EXHIBIT 10.34
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CREDIT AGREEMENT
DATED AS OF SEPTEMBER 27, 2001,
AMONG
FLORISTS' TRANSWORLD DELIVERY, INC.,
THE GUARANTORS FROM TIME TO TIME PARTIES HERETO,
THE LENDERS FROM TIME TO TIME PARTIES HERETO,
U.S. BANK NATIONAL ASSOCIATION,
as Syndication Agent
AND
▇▇▇▇▇▇ TRUST AND SAVINGS BANK,
as Administrative Agent
TABLE OF CONTENTS
SECTION DESCRIPTION PAGE
SECTION 1. THE CREDIT FACILITIES......................................1
Section 1.1. Revolving Credit Commitments...............................1
Section 1.2. Letters of Credit..........................................1
Section 1.3. Applicable Interest Rates..................................4
Section 1.4. Minimum Borrowing Amounts; Maximum Eurodollar Loans........6
Section 1.5. Manner of Borrowing Loans and Designating Applicable
Interest Rates........................................6
Section 1.6. Swing Loans................................................8
Section 1.7. Interest Periods..........................................10
Section 1.8. Maturity of Loans.........................................10
Section 1.9. Prepayments...............................................10
Section 1.10. Default Rate..............................................12
Section 1.11. The Notes.................................................12
Section 1.12. Funding Indemnity.........................................13
Section 1.13. Commitment Terminations...................................13
Section 1.14. Substitution of Lenders...................................16
Section 1.15. Additional Lenders........................................16
SECTION 2. FEES......................................................17
Section 2.1. Fees......................................................17
SECTION 3. PLACE AND APPLICATION OF PAYMENTS.........................18
Section 3.1. Place and Application of Payments.........................18
SECTION 4. THE COLLATERAL AND GUARANTIES.............................19
Section 4.1. Collateral................................................19
Section 4.2. Liens on Real Property....................................19
Section 4.3. Guaranties................................................20
Section 4.4. Further Assurances........................................20
SECTION 5. DEFINITIONS; INTERPRETATION...............................20
Section 5.1. Definitions...............................................20
Section 5.2. Interpretation............................................35
Section 5.3. Change in Accounting Principles...........................35
SECTION 6. REPRESENTATIONS AND WARRANTIES............................36
Section 6.1. Organization and Qualification............................36
Section 6.2. Subsidiaries..............................................36
Section 6.3. Authority and Validity of Obligations.....................36
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Section 6.4. Use of Proceeds; Margin Stock.............................37
Section 6.5. Financial Reports.........................................37
Section 6.6. No Material Adverse Change................................38
Section 6.7. Full Disclosure...........................................38
Section 6.8. Trademarks, Franchises, and Licenses......................38
Section 6.9. Governmental Authority and Licensing......................38
Section 6.10. Good Title................................................38
Section 6.11. Litigation and Other Controversies........................38
Section 6.12. Taxes.....................................................39
Section 6.13. Approvals.................................................39
Section 6.14. Affiliate Transactions....................................39
Section 6.15. Investment Company; Public Utility Holding Company........39
Section 6.16. ERISA.....................................................39
Section 6.17. Compliance with Laws......................................40
Section 6.18. Other Agreements..........................................41
Section 6.19. Solvency..................................................41
Section 6.20. No Default................................................41
SECTION 7. CONDITIONS PRECEDENT......................................41
Section 7.1. All Credit Events.........................................41
Section 7.2. Initial Credit Event......................................42
SECTION 8. COVENANTS.................................................44
Section 8.1. Maintenance of Business...................................44
Section 8.2. Maintenance of Properties.................................44
Section 8.3. Taxes and Assessments.....................................45
Section 8.4. Insurance.................................................45
Section 8.5. Financial Reports.........................................45
Section 8.6. Inspection................................................48
Section 8.7. Borrowings and Guaranties.................................48
Section 8.8. Liens.....................................................49
Section 8.9. Investments, Acquisitions, Loans and Advances.............51
Section 8.10. Mergers, Consolidations and Sales.........................52
Section 8.11. Maintenance of Subsidiaries...............................53
Section 8.12. Dividends and Certain Other Restricted Payments...........53
Section 8.13. ERISA.....................................................55
Section 8.14. Compliance with Laws......................................55
Section 8.15. Burdensome Contracts With Affiliates......................56
Section 8.16. No Changes in Fiscal Year.................................56
Section 8.17. Formation of Subsidiaries.................................56
Section 8.18. Change in the Nature of Business..........................56
Section 8.19. Use of Loan Proceeds......................................57
Section 8.20. Limitations on Subsidiary Distributions and Certain Other
Restrictions.........................................57
Section 8.21. Subordinated Debt.........................................57
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Section 8.22. Total Funded Debt/EBITDA Ratio............................57
Section 8.23. Net Worth.................................................57
Section 8.24. Fixed Charge Coverage Ratio...............................58
Section 8.25. Interest Rate Protection..................................58
Section 8.26. Ownership and Status of ▇▇▇.▇▇▇...........................58
SECTION 9. EVENTS OF DEFAULT AND REMEDIES............................58
Section 9.1. Events of Default.........................................58
Section 9.2. Non-Bankruptcy Defaults...................................60
Section 9.3. Bankruptcy Defaults.......................................61
Section 9.4. Collateral for Undrawn Letters of Credit..................61
Section 9.5. Notice of Default.........................................62
Section 9.6. Expenses..................................................62
SECTION 10. CHANGE IN CIRCUMSTANCES...................................62
Section 10.1. Change of Law.............................................62
Section 10.2. Unavailability of Deposits or Inability to Ascertain, or
Inadequacy of, LIBOR.................................62
Section 10.3. Increased Cost and Reduced Return.........................63
Section 10.4. Lending Offices...........................................64
Section 10.5. Discretion of Lender as to Manner of Funding..............64
SECTION 11. THE ADMINISTRATIVE AGENT..................................64
Section 11.1. Appointment and Authorization of Administrative Agent.....64
Section 11.2. Administrative Agent and its Affiliates...................65
Section 11.3. Action by Administrative Agent............................65
Section 11.4. Consultation with Experts.................................65
Section 11.5. Liability of Administrative Agent; Credit Decision........65
Section 11.6. Indemnity.................................................66
Section 11.7. Resignation of Administrative Agent and Successor
Administrative Agent.................................66
Section 11.8. L/C Issuer................................................67
Section 11.9. Hedging Agreements........................................67
Section 11.10. Designation of Additional Agents..........................67
SECTION 12. THE GUARANTY..............................................68
Section 12.1. The Guaranty..............................................68
Section 12.2. Guarantee Unconditional...................................68
Section 12.3. Discharge Only Upon Payment in Full; Reinstatement in
Certain Circumstances................................69
Section 12.4. Subrogation...............................................69
Section 12.5. Waivers...................................................70
Section 12.6. Limit on Recovery.........................................70
Section 12.7. Stay of Acceleration......................................70
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SECTION 13. MISCELLANEOUS.............................................70
Section 13.1. Withholding Taxes.........................................70
Section 13.2. No Waiver, Cumulative Remedies............................71
Section 13.3. Non-Business Days.........................................71
Section 13.4. Documentary Taxes.........................................72
Section 13.5. Survival of Representations...............................72
Section 13.6. Survival of Indemnities...................................72
Section 13.7. Sharing of Set-Off........................................72
Section 13.8. Notices...................................................72
Section 13.9. Counterparts..............................................73
Section 13.10. Successors and Assigns....................................73
Section 13.11. Participants..............................................73
Section 13.12. Assignments...............................................74
Section 13.13. Amendments................................................76
Section 13.14. Headings..................................................76
Section 13.15. Costs and Expenses; Indemnification.......................76
Section 13.16. Set-off...................................................77
Section 13.17. Entire Agreement..........................................78
Section 13.18. Governing Law.............................................78
Section 13.19. Severability of Provisions................................78
Section 13.20. Excess Interest...........................................78
Section 13.21. Construction..............................................79
Section 13.22. Lender's Obligations Several..............................79
Section 13.23. Submission to Jurisdiction; Waiver of Jury Trial..........79
Signature Page................................................................80
EXHIBIT A - Notice of Payment Request
EXHIBIT B - Notice of Borrowing
EXHIBIT C - Notice of Continuation/Conversion
EXHIBIT D-1 - Revolving Note
EXHIBIT D-2 - Swing Line Note
EXHIBIT E - Compliance Certificate
EXHIBIT F - Assignment and Acceptance
EXHIBIT G - Additional Guarantor Supplement
SCHEDULE 1 - Commitments
SCHEDULE 1.2 - Existing Letters of Credit
SCHEDULE 6.2 - Subsidiaries
SCHEDULE 8.7 - Permitted Existing Indebtedness
SCHEDULE 8.8 - Permitted Existing Liens
SCHEDULE 8.9 - Permitted Existing Investments
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CREDIT AGREEMENT
This Credit Agreement (this "Agreement") is entered into as of
September 27, 2001, by and among Florists' Transworld Delivery, Inc., a Michigan
corporation (the "Borrower"), IOS Brands Corporation, a Delaware corporation
(the "Parent"), and each of the Subsidiaries from time to time becoming a party
to this Agreement, as Guarantors, the several financial institutions from time
to time party to this Agreement, as Lenders, and ▇▇▇▇▇▇ Trust and Savings Bank,
as Administrative Agent as provided herein. All capitalized terms used herein
without definition shall have the same meanings herein as such terms are defined
in Section 5.1 hereof.
PRELIMINARY STATEMENT
The Borrower has requested, and the Lenders have agreed to extend,
certain credit facilities to the Borrower, on the terms and conditions set forth
in this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto hereby agree as follows:
SECTION 1. THE CREDIT FACILITIES.
Section 1.1. Revolving Credit Commitments. Subject to the terms and
conditions hereof, each Lender, by its acceptance hereof, severally agrees to
make a loan or loans (individually a "Revolving Loan" and collectively the
"Revolving Loans") to the Borrower from time to time on a revolving basis up to
the amount of such Lender's Revolving Credit Commitment, subject to any
reductions thereof pursuant to the terms hereof, before the Termination Date.
The sum of the aggregate principal amount of Revolving Loans, Swing Loans and
L/C Obligations at any time outstanding shall not exceed the Revolving Credit
Commitments in effect at such time. Each Borrowing of Revolving Loans shall be
made ratably from the Lenders in proportion to their respective Revolver
Percentages. As provided in Section 1.5(a) hereof, the Borrower may elect that
each Borrowing of Revolving Loans be either Base Rate Loans or Eurodollar Loans.
Revolving Loans may be repaid and the principal amount thereof reborrowed before
the Termination Date, subject to the terms and conditions hereof.
Section 1.2. Letters of Credit. (a) General Terms. Subject to the terms
and conditions hereof, as part of the Revolving Credit, the L/C Issuer shall
issue standby and commercial letters of credit (each a "Letter of Credit") for
the Borrower's account in an aggregate undrawn face amount up to the amount of
the L/C Sublimit, provided that the aggregate L/C Obligations at any time
outstanding shall not exceed the difference between the Revolving Credit
Commitments in effect at such time and the aggregate principal amount of
Revolving Loans and Swing Loans then outstanding. Each Letter of Credit shall be
issued by the L/C Issuer, but each Lender shall be obligated to reimburse the
L/C Issuer for such Lender's Revolver Percentage of the amount of each drawing
thereunder and, accordingly, each Letter of Credit shall constitute usage of the
Revolving Credit Commitment of each Lender pro rata in an amount equal to its
Revolver Percentage of the L/C Obligations then outstanding. The Letters of
Credit shall include, without
limitation, the letters of credit shown on Schedule 1.2 hereto issued by the
Lenders indicated on such Schedule (the "Existing Letters of Credit"), which, on
and after the Closing Date, shall be deemed Letters of Credit issued hereunder
for the purposes of this Agreement and shall without further action by the
Borrower or the issuer of the Existing Letters of Credit, be regarded as
Obligations secured by the Collateral and otherwise be treated by the parties
hereto identically in every respect to Letters of Credit issued on or after the
date of this Agreement.
(b) Applications. At any time before the Termination Date, the L/C
Issuer shall, at the request of the Borrower and with notice to the
Administrative Agent, issue one or more Letters of Credit in U.S. Dollars, in a
form satisfactory to the L/C Issuer and otherwise in compliance with the
provisions of this Agreement, with expiration dates no later than the earlier of
(i) twelve (12) months from the date of issuance (or which are cancelable not
later than twelve (12) months from the date of issuance and each renewal) and
(ii) the date which is thirty (30) days prior to the Termination Date, in an
aggregate face amount as set forth above, upon the receipt of an application
duly executed by the Borrower for the relevant Letter of Credit in the form then
customarily prescribed by the L/C Issuer for the Letter of Credit requested
(each an "Application"). Notwithstanding anything contained in any Application
to the contrary: (i) the Borrower shall pay fees in connection with each Letter
of Credit as set forth in Section 2.1 hereof, (ii) except as otherwise provided
in Section 1.9 hereof, before the occurrence of a Default or an Event of
Default, the L/C Issuer will not call for the funding by the Borrower of any
amount under a Letter of Credit before being presented with a drawing
thereunder, and (iii) if the L/C Issuer is not timely reimbursed for the amount
of any drawing under a Letter of Credit on the date such drawing is paid, the
Borrower's obligation to reimburse the L/C Issuer for the amount of such drawing
shall bear interest (which the Borrower hereby promises to pay) from and after
the date such drawing is paid at a rate per annum equal to the sum of 2% plus
the Applicable Margin plus the Base Rate from time to time in effect (computed
on the basis of a year of 365 or 366 days, as the case may be, and the actual
number of days elapsed). If the L/C Issuer issues any Letter of Credit with an
expiration date that is automatically extended unless the L/C Issuer gives
notice that the expiration date will not so extend beyond its then scheduled
expiration date, the L/C Issuer will give such notice of non-renewal before the
time necessary to prevent such automatic extension if before such required
notice date: (i) the expiration date of such Letter of Credit if so extended
would be after the Termination Date, (ii) the Revolving Credit Commitments have
been terminated, or (iii) a Default or an Event of Default exists and the
Administrative Agent, at the request or with the consent of the Required
Lenders, has given the L/C Issuer instructions not to so permit the extension of
the expiration date of such Letter of Credit. The L/C Issuer agrees to issue
amendments to the Letter(s) of Credit increasing the amount, or extending the
expiration date, thereof at the request of the Borrower subject to the
conditions of Section 7 hereof and the other terms of this Section 1.2.
(c) The Reimbursement Obligations. Subject to Section 1.2(b) hereof,
the obligation of the Borrower to reimburse the L/C Issuer for all drawings
under a Letter of Credit (a "Reimbursement Obligation") shall be governed by the
Application related to such Letter of Credit, except that such reimbursement
shall be made by no later than 12:00 Noon (Chicago time) on the date when each
drawing is paid if the Borrower has been informed of such drawing by the L/C
Issuer on or before 11:30 a.m. (Chicago time) on the date when such drawing is
paid or, if notice of such drawing is given to the Borrower after 11:30 a.m.
(Chicago time) on the date when such
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drawing is paid, by the end of such day, in immediately available funds at the
Administrative Agent's principal office in Chicago, Illinois or such other
office as the Administrative Agent may designate in writing to the Borrower (who
shall thereafter cause to be distributed to the L/C Issuer such amount(s) in
like funds), provided that the provisions of this Section 1.2(c) shall not
affect any right or action of the Borrower against the L/C Issuer for any gross
negligence or willful misconduct in making payment under any Letter of Credit.
If the Borrower does not make any such reimbursement payment on the date due and
the Participating Lenders fund their participations therein in the manner set
forth in Section 1.2(d) below, then all payments thereafter received by the
Administrative Agent in discharge of any of the relevant Reimbursement
Obligations shall be distributed in accordance with Section 1.2(d) below.
(d) The Participating Interests. Each Lender (other than the Lender
then acting as L/C Issuer in issuing Letters of Credit), by its acceptance
hereof, severally agrees to purchase from the L/C Issuer, and the L/C Issuer
hereby agrees to sell to each such Lender (a "Participating Lender"), an
undivided percentage participating interest (a "Participating Interest"), to the
extent of its Revolver Percentage, in each Letter of Credit issued by, and each
Reimbursement Obligation owed to, the L/C Issuer. Upon any failure by the
Borrower to pay any Reimbursement Obligation at the time required on the date
the related drawing is paid, as set forth in Section 1.2(c) above, or if the L/C
Issuer is required at any time to return to the Borrower or to a trustee,
receiver, liquidator, custodian or other Person any portion of any payment of
any Reimbursement Obligation, each Participating Lender shall, not later than
the Business Day it receives a certificate in the form of Exhibit A hereto from
the L/C Issuer (with a copy to the Administrative Agent) to such effect, if such
certificate is received before 1:00 p.m. (Chicago time), or not later than 1:00
p.m. (Chicago time) the following Business Day, if such certificate is received
after such time, pay to the Administrative Agent for the account of the L/C
Issuer an amount equal to such Participating Lender's Revolver Percentage of
such unpaid or recaptured Reimbursement Obligation together with interest on
such amount accrued from the date the related payment was made by the L/C Issuer
to the date of such payment by such Participating Lender at a rate per annum
equal to: (i) from the date the related payment was made by the L/C Issuer to
the date 2 Business Days after payment by such Participating Lender is due
hereunder, the Federal Funds Rate for each such day and (ii) from the date 2
Business Days after the date such payment is due from such Participating Lender
to the date such payment is made by such Participating Lender, the Base Rate in
effect for each such day. Each such Participating Lender shall thereafter be
entitled to receive its Revolver Percentage of each payment received in respect
of the relevant Reimbursement Obligation and of interest paid thereon, with the
L/C Issuer retaining its Revolver Percentage as a Lender hereunder.
The several obligations of the Participating Lenders to the L/C Issuer
under this Section 1.2 shall be absolute, irrevocable and unconditional under
any and all circumstances whatsoever and shall not be subject to any set-off,
counterclaim or defense to payment which any Participating Lender may have or
have had against the Borrower, the L/C Issuer, the Administrative Agent, any
Lender or any other Person whatsoever. Without limiting the generality of the
foregoing, such obligations shall not be affected by any Default or Event of
Default or by any reduction or termination of any Commitment of any Lender, and
each payment by a Participating Lender under this Section 1.2 shall be made
without any offset, abatement, withholding or reduction whatsoever.
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(e) Indemnification. The Participating Lenders shall, to the extent of
their respective Revolver Percentages, indemnify the L/C Issuer (to the extent
not reimbursed by the Borrower) against any cost, expense (including reasonable
counsel fees and disbursements), claim, demand, action, loss or liability
(except such as result from the L/C Issuer's gross negligence or willful
misconduct) that the L/C Issuer may suffer or incur in connection with any
Letter of Credit issued by it. The obligations of the Participating Lenders
under this Section 1.2(e) and all other parts of this Section 1.2 shall survive
termination of this Agreement and of all Applications, Letters of Credit, and
all drafts and other documents presented in connection with drawings thereunder.
Section 1.3. Applicable Interest Rates.
(a) Base Rate Loans. Each Base Rate Loan made or maintained by a Lender
shall bear interest during each Interest Period it is outstanding (computed on
the basis of a year of 365 or 366 days, as the case may be, and the actual days
elapsed) on the unpaid principal amount thereof from the date such Loan is
advanced, continued or created by conversion from a Eurodollar Loan until
maturity (whether by acceleration or otherwise) at a rate per annum equal to the
sum of the Applicable Margin plus the Base Rate from time to time in effect,
payable on the last day of its Interest Period and at maturity (whether by
acceleration or otherwise). The applicable interest rate for each Base Rate Loan
shall change simultaneously with each change in the Base Rate.
"Base Rate" means for any day the greater of: (i) the rate of interest
announced by the Administrative Agent from time to time as its prime commercial
rate as in effect on such day, with any change in the Base Rate resulting from a
change in said prime commercial rate to be effective as of the date of the
relevant change in said prime commercial rate (it being acknowledged and agreed
that such rate may not be the Administrative Agent's best or lowest rate) and
(ii) the sum of (x) the rate determined by the Administrative Agent to be the
average (rounded upward, if necessary, to the next higher 1/100 of 1%) of the
rates per annum quoted to the Administrative Agent at approximately 10:00 a.m.
(Chicago time) (or as soon thereafter as is practicable) on such day (or, if
such day is not a Business Day, on the immediately preceding Business Day) by
two or more Federal funds brokers selected by the Administrative Agent for sale
to the Administrative Agent at face value of Federal funds in the secondary
market in an amount equal or comparable to the principal amount owed to the
Administrative Agent for which such rate is being determined, plus (y) 1/2 of
1%.
(b) Eurodollar Loans. Each Eurodollar Loan made or maintained by a
Lender shall bear interest during each Interest Period it is outstanding
(computed on the basis of a year of 360 days and actual days elapsed) on the
unpaid principal amount thereof from the date such Loan is advanced, continued
or created by conversion from a Base Rate Loan until maturity (whether by
acceleration or otherwise) at a rate per annum equal to the sum of the
Applicable Margin plus the Adjusted LIBOR applicable for such Interest Period,
payable on the last day of the Interest Period and at maturity (whether by
acceleration or otherwise), and, if the applicable Interest Period is longer
than three months, on each day occurring every three months after the
commencement of such Interest Period.
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"Adjusted LIBOR" means, for any Borrowing of Eurodollar Loans, a rate
per annum determined in accordance with the following formula:
Adjusted LIBOR = LIBOR
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1 - Eurodollar Reserve Percentage
"Eurodollar Reserve Percentage" means, for any Borrowing of Eurodollar
Loans for any Interest Period, the daily average for the applicable Interest
Period of the maximum rate, expressed as a decimal, at which reserves
(including, without limitation, any supplemental, marginal and emergency
reserves) are imposed during such Interest Period by the Board of Governors of
the Federal Reserve System (or any successor) on "eurocurrency liabilities", as
defined in such Board's Regulation D (or in respect of any other category of
liabilities that includes deposits by reference to which the interest rate on
Eurodollar Loans is determined or any category of extensions of credit or other
assets that include loans by non-United States offices of any Lender to United
States residents), subject to any amendments of such reserve requirement by such
Board or its successor, taking into account any transitional adjustments
thereto. For purposes of this definition, the Eurodollar Loans shall be deemed
to be "eurocurrency liabilities" as defined in Regulation D without benefit or
credit for any prorations, exemptions or offsets under Regulation D.
"LIBOR" means, for any Interest Period for a Borrowing of Eurodollar
Loans, (a) the LIBOR Index Rate for such Interest Period, if such rate is
available, and (b) if the LIBOR Index Rate cannot be determined, the arithmetic
average of the rates of interest per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) at which deposits in U.S. Dollars in immediately
available funds are offered to the Administrative Agent at 11:00 a.m. (London,
England time) 2 Business Days before the beginning of such Interest Period by 3
or more major banks in the interbank eurodollar market selected by the
Administrative Agent for delivery on the first day of and for a period equal to
such Interest Period and in an amount equal or comparable to the principal
amount of the Eurodollar Loan scheduled to be made by the Administrative Agent
as part of such Borrowing.
"LIBOR Index Rate" means, for any Interest Period, the rate per annum
(rounded upwards, if necessary, to the next higher one hundred-thousandth of a
percentage point) for deposits in U.S. Dollars for a period equal to such
Interest Period, which appears on the Telerate Page 3750 as of 11:00 a.m.
(London, England time) on the day 2 Business Days before the commencement of
such Interest Period.
"Telerate Page 3750" means the display designated as "Page 3750" on the
Dow ▇▇▇▇▇ Telerate Service (or such other page as may replace Page 3750 on that
service or such other service as may be nominated by the British Bankers'
Association as the information vendor for the purpose of displaying British
Bankers' Association Interest Settlement Rates for U.S. Dollar deposits).
(c) Rate Determinations. The Administrative Agent shall determine each
interest rate applicable to the Loans and the Reimbursement Obligations
hereunder, and its determination thereof shall be conclusive and binding except
in the case of manifest error.
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Section 1.4. Minimum Borrowing Amounts; Maximum Eurodollar Loans. Each
Borrowing of Base Rate Loans advanced under a Credit shall be in an amount not
less than $1,000,000 or such greater amount which is an integral multiple of
$100,000. Each Borrowing of Eurodollar Loans advanced, continued or converted
under a Credit shall be in an amount equal to $2,000,000 or such greater amount
which is an integral multiple of $100,000. Without the Administrative Agent's
consent, there shall not be more than 10 Borrowings of Eurodollar Loans
outstanding under a Credit at any one time outstanding.
Section 1.5. Manner of Borrowing Loans and Designating Applicable
Interest Rates.
(a) Notice to the Administrative Agent. The Borrower shall give notice
to the Administrative Agent by no later than 10:00 a.m. (Chicago time): (i) at
least 3 Business Days before the date on which the Borrower requests the Lenders
to advance a Borrowing of Eurodollar Loans and (ii) on the date the Borrower
requests the Lenders to advance a Borrowing of Base Rate Loans. The Loans
included in each Borrowing shall bear interest initially at the type of rate
specified in such notice of a new Borrowing. If no election is made as to the
type of Loan, such notice shall be deemed a request for a Borrowing of Base Rate
Loans. Thereafter, the Borrower may from time to time elect to change or
continue the type of interest rate borne by each Borrowing or, subject to
Section 1.4's minimum amount requirement for each outstanding Borrowing, a
portion thereof, as follows: (i) if such Borrowing is of Eurodollar Loans, on
the last day of the Interest Period applicable thereto, the Borrower may
continue part or all of such Borrowing as Eurodollar Loans or convert part or
all of such Borrowing into Base Rate Loans or (ii) if such Borrowing is of Base
Rate Loans, on any Business Day, the Borrower may convert all or part of such
Borrowing into Eurodollar Loans for an Interest Period or Interest Periods
specified by the Borrower. The Borrower shall give all such notices requesting
the advance, continuation or conversion of a Borrowing to the Administrative
Agent by telephone or telecopy (which notice shall be irrevocable once given
and, if by telephone, shall be promptly confirmed in writing), which notices
shall be substantially in the form attached hereto as Exhibit B (Notice of
Borrowing) or Exhibit C (Notice of Continuation/Conversion), as applicable, or
in such other form acceptable to the Administrative Agent. Notices of the
continuation of a Borrowing of Eurodollar Loans for an additional Interest
Period or of the conversion of part or all of a Borrowing of Base Rate Loans
into Eurodollar Loans must be given by no later than 10:00 a.m. (Chicago time)
at least 3 Business Days before the date of the requested continuation or
conversion. All such notices concerning the advance, continuation or conversion
of a Borrowing shall specify the date of the requested advance, continuation or
conversion of a Borrowing (which shall be a Business Day), the amount of the
requested Borrowing to be advanced, continued or converted, the type of Loans to
comprise such new, continued or converted Borrowing and, if such Borrowing is to
be comprised of Eurodollar Loans, the Interest Period applicable thereto. The
Borrower agrees that the Administrative Agent may rely on any such telephonic or
telecopy notice given by any person the Administrative Agent in good faith
believes is an Authorized Representative without the necessity of independent
investigation, and in the event any such notice by telephone conflicts with any
written confirmation, such telephonic notice shall govern if the Administrative
Agent has acted in reliance thereon.
(b) Notice to the Lenders. The Administrative Agent shall give
telephonic or telecopy notice to each Lender of any notice from the Borrower
received pursuant to Section 1.5(a) above
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and, if such notice requests the Lenders to make Eurodollar Loans, the
Administrative Agent shall give notice to the Borrower and each Lender by like
means of the interest rate applicable thereto promptly after the Administrative
Agent has made such determination.
(c) Borrower's Failure to Notify; Automatic Continuations and
Conversions. Any outstanding Borrowing of Base Rate Loans shall automatically be
continued for an additional Interest Period on the last day of its then current
Interest Period unless the Borrower has notified the Administrative Agent within
the period required by Section 1.5(a) that the Borrower intends to convert such
Borrowing, subject to Section 7.1 hereof, into a Borrowing of Eurodollar Loans
or such Borrowing is prepaid in accordance with Section 1.9(a). If the Borrower
fails to give notice pursuant to Section 1.5(a) above of the continuation or
conversion of any outstanding principal amount of a Borrowing of Eurodollar
Loans before the last day of its then current Interest Period within the period
required by Section 1.5(a) or, whether or not such notice has been given, one or
more of the conditions set forth in Section 7.1 for the continuation or
conversion of a Borrowing of Eurodollar Loans would not be satisfied, and such
Borrowing is not prepaid in accordance with Section 1.9(a), such Borrowing shall
automatically be converted into a Borrowing of Base Rate Loans. In the event the
Borrower fails to give notice pursuant to Section 1.5(a) above of a Borrowing
equal to the amount of a Reimbursement Obligation and has not notified the
Administrative Agent by 1:00 p.m. (Chicago time) on the day such Reimbursement
Obligation becomes due that it intends to repay such Reimbursement Obligation
through funds not borrowed under this Agreement, the Borrower shall be deemed to
have requested a Borrowing of Base Rate Loans under the Revolving Credit (or, at
the option of the Administrative Agent, under the Swing Line) on such day in the
amount of the Reimbursement Obligation then due, which Borrowing shall be
applied to pay the Reimbursement Obligation then due.
(d) Disbursement of Loans. Not later than 1:00 p.m. (Chicago time) on
the date of any requested advance of a new Borrowing, subject to Section 7
hereof, each Lender shall make available its Loan comprising part of such
Borrowing in funds immediately available at the principal office of the
Administrative Agent in Chicago, Illinois. The Administrative Agent shall make
the proceeds of each new Borrowing available to the Borrower at the
Administrative Agent's principal office in Chicago, Illinois (or by wire
transfer of funds pursuant to the Borrower's written instructions to the
Administrative Agent).
(e) Administrative Agent Reliance on Lender Funding. Unless the
Administrative Agent shall have been notified by a Lender prior to (or, in the
case of a Borrowing of Base Rate Loans, by 1:00 p.m. (Chicago time) on) the date
on which such Lender is scheduled to make payment to the Administrative Agent of
the proceeds of a Loan (which notice shall be effective upon receipt) that such
Lender does not intend to make such payment, the Administrative Agent may assume
that such Lender has made such payment when due and the Administrative Agent may
in reliance upon such assumption (but shall not be required to) make available
to the Borrower the proceeds of the Loan to be made by such Lender and, if any
Lender has not in fact made such payment to the Administrative Agent, such
Lender shall, on demand, pay to the Administrative Agent the amount made
available to the Borrower attributable to such Lender together with interest
thereon in respect of each day during the period commencing on the date such
amount was made available to the Borrower and ending on (but excluding) the date
such
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Lender pays such amount to the Administrative Agent at a rate per annum
equal to: (i) from the date the related advance was made by the Administrative
Agent to the date 2 Business Days after payment by such Lender is due hereunder,
the Federal Funds Rate for each such day and (ii) from the date 2 Business Days
after the date such payment is due from such Lender to the date such payment is
made by such Lender, the Base Rate in effect for each such day. If such amount
is not received from such Lender by the Administrative Agent immediately upon
demand, the Borrower will, on demand, repay to the Administrative Agent the
proceeds of the Loan attributable to such Lender with interest thereon at a rate
per annum equal to the interest rate applicable to the relevant Loan, but
without such payment being considered a payment or prepayment of a Loan under
Section 1.12 hereof so that the Borrower will have no liability under such
Section with respect to such payment. Nothing set forth in this Section 1.5(e)
shall relieve any Lender of its obligation to make payment of the proceeds of a
Loan in accordance with the terms of this Agreement.
Section 1.6. Swing Loans.
