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EXHIBIT 10.5
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CREDIT AGREEMENT
DATED AS OF JUNE 5, 1996
AMONG
APAC TELESERVICES, INC.,
THE LENDERS
PARTY HERETO,
AND
▇▇▇▇▇▇ TRUST AND SAVINGS BANK,
INDIVIDUALLY AND AS AGENT
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TABLE OF CONTENTS
SECTION DESCRIPTION PAGE
SECTION 1. THE CREDITS . .............................................................................. 1
Section 1.1. Facility A Credit ........................................................................ 1
Section 1.2. Facility B Credit ........................................................................ 2
Section 1.3. Manner and Disbursement of Loans ......................................................... 4
SECTION 2. INTEREST AND CHANGE IN CIRCUMSTANCES ....................................................... 5
Section 2.1. Interest Rate Options .................................................................... 5
Section 2.2. Minimum LIBOR Portion Amounts ........................................................... 6
Section 2.3. Computation of Interest .................................................................. 6
Section 2.4. Manner of Rate Selection ................................................................. 7
Section 2.5. Change of Law ............................................................................ 7
Section 2.6. Unavailability of Deposits or Inability to Ascertain Adjusted LIBOR ...................... 7
Section 2.7. Taxes and Increased Costs ................................................................ 8
Section 2.8. Change in Capital Adequacy Requirements .................................................. 9
Section 2.9. Funding Indemnity ........................................................................ 9
Section 2.10. Lending Branch ...........................................................................10
Section 2.11. Discretion of Lenders as to Manner of Funding ............................................10
Section 2.12. Lender's Duty to Mitigate ................................................................10
SECTION 3. FEES, PREPAYMENTS AND TERMINATIONS .........................................................11
Section 3.1. Facility A Commitment Fee ................................................................11
Section 3.2. Facility B Commitments ...................................................................11
Section 3.3. Agent's Fee ..............................................................................12
Section 3.4. Defaulting Lender ........................................................................12
Section 3.5. Voluntary Prepayments.....................................................................12
Section 3.6. Terminations .............................................................................12
SECTION 4. PAYMENTS, NOTATIONS AND REPLACEMENTS OF LENDERS ............................................13
Section 4.1. Place and Application of Payments ........................................................13
Section 4.2. Notations ................................................................................14
Section 4.3. Replacement of Lender ....................................................................14
SECTION 5. DEFINITIONS; INTERPRETATION ................................................................15
Section 5.1. Definitions ..............................................................................15
Section 5.2. Interpretation ...........................................................................25
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SECTION 6. REPRESENTATIONS AND WARRANTIES ..............................................................25
Section 6.1. Organization and Qualification ...........................................................25
Section 6.2. Subsidiaries .............................................................................25
Section 6.3. Corporate Authority and Validity of Obligations ..........................................26
Section 6.4. Use of Proceeds; Margin Stock ............................................................26
Section 6.5. Financial Reports ........................................................................26
Section 6.6. No Material Adverse Change ...............................................................27
Section 6.7. Full Disclosure ..........................................................................27
Section 6.8. Good Title ...............................................................................27
Section 6.9. Litigation and Other Controversies .......................................................27
Section 6.10. Taxes ....................................................................................27
Section 6.11. Approvals ................................................................................28
Section 6.12. Affiliate Transactions ...................................................................28
Section 6.13. Investment Company; Public Utility Holding Company .......................................28
Section 6.14. ERISA ....................................................................................28
Section 6.15. Compliance with Laws .....................................................................28
Section 6.16. Other Agreements .........................................................................29
Section 6.17. No Default ...............................................................................29
SECTION 7. CONDITIONS PRECEDENT ........................................................................29
Section 7.1. All Advances .............................................................................29
Section 7.2. Initial Advance ..........................................................................29
SECTION 8. COVENANTS ................................................................................31
Section 8.1. Maintenance of Business ..................................................................31
Section 8.2. Maintenance of Properties ................................................................31
Section 8.3. Taxes and Assessments ....................................................................31
Section 8.4. Insurance ................................................................................31
Section 8.5. Financial Reports ........................................................................32
Section 8.6. Inspection ...............................................................................34
Section 8.7. Modified Leverage Ratio ..................................................................34
Section 8.8. Debt Service Coverage Ratio ..............................................................34
Section 8.9. Fixed Charge Coverage Ratio ..............................................................34
Section 8.10. Indebtedness for Borrowed Money ..........................................................34
Section 8.11. Liens ....................................................................................35
Section 8.12. Investments, Acquisitions, Loans, Advances and Guaranties ................................36
Section 8.13. Mergers, Consolidations and Sales ........................................................37
Section 8.14. Operating Leases .........................................................................38
Section 8.15. Maintenance of Subsidiaries ..............................................................38
Section 8.16. Dividends and Certain Other Restricted Payments ..........................................38
Section 8.17. ERISA ....................................................................................38
Section 8.18. Compliance with Laws .....................................................................39
Section 8.19. Burdensome Contracts With Affiliates .....................................................39
Section 8.20. No Changes in Fiscal Year ................................................................39
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Section 8.21. Change in the Nature of Business .........................................................39
Section 8.22. New Subsidiaries .........................................................................39
SECTION 9. EVENTS OF DEFAULT AND REMEDIES ..............................................................39
Section 9.1. Events of Default ....................................................................... 39
Section 9.2. Non-Bankruptcy Defaults ..................................................................42
Section 9.3. Bankruptcy Defaults ......................................................................42
SECTION 10. THE AGENT ...................................................................................42
Section 10.1. Appointment and Authorization ............................................................42
Section 10.2. Rights as a Lender .......................................................................43
Section 10.3. Standard of Care .........................................................................43
Section 10.4. Costs and Expenses .......................................................................44
Section 10.5. Indemnity ................................................................................44
Section 10.6. Agent's Relationship with Company ........................................................44
SECTION 11. MISCELLANEOUS ...............................................................................44
Section 11.1. Non-Business Days ........................................................................44
Section 11.2. No Waiver, Cumulative Remedies ...........................................................45
Section 11.3. Waivers, Modifications and Amendments ....................................................45
Section 11.4. Costs and Expenses .......................................................................45
Section 11.5. Documentary Taxes ........................................................................46
Section 11.6. Survival of Representations ..............................................................46
Section 11.7. Survival of Indemnities ..................................................................46
Section 11.8. Participations ...........................................................................46
Section 11.9. Assignment Agreements ....................................................................46
Section 11.10. Notices ..................................................................................47
Section 11.11. Construction .............................................................................48
Section 11.12. Headings .................................................................................48
Section 11.13. Severability of Provisions ...............................................................48
Section 11.14. Counterparts .............................................................................48
Section 11.15. Entire Understanding .....................................................................48
Section 11.16. Extensions of the Facility A Commitments .................................................49
Section 11.17. Binding Nature, Governing Law, Etc .......................................................49
Section 11.18. Submission to Jurisdiction; Waiver of Jury Trial .........................................50
Signature .....................................................................................................50
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Exhibit A - Facility A Revolving Note
Exhibit B - Facility B Revolving Note
Exhibit C - Facility B Term Note
Exhibit D - Compliance Certificate
Exhibit 7.2(c) - Form Opinion of Counsel for Company
Schedule 6.2 - Subsidiaries
Schedule 8.11 - Permitted Debt
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CREDIT AGREEMENT
This Credit Agreement is entered into as of the 5th day of June, 1996,
by and between APAC TeleServices, Inc., an Illinois corporation (the
"Company"), ▇▇▇▇▇▇ Trust and Savings Bank, a national banking association,
individually as a Lender and as an agent (the "Agent"), and the lending
institutions which are or hereafter become signatories hereto ("Lenders").
RECITALS
A. The Company has requested that Lenders loan monies to Company.
B. The Lenders, upon acceptance of this Agreement in writing, will lend
monies and/or make advances, extensions of credit or other financial
accommodations to, on behalf of or for the benefit of the Company pursuant
hereto.
NOW, THEREFORE, in consideration of the Recitals set forth above, which
by this reference are incorporated into the Agreement set forth below, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged and subject to the terms and conditions hereof and on the
basis of the representations and warranties herein set forth, the Company, the
Agent and the Lenders hereby agree to the following:
SECTION 1. THE CREDITS.
Section 1.1. Facility A Credit. (a) Generally. Subject to the terms
and conditions hereof, each Lender severally agrees to extend a revolving
credit (the "Facility A Credit") to the Company which may be availed of by the
Company from time to time during the period from and including the date hereof
to but not including the Facility A Termination Date, at which time the
commitments of the Lenders to extend credit under the Facility A Credit shall
expire. The maximum amount of the Facility A Credit which each Lender agrees
to extend to the Company shall be as set forth opposite such Lender's signature
hereto under the heading "Facility A Commitment", as such amount may be reduced
pursuant hereto. The Facility A Credit may be utilized by the Company in the
form of Facility A Loans, all as more fully hereinafter set forth, provided
that the aggregate principal amount of Facility A Loans outstanding at any one
time shall not exceed the Facility A Commitments. During the period from and
including the date hereof to but not including the Facility A Termination Date,
the Company may use the Facility A Commitments by borrowing, repaying and
reborrowing from time to time Facility A Loans in whole or in part, all in
accordance with the terms and conditions of this Agreement. For purposes of
this Agreement, where a determination of the unused or available amount of the
Facility A Commitments is necessary, the Facility A Loans shall be deemed to
utilize the Facility A Commitments. The obligations of the Lenders hereunder
are several and not joint, and no Lender shall under any circumstances be
obligated to extend credit under the Facility A Credit in excess of its
Facility A Commitment.
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(b) Facility A Loans. Subject to the terms and conditions hereof, the
Facility A Credit may be availed of by the Company in the form of loans
(individually a "Facility A Loan" and collectively the "Facility A Loans").
Except to the extent Section 2 requires otherwise for LIBOR Portions, each
Facility A Loan shall be in a minimum amount of $100,000 or such greater amount
which is an integral multiple of $25,000; and each Facility A Loan shall be
made pro rata by the Lenders in accordance with the amounts of their Facility A
Commitments. Each advance made by a Lender of its pro rata share of a Facility
A Loan shall be made against and evidenced by a Revolving Credit Note of the
Company (individually a "Facility A Note" and collectively the "Facility A
Notes") payable to the order of such Lender in the amount of its Facility A
Commitment, with each Facility A Note to be in the form (with appropriate
insertions) attached hereto as Exhibit A. Each Facility A Note shall be dated
the date of issuance thereof, be expressed to bear interest as set forth in
Section 2 hereof, and be expressed to mature on the Facility A Termination
Date. Without regard to the principal amount of each Facility A Note stated on
its face, the actual principal amount at any time outstanding and owing by the
Company on account thereof shall be the sum of all advances then or theretofore
made thereon less all payments of principal actually received.
