EXHIBIT 10.1
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CREDIT AGREEMENT
among
SCOTSMAN HOLDINGS, INC.,
▇▇▇▇▇▇▇▇ SCOTSMAN, INC.,
VARIOUS FINANCIAL INSTITUTIONS,
BANKERS TRUST COMPANY,
as Administrative Agent,
FLEET CAPITAL CORPORATION and CONGRESS FINANCIAL CORPORATION,
as Co-Syndication Agents,
BANK OF AMERICA, N.A. and GMAC BUSINESS CREDIT, LLC,
as Co-Documentation Agents,
and
DEUTSCHE BANC ALEX. ▇▇▇▇▇ INC.,
as Sole Lead Arranger and Sole Book Manager
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Dated as of March 26, 2002
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THIS CREDIT AGREEMENT, dated as of March 26, 2002, among SCOTSMAN
HOLDINGS, INC., a Delaware corporation ("Holdings"), ▇▇▇▇▇▇▇▇ SCOTSMAN, INC., a
Maryland corporation (the "BORROWER"), the Lenders party hereto from time to
time, BANKERS TRUST COMPANY, as Administrative Agent (in such capacity, the
"ADMINISTRATIVE AGENT"), FLEET CAPITAL CORPORATION and CONGRESS FINANCIAL
CORPORATION, as Co-Syndication Agents (in such capacities, each, a
"CO-SYNDICATION AGENT" and, collectively, the "CO-SYNDICATION AGENTS"), BANK OF
AMERICA, N.A. and GMAC BUSINESS CREDIT, LLC, as Co-Documentation Agents (in such
capacities, each a "CO-DOCUMENTATION AGENT" and, collectively, the
"CO-DOCUMENTATION AGENTS"), and DEUTSCHE BANC ALEX. ▇▇▇▇▇ INC., as Sole Lead
Arranger and Sole Book Manager (in such capacity, the "LEAD ARRANGER").
Capitalized terms used and not otherwise defined herein have the respective
meanings set forth in Section 1.1 hereof.
W I T N E S S E T H :
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WHEREAS, subject to and upon the terms and conditions set forth herein,
the Lenders are willing to make available to the Borrower the credit facilities
provided for herein;
NOW, THEREFORE, the parties hereto hereby agree as follows:
ARTICLE 1
DEFINITIONS
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1.1 GENERAL DEFINITIONS. As used herein, the following terms shall
have the meanings herein specified (to be equally applicable to both the
singular and plural forms of the terms defined):
ACCOUNTS shall mean, with respect to any Person, all present and future
accounts, contract rights and other rights to payment for goods sold or leased
(whether or not delivered) or for services rendered which are not evidenced by
an instrument, whether or not they have been earned by performance, and any
letter of credit, guarantee, security interest or other security issued or
granted to secure payment by an account debtor including, without limitation,
all rentals, lease payments and other monies earned and to be earned, due and to
become due under any Lease.
ADJUSTED EURODOLLAR RATE shall mean, with respect to each Interest
Period for any Eurodollar Rate Loan, the rate obtained by dividing (i) the
Eurodollar Rate for such Interest Period by (ii) a percentage equal to 100%
MINUS the stated maximum rate (stated as a decimal) of all reserves, if any,
required by the Board of Governors of the Federal Reserve System to be
maintained by a member bank of the Federal Reserve System in New York City with
deposits in excess of five billion dollars against "Eurocurrency liabilities" as
specified in Regulation D (or against any other category of liabilities which
includes deposits by reference to which the interest rate on Eurodollar Rate
Loans is determined or any category of extensions of credit or other
assets which includes loans by a non-United States office of any Lender to
United States residents).
ADJUSTED NET BOOK VALUE PERCENTAGE shall mean 70%, provided that the
Adjusted Net Book Value Percentage shall be subject to adjustment as provided
below on each date of Holdings' delivery of an appraisal of the Qualified Credit
Parties' Rental Equipment pursuant to this Credit Agreement (for the purposes of
this definition, each such date, a DELIVERY DATE). In the event that on any such
Delivery Date, the product of (x) 85% MULTIPLIED BY (y) the Orderly Liquidation
Value on such date (for the purposes of this definition, such product, the
ORDERLY LIQUIDATION PRODUCT) is less than the product of (i) 70% MULTIPLIED BY
(ii) the Net Book Value of all of the Qualified Credit Parties' Eligible Rental
Equipment on such date, then the Adjusted Net Book Value Percentage shall be
reduced to a percentage such that if such reduced percentage were multiplied by
the Net Book Value of all of the Qualified Credit Parties' Eligible Rental
Equipment on such date the resultant product would equal the Orderly Liquidation
Product on such date, with the Adjusted Net Book Value Percentage to remain at
such reduced percentage until the next succeeding Delivery Date at which time it
shall return to 70% or be adjusted to a percentage below 70% in accordance with
the provisions above. In no event shall the Adjusted Net Book Value Percentage
exceed 70% at any time.
ADMINISTRATIVE AGENT shall mean BTCo in its capacity as Administrative
Agent for the Lenders hereunder, and shall include any successor thereof as
Administrative Agent, appointed as such pursuant to Section 10.9.
AFFECTED LOANS shall have the meaning given to such term in Section
2.5(g).
AFFILIATE shall mean, with respect to any Person, any other Person
which directly or indirectly controls, is controlled by, or is under common
control with, such Person or any Subsidiary of such Person or any Person who is
a director or officer of such Person or any Subsidiary of such Person. For
purposes of this definition, "control" shall mean the possession, directly or
indirectly, of the power to (i) vote ten percent or more of the securities
having ordinary voting power for the election of directors of such Person or
(ii) direct or cause the direction of management and policies of that Person,
whether through the ownership of voting securities, by contract or otherwise and
either alone or in conjunction with others or any group. Neither any Lender nor
any Person controlling any Lender or under common control with such Lender
(including BTCo) nor any of their respective Subsidiaries shall be treated as an
Affiliate of the Credit Parties or their respective Subsidiaries.
Notwithstanding the foregoing, for purposes of determining the Borrowing Base,
no portfolio companies of any of the Equity Investors or of their Affiliates
(excluding Holdings and its Subsidiaries) shall be deemed an Affiliate of the
Borrower or any Subsidiary of the Borrower.
AGENT shall mean and include each of the Administrative Agent
(including in its capacity as Payments Administrator), the Collateral Agent,
each Co-Syndication Agent, each Co-Documentation Agent and, for the purposes of
Section 11.8 and Articles 10 and 12, the Lead Arranger.
AGENT ADVANCE shall have the meaning provided in Section 2.3(c).
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AGENT ADVANCE PERIOD shall have the meaning given to such term in
Section 2.3(c).
AGGREGATE SUPERMAJORITY LENDERS shall mean those Non-Defaulting Lenders
which would constitute Required Lenders under, and as defined in, this Credit
Agreement if the percentage "50%" contained therein were changed to "66-2/3%".
ALTERNATE CURRENCY shall mean, with respect to any Letter of Credit,
any currency other than Dollars as may be acceptable to the Administrative Agent
and the Issuing Lender with respect thereto in their sole discretion.
APPLICABLE EQUITY RECAPTURE PERCENTAGE shall mean, at any time, (x) in
the case of any Public Equity Offering by Holdings, 50%, PROVIDED that if at any
time the Consolidated Leverage Ratio (as established on the last day of the
respective fiscal quarter or year pursuant to the officer's certificate last
delivered (or required to be delivered) pursuant to Section 7.1(a) or (b) but
after giving effect to repayments of Loans (but in the case of repayments of
Revolving Loans only to the extent the Total Revolving Credit Commitment was
contemporaneously reduced by a corresponding amount) made after the last day of
such fiscal quarter or year and prior to the respective application of Net
Equity Proceeds pursuant to the provisions of Section 2.5(k)) is equal to or
less than 3.00:1.00, then the Applicable Equity Recapture Percentage for
purposes of this clause (x) shall instead be 25%, PROVIDED FURTHER, that (i) if
the Applicable Equity Recapture Percentage would otherwise be 50% but after
giving effect the respective application of Net Equity Proceeds pursuant to
Section 2.5(k) in a percentage less than 50%, the Consolidated Leverage Ratio
would be equal to or less than 3.00:1.00, the Applicable Equity Recapture
Percentage for the purposes of this clause (x) shall instead be 25% or such
higher percentage (not to exceed 50%) as may be necessary to reduce the
Consolidated Leverage Ratio to 3.00:1.00 after giving effect to such application
and (ii) notwithstanding anything to the contrary contained above, at any time
that a Default or an Event of Default is then in existence, the Applicable
Equity Recapture Percentage for the purposes of this clause (x) shall be 50% and
(y) in the case of any Equity Issuance by the Borrower or any other Subsidiary
of Holdings, 100%.
APPLICABLE LENDING OFFICE shall mean, with respect to each Lender, such
Lender's Eurodollar Lending Office in the case of a Eurodollar Rate Loan and
such Lender's Domestic Lending Office in the case of a Base Rate Loan.
APPLICABLE MARGIN AND APPLICABLE UNUSED LINE FEE PERCENTAGE shall
initially mean a percentage per annum equal to (x) in the case of Loans
maintained as (A) Base Rate Loans, 1.75% and (B) Eurodollar Rate Loans, 3.00%
and (y) in the case of the Unused Line Fee, 0.500%. From and after each day of
delivery of an officers' certificate in respect of any fiscal quarter or year of
Holdings ending on or after September 30, 2002, in accordance with the following
sentence indicating an entitlement to a different margin than that described in
the immediately preceding sentence (each a "START DATE") to and including the
End Date as described below, the Applicable Margin and Applicable Unused Line
Fee Percentage shall be those set forth opposite the respective Level (i.e.,
▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇ or Level 4, as the case may be) indicated to have been
achieved in any certificate delivered in accordance with the following sentence:
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REVOLVING
LOANS REVOLVING LOANS TERM LOANS
MAINTAINED AS MAINTAINED AS TERM LOANS MAINTAINED AS
BASE RATE EURODOLLAR MAINTAINED AS EURODOLLAR UNUSED
LEVEL LEVERAGE RATIO LOANS RATE LOANS BASE RATE LOANS RATE LOANS LINE FEE
----- -------------- ----- --------- --------------- ---------- --------
Level 1 Greater than 1.750% 3.000% 1.750% 3.000% 0.500%
5.00:1.00
Level 2 Equal to or less 1.500% 2.750% 1.500% 2.750% 0.500%
than 5.00:1.00
but greater than
4.50:1.00
Level 3 Equal to or less 1.250% 2.500% 1.500% 2.750% 0.375%
than 4.50:1.00
but greater than
3.50:1.00
Level 4 Equal to or less 1.125% 2.375% 1.500% 2.750% 0.250%
than 3.50:1.00
The Consolidated Leverage Ratio shall be determined based on the
delivery of a certificate of Holdings (each, a "PRICING CERTIFICATE") by the
chief financial officer, treasurer or controller of the Borrower to the
Administrative Agent (with a copy to be sent by the Administrative Agent to each
Lender), within 45 days of the last day of any fiscal quarter (or 90 days of the
last day of any fiscal year) of Holdings, which certificate shall set forth the
calculation of the Consolidated Leverage Ratio as at the last day of the Test
Period ended immediately prior to the relevant Start Date and the Applicable
Margins and the Applicable Unused Line Fee Percentage which shall be thereafter
applicable (until same are changed or cease to apply in accordance with the
following sentences). The Applicable Margins and the Applicable Unused Line Fee
Percentage so determined shall apply, except as set forth in the succeeding
sentence, from the relevant Start Date to the earliest of (x) the date on which
the next Pricing Certificate is delivered to the Administrative Agent, or (y)
the next date to occur which occurs 45 days after the last day of a Test Period
(or 90 days after such last day if the respective Test Period ends on the last
day of Holdings' fiscal year) (such earliest date, the "END DATE"), at which
time, if no Pricing Certificate has been delivered to the Administrative Agent
indicating an entitlement to a margin lower than Level 1 pricing (and thus
commencing a new Start Date), Level 1 pricing shall be applicable until such
time as Holdings delivers a new Pricing Certificate to the Administrative Agent
indicating an entitlement to a margin lower than Level 1 pricing; it being
understood that such new margin, if any, shall be effective from and after the
date of delivery of such Pricing Certificate until the earliest of the relevant
date described in preceding clauses (x) or (y), as the case may be.
Notwithstanding anything to the contrary contained above in this definition,
Level 1 pricing shall apply at all times (x) during which there shall exist any
Default or Event of Default (it being understood that after all such Defaults
and Events of Default have been cured, the applicable pricing level shall be
determined as otherwise provided above in this definition) and (y) prior to the
date of delivery of the financial statements pursuant to Section 7.1(b) for the
Holdings' fiscal quarter ending on September 30, 2002.
ASSET SALE shall mean the sale, transfer or other disposition by
Holdings, the Borrower or any Subsidiary of Holdings or the Borrower to any
Person other than the Borrower or any Subsidiary Guarantor of any asset of
Holdings, the Borrower or such Subsidiary (other
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than sales, transfers or other dispositions in the ordinary course of business
of inventory (including Rental Equipment) and/or obsolete or excess equipment);
PROVIDED that, except as otherwise provided in the immediately succeeding
proviso, all sale-leaseback transactions shall be deemed to constitute Asset
Sales, PROVIDED, FURTHER, any such sales, transfers or other dispositions
(whether in one or a series of such transactions) generating Net Sale Proceeds
of less than $100,000 shall not constitute an Asset Sale for the purposes of
this Credit Agreement.
AUDITORS shall mean a nationally-recognized firm of independent public
accountants selected by the Borrower and reasonably satisfactory to the
Administrative Agent. For purposes of this Credit Agreement, the Borrower's
current firm of independent public accountants, Ernst & Young LLP, shall be
deemed to be satisfactory to the Administrative Agent.
AVERAGE LEASE TERM shall mean, as of any date, an amount equal to (x)
the total number of months that all existing Leases have been in effect on such
date (including for this purpose the month in which the date recalculation
occurs) divided by (y) the number of all existing Leases as of such date.
AVERAGE RENTAL RATE shall mean, at any time, the average monthly rental
payment per unit of leased Rental Equipment.
BANKRUPTCY CODE shall have the meaning given to such term in Section
9.1(e).
BASE RATE shall mean, at any time, the higher of (i) 1/2 of 1% in
excess of the Federal Funds Rate then in effect and (ii) the Prime Lending Rate.
BASE RATE LOAN shall mean a Loan bearing interest as provided in
Section 4.2.
BOARD OF DIRECTORS shall mean the Board of Directors of Holdings.
BORROWER shall have the meaning given to such term in the preamble to
this Credit Agreement.
BORROWING shall mean an incurrence of Revolving Loans or Term Loans of
the same Type from all the Lenders on the same day (or resulting from Conversion
or Continuance on the same date), having, in the case of Eurodollar Rate Loans,
the same Interest Period.
BORROWING BASE shall have the meaning given to such term in Section
2.2(a).
BORROWING BASE CERTIFICATE shall have the meaning given to such term in
Section 7.1(e).
BORROWING BASE DEFICIENCY shall mean, at any time, the amount, if any,
by which the Revolving Outstandings at such time exceeds the Borrowing Base at
such time.
BTCC shall mean BT Commercial Corporation (and shall include any
successor thereto).
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BTCO shall mean Bankers Trust Company (and shall include any successor
thereto).
BUSINESS DAY shall mean any day other than a Saturday, Sunday or legal
holiday on which commercial banks in New York, New York are authorized to close.
When used in connection with Eurodollar Rate Loans, this definition will also
exclude any day on which commercial banks are not open for dealing in U.S.
Dollar deposits in the New York interbank Eurodollar market.
CALCULATION PERIOD shall have the meaning given to such term in Section
7.17.
CALIFORNIA CERTIFICATED UNITS shall have the meaning provided in
Section 11.19(c).
CANADIAN BANK CONTROL AGREEMENT shall have the meaning provided in
Section 2.6(e).
CANADIAN SECURITY AGREEMENT shall mean and include the security
agreement executed by WSC pursuant to Section 5.1(d)(ii) and each other security
agreement from time to time executed by any Canadian Subsidiary pursuant to
Section 7.16 or in connection with any designation by the Borrower of an
additional province of Canada as a Qualified Canadian Jurisdiction, in each case
in the form of Exhibit F-2 or such other form or forms as Canadian counsel for
the Collateral Agent may suggest with respect to the Canadian Subsidiary to
become party, or the assets subject, thereto or as may otherwise be reasonably
acceptable to the Collateral Agent, and as same may be amended, modified or
supplemented from time to time in accordance with the terms hereof and thereof.
CANADIAN SUBSIDIARIES GUARANTY shall mean and include the guaranty
executed by WSC pursuant to Section 5.1(s)(ii) and each other guaranty from time
to time executed by any other Canadian Subsidiary pursuant to Section 7.16, in
each case in the form of Exhibit J-2 or such other form as Canadian counsel for
the Collateral Agent may suggest with respect to the Canadian Subsidiary party
thereto or as may otherwise be reasonably acceptable to the Collateral Agent,
and as same may be amended, modified or supplemented from time to time in
accordance with the terms hereof and thereof.
CANADIAN SUBSIDIARY shall mean, as to any Person, any Subsidiary of
such Person that is organized under the laws of Canada or any province thereof.
Unless otherwise qualified, all references to a "Canadian Subsidiary" or to
"Canadian Subsidiaries" in this Credit Agreement shall refer to a Canadian
Subsidiary or Canadian Subsidiaries of Holdings.
CANADIAN SUBSIDIARY GUARANTOR shall mean (i) WSC and (ii) each Canadian
Subsidiary of the Borrower which executes and delivers a counterpart of the
Canadian Subsidiaries Guaranty after the Effective Date pursuant to the
requirements of Section 7.16.
CAPEX ROLLOVER AMOUNT shall have the meaning given to such term in
Section 8.4(b).
CAPITAL EXPENDITURES shall mean, as applied to any Person for any
period, the aggregate of all expenditures of (whether paid in cash or accrued as
liabilities (including
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Capitalized Lease Obligations and the acquisition of additional Rental
Equipment)) such Person and its Subsidiaries during that period that, in
conformity with GAAP, are or are required to be included in the property, plant
or equipment or, with respect to Rental Equipment, lease equipment reflected in
the consolidated balance sheet of such Person; PROVIDED, that for purposes of
Section 8.4, the amount of Capital Expenditures for any period shall be equal to
the sum of (i) the change in gross book value of property, plant and equipment
as set forth in the Borrower's respective consolidated balance sheets and (ii)
an amount determined in a manner consistent with the calculation of "net capital
expenditures for rental equipment" in Item 7 of the Borrower's annual report on
Form 10-K for the year ended December 31, 2000; PROVIDED FURTHER, that Capital
Expenditures shall not include the purchase price paid in connection with
Permitted Acquisitions consummated in accordance with Section 7.17.
CAPITAL LEASE, as applied to any Person, shall mean any lease of any
property (whether real, personal or mixed) by that Person or any of its
Subsidiaries as lessee which, in conformity with GAAP, is accounted for as a
capital lease on the consolidated balance sheet of that Person.
CAPITALIZED LEASE OBLIGATIONS shall mean the obligations under Capital
Leases of the Borrower and its Subsidiaries in each case taken at the amount
thereof accounted for as liabilities in accordance with GAAP.
CASH EQUIVALENTS means (i) marketable direct obligations issued or
unconditionally guaranteed by the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition thereof; (ii)
marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within one year from the date of acquisition
thereof and, at the time of acquisition, having the highest rating obtainable
from S&P or ▇▇▇▇▇'▇; (iii) commercial paper maturing not more than one year from
the date of creation thereof and, at the time of acquisition, having the highest
rating obtainable from either S&P's or ▇▇▇▇▇'▇; and (iv) certificates of deposit
or bankers' acceptances maturing within one year from the date of acquisition
thereof issued by any commercial bank organized under the laws of the United
States of America or any state thereof or the District of Columbia that (a) is
at least "adequately capitalized" (as defined in the regulations of its primary
Federal banking regulator) and (b) has Tier 1 capital (as defined in such
regulations) of not less than $500,000,000; (v) repurchase agreements with
respect to, and which are fully secured by a perfected security interest in,
obligations of a type described in clause (i) or clause (ii) above and are with
any commercial bank described in clause (iv) above; and (vi) shares of any money
market mutual fund that (a) has its assets invested continuously in the types of
investments referred to in clauses (i) through (v) above, (b) has net assets of
not less than $500,000,000, and (c) has the highest rating obtainable from
either S&P or ▇▇▇▇▇'▇.
CASUALTY LOSS shall have the meaning given to such term in Section
7.10.
CERCLA shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, 42 U.S.C. ss. 9601 ET SEQ.
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CERTIFICATE OF TITLE shall mean certificates of title, certificates of
ownership or other registration certificates issued or required to be issued
under the certificate of title or other similar laws of any State for any of the
Rental Equipment.
CERTIFICATED UNITS shall mean each Unit which is evidenced by a
Certificate of Title issued under the motor vehicle or other applicable statute
of any State of the United States of America.
CHANGE OF CONTROL shall mean, at any time and for any reason
whatsoever, (a) Holdings shall cease to own directly 100% on a fully diluted
basis of the economic and voting interest in the Borrower's capital stock or (b)
the Borrower shall cease to own directly 100% on a fully diluted basis of the
economic and voting interests in the Unit Subsidiary's equity or (c) the Equity
Investors and/or their respective Affiliates and Permitted Transferees shall
cease to own on a fully diluted basis in the aggregate at least 51% of the
economic and voting interest in Holdings' capital stock or (d) Continuing
Directors cease to constitute a majority of the members of the Board of
Directors of Holdings or (e) a "change of control" or similar event shall occur
as provided in any Permitted Preferred Stock (or the certificates of designation
therefor) or the Senior Unsecured Notes Documents.
CODE shall mean the Internal Revenue Code of 1986, as amended from time
to time, and the regulations promulgated and rulings issued thereunder. Section
references to the Code are to the Code, as in effect at the date of this Credit
Agreement and any subsequent provisions of the Code, amendatory thereof,
supplemental thereto or substituted therefor.
CO-DOCUMENTATION AGENT shall have the meaning given to such term in the
preamble to this Credit Agreement.
COLLATERAL shall mean all of the Collateral as defined in the
Collateral Documents.
COLLATERAL ACCESS AGREEMENTS shall have the meaning given to such term
in Section 5.1(e).
COLLATERAL AGENT shall mean BTCo acting as collateral agent pursuant to
the Collateral Documents and any affiliate of BTCo acting as a sub-collateral
agent pursuant to any of the Collateral Documents (including, without
limitation, BTCC acting as sub-collateral agent with respect to all or any
portion of the Certificated Units and, in connection therewith, being the Person
whose security interest in such Certificated Units may be noted (in lieu of
BTCo) from time to time on certificates of title issued with respect to such
Certificated Units).
COLLATERAL DOCUMENTS shall mean all contracts, instruments and other
documents now or hereafter executed and delivered in connection with this Credit
Agreement, pursuant to which liens and security interests are granted to the
Collateral Agent in the Collateral for the benefit of the Lenders and any other
Secured Creditors, including, without limitation, each Mortgage, each Security
Agreement, the U.S. Pledge Agreement, the Concentration Account Agreement, the
Collection Bank Agreements and the Custodian Agreement.
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COLLECTION ACCOUNT shall mean the account established at a Collection
Bank pursuant to the Collection Bank Agreement, into which funds shall be
transferred pursuant to Section 2.6.
COLLECTION BANK shall have the meaning given to such term in Section
2.6(b)(i).
COLLECTION BANK AGREEMENT shall have the meaning given to such term in
Section 2.6(b)(i).
COLLECTIVE BARGAINING AGREEMENTS shall have the meaning given to such
term in Section 5.1(m).
COMMITMENT OF A LENDER shall mean its Term Loan Commitment (if any),
its Incremental Term Loan Commitment (if any), and its Revolving Credit
Commitment (if any), as in effect from time to time pursuant to the terms of
this Credit Agreement.
CONCENTRATION ACCOUNT shall have the meaning given to such term in
Section 2.6(c).
CONCENTRATION ACCOUNT AGREEMENT shall have the meaning given to such
term in Section 2.6(c).
CONSOLIDATED DEBT shall mean, at any time, all Indebtedness of
Holdings, the Borrower and their respective Subsidiaries (i) for borrowed money
and (ii) with respect to Capitalized Lease Obligations, in each case determined
on a consolidated basis.
CONSOLIDATED EBITDA shall mean, in any fiscal period, Consolidated Net
Income (other than extraordinary items of Holdings, the Borrower and their
respective Subsidiaries for such period but including any Inventory or Rental
Equipment adjustments) for such period, (i) plus the amount of all Consolidated
Interest Expense, federal, state and local income or franchise tax expense (in
each case to the extent such tax expense is included in the Borrower's Financial
Statements as income tax expense), depreciation and amortization, including
amortization or write off of any goodwill or other intangibles for such period,
(ii) less gains and plus losses attributable to any fixed asset sales (other
than Inventory and Rental Equipment), (iii) plus the amortization of debt
issuance costs and (iv) plus or minus (as the case may be) any other non-cash
items (other than any reserve established by Holdings against Accounts,
Inventory and/or Rental Equipment), all determined in accordance with GAAP,
without duplication and only to the extent added or deducted (as the case may
be) in calculating Consolidated Net Income.
CONSOLIDATED INTEREST COVERAGE RATIO shall mean, for any period, the
ratio of (x) Consolidated EBITDA to (y) Consolidated Interest Expense, in each
case for such period.
CONSOLIDATED INTEREST EXPENSE shall mean, for any period, the aggregate
consolidated interest accrued and/or paid by Holdings, the Borrower and their
respective Subsidiaries in respect of Indebtedness determined on a consolidated
basis in accordance with GAAP during such period, including, without limitation,
amortization of original issue discount on any Indebtedness and of all fees
payable in connection with the incurrence of such
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Indebtedness (to the extent included in interest expense), the interest portion
of any deferred payment obligation, the interest component of any Capitalized
Lease Obligations, net cash costs under any Interest Rate Agreements, all
capitalized interest and interest paid by Holdings, the Borrower or their
respective Subsidiaries on debt guaranteed by Holdings, the Borrower or their
respective Subsidiaries; PROVIDED that Consolidated Interest Expense shall not
include amortization of debt issuance costs.
CONSOLIDATED LEVERAGE RATIO shall mean, at any time, the ratio of
Consolidated Debt at such time to Consolidated EBITDA for the most recently
ended Test Period; PROVIDED that for the purposes of calculating the
Consolidated Leverage Ratio only, Consolidated EBITDA for any Test Period shall
be increased (or decreased) on a PRO FORMA basis by Consolidated EBITDA
attributable to each Significant Acquisition (or each Significant Divestiture),
in each case consummated during such Test Period in accordance with the terms
hereof, so long as (in the case of any such increase) the amount of any such
increase is the actual Consolidated EBITDA earned by the Person (or directly
attributable to the business, product line or assets) acquired pursuant to the
respective Significant Acquisition and such actual Consolidated EBITDA is set
forth in reasonable detail and with reasonable supporting documentation in a
written certificate that is executed by the chief executive officer, chief
financial officer, treasurer or controller of the Borrower and is delivered, and
is satisfactory, to the Administrative Agent.
CONSOLIDATED NET INCOME shall mean for any period the consolidated net
income of Holdings, the Borrower and their respective Subsidiaries for such
period as determined in accordance with GAAP.
CONTINGENT OBLIGATIONS shall mean as to any Person, without
duplication, any obligation of such Person guaranteeing or intended to guarantee
any Indebtedness, leases, dividends or other obligations ("PRIMARY OBLIGATIONS")
of any other Person (the "PRIMARY OBLIGOR") in any manner, whether directly or
indirectly, including, without limitation, any obligation of such Person,
whether or not contingent, (a) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (b) to advance or
supply funds (i) for the purchase or payment of any such primary obligation or
(ii) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (c) to
purchase property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (d) otherwise to assure or hold
harmless the owner of such primary obligation against loss in respect thereof;
PROVIDED, HOWEVER, that the term Contingent Obligations shall not include (x)
endorsements of instruments for deposit or collection in the ordinary course of
business or (y) guarantees made by a Person (other than the Unit Subsidiary) of
the obligations of the Borrower or a Wholly-Owned Subsidiary of such Person
which do not constitute Indebtedness of the Borrower or such Wholly-Owned
Subsidiary and are incurred in the ordinary course of business of the Borrower
or such Wholly-Owned Subsidiary. The amount of any Contingent Obligation shall
be deemed to be an amount equal to the stated or determinable amount of the
primary obligation in respect of which such Contingent Obligation is made or, if
not stated or determinable, the maximum reasonably anticipated liability in
respect thereof (assuming such Person is required to perform thereunder) as
determined by such Person in good faith.
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CONTINUE, CONTINUATION AND CONTINUANCE each shall refer to a
continuation of Loans pursuant to Section 4.3, PROVIDED that neither term shall
be deemed to constitute the making of a Loan for purposes of this Credit
Agreement.
CONTINUING DIRECTORS shall mean the directors of Holdings on the
Effective Date and each other director if such director's election or nomination
for the election to the Board of Directors is recommended by a majority of the
then Continuing Directors.
CONVERT, CONVERSION AND CONVERTED each shall refer to a conversion of
Loans of one Type into Loans of another Type pursuant to Section 4.3, PROVIDED
that each such term shall not constitute the making of a Loan for purposes of
this Credit Agreement.
CO-SYNDICATION AGENT shall have the meaning given to such term in the
preamble to this Credit Agreement.
CREDIT AGREEMENT shall mean this Credit Agreement, as the same may be
modified, amended, extended, restated, amended and restated or supplemented from
time to time.
CREDIT AGREEMENT PARTIES shall mean Holdings and the Borrower.
CREDIT DOCUMENTS shall mean, collectively, this Credit Agreement, the
Notes, the Letters of Credit, each of the Collateral Documents, each Guaranty,
each U.S. Subsidiary Joinder Agreement, each Incremental Commitment Agreement
and all other documents and agreements now or hereafter executed and delivered
by a Credit Party in connection herewith or therewith, as the same may be
modified, amended, extended, restated or supplemented from time to time.
CREDIT EVENT shall mean the making of a Loan or the issuance of a
Letter of Credit.
CREDIT PARTIES shall mean, collectively, Holdings, the Borrower and the
Subsidiary Guarantors.
CUSTODIAN AGREEMENT shall have the meaning given to such term in
Section 5.1(v).
CYPRESS GROUP shall mean the Cypress Group L.L.C., Cypress Merchant
Banking Partners L.P. and Cypress Offshore Partners L.P. or any new partnership
created to co-invest with Cypress Group L.L.C., Cypress Merchant Banking
Partners L.P. or Cypress Offshore Partners L.P.; PROVIDED that Persons which had
a majority of the equity interests in or otherwise controlled Cypress --------
Group L.L.C., Cypress Merchant Banking Partners L.P. and/or Cypress Offshore
Partners L.P. on the Effective Date or any of their Permitted Transferees either
(x) hold all the equity interests of such new partnership or (y) control such
new partnership.
DEFAULT shall mean an event, condition or default which with the giving
of notice, the passage of time or both would be an Event of Default.
DEFAULTING LENDER shall have the meaning given to such term in Section
2.4(c).
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DISBURSEMENT ACCOUNT shall have the meaning given to such term in
Section 2.3(b).
DIVIDEND shall have the meaning given to such term in Section 8.6.
DOLLAR EQUIVALENT of an amount denominated in an Alternate Currency
shall mean, at any time for the determination thereof, the amount of Dollars
which could be purchased with the amount of the Alternate Currency involved in
such computation at the spot exchange rate therefor as quoted by the
Administrative Agent as of 11:00 a.m. (New York time) on the date two Business
Days prior to the date of any determination thereof for purchase on such date,
PROVIDED that the Dollar Equivalent of any unpaid drawing under a Letter of
Credit expressed in an Alternate Currency shall be determined at the time the
drawing under the related Letter of Credit was paid or disbursed by the Issuing
Lender, PROVIDED FURTHER, that for purposes of (x) determining compliance with
Sections 2.2(a), 2.5(d) and 3.1(a) and (y) calculating Fees pursuant to Section
4.7, the Dollar Equivalent of any amounts denominated in an Alternate Currency
shall be revalued on a monthly basis using the spot exchange rates therefor as
shown in The Wall Street Journal (or, if same does not provide such exchange
rates, on such other basis as is satisfactory to the Administrative Agent) on
the last Business Day of each calendar month, PROVIDED, HOWEVER, that at any
time during a calendar month, if the Revolving Outstandings (for the purposes of
the determination thereof, using the Dollar Equivalent as recalculated based on
the spot exchange rate therefor as shown in The Wall Street Journal (or, if same
does not provide such exchange rates, on such other basis as is satisfactory to
the Administrative Agent) on the respective date of determination pursuant to
this exception) would exceed 85% of the Total Revolving Credit Commitment, then
at the discretion of the Administrative Agent or at the request of the Required
Lenders, the Dollar Equivalent shall be reset based upon the spot exchange rates
on such date in as shown in The Wall Street Journal (or, if same does not
provide such exchange rates, on such other basis as is satisfactory to the
Administrative Agent), which rates shall remain in effect until the first
Business Day of the then immediately succeeding calendar month or such earlier
date, if any, as the rate is reset pursuant to this proviso. Notwithstanding
anything to the contrary contained in this definition, at any time that a
Default or an Event of Default then exists, the Administrative Agent may revalue
the Dollar Equivalent of any amounts outstanding under any Letters of Credit in
an Alternate Currency in its sole discretion.
DOLLARS and the sign $ shall each mean freely transferable lawful money
of the United States.
DOMESTIC LENDING OFFICE shall mean, with respect to any Lender, the
office of such Lender specified as its "Domestic Lending Office" opposite its
name on Schedule I, as such annex may be amended from time to time.
DOMESTIC SUBSIDIARY shall mean, as to any Person, any Subsidiary of
such Person that is incorporated under the laws of the U.S., any State thereof,
the United States Virgin Islands or Puerto Rico. Unless otherwise qualified, all
references to a "Domestic Subsidiary" or to "Domestic Subsidiaries" in this
Credit Agreement shall refer to a Domestic Subsidiary or Domestic Subsidiaries
of Holdings.
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EFFECTIVE DATE shall have the meaning provided in Section 11.14.
ELIGIBLE ACCOUNTS RECEIVABLE shall mean as at any date, the aggregate
of all Accounts of the Qualified Credit Parties then due and payable in U.S.
Dollars or Canadian Dollars and not deemed by the Administrative Agent in its
Permitted Discretion (after at least two Business Days' prior notice to Borrower
by Administrative Agent) to be ineligible for inclusion in the calculation of
the Borrowing Base. In determining the amount to be so included, (x) the face
amount of such Accounts shall be reduced, without duplication, by the amount of
all returns, discounts, deferred revenue, progress ▇▇▇▇▇▇▇▇, claims, contras,
credits, charges, chargebacks, rebates or other allowances, amounts unearned and
unapplied cash (in each case whether such reductions are attributable to one or
more Accounts) and (but without duplication of any of the foregoing) by the
aggregate amount of all reserves, limits and deductions provided for in this
definition and elsewhere in this Credit Agreement and (y) the amount of Accounts
included shall in no event exceed the book value thereof as determined in a
manner consistent with the Borrower's Financial Statements. Unless otherwise
approved in writing by the Administrative Agent, no Account shall be deemed to
be an Eligible Account Receivable if:
(a) it arises out of a sale or Lease for which no invoice has been
provided to the account debtor; or
(b) it arises out of a sale or Lease made to an Affiliate; or
(c) the Account is unpaid on the date which is (i) 90 days after
the date on which the original invoice provides that such payment is
due or (ii) 120 days after the date of the original invoice; or
(d) the Account (other than Accounts having an aggregate fair
market value not exceeding $5,000,000 at any time) provides for payment
more than 91 days after the date of the original invoice; or
(e) it is from the same account debtor (or any Subsidiary or
parent company thereof) and 50% or more, in face amount, of all
Accounts from such account debtor (or any Subsidiary or parent company
thereof) are ineligible pursuant to (c) above; or
(f) the Account, when aggregated with all other Accounts of such
account debtor (and any Subsidiary or parent company thereof), exceeds
15% in face value of all Accounts of the Borrower and its Subsidiaries
whose Accounts are included in the Borrowing Base then outstanding, to
the extent of such excess; PROVIDED, HOWEVER, that Accounts supported
or secured by insurance acceptable to the Administrative Agent or by an
irrevocable letter of credit in form and substance satisfactory to the
Administrative Agent, issued by a financial institution satisfactory to
the Administrative Agent, and duly pledged to the Collateral Agent
(together with sufficient documentation to permit direct draws by the
Collateral Agent) shall be excluded from this clause (f); or
(g) (i) the account debtor is also a creditor of the Borrower or
any of its Subsidiaries (other than account debtors which have provided
to the Administrative Agent a "no-offset" letter in form and substance
satisfactory to the Administrative Agent), (ii) the account debtor has
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disputed its liability on, or the account debtor has made any claim
with respect to, such Account or any other Account due from such
account debtor to the Borrower, which has not been resolved or (iii)
the Account otherwise is or may become subject to any right of setoff
by the account debtor; or
(h) the account debtor has commenced a voluntary case under the
federal bankruptcy laws, as now constituted or hereafter amended, or
made an assignment for the benefit of creditors, or if a decree or
order for relief has been entered by a court having jurisdiction over
the account debtor in an involuntary case under the federal bankruptcy
laws, as now constituted or hereafter amended, or if any other petition
or other application for relief under the federal bankruptcy laws has
been filed by or against the account debtor, or if the account debtor
has filed a certificate of dissolution under applicable state law or
shall be liquidated, dissolved or wound up, or shall authorize or
commence any action or proceeding for dissolution, winding-up or
liquidation, or if the account debtor has failed, suspended business,
declared itself to be insolvent, is generally not paying its debts as
they become due or has consented to or suffered a receiver, trustee,
liquidator or custodian to be appointed for it or for all or a
significant portion of its assets or affairs, unless (i) the payment of
Accounts from such account debtor is secured in a manner satisfactory
to the Administrative Agent, (ii) with respect to a voluntary or
involuntary bankruptcy or similar proceeding, the court presiding over
such proceeding has authorized such account debtor to pay such Account
to Borrower or (iii) if the Account from such account debtor arises
subsequent to a decree or order for relief with respect to such account
debtor under the federal bankruptcy laws, as now or hereafter in
effect, the Administrative Agent shall have determined that the timely
payment and collection of such Account will not be impaired; or
(i) the sale or Lease is to an account debtor outside of the
United States and Canada, unless the account is supported by insurance
acceptable to the Administrative Agent or the account debtor thereon
has supplied the Borrower with an irrevocable letter of credit in form
and substance satisfactory to the Administrative Agent, issued by a
financial institution satisfactory to the Administrative Agent and
which has been duly pledged to the Collateral Agent (together with
sufficient documentation to permit direct draws by the Collateral
Agent); or
(j) with respect to Accounts arising from a sale, the sale to the
account debtor is on a ▇▇▇▇-and-hold, guaranteed sale, sale-and-return,
sale on approval or consignment basis or made pursuant to any other
written agreement providing for repurchase or return (other than
pursuant to ordinary course of business warranties); or
(k) the Administrative Agent determines in its Permitted
Discretion that such Account may not be paid by reason of the account
debtor's financial inability to pay; or
(l) the account debtor is (I) the United States of America or any
department, agency or instrumentality thereof or (II) Canada or any
department, agency or instrumentality thereof, unless (x) (i) in the
case of preceding clause (I), the Borrower duly assigns its rights to
payment of such Account to the Collateral Agent pursuant to the
Assignment of Claims Act of 1940, as amended (31 U.S.C. ss. 3727 ET
SEQ.) and (ii) in the case of preceding clause (II), the respective
Canadian Subsidiary duly assigns its rights in
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respect of any Crown Debts (as that term is defined in the Financial
Administration Act (Canada)) to which Part VII of the Financial
Administration Act (Canada) applies in accordance with applicable
provisions of such Act and (y) in each case, the respective Account
(and the underlying documentation relating thereto) has no restriction
or prohibition on (or which by its terms, or the terms of any
applicable governmental rule or regulation related thereto, would
restrict or prohibit) the granting of a security interest therein as
provided in the respective Security Agreement, except to the extent
that the respective Qualified Credit Party has obtained from the
applicable Governmental Authority an effective waiver of the respective
restriction and/or prohibition or an effective consent to such a grant
of security interest in each such respective Account; or
(m) the act of the Rental Equipment being leased and put in
service giving rise to such Account has not occurred or the services
giving rise to such Account otherwise have not been performed by the
Borrower and accepted by the account debtor or, with respect to an
Account arising from a sale, the Account does not represent a final
sale; or
(n) the Account does not comply in all material respects with all
applicable legal requirements; or
(o) the Collateral Agent does not have a valid and perfected first
priority security interest in or Lien on such Account, subject only to
Permitted Liens, or the Account does not otherwise conform in all
material respects to the representations and warranties contained in
this Credit Agreement or the other Credit Documents, provided that the
value of any Account shall be reduced by the amount of any obligations
secured by Permitted Liens which are prior to the Lien in favor of the
Collateral Agent.
ELIGIBLE RENTAL EQUIPMENT shall mean all Rental Equipment of the
Qualified Credit Parties held for sale or lease or leased by the respective
Qualified Credit Party as lessor in the ordinary course of business and not
deemed by the Administrative Agent acting in its Permitted Discretion (after at
least two Business Days' prior notice to Borrower by Administrative Agent) to be
ineligible for inclusion in the calculation of the Borrowing Base. In any event,
Eligible Rental Equipment shall account for reserves for Rental Equipment that
is unrentable. In determining the amount to be so included, such Rental
Equipment shall be valued on a net book value basis consistent with the
Borrower's consolidated month-end balance sheet, LESS any reserves otherwise
required by the Administrative Agent pursuant to Section 2.2(b), and LESS any
Rental Equipment that the Administrative Agent determines to be ineligible
pursuant to Section 2.2(b). Unless otherwise approved in writing by the
Administrative Agent, no Rental Equipment shall be deemed Eligible Rental
Equipment if:
(a) the Rental Equipment is not owned solely by a Qualified Credit
Party or with respect to which the respective Qualified Credit Party
does not have good, valid and marketable title, or is held by a third
party for sale on a ▇▇▇▇-and-hold, guaranteed sale, sale-and-return,
sale on approval or consignment basis; or
(b) the Rental Equipment (other than Rental Equipment being leased
or returned by a customer) is not stored on property that is either (i)
owned or leased by a Qualified Credit Party or (ii) owned or leased by
a warehouseman that has contracted
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with a Qualified Credit Party to store Rental Equipment on such
warehouseman's property, PROVIDED that, except as otherwise agreed to
by the Collateral Agent for purposes of determining Eligible Rental
Equipment, after the 90th day following the Effective Date, with
respect to Rental Equipment stored on property leased by a Qualified
Credit Party, the Borrower shall have delivered in favor of the
Collateral Agent a Collateral Access Agreement executed by the lessor
of such property, and, with respect to Rental Equipment stored on
property owned or leased by a warehouseman, the Borrower shall have
delivered to the Collateral Agent a Collateral Access Agreement
executed by such warehouseman; or
(c) the Rental Equipment is not subject to a perfected first
priority Lien in favor of the Collateral Agent except, (i) with respect
to Rental Equipment constituting Non-Certificated Units, all such
Non-Certificated Units with respect to which all applicable UCC filings
have been made as required by the Credit Documents, (ii) with respect
to Eligible Rental Equipment stored at sites described in clause (b)
above, for Liens for normal and customary warehouseman charges and
(iii) to the extent subject only to Permitted Liens, PROVIDED that the
value of any Rental Equipment shall be reduced by the amount of any
obligations secured by Permitted Liens which are prior to the Lien in
favor of the Collateral Agent; or
(d) the Rental Equipment is not located in the United States or a
Qualified Canadian Jurisdiction unless arrangements for the granting
and perfection of a security interest in such Rental Equipment have
been made in a manner acceptable to the Administrative Agent in its
discretion; or
(e) the Rental Equipment does not conform in all material respects
to the representations and warranties contained in the Credit Agreement
or the other Credit Documents; or
(f) whether or not located on property owned or leased by the
Borrower, it is not segregated or otherwise separately identifiable
from goods of others, if any, stored on the same premises as such
Rental Equipment; or
(g) the Rental Equipment is owned by a Qualified Credit Party
other than the Unit Subsidiary, in each case unless (x) the respective
Rental Equipment constitutes Qualified Certificated Units owned by the
Borrower or a Wholly-Owned Subsidiary of the Borrower which is a U.S.
Subsidiary Guarantor, and in each case with respect to which all
actions required to be taken pursuant to Section 7.18 have in fact been
taken or (y) the Rental Equipment is located in a Qualified Canadian
Jurisdiction and is owned by a Wholly-Owned Canadian Subsidiary of the
Borrower which is a Canadian Subsidiary Guarantor; or
(h) the Rental Equipment is subject to Sales-Type Leases or leased
by the Borrower or a Subsidiary thereof as lessor pursuant to a Lease
which contains a bargain purchase option; or
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(i) the Rental Equipment has been or reasonably should be
classified by the Borrower or its Subsidiaries as unrentable.
ELIGIBLE TRANSFEREE shall mean and include (i) a commercial bank, (ii)
a financial institution other than General Electric Capital Corporation and its
Affiliates, (iii) with respect to any Lender, a fund which invests in bank loans
of the types made pursuant to this Credit Agreement as to which such Lender (or
an Affiliate of such Lender) acts as an investment advisor or (iv) any other
"accredited investor" (as defined in SEC Regulation D) other than General
Electric Capital Corporation and its Affiliates.
EMPLOYMENT AGREEMENTS shall have the meaning given to such term in
Section 5.1(m).
END DATE shall have the meaning given to such term in the definition of
"Applicable Margin" and "Applicable Unused Line Fee" contained in this
Agreement.
ENVIRONMENTAL CLAIMS shall mean any and all administrative, regulatory
or judicial actions, suits, demands, demand letters, claims, liens, notices of
noncompliance or violation, investigations (other than internal reports prepared
by the Borrower or any of its Subsidiaries solely in the ordinary course of such
Person's business or as required in connection with a financing transaction and
not in response to any third party action or request of any kind) or proceedings
relating in any way to any Environmental Law or any permit issued, or any
approval given, under any such Environmental Law (hereafter, "CLAIMS"),
including, without limitation, (a) any and all Claims by governmental or
regulatory authorities for enforcement, cleanup, removal, response, remedial or
other actions or damages pursuant to any applicable Environmental Law, and (b)
any and all Claims by any third party seeking damages, contribution,
indemnification, cost recovery, compensation or injunctive relief resulting from
Hazardous Materials arising from alleged injury or threat of injury to health,
safety or the environment.
ENVIRONMENTAL LAW shall mean any applicable Federal, state, foreign or
local statute, law, rule, regulation, ordinance, code, guide, policy and rule of
common law now or hereafter in effect and in each case as amended, and any
judicial or administrative interpretation thereof, including any judicial or
administrative order, consent decree or judgment, relating to the environment,
health, safety or Hazardous Materials, including, without limitation, CERCLA;
RCRA; the Federal Water Pollution Control Act, 33 ▇.▇.▇.▇▇. 1251 ET SEQ.; the
Toxic Substances Control Act, 15 ▇.▇.▇.▇▇. 2601 ET SEQ.; the Clean Air Act, 42
▇.▇.▇.▇▇. 7401 ET seq.; the Safe Drinking Water Act, 42 ▇.▇.▇.▇▇. 300F ET SEQ.;
the Oil Pollution Act of 1990, 33 U.S.Css. 2701 ET SEQ.; the Occupational Safety
and Health Act, 29 U.S.C.ss.651 ET SEQ.; and any applicable state and local or
foreign counterparts or equivalents.
EQUITY INVESTORS shall mean Cypress Group, K-S Investor Group and
Odyssey Investor Group.
EQUITY ISSUANCE shall mean, with respect to any Person, any issuance of
equity (common, preferred or otherwise) by such Person, the receipt of any
capital contribution by such Person, or any issuance of options, warrants or
rights to purchase equity of such Person;
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provided that the receipt of a capital contribution by any Subsidiary of
Holdings from Holdings or another Subsidiary thereof (and the related issuance
of equity by the respective Subsidiary receiving such capital contribution)
shall not constitute an Equity Issuance for purposes of this Credit Agreement.
ERISA shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to ERISA are to ERISA, as in effect at the date
of this Credit Agreement and any subsequent provisions of ERISA, amendatory
thereof, supplemental thereto or substituted therefor.
ERISA AFFILIATE shall mean each person (as defined in Section 3(9) of
ERISA) which together with the Borrower or a Subsidiary of the Borrower would be
deemed to be a "single employer" (i) within the meaning of Section 414(b), (c),
(m) or (o) of the Code or (ii) as a result of the Borrower or a Subsidiary of
the Borrower being or having been a general partner of such person.
EURODOLLAR LENDING OFFICE shall mean, with respect to any Lender, the
office of such Lender specified as its "Eurodollar Lending Office" opposite its
name on Schedule I, as such annex may be amended from time to time (or, if no
such office is specified, its Domestic Lending Office), or such other office or
Affiliate of such Lender as such Lender may from time to time specify to the
Borrower and the Administrative Agent.
EURODOLLAR RATE shall mean, with respect to an Interest Period for each
Eurodollar Rate Loan comprising part of the same Borrowing, an interest rate PER
ANNUM equal to the average (rounded upward to the nearest whole multiple of
one-sixteenth of one percent PER ANNUM, if such rate is not such a multiple) of
the offered quotation, if any, to first class banks in the New York interbank
Eurodollar market by BTCo for U.S. dollar deposits of amounts in immediately
available funds comparable to the principal amount of the Eurodollar Rate Loan
of BTCo for which the Eurodollar Rate is being determined with maturities
comparable to the Interest Period for which such Eurodollar Rate will apply as
of approximately 11:00 A.M. New York City time two Business Days prior to the
commencement of such Interest Period.
EURODOLLAR RATE LOAN shall mean a Loan bearing interest as provided in
Section 4.1.
EVENT OF DEFAULT shall have the meaning given to such term in Section
9.1 of this Credit Agreement.
EXCESS OTHER LIABILITY AMOUNT at any time shall mean the amount (if
any) by which the aggregate amount of Other Liabilities exceeds $75,000,000;
PROVIDED that to the extent the Borrower establishes to the satisfaction of the
Administrative Agent that an increase in Other Liabilities has occurred after
the Effective Date as a result of one or more Permitted Acquisitions, then the
Administrative Agent may in its sole discretion, but shall not be required to,
increase the $75,000,000 amount provided above by an amount not to exceed the
amount established to its satisfaction as being an increase in such Other
Liabilities as a result of such Permitted Acquisition or Permitted Acquisitions.
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EXISTING CREDIT AGREEMENT shall mean the Credit Agreement among
Holdings, the Borrower, the lenders party thereto and BT Commercial Corporation,
as Administrative Agent, dated as of May 22, 1997, as amended and restated as of
September 1, 1998, and as further amended, modified and supplemented to the date
hereof.
EXISTING INDEBTEDNESS shall mean Indebtedness of Holdings, the Borrower
and their respective Subsidiaries outstanding prior to, and to remain
outstanding on and after, the Effective Date, and set forth on Schedule III,
without giving effect to extensions or renewals thereto, except as expressly
provided therein.
EXISTING INDEBTEDNESS AGREEMENTS shall have the meaning given to such
term in Section 5.1(m) hereof.
EXISTING LETTERS OF CREDIT shall have the meaning given to such term in
Section 3.1.
EXISTING LIENS shall have the meaning given to such term in Section
8.2(d).
EXPENSES shall mean all present and future expenses incurred by or on
behalf of the Administrative Agent or any of its Affiliates in connection with
this Credit Agreement, any other Credit Document or otherwise in its or their
capacity as the Administrative Agent under this Credit Agreement or as the
Collateral Agent under the Collateral Documents or as Lead Arranger (including
without limitation, all costs related to the syndication efforts with respect to
this Credit Agreement), whether incurred heretofore or hereafter, which expenses
shall include, without being limited to, the cost of record searches, the
reasonable fees and expenses of attorneys and paralegals, all costs and expenses
incurred by the Administrative Agent (and the Collateral Agent) in opening bank
accounts, depositing checks, electronically or otherwise receiving and
transferring funds, and any charges imposed on the Administrative Agent due to
insufficient funds of deposited checks and the standard fee of the
Administrative Agent (and the Collateral Agent) relating thereto, collateral
examination fees and expenses, reasonable fees and expenses of accountants,
appraisers or other consultants, experts or advisors employed or retained by the
Administrative Agent (and the Collateral Agent), out of pocket syndication fees
and expenses, fees and taxes relative to the filing of financing statements,
costs of preparing and recording any other Collateral Documents, all expenses,
costs and fees set forth in Article 4 of this Credit Agreement, all other fees
and expenses required to be paid pursuant to the Fee Letter and all fees and
expenses incurred in connection with releasing Collateral and the amendment or
termination of any of the Credit Documents.
FACING FEE shall have the meaning given to such term in Section 4.7(a).
FEDERAL FUNDS RATE shall mean, for any period, a fluctuating interest
rate PER ANNUM equal, for each day during such period, to the weighted average
of the rates on overnight Federal Funds transactions with members of the Federal
Reserve System arranged by Federal Funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day that is a Business Day, the average of the quotations for such day on such
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transactions received by the Payments Administrator from three Federal Funds
brokers of recognized standing selected by it.
FEE LETTER shall mean that certain letter dated February 19, 2002 among
the Administrative Agent, the Lead Arranger and the Borrower, in each case
providing for the payment of certain fees in connection with this Credit
Agreement.
FEES shall mean, collectively, the Unused Line Fee, the Letter of
Credit Fees, the Issuing Lender Fees and the other fees provided for in the Fee
Letter.
FINANCIAL STATEMENTS shall mean the consolidated balance sheets and
statements of operations and consolidated statements of cash flows and
statements of changes in shareholder's equity of each of Holdings and its
Subsidiaries and the Borrower and its Subsidiaries for the respective period
specified prepared in accordance with GAAP; PROVIDED that for purposes of
Section 7.1(a), the Financial Statements of Holdings shall include consolidating
schedules.
FOREIGN CASH EQUIVALENTS shall mean (i) certificates of deposit or
bankers acceptances of, and bank deposits with, any bank organized under the
laws of Canada or any country that is a member of the European Economic
Community, whose short-term commercial paper rating from S&P is at least A-1 or
the equivalent thereof or from ▇▇▇▇▇'▇ is at least P-1 or the equivalent
thereof, in each case with maturities of not more than six months from the date
of acquisition, (ii) commercial paper maturing not more than one year from the
date of creation thereof and, at the time of acquisition, having the highest
rating obtainable by either S&P's or Moody's and (iii) shares of any money
market mutual fund that (a) has its assets invested continuously in the types of
investments referred to in clauses (i) and (ii) above, (b) has net assets not
less than $500,000,000 and (c) has the highest rating obtainable by either S&P's
or Moody's.
FOREIGN PENSION PLAN shall mean any plan, fund (including, without
limitation, any superannuation fund) or other similar program established or
maintained outside the United States by the Borrower or any one or more of its
Subsidiaries primarily for the benefit of employees of the Borrower or such
Subsidiaries residing outside the United States, which plan, fund or other
similar program provides, or results in, retirement income, a deferral of income
in contemplation of retirement or payments to be made upon termination of
employment, and which plan is not subject to ERISA or the Code.
FOREIGN SUBSIDIARY of any Person shall mean any Subsidiary of such
Person which is not a Domestic Subsidiary. Unless otherwise qualified, all
references to a "Foreign Subsidiary" or to "Foreign Subsidiaries" in this Credit
Agreement shall refer to a Foreign Subsidiary or Foreign Subsidiaries of
Holdings.
FUNDING AFFILIATE shall have the meaning given to such term in Section
4.10.
GAAP shall mean generally accepted accounting principles in the United
States as in effect from time to time subject to Section 1.2.
GOVERNING DOCUMENTS shall mean, as to any Person, the certificate or
articles of incorporation, the certificate of formation, the by-laws, the
operating agreement, the limited
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liability company or partnership agreement or other organizational or governing
documents of such Person.
GOVERNMENT LEASE shall mean a lease of Rental Equipment by (i) the
Borrower or any Domestic Subsidiary of the Borrower to the United States of
America or any department, agency or instrumentality thereof or (ii) any
Canadian Subsidiary of the Borrower to Canada or any department, agency or
instrumentality thereof.
GOVERNMENTAL AUTHORITY shall mean any nation or government, any state
or other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
GROSS-UP PAYMENTS shall have the meaning given to such term in Section
2.9(b).
GUARANTEED CREDITORS shall mean and include each Agent, each Issuing
Lender, each Lender and each Person (other than any Credit Party) party to an
Interest Rate Agreement to the extent such Person constitutes a Secured Creditor
under the Collateral Documents.
