etc. The Administrative Agent shall have
----------------
received from the Borrower a certificate, dated the date of the initial
Borrowing, of its Secretary or Assistant Secretary as to
(a) resolutions of its Board of Directors then in full force and
effect authorizing the execution, delivery and performance of this
Agreement, the Notes and each other Loan Document to be executed by it; and
(b) the incumbency and signatures of those of its officers authorized
to act with respect to this Agreement, the Notes and each other Loan
Document executed by it; and
(c) the Borrower's certificate of incorporation and by-laws
upon which certificate each Lender may conclusively rely until it shall have
received a further certificate of the Secretary of the Borrower canceling or
amending such prior certificate; and the Administrative Agent shall have
received from each Guarantor a certificate, dated the date of the initial
Borrowing, of its Secretary or Assistant Secretary as to
(a) resolutions of the Board of Directors of such Guarantor then in
full force and effect authorizing the execution, delivery and performance
of its Guaranty and each other Loan Document to be executed by it;
(b) the incumbency and signatures of those of its officers authorized
to act with respect to its Guaranty, and each other Loan Document to be
executed by it; and
(c) its articles or certificate of incorporation and by-laws,
upon which certificate each Lender may conclusively rely until it shall have
received a further certificate of the Secretary of such Guarantor canceling or
amending such prior certificate. In addition, the Administrative Agent shall
have received from the Borrower and each Guarantor a certificate, dated not
earlier than
48
May 1, 1998 from the Secretary of State of each State in which such Person is
qualified to do business confirming the good standing in that State of that
Borrower or Guarantor, as the case may be.
SECTION 5.1.2. Delivery of Notes. The Administrative Agent shall have
-----------------
received, for the account of each Lender, the Notes duly executed and delivered
by the Borrower.
SECTION 5.1.3. Guaranty. The Administrative Agent shall have received
--------
the Guaranty, dated the date hereof, duly executed by each of the Guarantors.
SECTION 5.1.4. Payment of Outstanding Indebtedness, etc. All
----------------------------------------
Indebtedness identified in Item 7.2.2(b) ("Indebtedness to be Paid") of the
-------------
Disclosure Schedule, together with all interest, all prepayment premiums and
other amounts due and payable with respect thereto, shall have been paid in full
(including, to the extent necessary, from proceeds of the initial Borrowing);
and all Liens securing payment of any such Indebtedness have been released and
the Administrative Agent shall have received all Uniform Commercial Code Form
UCC-3 termination statements or other instruments as may be suitable or
appropriate in connection therewith.
SECTION 5.1.5. Security Agreement. The Administrative Agent shall have
------------------
received executed counterparts of the Security Agreement, dated as of the date
hereof, duly executed by the Borrower and each of the Guarantors, covering
(subject to the terms, conditions and limitations of such Security Agreement)
all of each such Person's equipment, fixtures, furnishings, inventory, accounts,
intangibles, capital stock and other personal property of every kind and
description, including, to the extent permitted by the terms of the financing or
leasing agreements applicable thereto, all furniture, fixtures and equipment
that are financed or leased (all of the foregoing, subject to any limitations
and exclusions in the Security Agreement, is collectively referred to as the
"Personal Property Collateral"), together with
-----------------------------
(a) executed copies of Uniform Commercial Code financing statements
(Form UCC-1), naming the Borrower and each of the Guarantors as the debtor
and the Administrative Agent as the secured party, or other similar
instruments or documents, to be filed under the Uniform Commercial Code of
all jurisdictions as may be necessary or, in the opinion of the
Administrative Agent, desirable to perfect the security interest of the
Administrative Agent pursuant to the Security Agreement;
49
(b) executed copies of proper Uniform Commercial Code Form UCC-3
termination statements, if any, necessary to release all Liens (other than
those permitted hereunder) in any collateral described in the Security
Agreement together with such other Uniform Commercial Code Form UCC-3
termination statements as the Administrative Agent may reasonably request);
and
(c) certified copies of Uniform Commercial Code Requests for
Information or Copies (Form UCC-11), or a similar search report certified
by a party acceptable to the Administrative Agent, dated a date reasonably
near to the date of the initial Borrowing, listing all effective financing
statements which name the Borrower and the Guarantors (under their present
names and any previous names) as the debtor and which are filed in the
jurisdictions in which filings are to be made pursuant to clause (a) above,
----------
together with copies of such financing statements (none of which shall
cover any collateral described in the Security Agreement).
SECTION 5.1.6. Consents, etc. The Administrative Agent shall have
--------------
received certified copies of all documents evidencing any necessary corporate
action of the Borrower, material consents, shareholder, creditor, lessor (other
than the lessor consents required in connection with the Leasehold Deeds of
Trust), governmental and material regulatory approvals or exemptions in
connection with this Agreement, all in form and substance reasonably
satisfactory to the Administrative Agent and, as to legal matters, its counsel.
SECTION 5.1.7. Solvency. The Administrative Agent shall have received a
--------
certificate substantially in the form of Exhibit J hereto from the president,
---------
the chief executive or chief financial Authorized Officer of the Borrower as to
solvency of the Borrower and the Guarantors, taken as a whole, both before and
immediately after giving effect to the initial Borrowing or the issuance of the
initial Letter of Credit.
SECTION 5.1.8. Opinions of Counsel. The Administrative Agent shall have
-------------------
received opinions, dated the date of the initial Borrowings and addressed to the
Administrative Agent and all Lenders, from ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, special counsel to
the Borrower, substantially in the form of Exhibit G hereto.
---------
SECTION 5.1.9. Satisfactory Legal Form. All documents executed or
-----------------------
submitted pursuant hereto by or on behalf of the Borrower or any of its
Subsidiaries shall be satisfactory in form and substance to the Administrative
Agent and its counsel; the Administrative Agent and its counsel shall have
received all
50
information, approvals, opinions, documents or instruments as the Administrative
Agent or its counsel may reasonably request.
SECTION 5.1.10. Closing Fees, Expenses, etc. The Administrative Agent
---------------------------
shall have received for its own account, or for the account of each Lender, as
the case may be, all fees, costs and expenses due and payable pursuant to
Sections 3.3 and 10.3, if then invoiced.
------------ ----
SECTION 5.2. All Borrowings. Subject to the provisions of Sections 2.7
-------------- ------------
and 3.1.2, the obligation of the L/C Issuer to issue any Letter of Credit or of
------
each Lender to fund any Loan on the occasion of any Borrowing (including the
initial Borrowing) shall be subject to the satisfaction of each of the
conditions precedent set forth in this Section 5.2.
-----------
SECTION 5.2.1. Compliance with Warranties, No Default, etc. Both before
-------------------------------------------
and after giving effect to the issuance of a Letter of Credit or any Borrowing
the following statements shall be true and correct
(a) the representations and warranties set forth in Article VI shall
----------
be true and correct in all material respects with the same effect as if
then made (unless stated to relate solely to an earlier date, in which case
such representations and warranties shall be true and correct as of such
earlier date); and
(b) no Default shall have then occurred and be continuing.
SECTION 5.2.2. Borrowing Request. The Administrative Agent shall have
-----------------
received a Borrowing Request for such Borrowing. Each of the delivery of a
Borrowing Request and the acceptance by the Borrower of the proceeds of such
Borrowing shall constitute a representation and warranty by the Borrower that on
the date of such Borrowing (both immediately before and after giving effect to
such Borrowing and the application of the proceeds thereof) the statements made
in Section 5.2.1 are true and correct in all material respects. Each request by
-------------
the Borrower for the issuance of a Letter of Credit shall be made pursuant to a
Letter of Credit application in the L/C Issuer's then current form. Delivery of
such application and the delivery by the L/C Issuer of the Letter of Credit
shall constitute a representation and warranty by the Borrower that on the date
of issuance of such Letter of Credit (both immediately before and after giving
effect thereto) the statements made in Subsection 5.2.1 are true and correct in
----------------
all material respects. Each request by the Borrower for Borrowings of Swing
Loans and the acceptance by the Borrower of the proceeds of such Swing Loans
shall constitute a representation and warranty by the Borrower that on the date
of
51
such Borrowing (both immediately before and after giving effect to such
Borrowing) the statements made in Subsection 5.2.1 are true and correct in all
----------------
material respects.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders and the Administrative Agent to enter into
this Agreement and to make Loans and issue Letters of Credit hereunder, the
Borrower represents and warrants unto the Administrative Agent and each Lender
as set forth in this Article VI.
----------
SECTION 6.1. Organization, etc. The Borrower and each of its
-----------------
Subsidiaries is a corporation validly organized and existing and in good
standing under the laws of the jurisdiction of its incorporation, is duly
qualified to do business and is in good standing as a foreign corporation in
each jurisdiction where the nature of its business requires such qualification,
and has full power and authority and holds all requisite governmental licenses,
permits and other approvals to enter into and perform its Obligations under this
Agreement, the Notes and each other Loan Document to which it is a party and to
own and hold under lease its property and to conduct its business substantially
as currently conducted by it, except, in each case, where the failure to be so
or to do so could not reasonably be expected to have a Material Adverse Effect.
SECTION 6.2. Due Authorization, Non-Contravention, etc. The execution,
-----------------------------------------
delivery and performance by the Borrower of this Agreement, the Notes and each
other Loan Document executed or to be executed by it, and the execution,
delivery and performance by each Guarantor of each Loan Document executed or to
be executed by it, are within each such Person's corporate powers, have been
duly authorized by all necessary corporate action, and do not
(a) contravene the Person's Organic Documents;
(b) contravene any material contractual restriction, law or
governmental regulation or material court decree or order binding on or
affecting the Borrower or any Guarantor; or
(c) result in, or require the creation or imposition of, any Lien on
any of any Obligor's properties (other than Liens created pursuant to the
Collateral Documents).
52
SECTION 6.3. Government Approval, Regulation, etc. Except for such
------------------------------------
authorizations, approvals or notices obtained or delivered as of the Effective
Date or subsequently required in connection with the addition of any Guarantor
pursuant to Section 7.1.9, no material authorization or approval or other action
-------------
by, and no notice to or filing with, any governmental authority or regulatory
body or other Person is required for the due execution, delivery or performance
by the Borrower or any other Obligor of this Agreement, the Notes or any other
Loan Document to which such Person is a party. Neither the Borrower nor any of
its Subsidiaries is an "investment company" within the meaning of the Investment
Company Act of 1940, as amended, or 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.
SECTION 6.4. Validity, etc. This Agreement constitutes, and the Notes
-------------
and each other Loan Document executed by the Borrower will, on the due execution
and delivery thereof, constitute, the legal, valid and binding obligations of
the Borrower enforceable against the Borrower in accordance with their
respective terms; and each Loan Document executed pursuant hereto by each other
Obligor will, on the due execution and delivery thereof by such Obligor, be the
legal, valid and binding obligation of such Obligor enforceable in accordance
with its terms.