Section 1.2. Facility B Credit. (a) Generally. Subject to all of
the terms and conditions hereof, each Lender agrees to extend an additional
revolving credit (the "Facility B Credit") to the Company which may be availed
of by the Company from time to time during the period from and including the
Facility B Activation Date to but not including the Facility B Termination
Date, at which time the commitments of the Lenders to extend credit under the
Facility B Credit shall expire. The maximum amount of the Facility B Credit
which each Lender agrees to extend to the Company shall be as set forth
opposite such Lender's signature hereto under the heading "Facility B
Commitment", as such amount may be reduced pursuant hereto. The Facility B
Credit may be utilized by the Company in the form of Facility B Loans, all as
more fully hereinafter set forth, provided that the aggregate principal amount
of Facility B Loans outstanding at any one time shall not exceed the portion
(if any) of the Facility B Commitments which have become Available Facility B
Commitments as hereinafter set forth. During the period from and including the
Facility B Activation Date to but not including the Facility B Termination
Date, the Company may use the Available Facility B Commitments by borrowing,
repaying and reborrowing from time to time Facility B Loans in whole or in
part, all in accordance with the terms and conditions of this Agreement. For
purposes of this Agreement, where a determination of the unused or available
amount of the Facility B Commitments is necessary, the Facility B Loans shall
be deemed to utilize the Available Facility B Commitments. The obligations of
the Lenders hereunder are several and not joint, and no Lender shall under any
circumstances be obligated to extend credit under the Facility B Credit in
excess of its Available Facility B Commitment.
(b) Facility B Loans. Subject to the terms and conditions hereof, the
Facility B Credit may be availed of by the Company in the form of loans
(individually a "Facility B Loan" and collectively the "Facility B Loans").
Except to the extent Section 2 requires otherwise for LIBOR Portions, each
Facility B Loan shall be in a minimum amount of $1,000,000 or such greater
amount which is an integral multiple of $1,000,000; and each
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Facility B Loan shall be made pro rata by the Lenders in accordance
with the amounts of their Available Facility B Commitments. Each advance made
by a Lender of its pro rata share of a Facility B Loan shall be made against
and evidenced by a Revolving Credit Note of the Company (individually a
"Facility B Note" and collectively the "Facility B Notes") payable to the order
of such Lender in the amount of its Facility B Commitment, with each Facility B
Note to be in the form (with appropriate insertions) attached hereto as Exhibit
B. Each Facility B Note shall be dated the date of issuance thereof, be
expressed to bear interest as set forth in Section 2 hereof, and be expressed
to mature on the Facility B Termination Date. Without regard to the principal
amount of each Facility B Note stated on its face, the actual principal amount
at any time outstanding and owing by the Company on account thereof shall be
the sum of all advances then or theretofore made thereon less all payments of
principal actually received. Borrowings under the Available Facility B
Commitments may be made during the period commencing on the first date (the
"Facility B Activation Date") on which both the Company requests that Facility
B Loans be made available to it and the conditions of Section 1.2(c) hereof
shall have been satisfied and ending on the Facility B Termination Date,
provided that the Lenders will not make Facility B Loans more frequently than
four (4) times per calendar year and no more than once per calendar quarter.
Each Facility B Loan shall mature on the Facility B Termination Date, unless
and to he extent the Company elects to convert all or any portion of such
Facility B Loan to term loans as set forth in Section 1.2(d) hereof.
(c) Activation of Facility B Commitments. On any Business Day between
the date hereof and May 31, 1999, the Company may, upon one (1) Business Day's
prior written notice to the Agent, activate all or any part (but if in part,
then in a minimum amount of $10,000,000 or such greater amount which is an
integral multiple of $1,000,000) of the Facility B Commitments; provided,
however, that no later than the effective date of such activation, (i) the
Company shall have paid to the Agent, for the ratable account of the Lenders, a
fee equal to one-eighth of one percent (1/8 of 1%) of the Facility B
Commitments so activated, (ii) each Lender shall have received a properly
completed and duly executed Facility B Note and (iii) the President or chief
financial officer of the Company shall have furnished the Agent on the date of
such activation with a written certificate (in form and substance reasonably
satisfactory to the Agent) that no Default or Event of Default then exists.
Such portion of the Facility B Commitments shall thereupon become part of the
Available Facility B Commitments, and the Available Facility B Commitment of
each Lender shall increase by its pro rata portion of the Facility B
Commitments so activated. Any portion of the Facility B Commitments not so
activated by May 31, 1999 shall automatically terminate at the close of
business on such date.
(d) Conversion Into Facility B Term Loans. At any time during the
period commencing on the Facility B Activation Date and ending on the Facility
B Termination Date, but in no event more than twice during any one (1) calendar
year, the Company may elect to convert all or any part (but if in part, then in
a minimum amount of $1,000,000 or such greater amount which is an integral
multiple of $100,000, and such conversion of Facility B Loans to be made
ratably as among the Lenders in accordance with their Facility B Commitments)
of the then outstanding Facility B Loans to term loans such that each Lender
shall be deemed to have made a term loan to the Company (individually, for
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each Lender, its "Facility B Term Loan" and collectively the "Facility B Term
Loans") in the amount of such Lender's pro rata share of the amount of Facility
B Loans so converted. Each Facility B Term Loan deemed made by a Lender shall
be evidenced by a Term Loan Note of the Company (individually a "Facility B
Term Note" and collectively the "Facility B Term Notes") payable to the order
of such Lender in an amount equal to the original principal amount of such
Lender's Facility B Term Loan, each Facility B Term Note to be dated the date
of the Facility B Loan evidenced thereby and otherwise in the form (with
appropriate insertions) attached hereto as Exhibit C. Each Facility B Term
Loan shall mature as to principal in consecutive quarterly installments equal
(except for the final installment) to one-twelfth (1/12th) of the original
principal amount of such Facility B Term Loan, commencing on the last day (such
last day, for each Facility B Term Loan, being herein referred to as the
"Commencement Date" for such Facility B Term Loan) of the calendar quarter
during which such Facility B Term Loan was made and continuing on the last of
each and every calendar quarter thereafter, with the final installment to be in
the amount of all principal not sooner paid and due on the earlier of (x) the
third anniversary date of the relevant Commencement Date or (y) May 31, 2001.
(e) Reduction in Facility B Commitments From Term Loans. The principal
amount of each Facility B Term Loan made by a Lender shall concurrently and
permanently reduce by like amount the activated portion of such Lender's
Facility B Commitment (such Lender's Available Facility B Commitment) and hence
also permanently reduce by like amount the maximum principal amount of Facility
B Loans available under such Lender's Facility B Commitment, and no amount paid
or prepaid on any Facility B Term Loan may be borrowed again.
Section 1.3. Manner and Disbursement of Loans. The Company shall give
written or telephonic notice to the Agent (which notice shall be irrevocable
once given and, if given by telephone, shall be promptly confirmed in writing)
by no later than 11:00 a.m. (Chicago time) one (1) Business Day prior to the
date the Company requests that any Loan be made to it under the Commitments,
and the Agent shall promptly notify each Lender of the Agent's receipt of each
such notice. Each such notice shall specify the date of the Loan requested
(which must be a Business Day) and the amount of such Loan. Each Loan shall
initially constitute part of the applicable Domestic Rate Portion except to the
extent the Company has otherwise timely elected as provided in Section 2
hereof. The Company agrees that the Agent may rely upon any written or
telephonic notice given by any person the Agent in good faith believes is an
Authorized Representative without the necessity of independent investigation
and, in the event any telephonic notice conflicts with the written
confirmation, such telephonic notice shall govern if the Agent and the Lenders
have acted in reliance thereon. Not later than 1:00 p.m. (Chicago time) on the
date specified for any Loan to be made by a Lender hereunder, such Lender shall
make the proceeds of its pro rata share of such Loan available to the Agent in
Chicago, Illinois in immediately available funds. Subject to the provisions of
Section 7 hereof, the proceeds of each Loan shall be made available to the
Company at the principal office of the Agent in Chicago, Illinois, in
immediately available funds, upon receipt by the Agent from each Lender of its
pro rata share of such Loan. Unless the Agent shall have been notified by a
Lender prior to 1:00 p.m. (Chicago time) on the date a Loan is to be made
hereunder that such Lender does
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not intend to make its pro rata share of such Loan available to the
Agent, the Agent may assume that such Lender has made such share available to
the Agent on such date and the Agent may in reliance upon such assumption make
available to the Company a corresponding amount. If such corresponding amount
is not in fact made available to the Agent by such Lender and the Agent has
made such amount available to the Company, the Agent shall be entitled to
receive such amount from such Lender forthwith upon the Agent's demand,
together with interest thereon in respect of each day during the period
commencing on the date such amount was made available to the Company and ending
on but excluding the date the Agent recovers such amount at a rate per annum
equal to the effective rate charged to the Agent for overnight federal funds
transactions with member banks of the federal reserve system for each day as
determined by the Agent (or in the case of a day which is not a Business Day,
then for the preceding day). If such amount is not received from such Lender
by the Agent immediately upon demand, the Company will, on demand, repay to the
Agent the proceeds of the Loan attributable to such Lender with interest
thereon at a rate per annum equal to the interest rate applicable to the
relevant Loan, but without such payment being considered a payment or
prepayment of a LIBOR Portion, so that the Company will have no liability under
Section 2.9 hereof with respect to such payment.
SECTION 2. INTEREST AND CHANGE IN CIRCUMSTANCES.
Section 2.1. Interest Rate Options.
(a) Portions. Subject to the terms and conditions of this Section 2,
(i) portions of the principal indebtedness evidenced by the Notes (all of the
indebtedness evidenced by a particular class of Notes bearing interest at the
same rate for the same period of time being hereinafter referred to as a
"Portion") may, at the option of the Company, bear interest with reference to
the Domestic Rate ("Domestic Rate Portions") or with reference to the Adjusted
LIBOR ("LIBOR Portions"), and Portions may be converted from time to time from
one basis to another. All of the indebtedness evidenced by a particular class
of Notes which is not part of a LIBOR Portion shall constitute a single
Domestic Rate Portion of such class of Notes. All of the indebtedness
evidenced by a particular class of Notes which bears interest with reference to
a particular Adjusted LIBOR for a particular Interest Period shall constitute a
single LIBOR Portion of such class of Notes. There shall not be more than
twenty (20) LIBOR Portions applicable to all the Notes outstanding at any one
time (taken together), and each Lender shall have a ratable interest in each
Portion. Anything contained herein to the contrary notwithstanding, the
obligation of the Lenders to create, continue or effect by conversion any LIBOR
Portion shall be conditioned upon the fact that at the time no Default or Event
of Default shall have occurred and be continuing. The Company hereby promises
to pay interest on each Portion at the rates and times specified in this
Section 2.