GUARANTEED OBLIGATIONS shall mean (i) the full and prompt payment when
due (whether at the stated maturity, by acceleration or otherwise) of (a) the
principal of and interest on the Notes issued by, and the Loans made to, the
Borrower under this Credit Agreement, (b) all reimbursement obligations and
unpaid drawings with respect to Letters of Credit issued under this Credit
Agreement and (c) all other obligations (including obligations which, but for
any automatic stay under Section 362(a) of the Bankruptcy Code, would become
due) and liabilities owing by the Borrower to the Agents, each Issuing Lender
and the Lenders under the Credit Agreement and the Credit Documents (including,
without limitation, indemnities, Fees and interest thereon), whether now
existing or hereafter incurred under, arising out of or in connection with the
Credit Agreement or any other Credit Document, and the due performance and
compliance with the terms of the Credit Documents by the Borrower and (ii) the
full and prompt payment when due (whether at the stated maturity, by
acceleration or otherwise) of all obligations (including obligations which, but
for any automatic stay under Section 362(a) of the Bankruptcy Code, would become
due) and liabilities owing by the Borrower under any Interest Rate Agreement
entered into by the Borrower with any Lender or a syndicate of financial
institutions organized by BTCo (even if BTCo or any such Lender subsequently
ceases to be a Lender under this Credit Agreement for any reason) and any
institution that participates, and in each case their subsequent assigns, in
such Interest Rate Agreement.
GUARANTORS shall mean Holdings and each Subsidiary Guarantor.
GUARANTY shall mean the Holdings Secured Guaranty and each Subsidiaries
Guaranty.
HAZARDOUS MATERIALS shall mean (a) any petroleum or petroleum products,
radioactive materials, asbestos in any form that is or could become friable,
urea formaldehyde foam insulation, transformers or other equipment that
contained dielectric fluid containing levels of polychlorinated biphenyls, and
radon gas; (b) any chemicals, materials or substances defined as or included in
the definition of "hazardous substances", "hazardous waste", "hazardous
materials", "extremely hazardous substances", "restricted hazardous waste",
"toxic substances",
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"pollutants", "toxic pollutants", "contaminants", or "pollutants", or words of
similar import, under any applicable Environmental Law; and (c) any other
chemical, material or substance, exposure to which is prohibited, limited or
regulated by any governmental authority.
HIGHEST LAWFUL RATE shall mean, at any given time during which any
Obligations shall be outstanding hereunder, the maximum nonusurious interest
rate, if any, that at any time or from time to time may be contracted for,
taken, reserved, charged or received on the Obligations owing under this Credit
Agreement and any other Credit Document, under the laws of the State of New York
(or the law of any other jurisdiction whose laws may be mandatorily applicable
notwithstanding other provisions of this Credit Agreement and the other Credit
Documents), or under applicable federal laws which may presently or hereafter be
in effect and which allow a higher maximum nonusurious interest rate than under
New York (or such other jurisdiction's) law, in any case after taking into
account, to the extent permitted by applicable law, any and all relevant
payments or charges under this Credit Agreement and any other Credit Documents
executed in connection herewith, and any available exemptions, exceptions and
exclusions.
HOLDINGS shall have the meaning given to such term in the preamble to
this Credit Agreement.
HOLDINGS COMMON STOCK shall mean the common stock of Holdings.
HOLDINGS SECURED GUARANTY shall mean the Guaranty of Holdings pursuant
to Article 12 of this Credit Agreement.
IBD CALIFORNIA CERTIFICATED UNITS shall have the meaning specified in
Section 11.19(c).
INCREMENTAL COMMITMENT AGREEMENT shall mean an Incremental Commitment
Agreement substantially in the form of Exhibit R (appropriately completed and
with such modifications as may be acceptable to the Administrative Agent).
INCREMENTAL COMMITMENTS shall mean each Incremental Term Loan
Commitment and each Incremental Revolving Credit Commitment.
INCREMENTAL LENDER shall mean each Incremental Term Loan Lender and
each Incremental Revolving Credit Lender, as the case may be.
INCREMENTAL LOANS shall mean each Incremental Term Loan and each
Incremental Revolving Loan.
INCREMENTAL REVOLVING CREDIT COMMITMENT shall mean, for each
Incremental Revolving Credit Lender, any Commitment by such Incremental
Revolving Credit Lender to make Revolving Loans pursuant to Section 2.1(d) as
agreed to by such Incremental Revolving Credit Lender in the respective
Incremental Commitment Agreement delivered pursuant to Section 2.1(e); it being
understood, HOWEVER, that on each date upon which an Incremental Revolving
Credit Commitment of any Incremental Revolving Credit Lender becomes effective,
such Incremental Revolving Credit Commitment of such Incremental Revolving
Credit Lender shall be added to (and thereafter become a part of) the Revolving
Credit Commitment of such
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Incremental Revolving Credit Lender for all purposes of this Credit Agreement as
contemplated by Section 2.1(d).
INCREMENTAL REVOLVING CREDIT LENDER shall have the meaning provided in
Section 2.2(e).
INCREMENTAL TERM LOAN shall have the meaning provided in Section
2.1(b).
INCREMENTAL TERM LOAN BORROWING DATE shall mean each date on which
Incremental Term Loans are incurred pursuant to Section 2.1(b).
INCREMENTAL TERM LOAN COMMITMENT shall mean, for each Incremental Term
Loan Lender, the Commitment of such Incremental Term Loan Lender to make
Incremental Term Loans pursuant to Section 2.1(b) on a given Incremental Term
Loan Borrowing Date, as such commitment (x) is set forth in the respective
Incremental Commitment Agreement delivered pursuant to Section 2.1(e) and (y)
may be reduced or terminated pursuant to Section 2.5 and/or 9.
INCREMENTAL TERM LOAN LENDER shall have the meaning provided in Section
2.1(e).
INDEBTEDNESS of any Person shall mean without duplication (i) all
indebtedness of such Person for borrowed money, (ii) the deferred purchase price
of assets or services which in accordance with GAAP would be shown on the
liability side of the balance sheet of such Person, (iii) the face amount of all
letters of credit issued for the account of such Person and, without
duplication, all drafts drawn thereunder, (iv) all indebtedness of a second
Person secured by any Lien (in aggregate principal amount up to the amount of
such Liens) on any property owned by such first Person, whether or not such
indebtedness has been assumed, (v) all Capitalized Lease Obligations of such
Person, (vi) all obligations of such Person to pay a specified purchase price
for goods or services whether or not delivered or accepted, I.E., take-or-pay
and similar obligations, (vii) all net obligations of such Person under Interest
Rate Agreements, (viii) all reimbursement or other monetary obligations with
respect to surety, performance and bid bonds, and (ix) all Contingent
Obligations of such Person; PROVIDED that Indebtedness shall not include trade
payables and accrued expenses, in each case arising in the ordinary course of
business.
INDEMNITEE shall have the meaning provided in Section 11.8.
INITIAL BORROWING DATE shall mean the date occurring on or after the
Effective Date on which the initial Borrowing of Loans occurs.
INTEREST PERIOD shall mean for any Eurodollar Rate Loan the period
commencing on the date of the Borrowing, Conversion or Continuance thereof and
ending on the last day of the period selected by the Borrower pursuant to the
provisions below. The duration of each such Interest Period shall be one, two,
three or six months or, to the extent approved by all the Lenders, nine or
twelve months, in each case as the Borrower may, in an appropriate Notice of
Borrowing, Notice of Continuation or Notice of Conversion, select; PROVIDED,
HOWEVER, that the Borrower may not select any Interest Period that ends after
the Maturity Date. Whenever the last day of any Interest Period would otherwise
occur on a day other than a Business Day, the last day of such Interest Period
shall be extended to occur on the next succeeding Business Day;
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PROVIDED, HOWEVER, that if such extension would cause the last day of such
Interest Period to occur in the next following calendar month, the last day of
such Interest Period shall occur on the next preceding Business Day. Whenever
any Interest Period begins on the last Business Day of a calendar month (or on a
day for which there is no numerically corresponding day in the calendar month at
the end of such Interest Period), such Interest Period shall end on the last
Business Day of the applicable calendar month.
INTEREST RATE AGREEMENT shall mean any interest rate protection
agreement, interest rate future, interest rate option, interest rate swap,
interest rate cap or other interest rate hedge or arrangement under which the
Borrower or any of its Subsidiaries is a party or beneficiary.
INVENTORY shall mean all of the Borrower's and its Subsidiaries' now
owned and existing and hereafter arising or acquired inventory, wherever located
and whether in the possession of the Borrower or any other Person, including,
without limitation, (a) all raw materials, work in process, parts, components,
assemblies, supplies and materials used or consumed in the Borrower's and its
Subsidiaries' business and (b) all goods, wares and merchandise, finished or
unfinished, held for sale or lease or furnished or to be furnished under
contracts of service, excluding the Rental Equipment.
INVESTMENT shall have the meaning given to such term in Section 8.5.
ISSUING LENDER shall mean BTCo or any Lender approved by the
Administrative Agent which has agreed to issue Letters of Credit under this
Credit Agreement. As of the Effective Date and until such time as it agrees
otherwise, BTCo shall not be the Issuing Lender with respect to any trade Letter
of Credit.
ISSUING LENDER FEES shall have the meaning given to such term in
Section 4.7.
K-S INVESTOR GROUP shall mean Keystone, Inc., FW Strategic Partners,
L.P. and Scotsman Partners, L.P. and any new partnership or entity created to
co-invest with Keystone, Inc., FW Strategic Partners, L.P., and Scotsman
Partners, L.P., PROVIDED that Persons which had a majority of the equity
interests in or otherwise controlled Keystone, Inc., FW Strategic Partners, L.P.
and/or Scotsman Partners, L.P. on the Effective Date or any of their Permitted
Transferees either (x) hold all the equity interests of such new partnership or
entity or (y) control such new partnership or entity.
LEAD ARRANGER shall have the meaning given to such term in the preamble
to this Credit Agreement.
LEASES shall mean, collectively, the written agreements between
Borrower or any Subsidiary and an account debtor (other than Holdings, the
Borrower, or their respective Subsidiaries) in the ordinary course of business
of Borrower or such Subsidiary for the lease or rental of Rental Equipment by
the Borrower or such Subsidiary to such account debtor in which the account
debtor agrees to pay to the Borrower, such Subsidiary or their respective
assigns Rentals.
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LENDER shall mean each financial institution listed on Schedule I, as
well as any Person which becomes a "Lender" pursuant to Section 11.6.
LETTER OF CREDIT FEES shall have the meaning given to such term in 4.7.
LETTER OF CREDIT OBLIGATIONS shall mean, at any time, the sum of (i)
the Undrawn Letter of Credit Outstandings at such time, PLUS (ii) the aggregate
amount of all drawings (taking the Dollar Equivalent of any amount drawn in an
Alternate Currency) under Letters of Credit which have not been reimbursed by
the Borrower (including through the incurrence of Revolving Loans).
LETTER OF CREDIT REQUEST shall have the meaning given to such term in
Section 3.4.
LETTERS OF CREDIT shall mean all letters of credit (whether trade or
stand-by and whether for the purchase of Inventory, Rental Equipment, equipment
or otherwise) issued for the account of the Borrower pursuant to Article 3 of
this Credit Agreement and all amendments, renewals, extensions or replacements
thereof.
LIEN(S) shall mean any lien, charge, pledge, security interest, deed of
trust, mortgage, other encumbrance or other arrangement having the practical
effect of the foregoing or other preferential arrangement of any other kind and
shall include the interest of a vendor or lessor under any conditional sale
agreement, capital lease or other title retention agreement.
LOAN shall mean each Term Loan and each Revolving Loan.
LOCATION of any Person shall mean such Person's "location" as
determined pursuant to Section 9-307 of the UCC.
MAJORITY LENDERS of any Tranche shall mean those Non-Defaulting Lenders
which would constitute the Required Lenders under, and as defined in, this
Credit Agreement if all outstanding obligations of any other Tranches under this
Credit Agreement were repaid in full and all Commitments, if any, with respect
thereto were terminated.
MANAGEMENT AGREEMENTS shall have the meaning given to such term in
Section 5.1(m).
MARGIN STOCK shall have the meaning provided in Regulation U.
MASTER LEASE AGREEMENTS shall have the meaning provided in Section
5.1(m).
MATERIAL ADVERSE EFFECT shall mean a material adverse effect on (i) the
business, operations, property, assets, liabilities or condition (financial or
otherwise) of the Borrower or of Holdings, the Borrower and their respective
Subsidiaries taken as a whole, (ii) the value of Collateral or the amount which
the Administrative Agent, the Collateral Agent and the Lenders would be likely
to receive (after giving consideration to delays in payment and costs of
enforcement) in the liquidation of such Collateral, (iii) the rights and
remedies of any Agent, the Issuing Lender or the Lenders under any Credit
Document or (iv) on the ability of any Credit Party to perform its obligations
under the Credit Documents.
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MATERIAL CONTRACT shall mean any contract or other arrangement (other
than the Credit Documents), whether written or oral, to which Holdings, the
Borrower or any of their respective Subsidiaries is a party as to which the
breach, nonperformance, cancellation or failure to renew by any party thereto
could reasonably be expected to have a Material Adverse Effect.
MATURITY DATE shall mean December 31, 2006.
MOODY'S shall mean ▇▇▇▇▇'▇ Investors Service, Inc.
MORTGAGE POLICIES shall mean each of the title insurance policies
delivered with respect to one or more of the Mortgages and Mortgaged Property.
MORTGAGED PROPERTY means each property at any time subject to a
Mortgage, with the Mortgaged Properties as of the Initial Borrowing Date
designated as such on Part B of Schedule IV.
MORTGAGES shall mean a mortgage, leasehold mortgage, deed of trust,
leasehold deed of trust, deed to secure debt, leasehold deed to secure debt or
similar security interest granted as security for the Obligations substantially
in the form of Exhibit L.
MULTIEMPLOYER PLAN shall mean a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA.
NET BOOK VALUE shall mean, with respect to Eligible Rental Equipment,
the net book value of such Eligible Rental Equipment determined (i) in
accordance with GAAP and (ii) consistently with the applicable Credit Party's
accounting practices.
NET DEBT PROCEEDS shall mean, with respect to any incurrence of
Indebtedness by any Person, the cash proceeds (net of underwriting discounts and
commissions, reasonable legal fees, investment banking and consulting fees and
other reasonable costs and expenses associated therewith) received by such
Person from the respective incurrence of such Indebtedness.
NET EQUITY PROCEEDS shall mean, with respect to each Equity Issuance of
or by any Person, the cash proceeds (net of underwriting discounts and
commissions, reasonable legal fees, investment banking and consulting fees and
other reasonable costs and expenses associated therewith) received by such
Person from the respective Equity Issuance.
NET SALE PROCEEDS shall mean, with respect to any Asset Sale, the gross
cash proceeds (including any cash received by way of deferred payment pursuant
to a promissory note, receivable or otherwise, but only as and when received)
received by Holdings, the Borrower or any of their respective Subsidiaries from
such Asset Sale, net of (i) transaction costs (including, without limitation,
(w) any federal, state and local income or other taxes paid or estimated to be
payable as a result of such Asset Sale, (x) any underwriting, brokerage or other
customary selling commissions, (y) reasonable legal fees, and (z) advisory,
consulting, accountants', investment banking and other fees and expenses,
including title and recording expenses and reasonable expenses incurred for
preparing such assets for sale, associated therewith), (ii) payments of
unassumed liabilities relating to the assets sold at the time of, or within 90
days after, the date of such sale, (iii) the amount of such gross cash proceeds
required
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to be used to repay any Indebtedness (other than Indebtedness to the Lenders
pursuant to this Credit Agreement) which is secured by the respective assets
which were sold and (iv) in the case of any Asset Sale consummated by a
non-Wholly-Owned Subsidiary of the Borrower, the amount of proceeds paid to the
minority shareholder or shareholders of such non-Wholly-Owned Subsidiary so long
as such amount paid to any such minority shareholder does not exceed such
respective minority shareholder's proportionate share of the aggregate proceeds
from such Asset Sale based on its percentage equity interests held in such
non-Wholly-Owned Subsidiary.
NON-CANADIAN FOREIGN SUBSIDIARIES shall mean each Subsidiary of the
Borrower that is not a Domestic Subsidiary or a Canadian Subsidiary.
NON-CERTIFICATED UNITS shall mean all Units which are not Certificated
Units.
NON-DEFAULTING LENDER shall mean and include each Lender other than a
Defaulting Lender.
NON-QUALIFIED UNITS shall at any time mean any Unit which is not a
Qualified Certificated Unit at such time.
NOTES shall mean, collectively, the Revolving Notes and Term Notes, and
NOTE means any Revolving Note or any Term Note.
NOTICE OF BORROWING shall have the meaning given to such term in
Section 2.3(a)(i) and shall include any deemed Notice of Borrowing pursuant to
Section 3.5.
NOTICE OF CONTINUATION shall have the meaning given to such term in
Section 4.3(a).
NOTICE OF CONVERSION shall have the meaning given to such term in
Section 4.3(b).
OBLIGATIONS shall mean, without duplication, the unpaid principal of
and interest on (including interest accruing on or after the filing of any
petition in bankruptcy, or the commencement of any insolvency, reorganization or
like proceeding, relating to Holdings, the Borrower or any of their respective
Subsidiaries, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding) the Loans or Notes, any reimbursement obligation
or indemnity of Holdings, the Borrower or any of their respective Subsidiaries
on account of Letters of Credit or any accommodation extended with respect to
applications for Letters of Credit, the Fees, the Expenses and all other
obligations and liabilities of Holdings, the Borrower or any of their respective
Subsidiaries to the Agents, the Issuing Lender or to the Lenders, whether direct
or indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in connection with, this
Credit Agreement, the Notes and any other Credit Document.
ODYSSEY INVESTOR GROUP shall mean Odyssey Investment Partners Fund,
L.P. and Odyssey Coinvestors, LLC or any new partnership created to co-invest
with Odyssey Investment Partners Fund, L.P. and Odyssey Coinvestors, LLC,
PROVIDED that Persons which had a majority of the equity interests in or
otherwise controlled Odyssey Investment Partners Fund, L.P. and/or Odyssey
Coinvestors LLC on the Effective Date or any of their Permitted Transferees
either (x)
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hold all the equity interests of such new partnership or entity or (y) control
such new partnership or entity.
OPERATING LEASE shall mean, as applied to any Person, any lease of any
property (whether real, personal or mixed) by that Person other than a
Capitalized Lease Obligation.
OPERATING LEASE PAYMENT shall mean any payment made by Holdings, the
Borrower or any of their respective Subsidiaries under an Operating Lease.
ORDERLY LIQUIDATION VALUE shall mean, with respect to the Eligible
Rental Equipment owned by the Qualified Credit Parties, the aggregate orderly
liquidation value thereof as determined by an appraisal (or update thereof) of
the Qualified Credit Parties' Rental Equipment delivered to the Administrative
Agent pursuant to this Credit Agreement.
OTHER HEDGING AGREEMENTS shall mean any foreign exchange contracts,
currency swap agreements, or other similar agreements or arrangements designed
to protect against fluctuations of currency values.
OTHER LIABILITIES at any time shall mean the accounts payable and
accrued expenses of Holdings and its Subsidiaries on a consolidated basis at
such time set forth in Holdings' consolidated balance sheet, but excluding
accrued interest to the extent otherwise reflected therein.
OUTSTANDINGS shall mean, at any time, the sum of (i) the principal
amount of all Loans outstanding at such time PLUS (ii) the Letter of Credit
Obligations at such time.
PAYMENT OFFICE shall mean the office of the Payments Administrator
located at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ 070302 or any
other office within the continental United States designated by the Payments
Administrator to the Borrower from time to time as the office for payment of all
amounts required to be paid by the Borrower under this Credit Agreement.
PAYMENTS ADMINISTRATOR shall mean BTCo; PROVIDED, HOWEVER, that if BTCo
shall cease to be the Administrative Agent hereunder, the Lenders shall have the
option to appoint one of the remaining Lenders as the Payments Administrator by
written notice to the Borrower.
PBGC shall mean the Pension Benefit Guaranty Corporation established
pursuant to Section 4002 of ERISA, or any successor thereto.
PERMITTED ACQUISITION shall mean the acquisition by the Borrower or any
of its Wholly-Owned Subsidiaries of (i) the assets constituting a business,
division or product line of any Person not already a Subsidiary of the Borrower
(excluding acquisitions by the Borrower, its Domestic Subsidiaries and/or its
Canadian Subsidiaries consisting solely of property, plant and/or equipment (and
not of capital stock or other equity interests, or any liabilities, of any other
Person) which constitute Capital Expenditures justified pursuant to the relevant
provisions of Section 8.4) or (ii) 100% of the capital stock or other equity
interest of any Person, which Person shall, as a result of such acquisition,
become a Wholly-Owned Subsidiary of the Borrower, PROVIDED that (A) the
consideration paid by the Borrower or such Wholly-Owned Subsidiary
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consists solely of cash (including proceeds of Revolving Loans) and, to the
extent permitted under Section 8.3(l), the issuance of unsecured Indebtedness in
an aggregate principal amount not to exceed 10% of the purchase price of such
acquisition, (B) such Person shall own no capital stock of any other Person
unless such Person owns 100% of the capital stock of such other Person and (C)
all requirements of Sections 7.16 and 7.17 applicable to Permitted Acquisitions
are satisfied.
PERMITTED DISCRETION shall mean the Administrative Agent's judgment
exercised in good faith based upon its consideration of any factor which the
Administrative Agent believes in good faith: (i) will or could reasonably be
expected to adversely affect the value of any of the Collateral, the
enforceability or priority of the Administrative Agent's Liens thereon or the
amount which the Agents, the Issuing Lender and the Lenders would be likely to
receive (after giving consideration to delays in payment and costs of
enforcement) in the liquidation of such Collateral; (ii) suggests that any
collateral report or financial information delivered to the Administrative Agent
by any Person on behalf of the Borrower is incomplete, inaccurate or misleading
in any material respect; (iii) materially increases the likelihood of a
bankruptcy, reorganization or other insolvency proceeding involving the Borrower
or any of its Subsidiaries or any of the Collateral; or (iv) creates or
reasonably could be expected to create a Default or an Event of Default. In
exercising such judgment, the Administrative Agent may consider such factors
already included in or tested by the definition of Eligible Accounts Receivable
or Eligible Rental Equipment as well as any of the following: (i) the financial
and business climate of the Borrower's or any Subsidiary's industry, (ii)
changes in collection history and dilution with respect to the Accounts, (iii)
changes in any concentration of risk with respect to Accounts and Rental
Equipment, (iv) changes in operating and turnover statistics with respect to
Rental Equipment and/or Accounts, including actual versus historical and
projected, and (v) any other factors that materially change the credit risk of
lending to the Borrower on the security of the Accounts and Rental Equipment.
The burden of establishing lack of good faith hereunder shall be on the
Borrower.
PERMITTED ENCUMBRANCE shall mean, with respect to any Mortgaged
Property, such exceptions to title as are set forth in the Mortgage Policy
delivered with respect thereto, all of which exceptions must be acceptable to
the Collateral Agent in its reasonable discretion.
PERMITTED LIENS shall have the meaning given to such term in Section
8.2.
PERMITTED PREFERRED STOCK shall mean any preferred stock of Holdings,
so long as the terms of any such preferred stock of Holdings (i) do not provide
any collateral security, (ii) do not provide any guaranty or other support by
the Borrower or any Subsidiary of the Borrower or Holdings, (iii) do not contain
any mandatory put, redemption, repayment, sinking fund or other similar
provision occurring before the first anniversary of the Maturity Date, (iv) do
not require the cash payment of dividends or interest before the first
anniversary of the Maturity Date, (v) do not grant the holders thereof any
voting rights except for (i) voting rights required to be granted to such
holders under applicable law and (ii) limited customary voting rights on
fundamental matters such as mergers, consolidations, sales of substantial
assets, or liquidations involving Holdings and (vi) are otherwise reasonably
satisfactory to the Administrative Agent.
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PERMITTED TRANSFEREE shall mean with respect to any Person who is a
natural person, (i) such individual's spouse or children (natural or adopted),
any trust for such individual's benefit or the benefit of such individual's
spouse or children (natural or adopted), or any corporation or partnership in
which the direct and beneficial owner of all of the equity interest is such
Person or such individual's spouse or children (natural or adopted) or any trust
for the benefit of such persons; and (ii) the heirs, executors, administrators
or personal representatives upon the death of such Person or upon the
incompetency or disability of such Person for purposes of the protection and
management of such individual's assets.
PERSON shall mean any individual, sole proprietorship, partnership,
joint venture, trust, unincorporated organization, association, corporation,
institution, entity, party or government (including any division, agency or
department thereof), and, as applicable, the successors, heirs and assigns of
each.
PLAN shall mean any pension plan as defined in Section 3(2) of ERISA,
which is maintained or contributed to by (or to which there is an obligation to
contribute by) the Borrower or a Subsidiary of the Borrower or an ERISA
Affiliate which is organized under the laws of the United States and is subject
to Title I of ERISA, and each such plan for the five-year period immediately
following the latest date on which Holdings, the Borrower, any of their
respective Subsidiaries or an ERISA Affiliate maintained, contributed to or had
an obligation to contribute to such plan.
PLEDGEE shall have the meaning given to such term in the U.S. Pledge
Agreement.
PRICING CERTIFICATE shall have the meaning given to such term in the
definition of "Applicable Margin" and "Applicable Unused Line Fee Percentage"
contained in this Credit Agreement.
PRIME LENDING RATE shall mean the rate which BTCo publicly announces in
New York City from time to time as its prime lending rate, as in effect from
time to time. The Prime Lending Rate is a reference rate and does not
necessarily represent the lowest or best rate actually charged to any customer.
BTCo may make commercial loans or other loans at rates of interest at, above or
below the Prime Lending Rate.
PROCEEDS shall mean all proceeds of any Collateral.
PROJECTIONS shall have the meaning provided in Section 5.1(o).
PROPORTIONATE SHARE of a Lender shall mean its Term Loan Proportionate
Share or its Revolving Credit Proportionate Share, as the case may be.
PUBLIC EQUITY OFFERING with respect to any Person, means any public
offering of equity of such Person pursuant to an effective registration
statement under the Securities Act.
QUALIFIED CANADIAN JURISDICTION shall mean the provinces of Ontario,
Alberta, British Columbia, Manitoba and Saskatchewan, provided that the Borrower
may designate additional provinces of Canada as Qualified Canadian Jurisdictions
by written notice thereof to the Administrative Agent so long as all recordings,
filings and other actions (including, without
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limitation, the execution and delivery of guarantees and security documentation)
necessary or, in the reasonable opinion of the Collateral Agent, desirable to
perfect and protect the security interests in all of the assets and property of
each Canadian Subsidiary (including, without limitation, all of its assets of
the type described in the Canadian Security Agreement executed by WSC pursuant
to Section 5.1(d)(ii)) which owns (or is to own) assets or property located in
(or which operates in) such additional jurisdiction have been made and taken,
and the Administrative Agent shall have received opinions of counsel in form and
substance satisfactory to the Administrative Agent as to the matters described
above.
QUALIFIED CERTIFICATED UNITS shall mean each Unit, owned by the
Borrower or a Qualified Subsidiary Guarantor organized under the laws of the
United States of America or a State thereof, whether owned on the Effective Date
or acquired thereafter, which at the time in question is a Certificated Unit
with respect to which the requirements set forth in Section 5.1(d)(C) have been
satisfied (with such satisfaction to be determined on the date of any
determination of whether the respective Unit is a Qualified Certificated Unit).
Notwithstanding anything to the contrary contained above, during the first 270
days after the Initial Borrowing Date, all IBD California Certificated Units
owned by the Borrower or a Qualified Subsidiary Guarantor (so long as owned by
the Borrower or such a Qualified Subsidiary Guarantor) shall be deemed to
constitute Qualified Certificated Units so long as the Borrower is not in
violation of the applicable requirements of Section 11.19(c).
QUALIFIED CREDIT PARTIES shall mean the Borrower and each Qualified
Subsidiary Guarantor.
QUALIFIED SUBSIDIARY GUARANTORS shall mean each Wholly-Owned Subsidiary
of the Borrower that (i) is organized under the laws of (x) the United States of
America or a State thereof or (y) under the laws of Canada or a province thereof
which is a Qualified Canadian Jurisdiction and (ii) in each case is a Subsidiary
Guarantor.
RCRA shall mean the Resources Conservation and Recovery Act, as
amended, 42 U.S.C.ss.6901 ET SEQ.
REAL PROPERTY of any Person shall mean all of the right, title and
interest of such Person in and to land, improvements and fixtures, including
leaseholds.
REFINANCING shall mean the repayment in full of all Indebtedness under
the Existing Credit Agreement, the termination of all commitments thereunder and
the termination and release of all security in respect of such Indebtedness, all
contemplated in Section 5.1(x).
REGISTER shall have the meaning provided in Section 11.6(b)(A).
REGULATION D shall mean Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor thereto.
REGULATION T shall mean Regulation T of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or portion thereto.
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REGULATION U shall mean Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor thereto.
REGULATION X shall mean Regulation X of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or portion thereto.
RENTAL EQUIPMENT shall mean the mobile structures generally constructed
of steel or using a steel frame and undercarriage with an exterior of wood or
aluminum and similar products which are sold or leased by Borrower or its
Subsidiaries to third persons in the ordinary course of business and used to
provide office, classroom, storage, commercial or other space, whether in single
units or physically attached to such other units (and including in such form,
modular structures), which structures are capable of being transported to and
assembled on remote sites, and which may be equipped with air conditioning and
heating, electrical outlets, floors, partitions, plumbing, carpeting, moldings,
wall coverings, lighting and other accessories.
RENTALS shall mean all fixed rents or rents which are fixed except for
adjustments based upon the Consumer Price Index payable under the Leases in
respect of the use of any Rental Equipment by account debtors as lessees of such
Rental Equipment to Borrower or its Subsidiaries as the lessor of such Rental
Equipment exclusive of any amounts paid or payable to Borrower or its
Subsidiaries for the sale of Rental Equipment or other Inventory or on account
of the service, site preparation, installation and removal of Rental Equipment,
security deposits, insurance waivers, warranty service, late charges, delivery
fees, moving fees maintenance charges, taxes, insurance and similar charges.
REPLACED LENDER shall have the meaning provided in Section 11.6(d).
REPLACEMENT LENDER shall have the meaning provided in Section 11.6(d).
REPORTABLE EVENT shall mean an event described in Section 4043(c) of
ERISA with respect to a Plan that is subject to Title IV of ERISA other than
those events to the extent to which the 30-day notice period is waived under
subsection .22, .23, .25, .27 or .28 of PBGC Regulation Section 4043.
REQUIRED APPRAISAL shall have the meaning provided in Section 7.2.
REQUIRED LENDERS shall mean, at any time, Non-Defaulting Lenders the
sum of whose outstanding Term Loans and Revolving Loan Commitments (or after the
termination thereof, outstanding Revolving Loans and Revolving Credit
Proportionate Shares of Letter of Credit Obligations) represent more than 50% of
the sum of (i) all outstanding Term Loans of Non-Defaulting Lenders, and (ii)
the Total Revolving Loan Commitment less the Revolving Loan Commitments of all
Defaulting Lenders (or after the termination thereof, the sum of then total
outstanding Revolving Loans of Non-Defaulting Lenders and the aggregate
Revolving Credit Proportionate Shares of all Non-Defaulting Lenders of the total
Letter of Credit Obligations at such time).
REQUIREMENT OF LAW shall mean, as to any Person, the Governing
Documents of such Person, and any law, treaty, rule or regulation or
determination of an arbitrator or a court or
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other Governmental Authority, in each case applicable to or binding upon such
Person or any of its property or to which such Person or any of its property is
subject.
REVOLVING CREDIT COMMITMENT shall mean, for each Lender, the amount set
forth opposite such Lender's name in Schedule I hereto directly below the column
entitled "Revolving Credit Commitment", as same may be (x) increased (or, in the
case of a new Lender, established) as a result of such Lender providing
Incremental Revolving Credit Commitment(s) after the Effective Date and/or (y)
reduced from time to time pursuant to the terms of this Credit Agreement.
REVOLVING CREDIT LENDER means, at any particular time, each Lender
which has a Revolving Credit Commitment at such time or, if the Revolving Credit
Commitments have then been terminated, each Lender which has outstanding
Revolving Loans and/or participations in Letters of Credit (or unreimbursed
payments with respect thereto).
REVOLVING CREDIT PROPORTIONATE SHARE of a Revolving Credit Lender shall
mean, at any particular time, a fraction, expressed as a percentage, obtained by
dividing its Revolving Credit Commitment by the aggregate Revolving Credit
Commitments of all the Revolving Credit Lenders or, if the Revolving Credit
Commitments have been terminated, by dividing (i) the sum of (A) the outstanding
Revolving Loans made by such Revolving Credit Lender, PLUS (B) the amount of
such Revolving Credit Lender's unfunded participations in outstanding Letters of
Credit, PLUS (C) the amount of all payments made by such Revolving Credit Lender
to the Issuing Lender in respect of its participations in Letters of Credit for
which the Borrower has not reimbursed such Revolving Credit Lender (other than
with respect to outstanding Revolving Loans deemed requested pursuant to Section
3.5), by (ii) the sum of (A) the aggregate amount of all Revolving Loans then
outstanding, PLUS (B) the aggregate amount of all Revolving Credit Lenders'
unfunded participations in outstanding Letters of Credit, PLUS (C) the aggregate
amount of all payments made by all Revolving Credit Lenders to the Issuing
Lender in respect of their respective participations in Letters of Credit for
which the Borrower has not reimbursed the Revolving Credit Lenders (other than
with respect to outstanding Loans deemed requested pursuant to Section 3.5).
REVOLVING CREDIT TERMINATION DATE shall mean the first date upon which
all Revolving Credit Commitments and Letters of Credit have terminated (or with
respect to any Letters of Credit only, cash collateralized in a manner
satisfactory to the Administrative Agent), all Revolving Outstandings have been
paid in full in cash, and all interest, Fees and other amounts relating to the
Revolving Credit Commitments, Revolving Loans and Letters of Credit have been
repaid in full (or with respect to Letters of Credit only, cash collateralized
in a manner satisfactory to the Administrative Agent).
REVOLVING LOAN BORROWING DATE shall have the meaning given such term in
Section 2.4
REVOLVING LOANS shall have the meaning given to such term in Section
2.1(c).
REVOLVING NOTE shall mean a promissory note of the Borrower payable to
the order of a Lender, in the form of Exhibit A-2, evidencing the aggregate
Indebtedness of the
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Borrower to such Lender resulting from the Revolving Loans made by such Lender
or acquired by such Lender pursuant to Section 11.6.
REVOLVING OUTSTANDINGS shall mean, at any time, the sum of (i) the
principal amount of all Revolving Loans at such time PLUS (ii) the Letter of
Credit Obligations.
S&P shall mean Standard & Poor's Rating Services.
SALES-TYPE LEASES shall mean a Lease that should be treated as a
capital lease in accordance with Financial Accounting Standards Board Statement
No. 13, as amended, from time to time or if such statement is not then in
effect, such other statement of GAAP as may be applicable.
SCHEDULED REPAYMENT shall have the meaning given to such term in
Section 2.5(a).
SCHEDULED REPAYMENT DATE shall have the meaning given to such term in
Section 2.5(a).
SEC shall have the meaning given to such term in 7.1(i).
SECTION 2.9(B)(II) CERTIFICATE shall have the meaning provided in
Section 2.9(b)(ii).
SECURED CREDITORS shall have the meaning given to such term in the
respective Collateral Documents.
SECURED CREDITOR GRANTORS shall have the meaning given to such term in
Section 11.21.
SECURITIES ACT means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder from time to time.
SECURITY AGREEMENTS shall mean each of the U.S. Security Agreement and
each Canadian Security Agreement.
SECURITY BOND OBLIGATIONS shall have the meaning given to such term in
Section 11.21.
SENIOR UNSECURED NOTES shall mean the 9 7/8% Senior Unsecured Notes due
2007 issued by the Borrower, and any substantially identical exchange notes
issued pursuant to the Senior Unsecured Notes Indenture.
SENIOR UNSECURED NOTES DOCUMENTS shall mean the Senior Unsecured Notes,
the Senior Unsecured Notes Indenture and all other documentation relating
thereto.
SENIOR UNSECURED NOTES INDENTURE shall mean the Indenture, dated as of
May 15, 1997 between the Borrower, the Subsidiary Guarantors (by means of one or
more supplemental
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indentures) and the Bank of New York as Trustee, as in effect on the Effective
Date and as the same may be amended, modified or supplemented in accordance with
the terms hereof and thereof.
SETTLEMENT DATE shall have the meaning given to such term in Section
2.4(b)(i).
SHAREHOLDERS' AGREEMENTS shall have the meaning given to such term in
Section 5.1(m)(iv).
SIGNIFICANT ACQUISITION shall mean any acquisition by the Borrower or
any of its Subsidiaries of another Person (not already a Subsidiary of the
Borrower), or the assets constituting all or a significant portion of a
business, division or product line of any such Person, the fair market value
(determined in good faith by the Borrower) of which exceeds $1,000,000 for any
such transaction (or series of related transactions).
SIGNIFICANT DIVESTITURE shall mean any sale or other disposition of
assets by the Borrower or any of its Subsidiaries to any other Person (other
than the Borrower or a Subsidiary thereof), the fair market value (determined in
good faith by the Borrower) of which exceeds $1,000,000 for any such transaction
(or series of related transactions).
START DATE shall have the meaning given to such term in the definition
of "Applicable Margin" and "Applicable Unused Line Fee Percentage" contained in
this Credit Agreement.
SUBSIDIARIES GUARANTY shall mean each of the U.S. Subsidiaries Guaranty
and each Canadian Subsidiaries Guaranty.
SUBSIDIARY shall mean as to any Person, a corporation, partnership or
other entity of which shares of stock or other ownership interests having
ordinary voting power (other than stock or such other ownership interests having
such power only by reason of the happening of a contingency) to elect a majority
of the board of directors or other managers of such corporation, partnership or
other entity are at the time owned, or the management of which is otherwise
controlled, directly or indirectly through one or more intermediaries, or both,
by such Person. Unless otherwise qualified, all references to a "Subsidiary" or
to "Subsidiaries" in this Credit Agreement shall refer to a Subsidiary or
Subsidiaries of the Borrower.
SUBSIDIARY GUARANTOR shall mean each U.S. Subsidiary Guarantor and each
Canadian Subsidiary Guarantor.
SUPERMAJORITY LENDERS of any Tranche shall mean those Non-Defaulting
Lenders which would constitute the Required Lenders under, and as defined, in
this Credit Agreement if (x) all outstanding Obligations of the other Tranches
under this Credit Agreement were repaid in full and all Commitments, if any,
with respect thereto were terminated and (y) the percentage "50%" contained
therein were changed to "66-2/3%".
SURETY shall have the meaning given to such term in Section 8.2(o).
SURETY BOND shall have the meaning given to such term in Section
8.2(o).
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SYNDICATION DATE shall mean the earlier of (x) the date which is 90
days after the Effective Date and (y) the date (which may occur prior to, on or
after the Effective Date) upon which the Administrative Agent determines in its
sole discretion (and notifies the Borrower) that the primary syndication of the
Credit Agreement (and the resulting addition of institutions as Lenders pursuant
to Section 11.6) has been completed, notice of which shall be promptly given to
the Borrower.
TAX BENEFIT shall have the meaning given to such term in Section
2.9(c).
TAX SHARING AGREEMENTS shall have the meaning given to such term in
Section 5.1(m).
TAXES shall have the meaning given to such term in Section 2.9.
TERM LOAN shall have the meaning provided in Section 2.1(a) (and shall
include any Incremental Term Loans actually made).
TERM LOAN COMMITMENT shall mean, for each Lender, the amount set forth
opposite such Lender's name in Schedule I hereto directly below the column
entitled "Term Loan Commitment", as same may be reduced from time to time
pursuant to the terms of this Credit Agreement.
TERM LOAN LENDER shall mean, at any particular time, each Lender which
has a Term Loan Commitment at such time or, after the date of the funding of the
Term Loans, each Lender which has any Term Loan Outstandings owing to it at such
time.
TERM LOAN OUTSTANDINGS shall mean, with respect to any Term Loan Lender
at any particular time, the aggregate outstanding principal balance of the Term
Loans owing to such Term Loan Lender.
TERM LOAN PROPORTIONATE SHARE of a Term Loan Lender shall mean, at any
particular time, a fraction, expressed as a percentage, obtained by dividing its
Term Loan Commitment by the aggregate Term Loan Commitments of all the Term Loan
Lenders or, after the date of the funding of the Term Loans, by dividing (i) the
Term Loan Outstandings of such Term Loan Lender by (ii) the aggregate Term Loan
Outstandings of all Term Loan Lenders.
TERM LOANS shall have the meaning given to such term in Section 2.1.
TERM NOTE shall mean a promissory note of the Borrower payable to the
order of a Lender, in the form of Exhibit A-1, evidencing the aggregate
Indebtedness of the Borrower to such Lender resulting from the Term Loans made
by such Lender or acquired by such Lender pursuant to Section 11.6.
TEST PERIOD shall mean each period of four consecutive fiscal quarters
of the Borrower (taken as one accounting period).
TOTAL COMMITMENTS at any time shall mean the aggregate of the
Commitments, as then in effect, of all the Lenders.
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TOTAL REVOLVING CREDIT COMMITMENTS shall mean at any time the aggregate
of the Revolving Credit Commitments of the Revolving Loan Lenders.
TOTAL TERM LOAN COMMITMENTS shall mean at any time the aggregate of the
Term Loan Commitments of the Term Loan Lenders.
TRADE NAME LICENSE AGREEMENT shall mean that certain Trade Name and
Service ▇▇▇▇ License Agreement, dated as of September 1, 1998, by and among
Space Master International, Inc., Space Master Building Systems, LLC, Space
Master Manufacturing, Inc., Space Master Manufacturing of Pennsylvania, Inc.,
and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, as in effect on the Effective Date (as same may be
amended, modified or supplemented from time to time pursuant to the terms hereof
and thereof).
TRANCHE shall mean the respective facility and commitments utilized in
making Loans hereunder, with there being two separate Tranches, I.E., Term Loans
and Revolving Loans.
TYPE shall mean the type of Loan determined with regard to the interest
option applicable thereto, I.E., whether a Base Rate Loan or a Eurodollar Rate
Loan.
UCC shall mean the Uniform Commercial Code as in effect from time to
time in the relevant jurisdiction.
UNDRAWN LETTER OF CREDIT OUTSTANDINGS shall mean, at any time, the
aggregate undrawn amount of all Letters of Credit outstanding at such time
(taking the Dollar Equivalent at such time of any such undrawn amounts under
Letters of Credit denominated in an Alternate Currency).
UNFUNDED CURRENT LIABILITY of any Plan shall mean the amount, if any,
by which the actuarial present value of the accumulated plan benefits under the
Plan as of the close of its most recent plan year, determined in accordance with
actuarial assumptions at such time consistent with Statement of Financial
Accounting Standards No. 87, exceeds the market value of the assets allocable
thereto.
UNIT shall have the meaning given to such term in the U.S. Security
Agreement.
UNIT CERTIFICATES shall mean certificates of title, certificates of
ownership or other registration certificates issued or required to be issued
under the laws of any State for any of the Rental Equipment owned or leased by
the Borrower or any Guarantor.
UNIT SUBSIDIARY means Willscot Equipment, LLC, a Delaware limited
liability company; provided that upon any conversion of the Unit Subsidiary to a
Delaware business trust (as contemplated by Section 11.20), the term "Unit
Subsidiary" shall mean and include the successor Delaware business trust (as
same may be renamed).
UNIT SUBSIDIARY MANAGEMENT AGREEMENT shall mean the Unit Subsidiary
Management Agreement, dated as of May 22, 1997, and as amended and restated as
of the
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Effective Date, between the Borrower and the Unit Subsidiary and shall include
any other management agreement entered into by the Borrower with the Unit
Subsidiary so long as all terms and conditions thereof are reasonably acceptable
to the Administrative Agent.
UNITED STATES and U.S. shall each mean the United States of America.
UNUSED LINE FEE shall have the meaning provided in Section 4.6.
U.S. CREDIT PARTIES shall mean each of Holdings, the Borrower and each
Domestic Subsidiary that is a Subsidiary Guarantor.
U.S. PLEDGE AGREEMENT shall have the meaning provided in Section
5.1(t).
U.S. PLEDGE AGREEMENT COLLATERAL shall mean all "Collateral" as defined
in the US Pledge Agreement.
U.S. SECURITY AGREEMENT shall have the meaning given to such term in
Section 5.1(d)(i).
U.S. SUBSIDIARIES GUARANTY shall have the meaning given to such term in
Section 5.1(s)(i).
U.S. SUBSIDIARY GUARANTOR shall mean (i) each Domestic Subsidiary of
the Borrower in existence on the Effective Date and (ii) each Domestic
Subsidiary of the Borrower which executes and delivers a counterpart of the U.S.
Subsidiaries Guaranty after the Effective Date pursuant to the requirements of
Section 7.16.
UTILIZATION shall mean for any period the fraction expressed as a
percentage, (x) the numerator of which is the gross book value of units of
Rental Equipment of the Qualified Credit Parties leased to customers at the end
of such period and (y) the denominator of which is the gross book value of units
of Rental Equipment owned, leased (as lessee) or held for sale or lease (as
lessor) by the Qualified Credit Parties at the end of such period, provided that
any such new Rental Equipment that is classified by any such Qualified Credit
Party as "equipment held for sale" in accordance with past practices shall be
excluded from the calculation of "utilization" under this definition so long as
(i) such Qualified Credit Party has received a firm purchase order or binding
commitment from its customer for such Rental Equipment and (ii) such Rental
Equipment will be sold upon completion of related delivery and installation to
such customer after such Qualified Credit Party's purchase thereof.
WHOLLY-OWNED CANADIAN SUBSIDIARY shall mean, as to any Person, any
Wholly-Owned Subsidiary of such Person that is incorporated under the laws of
Canada or any province thereof. Unless otherwise qualified, all references to a
"Wholly-Owned Canadian Subsidiary" or to "Wholly-Owned Canadian Subsidiaries" in
this Credit Agreement shall refer to a Wholly-Owned Canadian Subsidiary or
Wholly-Owned Canadian Subsidiaries of the Borrower.
WHOLLY-OWNED DOMESTIC SUBSIDIARY shall mean, as to any Person, any
Wholly-Owned Subsidiary of such Person that is incorporated under the laws of
the U.S., any State thereof, the United States Virgin Islands or Puerto Rico.
Unless otherwise qualified, all
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references to a "Wholly-Owned Domestic Subsidiary" or to "Wholly-Owned Domestic
Subsidiaries" in this Credit Agreement shall refer to a Wholly-Owned Domestic
Subsidiary or Wholly-Owned Domestic Subsidiaries of the Borrower.
WHOLLY-OWNED SUBSIDIARY shall mean, as to any Person, (i) any
corporation 100% of whose capital stock (other than director's qualifying
shares) is at the time owned by such Person and/or one or more Wholly-Owned
Subsidiaries of such Person and (ii) any partnership, association, joint venture
or other entity in which such Person and/or one or more Wholly-Owned
Subsidiaries of such Person has a 100% equity interest at such time. Unless
otherwise qualified, all references to a "Wholly-Owned Subsidiary" or to
"Wholly-Owned Subsidiaries" in this Credit Agreement shall refer to a
Wholly-Owned Subsidiary or Wholly-Owned Subsidiaries of the Borrower.
WSC shall mean ▇▇▇▇▇▇▇▇ Scotsman of Canada, Inc., a corporation
organized under the laws of the province of Ontario.
WSC ONTARIO ASSETS shall have the meaning given to such term in Section
11.19(d).
WSC RECEIVABLES shall have the meaning given to such term in Section
11.19(d).
1.2 ACCOUNTING TERMS AND DETERMINATIONS. (a) Unless otherwise
defined or specified herein, all accounting terms used herein shall have the
meanings customarily given in accordance with GAAP, and all financial
computations to be made under this Credit Agreement shall, unless otherwise
specifically provided herein, be made in accordance with GAAP applied on a basis
consistent in all material respects with the Financial Statements referred to in
Section 6.10(b). All accounting determinations for purposes of determining
compliance with Sections 8.4, 8.9, 8.10 and 8.11 and calculating the Borrowing
Base as set forth in Section 2.2 and the definitions of "Eligible Rental
Equipment" and "Eligible Accounts Receivable" shall be made in accordance with
GAAP as in effect on the Effective Date and applied on a basis consistent in all
material respects with the Financial Statements referred to in Section 6.10(b).
Without limiting the foregoing, if the Borrower changes its depreciation
methodology after the Effective Date, such change shall not be given effect for
purposes of determining compliance with the Sections referenced in the
immediately preceding sentence or for making calculations of the types described
in the immediately preceding sentence. The Financial Statements required to be
delivered hereunder from and after the Effective Date and all financial records
shall be maintained in accordance with GAAP as in effect as of the date of the
Financial Statements referred to in Section 6.10(b) or, if GAAP shall change
from the basis used in preparing the Financial Statements referred to in Section
6.10(b), the certificates required to be delivered pursuant to Section 7.1
demonstrating compliance with the covenants contained herein shall include
calculations setting forth the adjustments necessary to demonstrate how the
Borrower is in compliance with the financial covenants based upon GAAP as
utilized in the Financial Statements referred to in Section 6.10(b).
1.3 OTHER DEFINED TERMS. Terms not otherwise defined herein which
are defined in the UCC as in effect on the date hereof in the State of New York
shall have the meanings given them in such UCC. The words "hereof", "herein" and
"hereunder" and words of similar
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import when used in this Credit Agreement shall refer to this Credit Agreement
as a whole and not to any particular provision of this Credit Agreement, and
references to Article, Section, Schedule, Exhibit and like references are
references to this Credit Agreement unless otherwise specified. An Event of
Default shall "continue" or be "continuing" until such Event of Default has been
cured or waived in accordance with Section 11.10 hereof.
ARTICLE 2
AMOUNT AND TERMS OF CREDIT
--------------------------
2.1 THE COMMITMENTS. (a) Subject to the terms and conditions set
forth in this Credit Agreement, on the Initial Borrowing Date, each Term Loan
Lender severally agrees to make a term loan or term loans to the Borrower (each,
together with any Incremental Term Loans actually made after the Effective Date
pursuant to Section 2.1(b), a "TERM LOAN" and, collectively, the "TERM LOANS")
in an aggregate amount equal to its Term Loan Proportionate Share of the Total
Term Loan Commitments, which Term Loans shall be made and initially maintained
as a single Borrowing of Base Rate Loans (subject to the option to convert such
Term Loans pursuant to Section 4.3). Once repaid, Term Loans incurred hereunder
may not be reborrowed. On and immediately after the occurrence of the Effective
Date, the Term Loan Commitment for each Lender shall be the amount set forth
opposite such Lender's name in Schedule I hereto directly below the column
entitled "Term Loan Commitment" (as same may be reduced from time to time
pursuant to the terms of this Credit Agreement). The Borrower hereby agrees to
execute and deliver to each Lender that requests same a Term Note in the form of
Exhibit A-1 to evidence the Term Loans made by such Lender.
(b) Subject to Section 2.1(d) and (e), the other terms and
conditions set forth herein and the relevant Incremental Commitment Agreement,
each Lender with an Incremental Term Loan Commitment severally agrees to make a
term loan or term loans (each, an "INCREMENTAL TERM LOAN" and, collectively, the
"INCREMENTAL TERM LOANS") to the Borrower, which Incremental Term Loans: (i)
only may be incurred on one or more Incremental Term Loan Borrowing Dates (which
dates, in any event (x) shall not be earlier than the Syndication Date (for this
purpose, determined as if clause (x) contained in the definition of Syndication
Date were deleted) and (y) shall not be later than 30 Business Days prior to the
Maturity Date); (ii) shall be made by each such Lender in that aggregate
principal amount which does not exceed the Incremental Term Loan Commitment of
such Lender (as set forth in the relevant Incremental Commitment Agreement) on
the respective Incremental Term Loan Borrowing Date and (iii) shall not exceed
in aggregate principal amount, when added to the aggregate amount of Incremental
Commitments provided by all Incremental Lenders pursuant to Section 2.2(d),
$30,000,000. Notwithstanding anything to the contrary contained above or
elsewhere in this Credit Agreement, no Incremental Term Loan shall be made on
any date if, after giving effect thereto, the conditions set forth in Section
5.2 would not be satisfied or if a Borrowing Base Deficiency would exist after
giving effect to making of the respective Incremental Term Loans and any other
Credit Events to occur on such date. Once repaid, Incremental Term Loans may not
be reborrowed. After any Incremental Term Loans are actually made, the
Administrative Agent is authorized to make such modifications to Schedule I as
are appropriate to reflect the revised outstanding Term Loans of the various
Lenders. The Borrower hereby agrees to execute
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and deliver to each Lender that requests same a Term Note in the form of Exhibit
A-1 to evidence the Term Loans (including any Incremental Term Loans) made by
such Lender.
(c) Subject to the terms and conditions set forth in this Credit
Agreement, on and after the Initial Borrowing Date and to and excluding the
Maturity Date, each Revolving Credit Lender severally agrees to make revolving
loans and advances to the Borrower hereunder (the "REVOLVING LOANS"). Subject to
the provisions of this Credit Agreement, the Borrower may borrow, repay (without
penalty, except for breakage costs under Section 4.5(b)) and re-borrow Revolving
Loans, all in accordance with the terms and conditions hereof. On and
immediately after the occurrence of the Effective Date, the Revolving Credit
Commitment for each Lender shall be the amount set forth opposite such Lender's
name in Schedule I hereto directly below the column entitled "Revolving Credit
Commitment" (as same may be (x) increased from time to time as a result of the
respective Lender furnishing Incremental Revolving Credit Commitment(s) after
the Effective Date and/or (y) reduced from time to time pursuant to the terms of
this Credit Agreement). If any Incremental Revolving Credit Commitments are
provided after the Effective Date, the Administrative Agent is authorized to
make such changes to Schedule I as are appropriate to reflect the revised
Revolving Credit Commitments of the various Lenders. The Borrower hereby agrees
to execute and deliver to each Lender that requests same a Revolving Note in the
form of Exhibit A-2 to evidence the Revolving Loans made by each such Lender.
(d) So long as no Default or Event of Default then exists or would
result therefrom, the Borrower, in consultation with the Administrative Agent,
shall have the right to request from time to time after the Syndication Date
(for this purpose, determined as if clause (x) contained in the definition of
Syndication Date were deleted) and prior to the Maturity Date that one or more
Lenders (and/or one or more other Persons which will become Lenders as provided
below) provide Incremental Commitments and, subject to the terms and conditions
contained in this Credit Agreement, make Incremental Term Loans or Revolving
Loans, as the case may be, pursuant thereto; it being understood and agreed,
however, that:
(i) no Lender shall be obligated to provide an Incremental
Commitment as a result of any such request by the Borrower, and until
such time, if any, as such Lender has agreed in its sole discretion to
provide an Incremental Commitment and executed and delivered to the
Administrative Agent an Incremental Commitment Agreement as provided in
clause (e)(i) of this Section 2.1, such Lender shall not be obligated
to fund any Incremental Loans;
(ii) any Lender (or, in the circumstances contemplated by clause
(v) below, any other Person which will qualify as an Eligible
Transferee) may so provide an Incremental Commitment without the
consent of any other Lender;
(iii) the Incremental Commitments provided pursuant to this clause
(c) shall be in a minimum aggregate amount (for all Lenders (including
in the circumstances contemplated by clause (v) below, Eligible
Transferees who will become Lenders)) of at least $5,000,000 and in
integral multiples of $1,000,000 in excess thereof,
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(iv) the aggregate amount of all Incremental Commitments permitted
to be provided pursuant to this Section 2.1 shall not exceed
$30,000,000;
(v) if, after the Borrower has requested the then existing Lenders
(other than Defaulting Lenders) to provide Incremental Commitments
pursuant to this clause (d), the Borrower has not received Incremental
Commitments in an aggregate amount equal to that amount of Incremental
Commitments which the Borrower desires to obtain pursuant to such
request (as set forth in the notice provided by the Borrower as
provided below), then the Borrower may request Incremental Commitments
from Persons which would qualify as Eligible Transferees hereunder in
an aggregate amount equal to such deficiency, PROVIDED that (x) any
such Incremental Commitment provided by any such Eligible Transferee
shall be in a minimum amount (for such Eligible Transferee) of at least
$1,000,000, (y) the fees to be paid to such Eligible Transferee shall
be no greater than those paid (or which were offered to) to the then
existing Lenders providing (or which were requested to provide) the
respective requested Incremental Commitments) and (z) the consent of
the Administrative Agent shall be required with respect to each Person
(not an existing Lender) which provides any Incremental Commitment,
such consent not to be unreasonably withheld;
(vi) if any Incremental Revolving Credit Commitment is provided,
the consent of each Issuing Lender to the Lender providing same
(whether an existing or new Lender) shall be required, which consents
shall not be unreasonably withheld;
(vii) each Lender agreeing to provide an Incremental Commitment
pursuant to an Incremental Commitment Agreement shall, subject to the
satisfaction of the relevant conditions set forth in this Agreement,
make Incremental Term Loans or Revolving Loans, as the case may be, as
specified in such Incremental Commitment Agreement and such Loans shall
thereafter be deemed to be Term Loans or Revolving Loans, as the case
may be, for all purposes of this Credit Agreement and the other Credit
Documents;
(viii) Incremental Loans to be made pursuant to such Incremental
Commitment Agreement shall mature on the Maturity Date and shall bear
interest at the same rates (I.E., have the same Applicable Margins)
applicable the respective Tranche under which such Incremental Loans
were made;
(ix) Incremental Term Loans shall amortize (as part of the
outstanding Term Loans) on each Scheduled Repayment Date occurring
after the incurrence of such Incremental Term Loans in accordance with
the provisions of Section 2.5(a) hereof (with the amount of the
Scheduled Repayments to be increased as provided in the last sentence
of Section 2.5(a), so that the then remaining Scheduled Repayments of
Term Loans are increased proportionately to give effect to the
extension of Incremental Term Loans); and
(x) all actions by the Borrower pursuant to this clause (d) shall
be taken in coordination with the Administrative Agent.