SECTION 6.5. Financial Information. The audited consolidated balance
---------------------
sheet of the Borrower and its Subsidiaries as at October 31, 1997, and the
unaudited consolidated balance sheet of the Borrower and its Subsidiaries as at
January 31, 1998 and the related consolidated statements of earnings and cash
flow of the Borrower and its Subsidiaries, copies of which have been furnished
to the Administrative Agent for delivery to each Lender, have been prepared in
accordance with GAAP consistently applied, and present fairly the consolidated
financial condition of the corporations covered thereby as at the dates thereof
and the results of their operations for the periods then ended.
SECTION 6.6. No Material Adverse Change. Since October 31, 1997, there
--------------------------
has been no material adverse change in the financial condition, operations,
assets, business or properties of the Borrower and its Subsidiaries, taken as a
whole.
SECTION 6.7. Litigation, Labor Controversies, etc. Except as disclosed
------------------------------------
by the Borrower to the Administrative Agent and the Lenders pursuant to Item 6.7
--------
("Litigation") of the Disclosure Schedule
----------
53
(a) no labor controversy, litigation, action, arbitration or
governmental investigation or proceeding shall be pending or, to the knowledge
of the Borrower, threatened against the Borrower or any of its Subsidiaries
which could reasonably be expected to have a Material Adverse Effect; and
(b) no development shall have occurred since the Effective Date in
any labor controversy, litigation, arbitration or governmental investigation or
proceeding disclosed pursuant to Item 6.7 ("Litigation") of the Disclosure
Schedule which could reasonably be expected to have a Material Adverse Effect.
SECTION 6.8. Subsidiaries. The Borrower has no Subsidiaries, except
------------
those Subsidiaries
(a) which are identified in Item 6.8 ("Existing Subsidiaries") of the
--------
Disclosure Schedule; or
(b) which are permitted to have been acquired or formed in accordance
with Section 7.2.5 or 7.2.9.
------------- -----
SECTION 6.9. Ownership of Properties. The Borrower and each of its
-----------------------
Subsidiaries owns good and marketable title to all of its material properties
and assets, real and personal, tangible and intangible, of any nature whatsoever
(including patents, trademarks, trade names, service marks and copyrights), free
and clear of all Liens, charges or claims (including infringement claims with
respect to patents, trademarks, copyrights and the like) except as permitted
pursuant to Section 7.2.3. The provisions of the Leasehold Deeds of Trust when
-------------
executed and delivered will be, and the provisions of the Security Agreement are
effective, to create in favor of the Administrative Agent (for the benefit of
the Lenders), valid and perfected first priority Liens except as otherwise
permitted herein on the property described therein. All governmental approvals
necessary or, in the reasonable opinion of the Administrative Agent, desirable
to perfect and protect, and establish and maintain the priority of, such Liens
have been duly effected or taken.
SECTION 6.10. Compliance. The Borrower and the Guarantors are in
----------
compliance with all presently existing applicable statutes, laws, regulations,
rules, ordinances and orders of any kind whatsoever (including, but not limited
to, any zoning and building laws or ordinances, subdivision laws or ordinances,
any Environmental Laws, or any presently existing rules, regulations or orders
of any governmental entity, authority or agency) (all of which are sometimes
hereinafter collectively referred to as "Laws"), and with all presently existing
----
covenants and restrictions of record relating to the use and occupancy of any of
their respective properties, except where
54
the failure to so comply could not reasonably be expected to have a Material
Adverse Effect.
SECTION 6.11. Taxes. The Borrower and each of its Subsidiaries has
-----
filed all material tax returns and reports required by law to have been filed by
it and has paid all material taxes and governmental charges thereby shown to be
owing, except any such taxes or charges which are being diligently contested in
good faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on its books.
SECTION 6.12. Pension and Welfare Plans. During the twelve-consecutive-
-------------------------
month period prior to the date of the execution and delivery of this Agreement
and prior to the date of any Borrowing hereunder, no steps have been taken to
terminate any Pension Plan with respect to which the Borrower could be expected
to have any material liability, and no contribution failure has occurred with
respect to any Pension Plan sufficient to give rise to a Lien under section
302(f) of ERISA. No condition exists or event or transaction has occurred with
respect to any Pension Plan which could reasonably be expected to result in the
incurrence by the Borrower or any member of the Controlled Group of any material
liability, fine or penalty. Except as disclosed in Item 6.12 ("Employee Benefit
---------
Plans") of the Disclosure Schedule, neither the Borrower nor any member of the
Controlled Group has any contingent liability with respect to any post-
retirement benefit under a Welfare Plan, other than liability for continuation
coverage described in Part 6 of Title I of ERISA or similar state laws.
SECTION 6.13. Environmental Warranties.
------------------------
(a) (i) Except as has not had and is not reasonably likely to have a
Material Adverse Effect, the operations and properties of the Borrower and
each of its Subsidiaries comply in all material respects with all
Environmental Laws, all necessary Environmental Permits have been obtained
and are in effect for the operations and properties of the Borrower and its
Subsidiaries and the Borrower and its Subsidiaries are in compliance in all
material respects with all such Environmental Permits, and (ii) no
circumstances exist that would be reasonably likely to (A) form the basis
of an Environmental Action against the Borrower or any of its Subsidiaries
or any of their properties that would be reasonably likely to have a
Material Adverse Effect or (B) cause any such property to be subject to any
restrictions on ownership, occupancy, use or transferability under any
Environmental Law that would be reasonably likely to have a Material
Adverse Effect;
55
(b) except as has not had and is not reasonably likely to have a
Material Adverse Effect, (i) none of the properties of the Borrower or any
of its Subsidiaries is listed or, to the Borrower's knowledge, is proposed
for listing on the National Priorities List under CERCLA or on the CERCLIS
maintained by the Environmental Protection Agency or any analogous state
list of sites requiring investigation or cleanup or is adjacent to any such
property, and (ii) no underground storage tanks, as such term is defined in
42 U.S.C.(S) 6991, are located on any property of the Borrower or any of
its Subsidiaries or, to the Borrower's knowledge, on any adjoining
property; and
(c) except as has not had and is not reasonably likely to have a
Material Adverse Effect, (i) neither the Borrower nor any of its
Subsidiaries has transported or arranged for the transportation of any
Hazardous Materials to any location that is listed or proposed for listing
on the National Priorities List under CERCLA or on the CERCLIS maintained
by the Environmental Protection Agency or any analogous state list, (ii)
Hazardous Materials have not been generated, used, treated, handled, stored
or disposed of on, or released or transported to or from, any property of
Borrower or any of its Subsidiaries or, to the Borrower's knowledge, any
adjoining property, except in compliance with all Environmental Laws and
Environmental Permits, and (iii) all other wastes generated at any such
properties have been disposed of in compliance with all Environmental Laws
and Environmental Permits.
SECTION 6.14. Existing Subordinated Debt. As of the date of the initial
--------------------------
Borrowing, the outstanding principal amount of the Existing Subordinated Debt is
$15,000,000.
SECTION 6.15. Regulations U and X. The Borrower is not engaged in the
-------------------
business of extending credit for the purpose of purchasing or carrying margin
stock, and no proceeds of any Loans will be used for a purpose which violates
F.R.S. Board Regulation U or X. Terms for which meanings are provided in F.R.S.
Board Regulation U or X or any regulations substituted therefor, as from time to
time in effect, are used in this Section with such meanings.
SECTION 6.16. Accuracy of Information. All factual information
-----------------------
heretofore or contemporaneously furnished by or on behalf of (and reviewed by)
the Borrower in writing to the Administrative Agent or any Lender for purposes
of or in connection with this Agreement or any transaction contemplated hereby
is, and all other such factual information hereafter furnished by or on behalf
of (and reviewed by) the Borrower to the Administrative Agent or any Lender in
writing for purposes of
56
or in connection with this Agreement or any transaction contemplated hereby will
be, true and accurate in every material respect on the date as of which such
information is dated or certified and as of the date of execution and delivery
of this Agreement by the Administrative Agent and such Lender, and such
information is not, or shall not be, as the case may be, in light of the
circumstances when made, incomplete by omitting to state any material fact
necessary to make such information not misleading.
ARTICLE VII
COVENANTS
SECTION 7.1. Affirmative Covenants. The Borrower agrees with the
---------------------
Administrative Agent and each Lender that, until all Commitments have
terminated, all Letters of Credit have expired or been cash-collateralized, the
Loans have been repaid in full and all other amounts then due and payable have
been paid in full, the Borrower will perform the obligations set forth in this
Section 7.1.
-----------
SECTION 7.1.1. Financial Information, Reports, Notices, etc. The
--------------------------------------------
Borrower will furnish, or will cause to be furnished, to the Administrative
Agent for delivery to each Lender copies of the following financial statements,
reports, notices and information:
(a) as soon as available and in any event within 50 days after the
end of each of the first three Fiscal Quarters of each Fiscal Year of the
Borrower, the consolidated balance sheet of the Borrower and its
Subsidiaries as of the end of such Fiscal Quarter and consolidated
statements of earnings and cash flow of the Borrower and its Subsidiaries
for such Fiscal Quarter and for the period commencing at the end of the
previous Fiscal Year of the Borrower and ending with the end of such Fiscal
Quarter, certified by the chief financial Authorized Officer of the
Borrower;
(b) as soon as available and in any event within 95 days after the
end of each Fiscal Year of the Borrower, a copy of the Form 10-K report for
such Fiscal Year for the Borrower, including therein a consolidated balance
sheet of the Borrower and its Subsidiaries as of the end of such Fiscal
Year and consolidated statements of earnings and cash flow of the Borrower
and its Subsidiaries for such Fiscal Year, in each case certified (without
any Impermissible Qualification) by Ernst & Young LLP or other independent
public accountants reasonably acceptable to the Administrative Agent, with
a written statement of such
57
independent certified public accountants that nothing has come to their
attention to cause such independent certified public accountants to believe
that the calculations contained in the Authorized Officer's certificate
delivered pursuant to this clause (b) (together with such financial
statements) are inaccurate, and together with a certificate from the chief
financial Authorized Officer of the Borrower containing a computation of,
and showing compliance (or lack thereof) with, each of the financial ratios
and restrictions contained in Section 7.2.4 and confirming that such
-------------
officer has not become aware of any Default or Event of Default that has
occurred and is continuing, or, if he has become aware of such Default or
Event of Default, describing such Default or Event of Default and the
steps, if any, being taken to cure it;
(c) as soon as available and in any event within 50 days after the
end of each of the first three Fiscal Quarters of each Fiscal Year of the
Borrower, a certificate, executed by the chief financial Authorized Officer
of the Borrower, showing (in reasonable detail and with appropriate
calculations and computations in all respects satisfactory to the
Administrative Agent) compliance (or lack thereof) with the financial
covenants set forth in Section 7.2.4;
-------------
(d) as soon as possible and in any event within 50 days after the end
of each Fiscal Year of the Borrower, a computation of the Leverage Ratio as
of the end of such Fiscal Year, certified by the chief financial Authorized
Officer of the Borrower;
(e) as soon as possible and in any event within three Business Days
after the occurrence and continuation of each Default, a statement of the
chief financial Authorized Officer of the Borrower setting forth details of
such Default and the action which the Borrower has taken and proposes to
take with respect thereto;
(f) as soon as possible and in any event within five Business Days
after (x) the occurrence of any materially adverse development with respect
to any litigation, action, proceeding, or labor controversy described in
Section 6.7 or (y) the commencement of any labor controversy, litigation,
-----------
action, proceeding of the type described in Section 6.7, notice thereof and
-----------
a description of such event;
(g) subject to Section 7.1.1(b) hereof, promptly after the sending or
----------------
filing thereof, copies of all reports which the Borrower sends to any of
its security holders, and all reports and registration statements which the
Borrower or
58
any of its Subsidiaries files with the Securities and Exchange Commission;
(h) within thirty days after the beginning of each Fiscal Year of the
Borrower, consolidated financial projections for the Borrower and its
Subsidiaries (with appropriate detail for business lines) for such Fiscal
Year, in reasonable detail and in all respects reasonably satisfactory to
the Administrative Agent;
(i) promptly upon becoming aware of the institution of any steps by
the Borrower or any other Person to terminate any Pension Plan with respect
to which the Borrower could reasonably be expected to have any material
liability, or the failure to make a required contribution to any Pension
Plan if such failure is sufficient to give rise to a Lien under section
302(f) of ERISA, or the taking of any action with respect to a Pension Plan
which could reasonably be expected to result in the requirement that the
Borrower furnish a bond or other security to the PBGC or such Pension Plan,
or the occurrence of any event with respect to any Pension Plan which could
result in the incurrence by the Borrower of any material liability, fine or
penalty, or any material increase in the contingent liability of the
Borrower with respect to any post-retirement Welfare Plan benefit, notice
thereof and a description of such event; and
(j) such other information respecting the condition or operations,
financial or otherwise, of the Borrower or any of its Subsidiaries as any
Lender through the Administrative Agent may from time to time reasonably
request.