(b) Domestic Rate Portion. Each Domestic Rate Portion shall bear interest
at the rate per annum determined by adding the Applicable Margin to the
Domestic Rate as in effect from time to time, provided that if a Domestic Rate
Portion or any part thereof is not paid when due (whether by lapse of time,
acceleration or otherwise) such Portion shall thereafter bear interest, whether
before or after judgment, until payment in full thereof (or
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such earlier time, if any, as such default in payment shall be (x) cured within
the grace period provided therefor in Section 9.1(a) hereof or (y) waived in
writing by the Lenders in their sole discretion) at the rate per annum
determined by adding 2% to the interest rate which would otherwise be applicable
thereto from time to time. Interest on each Domestic Rate Portion shall be
payable quarter-annually in arrears on the last day of each March, June,
September and December in each year (commencing on the first of such dates after
the date hereof) and at maturity of the applicable Notes, and interest after
maturity (whether by lapse of time, acceleration or otherwise) shall be due and
payable upon demand. Any change in the interest rate on the Domestic Rate
Portions resulting from a change in the Domestic Rate shall be effective on the
date of the relevant change in the Domestic Rate.
(c) LIBOR Portions. Each LIBOR Portion shall bear interest for each
Interest Period selected therefor at a rate per annum determined by adding the
Applicable Margin to the Adjusted LIBOR for such Interest Period, provided that
if any LIBOR Portion is not paid when due (whether by lapse of time,
acceleration or otherwise) such Portion shall thereafter bear interest, whether
before or after judgment, until payment in full thereof (but in no event after
such time, if any, whether during or after the Interest Period then applicable
thereto, as such default in payment shall be (x) cured within the grace period
provided therefor in Section 9.1(a) hereof or (y) waived in writing by the
Lenders in their sole discretion) (1) through the end of the Interest Period
then applicable thereto at the rate per annum determined by adding 2% to the
interest rate which would otherwise be applicable thereto, and (2) if such
default in payment shall not have yet been so cured or waived, effective at the
end of such Interest Period, such LIBOR Portion shall automatically be
converted into and added to the applicable Domestic Rate Portion and shall
thereafter bear interest at the interest rate applicable to such Domestic Rate
Portion after default. Interest on each LIBOR Portion shall be due and payable
on the last day of each Interest Period applicable thereto and, with respect to
any Interest Period applicable to a LIBOR Portion in excess of three (3)
months, on the date occurring every three (3) months after the date such
Interest Period began and at the end of such Interest Period, and interest
after maturity (whether by lapse of time, acceleration or otherwise) shall be
due and payable upon demand. The Company shall notify the Agent on or before
1:00 p.m. (Chicago time) on the third Business Day preceding the end of an
Interest Period applicable to a LIBOR Portion whether such LIBOR Portion is to
continue as a LIBOR Portion, in which event the Company shall notify the Agent
of the new Interest Period selected therefor, and in the event the Company shall
fail to so notify the Agent, such LIBOR Portion shall automatically be
converted into and added to the applicable Domestic Rate Portion as of and on
the last day of such Interest Period. The Agent shall promptly notify each
Lender of each notice received from the Company pursuant to the foregoing
provision.
Section 2.2. Minimum LIBOR Portion Amounts. Each LIBOR Portion
shall be in an amount equal to $1,000,000 or such greater amount which is an
integral multiple of $250,000.
Section 2.3. Computation of Interest. All interest on the Notes
shall be computed on the basis of a year of 360 days for the actual number of
days elapsed.
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Section 2.4. Manner of Rate Selection. The Company shall notify the
Agent by 1:00 p.m. (Chicago time) at least three (3) Business Days prior to the
date designated by the Company as the effective date that any LIBOR Portion be
created or that any part of the applicable Domestic Rate Portion be converted
into a LIBOR Portion. Each such notice shall specify in each instance the
amount of the LIBOR Portion to be created or effected by conversion, as the
case may be, and the Interest Period selected therefor, and the Agent shall
promptly notify each Lender of each notice received from the Company pursuant
to the foregoing provision. If any request is made to convert a LIBOR Portion
into the relevant Domestic Rate Portion, such conversion shall only be made so
as to become effective as of the last day of the Interest Period applicable
thereto. All requests for the creation, continuance and conversion of Portions
under this Agreement shall be irrevocable. Such requests may be written or
oral and the Agent is hereby authorized to honor telephonic requests for
creations, continuances and conversions received by it from any person the
Agent in good faith believes to be an Authorized Representative without the
necessity of independent investigation, the Company hereby indemnifying the
Agent and the Lenders from any liability or loss ensuing from so acting.
Section 2.5. Change of Law. Notwithstanding any other provisions of
this Agreement or any Note, if at any time any Lender shall determine in good
faith that any change after the date hereof in applicable laws, treaties or
regulations or any change after the date hereof in the interpretation thereof
of any of the foregoing by any governmental authority charged with the
administration thereof or any central bank or any fiscal, monetary or other
authority having jurisdiction over such Lender or its lending branch or the
LIBOR Portions contemplated by this Agreement (whether or not having the force
of law) makes it unlawful for such Lender to create or continue to maintain any
LIBOR Portion, it shall promptly so notify the Agent (which shall in turn
promptly notify the Company and the other Lenders) and the obligation of such
Lender to create, continue or maintain any such LIBOR Portion under this
Agreement shall terminate until it is no longer unlawful for such Lender to
create, continue or maintain such LIBOR Portion. The Company, within five (5)
days (or sooner if applicable law so requires) after written demand from the
affected Lender or the Agent, shall, if the continued maintenance of any such
LIBOR Portion is unlawful, thereupon prepay the outstanding principal amount of
the affected LIBOR Portion, together with all interest accrued thereon and all
other amounts payable to affected Lender with respect thereto under this
Agreement; provided, however, that the Company may elect to convert the
principal amount of the affected Portion into another type of Portion available
hereunder, subject to the terms and conditions of this Agreement.
Section 2.6. Unavailability of Deposits or Inability to Ascertain
Adjusted LIBOR. Notwithstanding any other provision of this Agreement or any
Note, if prior to the commencement of any Interest Period, (i) any Lender shall
determine in good faith that deposits in the amount of any LIBOR Portion
scheduled to be outstanding during such Interest Period are not readily
available to such Lender in the relevant market, or, (ii) by reason of
circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining Adjusted LIBOR, then such Lender shall promptly give
notice thereof to the Agent (which shall in turn promptly notify the Company
and the other
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Lenders) and the obligations of the Lenders to create, continue
or effect by conversion any such LIBOR Portion in such amount and for such
Interest Period shall terminate until deposits in such amount and for the
Interest Period selected by the Company shall again be readily available in the
relevant market and adequate and reasonable means exist for ascertaining
Adjusted LIBOR.
Section 2.7. Taxes and Increased Costs. With respect to any LIBOR
Portion, if any Lender shall determine in good faith that any change in any
applicable law, treaty, regulation or guideline (including, without limitation,
Regulation D of the Board of Governors of the Federal Reserve System) or any
new law, treaty, regulation or guideline, or any new interpretation of any of
the foregoing by any governmental authority charged with the administration
thereof or any central bank or other fiscal, monetary or other authority having
jurisdiction over such Lender or its lending branch or the LIBOR Portions
contemplated by this Agreement (whether or not having the force of law), shall:
(i) impose, increase, or deem applicable any reserve, special deposit
or similar requirement against assets held by, or deposits in or for the
account of, or loans by, or any other acquisition of funds or
disbursements by, such Lender which is not in any instance already
accounted for in computing the interest rate applicable to such LIBOR
Portion;
(ii) subject such Lender, any LIBOR Portion or a Note to the extent it
evidences such a Portion to any tax (including, without limitation, any
United States interest equalization tax or similar tax however named
applicable to the acquisition or holding of debt obligations and any
interest or penalties with respect thereto), duty, charge, stamp tax, fee,
deduction or withholding in respect of this Agreement, any LIBOR Portion
or a Note to the extent it evidences such a Portion, except such taxes as
may be measured by the overall net income or gross receipts of such Lender
or its lending branches and imposed by the jurisdiction, or any political
subdivision or taxing authority thereof, in which such Lender's principal
executive office or its lending branch is located;
(iii) change the basis of taxation of payments of principal and
interest due from the Company to such Lender hereunder or under a Note to
the extent it evidences any LIBOR Portion (other than by a change in
taxation of the overall net income or gross receipts of such Lender or its
lending branches); or
(iv) impose on such Lender any penalty with respect to the foregoing or
any other condition regarding this Agreement, any LIBOR Portion, or its
disbursement, or a Note to the extent it evidences any LIBOR Portion;
and such Lender shall determine in good faith that the result of any of the
foregoing is to increase the cost (whether by incurring a cost or adding to a
cost) to such Lender of creating or maintaining any LIBOR Portion hereunder or
to reduce the amount of principal or interest received or receivable by such
Lender (without benefit of, or credit for, any prorations, exemption, credits
or other offsets available under any such laws, treaties,
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regulations, guidelines or interpretations thereof), then the Company
shall pay within sixty (60) days after written demand to the Agent for the
account of such Lender from time to time as specified by such Lender such
additional amounts as such Lender shall reasonably determine are sufficient to
compensate and indemnify it for such increased cost or reduced amount;
provided, however, that the Company shall not be obligated to pay any such
amount or amounts to the extent such additional cost or payment was incurred or
paid by such Lender more than ninety (90) days prior to the date of the
delivery of the certificate referred to in the immediately following sentence
(nothing herein to impair or otherwise affect the Company's liability hereunder
for costs or payments subsequently incurred or paid by such Lender). If a
Lender makes such a claim for compensation, it shall provide to the Company
(with a copy to the Agent) substantially concurrently with such demand a
certificate setting forth the computation of the increased cost or reduced
amount as a result of any event mentioned herein in reasonable detail and such
certificate shall be conclusive if reasonably determined.