(e) In connection with the Incremental Commitments to be provided
pursuant to preceding clause (d):
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(i) the Borrower, the Administrative Agent and each such Lender or
other Eligible Transferee which agrees to provide an Incremental
Commitment (each such Lender or Eligible Transferee which has agreed to
provide an Incremental Term Loan Commitment, an "INCREMENTAL TERM LOAN
LENDER" and each such Lender or Eligible Transferee who has agreed to
provide an Incremental Revolving Credit Commitment, an "INCREMENTAL
REVOLVING CREDIT LENDER") shall execute and deliver to the
Administrative Agent (with a copy to the Borrower) an Incremental
Commitment Agreement substantially in the form of Exhibit R
(appropriately completed), with the effectiveness of such Incremental
Lender's Incremental Commitment to occur upon the delivery of such
Incremental Commitment Agreement to the Administrative Agent, the
obtaining of the consents required by Section 2.1(d) (v) and/or (vi),
if and to the extent required pursuant to said clauses, the payment of
any fees required in connection therewith (including, without
limitation, any fees payable pursuant to clause (ii) below) and the
satisfaction of any other conditions precedent that may be set forth in
such Incremental Commitment Agreement;
(ii) the Borrower and its Subsidiaries shall have delivered such
amendments, modifications and/or supplements to the Collateral
Documents as are necessary or, in the reasonable opinion of the
Administrative Agent, desirable to ensure that the additional
Obligations to be incurred pursuant to the Incremental Commitments are
secured by, and entitled to the benefits of, the Collateral Documents;
(iii) the Administrative Agent shall receive an acknowledgment from
the Credit Parties that the Incremental Loans to be incurred pursuant
to such Incremental Commitments are entitled to the benefits of the
Guaranties and the Collateral Documents, together with resolutions
executed by (x) the Borrower, authorizing the incurrence of such
Incremental Loans pursuant to such Incremental Commitments and (y) each
other Credit Party, stating that the Incremental Loans to be incurred
pursuant to such Incremental Commitments are entitled to benefits of
the Guaranties and the Collateral Documents;
(iv) the Borrower shall deliver to the Administrative Agent an
opinion or opinions, in form and substance reasonably satisfactory to
the Administrative Agent, from counsel to the Borrower reasonably
satisfactory to the Administrative Agent and dated the date of such
Incremental Commitment Agreement, covering such of the matters set
forth in the opinions of counsel delivered to the Administrative Agent
on the Initial Borrowing Date pursuant to Section 5.1(c) and such other
matters as the Administrative Agent may reasonably request;
(v) on the date of the making of such Incremental Loans, same
shall be added to (and form part of) each Borrowing of outstanding
Loans of the Tranche under which such Incremental Loans were made on a
PRO RATA basis (based on the relative sizes of the various outstanding
Borrowings under such Tranche), so that each Lender will participate
proportionately in each then outstanding Borrowing of Loans of under
such Tranche, and so that the existing Lenders with respect to such
Tranche continue to have the same participation (by amount) in each
Borrowing as they had before the making of the new Incremental Loans of
such Tranche; and
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(vi) the Administrative Agent shall promptly notify each Lender as
to the effectiveness of each Incremental Commitment Agreement, and
shall deliver to each Lender a copy of same, and (i) at such time
Schedule I shall be deemed modified to reflect the Incremental
Commitments of such Incremental Lenders and (ii) to the extent
requested by such Incremental Lenders, the appropriate Notes will be
issued, at the Borrower's expense, to such Incremental Lenders, to
reflect the Incremental Loans made by such Incremental Lenders or such
Incremental Lender, as the case may be.
To the extent the provisions above contained in clause (e) (v) above
require that Lenders making Incremental Loans add same to then outstanding
Borrowings of Eurodollar Rate Loans, it is acknowledged that the effect thereof
may result in such new Incremental Loans having short Interest Periods (I.E., an
Interest Period that began during an Interest Period then applicable to
outstanding Eurodollar Rate Loans and which will end on the last day of such
Interest Period). In connection therewith, the Borrower may agree, in the
respective Incremental Commitment Agreement, to compensate the Lenders making
the new Incremental Loans of the respective Tranche for funding Eurodollar Rate
Loans during an existing Interest Period on such basis as may be agreed by the
Borrower and their respective Lender or Lenders.
2.2 DETERMINATION OF BORROWING BASE FOR REVOLVING LOANS; ETC. (a)
Subject to Section 2.2(b), Section 2.2(c) and Section 2.3(c), Revolving Loans
shall not in aggregate principal amount at any time outstanding exceed, when
added to the Letter of Credit Obligations at such time, the lesser of:
(i) the Total Revolving Credit Commitments as then in effect; or
(ii) the amount then equal to:
(A) the Adjusted Net Book Value Percentage of all
Eligible Rental Equipment; PLUS
(B) 85% of Eligible Accounts Receivable, minus
(C) the Excess Other Liability Amount at such time, MINUS
(D) the Borrower's exposure (as determined by the
Administrative Agent) under any Interest Rate Agreements, MINUS
(E) the aggregate principal amount of Term Loans
outstanding at such time.
The amount calculated in accordance with clause (ii) above is
hereinafter referred to as the "BORROWING BASE".
(b) The Administrative Agent shall in the exercise of its
Permitted Discretion (x) at any time be entitled to (i) establish and increase
or decrease reserves against Eligible Accounts Receivable and Eligible Rental
Equipment, and (ii) impose additional restrictions (or eliminate the same) to
the standards of "Eligible Accounts Receivable" and "Eligible Rental Equipment"
and (y) at any time after the Effective Date be entitled to reduce the advance
rates
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under Section 2.2(a)(ii)(A) or (B) or restore such advance rates to any level
equal to or below the advance rates stated in Section 2.2(a)(ii)(A) or (B). The
Administrative Agent may, but shall not be required to, rely on each Borrowing
Base Certificate and any other schedules or reports delivered to it in
connection herewith in determining the then eligibility of Accounts and Rental
Equipment. Reliance thereon by the Administrative Agent from time to time shall
not be deemed to limit the right of the Administrative Agent to revise advance
rates or standards of eligibility as provided in this Section 2.2(b).
(c) The Borrowing Base will be computed monthly and a Borrowing
Base Certificate presenting the computation thereof will be delivered promptly
to the Administrative Agent as set forth in Section 7.1(e). Notwithstanding
anything to the contrary contained herein, the Administrative Agent shall be
satisfied that on the Effective Date and after giving effect to the consummation
of the Refinancing, the Borrower shall be able to incur additional Revolving
Outstandings, after giving effect to all Credit Events on the Effective Date, of
$100,000,000 in compliance with the applicable restrictions contained in Section
2.2(a).
2.3 BORROWING MECHANICS. (a) Except as provided in Section 2.3(b)
or (c), Borrowings shall be made on notice from the Borrower to the Payments
Administrator, given not later than 1:00 P.M. (New York City time) on the date
on which the proposed Borrowing consisting of Base Rate Loans is requested to be
made and on the third Business Day prior to the date on which any proposed
Borrowing consisting of Eurodollar Rate Loans is requested to be made.
(i) Each Notice of Borrowing shall be given by either telephone,
telecopy, telex, facsimile or cable, and, if by telephone, confirmed in
writing, substantially in the form of Exhibit B-1 (the "NOTICE OF
BORROWING"), appropriately completed to specify the aggregate principal
amount of the Loans to be made pursuant to such Borrowing, the date of
such Borrowing (which shall be a Business Day), whether the Loans being
made pursuant to such Borrowing shall constitute Term Loans or
Revolving Loans and whether the Loans being made pursuant to such
Borrowing are to be initially maintained as Base Rate Loans or
Eurodollar Rate Loans and, if Eurodollar Rate Loans, the initial
Interest Period to be applicable thereto. The Payments Administrator
shall promptly give each Lender which is required to make such Loan of
the Tranche specified in the respective Notice of Borrowing, notice of
such proposed Borrowing, of such Lender's proportionate share thereof
and of the other matters required by the immediately preceding sentence
to be specified in the Notice of Borrowing. Each Notice of Borrowing
shall be irrevocable by and binding on the Borrower.
(ii) The Borrower shall notify the Payments Administrator in
writing of the names of the officers authorized to request the Loans on
behalf of Borrower, and shall provide the Payments Administrator with a
specimen signature of each such officer. The Payments Administrator
shall be entitled to rely conclusively on such officers' authority to
request the Loans on behalf of the Borrower until the Payments
Administrator receives written notice to the contrary. The Payments
Administrator shall have no duty to verify the authenticity of the
signature appearing on any Notice of Borrowing or other writing
delivered pursuant to this Section 2.3(a) and, with respect to an oral
request for the Loans, the Payments Administrator shall have no duty to
verify the identity of any
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individual representing himself as one of the officers authorized to
make such request on behalf of the Borrower. Neither the Payments
Administrator nor any of the Lenders shall incur any liability to the
Borrower as a result of acting upon any telephonic notice referred to
in this Section 2.3(a) which notice the Payments Administrator believes
in good faith to have been given by a duly authorized officer or other
individual authorized to request the Loans on behalf of the Borrower or
for otherwise acting reasonably and in good faith under this Section
2.3(a) and, upon the funding of the Loans by the Lenders in accordance
with this Credit Agreement, pursuant to any such telephonic notice, the
Borrower shall be deemed to have made a Borrowing of the Loans
hereunder.
(iii) In a Notice of Borrowing, the Borrower may request one or more
Borrowings on a single day. Each such Borrowing shall, unless otherwise
specifically provided therein, consist entirely of Loans of the same
Type and shall be in an aggregate amount for all Lenders of not less
than $1,000,000 in the case of Eurodollar Rate Loans. Unless otherwise
requested in the applicable Notice of Borrowing, all Loans shall be
Base Rate Loans. All Term Loans and Revolving Loans made on the
Effective Date shall initially be Base Rate Loans and thereafter may be
continued as Base Rate Loans or converted into Eurodollar Rate Loans,
in the manner provided in Section 4.3(b). The right of the Borrower to
choose Eurodollar Rate Loans is subject to the provisions of Section
2.3(a)(v) and 4.3(c).
(iv) Upon the Payments Administrator's receipt of one or more
Notices of Borrowing with respect to the Loans to be made on any given
date, the Payments Administrator shall give each Lender prompt notice
by telephone or facsimile transmission of such Notice of Borrowing.
Subject to the reasonable determination by the Payments Administrator
that the applicable conditions for borrowing contained in Article 5 are
satisfied, (x) each Term Loan Lender shall make available to the
Payments Administrator at the Payment Office its Term Loan
Proportionate Share of the Term Loans (if any) to be made on such date,
in immediately available funds no later than 3:00 P.M. New York City
time on such date and (y) each Revolving Credit Lender shall make
available to the Payments Administrator at the Payment Office its
Revolving Credit Proportionate Share of the aggregate amount of
Revolving Loans to be made on such date, in immediately available funds
no later than 3:00 P.M. New York City time on such date.
Notwithstanding the foregoing, Incremental Loans to be made on any date
shall be made in accordance with the relevant provisions of Section 2.1
Unless the Payments Administrator receives contrary written notice
prior to (unless the Initial Borrowing Date is the date of such
Borrowing, in which case no later than 11:00 A.M. (New York City time)
on the Initial Borrowing Date) of any Borrowing, it is entitled to
assume that each Lender will make available the amounts specified above
and, in reliance upon such assumption, but without any obligation to do
so, the Payments Administrator may advance such amounts on behalf of
the Lenders (with the Lenders being obligated to the Payments
Administrator for any such advances in accordance with the provisions
of Section 2.4(c)).
(v) Notwithstanding the foregoing, prior to the Syndication Date,
Loans may only be incurred and maintained as, and/or Converted into,
Eurodollar Rate Loans as long as such Loans, together with all other
outstanding Eurodollar Rate Loans are subject to a
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one-month Interest Period which, in each case, begins and ends on the
same day, with the first of such Interest Periods not to begin prior to
the third Business Day following the Initial Borrowing Date.
(b) The Borrower has informed the Administrative Agent that it has
a checking account (such checking account, together with any other checking
accounts established as contemplated in the last sentence of this clause (b)
collectively, the "DISBURSEMENT ACCOUNT") with Bank of America for general
corporate purposes, including the purpose of paying trade payables and other
operating expenses. The Lenders hereby authorize the Payments Administrator and,
so long as the conditions for Borrowing in Article 5 remain satisfied, the
Payments Administrator on behalf of the Lenders may but shall not be obligated
to make Revolving Loans to cover the amount of checks presented for payment and
other disbursements from the Disbursement Account. Such Borrowings shall be of
Base Rate Loans only and will at no time exceed the amount available for the
Borrowing of Revolving Loans under Section 2.2 (as determined in good faith by
the Administrative Agent). The Borrower may open additional checking accounts
with financial institutions satisfactory to the Payments Administrator so long
as each such checking account constitutes a Deposit Account (as defined in the
U.S. Security Agreement) and is subject to a Control Agreement as provided in
the U.S. Security Agreement.
(c) In the event the Borrower is unable to comply with (i) the
Borrowing Base limitations set forth in Section 2.2(a) or (ii) the conditions
precedent to the making of a Revolving Loan or the issuance of a Letter of
Credit set forth in Section 5.2, the Lenders authorize the Payments
Administrator, for the account of the Lenders, to make Revolving Loans (the
"AGENT ADVANCES") to the Borrower for a period commencing on the date the
Payments Administrator first receives a Notice of Borrowing requesting an Agent
Advance until the earlier of (i) the fifteenth Business Day after such date,
(ii) the date the Borrower is again able to comply with the Borrowing Base
limitations and the conditions precedent to the making of Revolving Loans and
issuance of Letters of Credit, or obtains an amendment or waiver with respect
thereto or (iii) the date the Required Lenders instruct the Payments
Administrator to cease making Agent Advances (in each case, the "AGENT ADVANCE
PERIOD"). The Payments Administrator shall not make any Agent Advance (i) to the
extent that at such time the amount of such Agent Advance when added to the
aggregate outstanding amount of other Agent Advances would exceed the lesser of
(x) the remainder of the Total Revolving Credit Commitments at such time LESS
the Revolving Outstandings at such time and (y) 10% of the Revolving
Outstandings at the time or of the first request for an Agent Advance during the
related Agent Advance Period or (ii) if the Administrative Agent believes that
the making of the respective Agent Advance may cause a violation of the relevant
provisions of the Senior Unsecured Notes Indenture (it being understood and
agreed that the Administrative Agent may, but shall not be required to, require
such officer's certificates and/or opinions of counsel from the Borrower to the
effect that no such violation of the Senior Unsecured Notes Indenture shall
occur as a result of the making of the respective Agent Advance). It is
understood and agreed that, subject to the requirements set forth above, Agent
Advances may be made by the Payments Administrator in its discretion and that
the Borrower shall have no right to require that any Agent Advances be made.
Agent Advances will be subject to periodic settlement with the Lenders under
Section 2.4.
2.4 SETTLEMENTS AMONG THE PAYMENTS ADMINISTRATOR AND THE LENDERS.
(a) Except as provided in Section 2.4(b), the Payments Administrator shall give
to each Lender prompt
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notice of each Notice of Borrowing by telecopy, telex, facsimile or cable. No
later than 3:00 P.M. (New York City time) on the date of each Borrowing
representing the incurrence of Revolving Loans (each a "RL BORROWING DATE"),
each Lender with a Revolving Credit Commitment will make available, from the
account of its Applicable Lending Office, to the Payments Administrator at its
Payment Office, in immediately available funds, for the account of the Borrower,
its Revolving Credit Proportionate Share of such Borrowing. To the extent the
Lenders have made such amounts available to the Payments Administrator as
provided above, the Payments Administrator will make the aggregate of such
amounts available to the Borrower by 4:00 P.M., New York time, on the respective
RL Borrowing Date in accordance with this Section 2.4 and in like funds received
by the Payments Administrator. Unless the Payments Administrator shall have been
notified by any Lender prior to the date of such Borrowing that such Lender does
not intend to make available to the Payments Administrator its portion of such
Borrowing to be made on such date, the Payments Administrator may assume that
such Lender will make such amount available to the Payments Administrator at its
Payment Office on such date of Borrowing, or, if applicable, the Settlement Date
and the Payments Administrator, in reliance upon such assumption, may but shall
not be obligated to make available the amount of the Borrowing to be provided by
such Lender. Except as provided in Section 2.4(b) and subject to Section 2.4(e),
promptly after its receipt of payments from or on behalf of the Borrower (other
than amounts payable to the Administrative Agent to reimburse the Administrative
Agent, the Collateral Agent and the Issuing Lender for fees and expenses payable
solely to them), the Payments Administrator will cause such payments to be
distributed ratably to the Lenders.
(b) Unless the Required Lenders have instructed the Payments
Administrator to the contrary, the Payments Administrator on behalf of the
Lenders may but shall not be obligated to make Base Rate Loans under Section 2.3
without prior notice of the proposed Borrowing to the Lenders, as follows:
(i) The amount of each Revolving Credit Lender's Revolving Credit
Proportionate Share of outstanding Revolving Loans shall be computed
weekly (or more frequently in the Payments Administrator's discretion)
and shall be adjusted upward or downward on the basis of the amount of
outstanding Revolving Loans as of 5:00 P.M. (New York City time) on the
last Business Day of the period specified by the Payments Administrator
(such date, the "SETTLEMENT DATE"). The Payments Administrator shall
deliver to each of the Revolving Credit Lenders promptly after the
Settlement Date a summary statement of the amount of outstanding
Revolving Loans for such period. The Revolving Credit Lenders shall
transfer to the Payments Administrator, or, subject to Section 2.4(e),
the Payments Administrator shall transfer to the Revolving Credit
Lenders, such amounts as are necessary so that (after giving effect to
all such transfers) the amount of Revolving Loans made by each
Revolving Credit Lender shall be equal to such Revolving Credit
Lender's Revolving Credit Proportionate Share of the aggregate amount
of Revolving Loans outstanding as of such Settlement Date. If the
summary statement is received by the Revolving Credit Lenders prior to
12:00 Noon (New York City time) on any Business Day, each Revolving
Credit Lender shall make the transfers described above in immediately
available funds no later than 3:00 P.M. (New York City time) on the day
such summary statement was received; and if such summary statement is
received by the Lenders after 12:00 Noon (New York City time) on such
day, each Revolving Credit Lender shall make such transfers no later
than 3:00 P.M. (New York
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City time) on the next succeeding Business Day. The obligation of each
of the Revolving Credit Lenders to transfer such funds shall be
irrevocable and unconditional and without recourse to or warranty by
the Payments Administrator. Each of the Payments Administrator and the
Revolving Credit Lenders agree to ▇▇▇▇ their respective books and
records on the Settlement Date to show at all times the dollar amount
of their respective Revolving Credit Proportionate Shares of the
outstanding Revolving Loans.
(ii) To the extent that the settlement described above shall not
yet have occurred, upon any repayment of Revolving Loans by the
Borrower, the Payments Administrator may apply such amounts repaid
directly to the amounts made available by the Payments Administrator
pursuant to this Section 2.4(b).
(iii) Because the Payments Administrator on behalf of the Revolving
Credit Lenders may be advancing and/or may be repaid Revolving Loans
prior to the time when the Revolving Credit Lenders will actually
advance and/or be repaid Revolving Loans, interest with respect to
Revolving Loans shall be allocated by the Payments Administrator to
each Revolving Credit Lender and the Payments Administrator in
accordance with the amount of Revolving Loans actually advanced by and
repaid to each Revolving Credit Lender and the Payments Administrator
and shall accrue from and including the date such Revolving Loans are
so advanced to but excluding the date such Revolving Loans are either
repaid by the Borrower in accordance with Section 2.5 or actually
settled by the applicable Lender as described in this Section 2.4(b).
(c) If a Lender (such a Lender a "DEFAULTING LENDER") fails to
make available to the Payments Administrator its Proportionate Share of any
Loans (including Agent Advances) made available by the Payments Administrator on
such Lender's behalf, or fails to make available any other amount owing by it to
the Payments Administrator and the Payments Administrator has made such amount
available to the Borrower, the Payments Administrator shall be entitled to
recover such amount on demand from such Defaulting Lender. If such Defaulting
Lender does not pay such amount forthwith upon the Payments Administrator's
demand therefor, the Payments Administrator shall promptly notify the Borrower
and the Borrower shall promptly (but in any event no later than five Business
Days after such demand) pay such amount (to the extent not paid by the
Defaulting Lender) to the Payments Administrator. The Payments Administrator
shall also be entitled to recover from such Defaulting Lender or the Borrower,
as the case may be, (x) interest on such amount in respect of each day from the
date such corresponding amount was made available by the Payments Administrator
to the Borrower to the date such amount is recovered by the Payments
Administrator, at a rate PER ANNUM equal to either (i) if paid by such
Defaulting Lender, the overnight Federal Funds Rate for the first three days and
at the interest rate otherwise applicable to such Loans for each day thereafter
or (ii) if paid by the Borrower, the then applicable rate of interest,
calculated in accordance with Section 4.1 or Section 4.2 hereof, PLUS (y) in
each case, an amount equal to any costs (including reasonable legal expenses)
and losses incurred as a result of the failure of such Defaulting Lender to
provide such amount as provided in this Credit Agreement; PROVIDED, HOWEVER,
that the Payments Administrator shall not be entitled to demand payment by the
Borrower of any amount under clause (y) above unless demand therefor has been
made of the Defaulting Lender and not paid within five Business Days of such
demand. Nothing herein shall be deemed to relieve any Lender from its duty to
fulfill its obligations hereunder or
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to prejudice any rights which the Borrower may have against any Lender as a
result of any default by such Lender hereunder, including, without limitation,
the right of the Borrower to seek reimbursement from any Defaulting Lender for
any amounts paid by the Borrower under clause (y) above on account of such
Defaulting Lender's default.
(d) The failure of any Lender to fund its Proportionate Share of
any Loan (including Agent Advances) made by it as part of any Borrowing shall
not relieve any other Lender of its obligation, if any, hereunder to fund its
Proportionate Share of such Loan on the date of such Borrowing, or relieve the
Lender who failed to make such amount available to subsequently repay such
amount, or relieve any Lender (including the Lender that failed to make such
amount available) of its obligation hereunder to make its ratable portion of any
Borrowing available as part of any subsequent Loans, but no Lender shall be
responsible for the failure of any other Lender to fund its Proportionate Share
of a Loan.
(e) Notwithstanding anything contained herein to the contrary, so
long as any Revolving Credit Lender is a Defaulting Lender or has rejected or
repudiated its Revolving Credit Commitment, the Payments Administrator shall not
be obligated to transfer to such Lender any payments made by the Borrower to the
Payments Administrator for the benefit of such Lender (excluding such payments
made in respect of the Term Loans); and such Lender shall not be entitled to the
sharing of any payments (excluding such payments made in respect of the Term
Loans) pursuant to Section 2.10. Amounts which would have been payable to such
Lender in the absence of the immediately preceding sentence shall instead be
paid to the Payments Administrator. The Payments Administrator may hold and, in
its discretion, re-lend to the Borrower the amount of all such payments received
by it for such Lender. For purposes of voting or consenting to matters with
respect to the Credit Documents, each Defaulting Lender shall be deemed not to
be a "Lender" and such Lender's Revolving Credit Commitment (and related
Outstandings) and Term Loan Outstandings, as applicable, shall be deemed to be
zero. This Section 2.4(e) shall remain effective with respect to such Defaulting
Lender until (x) the Obligations under this Credit Agreement shall have been
paid in full to the Payments Administrator and/or the Lenders other than the
Defaulting Lender or (y) the Required Lenders, the Payments Administrator and
the Borrower shall have waived such Defaulting Lender's default in writing. No
Commitment of any Lender shall be increased or otherwise affected, and
performance by the Borrower shall not be excused, by the operation of this
Section 2.4(e).
2.5 MANDATORY AND VOLUNTARY PAYMENTS: MANDATORY AND VOLUNTARY
REDUCTION OF COMMITMENTS.
(a) AMORTIZATION OF TERM LOANS. In addition to any other mandatory
repayments or commitment reductions pursuant to this Section 2.5, on each date
set forth below, the Borrower shall be required to repay that principal amount
of Term Loans (as adjusted pursuant to the last sentence of this Section
2.5(a)), to the extent then outstanding, as is set forth opposite such date
(each such repayment, a "Scheduled Repayment", and each such date, a "Scheduled
Repayment Date"):
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TERM LOAN
SCHEDULED REPAYMENT DATE AMOUNT
------------------------ ------
The last Business Day of $525,000
June, 2002
The last Business Day of $525,000
September, 2002
The last Business Day of $525,000
December, 2002
The last Business Day of $525,000
March, 2003
The last Business Day of $525,000
June, 2003
The last Business Day of $525,000
September, 2003
The last Business Day of $525,000
December, 2003
The last Business Day of $525,000
March, 2004
The last Business Day of $525,000
June, 2004
The last Business Day of $525,000
September, 2004
The last Business Day of $525,000
December, 2004
The last Business Day of $525,000
March, 2005
The last Business Day of $525,000
June, 2005
The last Business Day of $525,000
September, 2005
The last Business Day of $525,000
December, 2005
The last Business Day of $525,000
March, 2006
The last Business Day of $525,000
June, 2006
The last Business Day of $525,000
September, 2006
Maturity Date $200,550,000
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Notwithstanding anything to the contrary contained above, on each date after the
Effective Date upon which any Incremental Term Loans are actually made, each
then remaining Scheduled Repayment (as then in effect) shall be increased by an
amount equal to (x) the aggregate principal amount of Incremental Term Loans
actually made on such date, multiplied by (y) a fraction the numerator of which
is the amount of the respective Scheduled Repayment (as then in effect) and the
denominator of which is the aggregate principal amount of Term Loans outstanding
immediately before the incurrence of Incremental Term Loans on such date.
(b) VOLUNTARY PREPAYMENT OF TERM LOANS. Subject to Section 2.5(c)
and the last sentence of this Section 2.5(b), the Borrower may, without premium
or penalty, prepay Term Loans by giving the Administrative Agent at least (x)
one Business Day's prior written notice in the case of Term Loans constituting
Base Rate Loans and (y) at least three Business Days' notice in the case of Term
Loans constituting Eurodollar Loans (which notice the Administrative Agent shall
promptly transmit to each Term Loan Lender), PROVIDED that, in the case of Term
Loans constituting Eurodollar Rate Loans, any payment required to be made
pursuant to Section 4.5(b) as a result of such prepayments shall have been, or
shall concurrently therewith be, made. Unless the aggregate Term Loan
Outstandings are to be prepaid in full, voluntary prepayments of the Term Loans
shall be in an aggregate minimum amount of $1,000,000 and in increments of
$500,000 in excess of such amount. Each voluntary prepayment shall be applied to
the unpaid installments of the Term Loans in the inverse order of maturity and
shall permanently reduce the Term Loan Outstandings of each Term Loan Lender
ratably in accordance with its Term Loan Proportionate Share. Any notice of
prepayment given to the Administrative Agent under this Section 2.5(b) shall
specify the date (which shall be a Business Day) of prepayment, the aggregate
principal amount of the prepayment and the Types of Term Loans to be prepaid,
and in the case of Eurodollar Loans, the specific Borrowing or Borrowings
pursuant to which made. When notice of prepayment is delivered as provided
herein, the principal amount of the Term Loans specified in the notice shall
become due and payable on the prepayment date specified in such notice.
Notwithstanding anything to the contrary contained above, unless the Required
Lenders otherwise specifically consent in writing thereto (or the Revolving
Credit Termination Date has occurred or will occur concurrently with such
prepayment), no voluntary prepayment of Term Loans may be made pursuant to this
Section 2.5(b) unless, after giving effect thereto, the Borrower shall be able
to incur additional Revolving Outstandings of $50,000,000 or more in compliance
with the Total Revolving Credit Commitments and the Borrowing Base restrictions
as then in effect.
(c) NO READVANCE OF TERM LOANS. Any repayment or prepayment of all
or any portion of the principal amount of the Term Loans shall constitute a
permanent reduction in the Term Loan Outstandings and may not be readvanced to
the Borrower.
(d) MANDATORY PAYMENT OF REVOLVING LOANS. Revolving Loans shall be
due and payable without any demand at any time that the aggregate balance of
Revolving Loans and all Letter of Credit Obligations outstanding at such time
exceeds the lesser of the Borrowing Base then in effect and the Total Revolving
Credit Commitments then in effect, in the amount of such excess, PROVIDED that
(i) no such payment shall be required pursuant to the foregoing clause as a
result of a Borrowing Base Deficiency during an Agent Advance Period (although
to the extent the amount of Revolving Loans and Letter of Credit Obligations
exceeds the amount permitted to be outstanding pursuant to the Senior Unsecured
Notes Indenture or to the extent
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there exists an excess over the Total Revolving Credit Commitments then in
effect, each such payment shall be required to be made immediately and whether
or not an Agent Advance Period is in existence) and (ii) if the then aggregate
outstanding principal amount of Revolving Loans is less than such excess (it
being understood and agreed that such excess shall be calculated after giving
effect to the foregoing clause (i)), Letters of Credit will be required to be
cash collateralized (to the satisfaction of the Collateral Agent) in the amount
of such difference.
(e) TERMINATION AND REDUCTIONS OF COMMITMENTS.
(i) The Total Commitments (and the Commitment of each Lender)
shall terminate on April 30, 2002, unless the Initial Borrowing Date
shall have occurred on or before such date.
(ii) On the Initial Borrowing Date (immediately after giving effect
to the making of Term Loans on such date), the Total Term Loan
Commitments (and the Term Loan Commitment of each Lender) shall
terminate.
(iii) The Incremental Term Loan Commitment of each Lender provided
pursuant to a particular Incremental Commitment Agreement shall be
permanently reduced on each Incremental Borrowing Date on which
Incremental Term Loans are incurred pursuant to such Incremental
Commitment Agreement in an amount equal to the aggregate principal
amount of Incremental Term Loans made by such Lender pursuant to such
Incremental Commitment Agreement on such date. In addition, (x) the
Incremental Term Loan Commitment of each Lender provided pursuant to a
particular Incremental Commitment Agreement shall terminate at 5:00
P.M. (New York City time) on the earlier of (i) the date specified in
such Incremental Commitment Agreement and (ii) the second Business Day
following the date of effectiveness of such Incremental Commitment
Agreement (whether or not any Incremental Term Loans are incurred on
either such date) and (y) unless the Required Lenders otherwise agree
in writing in their sole discretion, any then existing Incremental Term
Loan Commitments shall terminate in their entirety on the date on which
a Change in Control occurs.
(iv) On the earlier of (x) the Maturity Date and (y) unless the
Required Lenders otherwise consent in writing, the date on which a
Change of Control occurs, the Total Revolving Credit Commitments (and
the Revolving Credit Commitment of each Revolving Credit Lender) shall
terminate.
(v) On each date upon which a mandatory repayment of Term Loans
pursuant to Section 2.5(i), (j), (k) or (l) is required (and exceeds in
amount the aggregate principal amount of Term Loans then outstanding)
or would be required if Term Loans were then outstanding, the Total
Revolving Credit Commitments shall be permanently reduced by the
amount, if any, by which the amount required to be applied pursuant to
said Sections (determined as if an unlimited amount of Term Loans were
actually outstanding) exceeds the aggregate principal amount of Term
Loans then outstanding.
(f) VOLUNTARY PREPAYMENT OF REVOLVING LOANS. In addition to the
transfers and distributions of funds required pursuant to Section 2.6, the
Borrower shall have the right to
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prepay the Revolving Loans, without premium or penalty, in whole or in part at
any time and from time to time on the following terms and conditions: (i) the
Borrower shall give the Administrative Agent prior to 12:00 Noon (New York City
time) (x) at least one Business Day's prior written notice (or telephonic notice
promptly confirmed in writing) of its intent to prepay Base Rate Loans and (y)
at least three Business Days' prior written notice (or telephonic notice
promptly confirmed in writing) of its intent to prepay Eurodollar Rate Loans,
the amount of such prepayment and the Types of Loans to be prepaid and, in the
case of Eurodollar Rate Loans, the specific Borrowing or Borrowings pursuant to
which made, which notice the Administrative Agent shall promptly transmit to
each of the Lenders; and (ii) prepayments of Eurodollar Rate Loans made on a day
other than the last day of an Interest Period applicable thereto shall be
accompanied by any amounts owing pursuant to Section 4.5(b).
(g) APPORTIONMENT AND APPLICATION OF PAYMENTS AND REDUCTIONS TO
TOTAL COMMITMENTS.
(i) With respect to each repayment of Loans pursuant to this
Section 2.5, the Borrower may designate the Types of Loans which are to
be repaid and the specific Borrowing(s) pursuant to which made;
PROVIDED that (i) if Eurodollar Rate Loans are repaid on a day that is
other than the last day of an Interest Period applicable thereto, such
repayment shall be accompanied by any amounts owing pursuant to Section
4.5(b); (ii) if any partial prepayment of Eurodollar Rate Loans made
pursuant to any Borrowing shall reduce the outstanding Eurodollar Rate
Loans made pursuant to such Borrowing to an amount less than
$1,000,000, then such Borrowing may not be continued as a Borrowing of
Eurodollar Rate Loans and any election of an Interest Period with
respect thereto given by the Borrower shall have no force or effect;
and (iii) each repayment of any Loans made pursuant to a Borrowing
shall, except as provided in Section 2.4(e) and (in the case of Term
Loans) subject to the provisions of Section 2.5(n), be applied PRO RATA
among the Lenders which made such Loans. If the Borrower is required to
repay any Eurodollar Rate Loans as a result of the application of
Section 2.5(i), (j), (k) or (l) and such prepayment will result in the
Borrower being required to pay breakage costs under Section 4.5(b) (any
such Eurodollar Rate Loans, "AFFECTED LOANS"), the Borrower may elect,
by written notice to the Administrative Agent, to have the provisions
of the following sentence be applicable. At the time any Affected Loans
are otherwise required to be prepaid the Borrower may elect to deposit
100% (or such lesser percentage elected by the Borrower as not being
immediately repaid) of the principal amounts that otherwise would have
been paid in respect of the Affected Loans with the Administrative
Agent to be held as security for the obligations of the Borrower
hereunder for a period not to exceed 60 days pursuant to a cash
collateral agreement to be entered into in form and substance
satisfactory to the Administrative Agent, with such cash collateral to
be released from such cash collateral account (and applied to repay the
principal amount of such Eurodollar Rate Loans) upon each occurrence
thereafter of the last day of an Interest Period applicable to
Eurodollar Rate Loans of the respective Tranche (or such earlier date
or dates as shall be requested by the Borrower), with the amount to be
so released and applied on the last day of each Interest Period to be
the amount of such Eurodollar Rate Loans (excluding any such Eurodollar
Rate Loans which are Term Loans to the extent the respective Term Loan
Lenders have waived their rights to receive such payment in accordance
with the provisions of Section 2.5(n)) to which such Interest Period
applies
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(or, if less, the amount remaining in such cash collateral account);
PROVIDED that on the 90th day after the deposit thereof, any amount
remaining from the respective deposit pursuant to the cash collateral
account shall be applied to repay outstanding Term Loans which would
otherwise have been repaid in the absence of this sentence. In the
absence of a designation by the Borrower as described in the first
sentence of this clause (g)(i), each repayment of Loans pursuant to
Section 2.5 shall be applied first to the payment of Base Rate Loans
and second to the payment of Eurodollar Rate Loans in the order of the
Interest Periods applicable thereto soonest to end. If there is more
than one Eurodollar Rate Loan maturing on any one date, then, in the
absence of contrary instructions from the Borrower, (i) if such
Eurodollar Rate Loans bear interest at different rates, payment shall
be applied to the Eurodollar Rate Loans bearing the higher rate of
interest and (ii) if such Eurodollar Rate Loans bear interest at the
same interest rate, payment shall be applied to whichever Eurodollar
Rate Loan the Administrative Agent shall select in its sole discretion.
(ii) Any reduction to the Total Revolving Credit Commitments
pursuant to this Section 2.5 shall reduce the Revolving Credit
Commitment of each of the Revolving Credit Lenders PRO RATA (based on
each Revolving Credit Lender's Revolving Credit Proportionate Share).
(iii) Any prepayment of Term Loans pursuant to this Section 2.5
(excluding Section 2.5(a) hereof) and Section 7.10 shall be applied to
reduce the then remaining unpaid principal amounts of such Scheduled
Repayments on a PRO RATA basis (based upon the then remaining unpaid
principal amount of such Scheduled Repayments after giving effect to
all prior reductions thereto) and shall permanently reduce the Term
Loan Outstandings of each Term Loan Lender ratably in accordance with
its Term Loan Proportionate Share.
(h) VOLUNTARY REDUCTION OF REVOLVING CREDIT COMMITMENTS. The
Borrower may permanently reduce or terminate the unutilized Total Revolving
Credit Commitments at any time and from time to time in whole or in part upon at
least three Business Days' prior written notice to the Administrative Agent;
provided, however, that each such reduction must be in an amount not less than
$250,000 (and in increments of $50,000 if in excess thereof); and provided
further, that (i) if the Borrower seeks to reduce the Total Revolving Credit
Commitments to an amount less than $10,000,000, then the Total Revolving Credit
Commitments shall be reduced to zero and (ii) once reduced, the amount of any
such reductions in the Total Revolving Credit Commitments may not be reinstated.
(i) MANDATORY COMMITMENT REDUCTIONS AND PREPAYMENTS RELATING TO
ISSUANCES OF DEBT. In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 2.5, on the date of the receipt of any cash
proceeds by Holdings, the Borrower or any of their respective Subsidiaries from
the incurrence of Indebtedness by Holdings, the Borrower or any of their
respective direct or indirect Subsidiaries (other than Indebtedness permitted to
be incurred under Section 8.3 as in effect on the Effective Date), an amount
equal to 100% of such Net Debt Proceeds therefrom shall be applied to repay
outstanding Term Loans in accordance with the requirements of Section
2.5(g)(iii).
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(j) MANDATORY PREPAYMENTS RELATING TO ASSET SALES. In addition to
any other mandatory repayments or commitment reductions pursuant to this Section
2.5, on each date after the Effective Date upon which Holdings, the Borrower or
any of their respective Subsidiaries receives any cash proceeds from any Asset
Sale (including capital stock and securities held by any such Person, but
excluding (i) Asset Sales so long as, and to the extent that, the aggregate
amount of Net Sale Proceeds from all Asset Sales excluded pursuant to this
clause (i) during the respective fiscal year of the Borrower in which the Net
Sale Proceeds are received does not exceed $5,000,000, (ii) sales of Rental
Equipment in the ordinary course of business and consistent with past practices,
(iii) sales or other dispositions of assets which do not constitute Collateral,
and (iv) sales of Real Property under Section 8.1(k), to the extent that the
Borrower has delivered a certificate to the Administrative Agent on or prior to
such date stating that it intends to reinvest the Net Sale Proceeds therefrom in
Inventory, replacement equipment, Rental Equipment, or property, plant and
equipment as the case may be, within 180 days after the respective date of sale
or disposition or, in lieu thereof, commit to so invest such Net Sale Proceeds
within 180 days after such date of sale and actually expend the funds pursuant
to such commitment within 365 days after such date of sale or disposition), an
amount equal to 100% of the Net Sale Proceeds from such Asset Sale shall be
applied to repay outstanding Term Loans in accordance with the requirements of
Section 2.5(g)(iii); provided that to the extent any Net Sale Proceeds are not
required to be applied pursuant to this Section 2.5(j) as a result of clause
(iv) contained in the parenthetical above, then (x) on the 180th day after the
date of the respective sale or disposition, the Net Sale Proceeds of the
respective sale or disposition shall be applied as otherwise required by this
Section 2.5(j) to the extent not actually used or committed to be used as
contemplated by said clause (iv) by such 180th day and (y) on the 365th day
after the date of the respective sale or disposition, any Net Sale Proceeds of
the respective sale or disposition shall be applied as otherwise required by
this Section 2.5(j) to the extent same were committed to be used within 180 days
after the respective date of sale or other disposition but were not in fact used
by such 365th day as contemplated by said clause (iv).
(k) MANDATORY PREPAYMENTS RELATING TO EQUITY ISSUANCES. In
addition to any other mandatory repayments or commitment reductions pursuant to
this Section 2.5, on each date after the Effective Date upon which (x) Holdings
receives any cash proceeds from any Public Equity Offering or (y) the Borrower
or any Subsidiary of Holdings or the Borrower receives any cash proceeds from
any Equity Issuance by the Borrower or any Subsidiary of Holdings or the
Borrower, an amount equal to the Applicable Equity Recapture Percentage of the
Net Equity Proceeds therefrom shall be applied to repay outstanding Term Loans
in accordance with the requirements of Section 2.5(g)(iii).
(l) MANDATORY PREPAYMENTS RELATING TO CASUALTY LOSSEs. In addition
to any other mandatory repayments pursuant to this Section 2.5, to the extent
Holdings, the Borrower or their respective Subsidiaries receives proceeds from a
Casualty Loss, such proceeds shall, to the extent provided in Section 7.10, be
applied as to repay Term Loans in accordance with the requirements of
2.5(g)(iii).
(m) MATURITY DATE; CHANGE OF CONTROl. Upon the earlier of (i) the
Maturity Date and (ii) unless the Required Lenders otherwise consent in writing,
the date on which a Change of Control occurs, all then outstanding Loans shall
be repaid in full.
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(n) SPECIAL APPLICATION PROVISIONS REGARDING TERM LOANS. So long
as any Term Loans remain outstanding and so long as (and to the extent that) the
Total Revolving Credit Commitments remain in effect, any amounts required to be
applied as mandatory repayments to the Term Loans pursuant to Sections 2.5(i),
(j), (k) and (l) shall be deposited with the Administrative Agent on the date
the respective payment is otherwise required to be made and, unless the Borrower
has already furnished the Administrative Agent at least three Business Days'
prior written notice of the respective prepayment and amount thereof, the
Administrative Agent shall not apply such amount to repay outstanding Term Loans
until the third Business Day after its receipt of such amounts. Prior thereto,
the Administrative Agent shall give each Term Loan Lender notice of the amount
of the respective repayment to be made to its Term Loans pursuant to the
provisions of said Section 2.5(i), (j), (k) or (l), as the case may be. Such
amount shall be applied to repay the outstanding Term Loans of the various Term
Loan Lenders in accordance with the provisions of this Section 2.5 on the date
of receipt of such payment (if at least three Business Days' notice had
previously been given to the Term Loan Lenders of such prepayment by the
Borrower) or on the third Business Day after the Administrative Agent's receipt
thereof; provided that, by written notice of any Term Loan Lender delivered to
the Administrative Agent at least one Business Day before the date the
respective repayment is actually applied to outstanding Term Loans, any Term
Loan Lender may decline to receive its share of the amount which would otherwise
have been applied to its outstanding Term Loans, in which case such declined
amount shall instead be applied as a mandatory reduction of the Total Revolving
Credit Commitments in accordance with the requirements of Section 2.5(g)(ii).
2.6 PAYMENTS AND COMPUTATIONS. (a) The Borrower shall make each
payment hereunder and under the Notes not later than 1:00 P.M. New York City
time on the day when due in Dollars to the Payments Administrator at its Payment
Office in immediately available funds. The Borrower's obligations to the Lenders
with respect to such payments shall be discharged by making such payments to the
Payments Administrator pursuant to this Section 2.6.
(b) (i) The Borrower and each of its Subsidiaries that is a U.S.
Credit Party shall each, along with the Collateral Agent and financial
institutions selected by the Borrower and acceptable to the Administrative Agent
(the "COLLECTION BANKS"), enter into and maintain an agreement substantially in
the form of Exhibit C-1 or such other form as may be acceptable to the
Collateral Agent (each such agreement, with such changes as may be agreed to by
the Collateral Agent and as modified, amended or supplemented from time to time,
a "COLLECTION BANK AGREEMENT" and, collectively, the "COLLECTION BANK
AGREEMENTS"). The Borrower and each of its Subsidiaries that is a U.S. Credit
Party shall instruct all account debtors on the Accounts of the Borrower or such
Subsidiary, as the case may be, to remit all payments to the applicable "P.O.
Boxes" or "Lockbox Addresses" (as defined in the applicable Collection Bank
Agreement) which remittances shall be collected by the applicable Collection
Bank and deposited in the applicable Collection Account. All amounts received by
the Borrower and each of its Subsidiaries that is a U.S. Credit Party from any
account debtor, in addition to all other cash received from any other source,
shall, subject to the requirements of Sections 8.16 and 8.17, upon receipt be
deposited into a Collection Account.
(ii) The Borrower and its relevant Subsidiaries may close
Collection Accounts and/or open new Collection Accounts with the prior written
consent of the Collateral Agent and subject to prior execution and delivery to
the Collateral Agent of Collection Bank Agreements
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consistent with the provisions of this Section 2.6 and in form and substance
satisfactory to the Administrative Agent.
(c) Upon the terms and subject to the conditions set forth in the
Collection Bank Agreements, all available amounts held in the Collection
Accounts shall be wired by the close of each Business Day into an account
maintained by BTCo (the "CONCENTRATION ACCOUNT") established pursuant to a
concentration account agreement entered into between the Borrower and the
Collateral Agent substantially in the form of Exhibit C-2 (the "CONCENTRATION
ACCOUNT AGREEMENT").
(d) All available amounts held in the Concentration Account shall
be distributed and applied on a daily basis in the following order (in each
case, to the extent the Administrative Agent has actual knowledge of the amounts
owing or outstanding as described below): (1) FIRST, to pay outstanding Expenses
actually due and payable to the Administrative Agent and/or the Collateral Agent
under any of the Credit Documents (provided that, in the case of Expenses
attributable to services provided by third party accountants, consultants,
advisors and other professionals retained by the Administrative Agent or any of
its affiliates, same are invoiced to the Borrower or the Administrative Agent or
its respective affiliate, with a copy of said invoice provided to the Borrower),
and to repay or prepay outstanding Revolving Loans advanced by the
Administrative Agent on behalf of the Lenders pursuant to Sections 2.3 and
2.4(b); (2) SECOND, to the extent all amounts referred to in preceding clause
(1) have been paid in full, to pay all outstanding Expenses actually due and
payable to the Issuing Lender under any of the Credit Documents; (3) THIRD, to
the extent all amounts referred to in preceding clauses (1) and (2) have been
paid in full, to pay (on a ratable basis) all accrued and unpaid interest
actually due and payable on the Loans and all accrued and unpaid Fees actually
due and payable to the Administrative Agent, the Issuing Lenders and the Lenders
under any of the Credit Documents; (4) FOURTH, to the extent all amounts
referred to in preceding clauses (1) through (3), inclusive, have been paid in
full, to prepay (on a ratable basis) all outstanding principal on the Revolving
Loans (whether or not then due and payable and with such application to be made,
first, to outstanding Base Rate Loans and, second, to outstanding Eurodollar
Rate Loans); and (5) FIFTH, to the extent all amounts referred to in preceding
clauses (1) through (4), inclusive, have been paid in full, to pay (on a ratable
basis) all other outstanding Obligations due and payable to the Administrative
Agent, the Collateral Agent or the Lenders under any of the Credit Documents.
(e) Each of the Canadian Subsidiaries shall, along with the
Collateral Agent and one or more financial institutions selected by such
Canadian Subsidiaries and acceptable to the Administrative Agent, enter into and
maintain an agreement (or agreements) substantially in the form of Exhibit C-3
or such other form as Canadian counsel for the Collateral Agent may suggest with
respect to any Canadian Subsidiary or as may otherwise be acceptable to the
Collateral Agent (each such agreement, with such changes as may be agreed to by
the Collateral Agent and as modified, amended or supplemented from time to time,
the "CANADIAN BANK CONTROL AGREEMENT" and, collectively, the "CANADIAN BANK
CONTROL AGREEMENTS").
2.7 MAINTENANCE OF ACCOUNT. Payments Administrator shall maintain
an account on its books in the name of the Borrower in which the Borrower will
be charged with all loans and advances made by the Lenders to the Borrower
pursuant to the Commitments or for the Borrower's account, including the Loans,
the Letter of Credit Obligations, and the Fees,
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Expenses and any other Obligations relating thereto. The Borrower will be
credited, in accordance with Section 2.6 above, with all amounts received by the
Lenders from the Borrower or from others for the Borrower's account, including,
as set forth above, all amounts received by the Payments Administrator in
payment of Accounts and applied to the Obligations. In no event shall prior
recourse to any Accounts or other Collateral be a prerequisite to the Payments
Administrator's right to demand payment of any Obligation upon its maturity.
Further, the Payments Administrator shall have no obligation whatsoever to
perform in any respect any of the Borrower's or any of its Subsidiaries
contracts or obligations relating to the Accounts.
2.8 STATEMENT OF ACCOUNT. After the end of each month the Payments
Administrator shall send the Borrower a statement accounting for the charges,
loans, advances and other transactions occurring among and between the
Administrative Agent, the Revolving Credit Lenders, the Issuing Lender and the
Borrower during that month. The monthly statements shall, absent manifest error,
be an account stated, which is final, conclusive and binding on the Borrower.
2.9 TAXES. (a) All payments made by the Borrower hereunder, under
any Note, or under any other Credit Document will be made without setoff,
counterclaim or other defense. Except as provided in Section 2.9(b), all such
payments will be made free and clear of, and without deduction or withholding
for, any present or future taxes, levies, imposts, duties, fees, assessments or
other charges of whatever nature now or hereafter imposed by any jurisdiction or
by any political subdivision or taxing authority thereof or therein with respect
to such payments (but excluding, except as provided in the second succeeding
sentence, any tax imposed on or measured by the net income or net profits (or
any branch profits taxes imposed in lieu of net income taxes) of the
Administrative Agent or a Lender pursuant to the laws of the jurisdiction in
which the Administrative Agent or such Lender, as the case may be, is organized
or the jurisdiction in which the principal office of such Lender or the
Administrative Agent or the Applicable Lending Office of such Lender is located
or any subdivision or taxing authority thereof or therein) and all interest,
penalties or similar liabilities with respect thereto (all such non-excluded
taxes, levies, imposts, duties, fees, deductions, withholdings, charges,
assessments or other liabilities being referred to collectively as "TAXES"). If
any Taxes are so levied or imposed, the Borrower agrees to pay the full amount
of such Taxes, and such additional amounts as may be necessary so that every
payment of all amounts due hereunder, under any Note, or under any other Credit
Document, after withholding or deduction for or on account of any Taxes, will
not be less than the amount provided for herein or in such Note or such other
Credit Document. If any amounts are payable in respect of Taxes pursuant to the
preceding sentence, the Borrower agrees to reimburse each Lender, upon the
written request of such Lender, for taxes imposed on or measured by the net
income or net profits (or any branch profits taxes imposed in lieu of net income
taxes) of such Lender pursuant to the laws of the jurisdiction in which the
Administrative Agent or such Lender is organized or incorporated or in which the
principal office or Applicable Lending Office of such Lender is located or of
any political subdivision or taxing authority thereof or therein and for any
withholding of income or similar taxes as such Lender shall determine are
payable by, or withheld from, such Lender in respect of such amounts so paid to
or on behalf of such Lender pursuant to this or the preceding sentence. The
Borrower will furnish to the Payments Administrator within 45 days after the
date the payment of any Taxes, or any withholding or deduction on account
thereof, is due pursuant to applicable law certified copies of tax receipts
evidencing such payment by the Borrower. The Borrower will
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indemnify and hold harmless the Administrative Agent and each Lender, and
reimburse the Administrative Agent or such Lender upon its written request, for
the amount of any Taxes so levied or imposed and paid or withheld by the
Administrative Agent or such Lender.
(b) Each Lender that is not a United States person (as such term
is defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax
purposes agrees to deliver to the Borrower and the Administrative Agent on or
prior to the Effective Date, or in the case of a Lender that is an assignee or
transferee of an interest under this Credit Agreement pursuant to Section 11.6
(unless the respective Lender was already a Lender hereunder immediately prior
to such assignment or transfer), on the date of such assignment or transfer to
such Lender, (i) two accurate and complete original signed copies of Internal
Revenue Service Form W-8ECI or Form W-8BEN (with respect to a complete exemption
under an income tax treaty) (or successor forms) certifying to such Lender's
entitlement as of such date to a complete exemption from United States
withholding tax with respect to payments to be made under this Credit Agreement
and under any Note or (ii) if the Lender is not a "bank" within the meaning of
Section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue
Service Form W-8ECI or Form W-8BEN (with respect to a complete exemption under
an income tax treaty) pursuant to clause (i) above, (x) a certificate
substantially in the form of Exhibit D (any such certificate, a "SECTION
2.9(b)(ii) Certificate") and (y) two accurate and complete original signed
copies of Internal Revenue Service Form W-8BEN (with respect to the portfolio
interest exemption) (or successor form) certifying to such Lender's entitlement
as of such date to a complete exemption from United States withholding tax with
respect to payments of interest to be made under this Credit Agreement and under
any Note. In addition, each Lender agrees that from time to time after the
Effective Date, when a lapse in time or change in circumstances renders the
previous certification obsolete or inaccurate in any material respect, it will
deliver to the Borrower and the Administrative Agent two new accurate and
complete original signed copies of Internal Revenue Service Form W-8ECI, Form
W-8BEN (with respect to the benefits of any income tax treaty), or Form W-8BEN
(with respect to the portfolio interest exemption) and a Section 2.9(b)(ii)
Certificate, as the case may be, and such other forms as may be required in
order to confirm or establish the entitlement of such Lender to a continued
exemption from or reduction in United States withholding tax with respect to
payments under this Credit Agreement and any Note, or it shall immediately
notify the Borrower and the Administrative Agent of its inability to deliver any
such Form or Certificate, in which case such Lender shall not be required to
deliver any such Form or Certificate pursuant to this Section 2.9(b).
Notwithstanding anything to the contrary contained in Section 2.9(a), but
subject to Section 11.6 and the immediately succeeding sentence, (x) the
Borrower shall be entitled, to the extent it is required to do so by law, to
deduct or withhold income or similar taxes imposed by the United States (or any
political subdivision or taxing authority thereof or therein) from interest,
fees or other amounts payable hereunder for the account of any Lender which is
not a United States person (as such term is defined in Section 7701(a)(30) of
the Code) for U.S. Federal income tax purposes to the extent that such Lender
has not provided to the Borrower U.S. Internal Revenue Service Forms that
establish a complete exemption from such deduction or withholding and (y) the
Borrower shall not be obligated pursuant to Section 2.9(a) to make any
additional payments to a Lender pursuant to the third and fourth sentences of
Section 2.9(a) (the "GROSS-UP PAYMENTS") (i) if such Lender has not provided to
the Borrower the Internal Revenue Service Forms required to be provided to the
Borrower pursuant to this Section 2.9(b) or (ii) in the case of a payment, other
than interest, to a Lender described in clause (ii) above, to the extent that
such Forms do not establish a complete
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exemption from withholding of such taxes. Notwithstanding anything to the
contrary contained in the preceding sentence or elsewhere in this Section 2.9
and except as set forth in Section 11.6, the Borrower agrees to pay additional
amounts and to indemnify each Lender in the manner set forth in Section 2.9(a)
(without regard to the identity of the jurisdiction requiring the deduction or
withholding) in respect of any Taxes deducted or withheld by it as described in
the immediately preceding sentence as a result of any changes after the
Effective Date in any applicable law, treaty, governmental rule, regulation,
guideline or order, or in the interpretation thereof, relating to the deducting
or withholding of such Taxes.
(c) If the Borrower pays any additional amount under this Section
2.9 to a Lender and such Lender determines in its sole discretion that it has
actually received or realized in connection therewith any refund or any
reduction of, or credit against, its Tax liabilities in or with respect to the
taxable year in which the additional amount is paid (a "TAX BENEFIT"), such
Lender shall pay to the Borrower an amount that the Lender shall, in its sole
discretion, determine is equal to the net benefit, after tax, which was obtained
by the Lender in such year as a consequence of such refund, reduction or credit,
provided that (i) any Lender may determine, in its sole discretion consistent
with the policies of such Lender, whether to seek a Tax Benefit; (ii) any Taxes
that are imposed on a Lender as a result of a disallowance or reduction
(including through the expiration of any tax credit carryover or carryback of
such Lender that otherwise would not have expired) of any Tax Benefit with
respect to which such Lender has made a payment to the Borrower pursuant to this
Section 2.9(c) shall be treated as a Tax for which the Borrower is obligated to
indemnify such Lender pursuant to this Section 2.9 without any exclusions or
defenses; (iii) nothing in this Section 2.9(c) shall require the Lender to
disclose any confidential information to the Borrower (including, without
limitation, its tax returns); and (iv) no such refund, reduction or credit shall
be made at any time when an Event of Default exists and is continuing.