(a) Generally. Subject to all of the terms and conditions hereof, the
Administrative Agent agrees to make loans to the Borrower under the Swing Line
(individually a "Swing Loan" and collectively the "Swing Loans") which shall not
in the aggregate at any time outstanding exceed the lesser of (i) $5,000,000 (as
the same may be reduced pursuant hereto, the "Swing Line Commitment") or (ii)
the difference between the Revolving Credit Commitments in effect at such time
and the aggregate amount of all Revolving Loans and L/C Obligations outstanding
at the time of computation. The Swing Line Commitment shall be available to the
Borrower and may be availed of by the Borrower from time to time and Borrowings
thereunder may be repaid and used again during the period ending on the
Termination Date; provided that each Swing Loan must be repaid on the last day
of the Interest Period applicable thereto. Each Swing Loan shall be in a minimum
amount of $100,000 or such greater amount which is an integral multiple of
$50,000.
(b) Interest on Swing Loans. Each Swing Loan shall bear interest until
maturity (whether by acceleration or otherwise) at a rate per annum equal to (i)
the sum of the Base Rate plus the Applicable Margin for Base Rate Loans under
the Revolving Credit as from time to time in effect (computed on the basis of a
year of 365 or 366 days, as the case may be, for the actual number of days
elapsed) or (ii) if accepted by the Borrower pursuant to Section 1.6(c) below,
the Administrative Agent's Quoted Rate (computed on the basis of a year of 360
days for the actual number of days elapsed). Interest on each Swing Loan shall
be due and payable on the last day of each Interest Period applicable thereto.
(c) Requests for Swing Loans. The Borrower shall give the
Administrative Agent prior notice (which may be written or oral) no later than
12:00 Noon (Chicago time) in the case of a Swing Loan to bear interest at the
Administrative Agent's Quoted Rate and 2:00 p.m. (Chicago time) in the case of
any other Swing Loan in each case on the date upon which the Borrower requests
that such Swing Loan be made, of the amount and date of such Swing Loan and the
Interest Period requested therefor. Within thirty (30) minutes after receiving
such notice, the Administrative Agent shall in its discretion quote an interest
rate to the Borrower at which the Administrative Agent would be willing to make
such Swing Loan available to the Borrower for
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the Interest Period so requested (the rate so quoted for a given Interest Period
being herein referred to as "Administrative Agent's Quoted Rate"). The Borrower
acknowledges and agrees that the interest rate quote is given for immediate and
irrevocable acceptance, and if the Borrower does not so immediately accept the
Administrative Agent's Quoted Rate for the full amount requested by the Borrower
for such Swing Loan, the Administrative Agent's Quoted Rate shall be deemed
immediately withdrawn and such Swing Loan shall bear interest at the rate per
annum determined by adding the Applicable Margin for Base Rate Loans under the
Revolving Credit to the Base Rate as from time to time in effect. Subject to all
of the terms and conditions hereof, the proceeds of such Swing Loan shall be
made available to the Borrower on the date so requested at the Administrative
Agent's principal office in Chicago, Illinois (or by wire transfer of funds
pursuant to the Borrower's written instructions to the Administrative Agent).
Anything contained in the foregoing to the contrary notwithstanding, (i) the
obligation of the Administrative Agent to make Swing Loans shall be subject to
all of the terms and conditions of this Agreement and (ii) the Administrative
Agent shall not be obligated to make more than one Swing Loan during any one
day.
(d) Refunding Loans. In its sole and absolute discretion, the
Administrative Agent may at any time, on behalf of the Borrower (which hereby
irrevocably authorizes the Administrative Agent to act on its behalf for such
purpose) and with notice to the Borrower, request each Lender to make a
Revolving Loan in the form of a Base Rate Loan in an amount equal to such
Lender's Revolver Percentage of the amount of the Swing Loans outstanding on the
date such notice is given. Unless any of the conditions of Section 7.1 are not
fulfilled on such date, each Lender shall make the proceeds of its requested
Revolving Loan available to the Administrative Agent, in immediately available
funds, at the Administrative Agent's principal office in Chicago, Illinois,
before 12:00 Noon (Chicago time) on the Business Day following the day such
notice is given. The proceeds of such Borrowing of Revolving Loans shall be
immediately applied to repay the outstanding Swing Loans.
(e) Participations. If any Lender refuses or otherwise fails to make a
Revolving Loan when requested by the Administrative Agent pursuant to Section
1.6(d) above (because the conditions in Section 7.1 are not satisfied or
otherwise), such Lender shall, by the time and in the manner such Revolving Loan
was to have been funded to the Administrative Agent, purchase from the
Administrative Agent an undivided participating interest in the outstanding
Swing Loans in an amount equal to its Revolver Percentage of the aggregate
principal amount of Swing Loans that were to have been repaid with such
Revolving Loans. Each Lender that so purchases a participation in a Swing Loan
shall thereafter be entitled to receive its Revolver Percentage of each payment
of principal received on the Swing Loan and of interest received thereon
accruing from the date such Lender funded to the Administrative Agent its
participation in such Loan. The several obligations of the Lenders under this
Section 1.6(e) shall be absolute, irrevocable and unconditional under any and
all circumstances whatsoever and shall not be subject to any set-off,
counterclaim or defense to payment which any Lender may have or have had against
the Borrower, any other Lender or any other Person whatever. Without limiting
the generality of the foregoing, such obligations shall not be affected by any
Default or Event of Default or by any reduction or termination of the
Commitments of any Lender, and each payment made by a Lender under this Section
1.6(e) shall be made without any offset, abatement, withholding or reduction
whatsoever.
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Section 1.7. Interest Periods. As provided in Section 1.5(a) hereof, at
the time of each request to advance, continue, or create by conversion a
Borrowing of Eurodollar Loans or to advance a Borrowing of Swing Loans, the
Borrower shall select an Interest Period applicable to such Loans from among the
available options. The term "Interest Period" means the period commencing on the
date a Borrowing of Loans is advanced, continued or created by conversion and
ending: (a) in the case of Base Rate Loans, on the last day of the calendar
quarter (commencing September 30, 2001, and on the last day of each December,
March, June, and September thereafter) in which such Borrowing is advanced,
continued or created by conversion (or on the last day of the following calendar
quarter if such Loan is advanced, continued or created by conversion on the last
day of a calendar quarter) and (b) in the case of a Eurodollar Loan, the date
that is one, two, three or six months thereafter and (c) in the case of Swing
Loans, on the date one (1) to five (5) days thereafter as mutually agreed by the
Administrative Agent and the Borrower; provided, however, that:
(a) any Interest Period for a Borrowing of Revolving Loans or
Swing Loans consisting of Base Rate Loans that otherwise would end
after the Termination Date shall end on the Termination Date;
(b) no Interest Period with respect to any portion of the
Revolving Loans or Swing Loans shall extend beyond the Termination
Date;
(c) whenever the last day of any Interest Period would
otherwise be a day that is not a Business Day, the last day of such
Interest Period shall be extended to the next succeeding Business Day,
provided that, if such extension would cause the last day of an
Interest Period for a Borrowing of Eurodollar Loans to occur in the
following calendar month, the last day of such Interest Period shall be
the immediately preceding Business Day; and
(d) for purposes of determining an Interest Period for a
Borrowing of Eurodollar Loans, a month means a period starting on one
day in a calendar month and ending on the numerically corresponding day
in the next calendar month; provided, however, that if there is no
numerically corresponding day in the month in which such an Interest
Period is to end or if such an Interest Period begins on the last
Business Day of a calendar month, then such Interest Period shall end
on the last Business Day of the calendar month in which such Interest
Period is to end.
Section 1.8. Maturity of Loans.
(a) Revolving Loans. Each Revolving Loan, both for principal and
interest, shall mature and become due and payable by the Borrower on the
Termination Date.
(b) Swing Loans. Each Swing Loan, both for principal and interest,
shall mature and become due and payable by the Borrower on the last day of the
Interest Period applicable thereto.
Section 1.9. Prepayments.
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(a) Optional. The Borrower shall have the privilege of prepaying
without premium or penalty (except as set forth in Section 1.12 below) and in
whole or in part (but, if in part, then: (i) if such Borrowing is of Base Rate
Loans, in an amount not less than $500,000, (ii) if such Borrowing is of
Eurodollar Loans, in an amount not less than $500,000, and (iii) in each case,
in an amount such that the minimum amount required for a Borrowing pursuant to
Section 1.4 hereof remains outstanding) any Borrowing of Eurodollar Loans at any
time upon 3 Business Days prior notice by the Borrower to the Administrative
Agent or, in the case of a Borrowing of Base Rate Loans, notice delivered by the
Borrower to the Administrative Agent no later than 10:00 a.m. (Chicago time) on
the date of prepayment, such prepayment to be made by the payment of the
principal amount to be prepaid and, in the case of any Eurodollar Loans, accrued
interest thereon to the date fixed for prepayment plus any amounts due the
Lenders under Section 1.12 hereof. Swing Loans bearing interest at
Administrative Agent's Quoted Rate may only be voluntarily paid on the last day
of the Interest Period then applicable to such Loans. The Administrative Agent
will promptly advise each Lender of any such prepayment notice it receives from
the Borrower. Any amount of Revolving Loans or Swing Loans paid or prepaid
before the Termination Date may, subject to the terms and conditions of this
Agreement, be borrowed, repaid and borrowed again.
(b) Mandatory. (i) The Borrower shall, on each date the Revolving
Credit Commitments are reduced pursuant to Section 1.13 hereof, whether as a
result of a receipt of Net Cash Proceeds or otherwise, prepay the Revolving
Loans and Swing Loans and, if necessary, prefund the L/C Obligations by the
amount, if any, necessary to reduce the sum of the aggregate principal amount of
Revolving Loans, Swing Loans and of L/C Obligations then outstanding to the
amount to which the Revolving Credit Commitments have been so reduced.
(ii) Unless the Borrower otherwise directs, (x) prepayments of Loans
under this Section 1.9(b) shall be applied first to Borrowings of Base Rate
Loans until payment in full thereof with any balance applied to Borrowings of
Eurodollar Loans in the order in which their Interest Periods expire and (y)
prepayments of Swing Loans under this Section 1.9(b) shall be applied to such
Loans in the order in which their Interest Periods expire. Each prepayment of
Loans under this Section 1.9(b) shall be made by the payment of the principal
amount to be prepaid and, in the case of any Eurodollar Loans, accrued interest
thereon to the date of prepayment together with any amounts due the Lenders
under Section 1.12 hereof. Each prepayment of the Swing Line and Revolving
Credit under this Section 1.9(b) shall first be applied to the Swing Loans until
payment in full thereof, with any remaining balance applied to the Revolving
Loans until payment in full thereof, and with any remaining balance held by the
Administrative Agent as collateral security for the Obligations owing with
respect to the Letters of Credit. Each prefunding of L/C Obligations shall be
made in accordance with Section 9.4 hereof.
(c) The Administrative Agent will promptly advise each Lender of any
notice of prepayment it receives from the Borrower. Any amount of Revolving
Loans or Swing Loans paid or prepaid before the Termination Date may, subject to
the terms and conditions of this Agreement, be borrowed, repaid and borrowed
again.
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Section 1.10. Default Rate. Notwithstanding anything to the contrary
contained in Section 1.3 hereof, while any Event of Default exists or after
acceleration, the Borrower shall pay interest (after as well as before entry of
judgment thereon to the extent permitted by law) on the principal amount of all
Loans owing by it at a rate per annum equal to:
(a) for any Base Rate Loan or any Swing Loan bearing interest
based on the Base Rate, the sum of 2% plus the Applicable Margin plus
the Base Rate from time to time in effect (computed on the basis of a
year of 365 or 366 days, as the case may be, for the actual number of
days elapsed); and
(b) for any Eurodollar Loan or any Swing Loan bearing
interest at the Administrative Agent's Quoted Rate, the sum of 2% plus
the rate of interest in effect thereon at the time of such default
until the end of the Interest Period applicable thereto (computed on
the basis of a year of 360 days for the actual number of days elapsed)
and, thereafter, at a rate per annum equal to the sum of 2% plus the
Applicable Margin for Base Rate Loans plus the Base Rate from time to
time in effect (computed on the basis of a year of 365 or 366 days, as
the case may be, for the actual number of days elapsed);
provided, however, that in the absence of acceleration, any adjustments pursuant
to this Section shall be made at the election of the Administrative Agent,
acting at the request or with the consent of the Required Lenders, with written
notice to the Borrower. While any Event of Default exists or after acceleration,
interest shall be paid on demand of the Administrative Agent at the request or
with the consent of the Required Lenders.
Section 1.11. The Notes. (a) The Revolving Loans made to the Borrower by
a Lender shall be evidenced by a single promissory note of the Borrower issued
to such Lender in the form of Exhibit D-1 hereto. Each such promissory note is
hereinafter referred to as a "Revolving Note" and collectively such promissory
notes are referred to as the "Revolving Notes".
(b) The Swing Loans made to the Borrower by the Administrative Agent
shall be evidenced by a single promissory note of the Borrower issued to the
Administrative Agent in the form of Exhibit D-2 hereto. Such promissory note is
hereinafter referred to as the "Swing Line Note".
(c) Each Lender shall record on its books and records or on a schedule
to its appropriate Note the amount of each Loan advanced, continued or converted
by it, all payments of principal and interest and the principal balance from
time to time outstanding thereon, the type of such Loan, and, for any Eurodollar
Loan, the Interest Period and the interest rate applicable thereto. The record
thereof, whether shown on such books and records of a Lender or on a schedule to
the relevant Note, shall be prima facie evidence as to all such matters;
provided, however, that the failure of any Lender to record any of the foregoing
or any error in any such record shall not limit or otherwise affect the
obligation of the Borrower to repay all Loans made to it hereunder together with
accrued interest thereon. At the request of any Lender and upon such Lender
tendering to the Borrower the appropriate Note to be replaced, the Borrower
shall furnish a new Note to such Lender to replace any outstanding Note, and at
such time the first notation
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appearing on a schedule on the reverse side of, or attached to, such Note shall
set forth the aggregate unpaid principal amount of all Loans, if any, then
outstanding thereon.
Section 1.12. Funding Indemnity. If any Lender shall incur any loss,
cost or expense (including, without limitation, any loss of profit, and any
loss, cost or expense incurred by reason of the liquidation or re-employment of
deposits or other funds acquired by such Lender to fund or maintain any Fixed
Rate Loan or the relending or reinvesting of such deposits or amounts paid or
prepaid to such Lender) as a result of:
(a) any payment, prepayment or conversion of a Fixed Rate
Loan on a date other than the last day of its Interest Period,
(b) any failure (because of a failure to meet the conditions
of Section 7 or otherwise) by the Borrower to borrow or continue a
Fixed Rate Loan, or to convert a Base Rate Loan into a Eurodollar Loan,
on the date specified in a notice given pursuant to Section 1.5(a),
(c) any failure by the Borrower to make any payment of
principal on any Eurodollar Loan when due (whether by acceleration or
otherwise), or
(d) any acceleration of the maturity of a Fixed Rate Loan as
a result of the occurrence of any Event of Default hereunder,
then, upon the demand of such Lender, the Borrower shall pay to such Lender such
amount as will reimburse such Lender for such loss, cost or expense. If any
Lender makes such a claim for compensation, it shall provide to the Borrower,
with a copy to the Administrative Agent, a certificate setting forth the amount
of such loss, cost or expense in reasonable detail and the amounts shown on such
certificate shall be conclusive if reasonably determined.
Section 1.13. Commitment Terminations.
(a) Optional Revolving Credit Terminations. The Borrower shall have the
right at any time and from time to time, upon 5 Business Days' prior written
notice to the Administrative Agent, to terminate the Revolving Credit
Commitments without premium or penalty and in whole or in part, any partial
termination to be (i) in an amount not less than $5,000,000 or any multiple of
$1,000,000 in excess thereof and (ii) allocated ratably among the Lenders in
proportion to their respective Revolver Percentages, provided that the Revolving
Credit Commitments may not be reduced to an amount less than the sum of the
aggregate principal amount of Revolving Loans, Swing Loans and of L/C
Obligations then outstanding. Any termination of the Revolving Credit
Commitments below $15,000,000 shall reduce the L/C Sublimit to a like amount.
Any termination of the Revolving Credit Commitments below $5,000,000 shall
reduce the Swing Line Commitment to like amount. The Administrative Agent shall
give prompt notice to each Lender of any such termination of the Revolving
Credit Commitments.
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(b) Mandatory Revolving Credit Terminations. (i) If, after the Closing
Date, the Borrower or any Subsidiary shall at any time or from time to time make
or agree to make a Disposition or shall suffer an Event of Loss resulting in Net
Cash Proceeds in excess of $10,000,000 on a cumulative basis during the term of
this Agreement, then (x) the Borrower shall promptly notify the Administrative
Agent of such proposed Disposition or Event of Loss (including the amount of the
estimated Net Cash Proceeds to be received by the Borrower or such Subsidiary in
respect thereof) and (y) on the Business Day of receipt by the Borrower or such
Subsidiary of the Net Cash Proceeds of such Disposition or Event of Loss, the
Revolving Credit Commitments shall ratably terminate by an amount equal to 100%
of the amount of such Net Cash Proceeds in excess of such minimum amount set
forth above, provided that, in no event shall the Revolving Credit Commitments
be reduced to an amount less than $55,000,000 in the aggregate, provided
further, that in the case of each Disposition and Event of Loss, if the Borrower
states in its notice of such event that the Borrower or the applicable
Subsidiary intends to reinvest, within 120 days of the applicable Disposition or
receipt of Net Cash Proceeds from an Event of Loss, the Net Cash Proceeds
thereof in assets similar to the assets which were subject to such Disposition
or Event of Loss, then so long as no Default or Event of Default then exists,
such reduction of the Revolving Credit Commitments shall not occur under this
Section in respect of such Net Cash Proceeds to the extent such Net Cash
Proceeds are actually reinvested in such similar assets within such 120-day
period. Promptly after the end of such 120-day period, the Borrower shall notify
the Administrative Agent whether the Borrower or such Subsidiary has reinvested
such Net Cash Proceeds in such similar assets, and to the extent such Net Cash
Proceeds have not been so reinvested, such reduction of the Revolving Credit
Commitments in the amount of such Net Cash Proceeds not so reinvested shall
occur, provided that in no event shall the Revolving Credit Commitments be
reduced to an amount less than $55,000,000 in the aggregate. The amount of any
prepayment resulting from such reduction shall first be applied to the Swing
Loans until paid in full and then the Revolving Credit Loans until payment in
full thereof with any remaining balance to be held by the Administrative Agent
as collateral security for the L/C Obligations.
(ii) If, after the Closing Date, the Borrower or any Subsidiary shall
issue new equity securities (whether common or preferred stock or otherwise),
other than equity securities issued in connection with the exercise of employee
stock options and capital stock issued in connection with the sale of an
Acquired Business in connection with a Permitted Acquisition, the Borrower shall
promptly notify the Administrative Agent of the estimated Net Cash Proceeds of
such issuance to be received by or for the account of the Borrower or such
Subsidiary in respect thereof. No later than one Business Day after receipt by
the Borrower or such Subsidiary of Net Cash Proceeds of such issuance, the
Revolving Credit Commitments shall ratably terminate by an aggregate amount
equal to 50% of the amount of such Net Cash Proceeds with any prepayment
resulting from such reduction first to be applied to the Swing Loans until paid
in full and then the Revolving Credit Loans until payment in full thereof with
any remaining balance to be held by the Administrative Agent as collateral
security for the L/C Obligations, provided that in no event shall the Revolving
Credit Commitments be reduced to an amount less than $55,000,000 in the
aggregate. The Borrower acknowledges that its performance hereunder shall not
limit the rights and remedies of the Lenders for any breach of any other terms
of this Agreement.
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(iii) If, after the Closing Date, the Borrower or any Subsidiary shall
issue any Indebtedness for Borrowed Money, other than Indebtedness for Borrowed
Money permitted by Section 8.7 hereof, the Borrower shall promptly notify the
Administrative Agent of the estimated Net Cash Proceeds of such issuance to be
received by or for the account of the Borrower or such Subsidiary in respect
thereof. No later than one Business Day after receipt by the Borrower or such
Subsidiary of Net Cash Proceeds of such issuance, the Revolving Credit
Commitments shall ratably terminate by an aggregate amount equal to 100% of the
amount of such Net Cash Proceeds with any prepayment resulting therefrom first
to be applied to the Swing Loans until paid in full and then the Revolving
Credit Loans until payment in full thereof with any remaining balance to be held
by the Administrative Agent as collateral security for the L/C Obligations,
provided that in no event shall the Revolving Credit Commitments be reduced to
an amount less than $55,000,000 in the aggregate. The Borrower acknowledges that
its performance hereunder shall not limit the rights and remedies of the Lenders
for any breach of Section 8.7 hereof or any other terms of this Agreement.
(iv) The Revolving Credit Commitments shall terminate in part at such
times and in such amounts as are set forth on Schedule 1 hereto.
(c) Mandatory Termination Upon a Change of Control. After the
occurrence of a Change of Control, the Required Lenders may, by written notice
to the Borrower at any time on or before the date occurring 90 days after the
date the Borrower notifies the Lenders of such Change of Control, terminate the
remaining Commitments and all other obligations of the Lenders hereunder on the
date stated in such notice (which may be the date of such notice). On the date
the Commitments are so terminated, all outstanding Obligations (including,
without limitation, all principal of and accrued interest on the Notes) shall
forthwith be due and payable without further demand, presentment, protest or
notice of any kind and the Borrower shall immediately pay to the Lenders the
full amount then available for drawing under each Letter of Credit, such amount
to be held in the Collateral Account (the Borrower agreeing to immediately make
such payment on the date the Commitments are so terminated and acknowledging and
agreeing that the Lenders would not have an adequate remedy at law for the
failure by the Borrower to honor any such demand and that the Lenders, and the
Administrative Agent on their behalf, shall have the right to require the
Borrower to specifically perform such undertaking whether or not any drawings or
other demands for payment have been made under any of the Letters of Credit).
(d) Any reduction of the Revolving Credit Commitments pursuant to
clauses (b)(i), (ii) or (iii) of this Section 1.13 will automatically reduce the
amount of the next scheduled reduction in the Revolving Credit Commitments
pursuant to clause (b)(iv) of this Section 1.13 hereof by an amount equal to the
lesser of (x) the amount of such reduction pursuant to clause (b)(i), (ii) or
(iii), or (y) the full amount of such next scheduled reduction in the Revolving
Credit Commitments pursuant to said clause (b)(iv); to the extent the amounts in
subclause (x) above exceed the amounts in subclause (y) above, such excess shall
be carried forward and applied to reduce, in direct order, subsequent scheduled
reductions in the Revolving Credit Commitments.
(e) Any termination of the Commitments pursuant to this Section 1.13
may not be reinstated.
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Section 1.14. Substitution of Lenders. Upon the receipt by the Borrower
of (a) a claim from any Lender for compensation under Section 10.3 or 13.1
hereof, or (b) notice by any Lender to the Borrower of any illegality pursuant
to Section 10.1 hereof, or (c) in the event that any Lender is in default in any
material respect with respect to its obligations under the Loan Documents (any
such Lender referred to in clause (a), (b) or (c) above being hereinafter
referred to as an "Affected Lender"), the Borrower may, in addition to any other
rights the Borrower may have hereunder or under applicable law, require, at its
expense, any such Affected Lender to assign, at par plus accrued interest and
fees, without recourse, all of its interest, rights and obligations hereunder
(including all of its Commitments and the Loans and participation interests in
Letters of Credit and other amounts at any time owing to it hereunder and the
other Loan Documents) to a bank or other institutional lender specified by the
Borrower, provided that (i) such assignment shall not conflict with or violate
any law, rule or regulation or order of any court or other governmental
authority, (ii) the Borrower shall have received the written consent of the
Administrative Agent, which consent shall not be unreasonably withheld, to such
assignment, (iii) the Borrower shall have paid to the Affected Lender all monies
(together with, except in the case of clause (c), above, amounts due such
Affected Lender under Section 1.12 hereof as if the Loans owing to it were
prepaid rather than assigned) other than such principal, interest and fees
accrued and owing to it hereunder, and (iv) the assignment is entered into in
accordance with the other requirements of Section 13.12 hereof.
Section 1.15. Additional Lender. The Borrower may request that the
aggregate Revolving Credit Commitments be increased by $5,000,000 to a total of
$85,000,000 by offering such increase to one bank or other financial institution
not already party hereto (such bank or other financial institution being
hereinafter referred to as the "Additional Lender") selected by the Borrower and
acceptable to the Administrative Agent. Such increase in the Revolving Credit
Commitments shall be subject to the satisfaction of the following conditions:
(a) the Administrative Agent shall have received an acknowledgement agreement
providing for such increase in form and substance satisfactory to it executed by
the Borrower, the Administrative Agent, and the Additional Lender; and (b) the
Administrative Agent shall have received a Revolving Note duly executed by the
Borrower in favor of the Additional Lender. Upon the satisfaction of such
conditions, effective as of the date set forth above in such acknowledgement
agreement, the Additional Lender shall thereafter be a "Lender" party to this
Agreement and shall be entitled to all rights, benefits and privileges afforded
a Lender hereunder and subject to the obligations of a Lender hereunder to the
extent of its Revolving Credit Commitment and Schedule 1 shall be deemed amended
reflecting the increase in the aggregate Revolving Credit Commitments caused by
the inclusion of the Revolving Credit Commitment of the Additional Lender.
Concurrently with the effectiveness of such increase, the Additional Lender
shall fund its Revolver Percentage of the outstanding Revolving Loans and
overdue Reimbursement Obligations, if any, to the Administrative Agent so that
after giving effect thereto each Lender, including the Additional Lender, holds
a pro rata share (in accordance with its Revolver Percentage) of the outstanding
Revolving Loans and L/C Obligations and the Borrower shall pay to each Lender
all amounts due under Section 1.12 hereof as a result of any prepayment of any
outstanding Eurodollar Loans.
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SECTION 2. FEES.
Section 2.1. Fees.
(a) Revolving Credit Commitment Fee. The Borrower shall pay to the
Administrative Agent for the ratable account of the Lenders in accordance with
their Revolver Percentages a commitment fee at the rate per annum equal to the
Applicable Margin (computed on the basis of a year of 360 days and the actual
number of days elapsed) on the average daily Unused Revolving Credit
Commitments. Such commitment fee shall be payable quarterly in arrears on the
last day of each March, June, September and December in each year (commencing on
September 30, 2001) and on the Termination Date, unless the Revolving Credit
Commitments are terminated in whole on an earlier date, in which event the
commitment fee for the period to the date of such termination in whole shall be
paid on the date of such termination.
(b) Letter of Credit Fees. On the date of issuance or extension, or
increase in the amount, of any Letter of Credit pursuant to Section 1.2 hereof,
the Borrower shall pay to the L/C Issuer for its own account an issuance fee
equal to 0.125% per annum (computed on the basis of a year of 360 days and the
actual number of days elapsed) of the face amount of (or of the increase in the
face amount of) such Letter of Credit. Quarterly in arrears, on the last day of
each March, June, September and December, commencing on September 30, 2001, the
Borrower shall pay to the Administrative Agent, for the ratable benefit of the
Lenders in accordance with their Revolver Percentages, a letter of credit fee at
a rate per annum equal to (i) the Applicable Margin for Eurodollar Loans
(computed on the basis of a year of 360 days and the actual number of days
elapsed) in effect during each day of such quarter applied to the daily average
face amount of standby Letters of Credit outstanding during such quarter, and
(ii) 50% of the Applicable Margin for Eurodollar Loans (computed on the basis of
a year of 360 days and the actual number of days elapsed) in effect during each
day of such quarter applied to the daily average face amount of commercial
Letters of Credit outstanding during such quarter. In addition, the Borrower
shall pay to the L/C Issuer for its own account the L/C Issuer's standard
drawing, negotiation, amendment, and other administrative fees for each Letter
of Credit. Such standard fees referred to in the preceding sentence may be
established by the L/C Issuer from time to time.
(c) Administrative Agent Fees. The Borrower shall pay to the
Administrative Agent, for its own use and benefit, the fees agreed to between
the Administrative Agent and the Borrower in a fee letter dated June 13, 2001,
or as otherwise agreed to in writing between them.
(d) Audit Fees. The Borrower shall pay to the Administrative Agent for
its own use and benefit charges for audits of the Collateral performed by the
Administrative Agent or its agents or representatives in such amounts as the
Administrative Agent may from time to time request (the Administrative Agent
acknowledging and agreeing that such charges shall be computed in the same
manner as it at the time customarily uses for the assessment of charges for
similar collateral audits); provided, however, that in the absence of any
Default and Event of Default, the Borrower shall not be required to pay the
Administrative Agent for more than one such audit per calendar year.
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SECTION 3. PLACE AND APPLICATION OF PAYMENTS.
Section 3.1. Place and Application of Payments. All payments of
principal of and interest on the Loans and the Reimbursement Obligations, and of
all other Obligations payable by the Borrower under this Agreement and the other
Loan Documents, shall be made by the Borrower to the Administrative Agent by no
later than 12:00 Noon (Chicago time) on the due date thereof at the office of
the Administrative Agent in Chicago, Illinois (or such other location as the
Administrative Agent may designate to the Borrower) for the benefit of the
Lender or Lenders entitled thereto. Any payments received after such time shall
be deemed to have been received by the Administrative Agent on the next Business
Day. All such payments shall be made in U.S. Dollars, in immediately available
funds at the place of payment, in each case without set-off or counterclaim. The
Administrative Agent will promptly thereafter cause to be distributed like funds
relating to the payment of principal or interest on Loans and on Reimbursement
Obligations in which the Lenders have purchased Participating Interests ratably
to the Lenders and like funds relating to the payment of any other amount
payable to any Lender to such Lender, in each case to be applied in accordance
with the terms of this Agreement.
Anything contained herein to the contrary notwithstanding, all payments
and collections received in respect of the Obligations and all proceeds of the
Collateral received, in each instance, by the Administrative Agent or any of the
Lenders after the occurrence and during the continuation of an Event of Default
shall be remitted to the Administrative Agent and distributed as follows:
(a) first, to the payment of any outstanding costs and
expenses incurred by the Administrative Agent, and any security trustee
therefor, in monitoring, verifying, protecting, preserving or enforcing
the Liens on the Collateral, in protecting, preserving or enforcing
rights under the Loan Documents, and in any event all costs and
expenses of a character which the Borrower has agreed to pay the
Administrative Agent under Section 13.15 hereof (such funds to be
retained by the Administrative Agent for its own account unless it has
previously been reimbursed for such costs and expenses by the Lenders,
in which event such amounts shall be remitted to the Lenders to
reimburse them for payments theretofore made to the Administrative
Agent);
(b) second, to the payment of principal and interest on the
Swing Line Note;
(c) third, to the payment of principal and interest on the
Revolving Notes, unpaid Reimbursement Obligations, together with
amounts to be held by the Administrative Agent as collateral security
for any outstanding L/C Obligations (until the Administrative Agent is
holding an amount of cash equal to the then outstanding amount of all
such L/C Obligations), unpaid fees and other Obligations due under the
Loan Documents, the aggregate amount paid to, or held as collateral
security for, the Lenders and, in the case of Hedging Liability, their
Affiliates to whom such Obligations are owed, to be allocated pro rata
in accordance with the aggregate unpaid amounts owing to each; and
(d) fourth, to the Borrower or whoever else may be lawfully
entitled thereto.
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SECTION 4. THE COLLATERAL AND GUARANTIES.