SECTION 7.1.2. Compliance with Laws, etc. Except where the failure to
--------------------------
do so could not reasonably be expected to have a Material Adverse Effect, the
Borrower will, and will cause each of its Subsidiaries to, comply in all
material respects with all applicable laws, rules, regulations and orders, such
compliance to include (without limitation):
(a) subject to Section 7.2.9 and Section 7.2.10, the maintenance and
------------- --------------
preservation of its corporate existence and qualification as a foreign
corporation; and
(b) the payment, before the same become delinquent, of all taxes,
assessments and governmental charges imposed upon it or upon its property
except to the extent being diligently contested in good faith by
appropriate proceedings and for which adequate reserves in accordance with
GAAP shall have been set aside on its books.
59
SECTION 7.1.3. Maintenance of Properties. The Borrower will, and will
-------------------------
cause each of its Subsidiaries to, maintain, preserve, protect and keep its
material properties in good repair, working order and condition (ordinary wear
and tear excepted), and make necessary and proper repairs, renewals and
replacements so that its business carried on in connection therewith may be
properly conducted at all times unless the Borrower determines in good faith
that the continued maintenance of any of its properties is no longer
economically desirable.
SECTION 7.1.4. Insurance. The Borrower will, and will cause each of
---------
its Subsidiaries to, maintain or cause to be maintained with responsible
insurance companies insurance with respect to its properties and business
(including business interruption insurance) against such casualties and
contingencies and of such types and in such amounts as is customary in the case
of similar businesses and will, upon request of the Administrative Agent,
furnish to each Lender at reasonable intervals a certificate of an Authorized
Officer of the Borrower setting forth the nature and extent of all insurance
maintained by the Borrower and its Subsidiaries in accordance with this Section.
SECTION 7.1.5. Books and Records. The Borrower and its Subsidiaries
-----------------
will keep books and records which accurately reflect all of their business
affairs and transactions and permit the Administrative Agent and each Lender or
any of their respective representatives, at reasonable times and intervals and
at the expense of the Administrative Agent or Lender, as applicable, upon prior
written notice to visit all of their offices, to discuss their financial matters
with their officers and independent public accountant (and the Borrower hereby
authorizes such independent public accountant to discuss the Borrower's
financial matters with each Lender or its representatives whether or not any
representative of the Borrower is present) and to examine (and photocopy
extracts from) any of its books or other corporate records. After the
occurrence and during the continuance of an Event of Default, the Borrower shall
pay any fees of such independent public accountant and any other expenses
incurred in connection with the Administrative Agent's or any Lender's exercise
of its rights pursuant to this Section.
SECTION 7.1.6. Environmental Covenant. The Borrower will, and will
----------------------
cause each of its Subsidiaries to,
(a) use and operate all of its facilities and properties in material
compliance with all Environmental Laws, keep all necessary permits,
approvals, certificates, licenses and other authorizations relating to
environmental matters in effect and remain in material compliance
therewith, and handle all Hazardous Materials in material
60
compliance with all applicable Environmental Laws except where the failure
to do so could not reasonably be expected to have a Material Adverse
Effect;
(b) immediately notify the Administrative Agent and provide copies
upon receipt of all written claims, complaints, notices or inquiries
relating to the condition of its facilities and properties or compliance
with Environmental Laws that could reasonably be expected to have a
Material Adverse Effect, and shall promptly commence and diligently proceed
to cure, to the reasonable satisfaction of the Administrative Agent any
actions and proceedings relating to violations of compliance with
applicable Environmental Laws that could reasonably be expected to have a
Material Adverse Effect; and
(c) provide such information and certifications which the
Administrative Agent may reasonably request from time to time to evidence
compliance with this Section 7.1.6.
-------------
SECTION 7.1.7. Maintenance of Existence. The Borrower will take all
------------------------
action necessary to maintain its corporate existence and the corporate existence
of each Guarantor except as permitted by Sections 7.2.9 and 7.2.10.
-------------- ------
SECTION 7.1.8. Accuracy of Information. All factual information
-----------------------
furnished after the date of execution and delivery of this Agreement by or on
behalf of (and reviewed by) either the Borrower or any Guarantor in writing to
the Administrative Agent or any Lender for purposes of or in connection with
this Agreement or any transaction contemplated hereby will be true and accurate
in every material respect on the date as of which such information is dated or
certified, and such information shall not in light of the circumstances when
made be incomplete by omitting to state any material fact necessary to make such
information not misleading.
SECTION 7.1.9. Additional Guaranties and Collateral Documentation.
--------------------------------------------------
Promptly upon the determination that any Person has become a domestic
Subsidiary, the Borrower will cause such Subsidiary to execute and deliver a
Guaranty and such Collateral Documents as the Administrative Agent may
reasonably request to effect the pledge of all of such Person's tangible and
intangible assets.
SECTION 7.1.10. Leasehold Deeds of Trust. The Borrower shall use its
------------------------
best efforts to deliver to the Administrative Agent on or before July 31, 1998,
executed counterparts of the Leasehold Deeds of Trust, duly executed by
▇▇▇▇▇▇▇▇▇ Controls or the Borrower, as appropriate, together with
61
(i) evidence of the completion (or satisfactory arrangements for the
completion) of all recordings and filings of the Leasehold Deeds of Trust
as may be necessary or, in the reasonable opinion of the Administrative
Agent, desirable effectively to record the Leasehold Deeds of Trust as
valid, perfected Liens against the property described therein, which Liens
are subject to no outstanding Liens securing Indebtedness for borrowed
money;
(ii) title policies (collectively, the "Title Policies") in favor of
--------------
the Administrative Agent on behalf of the Lenders in amounts and in form
and substance reasonably satisfactory to the Administrative Agent and
issued by the Title Company, with respect to the Leasehold Deeds of Trust;
and
(iii) such other consents, estoppels, approvals, opinions, or
documents in connection with the foregoing as the Administrative Agent may
reasonably request; provided, that neither the Borrower nor ▇▇▇▇▇▇▇▇▇
--------
Controls shall be required to deliver a landlord consent or estoppel which
would require the expenditure of cash or the making of any material
concessions under the relevant lease.
SECTION 7.1.11. Hazardous Materials Indemnity. The Borrower shall use
-----------------------------
its best efforts to deliver to the Administrative Agent on or before July 31,
1998 the Hazardous Materials Indemnity, duly executed by the Borrower and
▇▇▇▇▇▇▇▇▇ Controls.
SECTION 7.2. Negative Covenants. The Borrower agrees with the
------------------
Administrative Agent and each Lender that, until all Commitments have
terminated, all Letters of Credit have expired or been cash-collateralized, the
Loans have been repaid in full
[Remainder of Page is Intentionally Blank]
62
and all other amounts then due and payable have been paid in full, the Borrower
will perform the obligations set forth in this Section 7.2.
-----------
SECTION 7.2.1. Business Activities. The Borrower will not, and will
-------------------
not permit any of its Subsidiaries to, engage in any business activity, except
for the manufacture and sale of components and related systems for use in
aerospace and industrial applications in a manner consistent with their business
activities as of the Effective Date and such activities as may be incidental or
related thereto. Without limitation of the foregoing, Aviant Information, Inc.,
▇▇▇▇▇▇▇▇▇ Communications and ▇▇▇▇▇▇▇▇▇ Power Storage shall not engage in any
business activity other than those engaged in as of the Effective Date.