Section 2.8. Change in Capital Adequacy Requirements. If any Lender
shall determine that the adoption after the date hereof of any applicable law,
rule or regulation regarding capital adequacy, or any change in any existing
law, rule or regulation, or any change in the interpretation or administration
thereof by any governmental authority, central bank or comparable agency
charged with the interpretation or administration thereof, or compliance by
such Lender (or any of its branches) or any corporation controlling such Lender
with any request or directive regarding capital adequacy (whether or not having
the force of law) of any such authority, central bank or comparable agency, has
or would have the effect of reducing the rate of return on such Lender's or
such corporation's capital, as the case may be, as a consequence of such
Lender's obligations hereunder or for the credit which is the subject matter
hereof to a level below that which such Lender or such corporation would have
achieved but for such adoption, change or compliance (taking into consideration
such Lender's or such corporation's policies with respect to liquidity and
capital adequacy) by an amount deemed by such Lender to be material, then from
time to time, within thirty (30) days after written demand by such Lender, the
Company shall pay to the Agent for the account of such Lender such additional
amount or amounts reasonably determined by such Lender as will compensate such
Lender for such reduction; provided, however, that the Company shall not be
obligated to compensate such Lender to the extent its rate of return was so
reduced more than ninety (90) days prior to the date of such demand (nothing
herein to impair or otherwise affect the Company's liability hereunder to
compensate for subsequent reductions in such Lender's rate of return).
Section 2.9. Funding Indemnity. (a) In the event any Lender shall
incur any loss, cost or expense (including, without limitation, any loss
(including loss of profit), cost or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired or contracted
to be acquired by such Lender to fund or maintain its part of any LIBOR Portion
or the relending or reinvesting of such deposits or other funds or amounts paid
or prepaid to such Lender) as a result of:
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(i) any payment of a LIBOR Portion on a date other than the last day of
the then applicable Interest Period for any reason, whether before or
after default, and whether or not such payment is required by any
provisions of this Agreement; or
(ii) any failure by the Company to create, borrow, continue or effect
by conversion a LIBOR Portion on the date specified in a notice given
pursuant to this Agreement;
then, upon the demand of such Lender, the Company shall pay to the
Agent for the account of such Lender such amount as will reimburse such Lender
for such loss, cost or expense.
(b) If a Lender requests such a reimbursement under clause (a) above, it
shall provide to the Company (with a copy to the Agent) a certificate setting
forth the computation of the loss, cost or expense giving rise to the request
for reimbursement in reasonable detail and such certificate shall be conclusive
if reasonably determined; provided, however, that the Company shall not be
obligated to pay any such amount or amounts to the extent such loss, cost or
expense was incurred by such Lender more than ninety (90) days prior to the
date of the delivery of such certificate (nothing herein to impair or otherwise
affect the Company's liability hereunder to compensate for any subsequent loss,
cost, or expense incurred by such Lender).
Section 2.10. Lending Branch. Each Lender may, at its option, elect
to make, fund or maintain its pro rata share of the Loans hereunder at the
branches or offices specified on the signature pages hereof or on any
Assignment Agreement executed and delivered pursuant to Section 11.9 hereof or
at such of its branches or offices as such Lender may from time to time elect.
To the extent reasonably possible, a Lender shall designate an alternate branch
or funding office with respect to its pro rata share of the LIBOR Portions to
reduce any liability of the Company to such Lender under Section 2.7 hereof or
to avoid the unavailability of an interest rate option under Section 2.6
hereof, so long as such designation is not otherwise disadvantageous in any
material respect to the Lender.
Section 2.11. Discretion of Lenders as to Manner of Funding.
Notwithstanding any provision of this Agreement to the contrary, each Lender
shall be entitled to fund and maintain its funding of all or any part of its
Notes in any manner it sees fit, it being understood, however, that for the
purposes of this Agreement all determinations hereunder (including, without
limitation, determinations under Sections 2.6, 2.7 and 2.9 hereof) shall be
made as if each Lender had actually funded and maintained each LIBOR Portion
during each Interest Period applicable thereto through the purchase of deposits
in the relevant market in the amount of its pro rata share of such LIBOR
Portion, having a maturity corresponding to such Interest Period, and bearing
an interest rate equal to the LIBOR for such Interest Period.
Section 2.12. Lender's Duty to Mitigate. Each Lender agrees that, as
promptly as practicable after it becomes aware of the occurrence of an event or
the existence of a condition that would cause it to be affected under Section
2.5, 2.6 or 2.7 hereof, such Lender will, after notice to the Company, to the
extent not inconsistent with such Lender's
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internal policies and customary business practices, use its best
efforts to make, fund or maintain the affected LIBOR Portion through another
lending office of such Lender if as a result thereof the unlawfulness which
would otherwise require payment of such Portion pursuant to Section 2.5 hereof
would cease to exist or the circumstances which would otherwise terminate such
Lender's obligation to make such Portion under Section 2.6 hereof would cease
to exist or the increased costs which would otherwise be required to be paid in
respect of such Portion pursuant to Section 2.7 hereof would be materially
reduced, and if, as determined by such Lender, in its sole discretion, the
making, funding or maintaining of such Portion through such other lending
office would not otherwise adversely affect such Portion or such Lender. The
Company hereby agrees to pay all reasonable expenses incurred by each such
Lender in utilizing another lending office pursuant to this Section 2.12.
SECTION 3. FEES, PREPAYMENTS AND TERMINATIONS.
Section 3.1. Facility A Commitment Fee. For the period from and
including the date hereof to but not including the Facility A Termination Date,
the Company shall pay to the Agent for the account of the Lenders a commitment
fee at the rate of one-eighth of one percent (1/8 of 1%) per annum (computed on
the basis of a year of 360 days for the actual number of days elapsed) on the
average daily unused portion of the Facility A Commitments. Such commitment
fee accruing during each calendar quarter shall be payable quarter-annually in
arrears on the 15th day of the immediately following calendar quarter
(commencing July 15, 1996) and on the Facility A Termination Date.
Section 3.2. Facility B Commitments.
(a) Facility B Facility Fee. For the period from and including the date
hereof to but not including the Facility B Termination Date, the Company shall
pay to the Agent for the account of the Lenders a facility fee at the rate of
one-eighth of one percent (1/8 of 1%) per annum (computed on the basis of a
year of 360 days for the actual number of days elapsed) on the Facility B
Commitments to the extent the same have not become Available Facility B
Commitments. Such facility fee accruing during each calendar quarter shall be
payable quarter-annually in arrears on the 15th day of the immediately
following calendar quarter (commencing July 15, 1996) and on the Facility B
Termination Date.
(b) Facility B Commitment Fee. For the period from and including the
Facility B Activation Date to but not including the Facility B Termination
Date, the Company shall pay to the Agent for the account of the Lenders a
commitment fee at the rate of one-eighth of one percent (1/8 of 1%) per annum
(computed on the basis of a year of 360 days for the actual number of days
elapsed) on the daily unused portion of the Available Facility B Commitments.
Such facility fee accruing during each calendar quarter shall be payable
quarter-annually in arrears on the 15th day of the immediately following
calendar quarter (commencing on the first of such dates occurring after the
Facility B Activation Date) and on the Facility B Termination Date.
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Section 3.3. Agent's Fee. On the date hereof, and on the date
occurring on each anniversary of the date hereof when any credit, or commitment
to extend credit, is outstanding hereunder, the Company shall pay to the Agent,
for its own use and benefit, an Agent's fee as mutually agreed upon by the
Company and the Agent.
Section 3.4. Defaulting Lender. Notwithstanding anything herein to
the contrary, any commitment or facility fee accrued with respect to any of the
Commitments of a Defaulting Lender during the period prior to the time such
Lender became a Defaulting Lender and unpaid at such time shall not be payable
by the Company so long as such Lender shall be a Defaulting Lender except to
the extent that such commitment or facility fee shall otherwise have been due
and payable by the Company prior to such time; and provided further that no
commitment or facility fee shall accrue on any of the Commitments of a
Defaulting Lender so long as such Lender shall be a Defaulting Lender.
Section 3.5. Voluntary Prepayments. The Company shall have the
privilege of prepaying the Notes in whole or in part (but if in part, then in a
minimum amount of $100,000 or such greater amount which is an integral multiple
of $100,000 as to any particular class of Notes being prepaid) at any time upon
one (1) Business Day's prior notice to the Agent (such notice if received
subsequent to 11:00 a.m. (Chicago time) on a given day to be treated as though
received at the opening of business on the next Business Day), which shall
promptly so notify the Lenders, by paying to the Agent for the account of the
Lenders the principal amount to be prepaid and (i) if such a prepayment prepays
any particular class of Notes in full, accrued interest thereon to the date of
prepayment, (ii) if such a prepayment prepays the Facility A Notes in full and
is accompanied by the termination in whole of the Facility A Commitments,
accrued interest thereon to the date of prepayment plus any facility or
commitment fee which has accrued on such Commitments and is unpaid, (iii) if
such a prepayment prepays any particular class of Facility B Notes in full and
is accompanied by the termination in whole of the Facility B Commitments,
accrued interest thereon to the date of prepayment plus any facility or
commitment fee which has accrued on such Commitments and is unpaid and (iv) any
amounts due to the Lenders under Section 2.9 hereof.
Section 3.6. Terminations. The Company shall have the right at any
time and from time to time, upon prior notice to the Agent (which shall
promptly so notify the Lenders), effective as of the close of any calendar
quarter specified in such notice ending more than thirty (30) days after the
Agent's receipt of such notice, to ratably terminate without premium or penalty
and in whole or in part (but if in part, then in an aggregate amount not less
than $500,000 or such greater amount which is an integral multiple of $100,000)
the Facility A Commitments or Facility B Commitments (including the Available
Facility B Commitments), provided that (i) the Facility A Commitments may not
be reduced to an amount less than the aggregate principal amount of the
Facility A Loans then outstanding under such Commitments and (ii) the Available
Facility B Commitments (and hence the Facility B Commitments) may not be
reduced to an amount less than the aggregate principal amount of the Facility B
Loans then outstanding under such Commitments. Any termination of Commitments
pursuant to this Section 3.4 may not be reinstated.
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SECTION 4. PAYMENTS, NOTATIONS AND REPLACEMENTS OF LENDERS.
Section 4.1. Place and Application of Payments. All payments of
principal, interest, fees and all other Obligations payable hereunder and under
the other Loan Documents shall be made to the Agent at its office at ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ (or at such other place as the Agent may
specify) on the date any such payment is due and payable. Payments received by
the Agent after 11:00 a.m. (Chicago time) shall be deemed received as of the
opening of business on the next Business Day. All such payments shall be made
in lawful money of the United States of America, in immediately available funds
at the place of payment, without set-off or counterclaim and without reduction
for, and free from, any and all present or future taxes, levies, imposts,
duties, fees, charges, deductions, withholdings, restrictions and conditions of
any nature imposed by any government or any political subdivision or taxing
authority thereof (but excluding any taxes imposed on or measured by the net
income of any Lender). No amount paid or prepaid on the Facility B Term Notes
may be reborrowed, and partial prepayments of the Facility B Term Notes shall
be applied in the inverse order of their maturities. Except as herein
provided, all payments shall be received by the Agent for the ratable account
of the Lenders and shall be promptly distributed by the Agent ratably to the
Lenders. Unless the Company otherwise directs, principal payments on any
particular class of Notes shall be first applied to the Domestic Rate Portion
(if any) of such Notes until payment in full thereof, with any balance applied
to the LIBOR Portions (if any) of such Notes in the order in which their
Interest Periods expire.