Section 4.1. Collateral. The Obligations shall be secured by (a) valid,
perfected and enforceable Liens on all right, title and interest of the Parent,
the Borrower and each Domestic Subsidiary in all capital stock and other equity
interests held by such Person in each of the Subsidiaries and in ▇▇▇.▇▇▇,
whether now owned or hereafter formed or acquired, and all proceeds thereof, and
(b) valid, perfected (subject to the proviso appearing at the end of this
sentence) and enforceable Liens on all right, title and interest of the Parent,
the Borrower and each Domestic Subsidiary in all personal property, including
all accounts, instruments (including all promissory notes), documents, chattel
paper, general intangibles (including, without limitation, patents, trademarks,
tradenames, copyrights, and other intellectual property rights), investment
property, inventory, equipment, fixtures, deposit accounts, and real estate,
whether now owned or hereafter acquired or arising, and all proceeds thereof;
provided, however, that: (i) the Lien of the Administrative Agent on Property
subject to a Capital Lease or conditional sale agreement or subject to a
purchase money lien, in each instance to the extent permitted hereby, shall be
subject to the rights of the lessor or lender thereunder, (ii) until a Default
or Event of Default has occurred and is continuing and thereafter until
otherwise required by the Administrative Agent or the Required Lenders, Liens on
deposit accounts maintained by the Parent, the Borrower and each Domestic
Subsidiary need not be perfected provided that the total amount on deposit at
any one time not so perfected shall not exceed $1,000,000 in the aggregate,
(iii) Liens on more than 65% of the capital stock and other equity interests
held by the Parent or any Domestic Subsidiary in each Foreign Subsidiary, and
Liens on any of the capital stock and other equity interests held by any Foreign
Subsidiary in any other Foreign Subsidiary, need not be granted or perfected to
the extent that such grant or perfection would result in a materially adverse
tax consequences to the Parent, and (iv) until a Default or Event of Default has
occurred and is continuing and thereafter until otherwise required by the
Administrative Agent or the Required Lenders, Liens on vehicles which are
subject to a certificate of title law need not be perfected provided that the
total value of such property at any one time not so perfected shall not exceed
$1,000,000 in the aggregate. The Parent, the Borrower and each Subsidiary
acknowledge and agree that the Liens on the Collateral shall be granted to the
Administrative Agent for the benefit of itself, the Lenders and the L/C Issuer
and shall be valid and perfected first priority Liens subject, however, to the
proviso appearing at the end of the immediately preceding sentence, in each case
pursuant to one or more Collateral Documents from such Persons, each in form and
substance satisfactory to the Administrative Agent. To the extent that any
Collateral is sold or otherwise disposed of as permitted by Section 8.10 hereof,
such Collateral shall be sold or otherwise disposed of free and clear of the
Lien created by the Collateral Documents and the obligations of this Agreement
and the Administrative Agent shall, at the expense of the Borrower, take such
actions as are appropriate and reasonably requested by the Borrower in
connection therewith.
Section 4.2. Liens on Real Property. In the event that the Parent, the
Borrower or any other Domestic Subsidiary (other than Renaissance) owns or
hereafter acquires any real property, the Borrower shall, or shall cause the
Parent or such Domestic Subsidiary to, execute and deliver to the Administrative
Agent (or a security trustee therefor) a mortgage or deed of trust acceptable in
form and substance to the Administrative Agent for the purpose of granting to
the Administrative Agent for the benefit of itself, the Lenders and the L/C
Issuer a Lien on such real
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property to secure the Obligations, shall pay all taxes, costs and expenses
incurred by the Administrative Agent in recording such mortgage or deed of
trust, and shall supply to the Administrative Agent at the Borrower's cost and
expense a survey, environmental report, hazard insurance policy, and a
mortgagee's policy of title insurance from a title insurer acceptable to the
Administrative Agent insuring the validity of such mortgage or deed of trust and
its status as a first Lien (subject to Liens permitted by this Agreement) on the
real property encumbered thereby and such other instrument, documents,
certificates, and opinions reasonably required by the Administrative Agent in
connection therewith.
Section 4.3. Guaranties. The payment and performance of the Obligations
shall at all times be guaranteed by the Parent and each direct and indirect
Domestic Subsidiary, whether now owned or hereafter created or acquired,
pursuant to Section 12 of this Agreement; provided, however, that Renaissance
Greeting Cards, Inc., a Maine corporation (hereinafter "Renaissance"), need not
guarantee the payment and performance of the Obligations.
Section 4.4. Further Assurances. The Borrower agrees that it shall, and
shall cause the Parent and each of the Domestic Subsidiaries to, from time to
time at the request of the Administrative Agent or the Required Lenders, execute
and deliver such documents and do such acts and things as the Administrative
Agent or the Required Lenders may reasonably request in order to provide for or
perfect or protect such Liens on the Collateral. In the event the Parent, the
Borrower or any Subsidiary forms or acquires any other Domestic Subsidiary after
the date hereof, the Borrower shall within 30 Business Days of such formation or
acquisition cause such newly formed or acquired Domestic Subsidiary to execute
an Additional Guarantor Supplement in the form attached hereto as Exhibit G and
such Collateral Documents as the Administrative Agent may then require, and the
Borrower shall also deliver to the Administrative Agent, or cause such
Subsidiary to deliver to the Administrative Agent, at the Borrower's cost and
expense, such other instruments, documents, certificates and opinions reasonably
required by the Administrative Agent in connection therewith.
SECTION 5. DEFINITIONS; INTERPRETATION.
Section 5.1. Definitions. The following terms when used herein shall
have the following meanings:
"Acquired Business" means the entity or assets acquired by the Borrower
or a Subsidiary in an Acquisition, whether before or after the date hereof.
"Acquisition" means any transaction or series of related transactions
for the purpose of or resulting, directly or indirectly, in (a) the acquisition
of all or substantially all of the assets of a Person, or of any business or
division of a Person, (b) the acquisition of in excess of 50% of the capital
stock, partnership interests, membership interests or equity of any Person
(other than a Person that is a Subsidiary), or otherwise causing any Person to
become a Subsidiary, or (c) a merger or consolidation or any other combination
with another Person (other than a Person that is a Subsidiary) provided that the
Borrower or the Subsidiary is the surviving entity.
"Adjusted LIBOR" is defined in Section 1.3(b) hereof.
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"Additional Lender" is defined in Section 1.15 hereof.
"Administrative Agent" means ▇▇▇▇▇▇ Trust and Savings Bank, and any
successor pursuant to Section 11.7 hereof.
"Administrative Agent's Quoted Rate" is defined in Section 1.6(c).
"Affiliate" means any Person directly or indirectly controlling or
controlled by, or under direct or indirect common control with, another Person.
A Person shall be deemed to control another Person for the purposes of this
definition if such Person possesses, directly or indirectly, the power to
direct, or cause the direction of, the management and policies of the other
Person, whether through the ownership of voting securities, common directors,
trustees or officers, by contract or otherwise; provided that, in any event for
purposes of this definition, any Person that owns, directly or indirectly, 5% or
more of the securities having the ordinary voting power for the election of
directors or governing body of a corporation or 5% or more of the partnership or
other ownership interest of any other Person (other than as a limited partner of
such other Person) will be deemed to control such corporation or other Person.
"Agreement" is defined in the preamble hereof.
"Applicable Margin" means, with respect to Loans, Reimbursement
Obligations, and the commitment fees and letter of credit fees payable under
Section 2.1 hereof, from the Closing Date through the first Pricing Date the
rate per annum specified below:
Applicable Margin for Base Rate Loans under the
Revolving Credit and Reimbursement Obligations: 0.0%
Applicable Margin for Eurodollar Loans under the
Revolving Credit: 2.00%
Applicable Margin for commitment fee: 0.35%
; provided, however, that the Applicable Margin shall be subject to quarterly
adjustments on the first Pricing Date, and thereafter from one Pricing Date to
the next the Applicable Margin means a rate per annum determined in accordance
with the following schedule:
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APPLICABLE MARGIN FOR BASE
RATE LOANS UNDER REVOLVING APPLICABLE MARGIN FOR
TOTAL FUNDED DEBT/ EBITDA CREDIT AND REIMBURSEMENT EURODOLLAR LOANS UNDER APPLICABLE MARGIN FOR
RATIO FOR SUCH PRICING DATE OBLIGATIONS SHALL BE: REVOLVING CREDIT SHALL BE: COMMITMENT FEE SHALL BE:
Less than or equal to 1.5 0.00% 1.75% 0.30%
to 1.0
Greater than 1.5 to 1.0, 0.00% 2.00% 0.35%
but less than or equal to
2.0 to 1.0
Greater than 2.0 to 1.0 0.25% 2.25% 0.45%
For purposes hereof, the term "Pricing Date" means, for any fiscal quarter of
the Parent ending on or after September 30, 2001, the date on which the
Administrative Agent is in receipt of the Parent's most recent financial
statements (and, in the case of the year-end financial statements, audit report)
for the fiscal quarter then ended, pursuant to Section 8.5 hereof. The
Applicable Margin shall be established based on the Total Funded Debt/EBITDA
Ratio for the most recently completed fiscal quarter and the Applicable Margin
established on a Pricing Date shall remain in effect until the next Pricing
Date. If the Borrower has not delivered the financial statements by the date
such financial statements (and, in the case of the year-end financial
statements, audit report) are required to be delivered under Section 8.5 hereof,
until such financial statements and audit report are delivered, the Applicable
Margin shall be the highest Applicable Margin (i.e., the Total Funded
Debt/EBITDA Ratio shall be deemed to be greater than 2.0 to 1.0). If the
Borrower subsequently delivers such financial statements before the next Pricing
Date, the Applicable Margin established by such late delivered financial
statements shall take effect from the date of delivery until the next Pricing
Date. In all other circumstances, the Applicable Margin established by such
financial statements shall be in effect from the Pricing Date that occurs
immediately after the end of the fiscal quarter covered by such financial
statements until the next Pricing Date. Each determination of the Applicable
Margin made by the Administrative Agent in accordance with the foregoing shall
be conclusive and binding on the Borrower and the Lenders absent manifest error.
"Application" is defined in Section 1.2(b) hereof.
"Association Agreements" means, collectively, the Trademark License
Agreement and the Mutual Support Agreement, each dated December 18, 1994,
between the Borrower and FTD Association, an Ohio non-profit corporation.
"Authorized Representative" means those persons shown on the list of
officers provided by the Borrower pursuant to Section 7.2 hereof or on any
update of any such list provided by the Borrower to the Administrative Agent, or
any further or different officers of the Borrower so named by any Authorized
Representative of the Borrower in a written notice to the Administrative Agent.
"Base Rate" is defined in Section 1.3(a) hereof.
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"Base Rate Loan" means a Loan bearing interest at a rate specified in
Section 1.3(a) hereof.
"Borrower" is defined in the introductory paragraph of this Agreement.
"Borrowing" means the total of Loans of a single type advanced,
continued for an additional Interest Period, or converted from a different type
into such type by the Lenders under a Credit on a single date and, in the case
of Eurodollar Loans, for a single Interest Period. Borrowings of Loans are made
and maintained ratably from each of the Lenders under a Credit according to
their Percentages of such Credit. A Borrowing is "advanced" on the day Lenders
advance funds comprising such Borrowing to the Borrower, is "continued" on the
date a new Interest Period for the same type of Loans commences for such
Borrowing, and is "converted" when such Borrowing is changed from one type of
Loans to the other, all as requested by the Borrower pursuant to Section 1.5(a)
hereof.
"Business Day" means any day (other than a Saturday or Sunday) on which
banks are not authorized or required to close in Chicago, Illinois and, if the
applicable Business Day relates to the advance or continuation of, or conversion
into, or payment of a Eurodollar Loan, on which banks are dealing in U.S. Dollar
deposits in the interbank eurodollar market in London, England.
"Capital Expenditures" means, with respect to any Person for any
period, the aggregate amount of all expenditures (whether paid in cash or
accrued as a liability) by such Person during that period during which, in
accordance with GAAP, are or should be included as "additions to property, plant
or equipment" or similar fixed asset accounts reflected in the statement of cash
flows of such Person, but excluding expenditures made in connection with the
replacement, substitution or restoration of assets to the extent financed (i)
from insurance proceeds (or other similar recoveries) paid on account of the
loss of or damage to the assets being replaced or restored, (ii) with awards of
compensation arising from the taking by eminent domain or condemnation of the
assets being replaced, or (iii) with credits for trade-ins of existing
equipment, fixed assets or improvements.
"Capital Lease" means any lease of Property which in accordance with
GAAP is required to be capitalized on the balance sheet of the lessee.
"Capitalized Lease Obligation" means, for any Person, the amount of the
liability shown on the balance sheet of such Person in respect of a Capital
Lease determined in accordance with GAAP.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended and in effect from time to time.
"Change of Control" means any of (a) the acquisition by any "person" or
"group" (as such terms are used in sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended), other than the Current Stockholders or any of
their Affiliates, at any time of beneficial ownership of a majority of the
outstanding capital stock of the Parent on a fully-diluted basis, (b) the
failure of individuals who are members of the board of directors of the Parent
on the
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Closing Date (together with any new or replacement directors whose initial
nomination for election was approved by a majority of the directors who were
either directors on the Closing Date or previously so approved) to constitute a
majority of the board of directors of the Parent, and (c) the failure of the
Parent to own 100% of the outstanding capital stock of the Borrower on a
fully-diluted basis.
"Closing Date" means the date of this Agreement or such later Business
Day upon which each condition described in Section 7.2 shall be satisfied or
waived in a manner acceptable to the Administrative Agent in its discretion.
"Code" means the Internal Revenue Code of 1986, as amended, and any
successor statute thereto.
"Collateral" means all properties, rights, interests and privileges
from time to time subject to the Liens granted to the Administrative Agent, or
any security trustee therefor, by the Collateral Documents.
"Collateral Account" is defined in Section 9.4 hereof.
"Collateral Documents" means the Mortgage, the Pledge Agreement, the
Security Agreement, and all other mortgages, deeds of trust, security
agreements, pledge agreements, assignments, financing statements and other
documents as shall from time to time secure or relate to the Obligations or any
part thereof.
"Commitments" means the Revolving Credit Commitments and the Swing Line
Commitment.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Parent, the Borrower or any other
Subsidiary, as relevant, are treated as a single employer under Section 414 of
the Code.
"Credit" means any of the Revolving Credit or the Swing Line.
"Credit Event" means the advancing of any Loan, the continuation of or
conversion into a Eurodollar Loan, or the issuance of, or extension of the
expiration date or increase in the amount of, any Letter of Credit.
"Current Stockholders" means Perry Principals, L.L.C., ▇▇▇▇ Capital,
Inc. and Fleet Growth Resources, Inc. or any Affiliate of any of such entities.
"Default" means any event or condition the occurrence of which would,
with the passage of time or the giving of notice, or both, constitute an Event
of Default.
"Designating Lender" is defined in Section 13.12 hereof.
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"Disposition" means the sale, lease, conveyance, or other disposition
of Property, other than sales or other dispositions expressly permitted under
Section 8.10(a), (b), (c), (d), (e), (g), (h) or (i) hereof.
"Disqualified Stock" means any capital stock that, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the option of the holder thereof, in whole or in part, on or prior to the
Termination Date.
"Domestic Subsidiary" means each Subsidiary which is not a Foreign
Subsidiary.
"EBITDA" means, with reference to any period, Net Income for such
period plus the sum of all amounts deducted in arriving at such Net Income
amount in respect of (a) Interest Expense for such period, (b) foreign, federal,
state and local income taxes for such period, and (c) depreciation expense
related to fixed assets and amortization expense including without limitation
with respect to goodwill and other intangible assets for such period, plus or
minus, as the case may be, extraordinary non-cash losses or gains, plus, with
respect to the fiscal quarter of the Parent ended June 30, 2001, $14,000,000
representing a non-recurring charge relating to the termination of the
Association Agreements; provided, however, that EBITDA for the relevant period
shall be calculated on a pro forma basis in good faith by the Parent and
established to the reasonable satisfaction of the Administrative Agent as if
each Permitted Acquisition which occurred during such period had taken place on
the first day of such period (including adjustments for non-recurring expenses
and income reasonably determined by the Parent in good faith and established to
the reasonable satisfaction of the Administrative Agent).
"Eligible Line of Business" means any business which is engaged in as
of the date of this Agreement by the Parent, the Borrower or any Subsidiary
existing as of the date of this Agreement and any other business activity which
the Administrative Agent determines is reasonably related thereto.
"Environmental Claim" means any investigation, notice, violation,
demand, allegation, action, suit, injunction, judgment, order, consent decree,
penalty, fine, lien, proceeding or claim (whether administrative, judicial or
private in nature) arising (a) pursuant to, or in connection with an actual or
alleged violation of, any Environmental Law, (b) in connection with any
Hazardous Material, (c) from any abatement, removal, remedial, corrective or
response action in connection with a Hazardous Material, Environmental Law or
order of a governmental authority, or (d) from any actual or alleged damage,
injury, threat or harm to health, safety, natural resources or the environment.
"Environmental Law" means any current or future Legal Requirement
pertaining to (a) the protection of health, safety and the indoor or outdoor
environment, (b) the conservation, management or use of natural resources and
wildlife, (c) the protection or use of surface water or groundwater, (d) the
management, manufacture, possession, presence, use, generation, transportation,
treatment, storage, disposal, release, threatened release, abatement, removal,
remediation or handling of, or exposure to, any Hazardous Material, or (e)
pollution (including
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any release to air, land, surface water or groundwater), and any amendment,
rule, regulation, order or directive issued thereunder.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor statute thereto.
"Eurodollar Loan" means a Loan bearing interest at the rate specified
in Section 1.3(b) hereof.
"Eurodollar Reserve Percentage" is defined in Section 1.3(b) hereof.
"Event of Default" means any event or condition identified as such in
Section 9.1 hereof.
"Event of Loss" means, with respect to any Property: (a) any loss,
destruction or damage of such Property or (b) any condemnation, seizure, or
taking, by exercise of the power of eminent domain or otherwise, of such
Property, or confiscation of such Property or the requisition of the use of such
Property.
"Existing Letters of Credit" is defined in Section 1.2(a) hereof.
"Federal Funds Rate" means the fluctuating interest rate per annum
described in part (x) of clause (ii) of the definition of Base Rate appearing in
Section 1.3(a) hereof.
"Fixed Charges" means, with reference to any period, the sum of (a) all
payments of principal on Indebtedness for Borrowed Money of the Parent and the
Subsidiaries paid or required to be paid during such period, plus (b) foreign,
federal, state and local income taxes of the Parent and the Subsidiaries paid or
required to be paid in cash during such period, plus (c) Interest Expense of the
Parent and the Subsidiaries paid or required to be paid in cash during period,
plus (d) Restricted Payments of the Parent and the Subsidiaries made in cash
during such period, provided that, the amounts of foreign, federal, state and
local income taxes set forth in clause (b) of this definition shall, for the
first three fiscal quarters following the Closing Date, be annualized by
multiplying: (i) the actual amount paid or required to be paid during the
quarter ending on September 30, 2001 by 4 for the period ending on September 30,
2001, (ii) the actual amount paid or required to be paid during the two quarters
ending on September 30, 2001 and December 31, 2001 by 2 for the period ending on
December 31, 2001, and (iii) the actual amount paid or required to be paid
during the three quarters ending September 30, 2001, December 31, 2001 and March
31, 2002 by 4/3 for the period ending March 31, 2002, and provided further that
the annualized amount of foreign, federal, state and local income taxes paid or
required to be paid for each of the three calculation periods described in the
immediately preceding proviso shall, in any event, be capped for the purposes of
calculating Fixed Charges for each of such calculation periods at 40% of the
actual pre-tax income of the Parent and the Subsidiaries for the four fiscal
quarters then ending.
"Fixed Rate Loan" means any Eurodollar Loan and (to the extent bearing
interest with reference to the Administrative Agent's Quoted Rate) any Swing
Loan.
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"Foreign Subsidiary" means each Subsidiary which (a) is organized under
the laws of a jurisdiction other than the United States of America or any state
thereof, (b) conducts substantially all of its business outside of the United
States of America and (c) has substantially all of its assets outside of the
United States of America.
"▇▇▇.▇▇▇" means ▇▇▇.▇▇▇ INC., a Delaware corporation.
"GAAP" means generally accepted accounting principles set forth from
time to time in the opinions and pronouncements of the Accounting Principles
Board and the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date of
determination.
"Guarantors" is defined in Section 12.1 hereof.
"Hazardous Material" means any substance, chemical, compound, product,
solid, gas, liquid, waste, byproduct, pollutant, contaminant or material which
is hazardous or toxic, and includes, without limitation, (a) asbestos,
polychlorinated biphenyls and petroleum (including crude oil or any fraction
thereof) and (b) any material classified or regulated as "hazardous" or "toxic"
or words of like import pursuant to an Environmental Law.
"Hazardous Material Activity" means any activity, event or occurrence
involving a Hazardous Material, including, without limitation, the manufacture,
possession, presence, use, generation, transportation, treatment, storage,
disposal, release, threatened release, abatement, removal, remediation, handling
of or corrective or response action to any Hazardous Material.
"Hedging Agreements" means the agreements from time to time entered
into by the Borrower or any Subsidiary evidencing Hedging Liability or otherwise
setting forth the terms and conditions applicable thereto, including without
limitation such agreements entered into pursuant to Section 8.25 hereof.
"Hedging Liability" means the liability of the Borrower or any
Subsidiary to any of the Lenders, or any Affiliates of such Lenders, in respect
of any interest rate swap agreements, interest rate cap agreements, interest
rate collar agreements, interest rate floor agreements, interest rate exchange
agreements, foreign currency contracts, currency swap contracts, or other
similar interest rate or currency hedging arrangements as the Borrower or such
Subsidiary, as the case may be, may from time to time enter into with any one or
more of the Lenders party to this Agreement or their Affiliates with prior
written notice to the Administrative Agent.
"Hostile Acquisition" means the acquisition of the capital stock or
other equity interests of a Person through a tender offer or similar
solicitation of the owners of such capital stock or other equity interests which
has not been approved (prior to such acquisition) by resolutions of the Board of
Directors of such Person or by similar action if such Person is not a
corporation, and as to which such approval has not been withdrawn.
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"Indebtedness for Borrowed Money" means for any Person (without
duplication) (i) all indebtedness of such Person for borrowed money, whether
current or funded, or secured or unsecured, (ii) all indebtedness for the
deferred purchase price of Property or services, (iii) all indebtedness created
or arising under any conditional sale or other title retention agreement with
respect to Property acquired by such Person (even though the rights and remedies
of the seller or lender under such agreement in the event of a default are
limited to repossession or sale of such Property), (iv) all indebtedness secured
by a purchase money mortgage or other Lien to secure all or part of the purchase
price of Property subject to such mortgage or Lien, (v) all obligations under
leases which shall have been or must be, in accordance with GAAP, recorded as
Capital Leases in respect of which such Person is liable as lessee, (vi) any
liability in respect of banker's acceptances or letters of credit, (vii) any
indebtedness, whether or not assumed, secured by Liens on Property acquired by
such Person at the time of acquisition thereof, (viii) all obligations under
leases which are, in accordance with GAAP, recorded as operating leases on the
financial statements of such Person but which are treated as indebtedness under
the Code (including without limitation obligations under so-called "synthetic
leases") and (ix) all indebtedness referred to in clause (i), (ii), (iii), (iv),
(v), (vi), (vii) or (viii) above which is directly or indirectly guaranteed by
such Person or which such Person has agreed (contingently or otherwise) to
purchase or otherwise acquire or in respect of which any of them have otherwise
assured a creditor against loss, it being understood that the term "Indebtedness
for Borrowed Money" shall not include trade payables arising in the ordinary
course of business.
"Intercompany Agreements" means the Intercompany Services Agreement,
dated August 19, 1999, between ▇▇▇.▇▇▇ and the Borrower, the Tax Sharing
Agreement, dated December 19, 1994 (as heretofore amended, restated,
supplemented or otherwise modified from time to time), between the Borrower,
▇▇▇.▇▇▇ and the Parent, the Registration Rights Agreement, dated May 19, 1999,
between ▇▇▇.▇▇▇ and the Borrower, the Trademark License Agreement, dated October
1, 1999, between ▇▇▇.▇▇▇ and the Borrower, the Intercompany Indemnification
Agreement, dated October 1, 1999, among ▇▇▇.▇▇▇, the Borrower and the Parent,
the Florists Online Hosting Agreement, dated October 1, 1999, between ▇▇▇.▇▇▇
and the Borrower, and the Commission Agreement, dated October 1, 1999, between
▇▇▇.▇▇▇ and the Borrower.
"Interest Expense" means, with reference to any period, the sum of all
interest charges (including imputed interest charges with respect to Capitalized
Lease Obligations and all amortization of debt discount and expense) of the
Parent and the Subsidiaries for such period determined on a consolidated basis
in accordance with GAAP.
"Interest Period" is defined in Section 1.7 hereof.
"L/C Issuer" means ▇▇▇▇▇▇ Trust and Savings Bank and each other Lender
which, at the Borrower's request and with such Lender's and the Administrative
Agent's consent, agrees to issue Letters of Credit pursuant to Section 1.2
hereof in such capacity as an issuer of Letters of Credit, and, with respect to
a particular Letter of Credit, refers to the Lender which issued such Letter of
Credit.
"L/C Obligations" means the aggregate undrawn face amounts of all
outstanding Letters of Credit and all unpaid Reimbursement Obligations.
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"L/C Sublimit" means $15,000,000, as reduced pursuant to the terms
hereof.
"Legal Requirement" means any treaty, convention, statute, law,
regulation, ordinance, license, permit, governmental approval, injunction,
judgment, order, consent decree or other requirement of any governmental
authority, whether federal, state, or local.
"Lenders" means and includes ▇▇▇▇▇▇ Trust and Savings Bank and the
other financial institutions from time to time party to this Agreement,
including each assignee Lender pursuant to Section 13.12 hereof.
"Lending Office" is defined in Section 10.4 hereof.
"Letter of Credit" is defined in Section 1.2(a) hereof.
"LIBOR" is defined in Section 1.3(b) hereof.
"Lien" means any mortgage, lien, security interest, pledge, charge or
encumbrance of any kind in respect of any Property, including the interests of a
vendor or lessor under any conditional sale, Capital Lease or other title
retention arrangement.
"Loan" means and includes Revolving Loans and Swing Loans, and each of
them singly and the term "type" of Loan refers to its status as a Revolving Loan
or Swing Loan, or, if a Revolving Loan, its status as a Base Rate Loan or
Eurodollar Loan or, if a Swing Loan, its status as a Base Rate Loan or a loan
bearing interest equal to the Administrative Agent's Quoted Rate.
"Loan Documents" means this Agreement, the Notes, the Applications, the
Collateral Documents, the Hedging Agreements, and each other instrument or
document to be delivered hereunder or thereunder or otherwise in connection
therewith.
"Management Consulting Services Agreement" is defined in Section 8.12
hereof.
"Material Adverse Effect" means (a) a material adverse change in, or
material adverse effect upon, the operations, business, Property, condition
(financial or otherwise) or prospects of the Borrower or of the Borrower, the
Parent and the Subsidiaries taken as a whole, (b) a material impairment of the
ability of the Borrower, the Parent or any Subsidiary to perform its material
obligations under any Loan Document, or (c) a material adverse effect upon (i)
the legality, validity, binding effect or enforceability against the Borrower,
the Parent or any Subsidiary of any Loan Document or the rights and remedies of
the Administrative Agent and the Lenders thereunder or (ii) the perfection or
priority of any material Lien granted under any Collateral Document.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Mortgage" means that certain Mortgage and Security Agreement with
Assignment of Rents dated as of the date of this Agreement between the Borrower
and the Administrative Agent
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relating to the Borrower's real property located in Downers Grove, Illinois, as
the same may be amended, modified, supplemented or restated from time to time.
"Net Cash Proceeds" means, as applicable, (a) with respect to any
Disposition by a Person, cash and cash equivalent proceeds received by or for
such Person's account, net of (i) reasonable direct costs, fees and expenses
relating to such Disposition and (ii) sale, use or other transactional taxes
paid or payable by such Person as a direct result of such Disposition; (b) with
respect to any Event of Loss of a Person, cash and cash equivalent proceeds
received by or for such Person's account (whether as a result of payments made
under any applicable insurance policy therefor or in connection with
condemnation proceedings or otherwise), net of reasonable direct costs, fees and
expenses incurred in connection with the collection of such proceeds, awards or
other payments; and (c) with respect to any offering of equity securities of a
Person or the issuance of any Indebtedness for Borrowed Money by a Person, cash
and cash equivalent proceeds received by or for such Person's account, net of
reasonable legal, underwriting, and other costs, fees and expenses incurred as a
direct result thereof.
"Net Income" means, with reference to any period, the net income (or
net loss) of the Parent and the Subsidiaries for such period computed on a
consolidated basis in accordance with GAAP; provided that there shall be
excluded from Net Income (a) the net income (or net loss) of any Person accrued
prior to the date it becomes a Subsidiary, or has merged into or consolidated
with, the Parent, the Borrower or another Subsidiary, and (b) the net income (or
net loss) of any Person (other than a Subsidiary) in which the Parent, the
Borrower or any Subsidiary has a equity interest in, except to the extent of the
amount of dividends or other distributions actually paid to the Parent, the
Borrower or any Subsidiary during such period.
"Net Worth" means, for any Person and at any time the same is to be
determined, total shareholder's equity (including capital stock, additional
paid-in capital and retained earnings after deducting treasury stock) which
would appear on the balance sheet of such Person in accordance with GAAP.
"Notes" means and includes the Revolving Notes and the Swing Line Note.
"Obligations" means all obligations of the Borrower to pay principal
and interest on the Loans, all Reimbursement Obligations owing under the
Applications, all fees and charges payable hereunder, all Hedging Liability, and
all other payment obligations of the Parent, the Borrower or any Subsidiary
arising under or in relation to any Loan Document, in each case whether now
existing or hereafter arising, due or to become due, direct or indirect,
absolute or contingent, and howsoever evidenced, held or acquired.
"Parent" is defined in the introductory paragraph of this Agreement.
"Participating Interest" is defined in Section 1.2(d) hereof.
"Participating Lender" is defined in Section 1.2(d) hereof.
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"PBGC" means the Pension Benefit Guaranty Corporation or any Person
succeeding to any or all of its functions under ERISA.
"Percentage" means for any Lender its Revolver Percentage.
"Permitted Acquisition" means (a) any Acquisition consented to in
writing by the Required Lenders, or (b) any other Acquisition with respect to
which all of the following conditions shall have been satisfied:
(i) the Acquired Business is in an Eligible Line of
Business and has its primary operations within the United States;
(ii) the Acquisition shall not be a Hostile Acquisition;
(iii) the financial statements of the Acquired Business
shall have been audited by one of the "Big Five" accounting firms or by
another independent accounting firm of national or regional repute or
otherwise reasonably satisfactory to the Administrative Agent, or if
such financial statements have not been audited by such an accounting
firm, (x) such financial statements shall have been approved by the
Administrative Agent and (y) the Acquired Business has undergone a
successful so-called businessman's review by an accounting firm
reasonably satisfactory to the Administrative Agent as part of the
Parent's and the Borrower's due diligence on the Acquisition, and the
Administrative Agent is satisfied with any other due diligence
conducted with respect to the Acquisition;
(iv) the Total Consideration for the Acquired Business
shall not exceed $10,000,000, and when taken together with the Total
Consideration for all Acquired Businesses acquired during the period
after the Closing Date, shall not exceed $30,000,000;
(v) the Borrower shall have notified the Administrative
Agent and Lenders not less than 20 days prior to any such Acquisition
and furnished to the Administrative Agent and Lenders at such time
reasonable details as to such Acquisition (including sources and uses
of funds therefor), and 3-year historical financial information and
3-year pro forma financial forecasts of the Acquired Business on a
stand alone basis as well as of the Parent on a consolidated basis
after giving effect to the Acquisition (with any projected cost savings
in such pro forma financial forecasts being satisfactory to the
Administrative Agent) and covenant compliance calculations reasonably
satisfactory to the Administrative Agent, and such historical and pro
forma financial information shows the Total Funded Debt/EBITDA Ratio
(computed on a pro forma basis after giving effect to the Acquisition)
to be 0.25 or more below the maximum permitted level pursuant to
Section 8.22 hereof after giving effect to such Acquisition;
(vi) if a new Subsidiary is formed or acquired as a result
of or in connection with the Acquisition, the Borrower will have
complied with the requirements of Sections 4 and 8.17 hereof in
connection therewith; and
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(vii) after giving effect to the Acquisition, no Default or
Event of Default shall exist, including with respect to the covenants
contained in Sections 8.22, 8.23, and 8.24 on a pro forma basis.