SECTION 7.2.2. Indebtedness. The Borrower will not, and will not
------------
permit any of its Subsidiaries to, create, incur, assume or suffer to exist or
otherwise become or be liable in respect of any Indebtedness, other than,
without duplication, the following:
(a) Indebtedness in respect of the Loans and other Obligations;
(b) until the date of the initial Borrowing, Indebtedness identified
in Item 7.2.2(b) ("Indebtedness to be Paid") of the Disclosure Schedule;
-------------
(c) Indebtedness existing as of the Effective Date which is
identified in Item 7.2.2(c) ("Ongoing Indebtedness") of the Disclosure
-------------
Schedule and Indebtedness extending, renewing, replacing or refinancing
such Indebtedness on terms (when incurred and as amended from time to time)
not materially less favorable to the Person incurring such Indebtedness
than the terms of such Indebtedness being refinanced and in any event not
resulting in an increase in the principal amount outstanding thereunder;
(d) unsecured Indebtedness incurred in the ordinary course of
business (including open accounts extended by suppliers on normal trade
terms in connection with purchases of goods and services, but excluding
Indebtedness incurred through the borrowing of money or Contingent
Liabilities);
(e) the Existing Subordinated Debt;
(f) Subordinated Debt of the Borrower on terms acceptable to the
Administrative Agent;
(g) senior unsecured Indebtedness of the Borrower and its
Subsidiaries (inclusive of unsecured Indebtedness
63
described in clause (c) above) in an aggregate amount not to exceed
$5,000,000;
(h) senior secured Indebtedness of the Borrower and its Subsidiaries
(inclusive of Indebtedness in respect of Capitalized Lease Liabilities) in
an aggregate amount not to exceed $2,500,000;
(i) Indebtedness assumed by the Borrower or one of its Subsidiaries
pursuant to an acquisition otherwise permitted under Section 7.2.7 and
-------------
Indebtedness of a Person that becomes a Subsidiary of the Borrower pursuant
to an acquisition otherwise permitted pursuant to Section 7.2.7 so long as
-------------
such Indebtedness was not created in anticipation of such acquisition and
Indebtedness extending, renewing, replacing or refinancing such
Indebtedness on terms (when incurred and as amended from time to time) not
materially less favorable to the Person incurring such Indebtedness than
the terms of such Indebtedness being refinanced and in any event not
resulting in an increase in the principal amount outstanding thereunder;
(j) judgments secured by Liens permitted by Section 7.2.3(f);
----------------
(k) Guarantees by the Borrower of the Indebtedness of any Guarantor
otherwise permitted hereunder and Guarantees by any Subsidiary of any
Indebtedness of the Borrower or any Guarantor otherwise permitted
hereunder;
(l) dividends and other payments by the Borrower permitted under
Section 7.2.6;
-------------
(m) Indebtedness of the Borrower to any Subsidiary, or of any
Guarantor to the Borrower or any Subsidiary;
(n) obligations under the Bermite Development Agreement to pay fees
or other cash remuneration or compensation to or for the account of
Northholme Partners for development services;
(o) Indebtedness of any foreign Subsidiary of the Borrower to the
Borrower or any Subsidiary, the aggregate of which, when combined with all
Investments in foreign Subsidiaries of the Borrower permitted pursuant to
Section 7.2.5(f) does not exceed $1,000,000;
----------------
(p) Hedging Obligations entered into by the Borrower with any Lender
or any Affiliate of any Lender to hedge the Borrower's exposure with
respect to interest rate fluctuations, which Hedging Obligations may, at a
Lender's
64
discretion, be ratably secured by the Collateral; provided, in no
--------
event shall the notional principal amount of such Hedging Obligations
exceed $50,000,000 in the aggregate;
(q) Indebtedness evidenced by those letters of credit outstanding on
the Effective Date and identified in Item 7.2.2(q) ("Letters of Credit") of
-------------
the Disclosure Schedule; provided, however, that no Indebtedness otherwise
-------- -------
permitted by clauses (f), (g),(h), (i), (k) or (o) shall be permitted to be
----------- --- --- --- --- ---
incurred if, after giving effect to the incurrence thereof, any Event of Default
shall have occurred and be continuing.
SECTION 7.2.3. Liens. The Borrower will not, and will not permit any
-----
of its Subsidiaries to, create, incur, assume or suffer to exist any Lien upon
any of its property, revenues or assets, whether now owned or hereafter
acquired, except:
(a) Liens securing payment of the Obligations, granted pursuant to
any Loan Document;
(b) Liens securing payment of Indebtedness of the type permitted and
described in clauses (c),(h) and (i) of Section 7.2.2;
----------------------- -------------
(c) Liens for taxes, assessments or other governmental charges or
levies not at the time delinquent or thereafter payable without penalty or
being diligently contested in good faith by appropriate proceedings and for
which adequate reserves in accordance with GAAP shall have been set aside
on its books;
(d) Liens of carriers, warehousemen, mechanics, materialmen and
landlords incurred in the ordinary course of business for sums not overdue
or being diligently contested in good faith by appropriate proceedings and
for which adequate reserves in accordance with GAAP shall have been set
aside on its books;
(e) Liens incurred in the ordinary course of business in connection
with workmen's compensation, unemployment insurance or other forms of
governmental insurance or benefits, or to secure performance of tenders,
statutory obligations, leases and contracts and other similar obligations
(other than for borrowed money) entered into in the ordinary course of
business or to secure obligations on surety or appeal bonds;
(f) judgment Liens in existence less than 30 days after the entry
thereof or with respect to which execution has been stayed or the payment
of which is covered in full
65
(subject to a customary deductible) by insurance maintained with
responsible insurance companies;
(g) easements, rights of way, restrictions and other similar
encumbrances incurred in the ordinary course of business;
(h) Liens described in, and securing indebtedness permitted by,
Section 7.2.2(p), which Liens may be secured ratably with the Obligations;
----------------
(i) payments to Northholme Partners under the Bermite Development
Agreement;
(j) Liens in favor of the City of Santa Clarita (not securing
Indebtedness) created pursuant to the Bermite/Santa Clarita Agreement; and
(k) Liens on cash collateral securing the letters of credit described
in Section 7.2.2(q).
----------------
SECTION 7.2.4. Financial Condition. The Borrower will not permit:
-------------------
(a) EBITDA for any Fiscal Quarter ending on a date set forth
below, to be less than the amount set forth below opposite such date:
Minimum
Date EBITDA
---- ------
July 31, 1998 $22,500,000
October 31, 1998 and each Fiscal Quarter end
thereafter $25,000,000
(b) the Leverage Ratio ending on a date set forth below, to be
greater than the ratio set forth below opposite such date:
Date Ratio
---- -----
July 31, 1998 - October 31, 1998 3.50 to 1.00
January 31, 1999 - April 30, 1999 3.25 to 1.00
July 31, 1999 and each Fiscal Quarter end thereafter 3.00 to 1.00;
provided, however, that if the Borrower shall have not sold Whittaker Porta
-------- -------
Bella or Whittaker Porta Bella shall not have disposed of its real property
interests in Santa Clarita, California (i) by July 31, 1998, the applicable
Leverage Ratio
66
for the period ending on such date shall be 3.75 to 1.00 and (ii) by October 31,
1998, the applicable Leverage Ratio for the period ending on such date shall be
3.75 to 1.00; or
(c) the Fixed Charge Coverage Ratio at the end of any Fiscal
Quarter set forth below, to be less than the ratio set forth below opposite
such date:
Date Ratio
---- -----
July 31, 1998 - October 31, 1998 1.35 to 1.00
January 31, 1999 - April 30, 1999 1.50 to 1.00
July 31, 1999 - July 31, 2001 1.75 to 1.00
October 31, 2001 - January 31, 2002 1.35 to 1.00
April 30, 2002 and each Fiscal Quarter end thereafter 1.20 to 1.00
SECTION 7.2.5. Investments. The Borrower will not, and will not permit
-----------
any of its Subsidiaries to, make, incur, assume or suffer to exist any
Investment in any other Person, except:
(a) Investments existing on the Effective Date and identified in
Item 7.2.5(a) ("Ongoing Investments") of the Disclosure Schedule;
-------------
(b) Cash Equivalent Investments;
(c) without duplication, Investments permitted as Capital
Expenditures pursuant to Section 7.2.7;
-------------
(d) in the ordinary course of business, Investments by the
Borrower in any Guarantor, or by any Subsidiary in the Borrower or any
other Guarantor; and
(e) Investments to the extent constituting Indebtedness
permitted by Section 7.2.2;
-------------
(f) Investments by the Borrower or any Guarantor after the
Effective Date in any foreign Subsidiary of the Borrower, which when
combined with all Indebtedness of foreign Subsidiaries to the Borrower and
the Guarantors permitted by Section 7.2.2(o) does not exceed $1,000,000;
----------------
(g) non-cash proceeds received by the Borrower or any Subsidiary
in connection with any asset sale and pledged to the Administrative Agent
pursuant to the terms hereof;
67
(h) Investments received by the Borrower or any Subsidiary in
connection with the settlement of any litigation so long as such
Investments are pledged to the Administrative Agent pursuant to the terms
hereof;
(i) Investments consisting of indemnities in favor of the City
of Santa Clarita under the Bermite/Santa Clarita Agreement; and
(j) Investments from the Effective Date through the Stated
Maturity Date for Term Loans in Persons other than Guarantors or the
Borrower in an aggregate amount not to exceed $5,000,000; provided, however
--------
that cash dividends or distributions actually received by the Borrower or
any Guarantor in respect of such Investments shall be deemed to reduce the
amount of outstanding Investments (but in no event to an amount less than
zero);
provided, however, that
-------- -------
(k) no Investment otherwise permitted by clause (c) (to the
----------
extent that such Investment constitutes an Expansion Capital Expenditure)
or (f) shall be permitted to be made if, immediately before or after giving
---
effect thereto, any Event of Default shall have occurred and be continuing.
SECTION 7.2.6. Restricted Payments, etc. On and at all times after the
------------------------
Effective Date:
(a) The Borrower will not declare, pay or make any dividend or
distribution (in cash, property or obligations) on any shares of any class
of capital stock (now or hereafter outstanding) of the Borrower or on any
warrants, options or other rights with respect to any shares of any class
of capital stock (now or hereafter outstanding) of the Borrower (other than
dividends, distributions or grants of options to employees that are in each
case payable in its common stock or options or warrants to purchase its
common stock or splitups or reclassifications of its stock into additional
or other shares of its common stock); provided that the Borrower may
declare and pay dividends on its Series D Participating Convertible
Preferred Stock in an aggregate amount after the Effective Date not to
exceed $50,000. The Borrower will not apply, or permit any of its
Subsidiaries to apply, any of its funds, property or assets to the
purchase, redemption, sinking fund or other retirement of, or agree or
permit any of its Subsidiaries to purchase or redeem, any shares of any
class of capital stock (now or hereafter outstanding) of the Borrower, or
warrants, options or other rights with respect to any shares of any
68
class of capital stock (now or hereafter outstanding) of the Borrower;
provided, however that so long as no Event of Default shall have occurred
--------
and be continuing or would result therefrom, the Borrower may in the
ordinary course of business redeem or repurchase (i) its capital stock from
its employees pursuant to the exercise by such employees of stock options
(so long as no net cash payments are required by the Borrower in connection
therewith other than the deposit by the Borrower with appropriate taxing
authorities of withholding tax payments due in connection therewith) or
(ii) other shares in an amount not to exceed $200,000 per annum;
(b) the Borrower will not, and will not permit any of its
Subsidiaries to
(i) make any payment or prepayment of principal of any
Subordinated Debt, or make any payment or prepayment of interest on
any Subordinated Debt on any day other than the stated, scheduled date
for such interest payment set forth in the documents and instruments
memorializing such Subordinated Debt or which would violate the
subordination provisions of such Subordinated Debt; or
(ii) redeem, purchase or defease, any Subordinated Debt;
(c) the Borrower's Subsidiaries (other than its foreign
Subsidiaries) will not declare, pay or make any dividend or distribution
(in cash, property or obligations) on any shares of any class of capital
stock (now or hereafter outstanding) unless such dividends are paid to all
shareholders of such Subsidiary on a ratable basis except that Aviant
Information, Inc. may issue options on its stock pursuant to its employee
stock option plan; and
(d) the Borrower will not, and will not permit any Subsidiary
to, make any deposit for any of the foregoing purposes.