Anything contained herein to the contrary notwithstanding, all payments and
collections received in respect of the Obligations, in each instance, by the
Agent or any of the Lenders after the occurrence of an Event of Default shall
be remitted to the Agent and distributed as follows:
(a) first, to the payment of any outstanding costs and expenses
incurred by the Agent in protecting, preserving or enforcing rights under
this Agreement or any of the other Loan Documents, and in any event
including all costs and expenses of a character which the Company has
agreed to pay under Section 11.4 hereof (such funds to be retained by the
Agent for its own account unless it has previously been reimbursed for
such costs and expenses by the Lenders, in which event such amounts shall
be remitted to the Lenders to reimburse them for payments theretofore made
to the Agent);
(b) second, to the payment of any outstanding interest or other fees
or amounts due under this Agreement or any of the other Loan Documents
other than for principal, pro rata as among the Agent and the Lenders
in accord with the amount of such interest and other fees or amounts
owing each;
(c) third, to the payment of the principal of the Notes, pro rata as
among the Lenders in accord with the then respective unpaid principal
balances of the Notes;
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(d) fourth, to the Agent and the Lenders pro rata in accord with the
amounts of any other Obligations owing to them (if any) unless and until
all such Obligations have been fully paid and satisfied; and
(e) fifth, to the Company or to whoever else applicable law shall
require.
Section 4.2. Notations. All Loans made against a Note, the status of all
amounts evidenced by a Note as constituting part of the Domestic Rate Portion
or a LIBOR Portion, and, in the case of any LIBOR Portion, the rates of
interest and Interest Periods applicable to such Portions shall be recorded by
each Lender on its books and records or, at its option in any instance,
endorsed on a schedule to its Note and the unpaid principal balance and status,
rates and Interest Periods so recorded or endorsed by such Lender shall be
prima facie evidence in any court or other proceeding brought to enforce such
Note of the principal amount remaining unpaid thereon, the status of the Loans
evidenced thereby and the interest rates and Interest Periods applicable
thereto; provided that the failure of a Lender to record any of the foregoing
shall not limit or otherwise affect the obligation of the Company to repay the
principal amount of each Note together with accrued interest thereon. Prior to
any negotiation of a Note, a Lender shall record on a schedule thereto the
status of all amounts evidenced thereby as constituting part of the applicable
Domestic Rate Portion or a LIBOR Portion or in the case of the CapEx Term
Notes, a Treasury Rate Portion and, in the case of any LIBOR Portion, the rates
of interest and the Interest Periods applicable thereto. As soon as
practicable, but in no event later than one (1) Business Day after prior
written notice from the Company to each Lender, such Lender shall provide to
the Company a written payoff letter from such Lender setting forth the amount
required to pay the Notes in full as of the date or dates requested by the
Company and any other amounts due by the Company hereunder (with a per diem
amount owing thereafter).
Section 4.3. Replacement of Lender. (a) In the event that (x) the
Company receives from a Lender a certificate requesting an amount be paid to
such Lender under Section 2.7, 2.8 or 2.9 hereof and the Required Lenders have
not similarly made requests for payment arising out of the same circumstances
or (y) the obligation of any Lender to make or maintain any LIBOR Portion has
terminated under Section 2.5 or 2.6 hereof and the obligations of the Required
Lenders to make or maintain LIBOR Portions have not similarly terminated by
reason of the same circumstances or (z) any Lender becomes a Defaulting Lender,
then the Company may request other Lenders hereunder to assume in full the
Commitments then in effect of the Lender requesting such amount be paid or
whose obligations with respect to LIBOR Portions have so terminated or of such
Defaulting Lender, as the case may be (such Lender in each case being herein
referred to as the "Replaceable Lender"), and to purchase the Notes issued to
the Replaceable Lender at a price equal to the outstanding principal amount of
such Notes and the Replaceable Lender's share of any accrued and unpaid
interest on such Notes plus accrued and unpaid commitment fees owed to the
Replaceable Lender, and if any Lender or Lenders in their sole discretion agree
so to assume in full the Commitments of the Replaceable Lender (each an
"Assuming Lender"), and after payment by the Company to the Replaceable Lender
of all amounts due under this Agreement to such Lender (including any amount
specified as due in a certificate submitted under Section 2.7, 2.8 or 2.9
hereof) not so paid by the Assuming Lender, then
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such assumption shall take place in the manner set forth in subsection (b)
below. In the event no Lender or Lenders agrees to assume in full the
Commitments of the Replaceable Lender, then the Company may nominate one or
more Lenders not then party to this Agreement so to assume in full the
Commitments of the Replaceable Lender, and if such nominated Lender or Lenders
are acceptable to the Required Lenders (excluding the Replaceable Lender), such
assumption shall take place in the manner set forth in subsection (b) below and
each such Lender or Lenders shall become a Lender hereunder (each a "New
Lender") and the Replaceable Lender shall no longer be a party hereto or have
any rights hereunder.
(b) In the event a Replaceable Lender's Commitments are to be assumed in
full by an Assuming Lender or a New Lender, then such assumption shall take
place on a date acceptable to the Company, the Replaceable Lender and the
Assuming Lender or New Lender, as the case may be, and such assumption shall
take place through the payment of all amounts due under this Agreement to the
Replaceable Lender and the execution of such instruments and documents as
shall, in the reasonable opinion of the Agent, be reasonably necessary or
appropriate for the Assuming Lender or New Lender to assume in full the
Commitments of the Replaceable Lender (including, without limitation, the
issuance of new Notes and the execution of an amendment hereto making any New
Lender a party hereto). In the event no Assuming Lender or New Lender agrees
to assume in full the Commitments of the Replaceable Lender, then such
Replaceable Lender shall remain a party hereto and its Commitments shall remain
in effect.
(c) The rights and remedies against a Defaulting Lender under this
Agreement, including without limitation this Section 4.3, are in addition to
other rights and remedies that the Company may have against such Defaulting
Lender with respect to any Loan which such Defaulting Lender has not funded,
and that the Agent, or any Lender may have against such Defaulting Lender with
respect to any such Loan.
SECTION 5. DEFINITIONS; INTERPRETATION.
Section 5.1. Definitions. The following terms when used herein shall
have the following meanings:
"Adjusted LIBOR" means a rate per annum determined by the Agent in
accordance with the following formula:
LIBOR
Adjusted LIBOR = ----------------------
100%-Reserve Percentage
"Reserve Percentage" means, for the purpose of computing Adjusted LIBOR, the
maximum rate of all reserve requirements (including, without limitation, any
marginal, emergency, supplemental or other special reserves) imposed by the
Board of Governors of the Federal Reserve System (or any successor) under
Regulation D on Eurocurrency liabilities (as such term is defined in Regulation
D) for the applicable Interest Period as of the first day of such Interest
Period, but subject to any amendments to such reserve requirement by such Board
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or its successor, and taking into account any transitional adjustments thereto
becoming effective during such Interest Period. For purposes of this
definition, LIBOR Portions shall be deemed to be Eurocurrency liabilities as
defined in Regulation D without benefit of or credit for prorations, exemptions
or offsets under Regulation D. "LIBOR" means, for each Interest Period, (a)
the LIBOR Index Rate for such Interest Period, if such rate is available, and
(b) if the LIBOR Index Rate cannot be determined, the arithmetic average of the
rates of interest per annum (rounded upward, if necessary, to the nearest
1/100th of 1%) at which deposits in U.S. Dollars in immediately available funds
are offered to the Agent at 11:00 a.m. (London, England time) two (2) Business
Days before the beginning of such Interest Period by three (3) or more major
banks in the interbank eurodollar market selected by the Agent for a period
equal to such Interest Period and in an amount equal or comparable to the
applicable LIBOR Portion scheduled to be outstanding from the Agent during such
Interest Period. "LIBOR Index Rate" means, for any Interest Period, the rate
per annum (rounded upwards, if necessary, to the next higher one
hundred-thousandth of a percentage point) for deposits in U.S. Dollars for a
period equal to such Interest Period which appears on the Telerate Page 3750 as
of 11:00 a.m. (London, England time) on the date two Business Days before the
commencement of such Interest Period. "Telerate Pge 3750" means the display
designated as "Page 3750" on the Telerate Service (or such other page as may
replace Page 3750 on that service or such other service as may be nominated by
the British Bankers' Association as the information vendor for the purpose of
displaying British Banker's Association Interest Settlement Rates for U.S.
Dollar deposits). Each determination of LIBOR made by the Agent shall be
conclusive and binding on the Company and the Lenders absent manifest error.
"Affiliate" means any Person directly or indirectly controlling or
controlled by, or under direct or indirect common control with, another Person.
A Person shall be deemed to control another Person for the purposes of this
definition if such Person possesses, directly or indirectly, the power to
direct, or cause the direction of, the management and policies of the other
Person, whether through the ownership of voting securities, common directors,
trustees or officers, by contract or otherwise; provided that, in any event for
purposes of this definition, any Person that owns, directly or indirectly, 5%
or more of the securities having the ordinary voting power for the election of
directors or governing body of a corporation or 5% or more of the partnership
or other ownership interests of any other Person (other than as a limited
partner of such other Person) will be deemed to control such corporation or
other Person.
"Agent" means ▇▇▇▇▇▇ Trust and Savings Bank and any successor thereto
appointed pursuant to Section 10.1 hereof.
"Agreement" means this Credit Agreement, as the same may be amended,
modified or restated from time to time in accordance with the terms hereof.