"Permitted Existing Indebtedness" means the indebtedness of the Parent
and the Subsidiaries identified as such on Schedule 8.7 to this Agreement.
"Permitted Existing Investments" means the investments of the Borrower
and the Subsidiaries identified as such on Schedule 8.9 to this Agreement.
"Permitted Existing Liens" means the Liens on the assets of the Parent
and the Subsidiaries identified as such on Schedule 8.8 to this Agreement.
"Person" means an individual, partnership, corporation, limited
liability company, association, trust, unincorporated organization or any other
entity or organization, including a government or agency or political
subdivision thereof.
"Plan" means any employee pension benefit plan covered by Title IV of
ERISA or subject to the minimum funding standards under Section 412 of the Code
that is either (i) maintained by a member of the Controlled Group for employees
of a member of the Controlled Group or (ii) maintained pursuant to a collective
bargaining agreement or any other arrangement under which more than one employer
makes contributions and to which a member of the Controlled Group is then making
or accruing an obligation to make contributions or has within the preceding five
plan years made contributions.
"Pledge Agreement" means that certain Pledge Agreement dated as of the
date of this Agreement among the Borrower, the Parent, the Domestic Subsidiaries
and the Administrative Agent, as the same may be amended, modified, supplemented
or restated from time to time.
"Premises" means the real property owned or leased by the Borrower or
any Subsidiary, including without limitation the real property and improvements
thereon owned by the Borrower, or any Subsidiary subject to the Lien of any
Collateral Document.
"Property" means, as to any Person, all types of real, personal,
tangible, intangible or mixed property owned by such Person whether or not
included in the most recent balance sheet of such Person and its subsidiaries
under GAAP.
"RCRA" means the Resource Conservation and Recovery Act of 1976, as
amended and in effect from time to time.
"Reimbursement Obligation" is defined in Section 1.2(c) hereof.
"Renaissance" is defined in Section 4.3 hereof.
"Required Lenders" means, as of the date of determination thereof,
Lenders whose outstanding Loans and interests in Letters of Credit and Unused
Revolving Credit Commitments
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constitute more than 66-2/3% of the sum of the total outstanding Loans,
interests in Letters of Credit, and Unused Revolving Credit Commitments of the
Lenders.
"Restricted Payments" is defined in Section 8.12 hereof.
"Revolver Percentage" means, for each Lender, the percentage of the
Revolving Credit Commitments represented by such Lender's Revolving Credit
Commitment or, if the Revolving Credit Commitments have been terminated, the
percentage held by such Lender (including through participation interests in
Reimbursement Obligations) of the aggregate principal amount of all Revolving
Loans and L/C Obligations then outstanding.
"Revolving Credit" means the credit facility for making Revolving Loans
and issuing Letters of Credit described in Sections 1.1 and 1.2 hereof.
"Revolving Credit Commitment" means, as to any Lender, the obligation
of such Lender to make Revolving Loans and to participate in Letters of Credit
issued for the account of the Borrower hereunder in an aggregate principal or
face amount at any one time outstanding not to exceed the amount set forth
opposite such Lender's name on Schedule 1 attached hereto and made a part
hereof, as the same may be reduced or modified at any time or from time to time
pursuant to the terms hereof. The Borrower and the Lenders acknowledge and agree
that the Revolving Credit Commitments of the Lenders aggregate $80,000,000 on
the date hereof.
"Revolving Loan" is defined in Section 1.1 hereof and, as so defined,
includes a Base Rate Loan or a Eurodollar Loan, each of which is a "type" of
Revolving Loan hereunder.
"Revolving Note" is defined in Section 1.11 hereof.
"S&P" means Standard & Poor's Credit Market Services, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"SPV" is defined in Section 13.12 hereof.
"Security Agreement" means that certain Security Agreement dated as of
the date of this Agreement among the Borrower, the Parent, the Domestic
Subsidiaries and the Administrative Agent, as the same may be amended, modified,
supplemented or restated from time to time.
"Subordinated Debt" means Indebtedness for Borrowed Money of the
Parent, the Borrower or any Subsidiary owing to any Person on terms and
conditions, and in such amounts, acceptable to the Administrative Agent and
which is subordinated in right of payment to the prior payment in full of the
Obligations pursuant to written subordination provisions approved in writing by
the Administrative Agent.
"subsidiary" means, as to any particular parent corporation or
organization, any other corporation or organization more than 50% of the
outstanding Voting Stock of which is at the time directly or indirectly owned by
such parent corporation or organization or by any one or more other entities
which are themselves subsidiaries of such parent corporation or organization.
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The term "Subsidiary" means a direct or indirect subsidiary of the Parent or of
the Borrower or of any of their direct or indirect Subsidiaries, and the term
"Subsidiaries" means all of such entities collectively, including without
limitation the Borrower, provided, however, that unless otherwise expressly
indicated, the term "Subsidiary" as used herein or in any Loan Document shall
NOT include ▇▇▇.▇▇▇.
"Swing Line" means the credit facility for making a Swing Loan
described in Section 1.6 hereof.
"Swing Line Note" is defined in Section 1.11 hereof.
"Swing Line Commitment" is defined in Section 1.6(a) hereof.
"Swing Loan" is defined in Section 1.6(a) hereof.
"Termination Date" means December 31, 2004, or such earlier date on
which the Revolving Credit Commitments are terminated in whole pursuant to
Section 1.13, 9.2 or 9.3 hereof.
"Total Consideration" means the total amount (but without duplication)
of (a) cash paid in connection with any Acquisition, plus (b) indebtedness
payable to the seller in connection with such Acquisition, plus (c) the fair
market value of any equity securities, including any warrants or options
therefor, delivered in connection with any Acquisition, plus (d) the present
value of covenants not to compete entered into in connection with such
Acquisition or other future payments which are required to be made over a period
of time and are not contingent upon the Borrower or any Subsidiary meeting
financial performance objectives (exclusive of salaries paid in the ordinary
course of business) (discounted at the Base Rate), but only to the extent not
included in clause (a), (b) or (c) above, plus (e) the amount of indebtedness
assumed in connection with such Acquisition.
"Total Funded Debt" means, at any time the same is to be determined,
the aggregate of all Indebtedness for Borrowed Money of the Parent and the
Subsidiaries at such time, including all Indebtedness for Borrowed Money of any
other Person which is directly or indirectly guaranteed by the Parent or any of
the Subsidiaries or which the Parent or any of the Subsidiaries has agreed
(contingently or otherwise) to purchase or otherwise acquire or in respect of
which the Parent or any of the Subsidiaries has otherwise assured a creditor
against loss.
"Total Funded Debt/EBITDA Ratio" means, as of the last day of any
fiscal quarter of the Parent, the ratio of Total Funded Debt as of the last day
of such fiscal quarter to EBITDA of the Parent and the Subsidiaries for the
period of four fiscal quarters then ended.
"Unfunded Vested Liabilities" means, for any Plan at any time, the
amount (if any) by which the present value of all vested nonforfeitable accrued
benefits under such Plan exceeds the fair market value of all Plan assets
allocable to such benefits, all determined as of the then most recent valuation
date for such Plan, but only to the extent that such excess represents a
potential liability of a member of the Controlled Group to the PBGC or the Plan
under Title IV of ERISA.
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"U.S. Dollars" and "$" each means the lawful currency of the United
States of America.
"Unused Revolving Credit Commitments" means, at any time, the
difference between the Revolving Credit Commitments then in effect and the
aggregate outstanding principal amount of Revolving Loans and L/C Obligations,
provided that Swing Loans outstanding from time to time shall be deemed to
reduce only the Unused Revolving Credit Commitment of the Administrative Agent
for purposes of computing the commitment fee under Section 2.1(a) hereof.
"Voting Stock" of any Person means capital stock or other equity
interests of any class or classes (however designated) having ordinary power for
the election of directors or other similar governing body of such Person, other
than stock or other equity interests having such power only by reason of the
happening of a contingency.
"Welfare Plan" means a "welfare plan" as defined in Section 3(1) of
ERISA.
"Wholly-owned Subsidiary" means a Subsidiary of which all of the issued
and outstanding shares of capital stock (other than directors' qualifying shares
as required by law) or other equity interests are owned by the Parent, the
Borrower and/or one or more Wholly-owned Subsidiaries within the meaning of this
definition.
Section 5.2. Interpretation. The foregoing definitions are equally
applicable to both the singular and plural forms of the terms defined. The words
"hereof", "herein", and "hereunder" and words of like import when used in this
Agreement shall refer to this Agreement as a whole and not to any particular
provision of this Agreement. All references to time of day herein are references
to Chicago, Illinois, time unless otherwise specifically provided. Where the
character or amount of any asset or liability or item of income or expense is
required to be determined or any consolidation or other accounting computation
is required to be made for the purposes of this Agreement, it shall be done in
accordance with GAAP except where such principles are inconsistent with the
specific provisions of this Agreement.
Section 5.3. Change in Accounting Principles. If, after the date of
this Agreement, there shall occur any change in GAAP from those used in the
preparation of the financial statements referred to in Section 6.5 hereof and
such change shall result in a change in the method of calculation of any
financial covenant, standard or term found in this Agreement, either the
Borrower or the Required Lenders may by notice to the Lenders and the Borrower,
respectively, require that the Lenders and the Borrower negotiate in good faith
to amend such covenants, standards, and term so as equitably to reflect such
change in accounting principles, with the desired result being that the criteria
for evaluating the financial condition of the Parent, the Borrower and the
Subsidiaries shall be the same as if such change had not been made. No delay by
the Borrower or the Required Lenders in requiring such negotiation shall limit
their right to so require such a negotiation at any time after such a change in
accounting principles. Until any such covenant, standard, or term is amended in
accordance with this Section 5.3, financial covenants shall be computed and
determined in accordance with GAAP in effect prior to such change in accounting
principles. Without limiting the generality of the foregoing, the Borrower shall
neither be deemed to be in compliance with any financial covenant hereunder nor
out of
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compliance with any financial covenant hereunder if such state of compliance or
noncompliance, as the case may be, would not exist but for the occurrence of a
change in accounting principles after the date hereof.
SECTION 6. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to the Administrative Agent and
the Lenders as follows:
Section 6.1. Organization and Qualification. Each of the Parent and the
Borrower is duly organized, validly existing and in good standing as a
corporation under the laws of the state of its incorporation, has full and
adequate power to own its Property and conduct its business as now conducted,
and is duly licensed or qualified and in good standing in each jurisdiction in
which the nature of the business conducted by it or the nature of the Property
owned or leased by it requires such licensing or qualifying, except where the
failure to do so would not have a Material Adverse Effect.
Section 6.2. Subsidiaries. Each Subsidiary and ▇▇▇.▇▇▇ is duly
organized, validly existing and in good standing under the laws of the
jurisdiction in which it is incorporated or organized, as the case may be, has
full and adequate power to own its Property and conduct its business as now
conducted, and is duly licensed or qualified and in good standing in each
jurisdiction in which the nature of the business conducted by it or the nature
of the Property owned or leased by it requires such licensing or qualifying,
except where the failure to do so would not have a Material Adverse Effect.
Schedule 6.2 hereto identifies each Subsidiary and ▇▇▇.▇▇▇, the jurisdiction of
its incorporation or organization, as the case may be, the percentage of issued
and outstanding shares of each class of its capital stock or other equity
interests owned by the Parent, the Borrower and the other Subsidiaries and
▇▇▇.▇▇▇ and, if such percentage is not 100% (excluding directors' qualifying
shares as required by law), a description of each class of its authorized
capital stock and other equity interests and the number of shares of each class
issued and outstanding as of the Closing Date. All of the outstanding shares of
capital stock and other equity interests of each Subsidiary and ▇▇▇.▇▇▇ are
validly issued and outstanding and fully paid and nonassessable and all such
shares and other equity interests indicated on Schedule 6.2 as owned by the
Parent, the Borrower, another Subsidiary or ▇▇▇.▇▇▇ are owned, beneficially and
of record, by the Parent, the Borrower, such Subsidiary or ▇▇▇.▇▇▇ free and
clear of all Liens other than the Liens granted in favor of the Administrative
Agent pursuant to the Collateral Documents. There are no outstanding commitments
or other obligations of any Subsidiary to issue, and no options, warrants or
other rights of any Person to acquire, any shares of any class of capital stock
or other equity interests of any Subsidiary.
Section 6.3. Authority and Validity of Obligations. The Borrower has
full right and authority to enter into this Agreement and the other Loan
Documents executed by it, to make the borrowings herein provided for, to issue
its Notes in evidence thereof, to grant to the Administrative Agent the Liens
described in the Collateral Documents executed by the Borrower, and to perform
all of its obligations hereunder and under the other Loan Documents executed by
it. Each of the Parent and the Domestic Subsidiaries has full right and
authority to
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enter into the Loan Documents executed by it, to guarantee the Obligations, to
grant to the Administrative Agent the Liens described in the Collateral
Documents executed by such Person, and to perform all of its obligations under
the Loan Documents executed by it. The Loan Documents to which the Parent, the
Borrower or any other Subsidiary is a party have been duly authorized, executed
and delivered by such Person and constitute valid and binding obligations of
such Person enforceable against it in accordance with their terms, except as
enforceability may be limited by bankruptcy, insolvency, fraudulent conveyance
or similar laws affecting creditors' rights generally and general principles of
equity (regardless of whether the application of such principles is considered
in a proceeding in equity or at law); and this Agreement and the other Loan
Documents do not, nor does the performance or observance by the Parent, the
Borrower or any other Subsidiary of any of the matters and things herein or
therein provided for, (a) contravene or constitute a material default under any
provision of law or any judgment, injunction, order or decree binding upon the
Parent, the Borrower or any other Subsidiary or any provision of the charter,
articles or certificate of incorporation or by-laws, articles of association or
operating agreement, partnership agreement, or other constituent document of the
Parent, the Borrower or any other Subsidiary, (b) contravene or constitute a
default under any covenant, indenture or agreement of or affecting the Parent,
the Borrower or any other Subsidiary or any of their Property, in each case
where such contravention or default, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect, or (c) result in the
creation or imposition of any Lien on any Property of the Parent, the Borrower
or any other Subsidiary other than the Liens granted in favor of the
Administrative Agent pursuant to the Collateral Documents.
Section 6.4. Use of Proceeds; Margin Stock. The Borrower shall use the
proceeds of the Revolving Credit for its general working capital purposes and
for such other legal and proper purposes as are consistent with all applicable
laws. Neither the Borrower nor any Subsidiary is engaged in the business of
extending credit for the purpose of purchasing or carrying margin stock (within
the meaning of Regulation U of the Board of Governors of the Federal Reserve
System), and no part of the proceeds of any Loan or any other extension of
credit made hereunder will be used to purchase or carry any such margin stock or
to extend credit to others for the purpose of purchasing or carrying any such
margin stock.
Section 6.5. Financial Reports. The consolidated balance sheet of the
Parent and its subsidiaries and ▇▇▇.▇▇▇ as at June 30, 2001, and the related
consolidated statements of income, retained earnings and cash flows of the
Parent and its subsidiaries and ▇▇▇.▇▇▇ for the fiscal year then ended, and
accompanying notes thereto, which financial statements are accompanied by the
audit report of KPMG LLP, independent public accountants, heretofore furnished
to the Administrative Agent and the Lenders, fairly present the consolidated
financial condition of the Parent and its subsidiaries and ▇▇▇.▇▇▇ as at said
dates and the consolidated results of their operations and cash flows for the
periods then ended in conformity with GAAP applied on a consistent basis. The
balance sheet of ▇▇▇.▇▇▇ as at June 30, 2001, and the related statements of
operations, retained earnings (deficit) and cash flows of ▇▇▇.▇▇▇ for the fiscal
year then ended, and accompanying notes thereto, which financial statements are
accompanied by the audit report of KPMG LLP, independent public accountants,
heretofore furnished to the Administrative Agent and the Lenders, fairly present
the financial condition of ▇▇▇.▇▇▇ as at said dates and the results of its
operations and cash flows for the periods then
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ended in conformity with GAAP applied on a consistent basis. Neither the Parent,
the Borrower, any other subsidiary of the Parent nor ▇▇▇.▇▇▇ has contingent
liabilities which are material to it other than as indicated on such financial
statements or, with respect to future periods, on the financial statements
furnished pursuant to Section 8.5 hereof.
Section 6.6. No Material Adverse Change. Since June 30, 2001, there has
been no change in the condition (financial or otherwise) or business prospects
of the Parent, the Borrower or any other Subsidiary which would have or
constitute a Material Adverse Effect.
Section 6.7. Full Disclosure. The statements and written information
furnished to the Administrative Agent and the Lenders in connection with the
negotiation of this Agreement and the other Loan Documents and the commitments
by the Lenders to provide all or part of the financing contemplated hereby do
not contain any untrue statements of a material fact or omit a material fact
necessary to make the material statements contained herein or therein not
misleading, the Administrative Agent and the Lenders acknowledging that as to
any projections furnished to the Administrative Agent and the Lenders, the
Parent and the Borrower only represent that the same were prepared on the basis
of information and estimates the Parent and the Borrower believed to be
reasonable.
Section 6.8. Trademarks, Franchises, and Licenses. The Borrower, and
the Subsidiaries own, possess, or have the right to use all material patents,
licenses, franchises, trademarks, trade names, copyrights, trade secrets, know
how and confidential commercial and proprietary information necessary to conduct
their businesses as now conducted, without known conflict with any such patent,
license, franchise, trademark, trade name, copyright or other proprietary right
of any other Person.
Section 6.9. Governmental Authority and Licensing. The Borrower, and
the Subsidiaries have received all licenses, permits, and approvals of all
Federal, state, local, and foreign governmental authorities, if any, necessary
to conduct their businesses, in each case where the failure to obtain or
maintain the same could reasonably be expected to have a Material Adverse
Effect. No investigation or proceeding which, if adversely determined, could
reasonably be expected to result in revocation or denial of any material
license, permit, or approval is pending or, to the knowledge of the Borrower,
threatened.
Section 6.10. Good Title. The Parent, the Borrower, and the other
Subsidiaries and ▇▇▇.▇▇▇ have good and defensible title (or valid leasehold
interests) to their material assets as reflected on the most recent consolidated
balance sheet of the Parent and the Subsidiaries and ▇▇▇.▇▇▇ furnished to the
Administrative Agent and the Lenders (except for sales of assets in the ordinary
course of business), subject to no Liens in the case of the Parent, the Borrower
and the Subsidiaries and ▇▇▇.▇▇▇ other than such thereof as are permitted by
Section 8.8 hereof.
Section 6.11. Litigation and Other Controversies. There is no
litigation or governmental proceeding or labor controversy pending, nor to the
knowledge of the Parent or the Borrower threatened, against the Parent, the
Borrower or any Subsidiary which if adversely determined could reasonably be
expected to have a Material Adverse Effect.
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Section 6.12. Taxes. All material tax returns required to be filed by
the Parent, the Borrower or any other Subsidiary in any jurisdiction have, in
fact, been filed, and all material taxes, assessments, fees and other
governmental charges upon the Parent, the Borrower or any Subsidiary or upon any
of their respective Properties, income or franchises, which are shown to be due
and payable in such returns, have been paid, except such taxes, assessments,
fees and governmental charges, if any, as are being contested in good faith and
by appropriate proceedings which prevent enforcement of the matter under contest
and as to which adequate reserves established in accordance with GAAP have been
provided. The Parent and the Borrower have no knowledge of any proposed material
additional tax assessment against the Parent, the Borrower or any Subsidiary for
which adequate provisions in accordance with GAAP have not been made on their
accounts. Adequate provisions in accordance with GAAP for taxes on the books of
the Parent, the Borrower and each Subsidiary have been made for all open years,
and for the current fiscal period.
Section 6.13. Approvals. No authorization, consent, license, or
exemption from, or filing or registration with, any court or governmental
department, agency or instrumentality, nor any approval or consent of the
stockholders of the Parent, the Borrower or any Subsidiary, or any other Person,
is or will be necessary to the valid execution, delivery or performance by the
Parent, the Borrower or any other Subsidiary of any Loan Document, except for
such approvals which (a) have been obtained prior to the date of this Agreement
and remain in full force and effect or (b) the failure of which to obtain would
not have a Material Adverse Effect.
Section 6.14. Affiliate Transactions. Neither the Borrower nor any
Subsidiary is a party to any material contracts or agreements with any of its
Affiliates on terms and conditions which, at the time such contracts or
agreements were entered into, were less favorable to the Borrower or such
Subsidiary than would have been usual and customary in similar contracts or
agreements entered into at such time between Persons not affiliated with each
other, except for the Intercompany Agreements. The Intercompany Agreements
previously furnished to the Administrative Agent and the Lenders represent true
and correct copies of all written agreements between the Borrower and ▇▇▇.▇▇▇ as
of the Closing Date.
Section 6.15. Investment Company; Public Utility Holding Company.
Neither the Borrower nor any Subsidiary is an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended, or a "public utility holding company" within
the meaning of the Public Utility Holding Company Act of 1935, as amended.
Section 6.16. ERISA. The Borrower, each Subsidiary, and each other
member of their respective Controlled Group, has fulfilled its obligations under
the minimum funding standards of and is in compliance in all material respects
with ERISA and the Code to the extent applicable to it and has not incurred any
liability to the PBGC or a Plan under Title IV of ERISA other than a liability
to the PBGC for premiums under Section 4007 of ERISA. Neither the Borrower nor
any Subsidiary has any material contingent liabilities with respect to any
post-retirement benefits under a Welfare Plan, other than liability for
continuation coverage described in article 6 of Title I of ERISA.
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Section 6.17. Compliance with Laws. (a) The Parent, the Borrower and the
Subsidiaries are in compliance with the requirements of all federal, state and
local laws, rules and regulations applicable to or pertaining to their
Properties or business operations (including, without limitation, the
Occupational Safety and Health Act of 1970, the Americans with Disabilities Act
of 1990, and laws and regulations establishing quality criteria and standards
for air, water, land and toxic or hazardous wastes and substances), where any
such non-compliance, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect. Neither the Parent, nor the
Borrower, nor any Subsidiary has received notice to the effect that its
operations are not in compliance with any of the requirements of applicable
federal, state or local environmental, health, and safety statutes and
regulations or is the subject of any governmental investigation evaluating
whether any remedial action is needed to respond to a release of any toxic or
hazardous waste or substance into the environment, where any such non-compliance
or remedial action, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
(b) Without limiting the representations and warranties set forth in
Section 6.17(a) above, except for such matters which could not reasonably be
expected to result in a Material Adverse Effect, the Borrower represents and
warrants that: (i) the Borrower and the Subsidiaries, and each of the Premises,
comply in all material respects with all applicable Environmental Laws; (ii) the
Borrower and the Subsidiaries have each obtained all material governmental
approvals required for their operations and each of the Premises by any
applicable Environmental Law; (iii) the Borrower has no knowledge of any
release, threatened release or disposal of any Hazardous Material at, on, or
about, any of the Premises in any material quantity and, to the knowledge of the
Borrower, none of the Premises are materially adversely affected by any release,
threatened release or disposal of a Hazardous Material originating or emanating
from any other property; (iv) to the knowledge of the Borrower, none of the
Premises contain or have contained any: (1) material amounts of asbestos
containing building material in material non-compliance with any Environmental
Law, (2) landfills or dumps, (3) hazardous waste treatment, storage or disposal
facility as defined pursuant to RCRA or any comparable state law, or (4) site on
or nominated for the National Priority List promulgated pursuant to CERCLA or
any state remedial priority list promulgated or published pursuant to any
comparable state law; (v) the Borrower and the Subsidiaries have not used a
material quantity of any Hazardous Material and have conducted no Hazardous
Material Activity at any of the Premises except in material compliance with
applicable Environmental Laws; (vi) the Borrower has no knowledge of any
material liability for response or corrective action, natural resource damage or
other harm pursuant to CERCLA, RCRA or any comparable state law; (vii) the
Borrower and the Subsidiaries have no notice or knowledge of and are not
required to give any notice of any Environmental Claim involving the Borrower or
any Subsidiary or any of the Premises, and the Borrower has no knowledge of any
conditions or occurrences at any of the Premises which could reasonably be
anticipated to form the basis for an Environmental Claim against the Borrower or
any Subsidiary or such Premises; (viii) none of the Premises are subject to any,
and the Borrower has no knowledge of any imminent, restriction on the ownership,
occupancy, use or transferability of the Premises in connection with any (1)
Environmental Law or (2) release, threatened release or disposal of a Hazardous
Material; and (ix) the Borrower has no knowledge of any conditions or
circumstances at any of the Premises which pose an unreasonable risk to the
environment or the health or safety of Persons.
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Section 6.18. Other Agreements. Neither the Parent, nor the Borrower,
nor any other Subsidiary is in default under the terms of any covenant,
indenture or agreement of or affecting such Person or any of its Property, which
default if uncured could reasonably be expected to have a Material Adverse
Effect.
Section 6.19. Solvency. The Parent, the Borrower and the Subsidiaries
are, individually and on a consolidated basis, solvent, able to pay their debts
as they become due, and have sufficient capital to carry on their business and
all businesses in which they are about to engage.
Section 6.20. No Default. No Default or Event of Default has occurred
and is continuing.
SECTION 7. CONDITIONS PRECEDENT.
The obligation of each Lender to advance, continue or convert any Loan
(other than the continuation of, or conversion into, a Base Rate Loan) or of the
L/C Issuer to issue, extend the expiration date (including by not giving notice
of non-renewal) of or increase the amount of any Letter of Credit under this
Agreement, shall be subject to the following conditions precedent:
Section 7.1. All Credit Events. At the time of each Credit Event
hereunder:
(a) each of the representations and warranties set forth
herein and in the other Loan Documents shall be and remain true and
correct as of said time, except to the extent the same expressly relate
to an earlier date;
(b) each of the Parent, the Borrower and each Subsidiary
shall be in compliance with all of the terms and conditions hereof and
of the other Loan Documents to which it is a party, and no Default or
Event of Default shall have occurred and be continuing or would occur
as a result of such Credit Event;
(c) in the case of a Borrowing the Administrative Agent shall
have received the notice required by Section 1.5 hereof, in the case of
the issuance of any Letter of Credit the L/C Issuer shall have received
a duly completed Application for such Letter of Credit together with
any fees called for by Section 2.1 hereof, and, in the case of an
extension or increase in the amount of a Letter of Credit, a written
request therefor in a form acceptable to the L/C Issuer together with
fees called for by Section 2.1 hereof; and
(d) such Credit Event shall not violate any order, judgment
or decree of any court or other authority or any provision of law or
regulation applicable to the Administrative Agent or any Lender
(including, without limitation, Regulation U of the Board of Governors
of the Federal Reserve System) as then in effect.
Each request for a Borrowing hereunder and each request for the
issuance of, increase in the amount of, or extension of the expiration date of,
a Letter of Credit shall be deemed to be a representation and warranty by the
Borrower on the date of such Credit Event as to the facts specified in
subsections (a) through (c), both inclusive, of this Section.
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Section 7.2. Initial Credit Event. Before or concurrently with the
initial Credit Event:
(a) the Administrative Agent shall have received for each
Lender this Agreement duly executed by the Borrower, the Parent, the
other Guarantors and the Lenders;
(b) the Administrative Agent shall have received for each
Lender such Lender's duly executed Notes of the Borrower dated the date
hereof and otherwise in compliance with the provisions of Section 1.11
hereof;
(c) the Administrative Agent shall have received the
Security Agreement and Pledge Agreement duly executed by the Parent,
the Borrower and each Domestic Subsidiary, and the Mortgage duly
executed by the Borrower, together with (i) original stock certificates
or other similar instruments or securities representing all of the
issued and outstanding shares of capital stock or other equity
interests of each Domestic Subsidiary and 65% of the issued and
outstanding shares of capital stock or other equity interests of each
Foreign Subsidiary which is owned by the Parent or a Domestic
Subsidiary as of the Closing Date, (ii) stock powers for the Collateral
described in the foregoing clause (i) executed in blank and undated,
and (iii) necessary UCC financing statements to be filed against the
Parent, the Borrower and each Domestic Subsidiary, as debtor, in favor
of the Administrative Agent, as secured party;
(d) the Administrative Agent shall have received evidence
of insurance required to be maintained under the Loan Documents, naming
the Administrative Agent as mortgagee and loss payee;
(e) the Administrative Agent shall have received for each
Lender copies of the Parent's, the Borrower's and each Domestic
Subsidiary's articles or certificate of incorporation and bylaws (or
comparable constituent documents) and any amendments thereto, certified
in each instance by its respective Secretary or Assistant Secretary;
(f) the Administrative Agent shall have received for each
Lender copies of resolutions of the Parent's, of the Borrower's and of
each Domestic Subsidiary's Board of Directors authorizing the
execution, delivery and performance of this Agreement and the other
Loan Documents to which it is a party and the consummation of the
transactions contemplated hereby and thereby, together with specimen
signatures of the persons authorized to execute such documents on the
Parent's, the Borrower's and each Domestic Subsidiary's behalf, all
certified in each instance by its respective Secretary or Assistant
Secretary;
(g) the Administrative Agent shall have received for each
Lender copies of the certificates of good standing for the Parent, the
Borrower and each Domestic Subsidiary (dated no earlier than 30 days
prior to the date hereof) from the office of the secretary of the state
of its incorporation or organization and of each state in which it is
qualified to do business as a foreign corporation or organization and
where failure to so qualify could reasonably be expected to have a
Material Adverse Effect;
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(h) the Administrative Agent shall have received for each
Lender a list of the Borrower's Authorized Representatives;
(i) the Administrative Agent shall have received for
itself and for the Lenders the initial fees called for by Section 2.1
hereof and such other closing or upfront fees as have been agreed upon
between the Administrative Agent and the Borrower;
(j) the Administrative Agent shall have received a
mortgagee's title insurance policy (or a prepaid binding commitment
therefor) in form and substance acceptable to the Administrative Agent
from a title insurance company acceptable to the Administrative Agent
in the aggregate amount of $11,000,000 insuring the Lien of the
Mortgage to be a valid first priority lien subject to no defects or
objections which are unacceptable to the Administrative Agent, together
with such endorsements as the Administrative Agent may require;
(k) the Administrative Agent shall have received a new
survey or an update to an existing survey in form and substance
acceptable to the Administrative Agent prepared by a licensed surveyor
on each parcel of real property subject to the Lien of the Mortgage
unless the title insurance policy described in clause (j) of this
Section insures over the absence of any such survey;
(l) the Administrative Agent shall have received a report
of an independent firm of environmental engineers acceptable to the
Administrative Agent concerning the environmental hazards and matters
with respect to the parcels of real property subject to the Lien of the
Mortgage, together with a reliance letter thereon acceptable to the
Administrative Agent;
(m) the Administrative Agent shall have received a Flood
Hazard Determination Form stating whether or not any portion of the
real property subject to the Lien of the Mortgage is in a federally
designated flood hazard area;
(n) each Lender shall have received such evaluations and
certifications as it may reasonably require (including a compliance
certificate in the form attached hereto as Exhibit E containing
compliance calculations of the financial covenants for the period
ending June 30, 2001) in order to satisfy itself as to the financial
condition of the Parent, the Borrower and the other Subsidiaries, and
the lack of material contingent liabilities of the Parent, the Borrower
and the other Subsidiaries;
(o) the Administrative Agent shall have received financing
statement, tax and judgment lien search results against the Property of
the Parent, the Borrower and each Domestic Subsidiary evidencing the
absence of Liens on its respective Properties except as permitted by
Section 8.8 hereof;
(p) the Administrative Agent shall have received pay-off
and lien release letters from secured creditors of the Parent, the
Borrower and each Domestic Subsidiary setting forth, among other
things, the total amount of indebtedness outstanding and owing
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to them (or outstanding letters of credit issued for the account of the
Parent, the Borrower or any Domestic Subsidiary) and containing an
undertaking to cause to be delivered to the Administrative Agent or an
authorization to permit the Administrative Agent to prepare and file
UCC termination statements and any other lien release instruments
necessary to release their Liens on the assets of the Parent, the
Borrower and each Domestic Subsidiary, which pay-off and lien release
letters shall be in form and substance acceptable to the Administrative
Agent;
(q) all obligations under the Credit Agreement dated as of
November 20, 1997, as amended, among the Borrower, the Parent, the
lenders party thereto and Bank One, NA (f/k/a The First National Bank
of Chicago), as agent, shall have been or shall be, concurrently with
the initial Credit Event, repaid and any commitments of the Lenders
thereunder shall have been cancelled;
(r) the Administrative Agent shall have received for each
Lender the favorable written opinion of counsel to the Parent, the
Borrower and each Domestic Subsidiary, in form and substance
satisfactory to the Administrative Agent; and
(s) the Administrative Agent shall have received for the
account of the Lenders such other agreements, instruments, documents,
certificates, and opinions as the Administrative Agent may reasonably
request.