2.10 SHARING OF PAYMENTS. If any Lender shall obtain any payment
(whether voluntary, involuntary, through the exercise of any right of set-off or
otherwise) on account (x) of the Revolving Loans made by it or its participation
in Letters of Credit in excess of its Revolving Credit Proportionate Share of
payments on account of the Revolving Loans or Letters of Credit obtained by all
the Lenders (other than any Lender that has waived its share in writing), or
interest thereon, such Lender shall forthwith purchase from the other Revolving
Credit Lenders, such participation in the Revolving Loans made by them or in
their participation in Letters of Credit as shall be necessary to cause such
purchasing Lender to share the excess payment ratably with each of them, or (y)
the Term Loans made by it in excess of its Term Loan Proportionate Share of
payments on account of the Term Loans obtained by all the Lenders (other than
any Lender that has waived its share in writing or pursuant to Section 2.5(n)),
or interest thereon, such Lender shall forthwith purchase from the other Term
Loan Lenders such participation in the Term Loans made by them as shall be
necessary to cause such purchasing Lender to share the excess payment ratably
with each of them; PROVIDED, HOWEVER, that if all or any portion of such excess
payment is thereafter recovered from such purchasing Lender, such purchase from
each Lender with Obligations of the respective Tranche shall be rescinded and
each such Lender shall repay to the purchasing Lender the purchase price to the
extent of such recovery together with an amount equal to such Lender's ratable
share (according to the proportion of (i) the amount of such Lender's required
repayment to (ii) the total amount so recovered from the purchasing Lender) of
any interest or other amount paid or payable by the
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purchasing Lender in respect to the total amount so recovered. The Borrower
agrees that any Lender so purchasing a participation from another Lender
pursuant to this Section 2.10 may, to the fullest extent permitted by law,
exercise all of its rights of payment (including the right of set-off) with
respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation.
ARTICLE 3
LETTERS OF CREDIT
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3.1 ISSUANCE OF LETTERS OF CREDIT. Subject to the terms and
conditions of this Credit Agreement and in reliance upon the representations and
warranties of the Borrower set forth herein, upon the request of the Borrower
pursuant to Section 3.4, the Issuing Lender shall issue Letters of Credit
hereunder and for the Borrower's account, as more specifically described below.
It is acknowledged and agreed that each of the letters of credit which were
issued under the Existing Credit Agreement prior to the Initial Borrowing Date
and which remain outstanding on the Initial Borrowing Date and are set forth on
Schedule V (each such letter of credit, an "EXISTING LETTER OF CREDIT" and,
collectively, the "EXISTING LETTERS OF CREDIT") shall, from and after the
Initial Borrowing Date, constitute a Letter of Credit for all purposes of this
Agreement and shall, for purposes of Sections 3.3 and 4.7, be deemed issued on
the Initial Borrowing Date. The stated amount of each Existing Letter of Credit
and the expiry date therefor is set forth on Schedule V. The Issuing Lender
shall not be obligated to issue any Letter of Credit for the account of the
Borrower if at the time of such requested issuance:
(a) the face amount of such requested Letter of Credit (taking the
Dollar Equivalent thereof in the case of any Letter of Credit denominated in an
Alternative Currency) when added to the Letter of Credit Obligations then
outstanding, would (i) cause the Letter of Credit Obligations to exceed
$20,000,000, or (ii) when added to the aggregate amount of Revolving Loans
(including Agent Advances) then outstanding would exceed the lesser of (A) the
Total Revolving Credit Commitments then in effect and (B) the Borrowing Base
then in effect;
(b) any order, judgment or decree of any Governmental Authority or
arbitrator shall purport by its terms to enjoin or restrain the Issuing Lender
from issuing such Letter of Credit or any Requirement of Law applicable to the
Issuing Lender or any request or directive (whether or not having the force of
law) from any Governmental Authority with jurisdiction over the Issuing Lender
shall prohibit, or request the Issuing Lender to refrain from, the issuance of
letters of credit generally or such Letter of Credit in particular or shall
impose upon the Issuing Lender with respect to such Letter of Credit any
restriction or reserve or capital requirement (for which the Issuing Lender is
not otherwise compensated) not in effect as of the Effective Date, or any
unreimbursed loss, cost or expense which was not applicable, in effect or known
to the Issuing Lender as of the Effective Date and which the Issuing Lender
deems in good faith to be material to it; or
(c) a default of any Revolving Credit Lender's obligations to fund
under Section 3.6 exists, or such Revolving Credit Lender is a Defaulting Lender
under Section 2.4(c), or any Revolving Credit Lender has rejected or repudiated
its obligations in respect of Letters of
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Credit, unless the Administrative Agent and the Issuing Lender have entered into
satisfactory arrangements with the Borrower to eliminate the Issuing Lender's
risk with respect to such Revolving Credit Lender, including cash
collateralization of such Revolving Credit Lender's Revolving Credit
Proportionate Share of the Letter of Credit Obligations.
3.2 TERMS OF LETTERS OF CREDIT. The Letters of Credit shall be in
a form customarily issued by the Issuing Lender or in such other form as has
been approved by the Issuing Lender. Each Letter of Credit shall be denominated
in Dollars (or, if agreed by the Administrative Agent and the respective Issuing
Lender in their sole discretion, such Alternate Currency or Alternate Currencies
as may be approved by them for the respective Letter of Credit) and shall be
issued on a sight basis only. At the time of issuance, the amount and the terms
and conditions of each Letter of Credit, and the form of any drawings
thereunder, shall be subject to approval by the Administrative Agent, the
Issuing Lender and the Borrower. In no event may the term of any stand-by Letter
of Credit issued hereunder exceed 12 months (except that such Letters of Credit
may provide for annual renewal) nor the term of any trade Letter of Credit
exceed 180 days, and all Letters of Credit issued hereunder shall expire no
later than the date that is (x) in the case of standby Letters of Credit, ten
Business Days prior to the Maturity Date and (y) in the case of any trade
Letters of Credit, 30 Business Days prior to the Maturity Date.
3.3 REVOLVING CREDIT LENDERS' PARTICIPATION. Immediately upon the
issuance or amendment by the Issuing Lender of any Letter of Credit in
accordance with the procedures set forth in Section 3.1, each Revolving Credit
Lender shall be deemed to have irrevocably and unconditionally purchased and
received from the Issuing Lender, without recourse or warranty, an undivided
interest and participation to the extent of such Revolving Credit Lender's
Revolving Credit Proportionate Share (based upon its Revolving Credit
Commitment) of the liability with respect to such Letter of Credit (including,
without limitation, all obligations of the Borrower with respect thereto, other
than amounts owing to the Issuing Lender consisting of Issuing Lender Fees) and
any security therefor or guaranty pertaining thereto.
3.4 NOTICE OF ISSUANCE. Whenever the Borrower desires the issuance
of a Letter of Credit, the Borrower shall deliver to the Payments Administrator
and the Issuing Lender a written notice no later than 1:00 P.M. New York City
time at least three Business Days (or such shorter period as may be agreed to by
the Issuing Lender) in advance of the proposed date of issuance of a letter of
credit request in the form attached as Exhibit B-2 (a "LETTER OF CREDIT
REQUEST"). The transmittal by the Borrower of each Letter of Credit Request
shall be deemed to be a representation and warranty by the Borrower that the
Letter of Credit may be issued in accordance with and will not violate any of
the requirements of Section 3.1 or 5.2. A Letter of Credit Request may be given
in writing or by facsimile. Promptly after the issuance of or amendment to any
standby Letter of Credit, the Issuing Lender shall notify the Payments
Administrator and the Borrower of such issuance or amendment in writing, and
such notice shall be accompanied by a copy of such Letter of Credit or amendment
thereto. Upon receipt of such notice, the Payments Administrator shall promptly
notify each Revolving Credit Lender, in writing, of such issuance or amendment.
If requested by a Revolving Credit Lender, the Payments Administrator shall
provide such Revolving Credit Lender with copies of such Letter of Credit or
amendment. On the first Business Day of each week, the Issuing Lender shall
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provide the Payments Administrator with a report showing the daily aggregate
outstandings for trade Letters of Credit for the previous week.
3.5 PAYMENT OF AMOUNTS DRAWN UNDER LETTERS OF CREDIT. In the event
of a drawing under a Letter of Credit, the respective Issuing Lender shall
notify the Payments Administrator, who shall notify each Revolving Credit
Lender, of such drawing and, subject to satisfaction or waiver of the conditions
specified in Section 5.2 hereof and the other terms and conditions of Borrowings
contained herein, the Revolving Credit Lenders shall, on the date of such
drawing (or if the Payments Administrator's notice contemplated above is
delivered after 12:00 Noon (New York City time) on the date of such drawing, the
Business Day after such drawing), make Revolving Loans (constituting Base Rate
Loans) in the amount of such drawing (or the Dollar Equivalent thereof in the
case of any drawing under a Letter of Credit denominated in a currency other
than Dollars), the proceeds of which shall be applied directly by the Payments
Administrator to reimburse the Issuing Lender for the amount of such drawing or
payment. Borrowings of Base Rate Loans pursuant to this Section 3.5 shall not be
subject to the minimum amount requirement of Section 2.3(a)(iii). If for any
reason, proceeds of Revolving Loans are not received by the Issuing Lender on
such date in an amount equal to the amount of such drawing (or the Dollar
Equivalent thereof in the case of any drawing under a Letter of Credit
denominated in a currency other than Dollars), the Borrower shall be obligated
to and shall reimburse the Issuing Lender, on the Business Day immediately
following such date, in Dollars in an amount in same day funds equal to the
excess of the amount of such drawing (or the Dollar Equivalent thereof in the
case of any drawing under a Letter of Credit denominated in a currency other
than Dollars) over the amount of such Revolving Loans, if any, which are so
received, plus accrued interest on such amount until paid in full at the rate
set forth in Section 4.2 or 4.4, as applicable; PROVIDED, HOWEVER, that any such
payments shall not prejudice any rights that the Borrower may have against any
Revolving Credit Lender as a result of any default by such Revolving Credit
Lender in funding such Revolving Loans, as provided in the final sentence of
Section 2.4(c).
3.6 PAYMENT BY REVOLVING CREDIT LENDERS. (a) In the event that the
Borrower does not reimburse the Issuing Lender for the amount of any drawing
pursuant to Section 3.5 (in the case of any drawing under a Letter of Credit
denominated in a currency other than Dollars, taking the Dollar Equivalent
thereof on the date of the respective drawing) and the proceeds of Revolving
Loans incurred for such purpose are insufficient for such purpose, the Payments
Administrator shall promptly notify each Revolving Credit Lender of the
unreimbursed amount (expressed in Dollars) and of such Revolving Credit Lender's
respective participation therein. Each Revolving Credit Lender shall make
available to the Issuing Lender in Dollars an amount equal to its respective
participation in same day funds, at the office of such Issuing Lender specified
in such notice, not later than 1:00 P.M. New York City time on the Business Day
after the date notified by the Payments Administrator. In the event that any
Revolving Credit Lender fails to make available to the Issuing Lender the amount
of such Revolving Credit Lender's participation in such Letter of Credit as
provided in this Section 3.6, the Issuing Lender shall be entitled to recover
such amount on demand from such Revolving Credit Lender, together with interest
at the Federal Funds Rate for the first three days and at the interest rate
applicable to Revolving Loans maintained as Base Rate Loans for each day
thereafter.
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(b) The Payments Administrator or the Issuing Lender, as the case
may be, shall distribute to each Lender which has paid all amounts payable by it
under this Section 3.6 with respect to any Letter of Credit, such Lender's
Revolving Credit Proportionate Share of all payments subsequently received by
the Payments Administrator or the Issuing Lender, as the case may be, from the
Borrower in reimbursement of drawings honored under such Letter of Credit when
such payments are received.
3.7 NATURE OF ISSUING LENDER'S DUTIES. In determining whether to
pay under any Letter of Credit, the Issuing Lender shall be responsible only to
determine that the documents and certificates required to be delivered under
that Letter of Credit have been delivered and that they substantially comply on
their face with the requirements of that Letter of Credit. As between the
Borrower, the Issuing Lender and each other Lender, the Borrower assumes all
risks of the acts and omissions of, or misuse of the Letter of Credit issued by
the Issuing Lender by, the respective beneficiaries of such Letter of Credit;
PROVIDED, HOWEVER, that nothing in this sentence shall relieve the Issuing
Lender of liability for its gross negligence or willful misconduct (as
determined by a court of competent jurisdiction in a final and unappealable
decision). In furtherance and not in limitation of the foregoing, neither the
Issuing Lender nor any of the other Lenders shall be responsible (i) for the
form, validity, sufficiency, accuracy, genuineness or legal effects of any
document submitted by any party in connection with the application for and
issuance of or any drawing honored under such Letter of Credit even if it should
in fact prove to be in any or all respects invalid, insufficient, inaccurate,
fraudulent or forged, (ii) for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign such Letter of
Credit, or the rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason, (iii) for
failure of the beneficiary of such Letter of Credit to comply fully with
conditions required in order to draw upon such Letter of Credit, (iv) for
errors, omissions, interruptions or delays in transmission or delivery of any
messages, by mail, cable, telegraph, telex, telecopy, facsimile or otherwise,
whether or not they be in cipher, (v) for errors in interpretation of technical
terms, (vi) for any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any such Letter of Credit, or
of the proceeds thereof, (vii) for the misapplication by the beneficiary of such
Letter of Credit of the proceeds of any drawing honored under such Letter of
Credit, or (viii) for any consequences arising from actions or omissions taken
or omitted in good faith or from causes beyond the control of the Issuing Lender
or the other Lenders; PROVIDED, HOWEVER, that nothing in this sentence shall
relieve the Issuing Lender of liability for its own gross negligence or willful
misconduct (as determined by a court of competent jurisdiction in a final and
unappealable decision).
3.8 OBLIGATIONS ABSOLUTE. The obligations of the Borrower to
reimburse the Issuing Lender (in Dollars) for drawings honored under a Letter of
Credit issued by it and the obligations of the Revolving Credit Lenders under
Section 3.6 shall be unconditional and irrevocable and shall be performed
strictly in accordance with the terms of this Credit Agreement under all
circumstances including, without limitation, the following circumstances:
(a) any lack of validity or enforceability of any Letter of
Credit;
(b) the existence of any claim, set-off, defense or other right
which the Borrower or any Affiliate of the Borrower may have at any time against
a beneficiary or any
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transferee of any Letter of Credit (or any Persons or entities for whom any such
beneficiary or transferee may be acting), the Issuing Lender, any Lender or any
other Person, whether in connection with this Credit Agreement, the transactions
contemplated herein or any unrelated transaction (other than the defense that
the amount owed has already been paid in accordance with the terms of this
Credit Agreement); PROVIDED, HOWEVER, that nothing contained herein shall
preclude the Borrower from asserting any such claim, defense or counterclaim in
a separate judicial proceeding or by compulsory counterclaim;
(c) any draft, demand, certificate or any other documents
presented under any Letter of Credit proving to be forged, fraudulent, invalid
or insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(d) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit Documents;
(e) payment by the Issuing Lender under any Letter of Credit
against presentation of a demand, draft or certificate or other document which
does not comply with the terms of such Letter of Credit;
(f) failure of any drawing under a Letter of Credit or any
non-application or misapplication by the beneficiary of the proceeds of any
drawing; or
(g) the fact that a Default or Event of Default shall have
occurred and be continuing;
PROVIDED, HOWEVER, that the Borrower shall have no obligation to reimburse the
Issuing Lender and the Lenders shall have no obligation under Section 3.6 in the
event of the Issuing Lender's willful misconduct or gross negligence (as
determined by a court of competent jurisdiction in a final and unappealable
decision) in determining whether documents presented under the Letter of Credit
comply with the terms of such Letter of Credit or with respect to any other
express obligation the Issuing Lender may have under this Credit Agreement in
making any payment pursuant to any Letter of Credit.
ARTICLE 4
INTEREST, FEES AND EXPENSES
---------------------------
4.1 INTEREST ON EURODOLLAR RATE LOANS. Subject to the provisions
of Section 4.4 hereof, interest on Eurodollar Rate Loans shall be payable in
arrears (i) on the last day of each Interest Period with respect to such
Eurodollar Rate Loans (and, in the case of any Interest Period in excess of
three months, on each date which occurs at three month intervals after the first
day of the respective Interest Period), (ii) at the date of any Conversion
thereof (or portion thereof) to a Base Rate Loan, (iii) upon any prepayment,
except pursuant to Section 2.6(d), (on the amount prepaid) and (iv) at maturity
(whether by acceleration or otherwise) and, after such maturity, on demand, in
each case at an interest rate PER ANNUM equal during each Interest Period for
such Eurodollar Rate Loan to the Adjusted Eurodollar Rate in effect for such
Interest Period plus the relevant Applicable Margin. The Payments Administrator
upon determining the
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Adjusted Eurodollar Rate for any Interest Period shall promptly notify the
Borrower and the Lenders thereof. Each determination by the Payments
Administrator of an interest rate hereunder shall be conclusive and binding for
all purposes, absent manifest error.
4.2 INTEREST ON BASE RATE LOANS. Subject to the provisions of
Section 4.4 hereof, interest on Base Rate Loans shall be payable quarterly in
arrears (i) on the last Business Day of each calendar quarter, (ii) upon any
prepayment, except pursuant to Section 2.6(d), (on the amount prepaid) and (iii)
at maturity (whether by acceleration or otherwise) and, after such maturity, on
demand, in each case at an interest rate PER ANNUM equal to the Base Rate plus
the relevant Applicable Margin. Each determination by the Payments Administrator
of an interest rate hereunder shall be conclusive and binding for all purposes,
absent manifest error.
4.3 NOTICE OF CONTINUATION AND NOTICE OF CONVERSION. (a) With
respect to any Borrowing consisting of Eurodollar Rate Loans, the Borrower may,
subject to the provisions of Section 4.3(c) and the condition that no Default or
Event of Default then exists, elect to maintain such Borrowing or any portion
thereof equal to at least $1,000,000 as Eurodollar Rate Loans by selecting a new
Interest Period for such Borrowing (or portion thereof), which new Interest
Period shall commence on the last day of the immediately preceding Interest
Period. Each selection of a new Interest Period (a "CONTINUATION") shall be made
by notice given by the Borrower to the Payments Administrator not later than
12:00 Noon New York City time on the third Business Day prior to the date of any
such Continuation. Such notice (a "NOTICE OF CONTINUATION") shall be by
telephone, telecopy, telex, facsimile or cable, confirmed immediately in writing
if by telephone, in substantially the form of Exhibit B-3, which shall be
completed in such manner as is necessary to comply with all limitations on the
Loans outstanding hereunder. If the Borrower shall fail to, or does not have the
right to, select a new Interest Period for any Borrowing consisting of
Eurodollar Rate Loans in accordance with this Section 4.3(a), such Loans will
automatically, on the last day of the then existing Interest Period therefor,
Convert into Base Rate Loans.
(b) The Borrower may on any Business Day, upon notice (each such
notice, a "NOTICE OF CONVERSION") given to the Payments Administrator, and
subject to the provisions of Section 4.3(c) and the condition that no Default or
Event of Default then exists, Convert the entire amount of or a portion of any
Loans of one Type into a Borrowing of such Loans of the other Type; PROVIDED,
however, (i) that any Conversion of any Eurodollar Rate Loans into Base Rate
Loans shall only be made on the last day of an Interest Period for such
Eurodollar Rate Loans and (ii) prior to the Syndication Date, Base Rate Loans
Converted into Eurodollar Loans shall be subject to the provisions of Section
2.3(a)(v). Each such Notice of Conversion shall be given not later than 12:00
Noon New York City time on the Business Day prior to the date of any proposed
Conversion into Base Rate Loans and on the third Business Day prior to the date
of any proposed Conversion into Eurodollar Rate Loans (it being understood and
agreed that any Notice of Conversion with respect to a proposed Conversion into
Eurodollar Loans on or after the Effective Date may be given by the Borrower to
the Payments Administrator prior to the Effective Date (subject to the preceding
provisions of this Section 4.3(b)). Subject to the restrictions specified above,
each Notice of Conversion shall be by telephone, telecopy, telex, facsimile or
cable, confirmed immediately in writing if by telephone, in substantially the
form of Exhibit B-4. Each Conversion shall be in an aggregate amount for the
Revolving Loans of all Lenders of not less than $250,000.
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(c) Notwithstanding anything contained in Section 2.3 or Sections
4.3(a) and (b) above to the contrary:
(i) if, on or prior to the first day of any Interest Period, the
Payments Administrator is unable to determine the Adjusted Eurodollar
Rate for Eurodollar Rate Loans comprising any requested Borrowing,
Continuation or Conversion, the right of the Borrower to select or
maintain Eurodollar Rate Loans for such Borrowing or any subsequent
Borrowing shall be suspended until the Payments Administrator shall
notify the Borrower and the Lenders that the circumstances causing such
suspension no longer exist, and each Loan comprising such Borrowing
shall be made as, or Converted into, a Base Rate Loan; PROVIDED that,
promptly after the Payments Administrator reasonably determines that
the circumstances giving rise to such suspension no longer exist, the
Payments Administrator shall notify the Borrower and the Lenders, and
the obligation of the Lenders to make, Convert and Continue Eurodollar
Rate Loans shall be reinstated;
(ii) if the Required Lenders shall, at least one Business Day
before the date of any requested Borrowing, Continuation or Conversion,
notify the Payments Administrator that the Adjusted Eurodollar Rate for
Loans comprising such Borrowing will not adequately reflect the cost to
such Lenders of making or funding their respective Loans for such
Borrowing, the right of the Borrower to select Eurodollar Rate Loans
for such Borrowing shall be suspended until the Payments Administrator
shall notify the Borrower and the Lenders that the circumstances
causing such suspension no longer exist, and each Loan comprising such
Borrowing shall be made as, or Converted into, a Base Rate Loan;
PROVIDED that, promptly after the Payments Administrator and the
Required Lenders reasonably determine that the circumstances giving
rise to such suspension no longer exist, the Payments Administrator
shall notify the Borrower and the Lenders, and the obligation of the
Lenders to make, Convert and Continue Eurodollar Rate Loans shall be
reinstated; and
(iii) there shall not be at any one time more than twelve Interest
Periods in effect with respect to Eurodollar Rate Loans.
(d) Each Notice of Continuation and Notice of Conversion shall be
irrevocable by and binding on the Borrower. In the case of any Borrowing,
Continuation or Conversion that the related Notice of Borrowing, Notice of
Continuation or Notice of Conversion specifies is to be comprised of Eurodollar
Rate Loans, the Borrower shall indemnify each Lender against any loss, cost or
expense incurred by such Lender as a result of any failure to fulfill, on or
before the date for such Borrowing, Continuation or Conversion specified in such
Notice of Borrowing, Notice of Continuation or Notice of Conversion, the
applicable conditions set forth in Article 5, including, without limitation, any
loss (excluding loss of anticipated profits), cost or expense incurred by reason
of the liquidation or re-employment of deposits or other funds acquired by such
Lender to fund the Eurodollar Rate Loan to be made by such Lender as part of
such Borrowing, Continuation or Conversion.
4.4 INTEREST AFTER DEFAULT. Interest on any amount of matured
principal of the Loans, and interest on the amount of principal of the Loans
outstanding as of the date a Default or an Event of Default occurs, and at all
times thereafter until the earlier of the date upon which
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(i) all Obligations have been paid and satisfied in full or (ii) such Default or
Event of Default shall have been cured or waived, shall be payable on demand at
a rate equal to 2% in excess of the rate then borne by such Loans, or, if
higher, the Base Rate in effect from time to time plus the sum of (x) the
Applicable Margin for Base Rate Loans then in effect and (y) 2%.
4.5 REIMBURSEMENT OF EXPENSES. (a) From and after the Effective
Date, the Borrower shall promptly reimburse the Administrative Agent for all
Expenses of the Administrative Agent as the same are incurred by the
Administrative Agent and upon receipt of invoices therefor and, if requested by
the Borrower, such reasonable backup materials and information (other than
backup materials and information relating to the calculation of breakage costs)
as the Borrower shall reasonably request.
(b) If any payment of principal of, or any Conversion of, any
Eurodollar Rate Loan is made other than on the last day of an Interest Period
applicable thereto for any reason or the day the Borrower has notified the
Payments Administrator such payment or Conversions shall occur, the Borrower
shall, upon demand by any Lender (with a copy of such demand to the Payments
Administrator), pay to the Payments Administrator for the account of such Lender
any amounts required to compensate such Lender for any additional losses, costs
or expenses which it may reasonably incur as a result of such payment,
including, without limitation, any loss (excluding loss of anticipated profits),
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by any Lender to fund or maintain such
Eurodollar Rate Loan.
4.6 UNUSED LINE FEE. The Borrower shall pay to the Payments
Administrator for the benefit of each of the Lenders (other than a Defaulting
Lender for so long as such Lender is a Defaulting Lender) a non-refundable fee
(the "UNUSED LINE FEE") at a PER ANNUM rate equal to the Applicable Unused Line
Fee Percentage of the daily unused portion of such Lender's Revolving Credit
Commitment, which Unused Line Fee shall (i) accrue from the Effective Date until
the Maturity Date or any earlier date on which the Total Revolving Credit
Commitments are terminated and (ii) be due and payable quarterly in arrears on
the last Business Day of March, June, September and December, and on the
Maturity Date or any earlier date on which the Total Revolving Credit
Commitments are terminated.
4.7 LETTER OF CREDIT FEES. (a) The Payments Administrator shall be
entitled to charge to the account of the Borrower (i) for the ratable benefit of
the Revolving Credit Lenders in accordance with their respective Revolving
Credit Proportionate Shares, a fee (the "LETTER OF CREDIT FEE"), in an amount
equal to the Applicable Margin then in effect for Revolving Loans maintained as
Eurodollar Rate Loans PER ANNUM of the daily amount of Undrawn Letter of Credit
Outstandings during the immediately preceding quarter, due and payable quarterly
in arrears on the last Business Day of March, June, September and December, and
on the Maturity Date or any earlier date on or after the termination of the
Total Revolving Credit Commitments when no Letters of Credit are outstanding and
(ii) as and when incurred by the Payments Administrator or any Lender, any
administrative charges, fees, costs and expenses charged to the Payments
Administrator or any Lender for the Borrower's account by the Issuing Lender
(other than any fees charged to the Payments Administrator or any Lender which
would be duplicative of the Letter of Credit Fee paid to the Payments
Administrator for the benefit of the Lenders) (the "ISSUING LENDER FEES") in
connection with the issuance of any Letters of Credit by the Issuing
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Lender. Each determination by the Payments Administrator of Letter of Credit
Fees hereunder shall be conclusive and binding for all purposes, absent manifest
error. In addition, the Borrower agrees to pay to the Issuing Lender, for its
own account, a facing fee in respect of each Letter of Credit issued by it (the
"FACING FEE") for the period from and including the date of issuance of such
Letter of Credit to and including the date of termination or expiration of such
Letter of Credit, computed at a rate per annum equal to 0.15% on the daily
amount of Undrawn Letter of Credit Outstandings, PROVIDED that in any event the
minimum amount of Facing Fees payable in any twelve-month period for each Letter
of Credit shall be not less than $500, it being agreed that, on the day of
issuance of any Letter of Credit and on each anniversary thereof prior to the
termination or expiration of such Letter of Credit, if $500 will exceed the
amount of Facing Fees that will accrue with respect to such Letter of Credit for
the immediately succeeding twelve-month period, the full $500 shall be payable
on the date of issuance of such Letter of Credit and on each such anniversary
thereof. Except as otherwise provided in the proviso to the immediately
preceding sentence, accrued Facing Fees shall be due and payable quarterly in
arrears on the last Business Day of March, June, September and December, and on
the Maturity Date or any earlier date on or after the termination of the Total
Revolving Credit Commitments when no Letters of Credit are outstanding.
(b) Letter of Credit Fees payable in respect of Undrawn Letter of
Credit Outstandings as of the date a Default or an Event of Default occurs, and
at all times thereafter until the earlier of the date upon which (i) all
Obligations have been paid and satisfied in full or (ii) such Default or Event
of Default shall have been cured or waived, shall be payable on demand at a rate
equal to the rate at which the Letter of Credit Fees are charged pursuant to
Section 4.7(a) above, plus 2% PER ANNUM.
4.8 INCREMENTAL COMMITMENTS. The Borrower may agree to pay to any
Incremental Lender such up-front fees, and amounts as contemplated by the last
paragraph of Section 2.1, as are specified in the Incremental Commitment
Agreement pursuant to which such Incremental Commitment has been provided, with
such amounts to be payable at the times set forth in such Incremental Commitment
Agreement. It is understood that the interest and regularly accruing fees with
respect to the extensions of credit provided pursuant to any Incremental
Commitment, as well as the regularly accruing fees with respect to any Revolving
Credit Commitment provided pursuant to any Incremental Commitment Agreements,
shall be as provided in this Credit Agreement.
4.9 OTHER FEES AND EXPENSES. The Borrower agrees to pay (without
duplication) fees to the Administrative Agent (or its affiliates as specified
therein) in the amounts and at the times set forth in the Fee Letter.
4.10 AUTHORIZATION TO CHARGE ACCOUNT. The Borrower hereby
authorizes the Payments Administrator, subject to prior notice to the Borrower,
to charge the Borrower's Revolving Loan account with the amount of all Fees,
Expenses and other payments to be paid hereunder, under the Fee Letter and under
the other Credit Documents as and when such payments become due, provided that
any such Expenses attributable to services provided by third party accountants,
consultants, advisors and other professionals retained by the Administrative
Agent or any of its affiliates shall have been invoiced to the Borrower or the
Administrative Agent or its respective affiliate, with a copy of said invoice
provided to the Borrower. The
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Borrower confirms that any charges which the Payments Administrator may so make
to the Borrower's Revolving Loan account as herein provided will be made as an
accommodation to the Borrower and solely at the Payments Administrator's
discretion.
4.11 INDEMNIFICATION IN CERTAIN EVENTS. (a) If after the Effective
Date, either (i) any change in or in the interpretation of any law or regulation
is introduced, including, without limitation, with respect to reserve
requirements, applicable to any Agent, the Payments Administrator, the Issuing
Lender or any of the Lenders (or, in the case of a Lender which is not a banking
institution, any Affiliate of such Lender funding such Lender (any such
Affiliate, a "FUNDING AFFILIATE")), or (ii) any Agent, the Payments
Administrator, the Issuing Lender, or any of the Lenders (or, in the case of a
Lender which is not a banking institution, any Funding Affiliate) complies with
any future guideline or request from any central bank or other Governmental
Authority or (iii) any Agent, the Payments Administrator, the Issuing Lender, or
any of the Lenders (or, in the case of a Lender which is not a banking
institution, any Funding Affiliate) reasonably determines that the adoption of
any applicable law, rule or regulation regarding capital 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 has or would have the effect described
below, or any Agent, the Payments Administrator, the Issuing Lender, or any of
the Lenders (or, in the case of a Lender which is not a banking institution, any
Funding Affiliate) complies with any future request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, and in the case of any event set forth in
this clause (iii), such adoption, change or compliance has or would have the
direct or indirect effect of reducing the rate of return on any of such Person's
(or any Funding Affiliate's) capital as a consequence of its obligations
hereunder to a level below that which such Person could have achieved but for
such adoption, change or compliance (taking into consideration such Person's (or
any Funding Affiliate's) policies with respect to capital adequacy) by an amount
deemed by such Person to be material, and any of the foregoing events described
in clauses (i), (ii) or (iii) increases the cost or reduces the rate of return
to any Agent, the Payments Administrator, the Issuing Lender, or any of the
Lenders of (A) (i) with respect to an event described in clauses (i) and (ii),
making or maintaining its Eurodollar Rate Loans, and (ii) with respect to an
event described in clause (iii), funding or maintaining its Commitment or (B)
issuing, making or maintaining any Letter of Credit or of purchasing or
maintaining any participation therein, or reduces the amount receivable in
respect thereof by any Agent, the Payments Administrator, the Issuing Lender or
any Lender, then the Borrower shall within 15 days after demand by the
Administrative Agent, pay to the Payments Administrator, for the account of each
applicable Lender or the Issuing Lender, as the case may be, additional amounts
sufficient to indemnify the Administrative Agent, the Payments Administrator,
the Lenders or the Issuing Lender against such increase in cost or reduction in
amount receivable allocable to such Agent's, the Payments Administrator's, such
Lenders' or the Issuing Lender's, as the case may be, funding or maintaining its
Commitment or issuing, making or maintaining any Letter of Credit or purchasing
or maintaining any participation therein. A certificate as to the amount of such
increased cost and setting forth in reasonable detail the calculation thereof
shall be submitted to the Borrower by the applicable Agent, the Payments
Administrator, or the applicable Lender or the Issuing Lender, as the case may
be, and shall be conclusive absent manifest error.
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(b) Each Lender, the Issuing Lender or each Agent will notify the
Borrower and the Payments Administrator of any event occurring after the
Effective Date which will entitle such Lender, the Issuing Lender or such Agent
to payment pursuant to Section 4.10(a) as promptly as practicable after it
obtains knowledge thereof, specifying the event giving rise to such claim and
setting out in reasonable detail an estimate of the basis and computation of
such claim. Upon receipt of such notice, the Borrower shall compensate such
Lender, the Issuing Lender or Agent in accordance with Section 4.11(a) from the
date such costs are incurred (including, without limitation, where such costs
are retroactively applied); PROVIDED, HOWEVER, that the Borrower shall not be
required to compensate a Lender, the Issuing Lender or Agent for costs incurred
earlier than 90 days prior to the date of the notice required to be delivered to
the Borrower pursuant to this Section 4.11(b).
4.12 CALCULATIONS. All calculations of (i) interest hereunder and
(ii) Fees, including, without limitation, Unused Line Fees and Letter of Credit
Fees shall be made by the Payments Administrator, on the basis of a year of 360
days, or, if such computation would cause the interest and Fees chargeable
hereunder to exceed the Highest Lawful Rate, 365/366 days, in each case for the
actual number of days elapsed (including the first day but excluding the last
day) occurring in the period for which such interest or Fees are payable. Each
determination by the Payments Administrator of an interest rate or payment
hereunder shall be conclusive and binding for all purposes, absent manifest
error.
4.13 CHANGE OF APPLICABLE LENDING OFFICE. Each Lender agrees that
on the occurrence of any event giving rise to the operation of Sections 2.9,
4.3(c) or 4.11 with respect to such Lender, it will, if requested by the
Borrower, use reasonable efforts (subject to overall policy considerations of
such Lender) to designate another lending office for any Loans or Letters of
Credit affected by such event, PROVIDED that such designation is made on such
terms that such Lender and its lending office suffer no economic, legal or
regulatory disadvantage, with the object of avoiding the consequence of the
event giving rise to the operation of such Sections. Nothing in this Section
4.13 shall affect or postpone any of the obligations of the Borrower or the
right of any Lender provided in Sections 2.9, 4.3 or 4.11.
ARTICLE 5
CONDITIONS PRECEDENT
--------------------
5.1 CONDITIONS TO INITIAL LOANS AND LETTERS OF CREDIT. The
obligation of each Lender to make Loans hereunder and the obligation of the
Issuing Lender to issue Letters of Credit, in each case on the Initial Borrowing
Date, is subject to the satisfaction of, or waiver of, immediately prior to or
concurrently with the making of such Loans or the issuance of such Letters of
Credit on the Initial Borrowing Date, the following conditions precedent:
(a) EXECUTION OF AGREEMENT; NOTES. On or prior to the Initial
Borrowing Date, the Effective Date shall have occurred and there shall have been
delivered to the Payments Administrator for the account of each Lender that has
requested same the appropriate Revolving Note and/or Term Note in the amount,
maturity and as otherwise provided herein.
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(b) OFFICER'S CERTIFICATE. On the Initial Borrowing Date, the
Administrative Agent shall have received a certificate from Holdings dated such
date signed by an appropriate officer of Holdings stating that all of the
applicable conditions set forth in Section 5.1(d)(C), (h), (i), (j), (k), (l)
and (w) and Section 5.2 exist as of such date, provided the certificate shall
not be required to certify as to the acceptability of any items to the
Administrative Agent and/or the Required Lenders or as to whether the
Administrative Agent and/or the Required Lenders are satisfied with any of the
matters described in said Sections.
(c) OPINIONS OF COUNSEL. On the Initial Borrowing Date, the
Administrative Agent shall have received opinions, addressed to each Agent and
each of the Lenders and dated the Initial Borrowing Date, (i) from ▇▇▇▇, Weiss,
Rifkind, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, special counsel to Holdings and the Borrower, which
opinion shall cover the matters contained in Exhibit E-1 and such other matters
incident to the transactions contemplated herein as the Administrative Agent may
reasonably request, (ii) from Davies ▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, Canadian counsel
to WSC, which opinion shall cover the matters contained in Exhibit E-2 and such
other matters incident to the transactions contemplated herein as the
Administrative Agent may reasonably request and (iii) from White & Case LLP,
special counsel to BTCo, which opinion shall cover the matters contained in
Exhibit E-3 and (iv) from local counsel reasonably satisfactory to the
Administrative Agent, opinions each of which shall be in form and substance
reasonably satisfactory to the Administrative Agent and shall cover the
perfection of the security interest granted pursuant to the Security Agreements
and such other matters incident to the transaction contemplated herein as the
Administrative Agent may reasonably request.
(d) SECURITY AGREEMENTS. (i) On the Initial Borrowing Date, each
U.S. Credit Party shall have duly authorized, executed and delivered the U.S.
Security Agreement in the form of Exhibit F-1 (as amended, modified or
supplemented from time to time in accordance with the terms hereof and thereof,
the "U.S. SECURITY AGREEMENT") together with:
(A) proper Financing Statements (Form UCC-1 or the equivalent)
fully executed for filing under the UCC or other appropriate filing
offices of each jurisdiction as may be necessary or, in the reasonable
opinion of the Collateral Agent, desirable, to perfect the security
interests purported to be created by the U.S. Security Agreement;
(B) certified copies of Requests for Information or Copies (Form
UCC-11), or equivalent reports as of a recent date, listing all
effective financing statements that name Holdings, the Borrower or any
of their respective Subsidiaries as debtor and that are filed in the
jurisdictions referred to in clause (A) above and in such other
jurisdictions in which Collateral is located on the Initial Borrowing
Date or which may result in the existence of perfected security
interests against Holdings, the Borrower or any of their Subsidiaries,
together with copies of such other financing statements that name
Holdings, the Borrower or any of their respective Subsidiaries as
debtor (none of which shall cover any of the Collateral except (x) to
the extent evidencing Permitted Liens or (y) those in respect of which
the Collateral Agent shall have received termination statements (Form
UCC-3) or such other termination statements as shall be required by
local law fully executed for filing);
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(C) subject to Section 11.19, evidence that, with respect to all
Certificated Units of the Borrower and its Subsidiaries on the Initial
Borrowing Date, a notation of the security interest of the Collateral
Agent has been made on the certificate of title with respect thereto
(or that the Borrower has deposited (or will substantially currently
with the Initial Borrowing Date deposit) an application for such
notation with the applicable Governmental Authority, together with any
necessary fee in connection therewith) which notation shall, under
applicable state law, perfect the Collateral Agent's security interest
therein (except to the extent the UCC is controlling, in which case the
Financing Statements filed pursuant to preceding clause (A) shall
perfect such security interests);
(D) subject to Section 11.19, evidence of the completion of all
other recordings and filings of, or with respect to, the U.S. Security
Agreement as may be necessary or, in the opinion of the Collateral
Agent, desirable, to perfect the security interests intended to be
created by the U.S. Security Agreement; and
(E) subject to Section 11.19, evidence that all other actions
necessary or, in the reasonable opinion of the Collateral Agent,
desirable to perfect and protect the security interests purported to be
created by the U.S. Security Agreement have been taken, and the U.S.
Security Agreement shall be in full force and effect.
(ii) On the Initial Borrowing Date, WSC shall have duly authorized,
executed and delivered a Canadian Security Agreement together with:
(A) evidence of registration of such Canadian Security Agreement
in such jurisdictions as may be necessary or, in the opinion of the
Collateral Agent, desirable to perfect and protect the security
interest intended to be created by such Canadian Security Agreement;
and
(B) all discharges, subordination agreements, waivers and
confirmations as may be necessary or, in the opinion of the Collateral
Agent, desirable to ensure that all obligations purported to be secured
by such Canadian Security Agreement are secured by first priority liens
on the property and assets of WSC with such exceptions as are permitted
herein.
(e) COLLATERAL ACCESS AGREEMENTS. To the extent available on the
Initial Borrowing Date, the Administrative Agent shall have received Collateral
Access Agreements substantially in the form of Exhibit G (as modified, amended,
or supplemented from time to time in accordance with the terms hereof and
thereof, the "COLLATERAL ACCESS AGREEMENTS") with respect to Rental Equipment
locations as may be requested by the Administrative Agent, which Collateral
Access Agreements shall be in full force and effect; PROVIDED that,
notwithstanding the foregoing, the Borrower, in obtaining the Collateral Access
Agreements required under this Section 5.1(e), shall not be obligated to make
significant payments to landlords or alter the respective lease terms with
respect to any Rental Equipment locations in any way which is materially adverse
to the Borrower.
(f) COLLECTION BANK AGREEMENTS; CONCENTRATION ACCOUNT AGREEMENT.
On the Initial Borrowing Date, the Administrative Agent shall have received
fully executed copies of the
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Collection Bank Agreement and the Concentration Account Agreement, each of which
shall be in full force and effect.
(g) BORROWING BASE CERTIFICATE. On the Initial Borrowing Date, the
Borrower shall have delivered to the Administrative Agent a Borrowing Base
Certificate meeting the requirements of Section 7.1(e) and which Borrowing Base
Certificate shall indicate (in a manner satisfactory to the Administrative
Agent) that on such date and after giving effect to the consummation of the
Refinancing and all Credit Events on such date the Borrower shall be able to
incur additional Revolving Outstandings of $100,000,000 or more in compliance
with the restrictions of Section 2.2(a).
(h) INDEBTEDNESS. On the Initial Borrowing Date, Holdings, the
Borrower and their respective Subsidiaries shall have no outstanding
Indebtedness except (i) pursuant to this Credit Agreement, (ii) the Senior
Unsecured Notes, and (iii) Existing Indebtedness, if any, as shall be permitted
to remain outstanding by the Administrative Agent and which is listed on
Schedule III hereto. With respect to each issue of Indebtedness which is to
remain outstanding as described in clauses (i) through (iii) of the immediately
preceding sentence there shall exist no default or event of default, change of
control or similar event which would require any offers to repurchase same, and
no uncured breach thereof.
(i) APPROVALS. All necessary material governmental (domestic and
foreign) and third party approvals and/or consents in connection with the
transactions contemplated hereby shall have been obtained and remain in full
force and effect. There shall not have been any statute, rule, regulation,
injunction or order applicable to the transaction as contemplated hereby, or the
financing thereof, promulgated, enacted, entered or enforced by any state or
federal government or governmental or regulatory authority or agency or by any
federal or state court or tribunal, nor shall there be pending any action or
proceeding by or before any such authority, court or tribunal, involving a
substantial likelihood of an order, that would prohibit, restrict, delay or
otherwise materially adversely affect the transactions contemplated hereby.
(j) MATERIAL ADVERSE CHANGE, ETC. Since December 31, 2001, nothing
shall have occurred (and neither the Administrative Agent nor the Lenders shall
have become aware of any facts, conditions or other information not previously
known to them) which has had or could reasonably be expected to have a Material
Adverse Effect.
(k) LITIGATION. On the Initial Borrowing Date, there shall be no
actions, suits, investigations or proceedings pending or threatened (a) with
respect to this Credit Agreement, any other Credit Document or any document
executed in connection therewith, or (b) which the Administrative Agent shall
determine has had or could reasonably be expected to have a Material Adverse
Effect.
(l) CORPORATE PROCEEDINGS. (i) On the Initial Borrowing Date, the
Administrative Agent shall have received certificates from each Credit Party
dated the Effective Date and in the form of Exhibit H with appropriate
insertions, together with copies of the Governing Documents of such Credit Party
and the resolutions of such Credit Party referred to in such certificate, and
each of the foregoing shall be in form and substance reasonably acceptable to
the Administrative Agent.
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(ii) On the Initial Borrowing Date, all corporate and legal
proceedings and all instruments and agreements in connection with the
transactions contemplated by this Credit Agreement shall be reasonably
satisfactory in form and substance to the Administrative Agent, and the
Administrative Agent shall have received all information and copies of all
certificates, documents and papers, including good standing certificates and any
other records of corporate proceedings and governmental approvals, if any, which
the Administrative Agent reasonably may have requested in connection therewith,
such documents and papers, where appropriate, to be certified by proper
corporate or governmental authorities.
(m) PLANS; COLLECTIVE BARGAINING AGREEMENTS; EXISTING INDEBTEDNESS
AGREEMENTS; SHAREHOLDERS' AGREEMENTS; MANAGEMENT AGREEMENTS; EMPLOYMENT
AGREEMENTS; TAX SHARING AGREEMENTS; MATERIAL CONTRACTS. On or prior to the
Initial Borrowing Date, there shall have been delivered or made available to the
Administrative Agent true and correct copies, of the following documents, in
each case as same will be in effect on the Initial Borrowing Date:
(i) all Plans (and for each Plan that is required to file an
annual report on Internal Revenue Service Form 5500-series, a copy of
the most recent such report (including, to the extent required, the
related financial and actuarial statements and opinions and other
supporting statements, certifications, schedules and information), and
for each Plan that is a "single-employer plan", as defined in Section
4001(a)(15) of ERISA, the most recently prepared actuarial valuation
therefor) and any other "employee benefit plans", as defined in Section
3(3) of ERISA, and any other material agreements, plans or
arrangements, with or for the benefit of current or former employees of
Holdings, the Borrower or any of their respective Subsidiaries or any
ERISA Affiliate (provided that the foregoing shall apply in the case of
any "multiemployer plan", as defined in 4001(a)(3) of ERISA, only to
the extent that any document described therein is in the possession of
Holdings, the Borrower or any of their respective Subsidiaries or any
ERISA Affiliate or reasonably available thereto from the sponsor or
trustee of any such plan), and any recent actuarial analysis prepared
in connection with any of the foregoing;
(ii) all collective bargaining agreements or any other similar
agreement or arrangements covering the employees of Holdings, the
Borrower or any of their respective Subsidiaries (collectively, the
"COLLECTIVE BARGAINING AGREEMENTS");
(iii) all agreements evidencing or relating to any Existing
Indebtedness in an aggregate amount in excess of $1,000,000
(collectively, the "EXISTING INDEBTEDNESS AGREEMENTS");
(iv) all agreements entered into by Holdings, the Borrower or any
of their respective Subsidiaries (x) governing the terms and relative
rights of such entity's capital stock or (y) with any shareholders
relating to any such entity with respect to such entity's capital stock
(collectively, the "SHAREHOLDERS' AGREEMENTS");
(v) any material agreements (or the forms thereof) with members
of, or with respect to, the management of Holdings, the Borrower or any
of their respective Subsidiaries (collectively, the "MANAGEMENT
AGREEMENTS");
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(vi) any employment agreements (or the forms thereof together with
a list of employees who are parties to such agreements) entered into by
Holdings, the Borrower or any of their respective Subsidiaries
(collectively, the "EMPLOYMENT AGREEMENTS");
(vii) any tax sharing, tax allocation and other similar agreement
entered into by Holdings, the Borrower or any of their respective
Subsidiaries (collectively, the "TAX SHARING AGREEMENTS");
(viii) any lease agreement between the Borrower or one or more of its
Subsidiaries, on the one hand, and the Unit Subsidiary, on the other
hand, pursuant to which Non-Qualified Units from time to time held by
the Unit Subsidiary are leased to the Borrower and its Subsidiaries
(collectively, the "MASTER LEASE AGREEMENTS"); and
(ix) any other Material Contracts;
all of which documents relating to the Plans, Collective Bargaining
Agreements, Existing Indebtedness Agreements, Shareholders' Agreements,
Management Agreements, Employment Agreements, Tax Sharing Agreements,
Master Lease Agreements and Material Contracts shall be in the form and
substance reasonably satisfactory to the Administrative Agent and
shall, except as contemplated by the Credit Documents, be in full force
and effect on the Initial Borrowing Date.
(n) SOLVENCY CERTIFICATE. On or prior to the Initial Borrowing
Date, the Lenders shall have received a solvency certificate from the chief
financial officer of Holdings in the form of Exhibit I.
(o) FINANCIAL STATEMENTS; PROJECTIONS; ETC. On or prior to the
Initial Borrowing Date, the Lenders shall have received (i) true and correct
copies of the historical Financial Statements referred to in Section 6.10(b),
together with a certificate from the chief financial officer of the Borrower
certifying that the related audited Financial Statements shall not materially
differ from such historical Financial Statements, which historical Financial
Statements and certificate shall be in form and substance reasonably
satisfactory to the Administrative Agent, (ii) a draft of the audited Financial
Statements referred to in preceding clause and (iii) detailed annual five-year
financial projections (setting forth yearly projections for each fiscal year
during such five-year period) (including details as to rental rates, utilization
rates, fleet capital expenditures and cost per unit assumptions and
corresponding balance sheets, statements of operations and cash flow and changes
in shareholders' equity) of Holdings and its Subsidiaries in form and substance
reasonably satisfactory to the Administrative Agent (together with those
projections heretofore provided to the Lenders, the "PROJECTIONS").
(p) INSURANCE POLICIES. On or prior to the Initial Borrowing Date,
the Administrative Agent shall have received (i) evidence of insurance coverage
(including, without limitation, certificates of insurance) for the business and
properties of Holdings, the Borrower and their respective Subsidiaries showing
compliance with the requirements of Section 7.10 and (ii) endorsements, (x)
naming the Collateral
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Agent as loss payee with respect to all casualty coverages and containing other
customary loss payable provisions and (y) naming the Collateral Agent as
additional insured for all general liability coverages, all in form and
substance reasonably satisfactory to the Collateral Agent.
(q) PAYMENT OF FEES. On the Initial Borrowing Date, all costs,
fees and expenses, and all other compensation contemplated by this Credit
Agreement or the Fee Letter due to the Administrative Agent or the Lenders
(including, without limitation, reasonable legal fees and expenses) shall have
been paid to the extent invoiced and due.
(r) COLLATERAL EXAMINATION. On or prior to the Initial Borrowing
Date, the Lenders shall have received collateral examination report concerning
all Rental Equipment of Holdings, the Borrower and their respective
Subsidiaries, which collateral examination shall be prepared by a third party,
and shall be in form and substance, reasonably satisfactory to the
Administrative Agent.
(s) SUBSIDIARIES GUARANTY. (i) On the Initial Borrowing Date, each
U.S. Subsidiary Guarantor shall have duly authorized, executed and delivered a
U.S. Subsidiaries Guaranty in the form of Exhibit J-1 (as modified, amended or
supplemented from time to time in accordance with the terms thereof and hereof,
the "U.S. SUBSIDIARIES GUARANTY") and the U.S. Subsidiaries Guaranty shall be in
full force and effect.
(ii) On the Initial Borrowing Date, WSC shall have duly authorized,
executed and delivered a Canadian Subsidiaries Guaranty and such Canadian
Subsidiaries Guaranty shall be in full force and effect.
(t) PLEDGE AGREEMENTS. On the Initial Borrowing Date, each U.S.
Credit Party shall have duly authorized, executed and delivered a U.S. Pledge
Agreement in the form of Exhibit K-1 (as modified, amended or supplemented from
time to time in accordance with the terms thereof and hereof, the "U.S. PLEDGE
AGREEMENT"), and shall have delivered to the Collateral Agent, as Pledgee
thereunder, all of the U.S. Pledge Agreement Collateral referred to therein and
then owned by such Credit Party, (x) endorsed in blank in the case of promissory
notes constituting U.S. Pledge Agreement Collateral and (y) together with
executed and undated endorsements for transfer in the case of equity interests
constituting certificated U.S. Pledge Agreement Collateral, along with evidence
that all other actions necessary or, in the reasonable opinion of the Collateral
Agent, desirable, to perfect the security interests purported to be created by
the U.S. Pledge Agreement have been taken, and the U.S. Pledge Agreement shall
be in full force and effect.
(u) MORTGAGES. On or prior to the Initial Borrowing Date, the
Collateral Agent shall have received:
(i) fully executed counterparts of Mortgages, in the form of
Exhibit L, which Mortgages shall cover such of the Real Property owned
by Credit Parties and listed on Part B of Schedule IV, together with
evidence that counterparts of each of the Mortgages have been delivered
to the title company insuring the Lien of the Mortgages for recording
in all places to the extent necessary or desirable, in the judgment of
the Collateral Agent, to effectively create a valid and enforceable
first priority mortgage lien (subject to Permitted Encumbrances
relating thereto) on the Mortgaged Properties in favor of the
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Collateral Agent (or such other trustee as may be required or desired
under local law) for the benefit of the Secured Creditors; and
(ii) Mortgage Policies on the Mortgages for the Mortgaged
Properties issued by a title insurance company reasonably satisfactory
to the Collateral Agent and in amounts satisfactory to the Collateral
Agent and assuring the Collateral Agent that each of the Mortgages on
such Mortgaged Properties is a valid and enforceable first priority
mortgage lien on such Mortgaged Properties, free and clear of all
defects and encumbrances except Permitted Encumbrances, and such
Mortgage Policies shall otherwise be in form and substance reasonably
satisfactory to the Collateral Agent and shall include, as appropriate,
an endorsement for future advances under this Credit Agreement and the
Notes and for any other matter that the Collateral Agent in its
discretion may reasonably request, shall not include an exception for
mechanics' liens, and shall provide for affirmative insurance and such
reinsurance as the Collateral Agent in its discretion may reasonably
request.
(v) CUSTODIAN AGREEMENT. On the Initial Borrowing Date, each
Credit Party and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, as Custodians shall have
executed and delivered a Custodian Agreement in the form of Exhibit M (as
modified, amended or supplemented from time to time in accordance with the terms
thereof and hereof, the "CUSTODIAN AGREEMENT"), and the Custodian Agreement
shall be in full force and effect.
(w) EXISTING CREDIT AGREEMENT. (i) On the Initial Borrowing Date,
the total commitments in respect of the Existing Credit Agreement shall have
been terminated (except as to indemnification and similar provisions, which may
survive to the extent provided therein), and all loans and notes (together with
interest thereon) with respect thereto shall have been repaid in full, all
letters of credit (or acceptances created thereunder) issued thereunder shall
have been terminated (or either (x) incorporated herein as Letters of Credit or
(y) fully supported with Letters of Credit issued hereunder) and all other
amounts (including premiums) owing pursuant to the Existing Credit Agreement and
all guarantees with respect thereto shall have been terminated and be of no
further force and effect. In addition, the creditors in respect of the Existing
Credit Agreement shall have terminated and released all security interests in
and Liens on the assets of Holdings and its Subsidiaries created pursuant to any
security documentation relating to the Existing Credit Agreement (including
without limitation security interests in any lock-boxes of Holdings or any of
its Subsidiaries), and such creditors shall have returned all such assets to
Holdings or such Subsidiary.
(ii) On or prior to the Initial Borrowing Date, the Administrative
Agent shall have received evidence satisfactory to it that U.S. Bank National
Association (formerly known as First Trust National Association), as Trustee for
certain former holders of Senior Secured Notes (as defined in the Existing
Credit Agreement) under that certain Amended and Restated Indenture dated as of
May 22, 1997, has acknowledged the termination of the Bailee Agreement, the
Custodian Agreement, the Deposit Account Agreement, the Collection Bank
Agreements, the Concentration Account Agreement and the Intercreditor Agreement
(as each such agreement is defined in the Existing Credit Agreement).
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(iii) The Administrative Agent shall have received evidence that the
matters set forth in this clause (w) have been satisfied on the Initial
Borrowing Date.
5.2 CONDITIONS TO ALL CREDIT EVENTS. On the date of the making of
any Loan or the issuance of any Letter of Credit, both at the time of making
thereof and after giving effect thereto and to the application of the proceeds
therefrom, the following statements shall be true to the satisfaction of the
Administrative Agent (and each delivery or deemed delivery of each Notice of
Borrowing and a Letter of Credit Request, and the acceptance by the Borrower of
the proceeds of such Loan or the issuance of such Letter of Credit, shall
constitute a representation and warranty by each of Holdings and the Borrower
that on the date of such Loan or issuance of such Letter of Credit at the time
of making thereof and after giving effect thereto and to the application of the
proceeds therefrom, such statements are true):
(a) the representations and warranties contained in this Credit
Agreement and in each other Credit Document are true and correct in all material
respects on and as of the date of such Loan or issuance of such Letter of Credit
as though made on and as of such date, except to the extent that such
representations and warranties expressly relate to an earlier date (in which
case such representations and warranties shall have been true and accurate on
and as of such earlier date);
(b) no event has occurred and is continuing, or would result from
such Loan or the issuance of any Letter of Credit or the application of the
proceeds thereof, which would constitute a Default or an Event of Default; and
(c) with respect to the issuance of any Letter of Credit, none of
the events set forth in Section 3.1 has occurred and is continuing or would
result from the issuance of such Letter of Credit.