"Applicable Margin" means the rate specified below, subject to
quarterly adjustment as hereinafter provided:
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When Following Applicable Applicable
Status Exists For Margin Margin
Any Margin For Domestic For LIBOR
Determination Rate Portions Portions
Date Is: Is:
Level I Status 0% 1.00%
Level II Status 0% 0.75%
Level III Status 0% 0.50%
provided, however, that all of the foregoing is subject to the following:
(i) the initial Applicable Margin in effect through the first Margin
Determination Date shall be the Applicable Margin for Level III Status;
(ii) on or before the date that is thirty (30) Business Days after the
date on which the Company has delivered a Compliance Certificate to the
Agent for a given accounting period pursuant to Section 8.5 hereof (such
date that is thirty (30) Business Days after the date on which the Company
delivered a Compliance Certificate to the Agent being herein referred to
as the "Margin Determination Date"), the Agent shall determine whether
Level I Status, Level II Status or Level III Status exists as of the close
of the applicable accounting period, based upon the Compliance Certificate
and financial statements delivered to the Agent under Section 8.5 hereof
for such accounting period, and shall promptly notify the Company and the
Lenders of such determination and of any change in the Applicable Margin
resulting therefrom. Any such change in the Applicable Margin shall be
effective as of such Margin Determination Date, with such new Applicable
Margin to continue in effect until the next Margin Determination Date. If
the Company has not delivered a Compliance Certificate by the date such
Compliance Certificate is required to be delivered under Section 8.5
hereof, until a Compliance Certificate is delivered before the next Margin
Determination Date, the Applicable Margin shall be the Applicable Margin
for Level I Status. If the Company subsequently delivers a Compliance
Certificate before the next Margin Determination Date, the Applicable
Margin established by such Compliance Certificate shall take effect from
the date of delivery until the next Margin Determination Date; and
(iii) if and so long as any Event of Default has occurred and is
continuing hereunder, notwithstanding anything herein to the contrary, the
Applicable Margin shall be the Applicable Margin for Level I Status.
"Authorized Representative" means the President, Chief Executive
Officer, Chief Financial Officer, Senior Vice President-Finance of the Company
and those other persons (if any) shown on the list of officers provided by the
Company pursuant to Section 7.2(a) hereof or on any update of any such list
provided by the Company to the Agent, or any
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further or different officer of the Company so named by the President,
Chief Executive Officer, Chief Financial Officer or Senior Vice
President-Finance of the Company in a written notice to the Agent.
"Available Facility B Commitments" means the portion (if any) of the
Facility B Commitments that have been activated in accordance with the
provisions hereof and hence the aggregate principal amount of Facility B Loans
that at any given time may be borrowed hereunder.
"Business Day" means any day other than a Saturday or Sunday on which
banks are not authorized or required to close in Chicago, Illinois and, when
used with respect to LIBOR Portions, a day on which banks are also dealing in
United States Dollar deposits in London, England and Nassau, Bahamas.
"Capital Lease" means any lease of Property which in accordance with
GAAP is required to be capitalized on the balance sheet of the lessee.
"Capitalized Lease Obligation" means the amount of the liability shown
on the balance sheet of any Person in respect of a Capital Lease determined in
accordance with GAAP.
"Code" means the Internal Revenue Code of 1986, as amended, and any
successor statute thereto.
"Commitments" means and includes the Facility A Commitments and the
Facility B Commitments, unless the context in which such term is used shall
otherwise require.
"Company" is defined in the introductory paragraph hereof.
"Compliance Certificate" means a certificate furnished to the Agent
pursuant to Section 8.5 hereof in the form of Exhibit D hereto.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Company or any of its Subsidiaries, are
treated as a single employer under Section 414 of the Code.
"Default" means any event or condition the occurrence of which would,
with the passage of time or the giving of notice, or both, constitute an Event
of Default.
"Defaulting Lender" shall mean a Lender which has failed to fund as and
when required by the terms and conditions of this Agreement such Lender's
ratable share of any Loan hereunder, if any so long as such failure continues
unremedied.
"Domestic Rate" means, for any day, the greater of (i) the rate of
interest announced by the Agent from time to time as its prime commercial rate,
as in effect on such day; and (ii) the sum of (x) the rate determined by the
Agent to be the average (rounded upwards, if
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necessary, to the next higher 1/100 of 1%) of the rates per annum quoted to the
Agent at approximately 10:00 a.m. (Chicago time) (or as soon thereafter as is
practicable) on such day (or, if such day is not a Business Day, on the
immediately preceding Business Day) by two or more Federal funds brokers
selected by the Agent for the sale to the Agent at face value of Federal funds
in an amount equal or comparable to the principal amount owed to the Agent for
which such rate is being determined, plus (y) 3/8 of 1% (0.375%).
"Domestic Rate Portions" is defined in Section 2.1(a) hereof.
"EBITDA" means, with reference to any period, Net Income for such
period plus all amounts deducted in arriving at such Net Income amount in
respect of (i) Interest Expense for such period, plus (ii) federal, state and
local income taxes for such period, plus (iii) all amounts properly charged for
depreciation of fixed assets and amortization of intangible assets during such
period on the books of the Company and its Subsidiaries.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor statute thereto.
"Event of Default" means any event or condition identified as such in
Section 9.1 hereof.
"Existing Credit Agreement" means the Credit Agreement dated as of
August 2, 1995, among the Company, the banks referred to therein and the Agent,
as agent.
"Facility A Credit" is defined in Section 1.1 hereof.
"Facility A Credit Commitments" means the commitments of the Lenders
to extend credit under the Facility A Credit in the amounts set forth opposite
their signatures hereto under the heading "Facility A Commitment" and opposite
their signatures on Assignment Agreements delivered pursuant to Section 11.9
hereof under the heading "Facility A Commitment", as such amounts may be
reduced pursuant hereto.
"Facility A Loan" is defined in Section 1.1 hereof.
"Facility A Note" is defined in Section 1.1 hereof.
"Facility A Termination Date" means May 31, 1999, or any later date to
which the Facility A Commitments are extended pursuant to Section 11.16 hereof,
or such earlier date on which the Facility A Commitments are terminated in
whole pursuant to Section 3.6, 9.2 or 9.3 hereof.
"Facility B Activation Date" is defined in Section 1.2 hereof.
"Facility B Commitments" means the commitments of the Lenders to make
Facility B Loans in the amounts set forth opposite their signature hereto under
the heading "Facility B Commitment" and opposite their signatures on Assignment
Agreements delivered pursuant
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to Section 11.9 hereof under the heading "Facility B Commitment", as
such amounts may be reduced pursuant hereto.
"Facility B Credit" is defined in Section 1.2 hereof.
"Facility B Loans" is defined in Section 1.2 hereof.
"Facility B Notes" is defined in Section 1.2 hereof.
"Facility B Term Credit" is defined in Section 1.2 hereof.
"Facility B Term Loans" is defined in Section 1.2 hereof.
"Facility B Term Notes" is defined in Section 1.2 hereof.
"Facility B Termination Date" means May 31, 2000, or such earlier date
on which the Facility B Commitments are terminated in whole pursuant to Section
3.6, 9.2 or 9.3 hereof.
"Fixed Charges" means, with reference to any period, the sum (without
duplication) of (i) the aggregate amount of payments required to be made by the
Company and its Subsidiaries within the twelve (12) calendar months following
the close of such period in respect of principal on all Indebtedness for
Borrowed Money (whether at maturity, as a result of mandatory sinking fund
redemption, mandatory prepayment, acceleration or otherwise), plus (ii)
Interest Expense for such period, plus (iii) the aggregate amount of capital
expenditures (as determined and classified in accordance with GAAP) made by the
Company and its Subsidiaries during such period.
"GAAP" means generally accepted accounting principles as in effect from
time to time, applied by the Company and its Subsidiaries on a basis consistent
with the preparation of the Company's most recent financial statements
furnished to the Lenders pursuant to Section 6.5 hereof.
"Indebtedness for Borrowed Money" means for any Person (without
duplication) (i) all indebtedness created, assumed or incurred in any manner by
such Person representing money borrowed (including by the issuance of debt
securities), (ii) all indebtedness for the deferred purchase price of property
or services (other than trade accounts payable arising in the ordinary course
of business which are not more than sixty (60) days past due), (iii) all
indebtedness secured by any Lien upon Property of such Person, whether or not
such Person has assumed or become liable for the payment of such indebtedness,
(iv) all Capitalized Lease Obligations of such Person and (v) all obligations
of such Person on or with respect to letters of credit, bankers' acceptances
and other extensions of credit whether or not representing obligations for
borrowed money.
"Interest Expense" means, with reference to any period, the sum of all
interest charges (including imputed interest charges with respect to
Capitalized Lease Obligations and all
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amortization of debt discount and expense) of the Company
and its Subsidiaries for such period determined in accordance with GAAP.
"Interest Period" means, with respect to any LIBOR Portion, the period
commencing on, as the case may be, the creation, continuation or conversion
date with respect to such LIBOR Portion and ending one (1), two (2), three (3)
or six (6) months thereafter as selected by the Company in its notice as
provided herein; provided that all of the foregoing provisions relating to
Interest Periods are subject to the following:
(i) if any Interest Period would otherwise end on a day
which is not a Business Day, that Interest Period shall be extended to
the next succeeding Business Day, unless in the case of an Interest
Period for a LIBOR Portion the result of such extension would be to
carry such Interest Period into another calendar month in which event
such Interest Period shall end on the immediately preceding Business
Day;
(ii) no Interest Period may extend beyond the final maturity
date of the relevant Notes;
(iii) the interest rate to be applicable to each Portion for
each Interest Period shall apply from and including the first day of
such Interest Period to but excluding the last day thereof; and
(iv) no Interest Period may be selected if after giving effect
thereto the Company will be unable to make a principal payment
scheduled to be made during such Interest Period without paying part of
a LIBOR Portion on a date other than the last day of the Interest
Period applicable thereto.
For purposes of determining an Interest Period, a month means a period starting
on one day in a calendar month and ending on a numerically corresponding day in
the next calendar month, provided, however, if an Interest Period begins on the
last day of a month or if there is no numerically corresponding day in the
month in which an Interest Period is to end, then such Interest Period shall
end on the last Business Day of such month.
"Lender" means ▇▇▇▇▇▇ Trust and Savings Bank, the other signatories
hereto (other than the Company) and all other lenders becoming parties hereto
pursuant to Section 11.9 hereof.
"Level I Status" means, for any Margin Determination Date, that as of
the close of the accounting period with reference to which such Margin
Determination Date was set, the Leverage Ratio is more than 1.25 to 1.
"Level II Status" means, for any Margin Determination Date, that as of
the close of the accounting period with reference to which such Margin
Determination Date was set, (i) the Company has not attained Level III Status
and (ii) the Leverage Ratio is not more than 1.0 to 1.
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"Level III Status" means, for any Margin Determination Date, that as of
the close of the accounting period with reference to which such Margin
Determination Date was set, the Leverage Ratio is not more than 0.50 to 1.
"Leverage Ratio" means as of any time the same is to be determined, the
ratio of Total Liabilities to Tangible Net Worth.