SECTION 8. COVENANTS.
Each of the Borrower and, where and to the extent specifically
indicated, the Parent agrees that, so long as any credit is available to or in
use by the Borrower hereunder, except to the extent compliance in any case or
cases is waived in writing pursuant to the terms of Section 13.13 hereof:
Section 8.1. Maintenance of Business. Each of the Parent and the
Borrower shall, and shall cause each Subsidiary to, preserve and maintain its
existence, except as otherwise provided in Section 8.10(c) or 8.10(i) hereof.
The Borrower shall, and shall cause each Subsidiary to, preserve and keep in
force and effect all licenses, permits, franchises, approvals, patents,
trademarks, trade names, copyrights and other proprietary rights necessary to
the proper conduct of its business where the failure to do so could reasonably
be expected to have a Material Adverse Effect.
Section 8.2. Maintenance of Properties. The Borrower shall, and shall
cause each Subsidiary to, maintain, preserve and keep its property, plant and
equipment in good repair, working order and condition (ordinary wear and tear
excepted) and shall from time to time make all needful and proper repairs,
renewals, replacements, additions and betterments thereto so that at all times
the efficiency thereof shall be fully preserved and maintained, except to the
extent that, in the reasonable business judgment of such Person, any such
Property is no longer necessary for the proper conduct of the business of such
Person.
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Section 8.3. Taxes and Assessments. Each of the Parent and the Borrower
shall duly pay and discharge, and shall cause each Subsidiary to duly pay and
discharge, all taxes, rates, assessments, fees and governmental charges upon or
against it or its Properties, in each case before the same become delinquent and
before penalties accrue thereon, unless and to the extent that the same are
being contested in good faith and by appropriate proceedings which prevent
enforcement of the matter under contest and adequate reserves are provided
therefor.
Section 8.4. Insurance. The Borrower shall insure and keep insured, and
shall cause each Subsidiary to insure and keep insured, with good and
responsible insurance companies all insurable Property owned by it which is of a
character usually insured by Persons similarly situated and operating like
Properties against loss or damage from such hazards and risks, and in such
amounts, as are insured by Persons similarly situated and operating like
Properties; and the Borrower shall insure, and shall cause each Subsidiary to
insure, such other hazards and risks (including, without limitation, employers'
and public liability risks) with good and responsible insurance companies as and
to the extent usually insured by Persons similarly situated and conducting
similar businesses. The Borrower shall in any event maintain, and cause each
Domestic Subsidiary to maintain, insurance on the Collateral to the extent
required by the Collateral Documents. The Borrower shall, upon the request of
the Administrative Agent, furnish to the Administrative Agent and the Lenders a
certificate setting forth in summary form the nature and extent of the insurance
maintained pursuant to this Section.
Section 8.5. Financial Reports. Each of the Parent and the Borrower
shall, and shall cause each Subsidiary to, maintain a standard system of
accounting in accordance with GAAP and shall furnish to the Administrative
Agent, each Lender and each of their duly authorized representatives such
information respecting the business and financial condition of the Parent, the
Borrower and each Subsidiary (and, to the extent specifically required herein,
▇▇▇.▇▇▇) as the Administrative Agent or such Lender may reasonably request; and
without any request, shall furnish to the Administrative Agent and the Lenders:
(a) as soon as available, and in any event within 50 days
after the last day of each fiscal quarter of the Parent, a copy of
the consolidated balance sheet of the Parent and the Subsidiaries
and ▇▇▇.▇▇▇ as of the last day of such fiscal quarter and the
consolidated statements of income, retained earnings and cash flows
of the Parent and the Subsidiaries and ▇▇▇.▇▇▇ for the fiscal
quarter and for the fiscal year-to-date period then ended, each in
reasonable detail showing in comparative form the figures for the
corresponding date and period in the previous fiscal year, prepared
by the Parent in accordance with GAAP (subject to the absence of
footnote disclosures and year-end audit adjustments) and certified
by its chief financial officer or treasurer or another officer of
the Parent acceptable to the Administrative Agent;
(b) as soon as available, and in any event within 50 days
after the last day of each fiscal quarter of ▇▇▇.▇▇▇, a copy of the
balance sheet of ▇▇▇.▇▇▇ as of the last day of such fiscal quarter
and the statements of operations, retained earnings (deficit) and
cash flows of ▇▇▇.▇▇▇ for the fiscal quarter and for the fiscal
year-to-date period then ended, each in reasonable detail showing in
comparative form the figures for the corresponding date and period
in the previous fiscal year, prepared by the Parent in
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accordance with GAAP (subject to the absence of footnote disclosures
and year-end audit adjustments) and certified to by its chief
financial officer or treasurer or another officer of the Parent
acceptable to the Administrative Agent;
(c) as soon as available, and in any event within 50 days
after the last day of each fiscal quarter of the Parent, a copy of
the consolidated balance sheet of the Parent and the Subsidiaries as
of the last day of such fiscal quarter and the consolidated
statements of income, retained earnings and cash flows of the Parent
and the Subsidiaries for the fiscal quarter and for the fiscal
year-to-date period then ended, each in reasonable detail showing in
comparative form the figures for the corresponding date and period
in the previous fiscal year, prepared by the Parent in accordance
with GAAP (subject to the absence of footnote disclosures and
year-end audit adjustments) and certified to by its chief financial
officer or treasurer or another officer of the Parent acceptable to
the Administrative Agent;
(d) as soon as available, and in any event within 105 days
after the close of each fiscal year of the Parent, a copy of the
consolidated balance sheet of the Parent and the Subsidiaries and
▇▇▇.▇▇▇ as of the last day of the fiscal year then ended and the
consolidated statements of income, retained earnings and cash flows
of the Parent and the Subsidiaries and ▇▇▇.▇▇▇ for the fiscal year
then ended, and accompanying notes thereto, each in reasonable
detail showing in comparative form the figures for the previous
fiscal year, accompanied by an unqualified opinion of KPMG LLP or
another firm of independent public accountants of recognized
standing, selected by the Parent and reasonably satisfactory to the
Administrative Agent and the Required Lenders, to the effect that
the consolidated financial statements have been prepared in
accordance with GAAP and present fairly in accordance with GAAP the
consolidated financial condition of the Parent and the Subsidiaries
and ▇▇▇.▇▇▇ as of the close of such fiscal year and the results of
their operations and cash flows for the fiscal year then ended and
that an examination of such accounts in connection with such
financial statements has been made in accordance with generally
accepted auditing standards and, accordingly, such examination
included such tests of the accounting records and such other
auditing procedures as were considered necessary in the
circumstances;
(e) as soon as available, and in any event within 105 days
after the close of each fiscal year of ▇▇▇.▇▇▇, a copy of the
balance sheet of ▇▇▇.▇▇▇ as of the last day of the fiscal year then
ended and the statements of operations, retained earnings (deficit)
and cash flows of ▇▇▇.▇▇▇ for the fiscal year then ended, and
accompanying notes thereto, each in reasonable detail showing in
comparative form the figures for the previous fiscal year,
accompanied by an unqualified opinion of KPMG LLP or another firm of
independent public accountants of recognized standing, selected by
the Parent and reasonably satisfactory to the Administrative Agent
and the Required Lenders, to the effect that the financial
statements have been prepared in accordance with GAAP and present
fairly in accordance with GAAP the financial condition of ▇▇▇.▇▇▇ as
of the close of such fiscal year and the results of its operations
and cash flows for the fiscal year then ended and that an
examination of such accounts in connection with such financial
statements has been made in accordance with generally accepted
auditing standards and,
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accordingly, such examination included such tests of the accounting
records and such other auditing procedures as were considered
necessary in the circumstances;
(f) as soon as available, and in any event within 105 days
after the close of each fiscal year of the Parent, a copy of the
consolidated balance sheet of the Parent and the Subsidiaries as of
the last day of the fiscal year then ended and the consolidated
statements of income, retained earnings and cash flows of the Parent
and the Subsidiaries for the fiscal year then ended, and
accompanying notes thereto, each in reasonable detail showing in
comparative form the figures for the previous fiscal year, prepared
by the Parent in accordance with GAAP and certified to by its chief
financial officer or treasurer or another officer of the Parent
acceptable to the Administrative Agent;
(g) within the periods provided in subsection (d) and (e)
above, the written statement of the accountants who certified the
audit report thereby required that in the course of their audit they
have obtained no knowledge of any Default or Event of Default, or,
if such accountants have obtained knowledge of any such Default or
Event of Default, they shall disclose in such statement the nature
and period of the existence thereof;
(h) promptly after receipt thereof, any additional written
reports, management letters or other detailed information contained
in writing concerning significant aspects of the Parent's or any
Subsidiary's or ▇▇▇.▇▇▇'s operations and financial affairs given to
it by its independent public accountants;
(i) promptly after the sending or filing thereof, copies of
each financial statement, report, notice or proxy statement sent by
the Parent or any Subsidiary or ▇▇▇.▇▇▇ to its stockholders or other
equity holders, and copies of each regular, periodic or special
report, registration statement or prospectus (including all Form
10-K, Form 10-Q and Form 8-K reports) filed by the Parent or any
Subsidiary or ▇▇▇.▇▇▇ with any securities exchange or the Securities
and Exchange Commission or any successor agency;
(j) as soon as available, and in any event within 105 days
after the end of each fiscal year of the Parent, a copy of the
Parent's, the Borrower's and ▇▇▇.▇▇▇'s consolidated business plan
for the current fiscal year, such business plan to show the
Parent's, the Borrower's and ▇▇▇.▇▇▇'s projected consolidated
revenues, expenses and balance sheet on quarter-by-quarter basis,
such business plan to be in reasonable detail prepared by the Parent
and in form satisfactory to the Administrative Agent and the
Required Lenders (which shall include a summary of all assumptions
made in preparing such business plan);
(k) notice of any Change in Control;
(l) promptly after knowledge thereof shall have come to the
attention of any responsible officer of the Parent or the Borrower,
written notice of any threatened or pending litigation or
governmental proceeding or labor controversy against the Parent or
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any Subsidiary which, if adversely determined, could reasonably be
expected to have a Material Adverse Effect; and
(m) promptly after knowledge thereof shall have come to the
attention of any responsible officer of the Parent or the Borrower,
written notice of the occurrence of any Default or Event of Default
hereunder.
Each of the financial statements furnished to the Lenders pursuant to
subsections (a) and (c) of this Section 8.5 shall be accompanied by a written
certificate in the form attached hereto as Exhibit E signed by the chief
financial officer or treasurer of the Parent, or another officer of the Parent
acceptable to the Administrative Agent, to the effect that to the best of such
officer's knowledge and belief no Default or Event of Default has occurred
during the period covered by such statements or, if any such Default or Event of
Default has occurred during such period, setting forth a description of such
Default or Event of Default and specifying the action, if any, taken by the
Parent or any Subsidiary to remedy the same. Such certificate shall also set
forth the calculations supporting such statements in respect of Sections 8.22,
8.23, and 8.24 of this Agreement.
Section 8.6. Inspection. Each of the Parent and the Borrower shall, and
shall cause each Subsidiary to, permit the Administrative Agent, each Lender,
and each of their duly authorized representatives and agents to visit and
inspect any of its Property, corporate books and financial records, to examine
and make copies of its books of accounts and other financial records, and to
discuss its affairs, finances and accounts with, and to be advised as to the
same by, its officers, employees and independent public accountants (and by this
provision the Parent and the Borrower hereby authorize such accountants to
discuss with the Administrative Agent and such Lenders the finances and affairs
of the Parent, the Borrower and each Subsidiary) at such reasonable times and
intervals as the Administrative Agent or any such Lender may designate upon
reasonable prior notice.
Section 8.7. Borrowings and Guaranties. Neither the Parent nor the
Borrower shall, nor shall they permit any Subsidiary to, issue, incur, assume,
create or have outstanding any Indebtedness for Borrowed Money, or be or become
liable as endorser, guarantor, surety or otherwise for any debt, obligation or
undertaking of any other Person, or otherwise agree to provide funds for payment
of the obligations of another, or supply funds thereto or invest therein or
otherwise assure a creditor of another against loss, or apply for or become
liable to the issuer of a letter of credit which supports an obligation of
another, or subordinate any claim or demand it may have to the claim or demand
of any other Person; provided, however, that the foregoing shall not restrict
nor operate to prevent:
(a) the Obligations of the Parent, the Borrower and each
Domestic Subsidiary owing to the Administrative Agent and the
Lenders under the Loan Documents;
(b) purchase money indebtedness and Capitalized Lease
Obligations of the Parent and the Subsidiaries in an amount not to
exceed $5,000,000 in the aggregate at any one time outstanding;
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(c) obligations of the Parent, the Borrower or any Subsidiary
arising out of interest rate hedging agreements entered into with
financial institutions in the ordinary course of business
(including, without limitation, Hedging Agreements entered into with
the Lenders or their Affiliates);
(d) endorsement of items for deposit or collection of
commercial paper received in the ordinary course of business;
(e) indebtedness from time to time owing by the Parent to any
Subsidiary or by any Subsidiary to the Parent or any other
Subsidiary;
(f) the guarantee of the Obligations by the Guarantors in
favor of the Administrative Agent and the Lenders pursuant to
Section 12 hereof;
(g) Permitted Existing Indebtedness and any refinancings,
refundings, renewals or extensions thereof (which do not increase
the principal amount thereof);
(h) indebtedness with respect to surety, appeal and
performance bonds obtained by the Parent, the Borrower or any
Subsidiary in the ordinary course of business;
(i) indebtedness incurred by the Parent, the Borrower or any
Subsidiary to the seller in any Permitted Acquisition as part of the
consideration therefor or assumed in connection therewith; provided
that such indebtedness (x) of the Borrower and the Subsidiaries does
not exceed $10,000,000 in aggregate principal amount outstanding at
any time, and (y) of the Parent, the Borrower or any Subsidiary is
unsecured and is subordinated to the Obligations on terms reasonably
acceptable to the Administrative Agent;
(j) unsecured indebtedness of the Parent and the Subsidiaries
not otherwise permitted by this Section in an amount not to exceed
$5,000,000 in the aggregate at any one time outstanding, provided
that none of such indebtedness may be Indebtedness for Borrowed
Money of the type described in clause (viii) of the definition of
such term in Section 5.1 hereof;
(k) indebtedness consisting of advances of the type described
in Section 8.9(l); and
(l) indebtedness incurred by the Parent which is unsecured
and is subordinated to the Obligations on terms reasonably
acceptable to the Administrative Agent.
Section 8.8. Liens. Neither the Parent nor the Borrower shall, nor
shall they permit any Subsidiary to, create, incur or permit to exist any Lien
of any kind on any Property owned by any such Person; provided, however, that
the foregoing shall not apply to nor operate to prevent:
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(a) Liens arising by statute in connection with worker's
compensation, unemployment insurance, old age benefits, social
security obligations, taxes, assessments, statutory obligations,
governmental charges (including customs duties) or other similar
charges (other then Liens arising under ERISA), good faith cash
deposits in connection with tenders, contracts or leases to which
the Parent, the Borrower or any Subsidiary is a party or other cash
deposits required to be made in the ordinary course of business,
provided in each case that the obligation is not for borrowed money
and that the obligation secured is not overdue or, if overdue, is
being contested in good faith by appropriate proceedings which
prevent enforcement of the matter under contest and adequate
reserves have been established therefor;
(b) mechanics', workmen's, materialmen's, landlords',
carriers', or other similar Liens arising in the ordinary course of
business with respect to obligations which are not due or which are
being contested in good faith by appropriate proceedings which
prevent enforcement of the matter under contest;
(c) judgment liens and judicial attachment liens not
constituting an Event of Default under Section 9.1(g) hereof and the
pledge of assets for the purpose of securing an appeal, stay or
discharge in the course of any legal proceeding, provided that the
aggregate amount of liabilities of the Parent and the Subsidiaries
(including the Borrower) secured by a pledge of assets permitted
under this subsection, including interest and penalties thereon, if
any, shall not be in excess of $1,000,000 at any one time
outstanding;
(d)(i) Liens on property of the Parent, the Borrower or any
Subsidiary created solely for the purpose of securing indebtedness
permitted by Section 8.7(b) hereof, representing, or incurred to
finance, refinance or refund the purchase price of Property,
provided that no such Lien shall extend to or cover Property of the
Parent, the Borrower or such Subsidiary other than the respective
Property so acquired, and the principal amount of indebtedness
secured by any such Lien shall at no time exceed the original
purchase price of such Property, as reduced by repayments of
principal thereon, and (ii) Liens existing on any Property at the
time of the acquisition thereof by the Parent, the Borrower or any
Subsidiary and not created in contemplation of such acquisition;
(e) any interest or title of a lessor or sublessor under any
operating lease;
(f) easements, rights-of-way, restrictions and other similar
encumbrances against real property incurred in the ordinary course
of business which, in the aggregate, are not substantial in amount
and which do not materially detract from the value of the Property
subject thereto or materially interfere with the ordinary conduct of
the business of the Parent, the Borrower or any Subsidiary;
(g) the Liens granted in favor of the Administrative Agent
pursuant to the Collateral Documents;
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(h) Permitted Existing Liens and Liens securing indebtedness
replacing or renewing the indebtedness secured by Permitted Existing
Liens, provided that such Liens encumber the same Property
encumbered by the original Liens and no other Property and the
amount of indebtedness secured thereby does not increase; and
(i) leases or subleases on fixed assets or equipment granted
to third Persons not interfering in any material respect with the
business of the Parent or any Subsidiary.
Section 8.9. Investments, Acquisitions, Loans and Advances. The
Borrower shall not, nor shall it permit any Subsidiary to (and, with respect to
restrictions on investments of the type described in clause (j) of this Section
8.9 only, the Parent shall not) directly or indirectly, make, retain or have
outstanding any investments (whether through purchase of stock or obligations or
otherwise) in, or loans or advances to, any other Person, or acquire all or any
substantial part of the assets or business of any other Person or division
thereof; provided, however, that the foregoing shall not apply to nor operate to
prevent:
(a) investments in direct obligations of the United States of
America or of any agency or instrumentality thereof whose
obligations constitute full faith and credit obligations of the
United States of America, provided that any such obligations shall
mature within one year of the date of issuance thereof;
(b) investments in commercial paper rated at least P-1 by
▇▇▇▇▇'▇ and at least A-1 by S&P maturing within one year of the date
of issuance thereof;
(c) investments in certificates of deposit issued by any
Lender or by any United States commercial bank having capital and
surplus of not less than $100,000,000 which have a maturity of one
year or less;
(d) investments in repurchase obligations with a term of not
more than 7 days for underlying securities of the types described in
subsection (a) above entered into with any bank meeting the
qualifications specified in subsection (c) above, provided all such
agreements require physical delivery of the securities securing such
repurchase agreement, except those delivered through the Federal
Reserve Book Entry System;
(e) investments in money market funds that invest solely, and
which are restricted by their respective charters to invest solely,
in investments of the type described in the immediately preceding
subsections (a), (b), (c), and (d) above;
(f) Permitted Acquisitions;
(g) Permitted Existing Investments, and any refinancings,
renewals, replacements, modifications, restatements or extensions
thereof, in an amount not greater than the amount thereof on the
Closing Date;
(h) the Borrower's investments from time to time in the
Subsidiaries, and investments made from time to time by a Subsidiary
in one or more other Subsidiaries;
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(i) intercompany advances made from time to time between the
Borrower and one or more Subsidiaries or between Subsidiaries;
(j) investments consisting of loans or advances made by the
Parent and the Subsidiaries to employees of the Parent or the
Subsidiaries, including without limitation open-ended loans to cover
employees' income taxes on employee-owned stock of the Parent and
the Subsidiaries and ▇▇▇.▇▇▇, in an aggregate amount during any
fiscal year of the Parent not in excess of $2,000,000;
(k) other investments, loans, and advances in addition to
those otherwise permitted by this Section in an amount not to exceed
$5,000,000 in the aggregate at any one time outstanding, provided
that none of such investments, loans or advances pursuant to this
clause (k) shall be made to ▇▇▇.▇▇▇; and
(l) intercompany advances consisting of accounts
receivable/payable owed or owing in the ordinary course of business
representing bona fide services rendered by or to ▇▇▇.▇▇▇.
In determining the amount of investments, acquisitions, loans, and advances
permitted under this Section, investments and acquisitions shall always be taken
at the original cost thereof (regardless of any subsequent appreciation or
depreciation therein), and loans and advances shall be taken at the principal
amount thereof then remaining unpaid.
Section 8.10. Mergers, Consolidations and Sales. Neither the Parent nor
the Borrower shall, nor shall it permit any Subsidiary to, be a party to any
merger or consolidation, and neither the Borrower nor any Subsidiary shall sell,
transfer, lease or otherwise dispose of all or any part of its Property,
including without limitation stock of any Subsidiary or ▇▇▇.▇▇▇, and including
any disposition of Property as part of a sale and leaseback transaction, or in
any event sell or discount (with or without recourse) any of its notes or
accounts receivable; provided, however, that this Section shall not apply to nor
operate to prevent:
(a) the sale or lease of inventory in the ordinary course of
business;
(b) the sale, transfer, lease or other disposition of
Property of the Borrower and any Subsidiary to one another in the
ordinary course of its business;
(c) the merger of any Subsidiary (other than the Borrower)
with and into the Borrower or any Subsidiary provided that, in the
case of any merger involving the Borrower, the Borrower is the
corporation surviving the merger;
(d) the sale of delinquent notes or accounts receivable in
the ordinary course of business for purposes of collection only (and
not for the purpose of any bulk sale or securitization transaction);
(e) the sale, transfer, or other disposition of any tangible
personal property that, in the reasonable business judgment of the
Borrower or such Subsidiary, has become
-52-
uneconomical, obsolete, or worn out, and which is disposed of in the
ordinary course of business;
(f) the sale, transfer, lease, or other disposition of
Property of the Borrower or any Subsidiary (including any
disposition of Property as part of a sale and leaseback transaction)
aggregating for the Borrower and the Subsidiaries not more than
$10,000,000 during the term of this Agreement;
(g) transfers resulting from casualty or condemnation of
property or assets;
(h) licenses or sublicenses of intellectual property and
general intangibles and licenses, leases or subleases of other
property in the ordinary course of business which do not materially
interfere with the Borrower's or the relevant Subsidiary's business
including, without limitation, those trademarks licensed under the
terms of a trademark license agreement between the Borrower and
▇▇▇.▇▇▇;
(i) the sale, transfer, lease or other disposition of
Property of Renaissance;
(j) the pledge of Collateral pursuant to the Collateral
Documents and the incurrence of any Lien permitted under Section 8.8
hereof; and
(k) the making of investments permitted under Section 8.9
hereof.
So long as no Default or Event of Default has occurred and is continuing or
would arise as a result thereof, upon the written request of the Borrower, the
Administrative Agent shall release its Lien on any Property sold pursuant to the
foregoing provisions, and such Property shall be sold or otherwise disposed of
free and clear of the Lien created by the Collateral Documents and the
obligations under this Agreement (including, without limitation, the guaranty in
Section 12 hereof), and the Administrative Agent shall, at the expense of the
Borrower, take such actions as are appropriate and reasonably requested by the
Borrower in connection therewith.
Section 8.11. Maintenance of Subsidiaries. Neither the Parent nor the
Borrower shall assign, sell or transfer, nor shall they permit any Subsidiary to
issue, assign, sell or transfer, any shares of capital stock of a Subsidiary;
provided, however, that the foregoing shall not operate to prevent (a) Liens on
the capital stock of Subsidiaries granted to the Administrative Agent pursuant
to the Collateral Documents, (b) the issuance, sale and transfer to any person
of any shares of capital stock of a Subsidiary solely for the purpose of
qualifying, and to the extent legally necessary to qualify, such person as a
director of such Subsidiary, and (c) any transaction permitted by Section
8.10(c) or (i) above.
Section 8.12. Dividends and Certain Other Restricted Payments. The
Borrower shall not, nor shall it permit any Subsidiary to, (a) declare or pay
any dividends on or make any other distributions in respect of any class or
series of its capital stock or other equity interests or (b) directly or
indirectly purchase, redeem, or otherwise acquire or retire any of its capital
stock or other equity interests or any warrants or options to purchase any such
capital stock or equity interests or (c) directly or indirectly pay management
or consulting or similar fees to its
-53-
Affiliates (such payments or actions made or taken by any Person, collectively,
"Restricted Payments"); provided, however, that the foregoing shall not operate
to prevent:
(a) the making of dividends or distributions by any
Wholly-owned Subsidiary to its parent corporation provided that
dividends to the Parent shall only be permitted to the extent they
comply with the provisions of clause (x) of the proviso at the end
of this Section 8.12;
(b) management fees in an amount not to exceed $2,000,000 in
any one fiscal year pursuant to the Management Consulting Services
Agreement dated December 18, 1994 among the Parent, Perry
Principals, L.L.C., ▇▇▇▇ Capital, Inc. and Fleet Growth Resources,
Inc. (the "Management Consulting Services Agreement"), provided,
however, that if the Parent or the Borrower is prohibited from
paying all or any portion of such management fees in any particular
fiscal year, and such prohibition ceases to be applicable for any
reason, then the portion of such management fees which was permitted
to be paid pursuant to this Agreement but which the Parent or the
Borrower was otherwise prohibited from paying may be paid in the
immediately following fiscal year, but not thereafter;
(c) the reimbursement of Perry Principals, L.L.C., ▇▇▇▇
Capital, Inc. and Fleet Growth Resources, Inc. or any of their
respective successors or assigns for their reasonable out-of-pocket
expenses permitted pursuant to the Management Consulting Services
Agreement not to exceed $300,000 in any one fiscal year incurred by
them in connection with performing management services to the
Borrower and the Subsidiaries;
(d) additional Restricted Payments which do not exceed, for
the period commencing with the Parent's fiscal year ended June 30,
2001, and ending on the last day of the last quarter ending prior to
such Restricted Payment, the sum of (i) fifty percent (50.0%) of Net
Income for such period (or, if Net Income for such period is a
deficit, less 100% of such deficit), and (ii) the aggregate Net Cash
Proceeds from the sale or issuance of equity interests (other than
Disqualified Stock) of the Borrower for such period, and (iii) the
aggregate amount of any monies received by the Borrower by way of
dividend or distribution from ▇▇▇.▇▇▇ during such period;
(e) the repurchase or redemption of capital stock or options
to purchase capital stock of the Parent, the Subsidiaries and
▇▇▇.▇▇▇ held by employees or former employees of the Parent, the
Subsidiaries and ▇▇▇.▇▇▇ in an aggregate amount not to exceed (i) in
any fiscal year (w) $5,000,000, plus (x) the proceeds received by
the Borrower or the Parent from the sale of any management or
employee capital stock or other rights during such fiscal year, and
(ii) during the term of this Agreement, (y) $10,000,000, plus (z)
the proceeds received by the Borrower or the Parent from the sale of
any management or employee capital stock or other rights during the
term of this Agreement; and
(f) the repurchase or redemption of capital stock or options
to purchase capital stock of the Parent, other than repurchases or
redemptions pursuant to the
-54-
immediately preceding clause (e), in an aggregate amount not in
excess of $2,000,000 during the term of this Agreement;
provided, however, that (x) the Borrower may only pay cash dividends of the
types described in clauses (b), (c), (e) and (f), above to the Parent so long as
the Parent uses such dividends for the purposes described in such clauses and
subject to the limits contained therein; and (y) the Restricted Payments
described in clauses (b), (c), (d), (e) and (f) above shall not be permitted if
either an Event of Default or a Default shall have occurred and be continuing at
the date of declaration or payment thereof or would result therefrom.
Section 8.13. ERISA. The Borrower shall, and shall cause each
Subsidiary to, promptly pay and discharge all obligations and liabilities
arising under ERISA of a character which if unpaid or unperformed could
reasonably be expected to result in the imposition of a Lien against any of its
Property. The Borrower shall, and shall cause each Subsidiary to, promptly
notify the Administrative Agent and each Lender of: (a) the occurrence of any
reportable event (as defined in ERISA) with respect to a Plan, (b) receipt of
any notice from the PBGC of its intention to seek termination of any Plan or
appointment of a trustee therefor, (c) its intention to terminate or withdraw
from any Plan, and (d) the occurrence of any event with respect to any Plan
which would result in the incurrence by the Borrower or any Subsidiary or any
member of the Controlled Group of any material liability, fine or penalty, or
any material increase in the contingent liability of the Borrower or any
Subsidiary or any member of the Controlled Group with respect to any
post-retirement Welfare Plan benefit.
Section 8.14. Compliance with Laws. (a) Each of the Parent and the
Borrower shall, and shall cause each Subsidiary to, comply in all respects with
the requirements of all federal, state and local laws, rules, regulations,
ordinances and orders applicable to or pertaining to its Property or business
operations, where any such non-compliance, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect or result in a
Lien upon any of its Property.