SECTION 7.2.7. Capital Expenditures. Except as otherwise approved by
--------------------
the Majority Lenders, the Borrower will not, and will not permit any of its
Subsidiaries to, make or commit to make any Capital Expenditure other than:
(a) except as otherwise provided in clause (b) below, for each
----------
Fiscal Year commencing November 1, 1997, Expansion Capital Expenditures in
an aggregate amount not to exceed $10,000,000;
69
(b) if the Borrower's Leverage Ratio as of the end of any Fiscal
Quarter of the Borrower ending on or after April 30, 1999 shall be less
than 2.50 to 1.00, Expansion Capital Expenditures for the Fiscal Year in
which such Fiscal Quarter falls and in each following Fiscal Year in an
aggregate amount not to exceed $20,000,000; and
(c) Maintenance Capital Expenditures (i) from May 1, 1998 through
October 31, 1998 in an amount not to exceed $3,000,000 and (ii) in any
Fiscal Year of the Borrower thereafter, in an amount not to exceed
$6,000,000.
SECTION 7.2.8. Rental Obligations. The Borrower will not, and will not
------------------
permit any of its Subsidiaries to, enter into at any time any arrangement which
does not create a Capitalized Lease Liability and which involves the leasing by
the Borrower or any of its Subsidiaries from any lessor of any real or personal
property (or any interest therein), except arrangements which, together with all
other such arrangements which shall then be in effect, will not cause the
aggregate rental expense of the Borrower and its Subsidiaries to exceed
$5,000,000 (excluding escalations resulting from a rise in the consumer price or
similar index) for any Fiscal Year of the Borrower.
SECTION 7.2.9. Consolidation, Merger, etc. Except for mergers or
--------------------------
acquisitions permitted under Section 7.2.7 or for transactions permitted under
-------------
Section 7.2.10, the Borrower will not, and will not permit any of its
--------------
Subsidiaries to, liquidate or dissolve, consolidate with, or merge into or with,
any other corporation, or purchase or otherwise acquire all or substantially all
of the assets of any Person (or of any division thereof) except
(a) any such Subsidiary may liquidate or dissolve voluntarily
into, and may merge with and into, the Borrower or any other Subsidiary,
the Borrower may merge with and into any Subsidiary so long as the Borrower
is the survivor thereof and the assets or stock of any Subsidiary may be
purchased or otherwise acquired by the Borrower or any other Subsidiary;
and
(b) so long as no Default has occurred and is continuing or
would occur after giving effect thereto, the Borrower or any of its
Subsidiaries may purchase all or substantially all of the stock or assets
of any Person, or acquire such Person by merger, if permitted (without
duplication) by Section 7.2.7 to be made as a Capital Expenditure.
-------------
SECTION 7.2.10. Asset Dispositions, etc. The Borrower will not, and
-----------------------
will not permit any of its Subsidiaries to, sell or dispose of any of its assets
to any Person, except for (i) sales, transfers, leases, contributions or
conveyances in the ordinary
70
course of its business, (ii) the sale by Whittaker Porta Bella of its real
property interests in Santa Clarita, California, (iii) the sale by the Borrower
of the stock of Whittaker Porta Bella, (iv) the sale by Aviant Information, Inc.
of its assets and businesses, (v) the sale by the Borrower of the stock of
Aviant Information, Inc., (vi) the sale of the warrants in MRV Communications,
Inc. and (vii) other sales of assets (excluding receivables)so long as the
aggregate sales proceeds from sales under clause (vii) do not in the aggregate
exceed $5,000,000 in any Fiscal Year or $10,000,000 from the Effective Date
through the stated Maturity Date for Term Loans.
SECTION 7.2.11. Modification of Certain Agreements. The Borrower will
----------------------------------
not consent to any amendment, supplement or other modification of any of the
terms or provisions contained in, or applicable to, (i) the Existing
Subordinated Debt, other than any amendment, supplement or other modification
which extends the maturity date, reduces the interest rate thereof or reduces
the amount of any required repayment or redemption or otherwise could not
reasonably be expected to impair the interests of the Lenders and (ii) so long
as Whittaker Porta Bella shall own all or any portion of the Bermite Land and
the Borrower shall own Whittaker Porta Bella, the Bermite Development Agreement
or the Bermite/Santa Clarita Agreement, insofar as such agreements relate to the
Bermite Land owned by Whittaker Porta Bella, other than any amendment,
supplement or other modification which could not reasonably be expected to
impair the interests of the Lenders.
SECTION 7.2.12. Transactions with Affiliates. The Borrower will not,
----------------------------
and will not permit any of its Subsidiaries to, enter into, or cause, suffer or
permit to exist any arrangement or contract with any of its other Affiliates
unless such arrangement or contract is fair and equitable to the Borrower or
such Subsidiary; provided, however, that nothing contained in this Section
-------- ------- -------
7.2.12 shall prohibit:
------
(i) any transaction expressly permitted by Section 7.2.2(k),
----------------
(m) or (o), 7.2.5 or 7.2.6 or
--- --- ----- -----
(ii) customary directors' and officers' indemnities;
(iii) customary directors' fees;
(iv) reasonable compensation to officers consistent with past
practice; and
71
(v) administrative services provided by the Borrower to its
Subsidiaries in the ordinary course of business consistent with past
practice.
SECTION 7.2.13. Negative Pledges, Restrictive Agreements, etc. The
---------------------------------------------
Borrower will not, and will not permit any of its Subsidiaries to, enter into
any agreement (excluding this Agreement and any other Loan Document) prohibiting
(a) the creation or assumption of any Lien upon its properties,
revenues or assets, whether now owned or hereafter acquired, or the ability
of the Borrower or any Subsidiary to amend or otherwise modify this
Agreement or any other Loan Document; or
(b) the ability of any Subsidiary of the Borrower to make any
payments, directly or indirectly, to the Borrower by way of dividends,
advances, repayments of loans or advances, reimbursements of management and
other intercompany charges, expenses and accruals or other returns on
investments, or any other agreement or arrangement which restricts the
ability of any such Subsidiary to make any payment, directly or indirectly,
to the Borrower.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1. Listing of Events of Default. Each of the following
----------------------------
events or occurrences described in this Section 8.1 shall constitute an "Event
----------- -----
of Default".
----------
SECTION 8.1.1. Non-Payment of Obligations. The Borrower shall default
--------------------------
in the payment or mandatory prepayment when due of any principal of any Loan
(or, if such failure to pay is due solely to a failure of the wire transfer
payments system and is not attributable to a failure of the Borrower to timely
initiate (or attempt to initiate) payment, within one Business Day of the due
date thereof), the Borrower shall default in the payment when due of any
interest on any Loan (and such default shall continue unremedied for a period of
three days), or the Borrower shall default (and such default shall continue
unremedied for a period of five days) in the payment when due of any Commitment
Fee or of any other monetary Obligation.
SECTION 8.1.2. Breach of Warranty. Any representation or warranty of
------------------
the Borrower or any other Obligor made or deemed to be made hereunder or in any
other Loan Document or any other writing or certificate furnished by or on
behalf of the Borrower
72
or any other Obligor to the Administrative Agent or any Lender for the purposes
of or in connection with this Agreement or any such other Loan Document
(including any certificates delivered pursuant to Article V) is or shall be
---------
incorrect when made in any material respect.
SECTION 8.1.3. Non-Performance of Certain Covenants and Obligations.
----------------------------------------------------
The Borrower shall default in the due performance and observance of any of its
obligations under Section 7.2.
-----------
SECTION 8.1.4. Non-Performance of Other Covenants and Obligations.
--------------------------------------------------
The Borrower shall default in the due performance and observance of any other
agreement contained herein or in any other Loan Document, and such default shall
continue unremedied for a period of 30 days after notice thereof shall have been
given to the Borrower by the Administrative Agent or any Lender.
SECTION 8.1.5. Default on Other Indebtedness. A default shall occur
-----------------------------
in the payment when due (subject to any applicable grace period), whether by
acceleration or otherwise, of any Indebtedness (other than Indebtedness
described in Section 8.1.1) of the Borrower or any of its Subsidiaries having a
-------------
principal amount, individually or in the aggregate, in excess of $5,000,000, or
a default shall occur in the performance or observance of any obligation or
condition with respect to such Indebtedness if the effect of such default is to
immediately accelerate the maturity of any such Indebtedness or such default
shall continue unremedied for any applicable period of time sufficient to permit
the holder or holders of such Indebtedness, or any trustee or agent for such
holders, to cause such Indebtedness to immediately become due and payable prior
to its expressed maturity.
SECTION 8.1.6. Judgments. Any judgment or order for the payment of
---------
money in excess of $5,000,000 (to the extent not paid or covered by insurance)
shall be rendered against the Borrower or any of its Subsidiaries and either
(a) enforcement proceedings shall have been commenced by any
creditor upon such judgment or order; or
(b) there shall be any period of 20 consecutive days during
which a stay of enforcement of such judgment or order, by reason of a
pending appeal or otherwise, shall not be in effect.
SECTION 8.1.7. Pension Plans. Any of the following events shall occur
-------------
with respect to any Pension Plan
(a) the institution of any steps by the Borrower, any member of
its Controlled Group or any other Person to
73
terminate a Pension Plan if, as a result of such termination, the Borrower
or any such member could be required to make a contribution to such Pension
Plan, or could reasonably expect to incur a liability or obligation to such
Pension Plan, in excess of $5,000,000; or
(b) a contribution failure occurs with respect to any Pension
Plan sufficient to give rise to a Lien under Section 302(f) of ERISA.
SECTION 8.1.8. Control of the Borrower. Any Change in Control shall
-----------------------
occur.
SECTION 8.1.9. Bankruptcy, Insolvency, etc. The Borrower or any of
---------------------------
its Significant Subsidiaries shall
(a) become insolvent or generally fail to pay, or admit in
writing its inability or unwillingness to pay, debts as they become due;
(b) apply for, consent to, or acquiesce in, the appointment of a
trustee, receiver, sequestrator or other custodian for the Borrower or any
of its Significant Subsidiaries or any property of any thereof, or make a
general assignment for the benefit of creditors;
(c) in the absence of such application, consent or acquiescence,
permit or suffer to exist the appointment of a trustee, receiver,
sequestrator or other custodian for the Borrower or any of its Significant
Subsidiaries or for a substantial part of the property of any thereof, and
such trustee, receiver, sequestrator or other custodian shall not be
discharged within 60 days, provided that the Borrower, and each Significant
Subsidiary hereby expressly authorizes the Administrative Agent and each
Lender to appear in any court conducting any relevant proceeding during
such 60-day period to preserve, protect and defend their rights under the
Loan Documents;
(d) permit or suffer to exist the commencement of any
bankruptcy, reorganization, debt arrangement or other case or proceeding
under any bankruptcy or insolvency law, or any dissolution, winding up or
liquidation proceeding, in respect of the Borrower or any of its
Significant Subsidiaries, and, if any such case or proceeding is not
commenced by the Borrower or such Significant Subsidiary, such case or
proceeding shall be consented to or acquiesced in by the Borrower or such
Significant Subsidiary or shall result in the entry of an order for relief
or shall remain for 60 days undismissed, provided that the Borrower and
each Significant Subsidiary hereby expressly authorizes the
74
Administrative Agent and each Lender to appear in any court conducting any
such case or proceeding during such 60-day period to preserve, protect and
defend their rights under the Loan Documents; or
(e) take any corporate action authorizing, or in furtherance of,
any of the foregoing.