"LIBOR Portions" is defined in Section 2.1(a) hereof.
"Lien" means any mortgage, lien, security interest, pledge, charge or
encumbrance of any kind in respect of any Property, including the interests of
a vendor or lessor under any conditional sale, Capital Lease or other title
retention arrangement.
"Loan Documents" means this Agreement and the Notes.
"Loans" means and includes Facility A Loans, the Facility B Loans and
the Facility B Term Loans, unless the context in which such term is used shall
otherwise require.
"Material Subsidiary" shall mean each Subsidiary other than a
Non-Material Subsidiary.
"Net Income" means, with reference to any period, the net income (or
net loss) of the Company and its Subsidiaries for such period as computed on a
consolidated basis in accordance with GAAP, and, without limiting the
foregoing, after deduction from gross income of all expenses and reserves,
including reserves for all taxes on or measured by income, but excluding any
extraordinary profits or losses and also excluding any taxes on such profits
and any tax credits upon such losses.
"Non-Material Subsidiary" shall mean any Subsidiary (i) the revenues of
which (directly and together with its subsidiaries) for the most recently
completed fiscal year of the Company were less than 2% of the Company's
consolidated revenues for such fiscal year and (ii) the consolidated total
assets of which (directly and together with its subsidiaries) as of the date of
such financial statements were less than 2% of the Company's consolidated total
assets as of such date; provided, however, that each Subsidiary which would
(but for this proviso) constitute a Non-Material Subsidiary with the greatest
revenues shall constitute a Material Subsidiary if (i) the revenues of such
Subsidiary (directly and together with its subsidiaries), when together with
the revenues of Non-Material Subsidiaries (directly and together with their
respective subsidiaries), in each case for the most recently completed fiscal
year of the Company equal or exceed 5% of the Company's consolidated revenues
for such fiscal year or (ii) the consolidated total assets of such Subsidiary
(directly and together with its subsidiaries), when taken together with the
consolidated total assets of the Non-Material Subsidiaries (directly and
together with their respective subsidiaries), in each case as the date of such
financial statements equal or exceed 5% of the Company's consolidated total
assets as of such date.
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"Notes" means and includes the Facility A Notes, the Facility B Notes
and the Facility B Term Notes, unless the context in which such term is used
shall otherwise require.
"Obligations" means all obligations of the Company to pay principal and
interest on the Loans, all fees and charges payable hereunder, and all other
payment obligations of the Company arising under or in relation to any Loan
Document, in each case whether now existing or hereafter arising, due or to
become due, direct or indirect, absolute or contingent, and howsoever
evidenced, held or acquired.
"PBGC" means the Pension Benefit Guaranty Corporation or any Person
succeeding to any or all of its functions under ERISA.
"Person" means an individual, partnership, corporation, association,
trust, unincorporated organization or any other entity or organization,
including a government or agency or political subdivision thereof.
"Plan" means any employee pension benefit plan covered by Title IV of
ERISA or subject to the minimum funding standards under Section 412 of the Code
that either (i) is maintained by a member of the Controlled Group for employees
of a member of the Controlled Group, or (ii) is maintained pursuant to a
collective bargaining agreement or any other arrangement under which more than
one employer makes contributions and to which a member of the Controlled Group
is then making or accruing an obligation to make contributions or has within
the preceding five plan years made contributions.
"Portion" is defined in Section 2.1(a) hereof.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Required Lenders" means, as of the date of determination thereof,
those Lenders holding at least 66-2/3% of the Commitments or, in the event that
no Commitments are outstanding hereunder, holding at least 66-2/3% in aggregate
principal amount of the Loans; provided, however, if at such time (i) any
Lender shall be a Defaulting Lender and (ii) no Default or Event of Default
shall have occurred and be continuing, there shall be excluded from the
determination of Required Lenders (i) the Commitments of such Lender at such
time and (ii) if no Commitments are outstanding at such time, the aggregate
amount of the Loans owing to such Lender (in its capacity as a Lender) and
outstanding at such time.
"SEC" shall mean the Securities and Exchange Commission of the United
States.
"Subsidiary" means any corporation or other Person more than 50% of the
outstanding ordinary voting shares or other equity interests of which is at the
time directly or indirectly owned by the Company, by one or more of its
Subsidiaries, or by the Company and one or more of its Subsidiaries.
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"Tangible Net Worth" means, as of any time the same is to be
determined, the total shareholders' equity (including capital stock, additional
paid-in-capital and retained earnings after deducting treasury stock, but
excluding minority interests in Subsidiaries) which would appear on the balance
sheet of the Company and its Subsidiaries determined on a consolidated basis in
accordance with GAAP, less the sum of (i) all notes receivable from officers
and employees of the Company and its Subsidiaries, (ii) the aggregate book
value of all assets which would be classified as intangible assets under GAAP,
including, without limitation, goodwill, patents, trademarks, trade names,
copyrights, franchises and deferred charges (including, without limitation,
unamortized debt discount and expense, organization costs and deferred research
and development expense) and similar assets and (iii) the write-up of assets
above cost.
"Total Capitalization" means, as of any time the same is to be
determined, the sum of Tangible Net Worth plus Indebtedness for Borrowed Money
of the Company and its Subsidiaries in accordance with GAAP.
"Total Liabilities" means, as of any time the same is to be determined,
the aggregate of all indebtedness, obligations, liabilities, reserves and any
other items which would be listed as a liability on a balance sheet of the
Company and its Subsidiaries determined on a consolidated basis in accordance
with GAAP, and in any event including all indebtedness and liabilities of any
other Person which the Company or any Subsidiary may guarantee or otherwise be
responsible or liable for (other than any liability arising out of the
endorsement of commercial paper for deposit or collection received in the
ordinary course of business or other contingent liabilities not required to be
included under GAAP as liabilities on a balance sheet), all indebtedness and
liabilities secured by any Lien on any Property of the Company or any
Subsidiary, whether or not the same would be classified as a liability on a
balance sheet, the liability of the Company or any Subsidiary in respect of
banker's acceptances and letters of credit, and the aggregate amount of rentals
or other consideration payable by the Company or any Subsidiary in accordance
with GAAP over the remaining unexpired term of all Capital Leases, but
excluding all general contingency reserves and reserves for deferred income
taxes and investment credit.
"Unfunded Vested Liabilities" means, for any Plan at any time, the
amount (if any) by which the present value of all vested nonforfeitable accrued
benefits under such Plan exceeds the fair market value of all Plan assets
allocable to such benefits, all determined as of the then most recent valuation
date for such Plan, but only to the extent that such excess represents a
potential liability of a member of the Controlled Group to the PBGC or the Plan
under Title IV of ERISA.
"Voting Stock" of any Person means capital stock of any class or
classes (however designated) having ordinary voting power for the election of
directors or such Person, other than stock having such power only by reason of
the happening of a contingency.
"Welfare Plan" means a "welfare plan" as defined in Section 3(1) of
ERISA.
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"Wholly-Owned Subsidiary" means a Subsidiary of which all of the issued
and outstanding shares of capital stock (other than directors' qualifying
shares as required by law) or other equity interests are owned by the Company
and/or one or more Wholly-Owned Subsidiaries within the meaning of this
definition.
Section 5.2. Interpretation. The foregoing definitions are equally
applicable to both the singular and plural forms of the terms defined. The
words "hereof", "herein", and "hereunder" and words of like import when used in
this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement. All references to time of day herein
are references to Chicago, Illinois time unless otherwise specifically
provided. Where the character or amount of any asset or liability or item of
income or expense is required to be determined or any consolidation or other
accounting computation is required to be made for the purposes of this
Agreement, it shall be done in accordance with GAAP except where such
principles are inconsistent with the specific provisions of this Agreement.
SECTION 6. REPRESENTATIONS AND WARRANTIES.
The Company represents and warrants to the Agent and the Lenders as
follows:
Section 6.1. Organization and Qualification. The Company is duly
organized, validly existing and in good standing as a corporation under the
laws of the State of Illinois, has full and adequate corporate power to own its
Property and conduct its business as now conducted, and is duly licensed or
qualified and in good standing in each jurisdiction where the failure to be so
licensed or qualified would have a material adverse effect on the financial
condition, Properties, business or operations of the Company and its
Subsidiaries, taken as a whole.
Section 6.2. Subsidiaries. Each Subsidiary is duly organized, validly
existing and in good standing under the laws of the jurisdiction in which it is
incorporated or organized, as the case may be, has full and adequate power to
own its Property and conduct its business as now conducted, and is duly
licensed or qualified and in good standing in each jurisdiction where the
failure to be so licensed or qualified would have a material adverse effect on
the financial condition, Properties, business or operations of the Company and
its Subsidiaries, taken as a whole. Schedule 6.2 hereto identifies each
Subsidiary, the jurisdiction of its incorporation or organization, as the case
may be, the percentage of issued and outstanding shares of each class of its
capital stock or other equity interests owned by the Company and the
Subsidiaries and, if such percentage is not 100% (excluding directors'
qualifying shares as required by law), a description of each class of its
authorized capital stock and other equity interests and the number of shares of
each class issued and outstanding. All of the outstanding shares of capital
stock and other equity interests of each Subsidiary are validly issued and
outstanding and fully paid and nonassessable and all such shares and other
equity interests indicated on Schedule 6.2 as owned by the Company or a
Subsidiary are owned, beneficially and of record, by the Company or such
Subsidiary free and clear of all Liens. There are no outstanding commitments
or other obligations of any Subsidiary to issue, and
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no options, warrants or other rights of any Person to acquire, any
shares of any class of capital stock or other equity interests of any
Subsidiary.
Section 6.3. Corporate Authority and Validity of Obligations. The
Company has full right and authority to enter into this Agreement and the other
Loan Documents, to make the borrowings herein provided for, to issue its Notes
in evidence thereof and to perform all of its obligations hereunder and under
the other Loan Documents. The Loan Documents delivered by the Company have
been duly authorized, executed and delivered by the Company and constitute
valid and binding obligations of the Company enforceable in accordance with
their terms except as enforceability may be limited by bankruptcy, insolvency,
fraudulent conveyance or similar laws affecting creditors' rights generally and
general principles of equity (regardless of whether the application of such
principles is considered in a proceeding in equity or at law) and this
Agreement and the other Loan Documents do not, nor does the performance or
observance by the Company of any of the matters and things herein or therein
provided for, contravene or constitute a default under any provision of law or
any judgment, injunction, order or decree binding upon the Company or any
provision of the charter, articles of incorporation or by-laws of the Company
or any covenant, indenture or agreement of or affecting the Company or any of
its Properties, or result in the creation or imposition of any Lien on any
Property of the Company.