The acceptance of the benefits of each Credit Event shall constitute a
representation and warranty by each Credit Party to each of the Lenders that all
of the applicable conditions specified above exist as of the date of such Credit
Event. All of the certificates, legal opinions and other documents and papers
referred to in this Section 5, unless otherwise specified, shall be delivered to
the Administrative Agent at the location where the closing occurs for the
account of each of the Lenders and, except for the Notes, in sufficient
counterparts or copies for each of the Lenders and shall be in form and
substance as specified herein or otherwise satisfactory to the Administrative
Agent.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES
------------------------------
To induce the Lenders to enter into this Credit Agreement and to make
the Loans and issue and/or participate in the Letters of Credit provided for
herein, each of Holdings and the Borrower makes the following representations,
warranties and agreements, as to itself and as to each of its respective
Subsidiaries, all of which shall survive the execution and delivery of this
Credit Agreement, the making of the Loans and the issuance of the Letters of
Credit (with the occurrence of each Credit Event being deemed to constitute a
representation and warranty that
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the matters specified in this Article 6 are true and correct in all material
respects on and as of the date of each such Credit Event, unless stated to
relate to a specific earlier date, in which case they will be true and correct
as of such earlier date):
6.1 CORPORATE STATUS. Each Credit Party (i) is a duly organized
and validly existing corporation, limited liability company or partnership, as
the case may be, in good standing under the laws of the jurisdiction of its
organization and has the corporate, limited liability company or partnership
power and authority, as the case may be, to own its property and assets and to
transact the business in which it is engaged and presently proposes to engage
and (ii) has duly qualified and is authorized to do business and is in good
standing in all jurisdictions where it is required to be so qualified and where
the failure to be so qualified could reasonably be expected to have a Material
Adverse Effect.
6.2 CORPORATE POWER AND AUTHORITY. Each Credit Party has the
corporate power and authority to execute, deliver and carry out the terms and
provisions of the Credit Documents to which it is a party and has taken all
necessary corporate action to authorize the execution, delivery and performance
of the Credit Documents to which it is a party. Each Credit Party has duly
executed and delivered each Credit Document to which it is a party and each such
Credit Document constitutes the legal, valid and binding obligation of such
Credit Party enforceable in accordance with its terms, except that such
enforceability may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws of general application relating to
or affecting the rights and remedies of creditors and general equitable
principles (regardless of whether enforcement is sought in equity or at law) and
(ii) federal securities or other laws or regulations or public policy insofar as
they may restrict the enforceability of rights to indemnification.
6.3 NO VIOLATION. Neither the execution, delivery and performance
by any Credit Party of the Credit Documents to which it is a party nor
compliance with the terms and provisions thereof, nor the consummation of the
transactions contemplated therein (i) will contravene any applicable provision
of any law, statute, rule, regulation, order, writ, injunction or decree of any
court or governmental instrumentality, (ii) will conflict or be inconsistent
with or violate or result in any breach of any of the terms, covenants,
conditions or provisions of, or constitute a default under, or (other than
pursuant to the Collateral Documents) result in the creation or imposition of
(or the obligation to create or impose) any Lien upon any of the property or
assets of such Credit Party or any of its Subsidiaries pursuant to the terms of
any indenture, mortgage, deed of trust, agreement or other instrument to which
such Credit Party or any of its Subsidiaries is a party or by which it or any of
its property or assets are bound or to which it may be subject or (iii) will
violate any provision of any Governing Document of Holdings, the Borrower or any
of their respective Subsidiaries, except, in the case of clauses (i) and (ii),
any contraventions, conflicts, inconsistencies, breaches and defaults which are
not reasonably likely to adversely affect any Lender or to have a Material
Adverse Effect. In no event shall any Credit Event hereunder conflict or be
inconsistent with or violate or result in any breach of any of the terms,
covenants, conditions or provisions of, or constitute a default under, the
Senior Unsecured Notes Indenture.
6.4 LITIGATION. There are no actions, suits or proceedings pending
or threatened with respect to (i) any Credit Document or (ii) Holdings, the
Borrower or any of their respective
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Subsidiaries that, after giving effect to expected insurance proceeds and
indemnity payments, are reasonably likely, either individually or in the
aggregate, to have a Material Adverse Effect.
6.5 USE OF PROCEEDS. (a) All proceeds of the Term Loans shall be
utilized (i) to finance, in part, the Refinancing and (ii) to pay certain fees
and expenses in connection therewith and in connection with this Credit
Agreement.
(b) All proceeds of Revolving Loans shall be utilized (i) to
finance, in part, the Refinancing and (ii) for general corporate purposes,
Capital Expenditures and working capital of the Borrower and its Subsidiaries,
including acquisitions permitted hereunder.
(c) No part of the proceeds of any Loan and no Letter of Credit
will be used to purchase or carry any Margin Stock or to extend credit for the
purpose of purchasing or carrying any Margin Stock. Neither the making of any
Loan nor the use of the proceeds thereof nor the occurrence of any other Credit
Event will violate or be inconsistent with the provisions of Regulations T, U,
or X of the Board of Governors of the Federal Reserve System.
6.6 GOVERNMENTAL APPROVALS. Except for the filing of the Mortgages
and the filing of the financing statements and for any other filings,
registrations or recordings required under the Collateral Documents (all of
which have been made or will be made as required) and any consents to
assignments of any Government Lease, no order, consent, approval, license,
authorization, or validation of, or filing, recording or registration with, or
exemption by, any foreign or domestic governmental or public body or authority,
or any subdivision thereof, is required to authorize or is required in
connection with (i) the execution, delivery and performance by the Credit
Parties of the Credit Documents or (ii) the legality, validity, binding effect
or enforceability of any Credit Document as against each Credit Party which is a
party thereto.
6.7 INVESTMENT COMPANY ACT. None of Holdings, the Borrower or any
of their respective Subsidiaries is registered, or required to register, as an
"investment company" or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended.
6.8 PUBLIC UTILITY HOLDING COMPANY ACT. None of Holdings, the
Borrower or any of their respective Subsidiaries is a "holding company", or a
"subsidiary company" of a "holding company", or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company", within the meaning
of the Public Utility Holding Company Act of 1935, as amended.
6.9 TRUE AND COMPLETE DISCLOSURE. All factual information (taken
as a whole) heretofore or contemporaneously furnished by or on behalf of
Holdings or the Borrower in writing to any Agent or any Lender for purposes of
or in connection with this Credit Agreement or any other Credit Document or any
transaction contemplated herein or therein does not, and all other such factual
information (taken as a whole) hereafter furnished by or on behalf of Holdings
or the Borrower in writing to any Agent or any Lender will not, as of the date
as of which such information is dated or certified, contain any untrue statement
of a material fact or omit to state any material fact necessary to make such
information (taken as a whole) not misleading as of
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such time, in each case in light of the circumstances under which such
information was provided, it being understood and agreed that for purposes of
this Section 6.9, such factual information shall not include the Projections or
PRO FORMA financial information.
6.10 FINANCIAL CONDITION; FINANCIAL STATEMENTS. (a) On and as of
the Initial Borrowing Date after giving effect to the Refinancing and all
Indebtedness incurred, and to be incurred, and Liens created and to be created,
by each Credit Party in connection with this Credit Agreement, (x) the sum of
the assets, at a fair valuation, of Holdings and its Subsidiaries, taken as a
whole, will exceed their debts, (y) the Borrower and its Subsidiaries, taken as
a whole, will not have incurred nor intend to, or believe that they will, incur
debts beyond their ability to pay such debts as such debts mature and (z) the
Borrower does not have unreasonably small capital with which to conduct its
businesses. For purposes of this Section 6.10(a), "debt" means any reasonably
expected liability on a claim, and "claim" means (i) right to payment whether or
not such a right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured
or unsecured; or (ii) right to an equitable remedy for breach of performance if
such breach gives rise to a payment, whether or not such right to an equitable
remedy is reduced to judgment, fixed, contingent, matured, unmatured, disputed,
undisputed, secured or unsecured.
(b) The unaudited consolidated balance sheets of Holdings and its
Subsidiaries as of, and unaudited statements of operations, shareholder's equity
and cash flows for the fiscal year ended, December 31, 2001 furnished to the
Administrative Agent and the Lenders prior to the Initial Borrowing Date,
present fairly the financial condition at such dates of such balance sheets and
results of operations for the fiscal year. Since December 31, 2001, nothing has
occurred which has had or would be reasonably likely to result in a Material
Adverse Effect.
(c) The Projections have been prepared by the Borrower in good
faith and are based on assumptions which the Borrower believed to be reasonable
at the time the Projections were prepared by the Borrower and on the Initial
Borrowing Date. On the Initial Borrowing Date, the Borrower believes that the
Projections are reasonable and attainable, it being recognized by the Lenders,
however, that projections as to future events are not to be viewed as facts and
that the actual results during the period or periods covered by the such
projections may differ from the projected results.
6.11 LOCATIONS OF OFFICES, RECORDS, INVENTORY AND RENTAL EQUIPMENT.
The address of the principal place of business and chief executive office of
each Credit Party as of the Initial Borrowing Date is set forth on Schedule VI.
The books and records of each Credit Party, and all its chattel paper and
records of Accounts and Unit Certificates, are, as of the Initial Borrowing
Date, maintained exclusively at the respective locations listed on Schedule VI.
As of the Initial Borrowing Date, there is no jurisdiction (or, with respect to
the Rental Equipment, State) in which any Credit Party has any chattel paper,
records of Account, Rental Equipment (except for Rental Equipment in transit) or
Unit Certificates other than those jurisdictions (or States) identified on
Schedule VI. Schedule VI also contains a complete list of the legal names and
addresses of each facility or warehouse at which Rental Equipment is stored as
of the Initial Borrowing Date. None of the receipts received by the Borrower
from any warehouseman states
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that the goods covered thereby are to be delivered to bearer or to the order of
a named Person other than the Borrower or to a named Person and such named
Person's assigns.
6.12 SECURITY INTERESTS. Subject to Section 11.19 and any effective
restriction on the assignment of any Government Lease contained therein (or in
any applicable governmental rule or regulation related thereto), on and after
the Initial Borrowing Date, each of the Collateral Documents create, as security
for the Obligations, a valid and enforceable perfected security interest in and
Lien on all of the Collateral, superior to and prior to the rights of all third
persons and subject to no other Liens other than Liens permitted by Section 8.2.
At all times on or after the Initial Borrowing Date, the respective grantor
under each Collateral Document shall have good and marketable title to all the
Collateral subject thereto free and clear of all Liens other than Permitted
Liens. No filings or recordings are required in order to perfect the security
interests created under any Collateral Document except for filings or recordings
required pursuant to the terms of any such Collateral Document.
6.13 TAX RETURNS AND PAYMENTS. Each of Holdings, the Borrower and
each of their respective Subsidiaries has timely filed or caused to be timely
filed with the appropriate taxing authority, all federal returns and all other
material returns, statements, forms and reports for taxes required to be filed
by or with respect to the income, properties or operations of Holdings, the
Borrower and any of their respective Subsidiaries. Such returns accurately
reflect all liability for taxes of Holdings, the Borrower and their respective
Subsidiaries for the periods covered thereby. Each of Holdings, the Borrower and
each of their respective Subsidiaries has paid all material taxes payable by it
other than taxes which are not due, and other than those contested in good faith
and for which adequate reserves have been established in accordance with GAAP.
Except as set forth on Schedule VII, there is no material action, suit,
proceeding, investigation, audit or claim now pending or, to the knowledge of
Holdings or the Borrower, threatened by any authority regarding any taxes
relating to Holdings, the Borrower or any of their respective Subsidiaries. As
of the Initial Borrowing Date, none of Holdings, the Borrower or any of their
respective Subsidiaries has entered into an agreement or waiver or been
requested to enter into an agreement or waiver extending any statute of
limitations relating to the payment or collection of material taxes of Holdings,
the Borrower or any of their respective Subsidiaries, or is aware of any
circumstances that would cause the taxable years or other taxable periods of
Holdings, the Borrower or any of their respective Subsidiaries not to be subject
to the normally applicable statute of limitations with respect to any material
taxes.
6.14 COMPLIANCE WITH ERISA. (i) Schedule VIII identifies each Plan;
each Plan (and each related trust, insurance contract or fund) is in substantial
compliance with its terms and with all applicable laws, including, without
limitation, ERISA and the Code; each Plan (and each related trust, if any) which
is intended to be qualified under Section 401(a) of the Code has received a
determination letter from the Internal Revenue Service to the effect that it
meets the requirements of Sections 401(a) and 501(a) of the Code; no Reportable
Event has occurred; no Plan which is a Multiemployer Plan is insolvent or in
reorganization; no Plan subject to Title IV of ERISA has an Unfunded Current
Liability which, when added to the aggregate amount of Unfunded Current
Liabilities with respect to all other Plans subject to Title IV of ERISA,
exceeds $1,000,000; no Plan which is subject to Section 412 of the Code or
Section 302 of ERISA has an accumulated funding deficiency, within the meaning
of such sections of the Code or ERISA, or has applied for or received a waiver
of an accumulated funding deficiency or an
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extension of any amortization period, within the meaning of Section 412 of the
Code or Section 303 or 304 of ERISA; all contributions required to be made with
respect to a Plan have been timely made; neither Holdings nor any Subsidiary of
Holdings nor any ERISA Affiliate has incurred any material liability (including
any indirect, contingent or secondary liability) to or on account of a Plan
pursuant to Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204
or 4212 of ERISA or Section 401(a)(29), 4971 or 4975 of the Code or expects to
incur any such liability under any of the foregoing sections with respect to any
Plan; no condition exists which presents a material risk to Holdings or any
Subsidiary of Holdings or any ERISA Affiliate of incurring a liability to or on
account of a Plan pursuant to the foregoing provisions of ERISA and the Code; no
proceedings have been instituted to terminate or appoint a trustee to administer
any Plan which is subject to Title IV of ERISA; no action, suit, proceeding,
hearing, audit or investigation with respect to the administration, operation or
the investment of assets of any Plan (other than routine claims for benefits) is
pending, expected or, to the best knowledge of Holdings, any Subsidiary of
Holdings or any ERISA Affiliate, threatened; using actuarial assumptions and
computation methods consistent with Part 1 of subtitle E of Title IV of ERISA,
the aggregate liabilities of Holdings and its Subsidiaries and its ERISA
Affiliates to all Plans which are multiemployer plans (as defined in Section
4001(a)(3) of ERISA) in the event of a complete withdrawal therefrom, as of the
close of the most recent fiscal year of each such Plan ended prior to the date
of the most recent Credit Event, would not exceed $1,000,000; each group health
plan (as defined in Section 607(1) of ERISA or Section 4980B(g)(2) of the Code)
which covers or has covered employees or former employees of the Borrower, any
Subsidiary of the Borrower, or any ERISA Affiliate has at all times been
operated in compliance with the provisions of Part 6 of subtitle B of Title I of
ERISA and Section 4980B of the Code; no lien imposed under the Code or ERISA on
the assets of Holdings or any Subsidiary of Holdings or any ERISA Affiliate
exists or is likely to arise on account of any Plan and Holdings and its
Subsidiaries do not maintain or contribute to any employee welfare benefit plan
(as defined in Section 3(1) of ERISA) which provides benefits to retired
employees or other former employees (other than as required by Section 601 of
ERISA or any other applicable continuation of coverage laws or regulations) or
any Plan the obligations with respect to which could reasonably be expected to
have a Material Adverse Effect.
(ii) Each Foreign Pension Plan has been maintained in substantial
compliance with its terms and with the requirements of any and all applicable
laws, statutes, rules, regulations and orders and has been maintained, where
required, in good standing with applicable regulatory authorities. All
contributions required to be made with respect to a Foreign Pension Plan have
been timely made. None of Holdings, the Borrower or any of their respective
Subsidiaries has incurred any obligation in connection with the termination of
or withdrawal from any Foreign Pension Plan. The present value of the accrued
benefit liabilities (whether or not vested) under each Foreign Pension Plan,
determined as of the end of Holdings' most recently ended fiscal year on the
basis of actuarial assumptions, each of which is reasonable, did not exceed the
current value of the assets of such Foreign Pension Plan allocable to such
benefit liabilities.
6.15 SUBSIDIARIES. Schedule IX hereto lists each Subsidiary of the
Borrower, and the direct and indirect ownership interest of the Borrower
therein, in each case existing on the Initial Borrowing Date. Holdings is the
record and beneficial owner of 100% of the capital stock of the Borrower, and
the Borrower is the record and beneficial owner of 100% of the capital
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stock of the Unit Subsidiary. On the Effective Date, Holdings has no significant
assets or liabilities other than its ownership of the capital stock of the
Borrower and any liabilities directly related thereto, and on such date Holdings
owns no other capital stock of any other Person.
6.16 INTELLECTUAL PROPERTY; ETC. Holdings, the Borrower and each of
their respective Subsidiaries have obtained all material patents, trademarks,
servicemarks, trade names, copyrights, licenses and other rights, free from
burdensome restrictions, that are necessary for the operation of their
respective businesses as presently conducted and as proposed to be conducted.
6.17 COMPLIANCE WITH STATUTES, ETC. (a) Each of Holdings, the
Borrower and their respective Subsidiaries is in compliance with all applicable
statutes, regulations and orders of, and all applicable restrictions imposed by,
all governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property, except such instances of
noncompliance as could not, either individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.
(b) Each of Holdings, the Borrower and their respective
Subsidiaries is in compliance with all applicable Environmental Laws governing
its business for which failure to comply could reasonably be expected to have a
Material Adverse Effect and none of Holdings, the Borrower or any of their
respective Subsidiaries is liable for any material penalties, fines or
forfeitures for failure to comply with such Environmental Laws in the manner set
forth above. All licenses, permits, registrations or approvals required for the
business of Holdings, the Borrower and each of their respective Subsidiaries, as
conducted as of the Initial Borrowing Date, under any Environmental Law have
been secured and each of Holdings, the Borrower and their respective
Subsidiaries is in substantial compliance therewith, except such licenses,
permits, registrations or approvals, the failure to secure or to comply
therewith could not reasonably be expected to have a Material Adverse Effect.
None of Holdings, the Borrower or any of their respective Subsidiaries is in any
material respect in noncompliance with, breach of or default under any
applicable writ, order, judgment, injunction, or decree to which Holdings, the
Borrower or any such Subsidiary is a party and which would materially and
adversely affect the ability of Holdings, the Borrower or any such Subsidiary to
operate its business or Real Property and no event has occurred and is
continuing which, with the passage of time or the giving of notice or both,
would constitute material noncompliance, breach of or default thereunder, except
in each such case, such noncompliances, breaches and/or defaults as could not,
either individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. There are as of the Initial Borrowing Date no
Environmental Claims pending or, to the best knowledge of the Borrower,
threatened, which question the validity, term or entitlement of Holdings, the
Borrower or any of their respective Subsidiaries for any permit, license, order
or registration required for the operation of any facility which Holdings, the
Borrower or any of their respective Subsidiaries currently operates. There are
no facts, circumstances, conditions or occurrences concerning the business or
operations of Holdings, the Borrower or any of their respective Subsidiaries, or
any Real Property at any time owned or operated by Holdings, the Borrower or any
of their respective Subsidiaries, or, to the best of their knowledge, on any
property adjoining or adjacent to any such Real Property, that are reasonably
expected (i) to form the basis of a material Environmental Claim against
Holdings, the Borrower or any of their respective Subsidiaries or any currently
owned Real Property of Holdings, the Borrower or any
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of their respective Subsidiaries, or (ii) to cause such currently owned Real
Property to be subject to any material restrictions on the ownership, occupancy,
use or transferability of such Real Property under any Environmental Law, except
in each such case, such environmental claims or restrictions that individually,
or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect.
(c) Hazardous Materials have not at any time been (i) generated,
used, treated or stored on, or transported to or from, by Holdings, the Borrower
or any of their respective Subsidiaries, any Real Property of Holdings, the
Borrower or any of their respective Subsidiaries or (ii) released or disposed of
on any such Real Property, except Hazardous Materials generated, used, treated
or stored on, or transported to or from, any Real Property of Holdings, the
Borrower or any of their respective Subsidiaries in the ordinary course of
business and in material compliance with Environmental Laws.
6.18 PROPERTIES. Each of Holdings, the Borrower and their
respective Subsidiaries has good title to all material properties (excluding
intellectual property which is covered in Section 6.16) owned by it free and
clear of all Liens, other than Permitted Liens. Part A of Schedule IV contains a
true and complete list of each Real Property owned and leased by Holdings, the
Borrower or their respective Subsidiaries on the Initial Borrowing Date and the
type of interest therein held by Holdings, the Borrower or such Subsidiary.
6.19 LABOR RELATIONS; COLLECTIVE BARGAINING AGREEMENTS. (a) Set
forth on Schedule X hereto is a list (including dates of termination) of all
Collective Bargaining Agreements in effect on the Initial Borrowing Date.
(b) None of Holdings, the Borrower nor any of their respective
Subsidiaries is engaged in any unfair labor practice that could reasonably be
expected to have a Material Adverse Effect. There is (i) no significant unfair
labor practice complaint pending against Holdings, the Borrower or any of their
respective Subsidiaries or, to the best knowledge of Holdings and the Borrower,
threatened against any of them, before the National Labor Relations Board, and
no significant grievance or significant arbitration proceeding arising out of or
under any collective bargaining agreement is pending on the Initial Borrowing
Date against Holdings, the Borrower or any of their respective Subsidiaries or,
to the best knowledge of Holdings and the Borrower, threatened against any of
them, (ii) no significant strike, labor dispute, slowdown or stoppage is pending
against Holdings, the Borrower or any of their respective Subsidiaries or, to
the best knowledge of Holdings and the Borrower, threatened against any of them
except (with respect to any matter specified in clause (i) and (ii) above,
either individually or in the aggregate) such as could not reasonably likely to
have a Material Adverse Effect.
6.20 RESTRICTIONS ON SUBSIDIARIES. Except for restrictions
contained in the Credit Documents, the Senior Unsecured Notes Documents and in
agreements with respect to the Existing Indebtedness, as of the Initial
Borrowing Date there are no effective contractual or consensual restrictions on
the Borrower or any of its Subsidiaries which prohibit or otherwise restrict (i)
the transfer of cash or other assets (x) between Holdings and any of its
Subsidiaries or (y) between any Subsidiaries of Holdings or (ii) the ability of
Holdings or any of its Subsidiaries to grant security interests to the Lenders
in the Collateral (except that certain Government Leases may have restrictions
on the assignment thereof).
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6.21 STATUS OF ACCOUNTS. Each Account is based on an actual and
bona fide lease or sale and delivery of goods (including Rental Equipment) or
rendition of services to customers, made by the Borrower and its Subsidiaries in
the ordinary course of its business; the goods, Inventory and Rental Equipment
being sold or leased and the Accounts created are its property and are not and
shall not be subject to any Lien, consignment arrangement, encumbrance, security
interest or financing statement whatsoever other than the Liens created pursuant
to the Collateral Documents and Permitted Liens, and, except as otherwise
reported or reserved against on the Borrower's or its Subsidiaries' books and
records or to the extent excluded from the Borrowing Base, the Borrower's and
its Subsidiaries' customers have accepted the goods or services, owe and are
obligated to pay the full amounts stated in the invoices according to their
terms, without any dispute, offset, defense, or counterclaim.
6.22 MATERIAL CONTRACTS. None of Holdings, the Borrower, or any of
their respective Subsidiaries is in breach of or in default under any Material
Contract.
6.23 EXISTING INDEBTEDNESS AND OPERATING LEASES. (a) Part A of
Schedule III sets forth a true and complete list of all Existing Indebtedness
(excluding any existing Indebtedness with an aggregate principal amount then
outstanding of less than $1,000,000, so long as the aggregate principal amount
of outstanding Existing Indebtedness excluded pursuant to this parenthetical
does not exceed $4,000,000) of Holdings, the Borrower and their respective
Subsidiaries as of the Initial Borrowing Date, in each case showing the
aggregate principal amount thereof and the name of the respective borrower and
any other entity which directly or indirectly guaranteed such debt.
(b) Part B of Schedule III sets forth a true and complete list of
all Operating Leases of Real Property leased by Holdings, the Borrower and their
respective Subsidiaries, in each case showing the aggregate annual lease
payments with respect to each such Operating Lease, the respective lessee
thereunder and any other entity which has directly or indirectly guaranteed any
obligations of the lessee thereunder.
6.24 GUARANTEE OF CERTAIN NOTES; SUBORDINATED GUARANTOR SENIOR
INDEBTEDNESS; CREDIT AGREEMENT; ETC. (a) No Subsidiary of Holdings has
guaranteed the Senior Unsecured Notes, other than the Subsidiary Guarantors.
(b) All obligations of the Unit Subsidiary as a Subsidiary
Guarantor (including, without limitation, its guarantee of the principal of,
interest on, and other amounts relating to, the Outstandings) under the
Subsidiaries Guaranty constitute "Subordinated Guarantor Senior Indebtedness"
under, and as defined in, the Senior Unsecured Notes Indenture.
(c) This Credit Agreement constitutes the "Credit Agreement"
under, and as defined in, the Senior Unsecured Notes Indenture.
6.25 UNIT SUBSIDIARY. Unit Subsidiary is a direct Wholly-Owned
Domestic Subsidiary of the Borrower (all of the equity interests in which are
pledged to the U.S. Pledgee pursuant to the Pledge Agreement). All Non-Qualified
Units owned by Holdings or any of its Subsidiaries which are located in the
United States of America or any State or territory thereof are owned by the Unit
Subsidiary or, if acquired by the Borrower or any of its Subsidiaries after
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the Effective Date, shall within five Business Days after the month in which
such acquisition occurred, be contributed to the equity of the Unit Subsidiary.
6.26 RENTAL EQUIPMENT; BUSINESS OF THE CREDIT PARTIES. (a) Each
U.S. Credit Party that owns Rental Equipment holds such Rental Equipment for
sale or lease and is in the business of selling goods of that kind.
(b) Each Canadian Subsidiary Guarantor that owns Rental Equipment
(i) holds such Rental Equipment for sale or lease, or has leased such Rental
Equipment, or (ii) is to furnish such Rental Equipment, or has furnished such
Rental Equipment, under a contract of service.
6.27 LEGAL NAMES; TYPE OF ORGANIZATION (AND WHETHER A REGISTERED
ORGANIZATION); JURISDICTION OF ORGANIZATION; ETC. Schedule XI attached hereto
contains (i) the exact legal name of Holdings, the Borrower and each Subsidiary
Guarantor, (ii) the type of organization of Holdings, the Borrower and each
Subsidiary Guarantor, (iii) whether or not Holdings, the Borrower and each
Subsidiary Guarantor is a registered organization, (iv) the jurisdiction of
organization of Holdings, the Borrower and each Subsidiary Guarantor, (v) the
Borrower's and each Subsidiary Guarantor's Location and (vi) the organizational
identification number (if any) of Holdings, the Borrower and each Subsidiary
Guarantor. To the extent that Holdings, the Borrower or any Subsidiary Guarantor
does not have an organizational identification number on the date hereof and
later obtains one, Holdings, the Borrower or such Subsidiary Guarantor shall
promptly thereafter notify the Collateral Agent of such organizational
identification number and shall take all actions reasonably satisfactory to the
Collateral Agent to the extent necessary to maintain the security interest of
the Collateral Agent in the Collateral intended to be granted pursuant to the
Collateral Documents fully perfected and in full force and effect.
6.28 INSURANCE. Schedule XII hereto set forth a true and complete
listing of all insurance maintained by Holdings, the Borrower and each of their
respective Subsidiaries as of the Effective Date.
6.29 OWNERSHIP OF RENTAL EQUIPMENT. All Rental Equipment (x)
located in the United States or any State thereof is owned by the Borrower or a
US Subsidiary Guarantor organized under the laws of a State of the United States
and (y) all Rental Equipment located in Canada is owned by a Canadian Subsidiary
Guarantor organized under the laws of a Qualified Canadian Jurisdiction.
6.30 NO PERMITTED UNITS FINANCING OR ATTRIBUTABLE DEBT. None of
Holdings, the Borrower, or any of their respective Subsidiaries have incurred or
will incur any Permitted Units Financing (as defined in the Senior Unsecured
Notes Indenture) under Section 4.09(b)(13)(i) or any Attributable Debt (as
defined in the Senior Unsecured Notes Indenture) under Section 4.09(b)(12) of
the Senior Unsecured Notes Indenture.
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ARTICLE 7
AFFIRMATIVE COVENANTS
---------------------
Subject to Section 11.19, each of Holdings and the Borrower hereby
covenants and agrees that on the Effective Date and thereafter, for so long as
this Credit Agreement is in effect and until the Total Commitments have
terminated, no Letters of Credit or Notes are outstanding and all Loans and
Letter of Credit Obligations, together with interest, Fees, Expenses and all
other Obligations then due and payable, are paid in full:
7.1 FINANCIAL INFORMATION. The Borrower shall furnish to the
Administrative Agent (who shall then make available to the Lenders) the
following information within the following time periods:
(a) as soon as available and in any event within 90 days (or 120
days in the case of the item described in clause (B) below only) after the end
of each fiscal year of Holdings or the Borrower, as applicable, (i) audited
Financial Statements as of the close of such fiscal year and for such fiscal
year, together with a comparison to the Financial Statements for the prior year,
in each case accompanied by (A) a report thereon of the Auditors thereof
unqualified as to scope, which report shall state that such consolidated
financial statements fairly present the consolidated financial position of
Holdings and its consolidated Subsidiaries and the Borrower and its consolidated
Subsidiaries, as applicable, as at the date indicated and the results of their
operations and cash flows for the periods indicated in conformity with GAAP
(except as otherwise stated therein) and that the examination by such Auditors
has been made in accordance with generally accepted auditing standards, (B) such
Auditors' management letter to Holdings or the Borrower, as the case may be, (C)
a written statement signed by the Auditors stating that in the course of the
annual audit of the business of Holdings and its consolidated Subsidiaries or
the Borrower and its consolidated Subsidiaries, as applicable, which audit was
conducted by the Auditors in accordance with generally accepted auditing
standards, such Auditors have not obtained any knowledge of the existence of any
Default or Event of Default under any provision of Sections 8.4, 8.9, 8.10 and
8.11 of this Credit Agreement, or, if such Auditors shall have obtained from
such examination any such knowledge, they shall disclose in such written
statement the existence of the Default or Event of Default and the nature
thereof, it being understood that such Auditors shall not be required hereunder
to perform any special audit procedures and shall have no liability, directly or
indirectly, to anyone for failure to obtain knowledge of any such Default or
Event of Default and (ii) in the case of the Financial Statements of Holdings, a
compliance certificate signed by its chief executive officer, chief financial
officer, treasurer or controller substantially in the form of Exhibit O, which
certificate shall (A) include a schedule in form satisfactory to the
Administrative Agent of the calculations used in determining, as of the end of
such fiscal year, whether the Borrower was in compliance with the covenants set
forth in Articles 7 and 8 of this Credit Agreement for such year and (B) either
(x) certify that no changes are required to be made to any of Schedule VI or XI
hereto, Annexes C, F, H, I, J or K of the U.S. Security Agreement, Annexes A
through F of the U.S. Pledge Agreement or Schedules 2.1(1)(f), 2.1(1)(h), 4.1(d)
or 4.1(e) (or any analogous Schedules) to any Canadian Security Agreement, in
each case so as to make the information set forth therein accurate and complete
as of the date of such certificate, or (y) to the extent that any such
information is no longer accurate and complete as of such date, list in
reasonable detail all
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information necessary to make all such Schedules and Annexes accurate and
complete (as which time such Schedules and/or such Annexes, as the case may be,
shall be deemed modified to reflect such information). To the extent that
Holdings' or the Borrower's, as the case may be, annual report on Form 10-K
contains any of the foregoing items, the Lenders will accept Holdings' or the
Borrower's, as the case may be, report on Form 10-K in lieu of such items;
(b) as soon as available and in any event within 45 days after the
end of each fiscal quarter of Holdings or the Borrower, as applicable, (except
the last fiscal quarter of any fiscal year) (i) Financial Statements as at the
end of such period and for the fiscal year to date, together with a comparison
to the Financial Statements for the same periods in the prior year, all in
reasonable detail and duly certified by the chief executive officer, chief
financial officer, treasurer or controller of Holdings or the Borrower, as
applicable, as having been prepared substantially in accordance with GAAP
(subject to the absence of footnotes and audit and normal year-end adjustments)
and (ii) a compliance certificate signed by chief executive officer, chief
financial officer, treasurer or controller of Holdings substantially in the form
of Exhibit O, which certificate shall (A) include a schedule in form
satisfactory to the Administrative Agent of the calculations used in
determining, as of the end of such fiscal quarter, whether the Borrower was in
compliance with the covenants set forth in Articles 7 and 8 of this Credit
Agreement for such quarter, and (B) either (x) certify that no changes are
required to be made to any of Schedules VI or XI hereto, Annexes C, F, H, I, J
or K of the U.S. Security Agreement, Annexes A through F of the U.S. Pledge
Agreement or Schedules 2.1(1)(f), 2.1(1)(h), 4.1(d) or 4.1(e) (or any analogous
Schedules) to any Canadian Security Agreement, in each case so as to make the
information set forth therein accurate and complete as of the date of such
certificate, or (y) to the extent that such information is no longer accurate
and complete as of such date, list in reasonable detail all information
necessary to make all such Schedules and Annexes accurate and complete (at which
time such Schedules and/or such Annexes, as the case may be, shall be deemed
modified to reflect such information). To the extent that Holdings' or the
Borrower's, as the case may be, quarterly report on Form 10-Q contains any of
the foregoing items, the Lenders will accept Holdings' or the Borrower's, as the
case may be, report on Form 10-Q in lieu of such items;
(c) as soon as available and in any event within 30 days after the
end of each month (except the last month of any fiscal quarter, with respect to
which such reports shall be delivered within 45 days after the end of the month
(other than the last quarter of the fiscal year, with respect to which such
reports shall be delivered within 90 days after the end of the month)), a
consolidated balance sheet for the Borrower and its consolidated Subsidiaries as
at the end of such month and consolidated statements of operations and cash
flows for such month and for the fiscal year to date, together with a comparison
to the consolidated balance sheet, statement of operations and statement of cash
flows for the same periods in the prior year, all in reasonable detail and duly
certified (subject to the addition of footnotes and audit and normal year-end
adjustments) by the chief executive officer, chief financial officer, treasurer
or controller of the Borrower as having been prepared substantially in
accordance with GAAP;
(d) not later than 60 days after the end of each fiscal year
commencing with the fiscal year ending December 31, 2002, quarterly consolidated
projections (in substantially the same form as the Projections) for Holdings and
its Subsidiaries for the following fiscal year and annual projections for each
subsequent fiscal year through and including the fiscal year in which the
Maturity Date occurs;
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(e) upon request by the Administrative Agent at any time if a
Default or Event of Default shall exist and in any event within 30 days after
the last Business Day of each month (or more frequently if requested by the
Administrative Agent in the exercise of its Permitted Discretion), a Borrowing
Base certificate (the "BORROWING BASE CERTIFICATE") in substantially the form of
Exhibit P, duly completed, as of the last day of such month (or such other date
as the Administrative Agent may specify in such request) and certified by the
Borrower's chief executive officer, chief financial officer, treasurer or
controller and subject only to adjustment upon completion of the normal year-end
audit. In addition, each Borrowing Base Certificate shall have attached to it
such additional schedules and/or other information, including monthly aging
reports, as the Administrative Agent may reasonably request;
(f) as soon as possible after the end of each calendar month, but
in any event not later than 30 (or, in the case of clauses (C) and (D) below,
35) days after the end of such month (or more frequently as the Administrative
Agent may reasonably request), (A) a certificate setting forth the Average
Rental Rate (excluding Sales-Type Leases), (B) a certificate setting forth the
Average Lease Term and the detail of the calculation thereof as of the last day
of the immediately preceding fiscal month, (C) a listing of each Lease in effect
as of the last day of such month setting forth on such listing the name of the
account debtor with respect to each such Lease, the date of each such Lease, the
number of units of Rental Equipment subject to each such Lease, the amount of
the contractual monthly rental and the fixed minimum term for each such Lease,
(D) a listing of the units of Rental Equipment at the branch office locations of
Borrower and each of its Subsidiaries, indicating the units of Rental Equipment
at each branch office location as of the end of the immediately preceding month,
(E) the Utilization as of the end of the immediately preceding month and the
average Utilization for the 13 months then last ended (calculated by taking the
average of the Utilization for each of such 13 months then last ended), and (F)
the average age of all Rental Equipment not constituting storage units (taken as
a whole) and the average age of all Rental Equipment constituting storage units
(taken as a whole), in each case as of the end of the immediately preceding
month;
(g) promptly and in any event within five Business Days after
becoming aware of the occurrence of any event which constitutes a Default or
Event of Default, a certificate of the chief executive officer or chief
financial officer of the Borrower specifying the nature thereof and the
Borrower's proposed response thereto, each in reasonable detail;
(h) within 30 days after the end of each month (except the last
month of any fiscal quarter, with respect to which such reports shall be
delivered within 45 days after the end of the month (other than the last quarter
of the fiscal year with respect to which such reports shall be delivered within
90 days after the end of the month)), a comparison of consolidated actual
results of operations, cash flow and Capital Expenditures for the Borrower and
its Subsidiaries for such month and for the period from the beginning of the
current fiscal year through the end of such month (i) with amounts projected for
such month and for the period from the beginning of the current fiscal year
through the end of such month pursuant to the projections delivered pursuant to
Section 5.1(o) or, in the case of any fiscal year commencing after the delivery
of projections pursuant to Section 7.1(d) above, the most recent projections
delivered pursuant to Section 7.1(d);
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(i) promptly upon the earlier of the delivery or filing thereof,
copies of all ▇▇-▇▇, ▇▇-▇▇, ▇-▇▇, proxy statements, annual reports, quarterly
reports, registration statements and any other filings or other communications
made by Holdings, the Borrower or any of their respective Subsidiaries to
holders of its publicly traded securities or the Securities and Exchange
Commission or any successor thereto (the "SEC") from time to time pursuant to
the Securities Exchange Act of 1934, as amended, or the Securities Act of 1933,
as amended;
(j) promptly and in any event within five Business Days after
becoming aware of the occurrence of any of the following events, the Borrower
will provide the Administrative Agent with notice of such event (and copies of
relevant documents if requested):
(i) any Material Contract of Holdings, the Borrower or any of
their respective Subsidiaries is terminated or amended or any new
Material Contract is entered into which is reasonably likely to have an
adverse effect on the Lenders (in which event the Borrower shall
provide the Administrative Agent with a copy of such Material
Contract); or
(ii) any of the material terms (other than price) upon which
material suppliers of the Borrower or any of its Subsidiaries do
business with the Borrower or such Subsidiary are changed or amended
the results of which are reasonably likely to have a Material Adverse
Effect; or
(iii) any order, judgment or decree in excess of $1,000,000 (after
reasonably expected insurance and indemnity recovery) shall have been
entered against Holdings, the Borrower or any of their respective
Subsidiaries or any of their respective properties or assets; or
(iv) any notification of violation of any Requirement of Law shall
have been received by Holdings, the Borrower or any of their respective
Subsidiaries from any Governmental Authority the results of which could
reasonably be expected to have a Material Adverse Effect;
(k) (A) within 60 days after the end of each fiscal year of
Holdings an update on a limited scope physical inspection basis (satisfactory to
the Administrative Agent) of the appraisal of the Credit Parties' Rental
Equipment delivered to the Administrative Agent in February 2002 performed by a
third party and on a valuation basis acceptable to the Administrative Agent and
(B) within 60 days after the end of each second fiscal quarter of each fiscal
year of the Borrower an update on a desk top basis of the most recently
delivered appraisal pursuant to preceding clause (A), PROVIDED that, (i) if a
Default or an Event of Default has occurred and is continuing, or (ii) (x) in
the event that the gross book value of Rental Equipment constituting storage
units is less than 10% of the gross book value of all Rental Equipment at the
time the respective certificate required by clause (f) above is required to be
delivered, (A) the average age of all Rental Equipment not constituting storage
units (taken as a whole) shall, at such time, have increased, or (B) the Average
Rental Rate for all Rental Equipment not constituting storage units shall, at
such time, have decreased and (y) in the event that the gross book value of
Rental Equipment constituting storage units is greater than or equal to 10% of
the gross book value of all Rental Equipment at such time, (i) the average age
of (1) all Rental Equipment constituting storage units (taken as a whole) or (2)
all Rental Equipment not constituting storage units (taken as a whole), shall,
at such time, have increased or (ii) the Average Rental Rate of (1) all Rental
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Equipment constituting storage units or (2) all Rental Equipment not
constituting storage equipment shall, at such time, have decreased, in the case
of any of clauses (x) or (y), more than 15% from levels reported in or as of the
last appraisal, the Administrative Agent shall be permitted to request an update
on a physical inspection basis at any time;
(l) at the request of the Administrative Agent (but, so long as no
Default or Event of Default has occurred and is continuing, in no event more
frequently than semi-annually), an update of the collateral examination report
delivered to the Lenders pursuant to Section 5.1(r) in form and substance
reasonably satisfactory to the Administrative Agent;
(m) ENVIRONMENTAL MATTERS. Promptly after any officer of Holdings
or the Borrower obtains knowledge thereof, notice of one or more of the
following environmental matters which could reasonably be expected to have a
Material Adverse Effect:
(i) any material pending or threatened Environmental Claim against
Holdings, the Borrower or any of their respective Subsidiaries or any
Real Property owned, leased or operated by the Borrower or any of their
respective Subsidiaries;
(ii) any condition or occurrence on or arising from any Real
Property owned, leased or operated by Holdings, the Borrower or any of
their respective Subsidiaries that (a) results in material
noncompliance by Holdings, the Borrower or any of their respective
Subsidiaries with any applicable Environmental Law or (b) could be
expected to form the basis of a material Environmental Claim against
Holdings, the Borrower or any of their respective Subsidiaries or any
such Real Property;
(iii) any condition or occurrence on any Real Property owned, leased
or operated by Holdings, the Borrower or any of their respective
Subsidiaries that could be expected to cause such Real Property to be
subject to any restrictions on the ownership, lease, occupancy, use or
transferability by Holdings, the Borrower or any of their respective
Subsidiaries of such Real Property under any Environmental Law; and
(iv) the taking of any material removal or remedial action in
response to the actual or alleged presence of any Hazardous Material on
any Real Property owned, leased or operated by Holdings, the Borrower
or any of their respective Subsidiaries as required by any
Environmental Law or any governmental, regulatory or other
administrative agency; PROVIDED, that in any event Holdings shall
deliver to each Lender all notices received by Holdings, the Borrower
or any of its Subsidiaries from any government or governmental,
regulatory or administrative agency under, or pursuant to, CERCLA which
identify Holdings, the Borrower or any of their respective Subsidiaries
as potentially responsible parties for remediation costs or which
otherwise notify Holdings, the Borrower or any of their respective
Subsidiaries of potential liability under CERCLA.
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All such notices shall describe in reasonable detail the nature of the
claim, investigation, condition, occurrence or removal or remedial action and
Holdings' or the Borrower's response thereto; and
(n) from time to time, such further information, including
customer address lists, regarding the Collateral, business affairs and financial
condition of Holdings, the Borrower and/or each of their respective Subsidiaries
as the Administrative Agent may reasonably request.
Notwithstanding anything to the contrary contained in clause (f) of
this Section 7.1, the information delivered to the Administrative Agent pursuant
to sub-clauses (C) and (D) of Section 7.1(f) shall only be delivered to those
Lenders which have requested same from the Administrative Agent in writing and
delivered a copy of such request to the Borrower.
7.2 REAL ESTATE APPRAISALS. In the event that the Administrative
Agent or the Required Lenders at any time after the Effective Date determine in
its or their good faith discretion (as a result of events or circumstances
affecting the Administrative Agent or the Required Lenders after the Effective
Date) that real estate appraisals satisfying the requirements set forth in 12
C.F.R., Part 34-Subpart C, or any successor or similar statute, rule,
regulation, guideline or order (any such appraisal a "REQUIRED APPRAISAL") are
or were required to be obtained, or should be obtained, in connection with any
Mortgaged Property or Mortgaged Properties, then, within 120 days after
receiving written notice thereof from the Administrative Agent or the Required
Lenders, as the case may be, such Required Appraisals shall be delivered, at the
expense of the Borrower, to the Administrative Agent, which Required Appraisals,
and the respective appraiser, shall be satisfactory to the Administrative Agent.
7.3 CORPORATE FRANCHISES. Holdings and the Borrower will, and will
cause each of their respective Subsidiaries to, do or cause to be done, all
things necessary to preserve and keep in full force and effect its existence,
material rights and authority to do business, provided that transactions
permitted by Section 8.1 will not constitute a breach of this Section 7.3, and
PROVIDED FURTHER that none of Holdings, the Borrower or any of their respective
Subsidiaries shall be required to preserve any material right or authority to do
business if such Person shall reasonably determine that such preservation is no
longer desirable in the ordinary course of business, and the loss thereof could
not reasonably be expected to have a Material Adverse Effect.
7.4 COMPLIANCE WITH STATUTES, ETC. (a) Holdings and the Borrower
will, and will cause each of their respective Subsidiaries to, comply with all
applicable statutes, regulations and orders of, and all applicable restrictions
imposed by, all governmental bodies, domestic or foreign, in respect of the
conduct of its business and the ownership of its property (including applicable
Environmental Laws) except to the extent non-compliance (individually or in the
aggregate) could not reasonably be expected to have a Material Adverse Effect.
None of Holdings, the Borrower or any of their respective Subsidiaries will
generate, use, treat, store, release or dispose of, or permit the generation,
use, treatment, storage, release or disposal of, Hazardous Materials on any of
its Real Property, or transport or permit the transportation of Hazardous
Materials to or from any such Real Property, except to the extent the failure to
comply with the foregoing requirements, either individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect. If required
to do so under any
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applicable Environmental Law, Holdings and the Borrower agree to undertake, and
agree to cause each of their respective Subsidiaries to undertake, any cleanup,
removal, remedial or other action necessary to remove and clean up any Hazardous
Materials from any Real Property in accordance with, in all material respects,
the requirements of all such applicable Environmental Laws and in accordance
with, in all material respects, all applicable orders and directives of all
governmental authorities; PROVIDED that none of Holdings, the Borrower or any of
their respective Subsidiaries shall be required to take any such action where
same is being contested by appropriate legal proceedings in good faith by
Holdings, the Borrower or such Subsidiary.
(b) At the request of the Administrative Agent or the Required
Lenders at any time and from time to time when an Event of Default has occurred
and is continuing, but in any event no more frequently than once a year with
respect to any particular parcel of Real Property, the Borrower will provide, at
the Borrower's sole cost and expense, an environmental site assessment report or
update concerning any Real Property of Holdings, the Borrower or any of their
respective Subsidiaries, prepared by an environmental consulting firm reasonably
acceptable to the Administrative Agent, indicating the presence or release of
Hazardous Materials and the potential cost of any removal or remedial action in
connection with any Hazardous Materials on such Real Property; PROVIDED,
HOWEVER, no such request may be made unless the Administrative Agent or the
Required Lenders reasonably believe that (i) Holdings, the Borrower or any of
their respective Subsidiaries is in material noncompliance with any
Environmental Law with respect to such Real Property and such noncompliance is
reasonably likely to result in a liability of the Borrower in excess of
$2,500,000 (after expected insurance and indemnity recovery) in the aggregate or
(ii) an Event of Default is in existence. If the Borrower fails to provide the
same after 60 days' written notice, the Administrative Agent may order the same,
and Holdings and/or the Borrower shall grant and hereby grants to the
Administrative Agent and the Lenders and their agents access to such Real
Property at all reasonable times and without unreasonably interfering with the
Borrower's operations and specifically grants the Administrative Agent and the
Lenders an irrevocable nonexclusive license, subject to the rights of tenants,
to undertake such an assessment all at the Borrower's sole expense.
7.5 ERISA. As soon as possible and, in any event, within twenty
days after Holdings, the Borrower, any of their respective Subsidiaries or any
ERISA Affiliate knows or has reason to know of the occurrence of any of the
following, Holdings will deliver to the Administrative Agent a certificate of
the chief financial officer of Holdings setting forth the full details as to
such occurrence and the action, if any, that Holdings, the Borrower, such
Subsidiary or such ERISA Affiliate is required or proposes to take, together
with any notices required or proposed to be given to or filed with or by
Holdings, the Borrower, the Subsidiary, the ERISA Affiliate, the PBGC, a Plan
participant or the Plan administrator with respect thereto: that a Reportable
Event has occurred (except to the extent that the Borrower has previously
delivered to the Lenders a certificate and notices (if any) concerning such
event pursuant to the next clause hereof); that a contributing sponsor (as
defined in Section 4001(a)(13) of ERISA) of a Plan subject to Title IV of ERISA
is subject to the advance reporting requirement of PBGC Regulation Section
4043.61 (without regard to subparagraph (b)(1) thereof), and an event described
in subsection .62, .63, .64, .65, .66, .67 or .68 of PBGC Regulation Section
4043 is reasonably expected to occur with respect to such Plan within the
following thirty days; that an accumulated funding deficiency, within the
meaning of Section 412 of the Code or Section 302
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of ERISA, has been incurred or an application may be or has been made for a
waiver or modification of the minimum funding standard (including any required
installment payments) or an extension of any amortization period under Section
412 of the Code or Section 303 or 304 of ERISA with respect to a Plan; that any
contribution required to be made with respect to a Plan or Foreign Pension Plan
has not been timely made; that a Plan has been or may be reasonably expected to
be terminated, reorganized, partitioned or declared insolvent under Title IV of
ERISA; that a Plan subject to Title IV of ERISA has an Unfunded Current
Liability which, when added to the aggregate amount of Unfunded Current
Liabilities with respect to all other Plans subject to Title IV of ERISA,
exceeds the aggregate amount of such Unfunded Current Liabilities that existed
on the Effective Date by $250,000; that proceedings may be or have been
instituted to terminate a Plan or appoint a trustee to administer a Plan which
is subject to Title IV of ERISA; that a proceeding has been instituted pursuant
to Section 515 of ERISA to collect a delinquent contribution to a Plan; that
Holdings, the Borrower, any of their respective Subsidiaries or any ERISA
Affiliate will or may be reasonably expected to incur any material liability
(including any indirect, contingent, or secondary liability) to or on account of
the termination of or withdrawal from a Plan under Section 4062, 4063, 4064,
4069, 4201, 4204 or 4212 of ERISA or with respect to a Plan under Section
401(a)(29), 4971, 4975 or 4980 of the Code or Section 409 or 502(i) or 502(l) of
ERISA or with respect to a group health plan (as defined in Section 607(1) of
ERISA or Section 4980B(g)(2) of the Code) under Section 4980B of the Code; or
that Holdings, the Borrower or any of their respective Subsidiaries may be
reasonably expected to incur any material liability pursuant to any employee
welfare benefit plan (as defined in Section 3(1) of ERISA) that provides
benefits to retired employees or other former employees (other than as required
by Section 601 of ERISA or any other applicable continuation of coverage laws or
regulations) or any Plan or any Foreign Pension Plan in addition to the
liability that existed on the Effective Date to any such plan or plans. The
Borrower will deliver to each of the Lenders (i) a complete copy of the annual
report (on Internal Revenue Service Form 5500-series) of each Plan (including,
to the extent required, the related financial and actuarial statements and
opinions and other supporting statements, certifications, schedules and
information) required to be filed with the Internal Revenue Service and (ii)
copies of any material records, documents or other information that must be
furnished to the PBGC with respect to any Plan pursuant to Section 4010 of
ERISA. In addition to any certificates or notices delivered to the Lenders
pursuant to the first sentence hereof, copies of annual reports and any records,
documents or other information required to be furnished to the PBGC, and any
material notices received by Holdings, the Borrower, any of their respective
Subsidiaries or any ERISA Affiliate with respect to any Plan or Foreign Pension
Plan shall be delivered to the Lenders no later than ten days after the date
such annual report has been filed with the Internal Revenue Service or such
records, documents and/or information has been furnished to the PBGC or such
notice has been received by Holdings, the Borrower, such Subsidiary or the ERISA
Affiliate, as applicable.
7.6 GOOD REPAIR. Each of Holdings and the Borrower will, and will
cause each of their respective Subsidiaries to, use its best efforts to provide
that its material properties and equipment used or useful in its business
(including Rental Equipment) in whomsoever's possession they may be, are kept in
good repair, working order and condition, normal wear and tear excepted and,
subject to Section 8.4, that from time to time there are made in such properties
and equipment all needful and proper repairs, renewals, replacements,
extensions, additions, betterments and improvements thereto.
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7.7 BOOKS AND RECORDS. Each of Holdings and the Borrower agree to
maintain, and to cause each of their respective Subsidiaries to maintain, books
and records pertaining to the Collateral in such detail, form and scope as is
consistent with good business practice, and agrees that such books and records
will reflect the Lenders' interest in its Accounts. Holdings and the Borrower
agree that the Collateral Agent or its agents may enter upon the premises of
Holdings, the Borrower or any of their respective Subsidiaries at any time and
from time to time, during normal business hours and upon reasonable notice under
the circumstances, and at any time at all upon the occurrence and during the
continuance of an Event of Default, for the purposes of (i) inspecting the
Collateral, (ii) inspecting and/or copying (at the Borrower's expense) any and
all records pertaining thereto, (iii) discussing the affairs, finances and
business of Holdings or the Borrower with any officers, employees and directors
of Holdings or the Borrower or with Auditors (it being understood that Holdings
or the Borrower shall be entitled to have a representative present at any such
discussions) and (iv) verifying Eligible Accounts Receivable and/or Eligible
Rental Equipment. The Borrower shall give the Collateral Agent fifteen days
prior written notice of any change in the location of any facility owned or
leased by Holdings or the Borrower or any of their respective Subsidiaries where
Collateral is located or in the location of its chief executive office or place
of business from the locations specified in Schedule VI, and to execute in
advance of such change, cause to be filed and/or delivered to the Collateral
Agent any financing statements, Collateral Access Agreements or other documents
required by the Administrative Agent, all in form and substance reasonably
satisfactory to the Administrative Agent. The Borrower agrees to advise the
Administrative Agent promptly, in sufficient detail, of any substantial change
relating to the type, quantity or quality of more than 10% (measured by net book
value) of the Collateral, or any event (other than a change in price) which
could have a material adverse effect on the value of more than 10% (measured by
net book value) of the Collateral or on the security interests granted to the
Collateral Agent, on behalf of the Lenders therein.
7.8 COLLATERAL RECORDS. Each of Holdings and the Borrower agree to
execute and deliver, and to cause each of their respective Subsidiaries to
execute and deliver, to the Collateral Agent, from time to time, solely for the
Collateral Agent's convenience in maintaining a record of the Collateral, such
written statements and schedules as the Collateral Agent may reasonably require,
including, without limitation, those described in Section 7.1 of this Credit
Agreement, designating, identifying or describing the Collateral pledged or
granted to the Lenders under the Collateral Documents. The failure by Holdings,
the Borrower or any of their respective Subsidiaries, however, to promptly give
the Collateral Agent such statements or schedules shall not affect, diminish,
modify or otherwise limit the Collateral Agent's security interests (for the
benefit of the Lenders) in the Collateral.
7.9 SECURITY INTERESTS. Each of Holdings and the Borrower shall,
and shall cause each of their respective Subsidiaries to, defend the Collateral
against all claims and demands of all Persons at any time claiming the same or
any interest therein other than claims or demands pursuant to the Credit
Documents. Subject to Section 11.19, Holdings and the Borrower shall comply, and
shall cause each of their respective Subsidiaries to comply, with the
requirements of all state and federal laws in order to grant to the Lenders
valid and perfected first priority security interests in the Collateral, subject
to Existing Liens and to any other Permitted Liens which pursuant to operation
of law are prior to the perfected security interests created under the
Collateral Documents. The Collateral Agent is hereby authorized by Holdings and
the Borrower
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to file any UCC financing statements covering the Collateral whether or not the
signatures of Holdings or the Borrower appears thereon.