SECTION 8.1.10. Impairment of Security, etc. Except in connection
---------------------------
with the sale of an asset or property permitted hereunder, any Loan Document, or
any Lien granted thereunder, shall (except in accordance with its terms), in
whole or in part, terminate, cease to be effective or cease to be the legally
valid, binding and enforceable obligation of any Obligor party thereto; the
Borrower, any other Obligor or any other party shall, directly or indirectly,
contest in any manner such effectiveness, validity, binding nature or
enforceability; or any Lien securing any Obligation shall, in whole or in part,
cease to be a perfected first priority Lien (subject to Liens permitted
hereunder).
SECTION 8.1.11. Liens on Shares of Subsidiaries. Any Lien securing
-------------------------------
borrowed money, other than a Lien in favor of the Administrative Agent on behalf
of the Lenders, shall be placed on any capital stock of any Subsidiary of the
Borrower.
SECTION 8.2. Action if Bankruptcy. If any Event of Default described
--------------------
in Section 8.1.9 shall occur, the Commitments (if not theretofore terminated)
-------------
shall automatically terminate and the outstanding principal amount of all
outstanding Loans and all other Obligations shall automatically be and become
immediately due and payable, without notice or demand.
SECTION 8.3. Action if Other Event of Default. If any Event of
--------------------------------
Default (other than any Event of Default described in Section 8.1.9) shall occur
-------------
for any reason, whether voluntary or involuntary, and be continuing, the
Administrative Agent, upon the direction of the Required Lenders, shall by
notice to the Borrower declare all or any portion of the outstanding principal
amount of the Loans and other Obligations to be due and payable and/or the
Commitments (if not theretofore terminated) to be terminated, whereupon the full
unpaid amount of such Loans and other Obligations which shall be so declared due
and payable shall be and become immediately due and payable and/or except as
otherwise provided in the immediately following sentence, the Commitments
(including, without limitation, the commitment of the L/C Issuer to issue any
additional Letters of Credit) shall be terminated, without further notice,
demand or presentment. Notwithstanding any termination of the Revolving Loan
Commitment prior to the Stated Maturity Date, Revolving Loans may thereafter be
made pursuant to Section 3.5 to reimburse the L/C Issuer for
-----------
75
any drafts paid on or before the Stated Maturity Date under any Letter of Credit
outstanding on the date of such termination.
ARTICLE IX
THE ADMINISTRATIVE AGENT
SECTION 9.1. Actions. Each Lender and the L/C Issuer hereby appoints
-------
the Administrative Agent as its agent under and for purposes of this Agreement,
the Notes and each other Loan Document. Each Lender authorizes the
Administrative Agent to act on behalf of such Lender under this Agreement, the
Notes and each other Loan Document and, in the absence of other written
instructions from the Required Lenders received from time to time by the
Administrative Agent (with respect to which the Administrative Agent agrees that
it will comply, except as otherwise provided in this Section or as otherwise
advised by counsel), to exercise such powers hereunder and thereunder as are
specifically delegated to or required of the Administrative Agent by the terms
hereof and thereof, together with such powers as may be reasonably incidental
thereto. Each Lender hereby indemnifies (which indemnity shall survive any
termination of this Agreement) the Administrative Agent, pro rata according to
--- ----
such Lender's Aggregate Percentage, from and against any and all liabilities,
obligations, losses, damages, claims, costs or expenses of any kind or nature
whatsoever which may at any time be imposed on, incurred by, or asserted
against, the Administrative Agent in any way relating to or arising out of this
Agreement, the Notes and any other Loan Document, including reasonable
attorneys' fees, and as to which the Administrative Agent is not reimbursed by
the Borrower; provided, however, that no Lender shall be liable for the payment
-------- -------
of any portion of such liabilities, obligations, losses, damages, claims, costs
or expenses which are determined by a court of competent jurisdiction in a final
proceeding to have resulted from the Administrative Agent's gross negligence or
wilful misconduct. The Administrative Agent shall not be required to take any
action hereunder, under the Notes or under any other Loan Document, or to
prosecute or defend any suit in respect of this Agreement, the Notes or any
other Loan Document, unless it is indemnified hereunder to its satisfaction. If
any indemnity in favor of the Administrative Agent shall be or become, in the
Administrative Agent's determination, inadequate, the Administrative Agent may
call for additional indemnification from the Lenders and cease to do the acts
indemnified against hereunder until such additional indemnity is given.
SECTION 9.2. Funding Reliance, etc. Unless the Administrative Agent
---------------------
shall have been notified by telephone, confirmed in writing, by any Lender by
5:00 p.m., New York time, on the day prior to a Borrowing that such Lender will
not make available the amount which would constitute its applicable
76
Percentage of such Borrowing on the date specified therefor, the Administrative
Agent may assume that such Lender has made such amount available to the
Administrative Agent and, in reliance upon such assumption, make available to
the Borrower a corresponding amount. If and to the extent that such Lender shall
not have made such amount available to the Administrative Agent, such Lender and
the Borrower severally agree to repay the Administrative Agent forthwith on
demand such corresponding amount together with interest thereon, for each day
from the date the Administrative Agent made such amount available to the
Borrower to the date such amount is repaid to the Administrative Agent, at the
interest rate applicable at the time to Loans comprising such Borrowing.
SECTION 9.3. Exculpation. Neither the Administrative Agent nor any of
-----------
its directors, officers, employees or agents shall be liable to any Lender for
any action taken or omitted to be taken by it under this Agreement or any other
Loan Document, or in connection herewith or therewith, except for its own wilful
misconduct or gross negligence, nor responsible for any recitals or warranties
herein or therein, nor for the effectiveness, enforceability, validity or due
execution of this Agreement or any other Loan Document, nor for the creation,
perfection or priority of any Liens purported to be created by any of the Loan
Documents, or the validity, genuineness, enforceability, existence, value or
sufficiency of any collateral security, nor to make any inquiry respecting the
performance by the Borrower of its obligations hereunder or under any other Loan
Document. Any such inquiry which may be made by the Administrative Agent shall
not obligate it to make any further inquiry or to take any action. The
Administrative Agent shall be entitled to rely upon advice of counsel concerning
legal matters and upon any notice, consent, certificate, statement or writing
which the Administrative Agent believes to be genuine and to have been presented
by a proper Person.
SECTION 9.4. Successor. The Administrative Agent may resign as such at
---------
any time upon at least 30 days' prior notice to the Borrower and all Lenders.
If the Administrative Agent at any time shall resign, the Required Lenders may,
with the consent of the Borrower (so long as no Event of Default shall have
occurred and be continuing), such consent not to be unreasonably withheld,
appoint another Lender as a successor Administrative Agent which shall thereupon
become the Administrative Agent hereunder. If no successor Administrative Agent
shall have been so appointed by the Required Lenders, and shall have accepted
such appointment, within 30 days after the retiring Administrative Agent's
giving notice of resignation, then the retiring Administrative Agent may, on
behalf of the Lenders, appoint a successor Administrative Agent, which shall be
one of the Lenders or a commercial banking institution organized under the laws
of the U.S. (or any State
77
thereof) or a U.S. branch or agency of a commercial banking institution, and
having a combined capital and surplus of at least $500,000,000. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall be entitled to
receive from the retiring Administrative Agent such documents of transfer and
assignment as such successor Administrative Agent may reasonably request, and
shall thereupon succeed to and become vested with all rights, powers, privileges
and duties of the retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations under this Agreement.
After any retiring Administrative Agent's resignation hereunder as the
Administrative Agent, the provisions of
(a) this Article IX shall inure to its benefit as to any actions
----------
taken or omitted to be taken by it while it was the Administrative Agent
under this Agreement; and
(b) Section 10.3 and Section 10.4 shall continue to inure to its
------------ ------------
benefit.
SECTION 9.5. Credit Decisions. Each Lender acknowledges that it has,
----------------
independently of the Administrative Agent and each other Lender, and based on
such Lender's review of the financial information of the Borrower, this
Agreement, the other Loan Documents (the terms and provisions of which being
satisfactory to such Lender) and such other documents, information and
investigations as such Lender has deemed appropriate, made its own credit
decision to extend its Commitments. Each Lender also acknowledges that it will,
independently of the Administrative Agent and each other Lender, and based on
such other documents, information and investigations as it shall deem
appropriate at any time, continue to make its own credit decisions as to
exercising or not exercising from time to time any rights and privileges
available to it under this Agreement or any other Loan Document.
SECTION 9.6. Copies, etc. The Administrative Agent shall give prompt
-----------
notice to each Lender of each notice or request required or permitted to be
given to the Administrative Agent by the Borrower pursuant to the terms of this
Agreement (unless concurrently delivered to the Lenders by the Borrower). The
Administrative Agent will distribute to each Lender each document or instrument
received for its account and copies of all other communications received by the
Administrative Agent from the Borrower for distribution to the Lenders by the
Administrative Agent in accordance with the terms of this Agreement.
ARTICLE X
78
MISCELLANEOUS PROVISIONS
SECTION 10.1. Waivers, Amendments, etc. The provisions of this Agreement
------------------------
and of each other Loan Document may from time to time be amended, modified or
waived, if such amendment, modification or waiver is in writing and consented to
by the Borrower and the Required Lenders (except where the applicable provision
of this Agreement or such other Loan Document specifies that a determination is
to be governed by all Lenders or the Majority Lenders); provided, however, that
-------- -------
only the consent of the Administrative Agent shall be required to release the
Guaranty of Aviant Information, Inc. or Whittaker Porta Bella and the Collateral
provided by Aviant Information, Inc. or Whittaker Porta Bella and provided,
--------
further, that no such amendment, modification or waiver which would:
-------
(a) modify any requirement hereunder that any particular action
be taken by all the Lenders or by the Required Lenders shall be effective
unless consented to by each Lender;
(b) modify this Section 10.1, change the definitions of
------------
"Majority Lenders" or "Required Lenders", increase any Commitment Amount
----------------- ----------------
(except as otherwise provided in Section 2.8) or any Percentage of any
-----------
Lender (except as otherwise provided pursuant to Section 2.8), reduce any
-----------
fees described in Article III, release a material portion of the Collateral
-----------
(except as otherwise specifically provided in any Loan Document), or extend
any Commitment Termination Date shall be made without the consent of each
Lender;
(c) extend the due date for, or reduce the amount of, or grant a
waiver of, any scheduled repayment or prepayment of principal of or
interest on any Loan (or reduce the principal amount of or rate of interest
on any Loan) shall be made without the consent of the Lender making such
Loan;
(d) affect adversely the interests, rights or obligations of the
Administrative Agent qua the Administrative Agent shall be made without
---
consent of the Administrative Agent;
(e) release any Guarantor, except in connection with any sale of,
or merger by, such Guarantor otherwise permitted under the terms of this
Agreement without the consent of all Lenders;
(f) modify Section 3.1.2 shall be made without the consent of the
-------------
Swingline Lender; or
79
(g) modify Sections 2.7, 3.4 or 3.5 shall be made without the
------------ --- ---
consent of the L/C Issuer.