(b) Without limiting the agreements set forth in Section 8.14(a)
above, the Borrower shall at all times, and shall cause each Subsidiary to at
all times, do the following to the extent the failure to do so could reasonably
be expected to have a Material Adverse Effect: (i) comply in all material
respects with, and maintain each of the Premises in compliance in all material
respects with, all applicable Environmental Laws; (ii) require that each tenant
and subtenant, if any, of any of the Premises or any part thereof comply in all
material respects with all applicable Environmental Laws; (iii) obtain and
maintain in full force and effect all material governmental approvals required
by any applicable Environmental Law for operations at each of the Premises; (iv)
cure any material violation by it or at any of the Premises of applicable
Environmental Laws; (v) not allow the operation at any of the Premises of any
(1) landfill or dump or (2) hazardous waste treatment, storage, or disposal
facility or solid waste disposal facility as defined pursuant to RCRA or any
comparable state law; (vi) not manufacture, use, generate, transport, treat,
store, release, dispose or handle any Hazardous Material at any of the Premises
except in the ordinary course of its business and in material compliance with
Environmental Law; (vii) within 10 Business Days notify the Administrative Agent
in writing of and provide any reasonably requested documents upon learning of
any of the following in connection with the Borrower or
-55-
any Subsidiary or any of the Premises: (1) any material liability for response
or corrective action, natural resource damage or other harm pursuant to CERCLA,
RCRA or any comparable state law; (2) any material Environmental Claim; (3) any
material violation of an Environmental Law or material release, threatened
release or disposal of a Hazardous Material; (4) any material restriction on the
ownership, occupancy, use or transferability arising pursuant to any (x)
release, threatened release or disposal of a Hazardous Substance or (y)
Environmental Law; or (5) any environmental, natural resource, health or safety
condition, which could reasonably be expected to have a Material Adverse Effect;
(viii) conduct at its expense any investigation, study, sampling, testing,
abatement, cleanup, removal, remediation or other response action necessary to
remove, remediate, clean up or ▇▇▇▇▇ any material release, threatened release or
disposal of a Hazardous Material as required by any applicable Environmental
Law, (ix) abide by and observe any material restrictions on the use of the
Premises imposed by any governmental authority as set forth in a deed or other
instrument affecting the Borrower's or any Subsidiary's interest therein; (x)
promptly provide or otherwise make available to the Administrative Agent any
reasonably requested non-privileged environmental record concerning the Premises
which the Borrower or any Subsidiary possesses or can reasonably obtain; and
(xi) perform, satisfy, and implement any material operation or maintenance
actions required by any Environmental Law, or included in any no further action
letter or covenant not to ▇▇▇ issued by any governmental authority under any
Environmental Law.
Section 8.15. Burdensome Contracts With Affiliates. The Borrower shall
not, nor shall it permit any Subsidiary to, enter into any contract, agreement
or business arrangement with any of its Affiliates on terms and conditions which
at the time such contract, agreement or arrangement is entered into, are less
favorable to the Borrower or such other Subsidiary than would be usual and
customary in similar contracts, agreements or business arrangements entered into
at such time between Persons not affiliated with each other, provided that
notwithstanding the foregoing restriction, the Borrower and ▇▇▇.▇▇▇ will, in any
renegotiation of the Commission Agreement dated October 1, 1999 between them,
use a methodology for selecting rebate amounts which is consistent with and no
more favorable to ▇▇▇.▇▇▇ than that used in such agreement as in effect on the
Closing Date.
Section 8.16. No Changes in Fiscal Year. Neither the Parent nor the
Borrower shall, nor shall they permit any Subsidiary to, change its fiscal year
from its present basis.
Section 8.17. Formation of Subsidiaries. Except for existing
Subsidiaries designated on Schedule 6.2 hereto and Subsidiaries formed or
acquired after the date of this Agreement in connection with a Permitted
Acquisition, the Borrower shall not, nor shall it permit any Subsidiary to, form
or acquire any other Subsidiaries without the prior written consent of the
Required Lenders. In the event any Subsidiary is formed or acquired in
connection with a Permitted Acquisition, the Borrower shall give the
Administrative Agent and the Lenders prior written notice of any such event and,
immediately after giving effect thereto, Schedule 6.2 of this Agreement shall be
deemed amended to include reference to such Subsidiary.
Section 8.18. Change in the Nature of Business. The Borrower shall not,
nor shall it permit any Subsidiary to, engage in any business or activity if as
a result the general nature of the business of the Borrower and the Subsidiaries
taken as a whole would be changed in any material
-56-
respect from the general nature of the business engaged in by such entities
taken as a whole as of the Closing Date.
Section 8.19. Use of Loan Proceeds. The Borrower shall use the credit
extended under this Agreement solely for the purposes set forth in, or otherwise
permitted by, Section 6.4 hereof.
Section 8.20. Limitations on Subsidiary Distributions and Certain Other
Restrictions. Except as provided herein, neither the Parent nor the Borrower
shall, nor shall they permit any Subsidiary to, directly or indirectly to create
or otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of the Parent or any
Subsidiary to: (a) guarantee the Obligations as required by Sections 4 and 12
hereof; (b) in the case of any Subsidiary (including the Borrower), pay
dividends or make any other distribution on any of such Subsidiary's capital
stock or other equity interests owned by the Parent, the Borrower or any other
Subsidiary; (c) pay any indebtedness owed to the Parent, the Borrower or any
other Subsidiary; (d) make loans or advances to the Parent, the Borrower or any
other Subsidiary; or (e) transfer any of its Property to the Parent, the
Borrower or any other Subsidiary.
Section 8.21. Subordinated Debt. Neither the Parent nor the Borrower
shall, nor shall they permit any Subsidiary to, amend or modify any of the terms
or conditions relating to any Subordinated Debt or make any voluntary prepayment
thereof or effect any voluntary redemption thereof or make any payment on
account of Subordinated Debt which is prohibited under the terms of any
instrument or agreement subordinating the same to the Obligations.
Section 8.22. Total Funded Debt/EBITDA Ratio. The Parent shall not
permit the Total Funded Debt/EBITDA Ratio as of the last day of any fiscal
quarter of the Parent to be greater than:
TOTAL FUNDED
DEBT/EBITDA RATIO SHALL
FROM AND INCLUDING TO AND INCLUDING NOT BE GREATER THAN:
The date hereof March 31, 2003 2.75 to 1.0
April 1, 2003 And at all times thereafter 2.50 to 1.0
Section 8.23. Net Worth. (a) The Parent shall, at all times, maintain
Net Worth of the Parent and the Subsidiaries determined on a consolidated basis
in an amount not less than the sum of (a) $24,000,000, plus (b) 50% of Net
Income for each fiscal quarter of the Parent ending on and after September 30,
2001, for which such Net Income is a positive amount (i.e., there shall be no
reduction to the amount of Net Worth required to be maintained hereunder for any
fiscal year in which Net Income is less than zero) plus (c) 100% of the Net Cash
Proceeds from the Parent's or any of the Subsidiaries' issuance of new equity
securities pursuant to Section 1.13(b)(ii) hereof.
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(b) The Parent shall cause ▇▇▇.▇▇▇ to at all times maintain Net
Worth of ▇▇▇.▇▇▇ in an amount not less than $0.00.
Section 8.24. Fixed Charge Coverage Ratio. As of the last day of each
fiscal quarter of the Parent, the Parent shall maintain a ratio of (a) EBITDA
less Capital Expenditures for the four fiscal quarters of the Parent and the
Subsidiaries then ended to (b) Fixed Charges for the same four fiscal quarters
then ended of not less than 1.75 to 1.0.
Section 8.25. Interest Rate Protection. Not later than 90 days
following the Closing Date, the Borrower will hedge its interest rate risk on at
least $20,000,000 of the principal amount of the Revolving Loans outstanding
through the use of one or more interest rate swaps, interest rate caps, interest
rate collars or other recognized interest rate hedging arrangements, with all of
the foregoing to effectively limit the amount of interest that the Borrower must
pay on notional amounts of not less than such portion of the Revolving Loans to
not more than a rate acceptable to the Administrative Agent in its discretion
for a period ending no earlier than two calendar years after the Closing Date
and to be with the Lenders, their respective Affiliates or with other parties
reasonably acceptable to the Administrative Agent.
Section 8.26. Ownership and Status of ▇▇▇.▇▇▇. The Borrower shall at
all times own not less than 51% of the outstanding capital stock of ▇▇▇.▇▇▇ and
▇▇▇.▇▇▇ shall not be permitted to merge or consolidate with or into any Person.
SECTION 9. EVENTS OF DEFAULT AND REMEDIES.
Section 9.1. Events of Default. Any one or more of the following shall
constitute an "Event of Default" hereunder:
(a) default in the payment when due of all or any part of the
principal of or, for a period of three Business Days or more, any
interest on any Note (whether at the stated maturity thereof or at
any other time provided for in this Agreement) or of any
Reimbursement Obligation or of any fee or other Obligation payable
hereunder or under any other Loan Document;
(b) default in the observance or performance of any covenant
set forth in Sections 8.1, 8.7, 8.8, or 8.9 (subject in each case to
the provisions of clause (c) immediately following), or in Sections
8.5, 8.10, 8.11, 8.12, 8.18, 8.19, 8.20, 8.21, 8.22, 8.23, 8.24,
8.25 or 8.26 hereof or of any provision in any Loan Document dealing
with the use, disposition or remittance of the proceeds of
Collateral or requiring the maintenance of insurance thereon;
(c) default in the observance or performance of (1) any
requirement set forth in the second sentence of Section 8.1 hereof
which can be cured after a temporary lapse if such lapse does not
exceed 30 days and would not reasonably be expected to have a
Material Adverse Effect, (2) any violation of Section 8.7 or 8.8
hereof resulting from an involuntary or immaterial incurrence of
indebtedness or of a Lien, as the case may be, (3) any violation of
any of clauses (a), (b), (c), (d), (e), (g), (h), (i), (k) or (l) of
Section 8.9
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hereof resulting from an involuntary or immaterial investment, or
(4) any other provision hereof or of any other Loan Document which,
in the case of any of the defaults described in subclauses (1), (2),
(3) or (4) of this clause (c), is not remedied within 30 days after
the earlier of (i) the date on which such failure shall first become
known to any officer of the Parent or the Borrower or (ii) written
notice thereof is given to the Borrower by the Administrative Agent;
(d) any representation or warranty made herein or in any
other Loan Document or in any certificate furnished to the
Administrative Agent or the Lenders pursuant hereto or thereto or in
connection with any transaction contemplated hereby or thereby
proves untrue in any material respect as of the date of the issuance
or making or deemed making thereof;
(e) any event occurs or condition exists (other than those
described in subsections (a) through (d) above) which is specified
as an event of default under any of the other Loan Documents, or any
of the Loan Documents shall for any reason not be or shall cease to
be in full force and effect or is declared to be null and void, or
any of the Collateral Documents shall for any reason fail to create
a valid and perfected first priority Lien in favor of the
Administrative Agent in any Collateral purported to be covered
thereby except as expressly permitted by the terms thereof, or the
Parent, the Borrower any other Subsidiary takes any action for the
purpose of terminating, repudiating or rescinding any Loan Document
executed by it or any of its obligations thereunder;
(f) default shall occur under any Indebtedness for Borrowed
Money issued, assumed or guaranteed by the Parent, the Borrower or
any Subsidiary aggregating in excess of $5,000,000, or under any
indenture, agreement or other instrument under which the same may be
issued, and such default shall continue for a period of time
sufficient to permit the acceleration of the maturity of any such
Indebtedness for Borrowed Money (whether or not such maturity is in
fact accelerated), or any such Indebtedness for Borrowed Money shall
not be paid when due (whether by demand, lapse of time, acceleration
or otherwise);
(g) any judgment or judgments, writ or writs or warrant or
warrants of attachment, or any similar process or processes shall be
entered or filed against the Parent, the Borrower or any other
Subsidiary, or against any of its Property, in an aggregate amount
in excess of $2,500,000 in excess of any applicable insurance
coverage (provided the insurer has accepted liability therefor in
writing), and which remains undischarged, unvacated, unbonded or
unstayed for a period of 30 days;
(h) the Borrower or any Subsidiary, or any member of its
Controlled Group, shall fail to pay when due an amount or amounts
aggregating in excess of $1,000,000 which it shall have become
liable to pay to the PBGC or to a Plan under Title IV of ERISA; or
notice of intent to terminate a Plan or Plans having aggregate
Unfunded Vested Liabilities in excess of $1,000,000 (collectively, a
"Material Plan") shall be filed under Title IV of ERISA by the
Borrower or any Subsidiary, or any other member of its Controlled
Group, any plan administrator or any combination of the foregoing;
or the
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PBGC shall institute proceedings under Title IV of ERISA to
terminate or to cause a trustee to be appointed to administer any
Material Plan or a proceeding shall be instituted by a fiduciary of
any Material Plan against the Borrower or any Subsidiary, or any
member of its Controlled Group, to enforce Section 515 or 4219(c)(5)
of ERISA and such proceeding shall not have been dismissed within 30
days thereafter; or a condition shall exist by reason of which the
PBGC would be entitled to obtain a decree adjudicating that any
Material Plan must be terminated;
(i) the Parent, the Borrower or any other Subsidiary shall
(i) have entered involuntarily against it an order for relief under
the United States Bankruptcy Code, as amended, (ii) not pay, or
admit in writing its inability to pay, its debts generally as they
become due, (iii) make an assignment for the benefit of creditors,
(iv) apply for, seek, consent to, or acquiesce in, the appointment
of a receiver, custodian, trustee, examiner, liquidator or similar
official for it or any substantial part of its Property, (v)
institute any proceeding seeking to have entered against it an order
for relief under the United States Bankruptcy Code, as amended, to
adjudicate it insolvent, or seeking dissolution, winding up,
liquidation, reorganization, arrangement, adjustment or composition
of it or its debts under any law relating to bankruptcy, insolvency
or reorganization or relief of debtors or fail to file an answer or
other pleading denying the material allegations of any such
proceeding filed against it, (vi) take any corporate action in
furtherance of any matter described in parts (i) through (v) above,
or (vii) fail to contest in good faith any appointment or proceeding
described in Section 9.1(j) hereof; or
(j) a custodian, receiver, trustee, examiner, liquidator or
similar official shall be appointed for the Parent, the Borrower or
any Subsidiary, or any substantial part of any of its Property, or a
proceeding described in Section 9.1(i)(v) shall be instituted
against the Parent, the Borrower or any Subsidiary, and such
appointment continues undischarged or such proceeding continues
undismissed or unstayed for a period of 60 days.
Section 9.2. Non-Bankruptcy Defaults. When any Event of Default other
than those described in subsection (i) or (j) of Section 9.1 hereof has occurred
and is continuing, the Administrative Agent shall, by written notice to the
Borrower: (a) if so directed by the Required Lenders, terminate the remaining
Commitments and all other obligations of the Lenders hereunder on the date
stated in such notice (which may be the date thereof); (b) if so directed by the
Required Lenders, declare the principal of and the accrued interest on all
outstanding Notes to be forthwith due and payable and thereupon all outstanding
Notes, including both principal and interest thereon, shall be and become
immediately due and payable together with all other amounts payable under the
Loan Documents without further demand, presentment, protest or notice of any
kind; and (c) if so directed by the Required Lenders, demand that the Borrower
immediately pay to the Administrative Agent the full amount then available for
drawing under each or any Letter of Credit, and the Borrower agrees to
immediately make such payment and acknowledges and agrees that the Lenders would
not have an adequate remedy at law for failure by the Borrower to honor any such
demand and that the Administrative Agent, for the benefit of the Lenders, shall
have the right to require the Borrower to specifically perform such undertaking
whether or not any drawings or other demands for payment have been made under
any Letter of
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Credit. The Administrative Agent, after giving notice to the Borrower pursuant
to Section 9.1(c) or this Section 9.2, shall also promptly send a copy of such
notice to the other Lenders, but the failure to do so shall not impair or annul
the effect of such notice.
Section 9.3. Bankruptcy Defaults. When any Event of Default described
in subsections (i) or (j) of Section 9.1 hereof has occurred and is continuing,
then all outstanding Notes shall immediately become due and payable together
with all other amounts payable under the Loan Documents without presentment,
demand, protest or notice of any kind, the obligation of the Lenders to extend
further credit pursuant to any of the terms hereof shall immediately terminate
and the Borrower shall immediately pay to the Administrative Agent the full
amount then available for drawing under all outstanding Letters of Credit, the
Borrower acknowledging and agreeing that the Lenders would not have an adequate
remedy at law for failure by the Borrower to honor any such demand and that the
Lenders, and the Administrative Agent on their behalf, shall have the right to
require the Borrower to specifically perform such undertaking whether or not any
draws or other demands for payment have been made under any of the Letters of
Credit.
Section 9.4. Collateral for Undrawn Letters of Credit. (a) If the
prepayment of the amount available for drawing under any or all outstanding
Letters of Credit is required under Section 1.9(b) or under Section 9.2 or 9.3
above, the Borrower shall forthwith pay the amount required to be so prepaid, to
be held by the Administrative Agent as provided in subsection (b) below.
(b) All amounts prepaid pursuant to subsection (a) above shall be
held by the Administrative Agent in one or more separate collateral accounts
(each such account, and the credit balances, properties and any investments from
time to time held therein, and any substitutions for such account, any
certificate of deposit or other instrument evidencing any of the foregoing and
all proceeds of and earnings on any of the foregoing being collectively called
the "Collateral Account") as security for, and for application by the
Administrative Agent (to the extent available) to, the reimbursement of any
payment under any Letter of Credit then or thereafter made by the Administrative
Agent, and to the payment of the unpaid balance of any Loans and all other
Obligations. The Collateral Account shall be held in the name of and subject to
the exclusive dominion and control of the Administrative Agent for the benefit
of the Administrative Agent, the Lenders and the L/C Issuer. If and when
requested by the Borrower, the Administrative Agent shall invest funds held in
the Collateral Account from time to time in direct obligations of, or
obligations the principal of and interest on which are unconditionally
guaranteed by, the United States of America with a remaining maturity of one
year or less, provided that the Administrative Agent is irrevocably authorized
to sell investments held in the Collateral Account when and as required to make
payments out of the Collateral Account for application to amounts due and owing
from the Borrower to the L/C Issuer, the Administrative Agent or the Lenders;
provided, however, that if (i) the Borrower shall have made payment of all such
obligations referred to in subsection (a) above, (ii) all relevant preference or
other disgorgement periods relating to the receipt of such payments have passed,
and (iii) no Letters of Credit, Commitments, Loans or other Obligations remain
outstanding hereunder, then the Administrative Agent shall promptly release to
the Borrower any remaining amounts held in the Collateral Account.
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Section 9.5. Notice of Default. The Administrative Agent shall give
notice to the Borrower under Section 9.1(c) hereof promptly upon being requested
to do so by any Lender and shall thereupon notify all the Lenders thereof.
Section 9.6. Expenses. The Borrower agrees to pay to the Administrative
Agent and each Lender, and any other holder of any Note outstanding hereunder,
all expenses reasonably incurred or paid by the Administrative Agent and such
Lender or any such holder, including reasonable attorneys' fees (including
allocated costs of in-house counsel) and court costs, in connection with any
Default or Event of Default by the Borrower hereunder or in connection with the
enforcement of any of the Loan Documents (including all such costs and expenses
arising in connection with a proceeding under the United States Bankruptcy
Code).
SECTION 10. CHANGE IN CIRCUMSTANCES.
Section 10.1. Change of Law. Notwithstanding any other provisions of
this Agreement or any Note, if at any time any change in applicable law or
regulation or in the interpretation thereof makes it unlawful for any Lender to
make or continue to maintain any Eurodollar Loans or to perform its obligations
as contemplated hereby, such Lender shall promptly give notice thereof to the
Borrower and such Lender's obligations to make or maintain Eurodollar Loans
under this Agreement shall be suspended until it is no longer unlawful for such
Lender to make or maintain Eurodollar Loans. The Borrower shall prepay on demand
the outstanding principal amount of any such affected Eurodollar Loans, together
with all interest accrued thereon and all other amounts then due and payable to
such Lender under this Agreement; provided, however, subject to all of the terms
and conditions of this Agreement, the Borrower may then elect to borrow the
principal amount of the affected Eurodollar Loans from such Lender by means of
Base Rate Loans from such Lender, which Base Rate Loans shall not be made
ratably by the Lenders but only from such affected Lender.
Section 10.2. Unavailability of Deposits or Inability to Ascertain, or
Inadequacy of, LIBOR. If on or prior to the first day of any Interest Period for
any Borrowing of Eurodollar Loans:
(a) the Administrative Agent determines that deposits in U.S.
Dollars (in the applicable amounts) are not being offered to it in
the interbank eurodollar market for such Interest Period, or that by
reason of circumstances affecting the interbank eurodollar market
adequate and reasonable means do not exist for ascertaining the
applicable LIBOR, or
(b) the Required Lenders advise the Administrative Agent that
(i) LIBOR as determined by the Administrative Agent will not
adequately and fairly reflect the cost to such Lenders of funding
their Eurodollar Loans for such Interest Period or (ii) that the
making or funding of Eurodollar Loans become impracticable,
then the Administrative Agent shall forthwith give notice thereof to the
Borrower and the Lenders, whereupon until the Administrative Agent notifies the
Borrower that the circumstances
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giving rise to such suspension no longer exist, the obligations of the Lenders
to make Eurodollar Loans shall be suspended.
Section 10.3. Increased Cost and Reduced Return. (a) If, on or after
the date hereof, the adoption of any applicable law, rule or regulation, or any
change therein, or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender (or its
Lending Office) with any request or directive (whether or not having the force
of law) of any such authority, central bank or comparable agency:
(i) shall subject any Lender (or its Lending Office) to any
tax, duty or other charge with respect to its Fixed Rate Loans, its
Notes, its Letter(s) of Credit, or its participation in any thereof,
any Reimbursement Obligations owed to it or its obligation to make
Fixed Rate Loans, issue a Letter of Credit, or to participate
therein, or shall change the basis of taxation of payments to any
Lender (or its Lending Office) of the principal of or interest on
its Fixed Rate Loans, Letter(s) of Credit, or participations therein
or any other amounts due under this Agreement or any other Loan
Document in respect of its Fixed Rate Loans, Letter(s) of Credit,
any participation therein, any Reimbursement Obligations owed to it,
or its obligation to make Fixed Rate Loans, or issue a Letter of
Credit, or acquire participations therein (except for changes in the
rate of tax on the overall net income of such Lender or its Lending
Office imposed by the jurisdiction in which such Lender's principal
executive office or Lending Office is located); or
(ii) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement (including, without
limitation, any such requirement imposed by the Board of Governors
of the Federal Reserve System, but excluding with respect to any
Fixed Rate Loans any such requirement included in an applicable
Fixed Rate Reserve Percentage) against assets of, deposits with or
for the account of, or credit extended by, any Lender (or its
Lending Office) or shall impose on any Lender (or its Lending
Office) or on the interbank market any other condition affecting its
Fixed Rate Loans, its Notes, its Letter(s) of Credit, or its
participation in any thereof, any Reimbursement Obligation owed to
it, or its obligation to make Fixed Rate Loans, or to issue a Letter
of Credit, or to participate therein;
and the result of any of the foregoing is to increase the cost to such Lender
(or its Lending Office) of making or maintaining any Fixed Rate Loan, issuing or
maintaining a Letter of Credit, or participating therein, or to reduce the
amount of any sum received or receivable by such Lender (or its Lending Office)
under this Agreement or under any other Loan Document with respect thereto, by
an amount deemed by such Lender to be material, then, within 15 days after
demand by such Lender (with a copy to the Administrative Agent), the Borrower
shall be obligated to pay to such Lender such additional amount or amounts as
will compensate such Lender for such increased cost or reduction.
(b) If, after the date hereof, any Lender or the Administrative
Agent shall have determined that the adoption of any applicable law, rule or
regulation regarding capital
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adequacy, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Lender (or its Lending Office) with any request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has had the effect of reducing the rate of
return on such Lender's capital as a consequence of its obligations hereunder to
a level below that which such Lender could have achieved but for such adoption,
change or compliance (taking into consideration such Lender's policies with
respect to capital adequacy) by an amount deemed by such Lender to be material,
then from time to time, within 15 days after demand by such Lender (with a copy
to the Administrative Agent), the Borrower shall pay to such Lender such
additional amount or amounts as will compensate such Lender for such reduction.
(c) A certificate of a Lender claiming compensation under this
Section 10.3 and setting forth the additional amount or amounts to be paid to it
hereunder shall be conclusive if reasonably determined. In determining such
amount, such Lender may use any reasonable averaging and attribution methods.
Section 10.4. Lending Offices. Each Lender may, at its option, elect to
make its Loans hereunder at the branch, office or affiliate specified on the
appropriate signature page hereof (each a "Lending Office") for each type of
Loan available hereunder or at such other of its branches, offices or affiliates
as it may from time to time elect and designate in a written notice to the
Borrower and the Administrative Agent. To the extent reasonably possible, a
Lender shall designate an alternative branch or funding office with respect to
its Eurodollar Loans to reduce any liability of the Borrower to such Lender
under Section 10.3 hereof or to avoid the unavailability of Eurodollar Loans
under Section 10.2 hereof, so long as such designation is not otherwise
disadvantageous to the Lender.
Section 10.5. Discretion of Lender as to Manner of Funding.
Notwithstanding any other provision of this Agreement, 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 hereunder, including, without limitation, under
Section 1.12 hereof, with respect to Eurodollar Loans shall be made as if each
Lender had actually funded and maintained each Eurodollar Loan through the
purchase of deposits in the interbank eurodollar market having a maturity
corresponding to such Loan's Interest Period and bearing an interest rate equal
to LIBOR for such Interest Period.
SECTION 11. THE ADMINISTRATIVE AGENT.
Section 11.1. Appointment and Authorization of Administrative Agent.
Each Lender hereby appoints ▇▇▇▇▇▇ Trust and Savings Bank as the Administrative
Agent under the Loan Documents and hereby authorizes the Administrative Agent to
take such action as Administrative Agent on its behalf and to exercise such
powers under the Loan Documents as are delegated to the Administrative Agent by
the terms thereof, together with such powers as are reasonably incidental
thereto. The Lenders expressly agree that the Administrative Agent is not acting
as a fiduciary of the Lenders in respect of the Loan Documents, the Borrower or
any Guarantor or otherwise, and nothing herein or in any of the other Loan
Documents shall result in
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any duties or obligations on the Administrative Agent or any of the Lenders
except as expressly set forth herein.
Section 11.2. Administrative Agent and its Affiliates. The
Administrative Agent shall have the same rights and powers under this Agreement
and the other Loan Documents as any other Lender and may exercise or refrain
from exercising such rights and power as though it were not the Administrative
Agent, and the Administrative Agent and its affiliates may accept deposits from,
lend money to, and generally engage in any kind of business with the Borrower or
any Affiliate of the Borrower as if it were not the Administrative Agent under
the Loan Documents. The term "Lender" as used herein and in all other Loan
Documents, unless the context otherwise clearly requires, includes the
Administrative Agent in its individual capacity as a Lender. References in
Section 1 hereof to the Administrative Agent's Loans, or to the amount owing to
the Administrative Agent for which an interest rate is being determined, refer
to the Administrative Agent in its individual capacity as a Lender.
Section 11.3. Action by Administrative Agent. If the Administrative
Agent receives from the Parent or the Borrower a written notice of an Event of
Default pursuant to Section 8.5(m) hereof, the Administrative Agent shall
promptly give each of the Lenders written notice thereof. The obligations of the
Administrative Agent under the Loan Documents are only those expressly set forth
therein. Without limiting the generality of the foregoing, the Administrative
Agent shall not be required to take any action hereunder with respect to any
Default or Event of Default, except as expressly provided in Sections 9.2 and
9.5. Unless and until the Required Lenders give such direction, the
Administrative Agent may (but shall not be obligated to) take or refrain from
taking such actions as it deems appropriate and in the best interest of all the
Lenders. In no event, however, shall the Administrative Agent be required to
take any action in violation of applicable law or of any provision of any Loan
Document, and the Administrative Agent shall in all cases be fully justified in
failing or refusing to act hereunder or under any other Loan Document unless it
first receives any further assurances of its indemnification from the Lenders
that it may require, including prepayment of any related expenses and any other
protection it requires against any and all costs, expense and liability which
may be incurred by it by reason of taking or continuing to take any such action.
The Administrative Agent shall be entitled to assume that no Default or Event of
Default exists unless notified in writing to the contrary by a Lender or the
Parent or the Borrower. In all cases in which the Loan Documents do not require
the Administrative Agent to take specific action, the Administrative Agent shall
be fully justified in using its discretion in failing to take or in taking any
action thereunder. Any instructions of the Required Lenders, or of any other
group of Lenders called for under the specific provisions of the Loan Documents,
shall be binding upon all the Lenders and the holders of the Obligations.
Section 11.4. Consultation with Experts. The Administrative Agent may
consult with legal counsel, independent public accountants and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken by it in good faith in accordance with the advice of such counsel,
accountants or experts.
Section 11.5. Liability of Administrative Agent; Credit Decision.
Neither the Administrative Agent nor any of its directors, officers, agents, or
employees shall be liable for any action taken or not taken by it in connection
with the Loan Documents: (a) with the consent
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or at the request of the Required Lenders or (b) in the absence of its own gross
negligence or willful misconduct. Neither the Administrative Agent nor any of
its directors, officers, agents or employees shall be responsible for or have
any duty to ascertain, inquire into or verify: (i) any statement, warranty or
representation made in connection with this Agreement, any other Loan Document
or any Credit Event; (ii) the performance or observance of any of the covenants
or agreements of the Parent, the Borrower or any other Subsidiary contained
herein or in any other Loan Document; (iii) the satisfaction of any condition
specified in Section 7 hereof, except receipt of items required to be delivered
to the Administrative Agent; or (iv) the validity, effectiveness, genuineness,
enforceability, perfection, value, worth or collectibility hereof or of any
other Loan Document or of any other documents or writing furnished in connection
with any Loan Document or of any Collateral; and the Administrative Agent makes
no representation of any kind or character with respect to any such matter
mentioned in this sentence. The Administrative Agent may execute any of its
duties under any of the Loan Documents by or through employees, agents, and
attorneys-in-fact and shall not be answerable to the Lenders, the Borrower, or
any other Person for the default or misconduct of any such agents or
attorneys-in-fact selected with reasonable care. The Administrative Agent shall
not incur any liability by acting in reliance upon any notice, consent,
certificate, other document or statement (whether written or oral) believed by
it to be genuine or to be sent by the proper party or parties. In particular and
without limiting any of the foregoing, the Administrative Agent shall have no
responsibility for confirming the accuracy of any compliance certificate or
other document or instrument received by it under the Loan Documents. The
Administrative Agent may treat the payee of any Note as the holder thereof until
written notice of transfer shall have been filed with the Administrative Agent
signed by such payee in form satisfactory to the Administrative Agent. Each
Lender acknowledges that it has independently and without reliance on the
Administrative Agent or any other Lender, and based upon such information,
investigations and inquiries as it deems appropriate, made its own credit
analysis and decision to extend credit to the Borrower in the manner set forth
in the Loan Documents. It shall be the responsibility of each Lender to keep
itself informed as to the creditworthiness of the Parent, the Borrower and their
Subsidiaries, and the Administrative Agent shall have no liability to any Lender
with respect thereto.
Section 11.6. Indemnity. The Lenders shall ratably, in accordance with
their respective Percentages, indemnify and hold the Administrative Agent, and
its directors, officers, employees, agents and representatives harmless from and
against any liabilities, losses, costs or expenses suffered or incurred by it
under any Loan Document or in connection with the transactions contemplated
thereby, regardless of when asserted or arising, except to the extent they are
promptly reimbursed for the same by the Borrower and except to the extent that
any event giving rise to a claim was caused by the gross negligence or willful
misconduct of the party seeking to be indemnified. The obligations of the
Lenders under this Section shall survive termination of this Agreement. The
Administrative Agent shall be entitled to offset amounts received for the
account of a Lender under this Agreement against unpaid amounts due from such
Lender to the Administrative Agent hereunder (whether as fundings of
participations, indemnities or otherwise), but shall not be entitled to offset
against amounts owed to the Administrative Agent by any Lender arising outside
of this Agreement.