7.10 INSURANCE; CASUALTY LOSS. Holdings and the Borrower agree to
maintain, and to cause each of their respective Subsidiaries to maintain, public
liability insurance, flood insurance, third party property damage insurance and
replacement value (or such higher coverage as Holdings may obtain) insurance on
the Collateral under such policies of insurance, with such insurance companies,
in such amounts and covering such risks in at least such amounts and against at
least such risks as are described on Schedule XII or, with respect to any lesser
coverages (whether as to the amount or scope of coverage), as are at all times
satisfactory to the Administrative Agent in its commercially reasonable
judgment. All policies covering the Collateral are to name the Collateral Agent
as an additional insured and the Collateral Agent as loss payee in case of loss,
as its interests may appear, and are to contain such other provisions as the
Administrative Agent may reasonably require to fully protect the Administrative
Agent's and the Lenders' interest in the Collateral and to any payments to be
made under such policies. The Borrower shall provide written notice to the
Administrative Agent of the occurrence of any of the following events within ten
Business Days after the occurrence of such event: any Collateral is (i) damaged
or destroyed, or suffers any other loss, or (ii) condemned, confiscated or
otherwise taken, in whole or in part, or the use thereof is otherwise diminished
so as to render impracticable or unreasonable the use of such Collateral or to
materially diminish its marketability (collectively, a "CASUALTY LOSS"), and in
either case either (x) a Default or an Event of Default has occurred and is
continuing or (y) the amount of the damage, destruction, loss or diminution in
value is in excess of $2,000,000. With respect to each Casualty Loss, the
Borrower may, in its sole discretion, either apply such amounts (x) to the
payment of the outstanding Term Loans in accordance with the requirements of
Section 2.5(g)(iii) or (y) to repair or replace the assets subject to the
Casualty Loss or to purchase other assets of the same or similar type as those
for which the Borrower received such insurance proceeds (although in the event
that a Default or an Event of Default then exists, such amount shall be applied
to repay outstanding Term Loans in accordance with Section 2.5(l) and, if
required in accordance with the terms thereof, to reduce the Total Revolving
Credit Commitments in accordance with Section 2.5(e)(iv)). Holdings, the
Borrower and/or the respective Subsidiary shall diligently file and prosecute
their claim or claims for any award or payment in connection with a Casualty
Loss. In the event of a Casualty Loss, if a Default or Event of Default has
occurred and is continuing, Holdings shall pay to the Collateral Agent, promptly
upon receipt thereof, any and all net insurance proceeds and payments received
by Holdings, the Borrower or any of their respective Subsidiaries on account of
damage, destruction, loss, condemnation or eminent domain proceedings, which
proceeds shall be applied as provided in the last parenthetical of the preceding
sentence or as otherwise determined by the Required Lenders in their sole
discretion). After the occurrence and during the continuance of an Event of
Default, (i) no settlement on account of any such Casualty Loss shall be made
without the consent of the Collateral Agent and (ii) the Collateral Agent may
participate in any such proceedings and the Borrower shall deliver to the
Collateral Agent such documents as may be requested by the Collateral Agent to
permit such participation and shall consult with the Collateral Agent, its
attorneys and agents in the making and prosecution of such claim or claims. Each
of Holdings and the Borrower hereby irrevocably authorizes and appoints the
Collateral Agent its attorney-in-fact, after the occurrence and during the
continuance of an Event of Default, to collect and receive for any such award or
payment and to file and prosecute such claim or claims, which power of attorney
shall be
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irrevocable and shall be deemed to be coupled with an interest, and each of
Holdings and the Borrower shall, upon demand of the Collateral Agent, make,
execute and deliver any and all assignments and other instruments sufficient for
the purpose of assigning any such award or payment to the Collateral Agent for
the benefit of the Lenders, free and clear of any encumbrances of any kind or
nature whatsoever, other than the right of Holdings or the Borrower to any
insurance proceeds remaining after application thereof by the Collateral Agent
as provided in this Section 7.10.
7.11 TAXES. Each of Holdings and the Borrower will, and will cause
each of their respective Subsidiaries to, pay and discharge all federal income
and other material taxes, assessments and governmental charges or levies imposed
upon it or upon its income or profits, or upon any properties belonging to it,
or payable by it pursuant to the Tax Sharing Agreements, in each case on a
timely basis, and all lawful claims which, if unpaid, might become a Lien or
charge upon any properties of Holdings, the Borrower or of any of their
respective Subsidiaries; PROVIDED, that none of Holdings, the Borrower or any of
their respective Subsidiaries shall be required to pay any such tax, assessment,
charge, levy or claim which is being contested in good faith and by proper
proceedings if it has maintained adequate reserves (in the good faith judgment
of the management of such Person) with respect thereto in accordance with GAAP.
7.12 END OF FISCAL YEARS; FISCAL QUARTERS. Each of Holdings and the
Borrower will, for financial reporting purposes, cause (i) each of their, and
each of their respective Subsidiaries', fiscal years to end on December 31 of
each year and (ii) each of their and each of their respective Subsidiaries',
fiscal quarters to end on dates consistent therewith.
7.13 FURTHER ASSURANCES. (a) Holdings and the Borrower shall take,
and shall cause each of their respective Subsidiaries to take, all such further
actions and execute all such further documents and instruments as the Collateral
Agent may at any time reasonably determine to be necessary or desirable to
further carry out and consummate the transactions contemplated by the Credit
Documents, to cause the execution, delivery and performance of the Credit
Documents to be duly authorized and to perfect or protect the Liens (and the
priority status thereof) of the Collateral Agent on the Collateral including,
without limitation, (i) filing notices of liens, UCC financing statements and
amendments, renewals and continuations thereof, (ii) obtaining, providing or
making notations of security interests upon Unit Certificates, (iii) cooperating
with the Collateral Agent's representatives, keeping stock records, obtaining
waivers from landlords and from warehousemen and their landlords and (iv) paying
claims which might, if unpaid, become a Lien on the Collateral other than a
Permitted Lien. Furthermore, Holdings and the Borrower shall cause to be
delivered to the Collateral Agent such opinions of counsel, title insurance and
other related documents as may be reasonably requested by the Collateral Agent
to assure itself that this Section 7.13 has been complied with. Notwithstanding
anything to the contrary contained in this Section 7.13, the Collateral Agent
shall not (except in the circumstances described in the second and third
sentences of Section 11.19) request that the Borrower obtain or provide any Unit
Certificates with respect to any Non-Qualified Units unless an Event of Default
has occurred and is continuing; PROVIDED that if any Unit Certificates are
obtained, a notation of the Collateral Agent's security interest shall be made
thereon as required by Section 7.18(b). All actions required to be taken
pursuant to this Section 7.13, as well as pursuant to Section 11.19, shall be at
the cost and expense of the Borrower.
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(b) Within 90 days following the acquisition of any Real Property
owned by the Borrower or any Subsidiary Guarantor, having a fair market value
equal to or greater than $1,000,000, the Borrower will, or cause the respective
Subsidiary Guarantor to, grant to the Collateral Agent for the benefit of the
Secured Creditors, a Mortgage on any such Real Property. Each such Mortgage
shall be granted pursuant to documentation substantially similar to the
Mortgages executed on the date hereof (with such modifications as may be
appropriate in consideration of the State in which such Real Property is
located) and shall constitute a valid and enforceable perfected mortgage Lien on
the respective Real Property superior to and prior to the rights of all third
Persons and subject to no other Liens except for Permitted Encumbrances. Each
such Mortgage and all instruments related thereto shall have been duly recorded
or filed in such manner and in such places as are required by law to establish,
perfect, preserve and protect the Liens in favor of the Collateral Agent
required to be granted pursuant to such Mortgages and all taxes, fees and other
changes payable in connection therewith shall have been paid in full. In
connection with the delivery of any such Mortgage pursuant to the preceding
sentence, the Borrower shall deliver, or cause to be delivered (in each case
within the above-mentioned 90 day period), (i) a Mortgage Policy on the Mortgage
on such Real Property issued by a title insurance company reasonably
satisfactory to the Collateral Agent and assuring the Collateral Agent that such
Mortgage is a valid and enforceable first priority mortgage lien on such Real
Property free and clear of all defects and encumbrances except Permitted
Encumbrances, and such Mortgage Policy shall otherwise be in form and substance
reasonably satisfactory to the Collateral Agent and shall include, as
appropriate, an endorsement for future advances under this Credit Agreement and
the Notes and for any other matter that the Collateral Agent in its discretion
may reasonably request, shall not include an exception for mechanics' liens, and
shall provide for affirmative insurance and such reinsurance as the Collateral
Agent in its discretion may reasonably request; (ii) a survey of such Real
Property, in form and substance reasonably satisfactory to the Collateral Agent,
certified by a licensed professional surveyor reasonably satisfactory to the
Collateral Agent and of a date reasonably acceptable to the Collateral Agent,
and (iii) opinions of counsel from counsel, and in form and substance,
reasonable satisfactory to the Administrative Agent.
7.14 MAINTENANCE OF SEPARATENESS. Each Credit Party will, and will
cause each of its Subsidiaries to, satisfy customary corporate and
organizational formalities, including the holding of regular board of directors'
and shareholders' meetings or action by directors or shareholders without a
meeting and the maintenance of corporate offices and records. The Credit Parties
shall take all actions as may be required to maintain an executive committee for
the Unit Subsidiary with at least one member that is not and, during the
one-year period immediately preceding the time of initial appointment of such
member to such executive committee, was not an employee, officer, director,
shareholder, or partner of the Borrower or any of its Affiliates. In dealing
with their respective creditors, none of Holdings, the Borrower or any of their
respective Subsidiaries shall act in a manner which would cause its creditors to
believe that any such Person was not a separate corporate entity from the other
such Persons. Without limiting the foregoing, the consolidated financial
statements of each of Holdings and the Borrower shall, through appropriate
footnote disclosure, indicate the assets from time to time held by the Unit
Subsidiary, as opposed to Holdings or the Borrower, as the case may be, and
their other Subsidiaries. Finally, from and after the Effective Date, no Credit
Party nor any of its Subsidiaries shall take any action, or conduct its affairs
in a manner, which would be reasonably likely to result in the separate
existence of the Unit Subsidiary being ignored, or in the assets and
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liabilities of the Unit Subsidiary being substantively consolidated with those
of any of Holdings, the Borrower or any of their respective Subsidiaries (other
than the Unit Subsidiary) in a bankruptcy, reorganization or other insolvency
proceeding.
7.15 COLLATERAL ACCESS AGREEMENTS. The Borrower shall exercise
reasonable good faith efforts to obtain and deliver to the Administrative Agent,
such Collateral Access Agreements with respect to Rental Equipment locations for
which no Collateral Access Agreement was delivered to the Administrative Agent
on the Initial Borrowing Date and shall exercise reasonable good faith efforts
to obtain and deliver such other Collateral Access Agreements as may be
requested by the Administrative Agent from time to time (such Collateral Access
Agreements to be so delivered to the Administrative Agent promptly upon request
and in any event, within 60 days after the respective request has been made);
PROVIDED that, notwithstanding the foregoing, the Borrower, in obtaining the
Collateral Access Agreements required under this Section 7.15, shall not be
obligated to make significant payments to landlords or alter the respective
lease terms with respect to any Rental Equipment locations in any way which is
materially adverse to the Borrower.
7.16 NEW SUBSIDIARIES. To the extent Holdings or any of its
Subsidiaries creates or acquires any Wholly-Owned Domestic Subsidiary or
Wholly-Owned Canadian Subsidiary after the Initial Borrowing Date in accordance
with the other provisions of this Credit Agreement, each such Wholly-Owned
Subsidiary shall be required (i) in the case of any such Wholly-Owned Domestic
Subsidiary, to become a party to the U.S. Subsidiaries Guaranty, the U.S. Pledge
Agreement and the U.S. Security Agreement, in any such case by executing
counterparts of the U.S. Subsidiary Joinder Agreement in the form of Exhibit N
and taking the actions specified therein, and (ii) in the case of any such
Wholly-Owned Canadian Subsidiary, to execute and deliver a Canadian Subsidiaries
Guaranty and a Canadian Security Agreement. In connection with the foregoing, to
the extent requested by the Administrative Agent and the Collateral Agent, the
Borrower shall be required to cause to be delivered such relevant documentation
(including opinions of counsel) of the type described in Section 5.1 as the
respective Subsidiary would have delivered if it were a Credit Party on the
Initial Borrowing Date.
7.17 PERMITTED ACQUISITIONS. (a) Subject to the provisions of this
Section 7.17 and the requirements contained in the definition of Permitted
Acquisition, the Borrower and its Subsidiaries (other than the Unit Subsidiary)
may from time to time after the Initial Borrowing Date effect Permitted
Acquisitions, so long as (in each case except to the extent the Required Lenders
otherwise specifically agree in writing in the case of a specific Permitted
Acquisition): (i) no Default or Event of Default shall be in existence at the
time of the consummation of the proposed Permitted Acquisition or immediately
after giving effect thereto; (ii) the Borrower shall have given the
Administrative Agent at least 10 Business Days' prior written notice of any
Permitted Acquisition; (iii) calculations are made by the Borrower of compliance
with the covenants contained in Sections 8.9, 8.10 and 8.11 for the period of
four consecutive fiscal quarters (taken as one accounting period) most recently
ended prior to the date of such Permitted Acquisition (each, a "CALCULATION
PERIOD"), on a PRO FORMA basis as if the respective Permitted Acquisition (as
well as all other Permitted Acquisitions theretofor consummated after the first
day of such Calculation Period) had occurred on the first day of such
Calculation Period, and such recalculations shall show that such financial
covenants would have been complied with if
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the Permitted Acquisition had occurred on the first day of such Calculation
Period (for this purpose, if the first day of the respective Calculation Period
occurs prior to the Effective Date, calculated as if the covenants contained in
said Sections 8.9, 8.10 and 8.11 had been applicable from the first day of the
Calculation Period); (iv) the Borrower shall certify, and the Administrative
Agent shall have been satisfied in its reasonable discretion that, to the best
of the Borrower's knowledge, the proposed Permitted Acquisition could not
reasonably be expected to result in materially increased tax, ERISA,
environmental or other contingent liabilities with respect to Holdings, the
Borrower or any of their respective Subsidiaries; (v) all representations and
warranties contained herein and in the other Credit Documents shall be true and
correct in all material respects with the same effect as though such
representations and warranties had been made on and as of the date of such
Permitted Acquisition (both before and after giving effect thereto), unless
stated to relate to a specific earlier date, in which case such representations
and warranties shall be true and correct in all material respects as of such
earlier date; (vi) the Borrower provides to the Administrative Agent and the
Lenders as soon as available but not later than five Business Days after the
execution thereof, a copy of any executed purchase agreement or similar
agreement with respect to such Permitted Acquisition; (vii) the aggregate amount
invested in all such Permitted Acquisitions occurring on or after the Effective
Date (when added, without duplication, to the aggregate amount invested pursuant
to Section 8.5(q) after the Effective Date) shall not exceed $75,000,000
(although no more than $40,000,000 in the aggregate may be invested (whether
pursuant to this Section 7.17 or Section 8.5(q) and, in the case of any
investment in a Person which has both U.S. and non-U.S. assets or Subsidiaries,
allocating the amount invested as reasonably determined by the Borrower in good
faith) in Permitted Acquisitions of Persons which are organized, and/or assets
which are located, outside the United States and Canada); (viii) after giving
effect to such Permitted Acquisition and any Credit Event in connection
therewith, the Borrower may incur $50,000,000 (or $75,000,000 if Lenders and/or
other Persons (as contemplated in Section 2.1(d)) have provided Incremental
Commitments of $30,000,000 pursuant to such Section 2.1) or more of additional
Revolving Outstandings in compliance with the Total Revolving Credit Commitments
and the Borrowing Base restrictions then in effect and (ix) Holdings shall have
delivered to the Administrative Agent an officer's certificate executed by the
chief executive officer or chief financial officer of Holdings, certifying to
the best of his knowledge, compliance with the requirements of preceding clauses
(i) through (v), inclusive, (vii) and (viii) containing the calculations
required by the preceding clauses (iii), (vii) and (viii).
(b) At the time of each Permitted Acquisition (x) involving the
creation or acquisition of a Subsidiary, or the acquisition of capital stock or
other equity interest of any Person (in each case by a Credit Party, or a Person
that is required to be a Credit Party pursuant to this Credit Agreement), all
capital stock or other equity interests thereof created or acquired in
connection with such Permitted Acquisition shall be pledged to the Collateral
Agent for the benefit of the Secured Creditors pursuant to the respective Pledge
Agreement (although in the case of an acquisition of any Subsidiary or Person
which, after giving effect thereto, becomes a Non-Canadian Foreign Subsidiary,
if the granting of a pledge of more than 66-2/3% of the voting capital stock or
voting equity interests of such Non-Canadian Foreign Subsidiary would give rise
to "deemed dividend" tax consequences under Section 956 of the Code, then not
more than 65% of the outstanding voting capital stock or equity interests (plus
100% of the non-voting capital stock or equity interests) shall be required to
be pledged to the Collateral Agent pursuant to the relevant Pledge Agreement)
and/or (y) involving the acquisition of any Units, whether directly or
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by the acquisition of a Subsidiary which owns such Units (but not in the event
such Units are acquired by, or such acquired Subsidiary constitutes, a
Non-Canadian Foreign Subsidiary), the provisions of Section 7.18 shall be
complied with at the time of the consummation of the respective Permitted
Acquisition.
(c) The Borrower shall cause each Subsidiary (other than a
Non-Canadian Foreign Subsidiary) which is formed to effect, or is acquired
pursuant to, a Permitted Acquisition to comply with, and to execute and deliver,
all of the documentation required by, Section 7.16, to the satisfaction of the
Administrative Agent.
7.18 UNIT SUBSIDIARY; PROVISIONS RELATING TO UNITS; ETC. (a)
Holdings and the Borrower shall at all times cause the Unit Subsidiary to be a
Wholly-Owned Domestic Subsidiary of the Borrower. Each of Holdings and the
Borrower shall take all action so that all Non-Qualified Units at any time owned
or acquired by Holdings, the Borrower or any of their respective Domestic
Subsidiaries (other than the Unit Subsidiary), or which are owned or acquired by
any Subsidiary of Holdings (other than the Unit Subsidiary) and are located in
the United States of America or any State or territories thereof, are (or have
been) on or prior to the Effective Date (or, if acquired thereafter, within five
Business Days after the end of the month in which such acquisition occurred)
contributed as a capital contribution to the equity of the Unit Subsidiary. As a
result of the requirements of the immediately preceding sentence, all
Non-Qualified Units at any time held by Holdings or the Borrower and their
respective Subsidiaries (other than Units located outside the United States of
America and the States and territories thereof which are owned by Foreign
Subsidiaries), shall be transferred to the Unit Subsidiary, which shall be the
exclusive owner thereof.
(b) With respect to all Certificated Units at any time acquired by
Holdings, the Borrower or any of their Subsidiaries after the date hereof,
Holdings and the Borrower shall take, or cause to be taken, all action as is
necessary so that, in any event within 30 days after any such acquisition of
Certificated Units the security interest of the Collateral Agent therein is
noted on the certificate of title issued with respect to the respective Unit.
7.19 USE OF PROCEEDS. The Borrower will use the proceeds of the
Loans only as provided in Section 6.5.
7.20 RENTAL EQUIPMENT; BUSINESS OF THE CREDIT PARTIES. (a) All
Rental Equipment owned by the U.S. Credit Parties shall at all times be held for
sale or lease by the respective U.S. Credit Party that owns such Rental
Equipment and such U.S. Credit Party shall at all times be in the business of
selling goods of that kind.
(b) All Rental Equipment owned by the Canadian Subsidiary
Guarantors shall at all times (i) be held for sale or lease, or shall have been
leased, by the respective Canadian Subsidiary Guarantor that owns such Rental
Equipment or (ii) be furnished (or held to be furnished) under a contract of
service.
7.21 OWNERSHIP OF RENTAL EQUIPMENT. All Rental Equipment (x)
located in the United States or any State thereof shall at all times be owned by
the Borrower or a U.S. Subsidiary Guarantor organized under the laws of a State
of the United States and (y) all Rental
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Equipment located in Canada shall at all times be owned by a Canadian Subsidiary
Guarantor organized under the laws of a Qualified Canadian Jurisdiction.
7.22 NO PERMITTED UNITS FINANCING OR ATTRIBUTABLE DEBT. Holdings
and the Borrower will not, and will not permit any of their respective
Subsidiaries to, incur or have outstanding any Indebtedness of the type
described in Section 6.30.
ARTICLE 8
NEGATIVE COVENANTS
------------------
Subject to Section 11.19, each of Holdings and the Borrower hereby
covenants and agrees that as of the Effective Date, and thereafter, for so long
as this Credit Agreement is in effect and until the Total Commitments have
terminated, no Letter of Credit or Notes are outstanding and the Loans and
Letter of Credit Obligations, together with interest, Fees, Expenses and all
other Obligations then due and payable are paid in full:
8.1 CONSOLIDATION, MERGER, SALE OR PURCHASE OF ASSETS, ETC.
Holdings and the Borrower will not, and will not permit any of their respective
Subsidiaries to, wind up, liquidate or dissolve its affairs, or enter into any
transaction of merger or consolidation, sell or otherwise dispose of all or any
part of its property or assets, or enter into any sale-leaseback transactions,
or purchase, lease or otherwise acquire (in one transaction or a series of
related transactions) all or any part of the property or assets of any Person or
agree to do any of the foregoing at any future time, except that the following
shall be permitted:
(a) (i) Capital Expenditures made by the Borrower and its Domestic
Subsidiaries and Canadian Subsidiaries (including the purchase of assets in the
form of additional Rental Equipment) to the extent within the limitations set
forth in Section 8.4 and (ii) Capital Expenditures made by the Borrower's
Non-Canadian Foreign Subsidiaries;
(b) the investments, acquisitions and transfers or dispositions of
properties permitted pursuant to Section 8.5 and Dividends permitted pursuant to
Section 8.6;
(c) (i) any Domestic Subsidiary of the Borrower (excluding the
Unit Subsidiary) may be merged or consolidated with or into, or be liquidated
into, the Borrower or any Wholly-Owned Domestic Subsidiary of the Borrower (so
long as the Borrower or such Wholly-Owned Domestic Subsidiary of the Borrower is
the surviving corporation), or all or any part of the business, properties and
assets of any Domestic Subsidiary (excluding the Unit Subsidiary) may be
conveyed, leased, sold or transferred to the Borrower or any Wholly-Owned
Domestic Subsidiary of the Borrower, (ii) any Canadian Subsidiary may be merged
or consolidated with or into, or be liquidated into, any Wholly-Owned Canadian
Subsidiary (so long as such Wholly-Owned Canadian Subsidiary is the surviving
corporation), or all or any part of the business, properties and assets of any
Canadian Subsidiary may be conveyed, leased, sold or transferred to any
Wholly-Owned Canadian Subsidiary or to the Borrower, (iii) any Non-Canadian
Foreign Subsidiary may be merged or consolidated with or into, or be liquidated
into, any Non-Canadian Foreign Subsidiary that is a Wholly-Owned Subsidiary (so
long as such Wholly-Owned Subsidiary is the surviving corporation), or all or
any part of the business,
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properties and assets of any Non-Canadian Foreign Subsidiary may be conveyed,
leased, sold or transferred to any Non-Canadian Foreign Subsidiary that is a
Wholly-Owned Subsidiary and (iv) all or any part of the business, property and
assets of any Foreign Subsidiary may be transferred (by way of Dividend) to the
Borrower;
(d) the sale, lease or disposal to third parties (not Holdings or
any Subsidiary thereof) in the ordinary course of business of Inventory and
Rental Equipment and the purchase, lease or other acquisition from third parties
(not Holdings or any Subsidiary thereof) of equipment, Inventory and Rental
Equipment in the ordinary course of business;
(e) the sale or other disposition to third parties (not Holdings
or any Subsidiary thereof) of obsolete or excess equipment in the ordinary
course of business;
(f) operating leases (and other leases or subleases) of property
entered into or terminated in the ordinary course of business; PROVIDED that to
the extent that any such lease or sublease, as the case may be, constitutes a
Capital Lease, such lease or sublease, as the case may be, shall be permitted to
be entered into under this Section 8.1(f) only if also permitted to be entered
into under Section 8.3(b);
(g) sales and leases to the Borrower of Non-Qualified Units from
time to time held by the Unit Subsidiary pursuant to the Master Lease
Agreements, PROVIDED that in the case of any such sale the respective
Non-Qualified Units are contemporaneously sold to a third party as provided in
Section 8.1(d);
(h) the sale or return of automobiles and trucks which the
Borrower and its Subsidiaries customarily replace periodically with substitute
automobiles and trucks in the ordinary course of business;
(i) the Borrower or any Subsidiary may, in the ordinary course of
business, enter into licensing agreements with Persons for the use of
intellectual property or other intangible assets, and settlements, permissions,
consents to use, and similar arrangements concerning intellectual property or
other intangible assets, provided that in the case of any such agreements,
settlements, permissions, consents and similar arrangements to which any Credit
Party is a party, such Credit Party uses reasonable commercial efforts to
procure that each such license or other agreements is permitted to be assigned
pursuant to the respective Security Agreement to which such Credit Party is a
party and does not otherwise prohibit the granting of Lien therein by the
respective Credit Party pursuant to such Security Agreement; PROVIDED, FURTHER,
that notwithstanding anything to the contrary contained in this Section 8.1, the
Borrower shall be permitted to license trade names and related intellectual
property pursuant to the Trade Name License Agreement;
(j) the abandonment or other disposition of intellectual property
and other property that is, in the reasonable judgment of the Person owning such
intellectual property and other property, no longer economically practicable to
maintain or useful in the conduct of the business of such Person;
(k) the sale of (i) approximately 7 acres located at ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, (▇▇) approximately 7 acres located at ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇,
-▇▇▇-
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ and (iii) approximately 6.5 acres located at ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇;
(l) in connection with the sale of any Rental Equipment to a third
party as permitted by clause (d) above, the sale of Leases and conditional sales
contracts relating to such Rental Equipment, in each case, in the ordinary
course of business for fair market value to third parties; PROVIDED that in no
event is any such sale with any recourse to the seller of such leases and/or
conditional sales contracts except for (i) usual and customary warranties in
connection with the sale of the respective Rental Equipment or (ii) guaranties
the residual value of such Leases so long as the amount of guarantees of the
type described above in this clause (ii) (calculated taking the maximum
potential liability thereunder) at no time outstanding exceeds $5,000,000 in the
aggregate;
(m) any Permitted Acquisitions (so long as the applicable
requirements set forth in the definition of "Permitted Acquisitions" and in
Section 7.17 are satisfied);
(n) sales or other dispositions of assets to third parties (not
Holdings or any Subsidiary thereof), in addition to the sales or dispositions
permitted by the foregoing clauses (a) through (n), for fair market value not to
exceed $3,000,000 in a fiscal year of Holdings or $15,000,000 in the aggregate
since the Effective Date; PROVIDED, HOWEVER, that the Net Sale Proceeds
therefrom are applied to the repayment of outstanding Loans to the extent
required by Section 2.5(j);
(o) the Credit Agreement Parties may enter into agreements to
effect transactions which would result in a Change of Control on the terms and
conditions set forth on Schedule XIII; and
(p) the Borrower and its Subsidiaries may make the following sales
and dispositions of Rental Equipment if in the ordinary course of business: (i)
if any Rental Equipment is being moved in the ordinary course of business from
the United States of America or a State thereof to Canada or a Qualified
Canadian Jurisdiction (for use in said jurisdiction), the Borrower or the
respective Qualified Credit Party which owns such Rental Equipment may sell or
transfer the respective Rental Equipment to a Canadian Subsidiary Guarantor,
(ii) if any Rental Equipment is being moved in the ordinary course of business
from Canada or a province thereof to the United States of America or a State
thereof, the respective Canadian Subsidiary which owns such Rental Equipment may
sell or transfer the respective Rental Equipment to the Borrower (which shall
transfer same to the Unit Subsidiary if, and to the extent, required by Section
7.18) or the Unit Subsidiary and (iii) Non-Canadian Foreign Subsidiaries may
sell or transfer assets to any other Non-Canadian Foreign Subsidiary which is a
Wholly-Owned Subsidiary.
Notwithstanding anything to the contrary contained above, (x) in no event shall
Holdings or the Borrower sell or otherwise dispose, or permit any of their
respective Subsidiaries to sell or otherwise dispose, of any of their interests
in any Subsidiary except as expressly permitted pursuant to preceding Sections
8.1(c), (y) in no event shall the Unit Subsidiary be merged with or into or
consolidated with or into any other Person or be liquidated and (z) in no event
shall the Unit Subsidiary transfer any Non-Qualified Units or any interest
therein (except for the sale or
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lease thereof pursuant to the Master Lease Agreements, PROVIDED that in the case
of any such sale the respective Non-Qualified Units are contemporaneously sold
to a third party pursuant to Section 8.1(d)) to Holdings, the Borrower or any of
their other Subsidiaries or any other Person. To the extent the Required Lenders
waive the provisions of this Section 8.1 with respect to the sale of any
Collateral, or any Collateral is sold as permitted by this Section 8.1, such
Collateral in each case (so long as the Collateral is not being transferred to
Holdings, the Borrower or any of their respective Subsidiaries) shall be sold
free and clear of the Liens in favor of the Collateral Agent and the Lenders
created by the Collateral Documents and the Collateral Agent shall take such
actions as it deems appropriate in connection therewith or may be reasonably
requested by the Borrower to evidence such Lien release, in each case at the
Borrower's expense.
8.2 LIENS. Holdings and the Borrower will not, and will not permit
any of their respective Subsidiaries to, create, incur, assume or suffer to
exist any Lien upon or with respect to (i) the capital stock of the Borrower or
any of its Subsidiaries or (ii) any property or assets of any kind (real or
personal, tangible or intangible) of Holdings, the Borrower or any of their
respective Subsidiaries, whether now owned or hereafter acquired, or sell any
such property or assets subject to an understanding or agreement, contingent or
otherwise, to repurchase such property or assets (including sales of accounts
receivable or notes with recourse to Holdings, the Borrower or any of their
respective Subsidiaries, but excluding sales of Leases and conditional sales
contracts relating to Rental Equipment, in either case with residual guarantees
to the extent permitted under Section 8.1(l)) or assign any right to receive
income, or file or permit the filing of any financing statement under the UCC or
any other similar notice of Lien under any similar recording or notice statute
(other than precautionary filings covering leases of equipment), except Liens,
sales and assignments described below (herein referred to as "PERMITTED LIENS"):
(a) Liens for taxes, assessments or other governmental charges or
statutory obligations that are not delinquent or remain payable without penalty
or that are not yet due and payable or Liens for taxes being contested in good
faith and by appropriate proceedings for which adequate reserves (in the good
faith judgment of the management of the Borrower) have been established;
(b) Liens in respect of property or assets of the Borrower or any
of its Subsidiaries imposed by law or which were incurred in the ordinary course
of business, such as carriers', warehousemen's and mechanics' Liens, statutory
landlord's Liens, Liens in favor of customs and revenue authorities to secure
payment of customs duties in connection with the importation of goods, and other
similar Liens arising in the ordinary course of business, and (x) which, if any
such property or asset is material, do not in the aggregate materially detract
from the value of such property or assets or materially impair the use thereof
in the operation of the business of the Borrower or such Subsidiary or (y) which
are being contested in good faith by appropriate proceedings, which proceedings
have the effect of preventing the forfeiture or sale of the property or asset
subject to such Lien;
(c) Liens created by or pursuant to this Credit Agreement or the
other Credit Documents;
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(d) Liens existing on the Effective Date and listed on Schedule
XIV hereto and renewals and extensions thereof so long as the principal amount
of the Indebtedness secured thereby is not increased and no additional assets
are encumbered thereby ("EXISTING Liens");
(e) Liens (other than any Lien imposed by ERISA) incurred or
deposits made in the ordinary course of business (x) in connection with
liability insurance, workers' compensation, unemployment insurance and other
types of social security, or (y) to secure the performance of tenders, statutory
obligations, surety and appeal bonds, bids, leases, government contracts,
performance and return-of-money bonds and other similar obligations incurred in
the ordinary course of business (exclusive of obligations (i) in respect of
borrowed money or (ii) in respect of which a Letter of Credit has been issued),
provided that the aggregate amount (in the case of this clause (y)) does not
exceed $5,000,000;
(f) leases or subleases granted to third Persons not interfering
with the ordinary course of business of the Borrower or any of its Subsidiaries;
(g) Capital Leases to the extent permitted under Section 8.3(b);
(h) Liens (x) arising pursuant to purchase money mortgages
securing Indebtedness representing the purchase price (or financing of the
purchase price within 180 days after the respective purchase) of property or
other assets acquired by the Borrower or any Subsidiary, and any extensions,
renewals or replacements of such Liens, PROVIDED that (i) any such Liens attach
only to the assets so purchased, (ii) the Indebtedness secured by any such Lien
does not exceed 100% of the purchase price of the assets being purchased and
(iii) the Indebtedness secured thereby or any refinancing thereof is permitted
by Section 8.3(b); or (y) existing on specific tangible assets at the time
acquired by the Borrower or any Subsidiary or on assets of a Person at the time
such Person first becomes a Subsidiary or was merged into the Borrower or any
Subsidiary; PROVIDED that (i) any such Liens were not created at the time of or
in contemplation of the acquisition of such assets or Person by the Borrower or
such Subsidiary, (ii) in the case of any such acquisition of a Person, any such
Lien attaches only to specific tangible assets of such Person and not assets of
such Person generally and (iii) the Indebtedness secured thereby or any
refinancing thereof is permitted by Section 8.3(b);
(i) easements, rights-of-way, restrictions and other similar
charges or encumbrances not interfering in any material respect with the
business of the Borrower and its Subsidiaries;
(j) Liens created under ERISA and under Environmental Laws that
are being contested in good faith and as to which adequate reserves have been
established to the extent required by GAAP and secure obligations not in excess
of $2,500,000 in the aggregate;
(k) Permitted Encumbrances;
(l) any attachment or judgment Lien securing assets with a value
less than $1,000,000 not constituting an Event of Default under Section 9.1(h)
that is being contested in good faith by appropriate proceedings and for which
adequate reserves have been established in accordance with GAAP;
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(m) the leasehold interests of customers in Rental Equipment, in
each case to the extent the respective lease is entered into by the Borrower or
its respective Subsidiary in the ordinary course of its business and is not
pursuant to a sale-leaseback or similar financing transaction;
(n) Liens on the assets of Non-Canadian Foreign Subsidiaries
securing Indebtedness outstanding under Section 8.3(i);
(o) Liens granted by Holdings and/or the Borrower to secure the
performance of, and reimbursement obligations with respect to, bid, performance,
payment, surety, indemnity, or other similar bonds arising in the ordinary
course of business (collectively, "SURETY BONDS") and in favor of the provider
of any such Surety Bond (any such provider, a "SURETY"), so long as the
obligations so secured are outstanding under (and do not exceed the basket
amount contained in) Section 8.3(f); PROVIDED, that (i) such Liens shall extend
only to (A) the assets, interests and other property described in Schedule XV
and (ii) nothing herein shall permit Holdings, the Borrower or any of its
Subsidiaries to deposit funds due or to become due under any contract for which
any Surety has issued a Surety Bond into any account over which the Borrower (or
the Collateral Agent) does not have unilateral control or into any trust account
for the benefit of any Surety and any such action by Holdings, the Borrower or
any of its Subsidiaries shall be deemed to be an immediate Event of Default; and
(p) Liens other than those described in the preceding clauses (a)
through (o) so long as neither (i) the aggregate amount of obligations at any
time secured thereby, nor (ii) the aggregate fair market value of the assets
subject thereto, exceeds $5,000,000 at any time.
8.3 INDEBTEDNESS. Holdings and the Borrower will not, and will not
permit any of their respective Subsidiaries to, contract, create, incur, assume
or suffer to exist any Indebtedness, except:
(a) Indebtedness incurred pursuant to this Credit Agreement and
the other Credit Documents;
(b) Capitalized Lease Obligations and Indebtedness of the Borrower
and its Subsidiaries secured by Liens permitted by Section 8.2(h) in an
aggregate amount not to exceed $10,000,000 outstanding at any time;
(c) Existing Indebtedness;
(d) Indebtedness of the Borrower evidenced by the Senior Unsecured
Notes in aggregate principal amount not to exceed $550,000,000 (less the amount
of principal repayments thereof made after the Effective Date), and unsecured
guarantees thereof by the Subsidiary Guarantors, so long as the guarantee of the
Unit Subsidiary is subordinated on the terms as provided in the Senior Unsecured
Notes Indenture as in effect on the Effective Date;
(e) (i) Indebtedness of any Qualified Credit Party (other than the
Unit Subsidiary) owing to another Qualified Credit Party, in each case to the
extent making such loan is permitted in Section 8.5(i) or (k), (ii) Indebtedness
among Non-Canadian Foreign Subsidiaries, (iii) Indebtedness of the Borrower
owing to Non-Canadian Foreign Subsidiaries arising from
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loans and advances made in accordance with Section 8.5(o)(ii) and (iv)
Indebtedness of Non-Canadian Foreign Subsidiaries owing to the Borrower arising
from loans and advances made in accordance with Section 8.5(q);
(f) Indebtedness of the Borrower and/or Holdings evidenced by
guarantees, performance bonds and surety bonds (including reimbursement
obligations relating thereto) incurred in the ordinary course of business (and
not to support Indebtedness for borrowed money) for purposes of insuring the
performance of the Borrower or any of its Domestic Subsidiaries or Canadian
Subsidiaries in an aggregate principal amount, without duplication, not to
exceed $50,000,000 at any time outstanding;
(g) Indebtedness under Interest Rate Agreements determined in good
faith by the Borrower to be related to outstanding Indebtedness permitted to
remain outstanding pursuant to this Section 8.3 and which the Borrower in good
faith determines are non-speculative in nature;
(h) Indebtedness of the Borrower or any of the Borrower's
Subsidiaries incurred to refinance any outstanding Indebtedness described in
Section 8.3(c), in each case so long as the principal amount of such
Indebtedness outstanding of the time of the refinancing thereof is not increased
as a result of any such refinancing, the weighted average maturity thereof is
not decreased and no greater Liens or security interests are granted, and no
additional guarantees provided, in connection therewith;
(i) Indebtedness of Non-Canadian Foreign Subsidiaries in respect
of local lines of credit, letters of credit, bank guarantees and similar
extensions of credit, provided that (i) such Indebtedness shall not be
guaranteed by any Credit Agreement Party, any Domestic Subsidiary or any
Canadian Subsidiary or otherwise supported by any such entity (or any of its
assets) in any manner and (ii) the aggregate outstanding principal amount of
such Indebtedness shall not at any time exceed $25,000,000;
(j) Indebtedness of Foreign Subsidiaries under Other Hedging
Agreements providing protection against fluctuations in currency values in
connection with such Foreign Subsidiaries' operations so long as such Foreign
Subsidiary has determined that the entering into of such Other Hedging
Agreements are bona fide hedging activities and not for speculative purposes;
(k) Indebtedness which may exist as a result of guarantees
expressly permitted under clause (ii) of the proviso to Section 8.1(l) (subject
to compliance with the dollar limitations contained therein); and
(l) Indebtedness of the Borrower or any of the Borrower's
Subsidiaries, in addition to other Indebtedness permitted under clauses (a)
through (k) above, in an aggregate principal amount not to exceed $10,000,000 at
any time outstanding.
8.4 CAPITAL EXPENDITURES. (a) Holdings and the Borrower will not,
and will not permit any of their respective Domestic Subsidiaries or Canadian
Subsidiaries to, make any Capital Expenditures, except that during any fiscal
year set forth below, the Borrower and its Domestic Subsidiaries and Canadian
Subsidiaries may make Capital Expenditures, so long as the
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aggregate amount of such Capital Expenditures does not exceed in any fiscal year
set forth below the amount set forth below opposite such fiscal year:
FISCAL YEAR ENDING AMOUNT
------------------ ------
December 31, 2002 $70,000,000
December 31, 2003 $205,000,000
December 31, 2004 $208,000,000
December 31, 2005 $235,000,000
December 31, 2006 $250,000,000
(b) Notwithstanding the foregoing, in the event that the amount of
Capital Expenditures permitted to be made by the Borrower and its Domestic
Subsidiaries and Canadian Subsidiaries pursuant to clause (a) above in any
fiscal year (before giving effect to any increase in such permitted expenditure
amount pursuant to this clause (b) and after giving effect to any reduction in
such permitted expenditure amount pursuant to clause (c) below) is greater than
the amount of such Capital Expenditures made by the Borrower and its Domestic
Subsidiaries and Canadian Subsidiaries during such fiscal year, the lesser of
(i) such excess and (ii) 50% of the applicable permitted scheduled Capital
Expenditure amount for such fiscal year as set forth in such clause (a) above
(such lesser amount, the "CAPEX ROLLOVER AMOUNT") may be carried forward and
utilized to make Capital Expenditures in the immediately succeeding fiscal year.
(c) In addition to any amounts set forth in clause (a) or (b)
above, in any fiscal year the Borrower and its Domestic Subsidiaries and
Canadian Subsidiaries may make Capital Expenditures in an amount equal to 20% of
the amount set forth in clause (a) above for such fiscal year; PROVIDED, that
(i) no Capital Expenditures were made pursuant to this clause (c) during the
prior fiscal year and (ii) if Capital Expenditures are made during a fiscal year
pursuant to this clause (c), then the amount of Capital Expenditures permitted
for the subsequent fiscal year pursuant to clause (a) above shall be reduced by
the amount of such Capital Expenditures made during such fiscal year pursuant to
this clause (c).
(d) Notwithstanding the foregoing, Holdings, the Borrower and
their respective Domestic Subsidiaries and Canadian Subsidiaries may make
Capital Expenditures (which Capital Expenditures will not be included in any
determination under the foregoing clause (a), (b) or (c)) with the insurance
proceeds received by Holdings, the Borrower or any of their respective Domestic
Subsidiaries and Canadian Subsidiaries from any Casualty Loss so long as such
Capital Expenditures are to replace or restore any properties or assets in
respect of which such proceeds were paid in accordance with Section 7.10.
(e) To the extent any Capital Expenditures made pursuant to
clauses (a), (b) or (c) above involve the purchase or lease of real property,
such Capital Expenditures may not be made unless, to the best of the Borrower's
knowledge, such purchase or lease will not result in any material increase in
the contingent liabilities (including environmental liabilities) of the Borrower
or any of its Subsidiaries.
8.5 INVESTMENTS. Holdings and the Borrower will not, and will not
permit any of their respective Subsidiaries to, lend money or credit or make
advances to any Person, or purchase or acquire any stock, obligations or
securities issued by, or any other interest in, or make any capital contribution
to, any other Person, or
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purchase or own a futures contract or otherwise become liable for the purchase
or sale of currency or other commodities at a future date or in the nature of a
futures contract, or hold any cash or Cash Equivalents (each of the foregoing
"INVESTMENT" and, collectively, "INVESTMENTS"), except:
(a) the Borrower or any of its Subsidiaries may acquire and hold
accounts receivables owing to it, if created or acquired in the ordinary course
of business and payable or dischargeable in accordance with the customary trade
terms of the Borrower or its applicable Subsidiary, as the case may be;
(b) loans and advances to employees, officers and directors in the
ordinary course of business in an aggregate principal amount not to exceed
$1,000,000 at any time outstanding shall be permitted;
(c) subject to continued compliance with Section 7.18 and the last
paragraph of Section 8.1 in the case of any Investments being made by the Unit
Subsidiary, any Investment by any Qualified Subsidiary Guarantor in the Borrower
or in another Qualified Subsidiary Guarantor (except that loans and advances to
the Unit Subsidiary shall not be permitted);
(d) subject to Section 8.17, Investments in cash, Cash Equivalents
and, in the case of Foreign Subsidiaries, Foreign Cash Equivalents shall be
permitted;
(e) Investments by the Borrower and its Subsidiaries permitted
under Section 8.1 and Capital Expenditures permitted under Section 8.4 shall be
permitted;
(f) Investments existing on the Effective Date and listed on
Schedule XVI hereto, without giving effect to any additions thereto or
replacements thereof, shall be permitted;
(g) Investments which may be deemed to exist as a result of the
entering into of Interest Rate Agreements to the extent permitted by Section
8.3(g);
(h) Holdings may purchase or acquire stock or securities of or
make capital contributions to the Borrower;
(i) the Borrower and Qualified Subsidiary Guarantors may make
intercompany loans and advances to each other (but loans and advances may not be
made to the Unit Subsidiary), provided that in the case of any such loan or
advance made pursuant to this clause (i) that is evidenced by a promissory note
or other instrument, such promissory note or other instrument shall be in each
case pledged pursuant to the relevant Pledge Agreement;
(j) the Borrower and any Wholly-Owned Subsidiary (other than the
Unit Subsidiary) may make Permitted Acquisitions in accordance with the terms of
this Credit Agreement;
(k) so long as no Default or Event of Default is then in existence
or would exist immediately after giving effect thereto, the Borrower and its
Wholly-Owned Subsidiaries may make intercompany loans and advances (but loans
and advances may not be made to the
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Unit Subsidiary) to pay Dividends to the extent permitted by Section 8.6,
provided that any such loans or advances that are made by a Non-Canadian Foreign
Subsidiary to a Credit Party shall, in each case, be subordinated to the
Obligations on terms satisfactory to the Administrative Agent;
(l) the Borrower and its Subsidiaries may acquire and own
investments (including debt obligations) received in connection with the
bankruptcy or reorganization of suppliers and customers and in settlement of
delinquent obligations of, and other disputes with, customers and suppliers
arising in the ordinary course of business;
(m) the Borrower and the Qualified Subsidiary Guarantors may
purchase or acquire stock or securities of, or make capital contributions (but
not of Eligible Accounts Receivable) to, their respective Wholly-Owned
Subsidiaries which are Qualified Subsidiary Guarantors so long as any such
capital contributions are made in compliance with Section 7.18 (if applicable);
(n) the Non-Canadian Foreign Subsidiaries may purchase or acquire
stock or securities of, or make capital contributions to, other Non-Canadian
Foreign Subsidiaries;
(o) the Non-Canadian Foreign Subsidiaries may make loans and
advances to (i) one another and (ii) the Borrower, provided that any and all
such loans and advances made pursuant to this clause (ii) are (x) in cash
constituting funds repatriated by any such Non-Canadian Foreign Subsidiary to
the Borrower and (y) subordinated to the Obligations on terms satisfactory to
the Administrative Agent;
(p) Investments by Foreign Subsidiaries which may be deemed to
exist as a result of the entering into of Other Hedging Agreements to the extent
permitted by Section 8.3(j);
(q) so long as no Default or Event of Default is then in existence
or would exist immediately after giving affect thereto, the Borrower and its
Subsidiaries may from time to time make cash capital contributions, or loans or
advances, to any Non-Canadian Foreign Subsidiary so long as (x) such
Non-Canadian Foreign Subsidiary contemporaneously uses all of the proceeds
therefrom to either (I) effect a Permitted Acquisition in accordance with
Section 7.17 or (II) make Capital Expenditures and (y) the amount of all such
capital contributions, loans and advances, (as expended in connection with the
respective Permitted Acquisition or Capital Expenditure, as the case may be)
shall (and shall be deemed to) constitute a utilization of the relevant basket
amounts in Section 7.17(a)(vii) and shall, when added to all other relevant
expenditures pursuant to this clause (q) and Section 7.17, not cause either of
said basket amounts to be exceeded; and
(r) any Investments in addition to those contemplated by the
foregoing clauses (a) through (q), PROVIDED that all Investments made pursuant
to this clause (r) shall be permitted by the Senior Unsecured Notes Documents
and shall not exceed $10,000,000 at any time outstanding.
8.6 DIVIDENDS, ETC. Holdings and the Borrower will not, and will
not permit any of their respective Subsidiaries to, declare or pay any dividends
(other than dividends payable solely in common stock of the Person paying such
dividend) or return any capital to, its stockholders or authorize or make any
other distribution, payment or delivery of property or cash
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to its stockholders as such, or redeem, retire, purchase or otherwise acquire,
directly or indirectly, for a consideration (other than consideration in the
form of common stock of the Person paying such dividend), any shares of any
class of its capital stock now or hereafter outstanding (or any warrants for or
options or stock appreciation rights in respect of any of such shares), or set
aside any funds for any of the foregoing purposes and Holdings and the Borrower
will not permit any of their respective Subsidiaries to purchase or otherwise
acquire for consideration any shares of any class of the capital stock of
Holdings, the Borrower or any of their respective Subsidiaries now or hereafter
outstanding (or any warrants for or options or stock appreciation rights issued
by such Person in respect of any such shares) (all of the foregoing
"DIVIDENDS"), except that:
(a) any Subsidiary of the Borrower may pay Dividends to the
Borrower or any Wholly-Owned Subsidiary of the Borrower which owns equity
interest therein;
(b) Holdings may pay regularly scheduled Dividends on the
Permitted Preferred Stock pursuant to the terms thereof solely through the
issuance of additional preferred shares of such Permitted Preferred Stock;
(c) the Borrower may pay Dividends or make loans to Holdings to
enable Holdings to (i) pay reasonable and customary corporate and administrative
expenses not to exceed in the aggregate $500,000 per year in the ordinary course
and (ii) make payments expressly permitted pursuant to Section 8.7;
(d) so long as the payments relate to a period for which the
Borrower is a member of the same consolidated group as Holdings for federal
income tax purposes, the Borrower may make payments required pursuant to the Tax
Sharing Agreement as in effect on the Effective Date and delivered to the
Administrative Agent pursuant to Section 5.1(m);
(e) Holdings may repurchase Holdings Common Stock or options to
purchase Holdings Common Stock held by current or former directors, executives,
officers, members of management or employees of Holdings, the Borrower or any of
their respective Subsidiaries (or their spouses or estates), PROVIDED that (1)
no Default or Event of Default then exists or would exist immediately after
giving effect thereto and (2) the aggregate amount of cash expended by Holdings
pursuant to this clause (e) during any fiscal year of Holdings shall not exceed
$3,000,000 in the aggregate;
(f) the Borrower may pay cash Dividends or make loans to Holdings
for the purpose of enabling Holdings to make the purchases referred to in clause
(e) above, so long as all proceeds thereof are promptly used by Holdings to make
such purchases and/or pay such Dividends; and
(g) repurchases of capital stock of Holdings which may be deemed
to occur upon exercise of stock options if such capital stock represents a
portion of the exercise price of such options.
8.7 TRANSACTIONS WITH AFFILIATES. Holdings and the Borrower will
not, and will not permit any of their respective Subsidiaries to, enter into any
transaction or series of transactions after the Effective Date, whether or not
in the ordinary course of business, with any
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Affiliate other than on terms and conditions substantially as favorable to
Holdings, the Borrower or such Subsidiary as would be obtainable by Holdings,
the Borrower or such Subsidiary at the time in a comparable arm's-length
transaction with a Person other than an Affiliate, PROVIDED that the foregoing
restrictions shall not apply to (i) payments by Holdings, the Borrower and any
of their respective Subsidiaries to the Equity Investors and their respective
Affiliates made pursuant to any financial advisory, financing, underwriting or
placement agreement, or in respect of other investment banking activities, in
each case as approved by the board of directors of such Person in good faith, so
long as the amount of any such fees, expenses, or other amounts paid for any
such service provided shall not exceed the usual and customary fees for similar
services rendered by or obtainable from Persons other than the Equity Investors
and their Affiliates to such Credit Party, (ii) employment arrangements entered
into in the ordinary course of business with officers, directors or similar
executives of Holdings, the Borrower, and their respective Subsidiaries, (iii)
customary fees paid to members of the Board of Directors of Holdings, the
Borrower, and their respective Subsidiaries, (iv) subject to, in the case of the
Unit Subsidiary, continued compliance with the requirements of Section 7.18 and
the last paragraph of Section 8.1, transactions between the Borrower and any of
its Wholly-Owned Subsidiaries or among Wholly-Owned Subsidiaries of the
Borrower; (v) transactions expressly permitted pursuant to Section 8.6; (vi) any
issuance of securities, or other payments, benefits, awards or grants in cash,
securities or otherwise, pursuant to, or the funding of, employment
arrangements, stock option and stock ownership plans or deferred compensation
plans approved by the Board of Directors of Holdings, the Borrower or the
respective Subsidiary (other than the Unit Subsidiary); (vii) loans or advances
to employees in the ordinary course of business in accordance with past
practices of Holdings, the Borrower or its Subsidiaries (other than the Unit
Subsidiary), but in any event not to exceed $1,000,000 in aggregate amount at
any time outstanding (calculated without regard to any write-downs or write-offs
thereof); (viii) payments pursuant to the Tax Sharing Agreement as in effect on
the Effective Date; (ix) indemnification agreements with, and the payment of
fees and indemnity to, directors, officers and employees of Holdings, the
Borrower or any Subsidiary of the Borrower (other than the Unit Subsidiary) in
each case in the ordinary course of business; (x) any severance, noncompetition
or confidentiality agreement entered into by Holdings, the Borrower or any
Subsidiary (other than the Unit Subsidiary) with its employees in the ordinary
course of business; and (xi) Holdings' entrance into and, subject to continued
compliance with the terms and conditions set forth herein, Holdings' performance
of its obligations under (a) the Investor Stockholders Agreement dated as of May
22, 1997 among Holdings, Cypress Merchant Banking Partners L.P., Cypress
Offshore Partners L.P., Scotsman Partners L.P., Odyssey Partners, L.P. and BT
Investment Partners, Inc. (as same is amended pursuant to Amendment No. 1
thereto, dated as of September 1, 1998), (b) the Second Amended and Restated
Management Stockholders' and Optionholders' Agreement dated as of May 22, 1997
among Holdings, Cypress Merchant Banking Partners L.P., Cypress Offshore
Partners L.P., Scotsman Partners, L.P., the Management Stockholders (as defined
therein) and the Permitted Transferees (as defined therein) of the Management
Stockholders who become parties thereto pursuant to the terms and provisions
contained therein and (c) the Amending Agreement dated as of May 22, 1997 among
Holdings, Odyssey Partners, L.P. and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇.
Notwithstanding the foregoing, Holdings and the Borrower shall not, and
shall not permit their respective Subsidiaries to, enter into any agreements
with any Affiliates thereof (or any officers or management of such Affiliates),
or any other Person providing for management services (other than the Unit
Subsidiary Management Agreement and any other Management
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Agreements whereby one or more Subsidiaries of the Borrower pay fees for
management services solely to the Borrower).
8.8 CHANGES IN BUSINESS. (a) Holdings and the Borrower will not,
and will not permit their respective Subsidiaries to, engage in any business
except (i) all or any part of the business of selling and leasing storage
containers, mobile offices and modular structures and related equipment or any
other equipment sold or leased to a similar customer base and (ii) any business
or services related, ancillary or complementary to such businesses.
(b) Holdings shall not engage in any business other than relating
to its ownership of the capital stock of the Borrower, its guaranty of the
Borrower's obligations under the Credit Agreement and any other activity
expressly contemplated by this Credit Agreement and the other Credit Documents.
Holdings shall have no significant assets other than its ownership interests as
described in the immediately preceding sentence and shall act as a holding
company which shall not directly engage in any business.
8.9 CONSOLIDATED LEVERAGE RATIO. The Credit Agreement Parties will
not permit the Consolidated Leverage Ratio at any time during a period set forth
below to be greater than the ratio set forth opposite such period below:
PERIOD RATIO
------ -----
From the Effective Date through and 5.90:1.00
including March 30, 2003
From March 31, 2003 through and including 5.80:1.00
December 30, 2003
From December 31, 2003 through and 5.60:1.00
including March 30, 2004
From March 31, 2004 through and including 5.50:1.00
June 29, 2004
From June 30, 2004 through and including 5.40:1.00
December 30, 2004
From December 31, 2004 through and 5.10:1.00
including June 29, 2005
From June 30, 2005 through and including 5.00:1.00
December 30, 2005
From December 31, 2005 through and 4.75:1.00
including June 29, 2006
From June 30, 2006 through and including 4.60:1.00
December 30, 2006
Thereafter 4.50:1.00
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8.10 CONSOLIDATED INTEREST COVERAGE RATIO. The Credit Agreement
Parties will not permit the Consolidated Interest Coverage Ratio for any Test
Period ended on a date set forth below to be less than the ratio set forth
opposite such date:
DATE RATIO
---- -----
March 31, 2002 2.00:1.00
June 30, 2002 2.00:1.00
September 30, 2002 2.00:1.00
December 31, 2002 2.00:1.00
March 31, 2003 2.00:1.00
June 30, 2003 2.00:1.00
September 30, 2003 2.00:1.00
December 31, 2003 2.10:1.00
March 31, 2004 2.10:1.00
June 30, 2004 2.10:1.00
September 30, 2004 2.10:1.00
December 31, 2004 2.20:1.00
March 31, 2005 2.20:1.00
June 30, 2005 2.20:1.00
September 30, 2005 2.20:1.00
December 31, 2005 2.25:1.00
March 31, 2006 2.25:1.00
June 30, 2006 2.25:1.00
September 30, 2006 2.25:1.00
December 31, 2006 2.25:1.00
8.11 UTILIZATION. The Borrower will not permit the Utilization for
any period of 13 consecutive fiscal months ended on the last day of any fiscal
quarter (calculated by taking the average of the Utilization for each of the 13
months in such period) ending (x) after the Effective Date and on or prior to
December 31, 2002, to be less than 76% and (y) thereafter, to be less than 78%.