No failure or delay on the part of the Administrative Agent or any Lender in
exercising any power or right under this Agreement or any other Loan Document
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such power or right preclude any other or further exercise thereof or the
exercise of any other power or right. No notice to or demand on the Borrower in
any case shall entitle it to any notice or demand in similar or other
circumstances. No waiver or approval by the Administrative Agent or any Lender
under this Agreement or any other Loan Document shall, except as may be
otherwise stated in such waiver or approval, be applicable to subsequent
transactions. No waiver or approval hereunder shall require any similar or
dissimilar waiver or approval thereafter to be granted hereunder.
SECTION 10.2. Notices. All notices and other communications provided to
-------
any party hereto under this Agreement or any other Loan Document shall be in
writing or by facsimile and addressed, delivered or transmitted to such party at
its address or facsimile number set forth below its signature hereto or at such
other address or facsimile number as may be designated by such party in a notice
to the other parties. Any notice, if mailed and properly addressed with postage
prepaid or if properly addressed and sent by pre-paid courier service, shall be
deemed given when received; any notice, if transmitted by facsimile, shall be
deemed given when transmitted.
SECTION 10.3. Payment of Costs and Expenses. The Borrower agrees to pay
-----------------------------
on demand all reasonable expenses of the Administrative Agent (including the
reasonable fees and out-of-pocket expenses of counsel to the Administrative
Agent and of local counsel, if any, who may be retained by counsel to the
Administrative Agent) in connection with
(a) the negotiation, preparation, execution and delivery of this
Agreement and of each other Loan Document, including schedules and
exhibits, and any amendments, waivers, consents, supplements or other
modifications to this Agreement or any other Loan Document as may from time
to time hereafter be required, whether or not the transactions contemplated
hereby are consummated,
(b) the filing, recording, refiling or rerecording of the
Collateral Documents and/or any Uniform Commercial Code financing
statements relating thereto and all amendments, supplements and
modifications to any thereof and any and all other documents or instruments
of further assurance required to be filed or recorded or refiled or
80
rerecorded by the terms hereof or of the Collateral Documents and
(c) the preparation and review of the form of any document or
instrument relevant to this Agreement or any other Loan Document.
The Borrower further agrees to pay, and to save the Administrative Agent and the
Lenders harmless from all liability for, any stamp or other similar taxes which
may be payable in connection with the execution or delivery of this Agreement,
the Borrowings hereunder, or the issuance of the Notes or any other Loan
Documents. The Borrower also agrees to reimburse the Administrative Agent and
each Lender upon demand for all reasonable out-of-pocket expenses (including
reasonable attorneys' fees and legal expenses) incurred by the Administrative
Agent or such Lender in connection with (x) the negotiation of any restructuring
or "work-out", whether or not consummated, of any Obligations and (y) the
enforcement of any Obligations.
SECTION 10.4. Indemnification. In consideration of the execution and
---------------
delivery of this Agreement by each Lender and the extension of the Commitments,
the Borrower hereby indemnifies, exonerates and holds the Administrative Agent
and each Lender and each of their respective officers, directors, employees and
agents (collectively, the "Indemnified Parties") free and harmless from and
-------------------
against any and all actions, causes of action, suits, losses, costs, liabilities
and damages, and expenses incurred in connection therewith (irrespective of
whether any such Indemnified Party is a party to the action for which
indemnification hereunder is sought), including reasonable attorneys' fees and
disbursements (collectively, the "Indemnified Liabilities"), incurred by the
-----------------------
Indemnified Parties or any of them as a result of, or arising out of, or
relating to
(a) any transaction financed or to be financed in whole or in
part, directly or indirectly, with the proceeds of any Loan or Letter of
Credit;
(b) the entering into and performance of this Agreement and any
other Loan Document by any of the Indemnified Parties (including any action
brought by or on behalf of the Borrower as the result of any determination
by the Required Lenders pursuant to Article V not to fund any Borrowing);
---------
(c) any investigation, litigation or proceeding related to any
acquisition or proposed acquisition by the Borrower or any of its
Subsidiaries of all or any portion of
81
the stock or assets of any Person, whether or not the Administrative Agent
or such Lender is party thereto;
(d) any investigation, litigation or proceeding of or against
the Borrower or any of its Subsidiaries related to any environmental
cleanup, audit or compliance with Environmental Laws by the Borrower and
its Subsidiaries or the Release by the Borrower or any of its Subsidiaries
of any Hazardous Material; or
(e) the presence on or under, or the escape, seepage, leakage,
spillage, discharge, emission, discharging or releases from, any real
property owned or operated by the Borrower or any Subsidiary thereof of any
Hazardous Material (including any losses, liabilities, damages, injuries,
costs, expenses or claims asserted or arising under any Environmental Law),
regardless of whether caused by, or within the control of, the Borrower or
such Subsidiary,
except for any such Indemnified Liabilities (i) arising for the account of a
particular Indemnified Party by reason of the relevant Indemnified Party's gross
negligence or wilful misconduct or (ii) asserted by the Arranger against the
Administrative Agent (or vice versa) or by an individual Indemnified Party
----------
against another Indemnified Party in connection with a termination or other
employment dispute. If and to the extent that the foregoing undertaking may be
unenforceable for any reason, the Borrower hereby agrees to make the maximum
contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law.
SECTION 10.5. Survival. The obligations of the Borrower under Sections
-------- --------
4.3, 4.4, 4.5, 4.6, 10.3 and 10.4, and the obligations of the Lenders under
--- --- --- --- ---- ----
Section 9.1, shall in each case survive any termination of this Agreement, the
-----------
payment in full of all monetary Obligations and the termination of all
Commitments. The representations and warranties made by each Obligor in each
other Loan Document shall survive the execution and delivery of this Agreement
and each such other Loan Document.
SECTION 10.6. Severability. Any provision of this Agreement or any other
------------
Loan Document which is prohibited or unenforceable in any jurisdiction shall, as
to such provision and such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions of
this Agreement or such Loan Document or affecting the validity or enforceability
of such provision in any other jurisdiction.
82
SECTION 10.7. Headings. The various headings of this Agreement and of
--------
each other Loan Document are inserted for convenience only and shall not affect
the meaning or interpretation of this Agreement or such other Loan Document or
any provisions hereof or thereof.
SECTION 10.8. Execution in Counterparts, Effectiveness, etc. This
----------------------------------------------
Agreement may be executed by the parties hereto in several counterparts, each of
which shall be deemed to be an original and all of which shall constitute
together but one and the same agreement. This Agreement shall become effective
when counterparts hereof executed on behalf of the Borrower and each Lender (or
notice thereof satisfactory to the Administrative Agent) shall have been
received by the Administrative Agent and notice thereof shall have been given by
the Administrative Agent to the Borrower and each Lender.
SECTION 10.9. Governing Law; Entire Agreement. THIS AGREEMENT, THE NOTES
-------------------------------
AND EACH OTHER LOAN DOCUMENT SHALL EACH BE DEEMED TO BE A CONTRACT MADE UNDER
AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK. This Agreement, the
Notes, the Fee Letter and the other Loan Documents constitute the entire
understanding among the parties hereto with respect to the subject matter hereof
and supersede any prior agreements, written or oral, with respect thereto.
SECTION 10.10. Successors and Assigns. This Agreement shall be binding
----------------------
upon and shall inure to the benefit of the parties hereto and their respective
successors and assigns; provided, however, that:
-------- -------
(a) the Borrower may not assign or transfer its rights or
obligations hereunder without the prior written consent of all
Lenders; and
(b) the rights of sale, assignment and transfer of the Lenders
are subject to Section 10.11.
-------------
SECTION 10.11. Sale and Transfer of Loans and Notes; Participations in
-------------------------------------------------------
Loans and Notes. Each Lender may assign, or sell participations in, its Loans,
---------------
Revolving Loan Commitment and Term Loan Commitment to one or more other Persons
in accordance with this Section 10.11.
-------------
SECTION 10.11.1. Assignments. Any Lender,
-----------
(a) with the written consent of the Administrative Agent and, so long
as no Event of Default shall be continuing, the Borrower (which consent
shall not be unreasonably delayed or withheld) may at any time assign and
delegate to an Eligible Assignee, and
83
(b) with notice to the Borrower and the Administrative Agent, and with
the consent of the Administrative Agent (which consent shall not be
unreasonably delayed or withheld) but without the consent of the Borrower,
may assign and delegate to any of its Affiliates and with notice to the
Borrower and the Administrative Agent, may assign and delegate to any other
existing Lender (each Person described in either of the foregoing clauses
as being the Person to whom such assignment and delegation is to be made,
being hereinafter referred to as an "Assignee Lender"), all or any fraction
---------------
of such Lender's Term Loan and/or Revolving Loans (and, in the case of
Revolving Loans, such fraction of any outstanding Letters of Credit) and
the corresponding Commitments therefor (which assignment and delegation
shall be of a constant, and not a varying, percentage of all the assigning
Term Loan and/or Revolving Loans (and, in the case of Revolving Loans, such
fraction of any outstanding Letters of Credit) and the corresponding
Commitments therefor) in a minimum aggregate amount of $5,000,000 or, if
less, the entire amount of such Lender's total Commitments; provided, if
--------
the Borrower objects to such proposed assignment, the Borrower shall state
in reasonable detail the reasons why the Borrower proposes to withhold such
consent; and provided, further that any such Assignee Lender will comply
-------- -------
with the provisions contained in Section 4.6 and further provided, however,
----------- ------- -------- -------
that, the Borrower and the Administrative Agent shall be entitled to
continue to deal solely and directly with such Lender in connection with
the interests proposed to be so assigned and delegated to an Assignee
Lender until
(i) written notice of such assignment and delegation, together
with payment instructions, addresses and related information with
respect to such Assignee Lender, shall have been given to the Borrower
and the Administrative Agent by such Lender and such Assignee Lender,
(ii) such Assignee Lender shall have executed and delivered to
the Borrower and the Administrative Agent a Lender Assignment
Agreement, accepted by the Administrative Agent and the Borrower, and
(iii) the processing fees described below shall have been paid.