Section 11.7. Resignation of Administrative Agent and Successor
Administrative Agent. The Administrative Agent may resign at any time by giving
written notice thereof to the Lenders
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and the Borrower. Upon any such resignation of the Administrative Agent, the
Required Lenders shall have the right to appoint a successor Administrative
Agent. 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 of notice of resignation then the
retiring Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent, which shall be any Lender hereunder or any commercial bank
organized under the laws of the United States of America or of any State thereof
and having a combined capital and surplus of at least $200,000,000. Upon the
acceptance of its appointment as the Administrative Agent hereunder, such
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights and duties of the retiring Administrative Agent under the Loan
Documents, and the retiring Administrative Agent shall be discharged from its
duties and obligations thereunder. After any retiring Administrative Agent's
resignation hereunder as Administrative Agent, the provisions of this Section 11
and all protective provisions of the other Loan Documents shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent, but no successor Administrative Agent shall in any event
be liable or responsible for any actions of its predecessor. If the
Administrative Agent resigns and no successor is appointed, the rights and
obligations of such Administrative Agent shall be automatically assumed by the
Required Lenders and (a) the Borrower shall be directed to make all payments due
each Lender hereunder directly to such Lender and (b) the Administrative Agent's
rights in the Collateral Documents shall be assigned without representation,
recourse, or warranty to the Lenders as their interests may appear.
Section 11.8. L/C Issuer. Each L/C Issuer shall act on behalf of the
Lenders with respect to any Letters of Credit issued by it and the documents
associated therewith. Each L/C Issuer shall have all of the benefits and
immunities (a) provided to the Administrative Agent in this Section 11 with
respect to any acts taken or omissions suffered by such L/C Issuer in connection
with Letters of Credit issued by it or proposed to be issued by it and the
Applications pertaining to such Letters of Credit as fully as if the term
"Administrative Agent", as used in this Section 11, included such L/C Issuer
with respect to such acts or omissions and (b) as additionally provided in this
Agreement with respect to such L/C Issuer.
Section 11.9. Hedging Agreements. By virtue of a Lender's execution of
this Agreement or an assignment agreement pursuant to Section 13.12 hereof, as
the case may be, any Affiliate of such Lender with whom the Borrower, or any
Subsidiary has entered into an agreement creating Hedging Liability shall be
deemed a Lender party hereto for purposes of any reference in a Loan Document to
the parties for whom the Administrative Agent is acting, it being understood and
agreed that the rights and benefits of such Affiliate under the Loan Documents
consist exclusively of such Affiliate's right to share in payments and
collections out of the Collateral and the guaranties as more fully set forth in
other provisions hereof.
Section 11.10. Designation of Additional Agents. The Administrative Agent
shall have the continuing right, for purposes hereof, at any time and from time
to time to designate one or more of the Lenders (and/or its or their Affiliates)
as "syndication agents", "documentation agents", "arrangers", or other
designations for purposes hereto, but such designation shall have no
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substantive effect, and such Lenders and their Affiliates shall have no
additional powers, duties, or responsibilities as a result thereof.
SECTION 12. THE GUARANTY.
Section 12.1. The Guaranty. To induce the Lenders to provide the
credits described herein and in consideration of benefits expected to accrue to
the Borrower by reason of the Commitments and for other good and valuable
consideration, receipt of which is hereby acknowledged, the Parent and each of
its direct and indirect Domestic Subsidiaries, except Renaissance (individually
each a "Guarantor" and collectively the "Guarantors"), hereby unconditionally
and irrevocably guarantee jointly and severally to the Administrative Agent, the
Lenders, and each other holder of any of the Obligations or Hedging Liability,
(x) the due and punctual payment of all present and future indebtedness of the
Borrower evidenced by or arising out of the Loan Documents, including, but not
limited to, the due and punctual payment of principal of and interest on the
Notes, the Reimbursement Obligations, and the due and punctual payment of all
other Obligations now or hereafter owed by the Borrower under the Loan Documents
as and when the same shall become due and payable, whether at stated maturity,
by acceleration or otherwise, according to the terms hereof and thereof, and (y)
the due and punctual payment of all present and future Hedging Liability as and
when the same shall become due and payable, whether at its stated maturity, by
acceleration or otherwise, according to the terms thereof, provided that the
Borrower shall not be understood to be a Guarantor of any Obligations or Hedging
Liability with respect to which it is the primary obligor. In case of failure by
the Borrower punctually to pay any indebtedness or other Obligations guaranteed
hereby (after giving effect to any applicable cure periods), each Guarantor
hereby unconditionally agrees jointly and severally to make such payment or to
cause such payment to be made punctually as and when the same shall become due
and payable, whether at stated maturity, by acceleration or otherwise, and as if
such payment were made by the Borrower.
Section 12.2. Guarantee Unconditional. The obligations of each
Guarantor as a guarantor under this Section 12 shall be unconditional and
absolute and, without limiting the generality of the foregoing, shall not be
released, discharged or otherwise affected by:
(a) any extension, renewal, settlement, compromise, waiver or
release in respect of any obligation of the Borrower or of any other
guarantor under this Agreement or any other Loan Document or by
operation of law or otherwise;
(b) any modification or amendment of or supplement to this
Agreement or any other Loan Document;
(c) any change in the corporate existence, structure or
ownership of, or any insolvency, bankruptcy, reorganization or other
similar proceeding affecting, the Borrower, any other guarantor, or
any of their respective assets, or any resulting release or
discharge of any obligation of the Borrower or of any other
guarantor contained in any Loan Document;
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(d) the existence of any claim, set-off or other rights which
the Borrower or any other guarantor may have at any time against the
Administrative Agent, any Lender or any other Person, whether or not
arising in connection herewith;
(e) any failure to assert, or any assertion of, any claim or
demand or any exercise of, or failure to exercise, any rights or
remedies against the Borrower, any other guarantor or any other
Person or Property;
(f) any application of any sums by whomsoever paid or
howsoever realized to any obligation of the Borrower, regardless of
what obligations of the Borrower remain unpaid;
(g) any invalidity or unenforceability relating to or against
the Borrower or any other guarantor for any reason of this Agreement
or of any other Loan Document or any provision of applicable law or
regulation purporting to prohibit the payment by the Borrower or any
other guarantor of the principal of or interest on any Note or any
Reimbursement Obligation or any other amount payable under the Loan
Documents; or
(h) any other act or omission to act or delay of any kind by
the Administrative Agent, any Lender or any other Person or any
other circumstance whatsoever that might, but for the provisions of
this paragraph, constitute a legal or equitable discharge of the
obligations of any Guarantor under this Section 12.
Section 12.3. Discharge Only Upon Payment in Full; Reinstatement in
Certain Circumstances. Each Guarantor's obligations under this Section 12 shall
remain in full force and effect until the Commitments are terminated, all
Letters of Credit have expired, and the principal of and interest on the Notes
and all other amounts payable by the Borrower under this Agreement and all other
Loan Documents shall have been paid in full. If at any time any payment of the
principal of or interest on any Note or any Reimbursement Obligation or any
other amount payable by the Borrower under the Loan Documents is rescinded or
must be otherwise restored or returned upon the insolvency, bankruptcy or
reorganization of the Borrower or of any guarantor, or otherwise, each
Guarantor's obligations under this Section 12 with respect to such payment shall
be reinstated at such time as though such payment had become due but had not
been made at such time.
Section 12.4. Subrogation. Each Guarantor agrees it will not exercise
any rights which it may acquire by way of subrogation by any payment made
hereunder, or otherwise, until all the Obligations shall have been paid in full
subsequent to the termination of all the Commitments and expiration of all
Letters of Credit. If any amount shall be paid to a Guarantor on account of such
subrogation rights at any time prior to the later of (x) the payment in full of
the Obligations and all other amounts payable by the Borrower hereunder and the
other Loan Documents and (y) the termination of the Commitments and expiration
of all Letters of Credit, such amount shall be held in trust for the benefit of
the Administrative Agent and the Lenders and shall forthwith be paid to the
Administrative Agent for the benefit of the Lenders or be credited and applied
upon the Obligations, whether matured or unmatured, in accordance with the terms
of this Agreement.
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Section 12.5. Waivers. Each Guarantor irrevocably waives acceptance
hereof, presentment, demand, protest and any notice not provided for herein, as
well as any requirement that at any time any action be taken by the
Administrative Agent, any Lender or any other Person against the Borrower,
another guarantor or any other Person.
Section 12.6. Limit on Recovery. Notwithstanding any other provision
hereof, the right of recovery against each Guarantor under this Section 12 shall
not exceed $1.00 less than the lowest amount which would render such Guarantor's
obligations under this Section 12 void or voidable under applicable law,
including without limitation fraudulent conveyance law.
Section 12.7. Stay of Acceleration. If acceleration of the time for
payment of any amount payable by the Borrower under this Agreement or any other
Loan Document is stayed upon the insolvency, bankruptcy or reorganization of the
Borrower, all such amounts otherwise subject to acceleration under the terms of
this Agreement or the other Loan Documents shall nonetheless be payable jointly
and severally by the Guarantors hereunder forthwith on demand by the
Administrative Agent made at the request of the Required Lenders.
SECTION 13. MISCELLANEOUS.
Section 13.1. Withholding Taxes. (a) Payments Free of Withholding.
Except as otherwise required by law and subject to Section 13.1(b) hereof, each
payment by the Borrower or any Guarantor under this Agreement or the other Loan
Documents shall be made without withholding for or on account of any present or
future taxes (other than overall net income taxes on the recipient) imposed by
or within the jurisdiction in which the Borrower or any Guarantor is domiciled,
any jurisdiction from which the Borrower or any Guarantor makes any payment, or
(in each case) any political subdivision or taxing authority thereof or therein.
If any such withholding is so required, the Borrower or any Guarantor shall make
the withholding, pay the amount withheld to the appropriate governmental
authority before penalties attach thereto or interest accrues thereon and
forthwith pay such additional amount as may be necessary to ensure that the net
amount actually received by each Lender and the Administrative Agent free and
clear of such taxes (including such taxes on such additional amount) is equal to
the amount which that Lender or the Administrative Agent (as the case may be)
would have received had such withholding not been made. If the Administrative
Agent or any Lender pays any amount in respect of any such taxes, penalties or
interest, the Borrower or any Guarantor shall reimburse the Administrative Agent
or such Lender for that payment on demand in the currency in which such payment
was made. If the Borrower or any Guarantor pays any such taxes, penalties or
interest, it shall deliver official tax receipts evidencing that payment or
certified copies thereof to the Lender or Administrative Agent on whose account
such withholding was made (with a copy to the Administrative Agent if not the
recipient of the original) on or before the thirtieth day after payment.
(b) U.S. Withholding Tax Exemptions. Each Lender that is not a
United States person (as such term is defined in Section 7701(a)(30) of the
Code) shall submit to the Borrower and the Administrative Agent on or before the
date the initial Credit Event is made hereunder or, if later, the date such
financial institution becomes a Lender hereunder, two duly completed and signed
copies of (i) either Form W-8 BEN (relating to such Lender and entitling it to a
complete
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exemption from withholding under the Code on all amounts to be received by such
Lender, including fees, pursuant to the Loan Documents and the Obligations) or
Form W-8 ECI (relating to all amounts to be received by such Lender, including
fees, pursuant to the Loan Documents and the Obligations) of the United States
Internal Revenue Service or (ii) solely if such Lender is claiming exemption
from United States withholding tax under Section 871(h) or 881(c) of the Code
with respect to payments of "portfolio interest", a Form W-8 BEN, or any
successor form prescribed by the Internal Revenue Service, and a certificate
representing that such Lender is not a bank for purposes of Section 881(c) of
the Code, is not a 10-percent shareholder (within the meaning of Section
871(h)(3)(B) of the Code) of the Borrower and is not a controlled foreign
corporation related to the Borrower (within the meaning of Section 864(d)(4) of
the Code). Thereafter and from time to time, each Lender shall submit to the
Borrower and the Administrative Agent such additional duly completed and signed
copies of one or the other of such Forms (or such successor forms as shall be
adopted from time to time by the relevant United States taxing authorities) and
such other certificates as may be (i) requested by the Borrower in a written
notice, directly or through the Administrative Agent, to such Lender and (ii)
required under then-current United States law or regulations to avoid or reduce
United States withholding taxes on payments in respect of all amounts to be
received by such Lender, including fees, pursuant to the Loan Documents or the
Obligations. Upon the request of the Borrower or the Administrative Agent, each
Lender that is a United States person (as such term is defined in Section
7701(a)(30) of the Code) shall submit to the Borrower and the Administrative
Agent a certificate to the effect that it is such a United States person.
(c) Inability of Lender to Submit Forms. If any Lender determines,
as a result of any change in applicable law, regulation or treaty, or in any
official application or interpretation thereof, that it is unable to submit to
the Borrower or the Administrative Agent any form or certificate that such
Lender is obligated to submit pursuant to subsection (b) of this Section 13.1 or
that such Lender is required to withdraw or cancel any such form or certificate
previously submitted or any such form or certificate otherwise becomes
ineffective or inaccurate, such Lender shall promptly notify the Borrower and
Administrative Agent of such fact and the Lender shall to that extent not be
obligated to provide any such form or certificate and will be entitled to
withdraw or cancel any affected form or certificate, as applicable.
Section 13.2. No Waiver, Cumulative Remedies. No delay or failure on
the part of the Administrative Agent or any Lender or on the part of the holder
or holders of any of the Obligations in the exercise of any power or right under
any Loan Document shall operate as a waiver thereof or as an acquiescence in any
default, nor shall any single or partial exercise of any power or right preclude
any other or further exercise thereof or the exercise of any other power or
right. The rights and remedies hereunder of the Administrative Agent, the
Lenders and of the holder or holders of any of the Obligations are cumulative
to, and not exclusive of, any rights or remedies which any of them would
otherwise have.
Section 13.3. Non-Business Days. If any payment hereunder becomes due
and payable on a day which is not a Business Day, the due date of such payment
shall be extended to the next succeeding Business Day on which date such payment
shall be due and payable. In the case of any payment of principal falling due on
a day which is not a Business Day, interest on such principal amount shall
continue to accrue during such extension at the rate per annum then in
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effect, which accrued amount shall be due and payable on the next scheduled date
for the payment of interest.
Section 13.4. Documentary Taxes. The Borrower agrees to pay on demand
any documentary, stamp or similar taxes payable in respect of this Agreement or
any other Loan Document, including interest and penalties, in the event any such
taxes are assessed, irrespective of when such assessment is made and whether or
not any credit is then in use or available hereunder.
Section 13.5. Survival of Representations. All representations and
warranties made herein or in any other Loan Document or in certificates given
pursuant hereto or thereto shall survive the execution and delivery of this
Agreement and the other Loan Documents, and shall continue in full force and
effect with respect to the date as of which they were made as long as any credit
is in use or available hereunder.
Section 13.6. Survival of Indemnities. All indemnities and other
provisions relative to reimbursement to the Lenders of amounts sufficient to
protect the yield of the Lenders with respect to the Loans and Letters of
Credit, including, but not limited to, Sections 1.12, 10.3 and 13.15 hereof,
shall survive the termination of this Agreement and the other Loan Documents and
the payment of the Obligations.
Section 13.7. Sharing of Set-Off. Each Lender agrees with each other
Lender a party hereto that if such Lender shall receive and retain any payment,
whether by set-off or application of deposit balances or otherwise, on any of
the Loans or Reimbursement Obligations in excess of its ratable share of
payments on all such Obligations then outstanding to the Lenders, then such
Lender shall purchase for cash at face value, but without recourse, ratably from
each of the other Lenders such amount of the Loans or Reimbursement Obligations,
or participations therein, held by each such other Lenders (or interest therein)
as shall be necessary to cause such Lender to share such excess payment ratably
with all the other Lenders; provided, however, that if any such purchase is made
by any Lender, and if such excess payment or part thereof is thereafter
recovered from such purchasing Lender, the related purchases from the other
Lenders shall be rescinded ratably and the purchase price restored as to the
portion of such excess payment so recovered, but without interest. For purposes
of this Section, amounts owed to or recovered by the L/C Issuer in connection
with Reimbursement Obligations in which Lenders have been required to fund their
participation shall be treated as amounts owed to or recovered by the L/C Issuer
as a Lender hereunder.
Section 13.8. Notices. Except as otherwise specified herein, all notices
hereunder and under the other Loan Documents shall be in writing (including,
without limitation, notice by telecopy) and shall be given to the relevant party
at its address or telecopier number set forth below, or such other address or
telecopier number as such party may hereafter specify by notice to the
Administrative Agent and the Borrower given by courier, by United States
certified or registered mail, by telecopy or by other telecommunication device
capable of creating a written record of such notice and its receipt. Notices
under the Loan Documents to the Lenders and the Administrative Agent shall be
addressed to their respective addresses or telecopier numbers set forth on the
signature pages hereof, and to the Borrower to:
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Florists' Transworld Delivery, Inc.
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Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy:
Attention: ▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Each such notice, request or other communication shall be effective (i) if given
by telecopier, when such telecopy is transmitted to the telecopier number
specified in this Section or on the signature pages hereof and a confirmation of
such telecopy has been received by the sender, (ii) if given by mail, 5 days
after such communication is deposited in the mail, certified or registered with
return receipt requested, addressed as aforesaid or (iii) if given by any other
means, when delivered at the addresses specified in this Section or on the
signature pages hereof; provided that any notice given pursuant to Section 1
hereof shall be effective only upon receipt.
Section 13.9. Counterparts. This Agreement may be executed in any
number of counterparts, and by the different parties hereto on separate
counterpart signature pages, and all such counterparts taken together shall be
deemed to constitute one and the same instrument.
Section 13.10. Successors and Assigns. This Agreement shall be binding
upon the Borrower and the Guarantors and their successors and assigns, and shall
inure to the benefit of the Administrative Agent and each of the Lenders and the
benefit of their respective successors and assigns, including any subsequent
holder of any of the Obligations. The Borrower and the Guarantors may not assign
any of their rights or obligations under any Loan Document without the written
consent of all of the Lenders.
Section 13.11. Participants. Each Lender shall have the right at its
own cost to grant participations (to be evidenced by one or more agreements or
certificates of participation) in the Loans made and Reimbursement Obligations
and/or Commitments held by such Lender at any time and from time to time to one
or more other Persons; provided that no such participation shall relieve any
Lender of any of its obligations under this Agreement, and, provided, further
that no such participant shall have any rights under this Agreement except as
provided in this Section, and the Administrative Agent shall have no obligation
or responsibility to such participant. Any agreement pursuant to which such
participation is granted shall provide that the granting Lender shall retain the
sole right and responsibility to enforce the obligations of the Borrower and the
Guarantors under this Agreement and the other Loan Documents including, without
limitation, the right to approve any amendment, modification or waiver of any
provision of the Loan Documents, except that such agreement may provide that
such Lender will not agree to any modification, amendment or waiver of the Loan
Documents that would reduce the amount of or postpone any fixed date for payment
of any Obligation in which such participant has an
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interest. Any party to which such a participation has been granted shall have
the benefits of Section 1.12 and Section 10.3 hereof. The Parent and the
Borrower authorize each Lender to disclose to any participant or prospective
participant under this Section any financial or other information pertaining to
the Parent, the Borrower or any other Subsidiary.
Section 13.12. Assignments. (a) Each Lender shall have the right at any
time, with the prior consent of the Administrative Agent and, so long as no
Event of Default then exists, the Borrower (which consent of the Borrower shall
not be unreasonably withheld) to sell, assign, transfer or negotiate all or any
part of its rights and obligations under the Loan Documents (including, without
limitation, the indebtedness evidenced by the Notes then held by such assigning
Lender, together with an equivalent percentage of its obligation to make Loans
and participate in Letters of Credit) to one or more commercial banks or other
financial institutions or investors, provided that, unless otherwise agreed to
by the Administrative Agent, such assignment shall be of a fixed percentage (and
not by its terms of varying percentage) of the assigning Lender's rights and
obligations under the Loan Documents; provided, however, that in order to make
any such assignment, (i) unless the assigning Lender is assigning all of its
Commitments, outstanding Loans and interests in Letters of Credit Obligations,
the assigning Lender shall retain at least $5,000,000 in unused Commitments,
outstanding Loans and interests in Letters of Credit, (ii) the assignee Lender
shall have Commitments, outstanding Loans and interests in Letters of Credit of
at least $5,000,000, (iii) each such assignment shall be evidenced by a written
agreement (substantially in the form attached hereto as Exhibit F or in such
other form acceptable to the Administrative Agent) executed by such assigning
Lender, such assignee Lender or Lenders, the Administrative Agent and, if
required as provided above, the Borrower, which agreement shall specify in each
instance the portion of the Obligations which are to be assigned to the assignee
Lender and the portion of the Commitments of the assigning Lender to be assumed
by the assignee Lender, (iv) the Swing Loans and Swing Line Commitment shall
only be assigned (if at all) in total and (v) the assigning Lender shall pay to
the Administrative Agent a processing fee of $3,500 and any out-of-pocket
attorneys' fees and expenses incurred by the Administrative Agent in connection
with any such assignment agreement. Any such assignee shall become a Lender for
all purposes hereunder to the extent of the rights and obligations under the
Loan Documents it assumes and the assigning Lender shall be released from its
obligations, and will have released its rights, under the Loan Documents to the
extent of such assignment. The address for notices to such assignee Lender shall
be as specified in the assignment agreement executed by it. Promptly upon the
effectiveness of any such assignment agreement, the Borrower shall execute and
deliver replacement Notes to the assignee Lender and the assigning Lender in the
respective amounts of their Commitments (or assigned principal amounts, as
applicable) after giving effect to the reduction occasioned by such assignment
(all such Notes to constitute "Notes" for all purposes of the Loan Documents),
and the assignee Lender shall thereafter surrender to the Borrower its old
Notes. The Borrower authorizes each Lender to disclose to any purchaser or
prospective purchaser of an interest in the Loans and interest in Letters of
Credit owed to it or its Commitments under this Section any financial or other
information pertaining to the Borrower or any Subsidiary.
(b) Any Lender may at any time pledge or grant a security interest
in all or any portion of its rights under this Agreement to secure obligations
of such Lender, including any such pledge or grant to a Federal Reserve Bank,
and this Section shall not apply to any such pledge or
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grant of a security interest; provided that no such pledge or grant of a
security interest shall release a Lender from any of its obligations hereunder
or substitute any such pledgee or secured party for such Lender as a party
hereto; provided further, however, that the right of any such pledgee or grantee
(other than any Federal Reserve Bank) to further transfer all or any portion of
the rights pledged or granted to it, whether by means of foreclosure or
otherwise, shall be at all times subject to the terms of this Agreement.
(c) Notwithstanding anything to the contrary contained herein, any
Lender (a "Designating Lender") may grant to one or more special purpose funding
vehicles (each, an "SPV"), identified as such in writing from time to time by
the Designating Lender to the Administrative Agent and the Borrower, the option
to provide to the Borrower all or any part of any Revolving Loan that such
Designating Lender would otherwise be obligated to make to the Borrower pursuant
to this Agreement; provided that (i) nothing herein shall constitute a
commitment by any SPV to make any Revolving Loan, (ii) if an SPV elects not to
exercise such option or otherwise fails to provide all or any part of such
Revolving Loan, the Designating Lender shall be obligated to make such Revolving
Loan pursuant to the terms hereof, and (iii) the Designating Lender shall remain
liable for any indemnity or any other payment or performance obligation with
respect to its Revolving Credit Commitment hereunder or with respect to any
Revolving Loan made by an SPV pursuant to an option to make such Revolving Loan
granted pursuant hereto. The making of a Revolving Loan by an SPV hereunder
shall utilize the Revolving Credit Commitment of the Designating Lender to the
same extent, and as if, such Revolving Loan were made by such Designating
Lender.
(d) As to any Revolving Loans or portions thereof made by it, each
SPV shall have all the rights that a Lender making such Revolving Loans or
portion thereof would have had under this Agreement; provided, however, that
each SPV shall have granted to its Designating Lender an irrevocable power of
attorney, to deliver and receive all communications and notices under this
Agreement (and any other Loan Documents) and to exercise on such SPV's behalf,
all of such SPV's voting rights under this Agreement. No additional Revolving
Credit Note shall be required to evidence the Revolving Loans or portion thereof
made by an SPV; and the related Designating Lender shall be deemed to hold its
Revolving Credit Note as agent for such SPV to the extent of the Revolving Loans
or portions thereof funded by such SPV. In addition, any payments for the
account of any SPV shall be paid to its Designating Lender as agent for such
SPV.
(e) Each party hereto hereby agrees that no SPV shall be liable for
any indemnity or payment under this Agreement for which a Lender would otherwise
be liable, provided that the Designating Lender which grants options to make
Revolving Loans to such SPV shall be liable for such amounts as set forth in
clause (c)(iii), above. In furtherance of the foregoing, each party hereto
hereby agrees (which agreements shall survive the termination of this Agreement)
that, prior to the date that is one year and one day after the payment in full
of all outstanding commercial paper or other senior indebtedness of any SPV, it
will not institute against, or join any other person in instituting against,
such SPV any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under the laws of the United States or any State thereof.
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(f) In addition, notwithstanding anything to the contrary contained
in this Section 13.12 or otherwise in this Agreement, any SPV may (i) at any
time and without paying any processing fee therefor, assign or participate all
or a portion of its interest in any Revolving Loans to the Designating Lender or
to any financial institutions providing liquidity and/or credit support to or
for the account of such SPV to support the funding or maintenance of Revolving
Loans and (ii) disclose on a confidential basis any non-public information
relating to its Revolving Loans to any rating agency, commercial paper dealer or
provider of any surety, guarantee or credit or liquidity enhancements to such
SPV.
Section 13.13. Amendments. Any provision of this Agreement or the other
Loan Documents may be amended or waived if, but only if, such amendment or
waiver is in writing and is signed by (a) the Borrower, (b) the Required
Lenders, and (c) if the rights or duties of the Administrative Agent are
affected thereby, the Administrative Agent; provided that:
(i) no amendment or waiver pursuant to this Section 13.13
shall (A) increase any Commitment of any Lender without the consent
of such Lender, (B) reduce the amount of or postpone the date for
payment of any principal of or interest on any Loan or of any
Reimbursement Obligation or of any fee payable hereunder without the
consent of the Lender to which such payment is owing or which has
committed to make such Loan or Letter of Credit (or participate
therein) hereunder, or (C) amend any provision of clauses (c), (d),
(e) or (f) of Section 13.12 hereof without the written consent of
any Designating Lender affected thereby; and
(ii) no amendment or waiver pursuant to this Section 13.13
shall, unless signed by each Lender, change the definitions of
Termination Date or Required Lenders, change the provisions of this
Section 13.13, release any material Guarantor or all or any
substantial part of the Collateral (except as otherwise provided for
in the Loan Documents), or affect the number of Lenders required to
take any action hereunder or under any other Loan Document.
Section 13.14. Headings. Section headings used in this Agreement are
for reference only and shall not affect the construction of this Agreement.
Section 13.15. Costs and Expenses; Indemnification. (a) The Borrower
agrees to pay all reasonable costs and expenses of the Administrative Agent in
connection with the preparation, negotiation, syndication, and administration of
the Loan Documents, including, without limitation, the reasonable fees and
disbursements of counsel to the Administrative Agent, in connection with the
preparation and execution of the Loan Documents, and any amendment, waiver or
consent related thereto, whether or not the transactions contemplated herein are
consummated, together with any reasonable fees and charges suffered or incurred
by the Administrative Agent in connection with periodic environmental audits,
fixed asset appraisals, title insurance policies, collateral filing fees and
lien searches. The Borrower further agrees to indemnify the Administrative
Agent, each Lender, and their respective directors, officers and employees,
against all losses, claims, damages, penalties, judgments, liabilities and
expenses (including, without limitation, all reasonable expenses of litigation
or preparation therefor, whether or not the indemnified Person is a party
thereto, or any settlement arrangement arising
-76-
from or relating to any such litigation) which any of them may pay or incur
arising out of or relating to any Loan Document or any of the transactions
contemplated thereby or the direct or indirect application or proposed
application of the proceeds of any Loan or Letter of Credit, other than those
which arise from the gross negligence or willful misconduct of the party
claiming indemnification. The Borrower, upon demand by the Administrative Agent
or a Lender at any time, shall reimburse the Administrative Agent or such Lender
for any legal or other expenses incurred in connection with investigating or
defending against any of the foregoing (including any settlement costs relating
to the foregoing) except if the same is directly due to the gross negligence or
willful misconduct of the party to be indemnified. The obligations of the
Borrower under this Section shall survive the termination of this Agreement.
(b) The Borrower unconditionally agrees to forever indemnify, defend
and hold harmless, and covenants not to ▇▇▇ for any claim for contribution
against, the Administrative Agent and the Lenders for any damages, costs, loss
or expense, including without limitation, response, remedial or removal costs,
arising out of any of the following: (i) any presence, release, threatened
release or disposal of any hazardous or toxic substance or petroleum by the
Borrower or any Subsidiary or otherwise occurring on or with respect to its
Property (whether owned or leased), (ii) the operation or violation of any
environmental law, whether federal, state, or local, and any regulations
promulgated thereunder, by the Borrower or any Subsidiary or otherwise occurring
on or with respect to its Property (whether owned or leased), (iii) any claim
for personal injury or property damage in connection with the Borrower or any
Subsidiary or otherwise occurring on or with respect to its Property (whether
owned or leased), and (iv) the inaccuracy or breach of any environmental
representation, warranty or covenant by the Borrower or any Subsidiary made
herein or in any other Loan Document evidencing or securing any Obligations or
setting forth terms and conditions applicable thereto or otherwise relating
thereto, except for damages arising from the willful misconduct or gross
negligence of the party claiming indemnification. This indemnification shall
survive the payment and satisfaction of all Obligations and the termination of
this Agreement, and shall remain in force beyond the expiration of any
applicable statute of limitations and payment or satisfaction in full of any
single claim under this indemnification. This indemnification shall be binding
upon the successors and assigns of the Borrower and shall inure to the benefit
of Administrative Agent and the Lenders directors, officers, employees, agents,
and collateral trustees, and their successors and assigns.
Section 13.16. Set-off. In addition to any rights now or hereafter
granted under applicable law and not by way of limitation of any such rights,
upon the occurrence of any Event of Default, each Lender and each subsequent
holder of any Obligation is hereby authorized by the Borrower and each Guarantor
at any time or from time to time, without notice to the Borrower or such
Guarantor or to any other Person, any such notice being hereby expressly waived,
to set-off and to appropriate and to apply any and all deposits (general or
special, including, but not limited to, indebtedness evidenced by certificates
of deposit, whether matured or unmatured, but not including trust accounts, and
in whatever currency denominated) and any other indebtedness at any time held or
owing by that Lender or that subsequent holder to or for the credit or the
account of the Borrower or such Guarantor, whether or not matured, against and
on account of the Obligations of the Borrower or such Guarantor to that Lender
or that subsequent holder under the Loan Documents, including, but not limited
to, all claims of any nature or description arising
-77-
out of or connected with the Loan Documents, irrespective of whether or not (a)
that Lender or that subsequent holder shall have made any demand hereunder or
(b) the principal of or the interest on the Loans or Notes and other amounts due
hereunder shall have become due and payable pursuant to Section 9 and although
said obligations and liabilities, or any of them, may be contingent or
unmatured.
Section 13.17. Entire Agreement. The Loan Documents constitute the
entire understanding of the parties thereto with respect to the subject matter
thereof and any prior agreements, whether written or oral, with respect thereto
are superseded hereby.
Section 13.18. Governing Law. This Agreement and the other Loan
Documents, and the rights and duties of the parties hereto, shall be construed
and determined in accordance with the internal laws of the State of Illinois.
Section 13.19. Severability of Provisions. Any provision of any Loan
Document which is unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction. All rights, remedies
and powers provided in this Agreement and the other Loan Documents may be
exercised only to the extent that the exercise thereof does not violate any
applicable mandatory provisions of law, and all the provisions of this Agreement
and other Loan Documents are intended to be subject to all applicable mandatory
provisions of law which may be controlling and to be limited to the extent
necessary so that they will not render this Agreement or the other Loan
Documents invalid or unenforceable.