8.12 CREATION OF SUBSIDIARIES. Holdings and the Borrower will not,
and will not permit any of their respective Subsidiaries to, create or acquire
any Subsidiaries without the written consent of the Required Lenders, except (i)
as permitted in Section 7.17 and (ii) the Borrower may create Non-Canadian
Foreign Subsidiaries from time to time so long as (x) to the extent such
Non-Canadian Foreign Subsidiary is owned by a Credit Party, the equity interests
of such Non-Canadian Foreign Subsidiary is pledged to the Collateral Agent
pursuant to the relevant Pledge Agreement (although if the granting of a pledge
of more than 66-2/3% of the voting capital stock or voting equity interests of
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such Non-Canadian Foreign Subsidiary would give rise to "deemed dividend" tax
consequences under Section 956 of the Code, then not more than 65% of the
outstanding voting capital stock or equity interests (plus 100% of the
non-voting capital stock or equity interests) shall be required to be pledged to
the Collateral Agent pursuant to the relevant Pledge Agreement) and (y) all
Investments (and any other contribution) made by Holdings or any of its
Subsidiaries in or to any such Non-Canadian Foreign Subsidiary are permitted
under Section 8.5. Unless otherwise specifically consented to in writing by the
Required Lenders, Holdings will not own the capital stock of, or other equity
interests in, any Person other than the Borrower, with the only Subsidiaries of
Holdings being the Borrower and Subsidiaries of Borrower.
8.13 LIMITATION ON VOLUNTARY PAYMENTS AND MODIFICATIONS OF
INDEBTEDNESS; MODIFICATIONS OF GOVERNING DOCUMENTS, PREFERRED STOCK AND CERTAIN
OTHER AGREEMENTS; ETC. Holdings and the Borrower will not, and will not permit
any of their respective Subsidiaries to:
(i) make (or give any notice in respect of) any voluntary or
optional payment or prepayment on or redemption or acquisition for
value of (including, without limitation, by way of depositing with the
trustee with respect thereto or any other Person money or securities
before due for the purpose of paying when due), exchange or purchase,
redeem or acquire for value (whether as a result of a Change of
Control, the consummation of asset sales or otherwise) any Senior
Unsecured Note;
(ii) amend or modify, or permit the amendment or modification of,
any provision of any Senior Unsecured Notes Document, except any
amendment or modification which is not adverse to the Lenders in any
respect (it being understood and agreed that, with respect to the
Senior Unsecured Notes Documents, in no event shall any amendment be
permitted which relates to the Unit Subsidiary's guaranty of the Senior
Unsecured Notes or the subordination provisions applicable thereto);
(iii) amend, modify or change in any way adverse to the interests of
the Lenders, any Tax Sharing Agreement, any Management Agreement, the
Master Lease Agreements, the Unit Subsidiary Management Agreement, the
Trade Name License Agreement, any of its Governing Documents
(including, without limitation, by the filing or modification of any
certificate of designation) or any agreement entered into by it, with
respect to its capital stock (including any Shareholders' Agreement),
or enter into any new Tax Sharing Agreement, Management Agreement or
agreement with respect to its capital stock which could in any way be
adverse to the interests of the Lenders in their capacity as such; or
(iv) amend, modify or change in any way adverse to the Lenders any
preferred stock (or any certificates of designation relating thereto).
8.14 ISSUANCE OF STOCK. (a) Holdings shall not issue any shares of
capital stock after the Effective Date, other than (i) shares of Holdings Common
Stock to the extent not resulting in a Change of Control, (ii) shares of
Permitted Preferred Stock on terms and
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conditions, and pursuant to documentation, in form and substance satisfactory to
the Administrative Agent and the Required Lenders, and (iii) shares of Permitted
Preferred Stock paid as pay-in-kind Dividends on the Permitted Preferred Stock
and (b) Holdings will not permit any of its Subsidiaries directly or indirectly
to, issue, sell, assign, pledge or otherwise encumber or dispose of any shares
of its capital stock or other equity securities (or warrants, rights or options
to acquire shares or other equity securities) of such Subsidiary to any Person
other than Holdings, and, in the case of any Subsidiary of the Borrower, the
Borrower or a Wholly-Owned Subsidiary of the Borrower, except, (x) to the extent
permitted by Sections 7.3, 7.17, 8.1(c), 8.2 and 8.5 and (y) for the issuance of
directors' qualifying shares to the extent required by applicable law.
8.15 LIMITATION ON RESTRICTIONS AFFECTING SUBSIDIARIES. Each of
Holdings and the Borrower will not, and will not permit any of their respective
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist any encumbrance or restriction which prohibits or limits the ability of
the Borrower or any Subsidiary of Holdings or the Borrower to (a) pay dividends
or make other distributions or pay any Indebtedness owed to Holdings, the
Borrower or any of their respective Subsidiaries, (b) make loans or advances to
Holdings, the Borrower or any of their respective Subsidiaries, (c) transfer any
of its properties or assets to Holdings, the Borrower or any of their respective
Subsidiaries or (d) create, incur, assume or suffer to exist any lien upon any
of its property, assets or revenues, whether now owned or hereafter acquired,
other than encumbrances and restrictions arising under (i) applicable law, (ii)
this Credit Agreement and the other Credit Documents, (iii) Indebtedness
permitted pursuant to Sections 8.3(c), (d) and (i), (iv) customary provisions
restricting subletting or assignment of any lease governing a leasehold interest
of Holdings, the Borrower or any of their respective Subsidiaries, (v) customary
restrictions on dispositions of real property interests found in reciprocal
easement agreements of Holdings, the Borrower or any of their respective
Subsidiaries, (vi) any agreement relating to Indebtedness incurred by a
Subsidiary of the Borrower prior to the date on which such Subsidiary was
acquired by the Borrower and outstanding on such acquisition date, (vii) the
extension or continuation of contractual obligations in existence on the date
hereof, PROVIDED that any such encumbrances or restrictions contained in such
continuation are no less favorable to the Lenders, than those encumbrances and
restrictions under or pursuant to the contractual obligations continued hereby,
(viii) restrictions imposed under the agreements relating to Indebtedness
permitted under Section 8.3(b), PROVIDED that such restrictions apply only to
the property securing such Indebtedness as permitted hereunder and (ix)
restrictions imposed on the transfer of rights under contracts related to sales
of Leases or conditional sales made pursuant to Section 8.1(l) so long as any
guarantees of such Leases do not exceed the dollar limitations contained in
clause (ii) of the proviso contained in such Section 8.1(l).
8.16 NO ADDITIONAL BANK ACCOUNTS. Holdings and the Borrower will
not, and will not permit any of their respective Domestic Subsidiaries or
Canadian Subsidiaries to, directly or indirectly, open, maintain or otherwise
have any checking, savings, any other deposit accounts or any other accounts at
any bank or other financial institution where money or any other assets is or
may be deposited or maintained with any Person, other than (A) in the case of
the Credit Agreement Parties and their Domestic Subsidiaries (i) the
Concentration Account, the Collection Accounts, the Disbursement Account, any
cash collateral account established pursuant to Section 2.5(a) and the accounts
set forth on Schedule XVII and (ii) local accounts
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in the ordinary course of business and in compliance with Section 8.17, it being
understood that in no event shall Holdings, the Borrower or any of their
respective Domestic Subsidiaries be permitted to direct any payments on behalf
of any Accounts or Leases or any other Collateral to such local accounts and (B)
in the case of any Canadian Subsidiary (but subject to the provisions of Section
11.19(d) during the first 45 days after the Initial Borrowing Date) in an
account subject to a Canadian Bank Control Agreement.
8.17 NO EXCESS CASH. (a) Holdings and the Borrower will not, and
will not permit any of their respective Domestic Subsidiaries to, directly or
indirectly, maintain in the aggregate in all of the checking, savings or other
accounts (other than the Disbursement Accounts, the Collection Accounts, the
Concentration Account, the payroll accounts and the Deferred Compensation
Program Investment Account set forth on Schedule XVII) of Holdings, the Borrower
and their respective Domestic Subsidiaries total cash balances and investments
(including Investments in Cash Equivalents) in excess of $500,000 at any time
during which any Revolving Loans are outstanding hereunder.
(b) Holdings and the Borrower will not permit their respective
Canadian Subsidiaries to maintain in the aggregate in all of the checking
savings or other accounts of such Canadian Subsidiaries total cash balances and
investments (including Investments in Cash Equivalents and Foreign Cash
Equivalents) in excess of $10,000,000 for fifteen or more consecutive days at
any time during which Revolving Loans are outstanding hereunder.
8.18 ACCOUNT TERMS. The Borrower shall, and shall cause each of its
Subsidiaries to, promptly pay when due, or in conformity with customary trade
terms consistent with past practices, all of their trade accounts payable,
except for late payment in the ordinary course of business, the lateness of
which payment, singly or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect.
8.19 PERMITTED PREFERRED STOCK. At all times prior to the Maturity
Date and thereafter until the payment in full in cash of all Obligations then
due and payable hereunder and under the other Credit Documents, the Borrower
shall pay Dividends on the Permitted Preferred Stock only in additional shares
of Permitted Preferred Stock.
8.20 UNIT SUBSIDIARY. Notwithstanding anything to the contrary
contained elsewhere in this Credit Agreement, in no event shall (i) the Unit
Subsidiary be liquidated and/or dissolved, (ii) the Unit Subsidiary be merged or
consolidated with or into Holdings, the Borrower or any of their respective
other Subsidiaries or any other Person, (iii) the Unit Subsidiary become a
"Guarantor" as opposed to a "Subordinated Guarantor" under the Senior Unsecured
Notes Indenture or (iv) the Borrower permit the "Subordinated Guaranty" of the
Unit Subsidiary contained in the Senior Unsecured Notes Indenture to be
released.
8.21 CHANGE OF LEGAL NAMES; TYPE OF ORGANIZATION (AND WHETHER A
REGISTERED ORGANIZATION); JURISDICTION OF ORGANIZATION ETC. Neither Holdings,
the Borrower nor any Subsidiary Guarantor shall change its legal name, its type
of organization, its status as a registered organization (in the case of a
registered organization), its jurisdiction of organization, its Location, or its
organizational identification number (if any), except that any such changes
shall be permitted (so long as not in violation of the applicable requirements
of the Collateral
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Documents and so long as same do not involve (x) a registered organization
ceasing to constitute same or (y) Holdings, the Borrower or any Subsidiary
Guarantor changing its jurisdiction of organization or location from the United
States or a State thereof to a jurisdiction of organization or location, as the
case may be, outside the United States or a State thereof) if (i) it shall have
given to the Collateral Agent not less than 15 days' prior written notice of
each change to the information listed on Schedule XI (as adjusted for any
subsequent changes thereto previously made in accordance with this sentence),
together with a supplement to Schedule XI which shall correct all information
contained therein for Holdings, the Borrower or the respective Subsidiary
Guarantor, and (ii) in connection with the respective such change or changes, it
shall have taken all action reasonably requested by the Collateral Agent to
maintain the security interests of the Collateral Agent in the Collateral
intended to be granted hereby pursuant to the Collateral Documents at all times
fully perfected and in full force and effect.
ARTICLE 9
EVENTS OF DEFAULT AND REMEDIES
------------------------------
9.1 EVENTS OF DEFAULT. Upon the occurrence of any of the following
specified events (each an "EVENT OF DEFAULT"):
(a) PAYMENTS. The Borrower shall (i) default in the payment when
due of any principal of any Loans or (ii) default, and such default shall
continue for five or more days, in the payment when due of any interest on any
Loans or any drawings under Letters of Credit which have not been reimbursed by
the Borrower (including through the incurrence of Revolving Loans), or (iii)
default, and such default shall continue for five or more days after written
demand therefor by the Administrative Agent, in the payment when due of any
Fees, Expense or any other amounts owing hereunder or under any other Credit
Document; or
(b) REPRESENTATIONS, ETC. Any representation or warranty made by
any Credit Party herein or in any other Credit Document or in any statement or
certificate delivered or required to be delivered pursuant hereto or thereto
shall prove to be untrue in any material respect on the date as of which made or
deemed made; or
(c) COVENANTS. Holdings or the Borrower shall (i) default in the
due performance or observance by it of any term, covenant or agreement contained
in Sections 7.1(e), 7.1(h), 7.8, 7.12, 7.17, 7.18, 7.20, 11.19, 11.20 or Article
8, or (ii) default in the due performance or observance by it of any term,
covenant or agreement (other than those referred to in Section 9.1(a), 9.1(b) or
clause (i) of this Section 9.1(c)) contained in this Credit Agreement or the
other Credit Documents and such default shall continue unremedied for a period
of at least 30 days after notice to the defaulting party by the Administrative
Agent or the Required Lenders; or
(d) DEFAULT UNDER OTHER AGREEMENTS. (i) Holdings, the Borrower or
any of their respective Subsidiaries shall (x) default in any payment with
respect to any Indebtedness (other than the Obligations) beyond the period of
grace, if any, applicable thereto or (y) default in the observance or
performance of any agreement or condition relating to any such Indebtedness or
contained in any instrument or agreement evidencing, securing or relating
thereto, or any other event shall occur or condition exist, the effect of which
default or other
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event or condition is to cause, or to permit the holder or holders of such
Indebtedness (or a trustee or agent on behalf of such holder or holders) to
cause any such Indebtedness to become due prior to its stated maturity; or (ii)
any such Indebtedness of Holdings, the Borrower or any of their respective
Subsidiaries shall be declared by the holders thereof or a representative
therefor to be due and payable prior to the stated maturity thereof; PROVIDED
that it shall not constitute an Event of Default pursuant to this Section 9.1
unless the aggregate principal amount of all such Indebtedness referred to in
clauses (i) and/or (ii) above exceeds $5,000,000; or
(e) BANKRUPTCY, ETC. Holdings, the Borrower or any of their
respective Subsidiaries, shall commence a voluntary case concerning itself under
Title 11 of the United States Code entitled "Bankruptcy", as now or hereafter in
effect, or any successor thereto (the "BANKRUPTCY CODE"); or an involuntary case
is commenced against Holdings, the Borrower or any of their respective
Subsidiaries, and the petition is not controverted within 30 days, or is not
dismissed within 60 days, after commencement of the case; or a custodian (as
defined in the Bankruptcy Code) is appointed for, or takes charge of, all or
substantially all of the property of Holdings, the Borrower or any of its
Subsidiaries; or Holdings, the Borrower or any of their respective Subsidiaries
commences any other proceeding under any reorganization, arrangement, adjustment
of debt, relief of debtors, dissolution, insolvency or liquidation or similar
law of any jurisdiction whether now or hereafter in effect relating to Holdings,
the Borrower or such Subsidiary; or there is commenced against Holdings, the
Borrower or any of their respective Subsidiaries, any such proceeding which
remains undismissed for a period of 60 days; or Holdings, the Borrower or any of
their respective Subsidiaries is adjudicated insolvent or bankrupt; or any order
of relief or other order approving any such case or proceeding is entered; or
Holdings, the Borrower or any of their respective Subsidiaries suffers any
appointment of any custodian or the like for it or any substantial part of its
property to continue undischarged or unstayed for a period of 60 days; or
Holdings, the Borrower or any of their respective Subsidiaries makes a general
assignment for the benefit of creditors; or any corporate action is taken by
Holdings, the Borrower or any of their respective Subsidiaries for the purpose
of effecting any of the foregoing; or
(f) ERISA. (i) Any Plan shall fail to satisfy the minimum funding
standard required for any plan year or part thereof after the Effective Date
under Section 412 of the Code or Section 302 of ERISA or a waiver of such
standard or extension of any amortization period is sought or granted under
Section 412 of the Code or Section 303 or 304 of ERISA, a Reportable Event shall
have occurred, a contributing sponsor (as defined in Section 4001(a)(13) of
ERISA) of a Plan subject to Title IV of ERISA shall be subject to the advance
reporting requirement of PBGC Regulation Section 4043.61 (without regard to
subparagraph (b)(1) thereof) and an event described in subsection .62, .63, .64,
..65, .66, .67 or .68 of PBGC Regulation Section 4043 shall be reasonably
expected to occur with respect to such Plan within the following 30 days, any
Plan which is subject to Title IV of ERISA shall have had or is likely to have a
trustee appointed to administer such Plan, any Plan which is subject to Title IV
of ERISA is, shall have been or is likely to be terminated or to be the subject
of termination proceedings under ERISA, any Plan subject to Title IV of ERISA
shall have an Unfunded Current Liability, a contribution required to be made
with respect to a Plan or a Foreign Pension Plan has not been timely made, the
Borrower or any Subsidiary of the Borrower or any ERISA Affiliate has incurred
or is likely to incur any liability to or on account of a Plan under Section
409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or
Section 401(a)(29), 4971 or 4975 of the Code or on
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account of a group health plan (as defined in Section 607(1) of ERISA or Section
4980B(g)(2) of the Code) under Section 4980B of the Code, or the Borrower or any
Subsidiary of the Borrower has incurred or is likely to incur liabilities
pursuant to one or more employee welfare benefit plans (as defined in Section
3(1) of ERISA) that provide benefits to retired employees or other former
employees (other than as required by Section 601 of ERISA or any other
applicable continuation of coverage laws) or Plans or Foreign Pension Plans;
(ii) there shall result from any such event or events the imposition of a Lien,
the granting of a security interest, or a liability or a material risk of
incurring a liability; and (iii) such Lien, security interest or liability,
individually, and/or in the aggregate, has had, or could reasonably be expected
to have, a Material Adverse Effect; or
(g) COLLATERAL DOCUMENTS. Any Collateral Document shall cease to
be in full force and effect (except in accordance with the terms thereof), or
shall cease to give the Collateral Agent on behalf of the Lenders the perfected
Liens, rights, powers or privileges purported to be created thereby in favor of
the Collateral Agent, any Credit Party shall default in any material respect in
the due performance or observance of any term, covenant or agreement on its part
to be performed or observed pursuant to any such Collateral Document and such
default shall continue unremedied for a period of at least 30 days after notice
to the Borrower by the Administrative Agent or the Required Lenders; or
(h) JUDGMENTS. One or more judgments or decrees shall be entered
against Holdings, the Borrower or any of their respective Subsidiaries involving
liability of $2,500,000 or more in the aggregate for all such judgments or
decrees (in each case, to the extent not paid or covered by insurance provided
by a carrier that has acknowledged coverage) and all such judgments or decrees
shall not have been vacated, discharged or stayed pending appeal within 60 days
from the entry thereof; or
(i) CHANGE OF CONTROL. A Change of Control shall occur; or
(j) GUARANTY. Any Guaranty shall cease to be in full force and
effect (except in accordance with the terms thereof), or any Guarantor shall
default in any material respect in the due performance or observance of any
term, covenant or agreement on its part to be performed or observed pursuant
thereto or any Guarantor shall deny or disaffirm any of its obligations
thereunder and such default, denial or disaffirmation shall continue unremedied
for a period of at least 30 days after notice to the Borrower by the
Administrative Agent or the Required Lenders;
then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Administrative Agent may, and shall upon the
written request of the Required Lenders, by written notice to the Borrower, take
any or all of the following actions, without prejudice to the rights of any
Agent or any Lender to enforce its claims against the Borrower, except as
otherwise specifically provided for in this Credit Agreement (PROVIDED that, if
an Event of Default specified in Section 9.1(e) shall occur with respect to the
Borrower or the Unit Subsidiary, the result which would occur upon the giving of
written notice by the Administrative Agent as specified in clause (i) below
shall occur automatically without the giving of any such notice): (i) declare
the Total Commitments terminated, whereupon the Commitments of each Lender shall
forthwith terminate immediately and any accrued and unpaid Unused Line Fee shall
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forthwith become due and payable without any other notice of any kind and
declare the principal of and any accrued interest in respect of all Loans and
all other Obligations owing hereunder to be, whereupon the same shall become,
forthwith due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Borrower; (ii) direct the
Collateral Agent to enforce any or all of the Liens and security interests
created pursuant to the Collateral Documents; (iii) terminate any Letter of
Credit which may be terminated in accordance with its terms; and/or (iv) direct
the Borrower to pay (and the Borrower hereby agrees upon receipt of such notice,
or upon the occurrence of any Event of Default specified in Section 9.1(e) in
respect of the Borrower, it will pay) to the Payments Administrator at its
Payment Office such additional amounts of cash, to be held as security for the
Borrower's reimbursement obligations in respect of Letter of Credit then
outstanding equal to the aggregate of all Letters of Credit Obligations.
ARTICLE 10
THE AGENTS
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10.1 APPOINTMENT. (a) Each Lender hereby designates BTCo as
Administrative Agent (for purposes of this Section 10, the term "Administrative
Agent" shall include BTCo as Payments Administrator and as Collateral Agent
under the Collateral Documents), in each case to act as specified herein and in
the other Credit Documents. Each Lender hereby appoints Fleet Capital
Corporation and Congress Financial Corporation as Co-Syndication Agents, in each
case to act as specified herein and in the other Credit Documents. Each Lender
hereby appoints Bank of America, N.A. and GMAC Business Credit, LLC as
Co-Documentation Agents, in each case to act as specified herein and in the
other Credit Documents. Each Lender hereby irrevocably authorizes, and each
holder of any Note or participation in any Letter of Credit by the acceptance of
a Note or participation shall be deemed irrevocably to authorize, each Agent to
take such action on its behalf under the provisions of this Credit Agreement and
the Notes and any other instruments and agreements referred to herein and to
exercise such powers and to perform such duties hereunder and thereunder as are
specifically delegated to or required of such Agent by the terms hereof and
thereof and such other powers as are reasonably incidental thereto. Each Agent
may perform any of its duties herein by or through its respective officers,
directors, agents, employees or affiliates. Subject to the various Credit
Documents, the Collateral Agent shall hold all Collateral and the Payments
Administrator shall hold all payments of principal, interest, Fees, charges and
Expenses received pursuant to this Credit Agreement or any other Credit Document
for the benefit of the Lenders to be distributed as provided herein and therein.
Each Agent may perform any of its duties hereunder by or through its agents or
employees.
(b) The provisions of this Article 10 are solely for the benefit
of the Agents and the Lenders, and neither Holdings, the Borrower nor any of
their respective Subsidiaries shall have any rights as a third party beneficiary
of any of the provisions hereof (other than Sections 10.9 and 10.10(c)). In
performing its functions and duties under this Credit Agreement, each Agent
shall act solely as agent of the Lenders and does not assume and shall not be
deemed to have assumed any obligation toward or relationship of agency or trust
with or for Holdings, the Borrower or any of their respective Subsidiaries.
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10.2 NATURE OF DUTIES. No Agent shall have any duties or
responsibilities except those expressly set forth in this Credit Agreement and
the other Credit Documents. No Agent nor any of its officers, directors,
employees or agents shall be liable for any action taken or omitted by it as
such hereunder or in connection herewith, unless caused by its or their gross
negligence or willful misconduct. The duties of each Agent shall be mechanical
and administrative in nature; no Agent shall have by reason of this Credit
Agreement or the other Credit Documents a fiduciary relationship in respect of
any Lender; and nothing in this Credit Agreement or the other Credit Documents,
expressed or implied, is intended to or shall be so construed as to impose upon
any Agent any obligations in respect of this Credit Agreement or the other
Credit Documents except as expressly set forth herein or therein.
10.3 LACK OF RELIANCE ON THE AGENTS. (a) Independently and without
reliance upon any Agent, each Lender, to the extent it deems appropriate, has
made and shall continue to make (i) its own independent investigation of the
financial or other condition and affairs of Holdings, the Borrower and their
respective Subsidiaries in connection with the taking or not taking of any
action in connection herewith and (ii) its own appraisal of the creditworthiness
of Holdings, the Borrower and their respective Subsidiaries, and, except as
expressly provided in this Credit Agreement, no Agent shall have any duty or
responsibility, either initially or on a continuing basis, to provide any Lender
with any credit or other information with respect thereto, whether coming into
its possession before the making of the Loans or at any time or times
thereafter.
(b) No Agent shall be responsible to any Lender for any recitals,
statements, information, representations or warranties herein or in any
document, certificate or other writing delivered in connection herewith or for
the execution, effectiveness, genuineness, validity, enforceability,
collectibility, priority or sufficiency of this Credit Agreement or the other
Credit Documents (or for the validity, perfection or priority of any Liens
purported to be created or granted pursuant thereto) or the financial or other
condition of Holdings, the Borrower or any of their respective Subsidiaries. No
Agent shall be required to make any inquiry concerning either the performance or
observance of any of the terms, provisions or conditions of this Credit
Agreement or the other Credit Documents, or the financial condition of Holdings,
the Borrower or any of their respective Subsidiaries, or the existence or
possible existence of any Default or Event of Default.
10.4 CERTAIN RIGHTS OF THE AGENTS. Each Agent shall have the right
to request instructions from the Required Lenders at any time. If any Agent
shall request instructions from the Required Lenders with respect to any act or
action (including the failure to act) in connection with this Credit Agreement
or the other Credit Documents, such Agent shall be entitled to refrain from such
act or taking such action unless and until such Agent shall have received
instructions from the Required Lenders and such Agent shall not incur liability
to any Person by reason of so refraining. Without limiting the foregoing, no
Lender shall have any right of action whatsoever against any Agent as a result
of such Agent acting or refraining from acting hereunder in accordance with the
instructions of the Required Lenders.
10.5 RELIANCE BY THE AGENTS. Each Agent shall be entitled to rely,
and shall be fully protected in relying, upon any note, writing, resolution,
notice, statement, certificate, telex, teletype or telecopier message,
cablegram, radiogram, order or other documentary,
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teletransmission or telephone message believed by it to be genuine and correct
and to have been signed, sent or made by the proper Person. Each Agent may
consult with legal counsel (including counsel for Holdings and the Borrower with
respect to matters concerning Holdings, the Borrower and their respective
Subsidiaries), 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.
10.6 INDEMNIFICATION. To the extent that any Agent is not
reimbursed and indemnified by Holdings or the Borrower, each Lender will
reimburse and indemnify such Agent and any affiliate thereof, in proportion to
its percentage voting interest as in effect from time to time for purposes of
determining the Required Lenders (for this purpose, determined as if there were
no Defaulting Lenders and, from and after any date upon which all Obligations
have been paid in full, with such determinations to be made immediately prior to
giving effect to such repayment in full), for and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses (including counsel fees and disbursements) or disbursements of
any kind or nature whatsoever (including all Expenses) which may be imposed on,
incurred by or asserted against such Agent and any affiliate thereof in
performing its duties hereunder or under any other Credit Document, or in any
way relating to or arising out of this Credit Agreement or any other Credit
Document; PROVIDED, that no Lender shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from such Agent's (or such
affiliate's) gross negligence or willful misconduct (as determined by a court of
competent jurisdiction in a final and unappealable decision). The agreements
contained in this Section shall survive any termination of this Credit Agreement
and the other Credit Documents and the payment in full of the Obligations.
10.7 EACH AGENT IN ITS INDIVIDUAL CAPACITY. With respect to its
obligation to lend under this Credit Agreement, the Loans made by it and the
Notes issued to it, and its participation in Letters of Credit issued hereunder,
each Agent shall have the same rights and powers hereunder as any other Lender
or holder of a Note or participation interests and may exercise the same as
though it was not performing the duties specified herein; and the terms
"Lenders", "Required Lenders", "holders of Revolving Notes", "holders of Term
Notes" or any similar terms shall, unless the context clearly otherwise
indicates, include each Agent in its individual capacity. Each Agent may accept
deposits from, lend money to, acquire equity interests in, and generally engage
in any kind of banking, trust, financial advisory or other business with
Holdings or Borrower or any Affiliate thereof as if it were not performing the
duties specified herein, and may accept fees and other consideration from
Holdings, the Borrower or an Affiliate thereof for services in connection with
this Credit Agreement and otherwise without having to account for the same to
the Lenders.
10.8 HOLDERS OF NOTES. The Administrative Agent may deem and treat
the payee of any Note as the owner thereof for all purposes hereof unless and
until a written notice of the assignment or transfer thereof shall have been
filed with the Administrative Agent. Any request, authority or consent of any
Person who, at the time of making such request or giving such authority or
consent, is the holder of any Note, shall be conclusive and binding on any
subsequent holder, transferee or assignee of such Note or of any Note, or Notes
issued in exchange therefor.
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10.9 RESIGNATION BY THE AGENTS; SUCCESSOR AGENTS; ETC. (a) The
Administrative Agent may, upon five Business Days' notice to the Lenders and the
Borrower, resign at any time (effective upon the appointment of a successor
Administrative Agent pursuant to the provisions of this Section 10.9) by giving
written notice thereof to the Lenders and the Borrower. Such resignation of the
Administrative Agent shall also operate as a resignation as Payments
Administrator. Upon any such resignation, the Required Lenders shall have the
right, upon five days' notice and written approval by the Borrower (which
approval shall not be unreasonably withheld or be required at any time while an
Event of Default exists), to appoint a successor Administrative Agent. If no
successor Administrative Agent (i) shall have been so appointed by the Required
Lenders, and (ii) shall have accepted such appointment, within thirty days after
the retiring Administrative Agent's giving of notice of resignation, then, upon
five days' notice, the retiring Administrative Agent may, on behalf of the
Lenders, appoint a successor Administrative Agent. In the event that no
successor Administrative Agent is appointed pursuant to the foregoing
provisions, the Administrative Agent's resignation shall become effective on the
date which is forty-five days after the retiring Administrative Agent's giving
of notice of resignation, and the Required Lenders shall perform the duties of
the Administrative Agent hereunder.
(b) Each Co-Syndication Agent and each Co-Documentation Agent may,
upon five Business Days' notice to the Borrower, the Administrative Agent and
the Lenders, resign at any time (effective upon the fifth Business Day after the
giving of such notice).
(c) Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative
Agent shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations under
this Credit Agreement and the other Credit Documents.
(d) After any retiring Agent's resignation hereunder as such, the
provisions of this Article 10 shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was an Agent under this Credit Agreement.
10.10 COLLATERAL MATTERS. (a) Each Lender authorizes and directs the
Collateral Agent to enter into the Collateral Documents for the benefit of the
Lenders. Each Lender hereby agrees, and each holder of any Note or participant
in Letters of Credit by the acceptance thereof will be deemed to agree, that,
except as otherwise set forth herein, any action taken by the Required Lenders
in accordance with the provisions of this Credit Agreement or the Collateral
Documents, and the exercise by the Required Lenders, of the powers set forth
herein or therein, together with such other powers as are reasonably incidental
thereto, shall be authorized and binding upon all of the Lenders. The Collateral
Agent is hereby authorized on behalf of all of the Lenders, without the
necessity of any notice to or further consent from any Lender, from time to time
prior to an Event of Default, to take any action with respect to any Collateral
or Collateral Documents which may be necessary to perfect and maintain perfected
the security interest in and Liens upon the Collateral granted pursuant to the
Collateral Documents.
(b) The Lenders hereby authorize the Collateral Agent, at its
option and in its discretion, upon the direction of the Administrative Agent to
release any Lien granted to or held by the Collateral Agent upon any Collateral
(i) upon termination of the Total Commitments and
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payment and satisfaction of all of the Obligations arising under or in respect
of this Credit Agreement and the other Credit Documents, (ii) constituting
property being sold or disposed of as permitted under Section 8.1, upon receipt
by the Collateral Agent of the proceeds of such sale to the extent required by
Section 8.1 or (iii) if approved, authorized or ratified in writing by the
Required Lenders, or, if required by Section 11.10, all of the Lenders. Upon
request by the Administrative Agent at any time, the Lenders will confirm in
writing the Collateral Agent's authority to release particular types or items of
Collateral pursuant to this Section 10.10.
(c) Upon any sale and transfer of Collateral which is expressly
permitted pursuant to the terms of this Credit Agreement, or consented to in
writing by the Required Lenders, or all of the Lenders, as applicable, and upon
at least five (5) Business Days' (or such shorter period as is acceptable to the
Collateral Agent) prior written request by the Borrower, the Collateral Agent
shall (and is hereby irrevocably authorized by the Lenders to) execute such
documents as may be necessary to evidence the release of the Liens granted to
the Collateral Agent for the benefit of the Lenders pursuant to the Collateral
Documents upon the Collateral that was sold or transferred; PROVIDED that (i)
the Collateral Agent shall not be required to execute any such document on terms
which, in the Collateral Agent's opinion, would expose the Collateral Agent to
liability or create any obligation or entail any consequence other than the
release of such Liens without recourse, representation or warranty and (ii) such
release shall not in any manner discharge, affect or impair the Obligations or
any Liens upon (or obligations of Holdings, the Borrower or any of their
respective Subsidiaries in respect of) all interests retained by Holdings, the
Borrower or any of their respective Subsidiaries, including, without limitation,
the proceeds of the sale, all of which shall continue to constitute part of the
Collateral. In the event of any foreclosure or similar enforcement action with
respect to any of the Collateral, the Collateral Agent shall be authorized to
deduct all of the Expenses reasonably incurred by the Collateral Agent from the
proceeds of any such sale, transfer or foreclosure.
(d) The Collateral Agent shall have no obligation whatsoever to
the Lenders or to any other Person to assure that the Collateral exists or is
owned by Holdings, the Borrower or any of their respective Subsidiaries or is
cared for, protected or insured or that the Liens granted to the Collateral
Agent herein or pursuant hereto have been properly or sufficiently or lawfully
created, perfected, protected or enforced or are entitled to any particular
priority, or to exercise or to continue exercising at all or in any manner or
under any duty of care, disclosure or fidelity any of the rights, authorities
and powers granted or available to the Collateral Agent in this Section 10.10 or
in any of the Collateral Documents, it being understood and agreed that in
respect of the Collateral, or any act, omission or event related thereto, the
Collateral Agent may act in any manner it may deem appropriate, in its sole
discretion, given the Collateral Agent's own interest in the Collateral as one
of the Lenders and that the Collateral Agent shall have no duty or liability
whatsoever to the Lenders, except for its gross negligence or willful misconduct
(as determined by a court of competent jurisdiction in a final and
non-appealable decision).
10.11 CO-COLLATERAL AGENTS; SEPARATE COLLATERAL AGENTS. (a) If at
any time or times it shall be necessary or, in the judgment of the Collateral
Agent, desirable, then the Collateral Agent shall be entitled to appoint one or
more sub-collateral agents or co-collateral agents, and in such case the
Collateral Agent, the Borrower and each of the other Credit Parties having an
interest in the Collateral with respect to which such separate or sub-collateral
agent or co-collateral agent is to act shall execute and deliver all instruments
and agreements necessary or
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proper to constitute another bank, trust company or other entity, or one or more
individuals approved by the Collateral Agent, either to act as co-collateral
agent or co-collateral agents jointly with the Collateral Agent originally named
herein or any successor or successors, or to act as a separate or sub-collateral
agent or agents of the Collateral Agent and the Secured Creditors in respect of
any or all of the Collateral. If the Borrower and each of the other Credit
Parties having an interest in the Collateral with respect to which such separate
or sub-collateral agent or co-collateral agent is to act shall not have joined
in the execution of such instruments or agreements within 10 days after the
receipt of a written request from the Collateral Agent so to do, or if a Default
or an Event of Default shall be continuing, the Collateral Agent may act under
the foregoing provisions of this Section 10.11 without the concurrence of the
Borrower or any other Credit Party, and the Borrower and each of the other
Credit Parties hereby irrevocably appoint the Collateral Agent as their agent
and attorney to act for them under the foregoing provisions of this Section
10.11 in either of such contingencies.
(b) Every separate or sub-collateral agent (and all references
herein to a "separate collateral agent" shall be deemed to refer also to a
"sub-collateral agent" or a "collateral sub-agent") and every co-collateral
agent, other than any collateral agent which may be appointed as successor to
any Collateral Agent, shall, to the extent permitted by applicable law, be
appointed and act and be such, subject to the following provisions and
conditions, namely:
(i) all rights, remedies, powers, duties and obligations conferred
upon, reserved to or imposed upon the Collateral Agent hereunder shall
be conferred, reserved or imposed and exercised or performed by the
Collateral Agent and such separate collateral agent or separate
collateral agents or co-collateral agent or co-collateral agents,
jointly or severally, as shall be provided in the instrument appointing
such separate collateral agent or separate collateral agents or
co-collateral agent or co-collateral agents, except to the extent that,
under any law of any jurisdiction in which any particular act or acts
are to be performed, the Collateral Agent shall be incompetent or
unqualified to perform such act or acts, in which event such rights,
remedies, powers, duties and obligations shall be exercised and
performed by such separate collateral agent or separate collateral
agents or co-collateral agent or co-collateral agents;
(ii) no power given hereby to, or which it is provided hereby may
be exercised by, any such separate collateral agent or separate
collateral agents or co-collateral agent or co-collateral agents shall
be exercised hereunder by such separate collateral agent or separate
collateral agents or co-collateral agent or co-collateral agents except
(subject to applicable law) jointly with, or with the consent or at the
direction in writing of, the Collateral Agent;
(iii) all provisions of this Credit Agreement and any relevant
Collateral Document relating to the Collateral Agent or to releases of
Collateral shall apply to any such separate collateral agent or
separate collateral agents or co-collateral agent or co-collateral
agents;
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(iv) no collateral agent constituted under this Section 10.11 shall
be personally liable by reason of any act or omission of any other
separate or co-collateral agent or the Collateral Agent hereunder; and
(v) the Collateral Agent at any time by an instrument in writing,
executed by it, may accept the resignation of any such separate
collateral agent or co-collateral agent and the Collateral Agent or the
Required Lenders may individually or jointly remove any such separate
collateral agent or co-collateral agent, and in that case, by an
instrument in writing executed by the Collateral Agent or the Required
Lenders, as the case may be, and the Collateral Agent or the Required
Lenders, as the case may be, may appoint a successor to such separate
collateral agent or co-collateral agent, as the case may be, anything
herein contained to the contrary notwithstanding. If the Borrower and
each of the other Credit Parties shall not have joined in the execution
of any such instrument within 10 days after the receipt of a written
request from the Collateral Agent so to do, or if a Default or an Event
of Default shall be continuing, the Collateral Agent shall have the
power to accept the resignation of or remove any such separate
collateral agent or co-collateral agent and to appoint a successor to
such separate collateral agent or co-collateral agent, as the case may
be, and to execute any such instrument without the concurrence of the
Borrower or any other Credit Party, and the Borrower and each of the
other Credit Parties hereby irrevocably appoint the Collateral Agent
their agent and attorney to act for them in such connection in either
of such contingencies. If the Collateral Agent shall have appointed a
separate collateral agent or separate collateral agents or
co-collateral agent or co-collateral agents as above provided, the
Collateral Agent may at any time, by an instrument in writing, accept
the resignation of or remove any such separate collateral agent or
co-collateral agent, the successor to any such separate collateral
agent or co-collateral agent to be appointed by the Borrower and each
of the other Credit Parties and the Collateral Agent, or by the
Collateral Agent alone, as hereinabove provided in this Section 10.11.
(c) Without limiting the foregoing, each of the parties to this
Credit Agreement (and each other Credit Party) hereby agrees to the appointment
of BTCC, as sub-collateral agent of the Collateral Agent, for the purposes set
forth in Section 10.15 of the U.S. Security Agreement.
10.12 ACTIONS WITH RESPECT TO DEFAULTS. In addition to the
Administrative Agent's right to take actions on its own accord as permitted
under this Credit Agreement, the Administrative Agent shall take such action
with respect to an Event of Default as shall be directed by the Required
Lenders; PROVIDED that, until the Administrative Agent shall have received such
directions, the Administrative Agent may (but shall not be obligated to) take
such action, or refrain from taking such action, with respect to such Event of
Default as it shall deem advisable and in the best interests of the Lenders.
10.13 DELIVERY OF INFORMATION. No Agent shall be required to deliver
to any Lender originals or copies of any documents, instruments, notices,
communications or other information received by such Agent from Holdings, the
Borrower, any Subsidiary, the Required Lenders, any Lender or any other Person
under or in connection with this Credit Agreement or any
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other Credit Document except (i) as specifically provided in this Credit
Agreement or any other Credit Document and (ii) as specifically requested from
time to time in writing by any Lender with respect to a specific document,
instrument, notice or other written communication received by and in the
possession of the Administrative Agent at the time of receipt of such request
and then only in accordance with such specific request.
10.14 THE CO-SYNDICATION AGENTS AND THE CO-DOCUMENTATION AGENTS.
Notwithstanding any other provision of this Credit Agreement or any provision of
any other Credit Document, each Co-Syndication Agent and each Co-Documentation
Agent are named as such for recognition purposes only, and in their respective
capacities as such shall have no powers, rights, duties, responsibilities or
liabilities with respect to this Credit Agreement or the other Credit Documents
or the transactions contemplated hereby and thereby. Without limitation of the
foregoing, neither Co-Syndication Agent, and neither Co-Documentation Agent,
shall, solely by reason of this Credit Agreement or any other Credit Document,
have any fiduciary relationship in respect of any Lender or any other Person.
ARTICLE 11
MISCELLANEOUS
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11.1 SUBMISSION TO JURISDICTION; WAIVERS. Each of Holdings and the
Borrower hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Credit Agreement and the other Credit Documents to
which it is a party, or for recognition and enforcement of any judgment in
respect thereof, to the non-exclusive general jurisdiction of the courts of the
State of New York located in the County of New York, the Courts of the United
States of America for the Southern District of New York and appellate courts
from any thereof;
(b) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to the
venue of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to Holdings
or the Borrower, as applicable, at its address set forth in Section 11.5 or at
such other address for such Persons which the Administrative Agent shall have
been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the right
to ▇▇▇ in any other jurisdiction;
(e) to the extent permitted by law, waives the right to assert any
setoff, counterclaim or cross-claim in respect of, and all statutes of
limitations which may be relevant to, such action or proceeding (other than
compulsory counterclaims), PROVIDED that nothing in this clause (e) shall
preclude a separate action asserting any such claims; and
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(f) waives due diligence, demand, presentment and protest and any
notices thereof as well as notice of nonpayment.
11.2 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES ANY
RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF THIS CREDIT
AGREEMENT, THE CREDIT DOCUMENTS OR ANY OTHER AGREEMENTS OR TRANSACTIONS RELATED
HERETO OR THERETO.
11.3 GOVERNING LAW. THE VALIDITY, INTERPRETATION AND ENFORCEMENT OF
THIS CREDIT AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK
(WITHOUT REGARD TO CONFLICT OF LAWS PROVISIONS).
11.4 DELAYS: PARTIAL EXERCISE OF REMEDIES. No delay or omission of
any Agent, the Issuing Lender or the Lenders to exercise any right or remedy
hereunder, whether before or after the occurrence of any Event of Default, shall
impair any such right or shall operate as a waiver thereof or as a waiver of any
such Event of Default. No single or partial exercise by any Agent, the Issuing
Lender or the Lenders of any right or remedy shall preclude any other or further
exercise thereof, or preclude any other right or remedy.
11.5 NOTICES. Except as otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, telecopier or cable communication) and mailed,
telegraphed, telexed, telecopied, cabled or delivered: if to any Credit Party,
at the address specified opposite its signature below or in the other relevant
Credit Documents; if to any Lender, at its address specified on Schedule II; and
if to the Administrative Agent or the Payments Administrator, at the address set
forth in the definition of "Payment Office" contained in this Credit Agreement;
or, as to any Credit Party or the Administrative Agent, at such other address as
shall be designated by such party in a written notice to the other parties
hereto and, as to each Lender, at such other address as shall be designated by
such Lender in a written notice to the Borrower and the Administrative Agent.
All such notices and communications shall, when mailed, telegraphed, telexed,
telecopied, or cabled or sent by overnight courier, be effective when deposited
in the mails, delivered to the telegraph company, cable company or overnight
courier, as the case may be, or sent by telex or telecopier, except that notices
and communications to the Administrative Agent or any Credit Party shall not be
effective until received by the Administrative Agent or such Credit Party.
11.6 BENEFIT OF AGREEMENT. (a) This Credit Agreement shall be
binding upon and inure to the benefit of and be enforceable by the respective
successors and assigns of the parties hereto, PROVIDED that the Borrower may not
assign or transfer any of its interests hereunder, without the prior written
consent of the Lenders and PROVIDED FURTHER, that the rights of each Lender to
transfer, assign or grant participations in its rights and/or obligations
hereunder shall be limited as set forth below in this Section 11.6, PROVIDED
that (i) nothing in this Section 11.6 shall prevent or prohibit any Lender from
pledging its rights under this Credit Agreement and/or its Loans and/or Notes
hereunder to a Federal Reserve Bank in support of borrowings made by such Lender
from such Federal Reserve Bank and (ii) with prior notification to the
Administrative Agent and the Borrower (but without the consent of the
Administrative Agent or the Borrower), any Lender which is a fund may pledge all
or any portion of its Loans and Notes
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to its trustee or to a collateral agent providing credit or credit support to
such Lender in support of its obligations to its trustee or such collateral
agent, as the case may be. No pledge pursuant to last proviso in the immediately
preceding sentence shall release the transferor Lender from any of its
obligations hereunder.
(b) Each Lender shall have the right to transfer, assign or grant
participations in all or any part of its remaining rights and obligations
hereunder on the basis set forth below in this clause (b).
(A) ASSIGNMENTS. Each Lender may assign pursuant to an Assignment
and Assumption Agreement substantially in the form of Exhibit Q-1
hereto all or a portion of its rights and obligations hereunder
pursuant to this clause (b)(A) to (x)(i) its parent company and/or any
affiliate of such Lender which is at least 50% owned by such Lender or
its parent company, (ii) one or more Lenders or (iii) any fund that
invests in bank loans and is managed or advised by the same investment
advisor of a Lender or by an Affiliate of such investment advisor or
(y) one or more other Eligible Transferees (treating any fund that
invests in loans and any other fund that invests in loans and is
managed or advised by the same investment advisor of such fund or by an
Affiliate of such investment advisor as a single Eligible Transferee),
PROVIDED that any assignments of Revolving Credit Commitments pursuant
to clause (x) above shall require the consent of each Issuing Lender,
which consents shall not be unreasonably withheld or delayed; PROVIDED
FURTHER that any assignments pursuant to clause (y) above shall be in
the aggregate amount of at least $1,000,000 (or, in each case, if less,
the entire amount of the assigning Lender's Commitments and outstanding
Loans at such time), and shall require the consents of (i) the
Administrative Agent, (ii) in connection with any assignment of all or
any portion of Total Revolving Credit Commitments, each Issuing Lender
and (iii) when no Default under Section 9.1(a) or 9.1(e) then exists
and no Event of Default then exists, the Borrower, each of which
consents shall not be unreasonably withheld or delayed. Any assignment
to another Lender pursuant to this clause (b)(A) will become effective
upon the payment to the Payments Administrator by either the assigning
or the assignee Lender of a nonrefundable assignment fee of $3,500
(provided that (i) no such fee shall be payable in the event of
assignments from any Lender to a fund that invests in loans and is
managed or advised by the same investment advisor as such assigning
Lender (or by an Affiliate of such investment advisor) and (ii)
contemporaneous assignments by a Lender to two or more Eligible
Transferees that are funds that invest in loans which are managed or
advised by the same investment advisor (or an Affiliate thereof) shall
be treated as one assignment for the purposes of the aforementioned
assignment fee) and the recording by the Payments Administrator of such
assignment, and the resultant effects thereof on the Loans and
Commitments of the assigning Lender and the assignee Lender, in a
register maintained by the Payments Administrator as agent of the
Borrower for this purpose (the "REGISTER"), the Payments Administrator
hereby agreeing to effect such recordation no later than five Business
Days after its receipt of a written notification by the assigning
Lender and the assignee Lender of the proposed assignment. Assignments
pursuant to clause (b)(A) will only be effective if the Payments
Administrator shall have received a written notice in the form of
Exhibit Q-2 hereto from the assigning Lender and the assignee. No later
than five Business Days after its receipt of such written notice, the
Payments Administrator will record such assignment, and the
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resultant effects thereof on the Loans and Commitments of the assigning
Lender, in the Register, at which time such assignment shall become
effective. Notwithstanding the foregoing, the Payments Administrator
may, but shall not be required to, record any assignment in the
Register on or after the date on which any proposed amendment,
modification or supplement in respect of this Credit Agreement has been
circulated to the Lenders for approval until the earlier of (x) the
effectiveness of such amendment, modification or supplement in
accordance with Section 11.10 or (y) 30 days following the date on
which such proposed amendment, modification or supplement was
circulated to the Lenders. Upon the effectiveness of any assignment
pursuant to clause (b)(A)(y), (x) the assignee will become a "Lender"
for all purposes of this Credit Agreement and the other Credit
Documents with the Loans and a Commitment as so recorded by the
Payments Administrator in the Register, and to the extent of such
assignment, the assigning Lender shall be relieved of its obligations
hereunder with respect to the portion of its Commitment being assigned
and (y) the Borrower shall issue new Notes (in exchange for the Note or
Notes of the assigning Lender) to the assigning Lender (to the extent
such Lender's Commitments and outstanding Loans are not reduced to zero
as a result of such assignment) and to the assignee Lender, in each
case to the extent requested by the assigning Lender or assignee
Lender, as the case may be, to the extent needed to reflect the revised
Commitments of such Lenders. The Payments Administrator will (x) notify
the Issuing Lender with respect to outstanding Letters of Credit within
5 Business Days of the effectiveness of any assignment hereunder and
(y) prepare on the last Business Day of each calendar quarter during
which an assignment has become effective pursuant to this clause (b)(A)
a new Schedule I giving effect to all such assignments effected during
such quarter and will promptly provide same to the Borrower and each of
the Lenders. To the extent that an assignment of all or any portion of
a Lender's rights and obligations hereunder would, at the time of such
assignment, result in increased payment obligations under Section 2.9,
4.5 or 4.11 from those being charged by the respective assigning Lender
prior to such assignment, then the Borrower shall not be obligated to
pay such increased amounts (although the Borrower shall be obligated to
pay any other increased amounts of the type described above resulting
from changes after the date of the respective assignment). The Borrower
agrees to indemnify the Payments Administrator from and against any and
all losses, claims, damages and liabilities of whatsoever nature which
may be imposed on, asserted against or incurred by the Payments
Administrator in performing its duties under this Section 11.6 other
than those resulting from the Payments Administrator's willful
misconduct or gross negligence (as determined by a court of competent
jurisdiction in a final and unappealable decision).
(B) PARTICIPATIONS. Each Lender may transfer, grant or assign
participations in all or any part of such Lender's interests and
obligations hereunder pursuant to this clause (b)(B) to any Eligible
Transferee, PROVIDED that (i) such Lender shall remain a "Lender" for
all purposes of this Credit Agreement and the transferee of such
participation shall not constitute a Lender hereunder, (ii) no
participant under any such participation shall have rights to approve
any amendment to or waiver of this Credit Agreement or any other Credit
Document except to the extent such amendment or waiver would (x) extend
the final scheduled maturity of any of the Loans or the Commitments in
which such participant is participating (it being understood that a
waiver of a mandatory reduction in the Total Commitments or the waiver
of the application of any prepayment to the Loans
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shall not constitute the extension of the final scheduled maturity of
any Loan or Commitment), (y) reduce the interest rate (other than as a
result of waiving the applicability of any post-default increases in
interest rates) or Fees or postpone the payment or reduce the amount
thereof or (z) release all or substantially all of the Collateral
(except as expressly provided in the Credit Documents) and (iii) the
Borrower, the Administrative Agent and the other Lenders shall continue
to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Credit Agreement. In the
case of any such participation, the participant shall not have any
rights under this Credit Agreement or any of the other Credit Documents
(the participant's rights against the granting Lender in respect of
such participation to be those set forth in the agreement with such
Lender creating such participation) and all amounts payable by the
Borrower hereunder shall be determined as if such Lender had not sold
such participation, PROVIDED that such participant shall be entitled to
receive additional amounts under Sections 2.9, 2.10, 4.5 and 4.11 on
the same basis as if it were a Lender to the extent that the Lender
granting such participation would be entitled to such benefits if the
participation had not been made. In addition, each agreement creating
any participation must include an agreement by the participant to be
bound by the provisions of Section 11.7 of this Credit Agreement.
(c) Notwithstanding any other provisions of this Section 11.6, no
transfer or assignment of the interests or obligations of any Lender hereunder
or any grant of participations therein shall be permitted if such transfer,
assignment or grant would require the Borrower to file a registration statement
with the SEC or to qualify the Loans under the "Blue Sky" laws of any State.
(d) (I) If any Lender becomes a Defaulting Lender, (II) upon the
occurrence of any event giving rise to the operation of Section 2.9, 4.3(c)(ii)
or 4.11 with respect to such Lender (and not other Lenders generally) or (III)
in the case of a refusal by a Lender to consent to certain proposed changes,
waivers, discharges or terminations with respect to this Agreement which have
been approved by the Required Lenders as (and to the extent) provided in Section
11.10(a), the Borrower shall have the right, with the consents of the
Administrative Agent and each Issuing Lender (which consents shall not be
unreasonably withheld), if no Default or Event of Default then exists to replace
such Lender (the "REPLACED LENDER"), either in whole or, if such Lender is both
a Revolving Credit Lender and a Term Loan Lender, with respect to its Revolving
Credit Commitment (and related Obligations) only or its Term Loan Outstandings
(and related Term Loan Commitment) only, in each case at the option of the
Borrower, with one or more Eligible Transferees (collectively, the "REPLACEMENT
LENDER"), PROVIDED that (i) at the time of any replacement pursuant to this
Section 11.6(d), the Replacement Lender shall enter into one or more Assignment
and Assumption Agreements pursuant to Section 11.6(b)(A) (and with all fees
payable pursuant to said Section 11.6(b)(A) to be paid by the Replacement
Lender) pursuant to which the Replacement Lender shall acquire (x) the Revolving
Credit Commitment and related outstanding Revolving Loans of, and participations
in Letters of Credit by, the Replaced Lender, in instances where a Revolving
Credit Lender is being replaced, and (y) the Term Loan Commitment (if same
remains in effect) and the outstanding Term Loans of the Replaced Lender, in
instances where a Term Loan Lender is being replaced and, in each case in
connection therewith, shall pay to (x) the Replaced Lender in respect thereof an
amount equal to the sum of (A) an amount equal to the principal of, and all
accrued interest on, all outstanding Loans of the
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Replaced Lender (or the Revolving Loans or Term Loans, as the case may be, of
the Replaced Lender if only such Loans are being acquired pursuant to the
respective replacement), (B) in the case of any replacement of a Revolving
Credit Lender, an amount equal to all drawings under Letters of Credit that have
been funded by (and not reimbursed to) such Replaced Lender, together with all
then unpaid interest with respect thereto at such time, (C) an amount equal to
the increased costs incurred by the Borrower and owing to the Replaced Lender
(or, if the respective Replaced Lender is both a Revolving Credit Lender and a
Term Loan Lender, and is only being replaced with respect to a single such
Tranche, the respective increased costs owing with respect thereto) pursuant to
Sections 2.9 and 4.11 and (D) an amount equal to all accrued, but theretofore
unpaid, Fees owing to the Replaced Lender (or, if the respective Replaced Lender
is both a Revolving Credit Lender and a Term Loan Lender, and is only being
replaced with respect to a single such Tranche, the Fees owing with respect to
such Tranche) pursuant to Article 4 and (y) in the case of any replacement of a
Revolving Credit Lender, the Issuing Lender the amount of all unreimbursed
drawings under Letters of Credit attributable to such Replaced Lender and (ii)
all obligations of the Borrower owing to the Replaced Lender (other than (x)
those specifically described in clause (i) above in respect of which the
assignment purchase price has been, or is concurrently being, paid and (y) if
the respective Replaced Lender is both a Revolving Credit Lender and a Term Loan
Lender and is only being replaced with respect to a single such Tranche,
obligations relating to the Tranche with respect to which such Lender is not
being replaced) shall be paid in full by the Borrower to such Replaced Lender
concurrently with such replacement. Upon the execution of the respective
Assignment and Assumption Agreements the payment of amounts referred to in
clauses (i) and (ii) above the Replacement Lender shall become a Lender
hereunder and the Replaced Lender shall cease to constitute a Lender hereunder
(unless such Lender was both a Revolving Credit Lender and a Term Loan Lender
hereunder, and was only replaced with respect to a single such Tranche), except
with respect to indemnification provisions under this Credit Agreement, which
shall survive as to such Replaced Lender.
(e) Each Lender party to this Credit Agreement on the Effective
Date hereby represents, and each Person that becomes a Lender pursuant to an
assignment permitted by the preceding clause (b)(A) will upon its becoming party
to this Credit Agreement represent, that it is an Eligible Transferee which
makes or acquires loans in the ordinary course of its business and that it will
make or acquire the Loans for its own account in the ordinary course of such
business, PROVIDED that subject to the preceding clauses (a) through (d), the
disposition of any promissory notes or other evidences of or interests in
Indebtedness held by such Lender shall at all times be within its exclusive
control.
11.7 CONFIDENTIALITY. Subject to Section 11.6, the Lenders shall
hold all non-public information obtained pursuant to the requirements of this
Credit Agreement which has been identified as such by Holdings or the Borrower
in accordance with such Lenders' customary procedure for handling confidential
information of this nature and in accordance with safe and sound banking
practices and in any event may make disclosure to its Affiliates, employees,
auditors, advisors, or counsel in connection with the evaluation or
administration of the Loans or as reasonably required by any BONA FIDE actual or
potential transferee or participant in connection with the contemplated transfer
of any Loans or participation therein, or by any direct or indirect contractual
counterparty in swap agreements or such contractual counterparty's professional
advisor (so long as such transferee or participant, or such contractual
counterparty
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or professional advisor, as the case may be, agrees to be bound by the
provisions of this Section 11.7), or as required or requested by any
governmental agency or representative thereof or pursuant to legal process,
PROVIDED that, unless specifically prohibited by applicable law or court order,
each Lender shall use its reasonable best efforts (in accordance with customary
banking procedures) to notify Holdings or the Borrower of any request by any
governmental agency or representative thereof (other than any such request in
connection with an examination of the financial condition of such Lender by such
governmental agency) for disclosure of any such non-public information prior to
disclosure of such information, and PROVIDED FURTHER, that in no event shall any
Lender be obligated or required to return any materials furnished by Holdings,
the Borrower or any of their respective Subsidiaries.