From and after the date that the Administrative Agent and the Borrower accept
such Lender Assignment Agreement, (x) the Assignee Lender thereunder shall be
deemed automatically to have become a party hereto and to the extent that rights
and obligations hereunder have been assigned and delegated to such
84
Assignee Lender in connection with such Lender Assignment Agreement, shall have
the rights and obligations of a Lender hereunder and under the other Loan
Documents, and (y) the assignor Lender, to the extent that rights and
obligations hereunder have been assigned and delegated by it in connection with
such Lender Assignment Agreement, shall be released from its obligations
hereunder and under the other Loan Documents. Upon the request of the Assignee
Lender, after its receipt of an executed, acknowledged and effective Lender
Assignment Agreement, the Borrower shall execute and deliver to the
Administrative Agent (for delivery to the relevant Assignee Lender) new Notes
evidencing such Assignee Lender's assigned Loans and Commitments and, if the
assignor Lender has retained Loans and Commitments hereunder, upon request of
such assignor Lender, replacement Notes in the principal amount of the Loans and
Commitments retained by the assignor Lender hereunder (such Notes to be in
exchange for, but not in payment of, those Notes then held by such assignor
Lender). Each such Note shall be dated the date of the predecessor Notes. The
assignor Lender shall ▇▇▇▇ the predecessor Notes "exchanged" and deliver them to
the Borrower. Accrued interest on that part of the predecessor Notes evidenced
by the new Notes, and accrued fees, shall be paid as provided in the Lender
Assignment Agreement. Accrued interest on that part of the predecessor Notes
evidenced by the replacement Notes shall be paid to the assignor Lender. Accrued
interest and accrued fees shall be paid at the same time or times provided in
the predecessor Notes and in this Agreement. Such assignor Lender or such
Assignee Lender must also pay a processing fee to the Administrative Agent (for
the sole account of the Administrative Agent) upon delivery of any Lender
Assignment Agreement in the amount of $3,500 except in the case of an assignment
by a Lender to one of its Affiliates. Any Lender may at any time pledge any of
its Notes or any other instrument evidencing its rights as a Lender under this
Agreement to a Federal Reserve Bank, and any Lender that is an investment fund
that invests in bank loans may, without the consent of the Administrative Agent
or the Borrower, pledge all or any portion of its interest and rights to any
trustee or any other representative of holders of obligations owed or securities
issued by such investment fund as security for such obligations or securities;
provided, that no such pledge shall release that Lender from its obligations
--------
hereunder or grant to the Federal Reserve Bank or any trustee the rights of a
Lender hereunder absent foreclosure of such pledge.
SECTION 10.11.2. Participations. Any Lender may at any time sell to one
--------------
or more commercial banks or other Persons (each of such commercial banks and
other Persons being herein called a "Participant") participating interests in
-----------
any of the Loans, Commitments, or other interests of such Lender hereunder;
provided, however, that
-------- -------
85
(a) no participation contemplated in this Section 10.11.2 shall
---------------
relieve such Lender from its Commitments or its other obligations hereunder
or under any other Loan Document,
(b) such Lender shall remain solely responsible for the performance of
its Commitments and such other obligations,
(c) the Borrower and the Administrative Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement and each of the other Loan
Documents,
(d) no Participant, unless such Participant is an Affiliate of such
Lender, or is itself a Lender, shall be entitled to require such Lender to
take or refrain from taking any action hereunder or under any other Loan
Document, except that such Lender may agree with any Participant that such
Lender will not, without such Participant's consent, take any actions of
the type described in clause (b) or (c) of Section 10.1, and
---------- --- ------------
(e) the Borrower shall not be required to pay any amount under Section
-------
4.6 that is greater than the amount which it would have been required to
---
pay had no participating interest been sold.
SECTION 10.12. Other Transactions. Nothing contained herein shall
------------------
preclude the Administrative Agent or any other Lender from engaging in any
transaction, in addition to those contemplated by this Agreement or any other
Loan Document, with the Borrower or any of its Affiliates in which the Borrower
or such Affiliate is not restricted hereby from engaging with any other Person.
SECTION 10.13. Judgment Currency. If the Administrative Agent or any
-----------------
Lender receives an amount in respect of the Borrower's Obligations, or if that
liability is converted into a claim, proof, judgment or order, in a currency
other than the currency (the "contractual currency") in which the amount is
expressed to be payable under this Agreement, (a) the Borrower shall indemnify
the Administrative Agent or such Lender, as applicable, as an independent
obligation against any loss, costs, expense or liability arising out of or as a
result of the conversion; (b) if the amount received by the Administrative Agent
or such Lender, as applicable, when converted into the contractual currency at a
market rate on the date of receipt by the Administrative Agent or such Lender in
the usual course of its business, is less than the amount owed in the
contractual currency, the Borrower, shall within thirty days of demand pay to
86
the Agent or such Lender, as applicable, an amount in the contractual currency
equal to the deficit; and (c) the Borrower shall pay to the Administrative Agent
or such Lender, as applicable, within thirty days of demand any exchange costs
and taxes payable in connection with any such conversion. The Borrower waives
any right it may have in any jurisdiction to the extent permitted by law to pay
any amount under this Agreement in a currency other than that in which it is
expressed to be payable.
SECTION 10.14. Forum Selection and Consent to Jurisdiction. ANY LITIGATION
-------------------------------------------
BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE AGENT, THE
DOCUMENTATION AGENT, THE LENDERS, THE L/C ISSUER OR THE BORROWER MAY BE BROUGHT
AND MAINTAINED IN THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT
-------- -------
ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE
BROUGHT, AT THE ADMINISTRATIVE AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION
WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. THE BORROWER HEREBY
EXPRESSLY AND IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET
FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY
IN CONNECTION WITH SUCH LITIGATION. THE BORROWER FURTHER IRREVOCABLY CONSENTS
TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL
SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK. THE BORROWER HEREBY EXPRESSLY
AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION
WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH
LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY
SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT
THE BORROWER HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY
COURT OF FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT
PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO
ITSELF OR ITS PROPERTY, THE BORROWER HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN
RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
SECTION 10.15. Waiver of Jury Trial. EACH OF THE ADMINISTRATIVE AGENT,
--------------------
THE LENDERS, THE L/C ISSUER, THE DOCUMENTATION AGENT AND THE BORROWER HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS ANY OF THEM MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY
COURSE OF CONDUCT,
87
COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE
ADMINISTRATIVE AGENT, THE L/C ISSUER, THE DOCUMENTATION AGENT, THE LENDERS OR
THE BORROWER. THE BORROWER ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND
SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF EACH
OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A
MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT AND THE LENDERS ENTERING INTO
THIS AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.
SECTION 10.16. Confidentiality; Disclosure.
---------------------------
(a) The Administrative Agent and each of the Lenders shall hold all
non-public information obtained pursuant to the requirements of this Agreement
(which has been identified as such by the Borrower) in accordance with its
customary procedures for handling confidential information of this nature and in
accordance with safe and sound banking practices and will use such information
only in connection with the transactions contemplated by this Agreement, and in
any event may make disclosure of any such information (i) to the Administrative
Agent or any Lender, (ii) to the extent required by law (including statute,
rule, regulation or judicial process), (iii) to counsel for any Lender or the
Administrative Agent or to their respective accountants, each of whom shall also
be bound by the confidentiality obligations set forth herein, (iv) to bank
examiners and auditors and appropriate government examining authorities, (v) to
the extent necessary or appropriate in connection with any litigation to which
any Lender or the Administrative Agent is a party, or (vi) to any actual or
prospective participant in or assignee of any rights and obligations of such
Lender under this Agreement. In connection with any disclosure permitted above,
the disclosing party will inform the recipient of the confidential nature of the
information being disclosed and use its best efforts to obtain an undertaking
from the recipient to abide by the restrictions of this Section 10.16.
-------------
(b) Nothing in this Agreement shall require the Borrower to disclose
any information if such disclosure would violate any federal government
prohibitions on the disclosure of classified or confidential information.
88
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the day
and year first above written.
▇▇▇▇▇▇▇▇▇ CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Chief Financial Officer
Address: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇
89
CANADIAN IMPERIAL BANK OF COMMERCE,
as Administrative Agent and L/C Issuer
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------
Title: Managing Director, CIBC
▇▇▇▇▇▇▇▇▇▇▇ Corp. AS AGENT
Address: ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Agency Services
90
LENDERS
-------
CIBC INC., as Lender and Swingline Lender
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------
Title: Managing Director
CIBC ▇▇▇▇▇▇▇▇▇▇▇ Corp., AS
AGENT
Notice Address:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇
Domestic
Office: Two Paces West
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Ms. ▇▇▇▇▇ ▇▇▇▇▇
Eurodollar
Office: Two Paces West
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Ms. ▇▇▇▇▇ ▇▇▇▇▇
91
THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
Title: FIRST VICE PRESIDENT
Notice Address:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Domestic and Eurodollar Office:
One First National
Plaza 0634 1/0
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
92
▇▇▇ ▇▇▇▇▇▇ AMERICAN CAPITAL
PRIME RATE INCOME TRUST
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------
Title:
Notice Address:
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
Domestic and Eurodollar Office:
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
93
BANQUE PARIBAS
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------
Title: ASST. VICE PRESIDENT
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
Title: VICE PRESIDENT
Notice Address:
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇ or
(▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Domestic and Eurodollar Office:
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇ or
(▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
94
SCHEDULE I
REVOLVING TERM AGGREGATE
LENDER PERCENTAGE PERCENTAGE PERCENTAGE
------ ---------- ---------- ----------
CIBC Inc. 38.461538% 56.730770% 47.058824%
The First National Bank
of Chicago 30.769231% 15.384615% 23.529412%
▇▇▇ ▇▇▇▇▇▇ American
Capital 7.692309% 16.346155% 11.764705%
Banque Paribas 23.076922% 11.538462% 17.647059%
--------- --------- ---------
100% 100% 100%
SCHEDULE III
Subsidiaries
Place of Date Shares
Name Incorporation Incorporated Outstanding Owned
----------------------------------------------------------------------------------------------------------------
Aviant Information, Inc. California 10/29/79 38,000,000 100%
Metropolitan Financial Services Corporation Colorado 09/25/74 100 100%
Park Chemical Company Michigan 11/11/11 1,000 100%
▇▇▇▇▇▇▇▇▇ Communications, Inc. California 06/07/79 1,000 100%
▇▇▇▇▇▇▇▇▇ Controls, Inc. California 07/12/79 1,000 100%
▇▇▇▇▇▇▇▇▇ Corp. Maine 09/05/69 1,000 100%
▇▇▇▇▇▇▇▇▇ Development Co. Delaware 06/01/82 1,000 100%
▇▇▇▇▇▇▇▇▇ Ordnance, Inc. Delaware 01/04/70 1 100%
Whittaker Porta Bella Development, Inc. California 10/27/94 1,000 100%
▇▇▇▇▇▇▇▇▇ Services Corporation California 11/05/92 1,000 100%
▇▇▇▇▇▇▇▇▇ Technical Products, Inc. Colorado 10/28/91 1,000 100%
SCHEDULE IV
EXISTING LETTERS OF CREDIT
NONE