Section 13.20. Excess Interest. Notwithstanding any provision to the
contrary contained herein or in any other Loan Document, no such provision shall
require the payment or permit the collection of any amount of interest in excess
of the maximum amount of interest permitted by applicable law to be charged for
the use or detention, or the forbearance in the collection, of all or any
portion of the Loans or other obligations outstanding under this Agreement or
any other Loan Document ("Excess Interest"). If any Excess Interest is provided
for, or is adjudicated to be provided for, herein or in any other Loan Document,
then in such event (a) the provisions of this Section shall govern and control,
(b) neither the Borrower nor any guarantor or endorser shall be obligated to pay
any Excess Interest, (c) any Excess Interest that the Administrative Agent or
any Lender may have received hereunder shall, at the option of the
Administrative Agent, be (i) applied as a credit against the then outstanding
principal amount of Obligations hereunder and accrued and unpaid interest
thereon (not to exceed the maximum amount permitted by applicable law), (ii)
refunded to the Borrower, or (iii) any combination of the foregoing, (d) the
interest rate payable hereunder or under any other Loan Document shall be
automatically subject to reduction to the maximum lawful contract rate allowed
under applicable usury laws (the "Maximum Rate"), and this Agreement and the
other Loan Documents shall be deemed to have been, and shall be, reformed and
modified to reflect such reduction in the relevant interest rate, and (e)
neither the Borrower nor any guarantor or endorser shall have any action against
the Administrative Agent or any Lender for any damages whatsoever arising out of
the payment or collection of any Excess Interest. Notwithstanding the foregoing,
if for any period of time interest on any of Borrower's Obligations is
calculated at the Maximum Rate
-78-
rather than the applicable rate under this Agreement, and thereafter such
applicable rate becomes less than the Maximum Rate, the rate of interest payable
on the Borrower's Obligations shall remain at the Maximum Rate until the Lenders
have received the amount of interest which such Lenders would have received
during such period on the Borrower's Obligations had the rate of interest not
been limited to the Maximum Rate during such period.
Section 13.21. Construction. Nothing contained herein shall be deemed
or construed to permit any act or omission which is prohibited by the terms of
any Collateral Document, the covenants and agreements contained herein being in
addition to and not in substitution for the covenants and agreements contained
in the Collateral Documents.
Section 13.22. Lender's Obligations Several. The obligations of the
Lenders hereunder are several and not joint. Nothing contained in this Agreement
and no action taken by the Lenders pursuant hereto shall be deemed to constitute
the Lenders a partnership, association, joint venture or other entity.
Section 13.23. Submission to Jurisdiction; Waiver of Jury Trial. The
Borrower and each Guarantor hereby submits to the nonexclusive jurisdiction of
the United States District Court for the Northern District of Illinois and of
any Illinois State court sitting in the City of Chicago for purposes of all
legal proceedings arising out of or relating to this Agreement, the other Loan
Documents or the transactions contemplated hereby or thereby. The Borrower and
each Guarantor irrevocably waives, to the fullest extent permitted by law, any
objection which it may now or hereafter have to the laying of the venue of any
such proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum. THE BORROWER,
EACH GUARANTOR, THE ADMINISTRATIVE AGENT AND EACH LENDER HEREBY IRREVOCABLY
WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF
OR RELATING TO ANY LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED THEREBY.
[SIGNATURE PAGES TO FOLLOW]
-79-
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their duly authorized officers, all as of the date
first above written.
BORROWER
FLORISTS' TRANSWORLD DELIVERY, INC.
By
---------------------------------------
Name
-----------------------------------
Title
----------------------------------
GUARANTORS
IOS BRANDS CORPORATION
By
---------------------------------------
Name
-----------------------------------
Title
----------------------------------
VALUE NETWORK SERVICE, INC.
By
---------------------------------------
Name
-----------------------------------
Title
----------------------------------
FTD HOLDINGS, INCORPORATED
By
---------------------------------------
Name
-----------------------------------
Title
----------------------------------
By
---------------------------------------
Name
-----------------------------------
Title
----------------------------------
-80-
FTD INTERNATIONAL CORPORATION
By
---------------------------------------
Name
-----------------------------------
Title
----------------------------------
-▇▇-
▇▇▇▇▇▇▇
▇▇▇▇▇▇ TRUST AND SAVINGS BANK, in its
individual capacity as a Lender and as
Administrative Agent
By
---------------------------------------
Name
-----------------------------------
Title
----------------------------------
Address:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. Law
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
U.S. BANK NATIONAL ASSOCIATION
By
---------------------------------------
Name
-----------------------------------
Title
----------------------------------
Address:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Mail Drop MK-FC-GLCB
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
-82-
KEY BANK, N.A.
By
---------------------------------------
Name
-----------------------------------
Title
----------------------------------
Address:
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
MICHIGAN NATIONAL BANK
By
---------------------------------------
Name
-----------------------------------
Title
----------------------------------
Address:
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
-83-
EXHIBIT A
NOTICE OF PAYMENT REQUEST
[Date]
[Name of Lender]
[Address]
Attention:
Reference is made to the Credit Agreement, dated as of September 27,
2001, among Florists' Transworld Delivery, Inc., the Guarantors, the Lenders
party thereto, and ▇▇▇▇▇▇ Trust and Savings Bank, as Administrative Agent (the
"Credit Agreement"). Capitalized terms used herein and not defined herein have
the meanings assigned to them in the Credit Agreement. [The Borrower has failed
to pay its Reimbursement Obligation in the amount of $____________. Your
Revolver Percentage of the unpaid Reimbursement Obligation is $_____________] or
[__________________________ has been required to return a payment by the
Borrower of a Reimbursement Obligation in the amount of $_______________. Your
Revolver Percentage of the returned Reimbursement Obligation is
$_______________.]
Very truly yours,
▇▇▇▇▇▇ TRUST AND SAVINGS BANK, as L/C
Issuer
By
-----------------------------------
Name
-------------------------------
Title
------------------------------
EXHIBIT B
NOTICE OF BORROWING
Date: ____________, ____
To: ▇▇▇▇▇▇ Trust and Savings Bank, as Administrative Agent for the Lenders
parties to the Credit Agreement dated as of September 27, 2001 (as
extended, renewed, amended or restated from time to time, the "Credit
Agreement"), among Florists' Transworld Delivery, Inc., the Guarantors,
certain Lenders which are signatories thereto, and ▇▇▇▇▇▇ Trust and
Savings Bank, as Administrative Agent
Ladies and Gentlemen:
The undersigned, Florists' Transworld Delivery, Inc. (the "Borrower"),
refers to the Credit Agreement, the terms defined therein being used herein as
therein defined, and hereby gives you notice irrevocably, pursuant to Section
1.5 of the Credit Agreement, of the Borrowing specified below:
1. The Business Day of the proposed Borrowing is ___________,
____.
2. The aggregate amount of the proposed Borrowing is
$______________.
3. The Borrowing is being advanced under the Revolving Credit.
4. The Borrowing is to be comprised of $___________ of [Base
Rate] [Eurodollar] Loans.
[5. The duration of the Interest Period for the Eurodollar Loans
included in the Borrowing shall be ____________ months.]
The undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the date of the proposed Borrowing,
before and after giving effect thereto and to the application of the proceeds
therefrom:
(a) the representations and warranties of the Borrower contained
in Section 6 of the Credit Agreement are true and correct as though
made on and as of such date (except to the extent such representations
and warranties relate to an earlier date, in which case they are true
and correct as of such date); and
(b) no Default or Event of Default has occurred and is continuing
or would result from such proposed Borrowing.
FLORISTS' TRANSWORLD DELIVERY, INC.
By
-----------------------------------
Name
-------------------------------
Title
------------------------------
EXHIBIT C
NOTICE OF CONTINUATION/CONVERSION
Date: ____________, 20__
To: ▇▇▇▇▇▇ Trust and Savings Bank, as Administrative Agent for the Lenders
parties to the Credit Agreement dated as of September 27, 2001 (as
extended, renewed, amended or restated from time to time, the "Credit
Agreement"), among Florists' Transworld Delivery, Inc., the Guarantors,
certain Lenders which are signatories thereto, and ▇▇▇▇▇▇ Trust and
Savings Bank, as Administrative Agent
Ladies and Gentlemen:
The undersigned, Florists' Transworld Delivery, Inc. (the "Borrower"),
refers to the Credit Agreement, the terms defined therein being used herein as
therein defined, and hereby gives you notice irrevocably, pursuant to Section
1.5 of the Credit Agreement, of the [conversion] [continuation] of the Loans
specified herein, that:
1. The conversion/continuation Date is __________, ____.
2. The aggregate amount of the Revolving Loans to be [converted]
[continued] is $______________.
3. The Loans are to be [converted into] [continued as]
[Eurodollar] [Base Rate] Loans.
4. [If applicable:] The duration of the Interest Period for the
Revolving Loans included in the [conversion] [continuation] shall be
_________ months.
The undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the proposed conversion/continuation
date, before and after giving effect thereto and to the application of the
proceeds therefrom:
(a) the representations and warranties of the Borrower contained
in Section 6 of the Credit Agreement are true and correct as though
made on and as of such date (except to the extent such representations
and warranties relate to an earlier date, in which case they are true
and correct as of such date); provided, however, that this condition
shall not apply to the conversion of an outstanding Eurodollar Loan to
a Base Rate Loan; and
(b) no Default or Event of Default has occurred and is
continuing, or would result from such proposed [conversion]
[continuation].
FLORISTS' TRANSWORLD DELIVERY, INC.
By
-----------------------------------
Name
-------------------------------
Title
------------------------------
EXHIBIT D-1
REVOLVING NOTE
U.S. $_______________ September 27, 2001
FOR VALUE RECEIVED, the undersigned, Florists' Transworld Delivery,
Inc., a Michigan corporation (the "Borrower"), hereby promises to pay to the
order of ____________________ (the "Lender") on the Termination Date of the
hereinafter defined Credit Agreement, at the principal office of ▇▇▇▇▇▇ Trust
and Savings Bank, as Administrative Agent, in Chicago, Illinois, in immediately
available funds, the principal sum of _______________________ Dollars
($__________) or, if less, the aggregate unpaid principal amount of all
Revolving Loans made by the Lender to the Borrower pursuant to the Credit
Agreement, together with interest on the principal amount of each Revolving Loan
from time to time outstanding hereunder at the rates, and payable in the manner
and on the dates, specified in the Credit Agreement.
This Note is one of the Revolving Notes referred to in the Credit
Agreement dated as of September 27, 2001, among the Borrower, the Guarantors,
▇▇▇▇▇▇ Trust and Savings Bank, as Administrative Agent and the Lenders party
thereto (the "Credit Agreement"), and this Note and the holder hereof are
entitled to all the benefits and security provided for thereby or referred to
therein, to which Credit Agreement reference is hereby made for a statement
thereof. All defined terms used in this Note, except terms otherwise defined
herein, shall have the same meaning as in the Credit Agreement. This Note shall
be governed by and construed in accordance with the internal laws of the State
of Illinois.
Voluntary prepayments may be made hereon, certain prepayments are
required to be made hereon, and this Note may be declared due prior to the
expressed maturity hereof, all in the events, on the terms and in the manner as
provided for in the Credit Agreement.
The Borrower hereby waives demand, presentment, protest or notice of
any kind hereunder.
FLORISTS' TRANSWORLD DELIVERY, INC.
By
-----------------------------------
Name
-------------------------------
Title
------------------------------
EXHIBIT D-2
SWING LINE NOTE
September 27, 2001
FOR VALUE RECEIVED, the undersigned, Florists' Transworld Delivery,
Inc., a Michigan corporation (the "Borrower"), hereby promises to pay to the
order of ▇▇▇▇▇▇ Trust and Savings Bank (the "Lender") on the Termination Date of
the hereinafter defined Credit Agreement, at the principal office of ▇▇▇▇▇▇
Trust and Savings Bank, as Administrative Agent, in Chicago, Illinois, in
immediately available funds, an amount equal to the aggregate unpaid principal
amount of all Swing Loans made by the Lender to the Borrower pursuant to the
Credit Agreement, together with interest on the principal amount of each Swing
Loan from time to time outstanding hereunder at the rates, and payable in the
manner and on the dates, specified in the Credit Agreement.
This Note is the Swing Line Note referred to in the Credit Agreement
dated as of September 27, 2001, among the Borrower, the Guarantors, ▇▇▇▇▇▇ Trust
and Savings Bank, as Administrative Agent and the Lenders party thereto (the
"Credit Agreement"), and this Note and the holder hereof are entitled to all the
benefits and security provided for thereby or referred to therein, to which
Credit Agreement reference is hereby made for a statement thereof. All defined
terms used in this Note, except terms otherwise defined herein, shall have the
same meaning as in the Credit Agreement. This Note shall be governed by and
construed in accordance with the internal laws of the State of Illinois.
Voluntary prepayments may be made hereon, certain prepayments are
required to be made hereon, and this Note may be declared due prior to the
expressed maturity hereof, all in the events, on the terms and in the manner as
provided for in the Credit Agreement.
The Borrower hereby waives demand, presentment, protest or notice of
any kind hereunder.
FLORISTS' TRANSWORLD DELIVERY, INC.
By
-----------------------------------
Name
-------------------------------
Title
------------------------------
EXHIBIT E
FLORISTS' TRANSWORLD DELIVERY, INC.
COMPLIANCE CERTIFICATE
To: ▇▇▇▇▇▇ Trust and Savings Bank, as
Administrative Agent under, and the Lenders
party to, the Credit Agreement described below
This Compliance Certificate is furnished to the Administrative Agent
and the Lenders pursuant to that certain Credit Agreement dated as of September
27, 2001 among Florists' Transworld Delivery, Inc., IOS Brands Corporation, the
Guarantors party thereto, the Lenders and yourselves, as Administrative Agent
for the Lenders (the "Credit Agreement"). Unless otherwise defined herein, the
terms used in this Compliance Certificate have the meanings ascribed thereto in
the Credit Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected ____________ of Florists' Transworld Delivery,
Inc.;
2. I have reviewed the terms of the Credit Agreement and I have made,
or have caused to be made under my supervision, a detailed review of the
transactions and conditions of the Parent, the Borrower and the Subsidiaries
[and ▇▇▇.▇▇▇] during the accounting period covered by the attached financial
statements;
3. The examinations described in paragraph 2 did not disclose, and I
have no knowledge of, the existence of any condition or the occurrence of any
event which constitutes a Default or Event of Default during or at the end of
the accounting period covered by the attached financial statements or as of the
date of this Compliance Certificate, except as set forth below;
4. The financial statements required by Section 8.5 of the Credit
Agreement and being furnished to you concurrently with this Compliance
Certificate are true, correct and complete as of the date and for the periods
covered thereby; and
5. The Schedule I hereto sets forth financial data and computations
evidencing the Borrower's compliance with certain covenants of the Credit
Agreement, all of which data and computations are, to the best of my knowledge,
true, complete and correct and have been made in accordance with the relevant
Sections of the Credit Agreement.
Described below are the exceptions, if any, to paragraph 3 by listing,
in detail, the nature of the condition or event, the period during which it has
existed and the action which the Borrower has taken, is taking, or proposes to
take with respect to each such condition or event:
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The foregoing certifications, together with the computations set forth
in Schedule I hereto and the financial statements delivered with this
Certificate in support hereof, are made and delivered this ______ day of
__________________, 20___.
FLORISTS' TRANSWORLD DELIVERY, INC.
By
-----------------------------------
Name
-------------------------------
Title
------------------------------
-2-
SCHEDULE I
TO COMPLIANCE CERTIFICATE
FLORISTS' TRANSWORLD DELIVERY, INC.
COMPLIANCE CALCULATIONS
FOR CREDIT AGREEMENT DATED AS OF SEPTEMBER 27, 2001
CALCULATIONS AS OF _____________, 20___
================================================================================
A. Total Funded Debt to EBITDA (Section 8.22)
1. Total Funded Debt $___________
2. Net Income for past 4 quarters $___________
3. Interest Expense for past 4 quarters $___________
4. Income taxes for past 4 quarters $___________
5. Depreciation and Amortization Expense for past 4 quarters $___________
6. Plus/minus extraordinary non-cash losses/gains $___________
7. Other adjustments (see definition of EBITDA) $___________
8. Sum of Lines A2, A3, A4, A5, A6 and A7 ("EBITDA") $___________
9. Ratio of Line A1 to A8 ____: 1.0
10. Line A9 ratio must not exceed ____: 1.0
11. The Parent is in compliance (circle yes or no) yes/no
B. Consolidated Net Worth (Section 8.23(a))
1. Consolidated Net Worth $___________
2. Line B1 shall not be less than $___________
3. The Parent is in compliance (circle yes or no) yes/no
C. Net Worth of ▇▇▇.▇▇▇ (Section 8.23(b))
1. Net Worth $___________
2. Line C1 shall not be less than $0.00
3. ▇▇▇.▇▇▇ is in compliance (circle yes or no) yes/no
D. Fixed Charge Coverage Ratio (Section 8.24)
1. EBITDA (Line A8 above), less Capital Expenditures $___________
2. Principal payments for past 4 quarters $___________
3. Income taxes for past 4 quarters (annualized, if applicable, per
definition of "Fixed Charges") $___________
4. Interest Expense for past 4 quarters $___________
5. Restricted Payments for past 4 quarters $___________
6. Sum of Lines D2, D3, D4 and D5 $___________
7. Ratio of Line D1 to Line D6 ____: 1.0
8. Line D7 ratio must not be less than ____: 1.0
9. The Parent is in compliance (circle yes or no) yes/no
-2-
EXHIBIT F
ASSIGNMENT AND ACCEPTANCE
Dated _____________, 20_____
Reference is made to the Credit Agreement dated as of September 27,
2001 (the "Credit Agreement") among Florists' Transworld Delivery, Inc., the
Guarantors, the Lenders (each as defined in the Credit Agreement) and ▇▇▇▇▇▇
Trust and Savings Bank, as Administrative Agent for the Lenders (the
"Administrative Agent"). Terms defined in the Credit Agreement are used herein
with the same meaning.
______________________________________________________ (the "Assignor")
and _________________________ (the "Assignee") agree as follows:
1. The Assignor hereby sells and assigns to the Assignee,
and the Assignee hereby purchases and assumes from the Assignor, a
_______% interest in and to all of the Assignor's rights and
obligations under the Credit Agreement as of the Effective Date (as
defined below), including, without limitation, such percentage interest
in the Assignor's Commitments as in effect on the Effective Date and
the Loans, if any, owing to the Assignor on the Effective Date and the
Assignor's Percentage of any outstanding L/C Obligations.
2. The Assignor (i) represents and warrants that as of the
date hereof (A) its Revolving Credit Commitment is $_______________,
(B) the aggregate outstanding principal amount of Loans made by it
under the Credit Agreement that have not been repaid is $___________
and a description of the interest rates and interest periods of such
Loans is attached as Annex 1 hereto, and (C) the aggregate principal
amount of Assignor's Percentage of outstanding L/C Obligations is
$___________; (ii) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and
that such interest is free and clear of any adverse claim, lien, or
encumbrance of any kind; (iii) makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement or
the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Credit Agreement or any other instrument or
document furnished pursuant thereto; and (iv) makes no representation
or warranty and assumes no responsibility with respect to the financial
condition of the Borrower or any Subsidiary or the performance or
observance by the Borrower or any Subsidiary of any of their respective
obligations under the Credit Agreement or any other instrument or
document furnished pursuant thereto.
3. The Assignee (i) confirms that it has received a copy of
the Credit Agreement, together with copies of the most recent financial
statements delivered to the Lenders pursuant to Section 8.5(a) and (b)
thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to
enter into this Assignment and Acceptance; (ii) agrees that it will,
independently and without reliance upon the Administrative Agent, the
Assignor or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make
its own credit decisions in taking or not taking action under the
Credit Agreement; (iii) appoints and authorizes the Administrative
Agent to take such action as Administrative Agent on its behalf and to
exercise such powers under the Credit Agreement and the other Loan
Documents as are delegated to the Administrative Agent by the terms
thereof, together with such powers as are reasonably incidental
thereto; (iv) agrees that it will perform in accordance with their
terms all of the obligations which by the terms of the Credit Agreement
are required to be performed by it as a Lender; and (v) specifies as
its lending office (and address for notices) the offices set forth
beneath its name on the signature pages hereof.
4. As consideration for the assignment and sale contemplated
in Annex 1 hereof, the Assignee shall pay to the Assignor on the
Effective Date in Federal funds an amount equal to
$________________(*). It is understood that commitment and/or letter of
credit fees accrued to the Effective Date with respect to the interest
assigned hereby are for the account of the Assignor and such fees
accruing from and including the date hereof are for the account of the
Assignee. Each of the Assignor and the Assignee hereby agrees that if
it receives any amount under the Credit Agreement which is for the
account of the other party hereto, it shall receive the same for the
account of such other party to the extent of such other party's
interest therein and shall promptly pay the same to such other party.
5. The effective date for this Assignment and Acceptance
shall be ___________, 20___ (the "Effective Date"). Following the
execution of this Assignment and Acceptance, it will be delivered to
the Administrative Agent for acceptance and recording by the
Administrative Agent and, if required, the relevant Borrower.
6. Upon such acceptance and recording, as of the Effective
Date, (i) the Assignee shall be a party to the Credit Agreement and, to
the extent provided in this Assignment and Acceptance, have the rights
and obligations of a Lender thereunder and (ii) the Assignor shall, to
the extent provided in this Assignment and Acceptance, relinquish its
rights and be released from its obligations under the Credit Agreement.
7. Upon such acceptance and recording, from and after the
Effective Date, the Administrative Agent shall make all payments under
the Credit Agreement in respect of the interest assigned hereby
(including, without limitation, all payments of principal, interest and
commitment fees with respect thereto) to the Assignee. The Assignor and
Assignee shall make all appropriate adjustments in payments under the
Credit Agreement for periods prior to the Effective Date directly
between themselves.
--------
(*) Amount should combine principal together with accrued interest and breakage
compensation, if any, to be paid by the Assignee, net of any portion of any
upfront fee to be paid by the Assignor to the Assignee. It may be preferable
in an appropriate case to specify these amounts generically or by formula
rather than as a fixed sum.
-2-
8. In accordance with Section 13.12 of the Credit Agreement,
the Assignor and the Assignee request and direct that the
Administrative Agent prepare and cause the Borrower to execute and
deliver to the Assignee the relevant Notes payable to the Assignee in
the amount of its Commitments and new Notes to the Assignor in the
amount of its Commitments after giving effect to this assignment.
9. This Assignment and Acceptance shall be governed by, and
construed in accordance with, the laws of the State of Illinois.
[Assignor Lender]
By
-----------------------------------
Name
-------------------------------
Title
------------------------------
[Assignee Lender]
By
-----------------------------------
Name
-------------------------------
Title
------------------------------
Lending office (and address for notices):
Accepted and consented this
____ day of _________, 2001
FLORISTS' TRANSWORLD DELIVERY, INC.
By
-----------------------------------
Name
-------------------------------
Title
------------------------------
Accepted and consented to by the Administrative Agent this
_______ day of ____________, 2001
▇▇▇▇▇▇ TRUST AND SAVINGS BANK,
as Administrative Agent
By
-----------------------------------
Name
-------------------------------
Title
------------------------------
-3-
ANNEX I
TO ASSIGNMENT AND ACCEPTANCE
PRINCIPAL AMOUNT TYPE OF LOAN INTEREST RATE MATURITY DATE
EXHIBIT G
ADDITIONAL GUARANTOR SUPPLEMENT
______________, ___
▇▇▇▇▇▇ TRUST AND SAVINGS BANK, as
Administrative Agent for the Lenders
named in the Credit Agreement dated
as of September 27, 2001, among
Florists' Transworld Delivery, Inc.,
as Borrower, the Guarantors referred
to therein, the Lenders from time to
time party thereto, and the
Administrative Agent (the "Credit
Agreement")
Ladies and Gentlemen:
Reference is made to the Credit Agreement described above. Terms not
defined herein which are defined in the Credit Agreement shall have for the
purposes hereof the meaning provided therein.
The undersigned, [NAME OF SUBSIDIARY GUARANTOR], a [JURISDICTION OF
INCORPORATION OR ORGANIZATION] hereby elects to be a "Guarantor" for all
purposes of the Credit Agreement, effective from the date hereof. The
undersigned confirms that the representations and warranties set forth in
Section 6 of the Credit Agreement are true and correct as to the undersigned as
of the date hereof.
Without limiting the generality of the foregoing, the undersigned
hereby agrees to perform all the obligations of a Guarantor under, and to be
bound in all respects by the terms of, the Credit Agreement, including without
limitation Section 12 thereof, to the same extent and with the same force and
effect as if the undersigned were a signatory party thereto.
This Agreement shall be construed in accordance with and governed by
the internal laws of the State of Illinois.
Very truly yours,
[NAME OF SUBSIDIARY GUARANTOR]
By
-----------------------------------
Name
-------------------------------
Title
------------------------------
SCHEDULE 1
COMMITMENTS
REVOLVING CREDIT REVOLVING CREDIT REVOLVING CREDIT REVOLVING CREDIT
COMMITMENT FROM AND COMMITMENT FROM AND COMMITMENT FROM AND COMMITMENT FROM AND
INCLUDING THE DATE INCLUDING JUNE 30, 2002 INCLUDING JUNE 30, 2003 INCLUDING JUNE 30,
HEREOF THROUGH AND THROUGH AND INCLUDING THROUGH AND INCLUDING 2004 AND AT ALL
NAME OF LENDER INCLUDING JUNE 29, 2002 JUNE 29, 2003 JUNE 29, 2004 TIMES THEREAFTER
▇▇▇▇▇▇ Trust and $25,000,000 $23,437,500 $20,312,500 $17,187,500
Savings Bank
U.S. Bank National $20,000,000 $18,750,000 $16,250,000 $13,750,000
Association
Key Bank, N.A. $20,000,000 $18,750,000 $16,250,000 $13,750,000
Michigan National Bank $15,000,000 $14,062,500 $12,187,500 $10,312,500
Total $80,000,000 $75,000,000 $65,000,000 $55,000,000
SCHEDULE 1.2
EXISTING LETTERS OF CREDIT
SCHEDULE 6.2
SUBSIDIARIES
JURISDICTION OF PERCENTAGE
NAME ORGANIZATION OWNERSHIP OWNER
Florists' Transworld Michigan 100% IOS BRANDS Corporation
Delivery, Inc.
Florists' Transworld Delivery Ontario, 100% Florists' Transworld
Association of Canada Limited Canada Delivery, Inc.
Value Network Service, Inc. Delaware 100% IOS BRANDS Corporation
FTD Holdings, Incorporated Delaware 100% Florists' Transworld
Delivery, Inc.
▇▇▇.▇▇▇ INC. Delaware 83%* Florists' Transworld
Delivery, Inc.
Florists Transworld Delivery Mexico, D.F. 100% FTD International
de Mexico, S. de ▇.▇. de C.V. Corporation
FTD International Corporation Delaware 100% IOS BRANDS Corporation
Renaissance Greeting Cards, Inc. Maine 100% FTD Holdings, Incorporated
▇▇▇.▇▇▇ has issued shares of Class A and Class B Common Stock. Shares
of Class A Common Stock are entitled to one vote on each matter to be voted on
at a meeting of shareholders and shares of Class B Common Stock are entitled to
ten votes on each matter be voted on at a meeting of shareholders. The shares
owned by Florists' Transworld Delivery, Inc. are shares of Class B Common Stock.
As of the close of business on September 24, 2001, there were 8,206,743 shares
of Class A Common Stock and 40,395,000 shares of Class B Common Stock
outstanding.
SCHEDULE 8.7
PERMITTED EXISTING INDEBTEDNESS
Reimbursement obligations of the Borrower to Bank One, NA with respect to four
standby letters of credit in an aggregate stated amount of $1,200,000 (the "Bank
One LCs"). The Bank One LCs were, prior to the execution of the Credit
Agreement, replaced by letters of credit issued by Michigan National Bank and
shown on Schedule 1.2 hereof. As soon as the beneficiaries of the Bank One LCs
return them to Bank One, all reimbursement obligations of the Borrower with
respect to the Bank One LCs will be terminated. The Borrower has agreed to cause
this to happen within 30 days of the Closing Date.
SCHEDULE 8.8
PERMITTED EXISTING LIENS
DEBTOR: FLORISTS TRANSWORLD DELIVERY, INC.
Jurisdiction Indices Date File No. Secured Party Collateral/Comments
------------ ------- ---- -------- ------------- -------------------
ILLINOIS
Sec. of State UCC 2/11/99 3988170 Varilease Corporation Equipment lease
through 8/16/01 2/22/99 3992497
3/23/99 4009103
UCC 5/10/99 4033029 Fleet Business Credit Assignment of Varilease
ASSIGN Corporation file #4009103
UCC 9/02/99 4089328 Dell Financial Services, Equipment lease
N.A.
UCC 10/04/99 4103200 General Electric Capital Equipment lease
Corporation
UCC 6/23/00 4231116 Hewlett-Packard Company Equipment lease
7/27/00 4244610
12/08/00 4308647
12/11/00 4309437
12/21/00 4314019
1/24/01 4329137
1/24/01 4329140
4/09/01 4367318
MICHIGAN
Sec. of State UCC 1/12/01 20756C Hewlett-Packard Company Equipment lease
through 8/22/01
OHIO
Sec. of State UCC 12/16/00 AP307591 Hewlett-Packard Company Equipment lease
through 6/15/01
Hewlett-Packard Company
UCC 12/21/00 AP301693 Equipment lease
The Lien of Bank One, NA on a deposit account of the Borrower with Bank
One, NA securing the Borrower's reimbursement obligations with respect
to the Bank One LCs described in Schedule 8.7.
SCHEDULE 8.9
PERMITTED EXISTING INVESTMENTS
A. IOS Brands Corporation
None
B. Florists' Transworld Delivery, Inc.
1. Holds a 33% interest in Interflora, Inc.
2. Officer Note - ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ dated November 11, 1998. Principal
balance outstanding at September 21, 2001 is $200,000.
3. Officer Note - ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ dated October 29, 1999. Principal
balance outstanding at September 21, 2001 is $108,000.
4. Officer Note - ▇▇▇▇ ▇▇▇▇▇▇ dated August 22, 2000. Principal
balance outstanding at September 21, 2001 is $100,000.
5. Officer Note - ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ dated October 30, 2000. Principal
balance outstanding at September 21, 2001 is $94,000.
6. Officer Note - ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ dated October 30, 2000.
Principal balance outstanding at September 21, 2001 is $47,000.
7. Officer Note - ▇▇▇▇ ▇▇▇▇▇▇▇ dated October 30, 2000. Principal
balance outstanding at September 21, 2001 is $47,000.
8. Officer Note - ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ dated June 12, 2001. Principal
balance outstanding at September 21, 2001 is $308,000.
9. Officer Note - ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ dated June 12, 2001.
Principal balance outstanding at September 21, 2001 is $88,000.
10. Officer Note - ▇▇▇ ▇▇▇▇▇▇▇▇▇ dated June 12, 2001. Principal
balance outstanding at September 21, 2001 is $66,000.
11. Officer Note - ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ dated July 1, 2001. Principal
balance outstanding at September 21, 2001 is $47,000.
12. Officer Note - ▇▇▇▇ ▇▇▇▇▇▇▇ dated July 1, 2001. Principal balance
outstanding at September 21, 2001 is $47,000.
C. Florists' Transworld Delivery Association of Canada, LTD.
None
D. Value Network Service, Inc.
None
E. FTD Holdings, Incorporated
None
F. Florists' Transworld Delivery de Mexico, S. de ▇.▇. de C.V.
None
G. FTD International Corporation
None
H. Renaissance Greeting Cards, Inc.
None