11.8 INDEMNIFICATION. (a) Each of Holdings and the Borrower shall,
jointly and severally, and hereby agrees to jointly and severally, indemnify,
defend and hold harmless each Agent, the Issuing Lender and each of the Lenders
and their respective directors, officers, agents and employees (the
"INDEMNITEES") from and against (x) any and all losses, claims, damages,
liabilities or expenses incurred by any of them (except to the extent that it is
finally judicially determined to have resulted from the gross negligence or
willful misconduct of the respective Indemnitee (as determined by a court of
competent jurisdiction in a final and unappealable decision)) arising out of or
by reason of any litigations, investigations, claims or proceedings which arise
out of or are in any way related to (i) this Credit Agreement, the other Credit
Documents or the transactions contemplated thereby, (ii) the issuance of the
Letters of Credit, (iii) any actual or proposed use by the Borrower of the
proceeds of the Loans or (iv) the Agents' or the Lenders' entering into this
Credit Agreement, the other Credit Documents or any other agreements and
documents relating hereto, including, without limitation, amounts paid in any
settlement agreed to by Holdings or the Borrower, court costs and the reasonable
fees and disbursements of counsel incurred in connection with any such
litigation, investigation, claim or proceeding or any advice rendered in
connection with any of the foregoing (whether or not such lender is a party
thereto) and (y) any such losses, claims (including Environmental Claims),
damages, liabilities, deficiencies, judgments, fees and disbursements (including
reasonable attorneys' and consultants' fees and disbursements) or expenses
incurred in connection with any removal, remedial or other action under any
Environmental Laws taken by Borrower or any of the Lenders (except to the extent
resulting from the gross negligence or willful misconduct of the respective
Indemnitee (as determined by a court of competent jurisdiction in a final and
unappealable decision)) or in connection with compliance by Holdings, the
Borrower or any of their respective Subsidiaries, or any of their respective
properties, with any Environmental Laws or in connection with the actual or
alleged presence of Hazardous Materials on any property of the Borrower.
(b) If and to the extent that the Obligations of either Holdings
or the Borrower under this Section 11.8 are unenforceable for any reason, each
of Holdings and the Borrower hereby agrees to make the maximum contribution to
the payment and satisfaction of such Obligations which is permissible under
applicable law. Each of Holdings' and the Borrower's Obligations hereunder shall
survive any termination of this Credit Agreement and the other Credit Documents
and the payment in full of the Obligations, and are in addition to, and not in
substitution of, any other of their Obligations set forth in this Credit
Agreement.
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(c) In addition, each of Holdings and the Borrower shall, upon
demand, pay to each Agent and any Lender all costs and expenses (including the
reasonable fees and disbursements of counsel and other professionals) paid or
incurred by such Agent or such Lender in (i) enforcing or defending its rights
under or in respect of this Credit Agreement, the other Credit Documents or any
other document or instrument now or hereafter executed and delivered in
connection herewith, (ii) in collecting the Loans, (iii) in foreclosing or
otherwise collecting upon the Collateral or any part thereof and (iv) obtaining
any legal, accounting or other advice in connection with any of the foregoing.
11.9 ENTIRE AGREEMENT; SUCCESSORS AND ASSIGNS. This Credit
Agreement and the other Credit Documents constitute the entire agreement among
Holdings, the Borrower, the Administrative Agent and the Lenders, and supersedes
any prior agreements among them (other than the Fee Letter, which remains in
effect), and shall bind and benefit Holdings, the Borrower, the Administrative
Agent and the Lenders and their respective successors and permitted assigns.
11.10 AMENDMENT OR WAIVER. (a) Subject to the provisions of
following clause (c), neither this Credit Agreement nor any other Credit
Document nor any terms hereof or thereof may be changed, waived, discharged or
terminated unless such change, waiver, discharge or termination is in writing
signed by the respective Credit Parties party hereto or thereto and the Required
Lenders, PROVIDED that no such change, waiver, discharge or termination shall,
without the consent of each Lender (other than a Defaulting Lender) (with
Obligations being directly affected in the case of following clause (i)), (i)
extend the final scheduled maturity of any Loan or Note (it being understood
that any waiver of the application of any prepayment or the method of
application of any prepayment to the Loans or Notes or any mandatory reduction
to the commitments shall not constitute an extension of the final maturity date
of such Loan or Note) or extend the stated expiration date of any Letter of
Credit beyond the Maturity Date, or reduce the rate or extend the time of
payment of interest or Fees thereon (except in connection with the waiver of
applicability of any post-default increase in interest rates), or reduce the
principal amount thereof (it being understood that any amendment or modification
to the financial definitions in this Agreement or to Section 1.2 shall not
constitute a reduction in the rate of interest or Fees for the purposes of this
clause (i)), (ii) release all or substantially all of the Collateral (except as
expressly provided in the Credit Documents), (iii) amend, modify or waive any
provision of this Section 11.10 (except for technical amendments with respect to
additional extensions of credit pursuant to this Agreement which afford the
protections to such additional extensions of credit of the type provided to the
Term Loans and the Revolving Credit Commitments on the Effective Date), (iv)
reduce the respective percentage specified in the definition of Required Lenders
or Aggregate Supermajority Lenders (it being understood that, with the consent
of the Required Lenders, additional extensions of credit pursuant to this Credit
Agreement may be included in the determination of the Required Lenders or the
Aggregate Supermajority Lenders, as the case may be, on substantially the same
basis as the extensions of Term Loans and Revolving Credit Commitments are
included on the Effective Date) or (v) consent to the assignment or transfer by
the Borrower of any of its rights and obligations under this Credit Agreement;
PROVIDED FURTHER, that no such change, waiver, discharge or termination shall
(1) increase the Commitments of any Lender over the amount thereof then in
effect without the consent of such Lender (it being understood that waivers or
modifications of conditions precedent, covenants, Defaults or Events of Default
or of a mandatory reduction in the Total Commitments shall not constitute an
increase of the Commitment of any Lender, and that an
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increase in the available portion of any Commitment of any Lender shall not
constitute an increase of the Commitment of such Lender), (2) without the
consent of the Issuing Lender, amend, modify or waive any provision of Article 3
or alter its rights or obligations with respect to Letters of Credit, (3)
without the consent of Collateral Agent, amend, modify or waive any provision
relating to the rights or obligations of the Collateral Agent, (4) without the
consent of the Administrative Agent, amend, modify or waive any provision of
Article 10 or any other provision as same relates to the rights or obligations
of the Administrative Agent, (5) without the consent of the Majority Lenders of
each Tranche which is being allocated a lesser prepayment, repayment or
commitment reduction as a result of the actions described below (or without the
consent of the Majority Lenders of each Tranche in the case of an amendment to
the definition of Majority Lenders), amend the definition of Majority Lenders or
alter the required application of any prepayments or repayments (or commitment
reductions), as between the various Tranches, pursuant to Section 2.5 (excluding
Section 2.5(a)) (although the Required Lenders may (i) waive in whole or in
part, any such prepayment, repayment or commitment reduction, so long as the
application as amongst the various Tranches of any such prepayment, repayment or
commitment reduction which is still required to be made is not altered and (ii)
agree to inclusion of additional extensions of credit made after the Initial
Borrowing Date (and not pursuant to commitments as in effect on the Initial
Borrowing Date) on substantially the same basis as other extensions of credit,
pursuant to Section 2.5), (6) without the consent of the Supermajority Lenders
of the respective Tranche, amend, modify or waive any Scheduled Repayment
(except that no such consent of the Supermajority Lenders of the affected
Tranche shall be required in connection with any increase in the Scheduled
Repayments of such affected Tranche (including, without limitation, as a result
of the making of additional Loans pursuant to a given Tranche which has the
effect of increasing the Scheduled Repayments of such affected Tranche on a
proportionate basis)) or (7) without the consent of the Aggregate Supermajority
Lenders (i) increase any percentage specified in the definition of Adjusted Net
Book Value Percentage or specified in Section 2.2(a)(ii)(B), in any such case
above the respective percentage set forth in such definition or such Section, as
the case may be, on the Effective Date, (ii) increase the sum of the aggregate
principal amount of outstanding Term Loans plus the Total Revolving Credit
Commitments to an amount in excess of $700,000,000 or (iii) release any
Subsidiary Guarantor from its respective Subsidiaries Guaranty (except as
expressly provided in Section 8.1(c) or in the respective Subsidiaries
Guaranty).
(b) If, in connection with any proposed change, waiver, discharge
or termination of any of the provisions of this Credit Agreement as contemplated
by clauses (i) through (v), inclusive, of the first proviso to Section 11.10(a),
the consent of the Required Lenders is obtained but the consent of one or more
of such other Lenders whose consent is required is not obtained, then the
Borrower shall have the right, so long as all non-consenting Lenders whose
individual consent is required are treated as described in either clauses (A) or
(B) below, to either (A) replace each such non-consenting Lender or Lenders with
one or more Replacement Lenders pursuant to Section 11.6(d) so long as at the
time of such replacement, each such Replacement Lender consents to the proposed
change, waiver, discharge or termination or (B) terminate such non-consenting
Lender's Commitments
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and/or repay the respective Tranche or Tranches of outstanding Loans of such
Lender giving rise to such non-consenting Lender's right to consent to such
proposed change, waiver, discharge or termination, PROVIDED that, unless the
Commitments that are terminated, and Loans repaid, pursuant to preceding clause
(B) are immediately replaced in full at such time through the addition of new
Lenders or the increase of the Commitments and/or outstanding Loans of existing
Lenders (who in each case must specifically consent thereto), then in the case
of any action pursuant to preceding clause (B) the Required Lenders (determined
after giving effect to the proposed action) shall specifically consent thereto,
PROVIDED FURTHER, that in any event the Borrower shall not have the right to
replace a Lender, terminate its Commitments or repay its Loans solely as a
result of the exercise of such Lender's rights (and the withholding of any
required consent by such Lender) pursuant to the second proviso to Section
11.10(a).
(c) Notwithstanding anything to the contrary contained above in
this Section 11.10, (x) additional Subsidiaries may become parties to the
various Credit Documents as contemplated herein and therein (which shall not
require the approval of any other Credit Parties or Lenders), (y) amendments and
modifications to the Credit Documents, in connection with any conversion
effected in accordance with the requirements of Section 11.20, may be made as
contemplated therein (with the consent of the Administrative Agent and/or
Collateral Agent, as appropriate) and (z) amendments and modifications to the
Collateral Documents in connection with the provision of any Incremental
Commitments by Incremental Lenders may be made as contemplated in Section
2.1(e)(ii) (with the consent of the Administrative Agent and/or the Collateral
Agent, as appropriate).
11.11 NONLIABILITY OF ADMINISTRATIVE AGENT AND LENDERS. The
relationship between Holdings, the Borrower and their respective Subsidiaries,
on the one hand, and the Lenders and the Administrative Agent, on the other
hand, shall be solely that of debtors and creditors. Neither the Administrative
Agent nor any Lender shall have any fiduciary responsibilities to Holdings, the
Borrower, or any of their respective Subsidiaries. Neither the Administrative
Agent or any Lender undertakes any responsibility to Holdings, the Borrower, or
any of their respective Subsidiaries to review or inform Holdings, the Borrower,
or any of their respective Subsidiaries of any matter in connection with any
phase of the business or operations of Holdings, the Borrower, or any of their
respective Subsidiaries.
11.12 INDEPENDENT NATURE OF LENDERS' RIGHTS. The amounts payable at
any time hereunder to each Lender under such Lender's Note or Notes shall be a
separate and independent debt.
11.13 COUNTERPARTS. This Credit Agreement may be executed in any
number of counterparts and by the different parties hereto in separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument.
11.14 EFFECTIVENESS. This Credit Agreement shall become effective on
the date (the "EFFECTIVE DATE") on which (i) Holdings, the Borrower, the Lenders
and the Administrative Agent shall have signed a counterpart hereof (whether the
same or different counterparts) and shall have delivered the same (including by
way of facsimile transmission) to the Administrative Agent and (ii) the
conditions contained in Sections 5.1 and 5.2 are met to the satisfaction of the
Administrative Agent and the Required Lenders. Unless the Administrative Agent
has received actual notice from any Lender that the conditions contained in
Sections 5.1 and 5.2 have not been met, upon the satisfaction of the condition
described in clause (i) of the immediately preceding sentence and upon the
Administrative Agent's good faith determination that the conditions
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described in clause (ii) of the immediately preceding sentence have been met,
then the Effective Date shall have been deemed to have occurred, regardless of
any subsequent determination that one or more of the conditions thereto had not
been met. The Administrative Agent will give the Borrower and each Lender prompt
written notice of the occurrence of the Effective Date.
11.15 HEADINGS DESCRIPTIVE. The headings of the several sections and
subsections of this Credit Agreement, and the Table of Contents, are inserted
for convenience only and shall not in any way affect the meaning or construction
of any provision of this Credit Agreement.
11.16 MAXIMUM RATE. Notwithstanding anything to the contrary
contained elsewhere in this Credit Agreement or in any other Credit Document,
the Borrower, the Administrative Agent and the Lenders hereby agree that all
agreements among them under this Credit Agreement and the other Credit
Documents, whether now existing or hereafter arising and whether written or
oral, are expressly limited so that in no contingency or event whatsoever shall
the amount paid, or agreed to be paid, to the Administrative Agent or any Lender
for the use, forbearance, or detention of the money loaned to the Borrower and
evidenced hereby or thereby or for the performance or payment of any covenant or
obligation contained herein or therein, exceed the Highest Lawful Rate. If due
to any circumstance whatsoever, fulfillment of any provisions of this Credit
Agreement or any of the other Credit Documents at the time performance of such
provision shall be due shall exceed the Highest Lawful Rate, then,
automatically, the obligation to be fulfilled shall be modified or reduced to
the extent necessary to limit such interest to the Highest Lawful Rate, and if
from any such circumstance and Lender should ever receive anything of value
deemed interest by applicable law which would exceed the Highest Lawful Rate,
such excessive interest shall be applied to the reduction of the principal
amount then outstanding hereunder or on account of any other then outstanding
Obligations and not to the payment of interest, or if such excessive interest
exceeds the principal unpaid balance then outstanding hereunder and such other
then outstanding Obligations, such excess shall be refunded to the Borrower. All
sums paid or agreed to be paid to the Administrative Agent or any Lender for the
use, forbearance, or detention of the Obligations and other Indebtedness of the
Borrower to the Administrative Agent or any Lender shall, to the extent
permitted by applicable law, be amortized, prorated, allocated and spread
throughout the full term of such Indebtedness until payment in full so that the
actual rate of interest on account of all such Indebtedness does not exceed the
Highest Lawful Rate throughout the entire term of such Indebtedness. The terms
and provisions of this Section 11.16 shall control every other provision of this
Credit Agreement and all agreements among the Borrower, the Administrative Agent
and the Lenders.
11.17 RIGHT OF SETOFF. In addition to and not in limitation of all
rights of offset that any Lender or the Issuing Lender may have under applicable
law, each Lender and the Issuing Lender shall, upon the occurrence of any Event
of Default and whether or not such Lender or such Issuing Lender has made any
demand or the Obligations of any Credit Party are matured, have the right, upon
prior notice to Holdings or the Borrower, to appropriate and apply to the
payment of the Obligations of Holdings or the Borrower or any of their
respective Subsidiaries all deposits (general or special, time or demand,
provisional or final) then or thereafter held by and other Indebtedness or
property then or thereafter owing by such Lender or such Issuing Lender,
including, without limitation, any and all amounts in the Concentration Account
or the Disbursement Account. Each Lender or the Issuing Lender exercising such
rights
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shall notify the Administrative Agent thereof and any amount received as a
result of the exercise of such rights shall be reallocated among the Lenders and
the Issuing Lender as set forth in Section 2.10 hereof; PROVIDED, HOWEVER, that
failure of the Borrower to receive such notice shall not impair any Lender's or
the Issuing Lender's rights hereunder.
11.18 OTHER CREDIT DOCUMENTS. The Lenders hereby authorize the
Administrative Agent and the Collateral Agent to enter into the various Credit
Documents (or amendments thereto) attached as exhibits to this Credit Agreement
on their behalf.
11.19 CERTAIN PROVISIONS REGARDING PERFECTION OF SECURITY INTERESTS.
(a) Notwithstanding anything to the contrary contained in this Credit Agreement
or any of the other Credit Documents, the Lenders acknowledge and agree that,
except to the extent that further actions are required to be taken in accordance
with the terms of Section 7.13 of this Credit Agreement, (i) with respect to
Non-Certificated Units from time to time held by the Unit Subsidiary,
certificates of title have not been issued with respect thereto and,
accordingly, no notation of a security interest has been made under the titling
statutes of any State in connection therewith and (ii) with respect to Units
from time to time leased to customers, "fixture filings" will not be made under
the provisions of the Uniform Commercial Code as in effect in the relevant
State, both because of the administrative difficulty of ascertaining whether any
such Unit is or becomes a fixture and the inability of the Borrower and its
Subsidiaries to provide the relevant information which would be required to make
such filings. Notwithstanding the penultimate sentence of Section 7.13, if the
Borrower or any of its Subsidiaries becomes aware that a Certificate of Title is
required to be issued with respect to any Non-Certificated Unit under applicable
state law, the Borrower shall take all steps as may be necessary so that a
certificate of title is issued with respect thereto, on which the security
interest of the Collateral Agent is noted. Furthermore, in the event the
Administrative Agent or the Required Lenders reasonably believes that
Certificates of Title may be required to be issued in connection with
Non-Certificated Units located in any State, the Borrower shall promptly (and in
any event within 30 days after its receipt of the respective request) following
a request by the Administrative Agent or the Required Lenders, cause special
counsel or special counsels designated by it (who shall be reasonably acceptable
to the Administrative Agent or the Required Lenders) to issue, with respect to
the laws of a requested State or States, an opinion in form reasonably
satisfactory to the Administrative Agent and the Required Lenders as to whether
Certificates of Title are required to be issued with respect to any
Non-Certificated Units under the laws of such State or States and, whether based
thereon or upon the advice of their own counsel, if at any time the
Administrative Agent or the Required Lenders inform the Borrower that they in
good faith believe that Certificates of Title are required to be issued with
respect to any Non-Certificated Unit under applicable state law and further
request that the actions described in this sentence be taken, then the Borrower
shall take all steps as may be necessary so that, within 90 days from the date
of the respective request, a certificate of title is issued with respect
thereto, on which the security interest of the Collateral Agent is noted;
PROVIDED that unless an Event of Default has occurred and is continuing, the
Administrative Agent or the Required Lenders shall not, in any event, request an
opinion with respect to any one State more than once in a calendar year. So long
as Sections 7.18(a) and 8.12 of this Credit Agreement are complied with, the
provisions of this Credit Agreement and the other Credit Documents shall be
deemed modified to the extent necessary to permit the foregoing (and so that no
violation of this Credit Agreement or the other Credit Documents exists or shall
exist as a result of the actions permitted to be taken (or not
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taken) in accordance with the provisions of preceding clauses (i) and (ii) of
the first sentence of this Section 11.19 unless and until (and then to the
extent) required to be taken in accordance with the two preceding sentences)
(including, without limitation, all conditions precedent, representations,
warranties, covenants and other agreements herein and therein).
(b) AUTOMOBILES AND TRUCKS. The Borrower and its Subsidiaries were
not required to take steps necessary to perfect the security interests purported
to be created by the Security Agreements in automobiles and trucks. The
Collateral Agent or the Required Lenders at any time may, but shall not be
required to, request that the Borrower and/or of the Subsidiary Guarantors take
any and all actions with respect to such automobiles and/or trucks necessary to
create a first priority perfected lien of the Collateral Agent on any
automobiles or trucks pledged pursuant to the relevant Security Agreements.
(c) CERTAIN CERTIFICATED UNITS. With respect to Certificated Units
of the Borrower and its Subsidiaries evidenced by certificates of title issued
under the laws of the State of California ("California Certificated Units")
only, the Borrower and its Subsidiaries were not required to satisfy the
condition precedent set forth in Section 5.1(d)(C) on the Initial Borrowing
Date. With respect to all California Certificated Units acquired by the Borrower
and its Subsidiaries after the Initial Borrowing Date, the Borrower and its
Subsidiaries shall be required to comply with the provisions of Section 7.18
(with no relief therefrom). With respect to all California Certificated Units
owned by the Borrower and its Subsidiaries on the Initial Borrowing Date (the
"IBD CALIFORNIA CERTIFICATED UNITS"), the Borrower shall be required to satisfy
the condition precedent set forth in Section 5.1(d)(C) in full not later than
the 270th day after the Initial Borrowing Date, and shall further be required to
have satisfied such condition with respect to at least 50% of the Net Book Value
of all IBD California Certificated Units, on or prior to the 180th day after the
Initial Borrowing Date. By each date described in the preceding sentence (i.e.,
each of the 180th and 270th day after the Initial Borrowing Date), the Borrower
shall have provided evidence that, with respect the IBD California Certificated
Units owned by the Borrower and its Subsidiaries (or 50% thereof in the case of
such 180th day), a notation of the security interest of the Collateral Agent has
been made on the certificate of title with respect thereto (or that the Borrower
has deposited an application for such notation with the applicable Governmental
Authority, together with any necessary fee in connection therewith).
(d) COLLATERAL LOCATED IN ONTARIO; RECEIVABLES OF WSC. As a
consequence of a work stoppage of certain governmental employees of the relevant
filing offices for the filing of Financing Statements under the Personal
Property Security Act (Ontario), WSC was not required to have filed on or prior
to the Initial Borrowing Date Financing Statements necessary to perfect the
security interests purported to be created under the Canadian Security Agreement
in the assets of WSC located in the province of Ontario (such assets, the "WSC
ONTARIO ASSETS") or the Receivables (as defined in the Canadian Security
Agreement) of WSC (the "WSC RECEIVABLES"). Not later than the tenth day after
the cessation of such work stoppage, WSC shall:
(i) have filed or shall have caused to have been filed all such
Financing Statements necessary to perfect the security
interests purported to be created under the Canadian Security
Agreement in all of the WSC Ontario Assets and all of the WSC
Receivables pursuant to a financing statement in form and
substance satisfactory to the Collateral Agent;
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(ii) caused to be delivered to the Collateral Agent the results of
then recent searches conducted in the Province of Ontario
against WSC and all former names of WSC and its predecessor
companies;
(iii) have delivered or caused to be delivered to the Collateral
Agent any and all such consents, acknowledgements, discharges
and subordinations necessary, or as the Collateral Agent may
reasonably require, in order to ensure that the security
interest created by the Canadian Security Agreement
constitutes a valid, enforceable and perfected security
interest superior to and prior to the rights of all third
Persons and subject to no other Liens, other than Permitted
Liens; and
(iv) caused to be delivered to the Collateral Agent an opinion of
▇▇▇▇▇▇ ▇▇▇▇ Philips & Vineberg LLP addressed to each Agent and
each of the Lenders as to the results of the searches
described in preceding clause (iii) and as to the matters set
forth above in the sentence all in form and substance
satisfactory to the Collateral Agent.
Consistent with the provisions of the definition of Eligible Rental Equipment
and Eligible Accounts Receivable, until such time as when (i) the WSC Ontario
Assets are perfected as contemplated in the preceding sentence and the Canadian
Security Agreement, no WSC Ontario Assets shall be included as, or deemed to be,
Eligible Rental Equipment and (ii) the WSC Receivables are perfected as
contemplated in the preceding sentence and the Canadian Security Agreement, no
WSC Receivables shall be included as, or deemed to be, Eligible Accounts
Receivable.
(e) The Borrower was not required to deliver, or cause to be
delivered, on the Initial Borrowing Date certain opinions pursuant to Section
5.1(c)(d) from local counsel in the jurisdictions of Florida, California, Texas,
Georgia, New Jersey, Ohio, Washington, New Hampshire, Pennsylvania and North
Carolina. Not later than fifteen (in the case of Washington, 30) days following
the Initial Borrowing Date, the Borrower shall have delivered, or caused to have
been delivered, each such local counsel opinion and each such local counsel
opinion shall be in form and substance reasonably satisfactory to the
Administrative Agent.
(f) WSC was not required to deliver on the Initial Borrowing Date
any executed Canadian Bank Control Agreements. Not later than 45 days following
the Initial Borrowing Date, WSC shall have executed and delivered to the
Collateral Agent a Canadian Bank Control Agreement for all deposit and bank
accounts maintained by WSC.
(g) All provisions of this Credit Agreement and the other Credit
Documents (including, without limitation, all conditions precedent,
representations, warranties, covenants and other agreements herein and therein)
shall be deemed modified to the extent necessary to effect the provisions set
forth in preceding clauses (b), (c), (d) (subject to the last sentence thereof),
(e) and (f) (and to permit the taking of the actions to the extent required
pursuant to such clauses rather than as otherwise provided in the Credit
Documents); PROVIDED, that (x) to the extent any representation and warranty
would not be true because such actions were not taken on the Effective Date, the
respective representation and warranty shall be required to be true and
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correct in all material respects at the time the respective action is taken (or
was required to be taken) in accordance with clauses (b) through (f), inclusive,
of this Section 11.19 and (y) all representation and warranties relating to the
Collateral Documents shall be required to be true immediately after the actions
required to be taken by clauses (b) through (f), inclusive, of this Section
11.19 have been taken (or were required to be taken).
11.20 CONVERSION OF UNIT SUBSIDIARY TO DELAWARE BUSINESS TRUST. The
Borrower has informed the parties hereto that it, and the Unit Subsidiary, may
wish to convert the Unit Subsidiary from a Delaware limited liability company to
a Delaware business trust. The parties hereto agree that such a conversion may
be effected, but only with the prior written consent of the Administrative Agent
(which may be granted or withheld by the Administrative Agent in its sole
discretion), if the following conditions are satisfied:
(i) the Borrower shall have given the Lenders and the
Administrative Agent at least 30 days prior written notice of its desire to
effect the conversion, stating the business reasons therefor in reasonable
detail;
(ii) neither the occurrence of the conversion described above, nor
the execution, delivery and performance by any Credit Party of any of the Credit
Documents to be executed, delivered or modified in connection therewith, (i)
will contravene any applicable provision of any law, statute, rule, regulation,
order, writ, injunction or decree of any court or governmental instrumentality,
(ii) will conflict or be inconsistent with or violate or result in any breach of
any of the terms, covenants, conditions or provisions of, or constitute a
default under, or (other than pursuant to the Collateral Documents) result in a
creation or imposition of (or the obligation to create or impose) any Lien upon
any of the property or assets of any Credit Party or any of its Subsidiaries
pursuant to the terms of any indenture (including without limitation the Senior
Unsecured Notes Indenture), mortgage, deed or trust, agreement or other
instrument to which any Credit Party or any of its Subsidiaries is a party or by
which it or any of its property or assets are bound or to which it may be
subject or (iii) will violate any provisions of any Governing Document of
Holdings, the Borrower or any of the respective Subsidiaries;
(iii) the Borrower shall have certified, and the Administrative
Agent shall have concluded, that the conversion shall not be adverse to the
Lenders (or their rights or remedies under the various Collateral Documents) in
any material respect;
(iv) after giving effect to the conversion, the converted entity
(as same may be required to be renamed to comply with the applicable Delaware
law governing business trusts) shall constitute the "Subordinated Guarantor" as
defined in, and for all purposes of, the Senior Unsecured Notes Indenture, and
all Obligations (as defined in the Senior Unsecured Notes Indenture) of the
business trust referred to above, as Subordinated Guarantor pursuant to the
Senior Unsecured Notes Indenture, shall continue to be subordinated, as provided
in Article Eleven of the Senior Unsecured Notes Indenture, to all obligations on
the Subordinated Guarantor Senior Indebtedness (as defined in the Senior
Unsecured Notes Indenture), which term shall in any event continue to include
all obligations of the Unit Subsidiary (following its conversion to a Delaware
business trust) pursuant to the Subsidiaries Guaranty;
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(v) the parties to the Senior Unsecured Notes Indenture shall have
executed (and delivered a copy to the Administrative Agent) a supplemental
indenture thereto, which acknowledges and agrees to the items described in
preceding clause (iv), and specifies that the "Subordinated Guarantor" as
defined in the Senior Unsecured Notes Indenture shall thereafter constitute the
Delaware business trust resulting from the conversion of the Unit Subsidiary as
described above;
(vi) the Administrative Agent shall be satisfied that, following
the conversion, the Unit Subsidiary may (in accordance with its Governing
Documents and relevant provisions of Delaware law) continue to be a party to the
various Credit Documents to which the Unit Subsidiary (prior to such conversion)
was a party, and that the grants of security interests pursuant to the various
Collateral Documents by the Unit Subsidiary shall continue in full force and
effect, with the same priorities as theretofore applied; (vii) after giving
effect to the conversion, all equity interests in the Unit Subsidiary (as
converted to a Delaware business trust) and all special units of beneficial
interest ("SUBI'S"), if any, and all undivided trust interests ("UTI'S"), if
any, therein shall be pledged to the Collateral Agent for the benefit of the
Secured Creditor (and the Administrative Agent may require appropriate
modifications to the U.S. Pledge Agreement in connection therewith);
(viii) the Unit Subsidiary (as converted to a Delaware business
trust) and any other Credit Parties as requested by the Administrative Agent
shall enter into any modifications to the Credit Documents as may be requested
by the Administrative Agent or Collateral Agent to further the intent of this
Section 11.20 and to provide for, or protect, the guarantees and security
interests required to be granted as described herein;
(ix) the Administrative Agent and the Lenders shall have received
such legal opinions (including, without limitation, opinions from (x) New York
counsel (who shall be satisfactory to the Administrative Agent) to the Borrower
(including, without limitation, as the matters described in clauses (ii) and
(iv) above, with respect to the Senior Unsecured Notes Indenture) and (y)
special Delaware counsel to the Borrower, including, without limitation as to
the matters described in clauses (ii) (with respect to the Governing Documents
of the Unit Subsidiary and matters of Delaware law) and (iii) above, each of
which opinions shall be rendered by counsel, and in form and substance,
satisfactory to the Administrative Agent; and
(x) at the time of any conversion pursuant to this Section 11.20
(and immediately after giving effect thereto), (x) all representations and
warranties contained herein and in the other Credit Documents shall be true and
correct in all material respects and (y) no Default or Event of Default shall be
in existence.
In connection with the matters described above, the Administrative
Agent and Collateral Agent shall be entitled to retain (at the expense of the
Borrower) special Delaware counsel to advise them in connection with the matters
described above and, in connection therewith, may conclusively rely on the
advice of such counsel. All items described above shall be required to be taken
to the satisfaction of the Administrative Agent and, as appropriate, the
Collateral Agent. The Administrative Agent may, as contemplated above, (but
shall not be required to) approve the conversion of the Unit Subsidiary to a
Delaware business trust in
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accordance with the preceding provisions. In such event, the Administrative
Agent and Collateral Agent are authorized to enter into such modifications to
the Credit Documents (other than this Credit Agreement) as are deemed necessary
or desirable in connection therewith (with the intent being to further the
purposes of this Section 11.20). The Administrative Agent shall be entitled (but
shall not be required) to withhold its consent to any such conversion in its
sole discretion or may (but shall not be required to) require that either (x)
the consent of the Required Lenders be obtained or (y) that all or any portion
of the items required to be delivered as set forth above be distributed to the
Lenders in advance of the conversion, with the condition to the conversion being
that the Required Lenders shall not have objected in writing to the
Administrative Agent thereto prior to the date of the conversion. Neither the
Administrative Agent nor the Collateral Agent shall have any liability to any
Lender or other Secured Creditor (or any other Person) for any actions taken by
it (or which it believes are taken by it) in accordance with the provisions of
this Section 11.20. The Borrower hereby covenants and agrees that it shall not
effect any conversion of the Unit Subsidiary from a Delaware limited liability
company to any other form of entity, except for any conversion to a Delaware
business trust if, and to the extent, expressly permitted pursuant to the
provisions of this Section 11.20. If any conversion of the Unit Subsidiary to a
Delaware business trust is made, and at the time of the making thereof the
Borrower shall be deemed to have represented and warranted to the Lenders that
all applicable conditions set forth in this Section 11. 20 are satisfied at the
time thereof.
11.21 ACKNOWLEDGEMENTS REGARDING SECURITY BOND OBLIGATIONS. For
greater certainty, and without limiting the powers of the Collateral Agent
hereunder or under any of the other Credit Documents, the Borrower hereby
acknowledges that the Collateral Agent shall, for purposes of holding any
security interest granted by any Credit Party in any of its property or assets
pursuant to the laws of the Province of Quebec to secure obligations of such
Credit Party under any debenture or bond (any such obligations, "SECURITY BOND
OBLIGATIONS"), be the holder of an irrevocable power of attorney (FONDE DE
POUVOIR) (within the meaning of the CIVIL CODE OF QUEBEC, as amended) for each
Secured Creditor and in particular for all present and future holders of any
debenture or bond (the Secured Creditors and any such holders, collectively, the
"SECURED CREDITOR GRANTORS"). Each Security Creditor Grantor hereby constitutes,
to the extent necessary, the Collateral Agent as the holder of an irrevocable
power of attorney (FONDE DE POUVOIR) (within the meaning of Article 2692 of the
CIVIL CODE OF QUEBEC, as amended) in order to hold security granted by any
Credit Party in the Province of Quebec to secure Security Bond Obligations. Each
assignee of any Secured Creditor Grantor shall be deemed to have confirmed and
ratified the constitution of the Collateral Agent as the holder of such
irrevocable power of attorney (FONDE DE pouvoir) upon becoming a Lender under
this Credit Agreement as contemplated in Section 11.6(b)(A) and/or by receiving
the benefits of the Collateral Documents. Notwithstanding the provisions of
Section 32 of AN ACT RESPECTING THE SPECIAL POWERS OF LEGAL PERSONS (Quebec),
the Collateral Agent may acquire and be the holder of any debenture or bond. The
Borrower hereby acknowledges that such debenture or bond constitutes a title of
indebtedness, as such term is used in Article 2692 of the CIVIL CODE OF QUEBEC,
as amended.
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ARTICLE 12
HOLDINGS SECURED GUARANTY
-------------------------
12.1 THE HOLDINGS SECURED GUARANTY. In order to induce the Agents,
each Issuing Lender and the Lenders to enter into this Credit Agreement and to
extend credit hereunder, and to induce the other Guaranteed Creditors to enter
into Interest Rate Agreements, and in recognition of the direct benefits to be
received by Holdings from the proceeds of the Loans, the issuance of the Letters
of Credit and the entering into of such Interest Rate Agreements, Holdings
hereby agrees with the Guaranteed Creditors as follows: Holdings hereby
unconditionally and irrevocably guarantees the full and prompt payment when due,
whether upon maturity, by acceleration or otherwise, of any and all Obligations
of the Borrower to the Guaranteed Creditors. If any or all of the Obligations of
the Borrower to the Guaranteed Creditors becomes due and payable hereunder,
Holdings unconditionally promises to pay such Guaranteed Obligations to the
Guaranteed Creditors, or order, on demand, together with any and all reasonable
expenses which may be incurred by the Agents and the other Guaranteed Creditors
in collecting any of the Obligations. This guaranty constitutes a guaranty of
payment and not of collection, and applies to all Obligations of the Borrower
arising in connection with this Credit Agreement and the other Credit Documents,
in each case, heretofore, now, or hereafter made, incurred or created, whether
voluntarily or involuntarily, absolute or contingent, liquidated or
unliquidated, determined or undetermined, whether or not such Guaranteed
Obligations are from time to time reduced, or extinguished and thereafter
increased or incurred, whether the Borrower may be liable individually or
jointly with others, whether or not recovery upon such Guaranteed Obligations
may be or hereafter become barred by any statute of limitations, and whether or
not such Guaranteed Obligations may be or hereafter become otherwise
unenforceable.
12.2 BANKRUPTCY. Additionally, Holdings unconditionally and
irrevocably guarantees the payment of any and all Guaranteed Obligations of the
Borrower to the Guaranteed Creditors whether or not due or payable by the
Borrower upon the occurrence in respect of the Borrower of any of the events
specified in Section 9.1(e), and unconditionally and irrevocably promises to pay
all such Guaranteed Obligations to the Guaranteed Creditors, or order, on
demand, in lawful money of the United States.
12.3 NATURE OF LIABILITY. The liability of Holdings hereunder is
exclusive and independent of any security for or other guaranty of the
Guaranteed Obligations of the Borrower whether executed by Holdings, any other
guarantor or by any other party, and the liability of Holdings hereunder shall
not be affected or impaired by (a) any direction as to application of payment by
the Borrower or by any other party, or (b) any other continuing or other
guaranty, undertaking or maximum liability of a guarantor or of any other party
as to the Guaranteed Obligations of the Borrower, or (c) any payment on or in
reduction of any such other guaranty or undertaking, or (d) any dissolution,
termination or increase, decrease or change in personnel by the Borrower, or (e)
any payment made to any Guaranteed Creditor on the Guaranteed Obligations which
such Guaranteed Creditors repay to the Borrower pursuant to court order in any
bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceeding, and Holdings waives any right to the deferral or modification of its
obligations hereunder by reason of any such proceeding.
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12.4 INDEPENDENT OBLIGATION. The obligations of Holdings hereunder
are independent of the obligations of any other guarantor or the Borrower, and a
separate action or actions may be brought and prosecuted against Holdings
whether or not action is brought against any other guarantor or the Borrower and
whether or not any other guarantor or the Borrower be joined in any such action
or actions. Holdings waives, to the fullest extent permitted by law, the benefit
of any statute of limitations affecting its liability hereunder or the
enforcement thereof. Any payment by the Borrower or other circumstance which
operates to toll any statute of limitations as to the Borrower shall, to the
fullest extent permitted by law, operate to toll the statute of limitations as
to Holdings.
12.5 AUTHORIZATION. Holdings authorizes each Guaranteed Creditor
without notice or demand (except as shall be required by applicable statute and
cannot be waived), and without affecting or impairing its liability hereunder,
from time to time to:
(a) subject to the prior agreement of the Borrower (to the extent
required by the Credit Agreement), change the manner, place or terms of payment
of, and/or change or extend the time of payment of, renew, increase, accelerate
or alter, any of the Guaranteed Obligations (including any increase or decrease
in the rate of interest thereon), any security therefor, or any liability
incurred directly or indirectly in respect thereof, and the Holdings Secured
Guaranty herein made shall apply to the Guaranteed Obligations as so changed,
extended, renewed or altered;
(b) take and hold security for the payment of the Guaranteed
Obligations and sell, exchange, release, surrender, realize upon or otherwise
deal with in any manner and in any order any property by whomsoever at any time
pledged or mortgaged to secure, or howsoever securing, the Guaranteed
Obligations or any liabilities (including any of those hereunder) incurred
directly or indirectly in respect thereof or hereof, and/or any offset
thereagainst;
(c) exercise or refrain from exercising any rights against the
Borrower or others or otherwise act or refrain from acting;
(d) release or substitute any one or more endorsers, guarantors,
the Borrower or other obligors;
(e) settle or compromise any of the Guaranteed Obligations, any
security therefor or any liability (including any of those hereunder) incurred
directly or indirectly in respect thereof or hereof, and may subordinate the
payment of all or any part thereof to the payment of any liability (whether due
or not) of the Borrower to its creditors other than the Guaranteed Creditors;
(f) apply any sums by whomsoever paid or howsoever realized to any
liability or liabilities of the Borrower to the Guaranteed Creditors regardless
of what liability or liabilities of Holdings or the Borrower remain unpaid;
and/or
(g) consent to or waive any breach of, or any act, omission or
default under, this Credit Agreement or any of the instruments or agreements
referred to herein, or, with the agreement of the Borrower, amend, modify or
supplement this Credit Agreement or any of such other instruments or agreements.
-150-
12.6 RELIANCE. It is not necessary for the any Guaranteed Creditor
to inquire into the capacity or powers of the Borrower or its Subsidiaries or
the officers, directors, partners or agent acting or purporting to act on its
behalf, and any Guaranteed Obligations made or created in reliance upon the
professed exercise of such powers shall be guaranteed hereunder.
12.7 SUBORDINATION. Any obligations of the Borrower now or
hereafter owing to Holdings are hereby subordinated in right of payment to the
Guaranteed Obligations of the Borrower owing to the Guaranteed Creditors;
PROVIDED that payment may be made by the Borrower on any such obligations owing
to Holdings so long as the same is not prohibited by this Credit Agreement; and
PROVIDED FURTHER, that if the Administrative Agent so requests at a time when an
Event of Default exists, all such obligations of the Borrower to Holdings shall
be collected, enforced and received by Holdings as trustee for the Guaranteed
Creditors and be paid over to the Guaranteed Creditors on account of the
Guaranteed Obligations of the Borrower to the Guaranteed Creditors, but without
affecting or impairing in any manner the liability of Holdings under the other
provisions of this Holdings Secured Guaranty. Prior to the transfer by Holdings
of any note or negotiable instrument evidencing any obligations of the Borrower
to Holdings, Holdings shall ▇▇▇▇ such note or negotiable instrument with a
legend that the same is subject to this subordination.
12.8 WAIVER. (a) Holdings waives any right (except as shall be
required by applicable statute and cannot be waived) to require any Guaranteed
Creditor to (i) proceed against the Borrower, any other guarantor or any other
party, (ii) proceed against or exhaust any security held from the Borrower, any
other guarantor or any other party or (iii) pursue any other remedy in any such
Guaranteed Creditor's power whatsoever. Holdings waives any defense based on or
arising out of any defense of the Borrower, any other guarantor or any other
party other than payment in full of the Guaranteed Obligations, including,
without limitation, any defense based on or arising out of the disability of the
Borrower, any other guarantor or any other party, or the unenforceability of the
Guaranteed Obligations or any part thereof from any cause, or the cessation from
any cause of the liability of the Borrower other than payment in full of the
Guaranteed Obligations. The Guaranteed Creditors may, at their election,
foreclose on any security held by any Agent, any Issuing Lender, the Collateral
Agent or any other Guaranteed Creditor by one or more judicial or nonjudicial
sales, whether or not every aspect of any such sale is commercially reasonable
(to the extent such sale is permitted by applicable law), or exercise any other
right or remedy the Guaranteed Creditors may have against the Borrower or any
other party, or any security, without affecting or impairing in any way the
liability of Holdings hereunder except to the extent the Guaranteed Obligations
have been paid. Holdings waives, to the fullest extent permitted by law, any
defense arising out of any such election by the Guaranteed Creditors, even
though such election operates to impair or extinguish any right of reimbursement
or subrogation or other right or remedy of Holdings against the Borrower or any
other party or any security.
(b) Holdings waives all presentments, demands for performance,
protests and notices, including without limitation notices of nonperformance,
notices of protest, notices of dishonor, notices of acceptance of this Holdings
Secured Guaranty, and notices of the existence, creation or incurring of new or
additional Guaranteed Obligations. Holdings assumes all responsibility for being
and keeping itself informed of the Borrower's financial condition and assets,
and of all other circumstances bearing upon the risk of nonpayment of the
Guaranteed
-151-
Obligations and the nature, scope and extent of the risks which Holdings assumes
and incurs hereunder, and agrees that no Guaranteed Creditor shall have any duty
to advise Holdings of information known to them regarding such circumstances or
risks.
12.9 LIMITATION ON ENFORCEMENT. The Guaranteed Creditors agree that
this Holdings Secured Guaranty may be enforced only by the action of the
Administrative Agent, in each case acting upon the instructions of the Required
Lenders, and that no other Guaranteed Creditor shall have any right individually
to seek to enforce or to enforce this Holdings Secured Guaranty, it being
understood and agreed that such rights and remedies may be exercised by the
Administrative Agent for the benefit of the Guaranteed Creditors upon the terms
of this Credit Agreement. The Guaranteed Creditors further agree that this
Holdings Secured Guaranty may not be enforced against any Affiliate, director,
officer, employee or stockholder of Holdings.
* * *
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IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Credit Agreement as of the date
first above written.
ADDRESS:
-------
8211 Town Center Drive SCOTSMAN HOLDINGS, INC.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ ---------------------------------------
Title: Senior Vice President/Chief
Financial Officer
▇▇▇▇▇▇▇▇ SCOTSMAN, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------
Title: Senior Vice President/Chief
Financial Officer
BANKERS TRUST COMPANY, Individually
and as Administrative Agent
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
---------------------------------------
Title: Director
FLEET CAPITAL CORPORATION, Individually
and as a Co-Syndication Agent
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------
Title: Senior Vice President
CONGRESS FINANCIAL CORPORATION,
Individually and as a Co-Syndication Agent
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Title: Vice President
BANK OF AMERICA, N.A., Individually and as
a Co-Documentation Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------------
Title: Vice President
GMAC BUSINESS CREDIT, LLC, Individually
and as a Co-Documentation Agent
By: /s/ ▇▇▇▇ ▇▇▇▇
---------------------------------------
Title: Managing Director
THE CIT GROUP/BUSINESS CREDIT, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------------
Title: Vice President/Team Leader
LASALLE BANK NATIONAL ASSOCIATION
formerly known as LaSalle National Bank
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------
Title: Senior Vice President
NATIONAL CITY COMMERICAL FINANCE, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------
Title: Senior Vice President
PNC BANK, NATIONAL ASSOCIATION
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇
---------------------------------------
Title: Assistant Vice President
TRANSAMERICA BUSINESS CAPITAL CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------
Title: Senior Vice President
CIBC INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------------
Title: Executive Director
CIBC World Markets Corp. as Agent
ALLFIRST BANK
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------
Title: Vice President
ORIX FINANCIAL SERVICES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇
---------------------------------------
Title: Senior Vice President
IBJ WHITEHALL BUSINESS CREDIT CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Title: Vice President
COMERICA BANK
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------------
Title: First Vice President
THE PROVIDENT BANK
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇▇
---------------------------------------
Title: Vice President
PEOPLE'S BANK
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------------
Title: Vice President
SIEMENS FINANCIAL SERVICES, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------------
Title: Vice President- Credit
TABLE OF CONTENTS
-----------------
PAGE
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ARTICLE 1 Definitions..................................................1
1.1 General Definitions..........................................1
1.2 Accounting Terms and Determinations.........................39
1.3 Other Defined Terms.........................................39
ARTICLE 2 Amount and Terms of Credit..................................40
2.1 The Commitments.............................................40
2.2 Determination of Borrowing Base for Revolving Loans; etc....44
2.3 Borrowing Mechanics.........................................45
2.4 Settlements Among the Payments Administrator and
the Lenders.................................................47
2.5 Mandatory and Voluntary Payments: Mandatory and
Voluntary Reduction of Commitments..........................50
2.6 Payments and Computations...................................57
2.7 Maintenance of Account......................................58
2.8 Statement of Account........................................59
2.9 Taxes.......................................................59
2.10 Sharing of Payments.........................................61
ARTICLE 3 Letters of Credit...........................................62
3.1 Issuance of Letters of Credit...............................62
3.2 Terms of Letters of Credit..................................63
3.3 Revolving Credit Lenders' Participation.....................63
3.4 Notice of Issuance..........................................63
3.5 Payment of Amounts Drawn Under Letters of Credit............64
3.6 Payment by Revolving Credit Lenders.........................64
3.7 Nature of Issuing Lender's Duties...........................65
3.8 Obligations Absolute........................................65
ARTICLE 4 Interest, Fees and Expenses.................................66
4.1 Interest on Eurodollar Rate Loans...........................66
4.2 Interest on Base Rate Loans.................................67
4.3 Notice of Continuation and Notice of Conversion.............67
4.4 Interest After Default......................................68
4.5 Reimbursement of Expenses...................................69
4.6 Unused Line Fee.............................................69
4.7 Letter of Credit Fees.......................................69
4.8 Incremental Commitments.....................................70
4.9 Other Fees and Expenses.....................................70
4.10 Authorization to Charge Account.............................70
4.11 Indemnification in Certain Events...........................71
4.12 Calculations................................................72
4.13 Change of Applicable Lending Office.........................72
(i)
PAGE
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ARTICLE 5 Conditions Precedent........................................72
5.1 Conditions to Initial Loans and Letters of Credit...........72
5.2 Conditions to all Credit Events.............................80
ARTICLE 6 Representations and Warranties..............................80
6.1 Corporate Status............................................81
6.2 Corporate Power and Authority...............................81
6.3 No Violation................................................81
6.4 Litigation..................................................81
6.5 Use of Proceeds.............................................82
6.6 Governmental Approvals......................................82
6.7 Investment Company Act......................................82
6.8 Public Utility Holding Company Act..........................82
6.9 True and Complete Disclosure................................82
6.10 Financial Condition; Financial Statements...................83
6.11 Locations of Offices, Records, Inventory and
Rental Equipment............................................83
6.12 Security Interests..........................................84
6.13 Tax Returns and Payments....................................84
6.14 Compliance with ERISA.......................................84
6.15 Subsidiaries................................................85
6.16 Intellectual Property; etc..................................86
6.17 Compliance with Statutes, etc...............................86
6.18 Properties..................................................87
6.19 Labor Relations; Collective Bargaining Agreements...........87
6.20 Restrictions on Subsidiaries................................87
6.21 Status of Accounts..........................................88
6.22 Material Contracts..........................................88
6.23 Existing Indebtedness and Operating Leases..................88
6.24 Guarantee of Certain Notes; Subordinated Guarantor
Senior Indebtedness; Credit Agreement; etc..................88
6.25 Unit Subsidiary.............................................88
6.26 Rental Equipment; Business of the Credit Parties............89
6.27 Legal Names; Type of Organization (and Whether a
Registered Organization); Jurisdiction of
Organization; etc...........................................89
6.28 Insurance...................................................89
6.29 Ownership of Rental Equipment...............................89
6.30 No Permitted Units Financing or Attributable Debt...........89
ARTICLE 7 Affirmative Covenants.......................................90
7.1 Financial Information.......................................90
7.2 Real Estate Appraisals......................................95
7.3 Corporate Franchises........................................95
7.4 Compliance with Statutes, etc...............................95
7.5 ERISA.......................................................96
7.6 Good Repair.................................................97
7.7 Books and Records...........................................98
7.8 Collateral Records..........................................98
(ii)
PAGE
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7.9 Security Interests..........................................98
7.10 Insurance; Casualty Loss....................................99
7.11 Taxes......................................................100
7.12 End of Fiscal Years; Fiscal Quarters.......................100
7.13 Further Assurances.........................................100
7.14 Maintenance of Separateness................................101
7.15 Collateral Access Agreements...............................102
7.16 New Subsidiaries...........................................102
7.17 Permitted Acquisitions.....................................102
7.18 Unit Subsidiary; Provisions Relating to Units; etc.........104
7.19 Use of Proceeds............................................104
7.20 Rental Equipment; Business of the Credit Parties...........104
7.21 Ownership of Rental Equipment..............................104
7.22 No Permitted Units Financing or Attributable Debt..........105
ARTICLE 8 Negative Covenants.........................................105
8.1 Consolidation, Merger, Sale or Purchase of Assets, etc.....105
8.2 Liens......................................................108
8.3 Indebtedness...............................................110
8.4 Capital Expenditures.......................................111
8.5 Investments................................................112
8.6 Dividends, etc.............................................114
8.7 Transactions with Affiliates...............................115
8.8 Changes in Business........................................117
8.9 Consolidated Leverage Ratio................................117
8.10 Consolidated Interest Coverage Ratio.......................118
8.11 Utilization................................................118
8.12 Creation of Subsidiaries...................................118
8.13 Limitation on Voluntary Payments and Modifications
of Indebtedness; Modifications of Governing Documents,
Preferred Stock and Certain Other Agreements; etc..........119
8.14 Issuance of Stock..........................................119
8.15 Limitation on Restrictions Affecting Subsidiaries..........120
8.16 No Additional Bank Accounts................................120
8.17 No Excess Cash.............................................121
8.18 Account Terms..............................................121
8.19 Permitted Preferred Stock..................................121
8.20 Unit Subsidiary............................................121
8.21 Change of Legal Names; Type of Organization (and
Whether a Registered Organization); Jurisdiction of
Organization etc...........................................121
ARTICLE 9 Events of Default and Remedies.............................122
9.1 Events of Default..........................................122
ARTICLE 10 The Agents.................................................125
10.1 Appointment................................................125
10.2 Nature of Duties...........................................126
(iii)
PAGE
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10.3 Lack of Reliance on the Agents.............................126
10.4 Certain Rights of the Agents...............................126
10.5 Reliance by the Agents.....................................126
10.6 Indemnification............................................127
10.7 Each Agent in its Individual Capacity......................127
10.8 Holders of Notes...........................................127
10.9 Resignation by the Agents; Successor Agents; etc...........128
10.10 Collateral Matters.........................................128
10.11 Co-Collateral Agents; Separate Collateral Agents...........129
10.12 Actions with Respect to Defaults...........................131
10.13 Delivery of Information....................................131
10.14 The Co-Syndication Agents and the Co-Documentation Agents..132
ARTICLE 11 Miscellaneous..............................................132
11.1 Submission to Jurisdiction; Waivers........................132
11.2 Waiver of Jury Trial.......................................133
11.3 Governing Law..............................................133
11.4 Delays: Partial Exercise of Remedies.......................133
11.5 Notices....................................................133
11.6 Benefit of Agreement.......................................133
11.7 Confidentiality............................................137
11.8 Indemnification............................................138
11.9 Entire Agreement; Successors and Assigns...................139
11.10 Amendment or Waiver........................................139
11.11 Nonliability of Administrative Agent and Lenders...........141
11.12 Independent Nature of Lenders' Rights......................141
11.13 Counterparts...............................................141
11.14 Effectiveness..............................................141
11.15 Headings Descriptive.......................................142
11.16 Maximum Rate...............................................142
11.17 Right of Setoff............................................142
11.18 Other Credit Documents.....................................143
11.19 Certain Provisions Regarding Perfection of
Security Interests.........................................143
11.20 Conversion of Unit Subsidiary to Delaware Business Trust...146
11.21 Acknowledgements Regarding Security Bond Obligations.......148
ARTICLE 12 Holdings Secured Guaranty..................................149
12.1 The Holdings Secured Guaranty..............................149
12.2 Bankruptcy.................................................149
12.3 Nature of Liability........................................149
12.4 Independent Obligation.....................................150
12.5 Authorization..............................................150
12.6 Reliance...................................................151
12.7 Subordination..............................................151
12.8 Waiver.....................................................151
12.9 Limitation on Enforcement..................................152
(iv)
SCHEDULE I Lender Commitments
SCHEDULE II Lenders Addresses
SCHEDULE III Existing Indebtedness and Operating Leases
SCHEDULE IV Real Properties
SCHEDULE V Existing Letters of Credit
SCHEDULE VI Location of Offices, Records, Inventory and Rental Equipment
SCHEDULE VII Tax Matters
SCHEDULE VIII ERISA Matters
SCHEDULE IX Subsidiaries
SCHEDULE X Collective Bargaining Agreements
SCHEDULE XI Legal Names; Type of Organization; Jurisdiction of
Organization
SCHEDULE XII Insurance
SCHEDULE XIII 8.1(o) Conditions
SCHEDULE XIV Existing Liens
SCHEDULE XV Surety Liens
SCHEDULE XVI Existing Investments
SCHEDULE XVII Bank Accounts
EXHIBIT A-1 Form of Term Note
EXHIBIT A-2 Form of Revolving Note
EXHIBIT B-1 Form of Notice of Borrowing
EXHIBIT B-2 Form of Letter of Credit Request
EXHIBIT B-3 Form of Notice of Continuation
EXHIBIT B-4 Form of Notice of Conversion
EXHIBIT C-1 Form of Collection Bank Agreement
EXHIBIT C-2 Form of Concentration Account Agreement
EXHIBIT C-3 Form of Canadian Bank Control Agreement
EXHIBIT D Form of Section 2.9(b)(ii) Certificate
EXHIBIT E-1 Form of Opinion of ▇▇▇▇, Weiss, Rifkind, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇,
special counsel to Holdings and the Borrower
EXHIBIT E-2 Form of Opinion of Davies ▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
EXHIBIT E-3 Form of Opinion of White & Case LLP
EXHIBIT F-1 Form of U.S. Security Agreement
EXHIBIT F-2 Form of Canadian Security Agreement
EXHIBIT G Form of Collateral Access Agreement
EXHIBIT H Form of Officer's Certificate
EXHIBIT I Form of Solvency Certificate
EXHIBIT J-1 Form of U.S. Subsidiaries Guaranty
EXHIBIT J-2 Form of Canadian Subsidiaries Guaranty
EXHIBIT K Form of U.S. Pledge Agreement
EXHIBIT L Form of Mortgage
EXHIBIT M Form of Custodian Agreement
EXHIBIT N Form of U.S. Subsidiary Joinder Agreement
EXHIBIT O Form of Compliance Certificate
EXHIBIT P Form of Borrowing Base Certificate
(v)
EXHIBIT Q-1 Form of Assignment and Assumption Agreement
EXHIBIT Q-2 Form of Notice of Assignment
EXHBIT R Form of Incremental Commitment Agreement
(vi)