Section 6.4. Use of Proceeds Margin Stock. The Company shall use
the proceeds of the Loans and other extensions of credit made available
hereunder solely for its general working capital purposes and for such other
legal and proper purposes as are consistent with all applicable laws, the
Company's charter, articles of incorporation and by-laws, resolutions of the
Company's board of directors, and the terms of this Agreement. Neither the
Company nor any Subsidiary is engaged in the business of extending credit for
the purpose of purchasing or carrying margin stock (within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System), and no
part of the proceeds of any Loan or any other extension of credit made
hereunder will be used to purchase or carry any such margin stock or to extend
credit to others for the purpose of purchasing or carrying any such margin
stock.
Section 6.5. Financial Reports. The consolidated balance sheet of the
Company and its Subsidiaries as at December 31, 1995 and the related
consolidated statements of income, retained earnings and cash flows of the
Company and its Subsidiaries for the fiscal year then ended, and accompanying
notes thereto, which financial statements are accompanied by the audit report
of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, independent public accountants, and the unaudited
interim consolidated balance sheet of the Company and its Subsidiaries as at
March 31, 1996 and the related consolidated statements of income, retained
earnings and cash flows of the Company and its Subsidiaries for the thirteen
(13) weeks then ended, heretofore furnished to the Lenders, fairly present the
consolidated financial condition of the Company and its Subsidiaries as at said
dates and the consolidated results of their operations and cash flows for the
periods then ended in conformity with generally accepted accounting principles
applied on a consistent basis. Neither the Company nor any Subsidiary has
contingent liabilities which are material to it other than as indicated on such
financial statements or,
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with respect to future periods, on the financial statements furnished
pursuant to Section 8.5 hereof.
Section 6.6. No Material Adverse Change. Since March 31, 1996, there
has been no change in the condition (financial or otherwise) or business
prospects of the Company or any Subsidiary except those occurring in the
ordinary course of business, none of which individually or in the aggregate
have been materially adverse.
Section 6.7. Full Disclosure. The statements and information
furnished to the Lenders in connection with the negotiation of this Agreement
and the other Loan Documents and the commitments by the Lenders to provide all
or part of the financing contemplated hereby do not contain any untrue
statements of a material fact or omit a material fact necessary to make the
material statements contained herein or therein not misleading, the Lenders
acknowledging that as to any projections furnished to Lenders, the Company only
represents that the same were prepared on the basis of information and
estimates the Company believed to be reasonable.
Section 6.8. Good Title. The Company and its Subsidiaries each have
good and defensible title to their assets as reflected on the most recent
consolidated balance sheet of the Company and its Subsidiaries furnished to
the Lenders (except for sales of assets by the Company and its Subsidiaries in
the ordinary course of business), subject to no Liens other than such thereof
as are permitted by Section 8.11 hereof.
Section 6.9. Litigation and Other Controversies. There is no
litigation or governmental proceeding or labor controversy pending, nor to the
knowledge of the Company threatened, against the Company or any Subsidiary
which if adversely determined would (a) impair the validity or enforceability
of, or impair the ability of the Company to perform its obligations under, this
Agreement or any other Loan Document or (b) result in any material adverse
change in the financial condition, Properties, business or operations of the
Company or any Subsidiary.
Section 6.10. Taxes. All United States federal income and all other
material tax returns required to be filed by the Company or any Subsidiary
(except those returns other than United States federal income tax returns, the
failure to file of which could not reasonably be expected to have a material
adverse effect on the financial condition, Properties, business or operations
of the Company and its Subsidiaries, taken as a whole) in any jurisdiction
have, in fact, been filed, and all taxes, assessments, fees and other
governmental charges upon the Company or any Subsidiary or upon any of their
respective Properties, income or franchises, which are shown to be due and
payable in such returns, have been paid. The Company does not know of any
proposed additional tax assessment against it or its Subsidiaries for which
adequate provision in accordance with GAAP has not been made on its accounts.
Adequate provisions in accordance with GAAP for taxes on the books of the
Company and each Subsidiary have been made for all open years, and for its
current fiscal period.
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Section 6.11. Approvals. To the best knowledge of the Company, no
authorization, consent, license, or exemption from, or filing or registration
with, any court or governmental department, agency or instrumentality, nor any
approval or consent of the stockholders of the Company or any other Person, is
or will be necessary to the valid execution, delivery or performance by the
Company of this Agreement or any other Loan Document.
Section 6.12. Affiliate Transactions. Neither the Company nor any
Subsidiary is a party to any material contracts or agreements with any of its
Affiliates (other than with Wholly-Owned Subsidiaries) on terms and conditions
which are less favorable to the Company or such Subsidiary than would be usual
and customary in similar contracts or agreements between Persons not affiliated
with each other.
Section 6.13. Investment Company Public Utility Holding Company.
Neither the Company nor any Subsidiary is an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended, or a "public utility holding company" within
the meaning of the Public Utility Holding Company Act of 1935, as amended.
Section 6.14. ERISA. The Company and each other member of its
Controlled Group has fulfilled its obligations under the minimum funding
standards of and is in compliance in all material respects with ERISA and the
Code to the extent applicable to it and has not incurred any liability to the
PBGC or a Plan under Title IV of ERISA other than a liability to the PBGC for
premiums under Section 4007 of ERISA. Neither the Company nor any Subsidiary
has any contingent liabilities with respect to any post-retirement benefits
under a Welfare Plan, other than liability for continuation coverage described
in article 6 of Title I of ERISA.
Section 6.15. Compliance with Laws. To the best knowledge of the
Company, the Company and each of its Subsidiaries are in compliance in all
material respects with the requirements of all federal, state and local laws,
rules and regulations applicable to or pertaining to their Properties or
business operations (including, without limitation, the Occupational Safety and
Health Act of 1970, the Americans with Disabilities Act of 1990, and laws and
regulations establishing quality criteria and standards for air, water, land
and toxic or hazardous wastes and substances), non-compliance with which could
have a material adverse effect on the financial condition, Properties, business
or operations of the Company or any Subsidiary, taken as a whole. Neither the
Company nor any Subsidiary has received notice to the effect that its
operations are not in compliance with any of the requirements of applicable
federal, state or local environmental, health and safety statutes and
regulations or are the subject of any governmental investigation evaluating
whether any remedial action is needed to respond to a release of any toxic or
hazardous waste or substance into the environment, which non-compliance or
remedial action could have a material adverse effect on the financial
condition, Properties, business or operations of the Company and its
Subsidiaries, taken as a whole.
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Section 6.16. Other Agreements. Neither the Company nor any
Subsidiary is in default under the terms of any covenant, indenture or
agreement of or affecting the Company, any Subsidiary or any of their
Properties, which default if uncured would have a material adverse effect on
the financial condition, Properties, business or operations of the Company and
its Subsidiaries, taken as a whole.
Section ▇.▇▇.▇▇ Default. No Default or Event of Default has occurred
and is continuing.
SECTION 7. CONDITIONS PRECEDENT.
The obligation of the Lenders to make any Loan under this Agreement is
subject to the following conditions precedent:
Section 7.1. All Advances. As of the time of the making of each
extension of credit (including the initial extension of credit) hereunder:
(a) each of the representations and warranties set forth in
Section 6 hereof and in the other Loan Documents shall be true and
correct as of such time, except to the extent the same expressly relate
to an earlier date
(b) the Company shall be in full compliance with all of the
terms and conditions of this Agreement and of the other Loan Documents,
and no Default or Event of Default shall have occurred and be
continuing or would occur as a result of making such extension of
credit
(c) after giving effect to such extension of credit the
aggregate principal amount of all Facility A Loans outstanding under
this Agreement shall not exceed the Facility A Commitments
(d) after giving effect to such extension of credit the
aggregate principal amount of all Facility B Loans outstanding under
this Agreement shall not exceed the Available Facility B Commitments
and
(e) such extension of credit shall not violate any order,
judgment or decree of any court or other authority or any provision of
law or regulation applicable to the Agent or any Lender (including,
without limitation, Regulation U of the Board of Governors of the
Federal Reserve System) as then in effect.
The Company's request for any Loan shall constitute its warranty as to the
facts specified in subsections (a) through (e), both inclusive, above.
Section 7.2. Initial Advance. At or prior to the making of the
initial extension of credit hereunder, the following conditions precedent shall
also have been satisfied:
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(a) the Agent shall have received the following for the account
of the Lenders (each to be properly executed and completed) and the
same shall have been approved as to form and substance by the Agent:
(i) the Facility A Notes and (if the Facility B Credit
has been activated) the Facility B Notes;
(ii) certified copies of resolutions of the Board of
Directors of the Company authorizing the execution and delivery
of this Agreement and the Notes, indicating the authorized
signers of such documents and all other documents relating
thereto and the specimen signatures of such signers;
(iii) copies of the articles of incorporation and
by-laws of the Company certified by the Secretary or other
appropriate officer of the Company; and
(iv) an incumbency certificate containing the name,
title and genuine signatures of each of the Company's
Authorized Representatives;
(b) the Agent shall have received for itself and for the
Lenders the initial fees called for hereby;
(c) legal matters incident to the execution and delivery of
this Agreement and the other Loan Documents and to the transactions
contemplated hereby shall be reasonably satisfactory to each Lender and
its counsel; and the Agent shall have received for the account of the
Lenders the favorable written opinion of counsel for the Company in
form set forth as Exhibit 7.2(c) hereof;
(d) the Agent shall have received for the account of the
Lenders a good standing certificate for the Company (dated as of the
date no earlier than thirty (30) days prior to the date hereof) from
the office of the secretaries of state of the states of Illinois and
Iowa;
(e) The proceeds of such initial credit shall be used to pay in
full all outstanding "Obligations" under the Existing Credit Agreement
except to the extent such "Obligations" constitute a "LIBOR Portions,"
in which event such "Obligations" shall be deemed Facility A Loans made
by the same Lender hereunder evidenced by the relevant Facility A Notes
issued to such Lender, with interest on each such "LIBOR Portion" to be
due and payable at the end of the "Interest Period" applicable thereto
at the time such "LIBOR Portion" becomes evidenced by the Facility A
Notes and the interest applicable to each such "LIBOR Portion" to
continue at the rate which would otherwise applicable thereto under the
Existing Credit Agreement (except that the "Applicable Margin" under
the Existing Credit Agreement shall be deemed the Applicable Margin
hereunder). The Lenders and the Company agree that concurrently with
such initial credit, the Existing Credit Agreement shall terminate and
all "Obligations" outstanding thereunder (except for such "LIBOR
Portions") shall be due and payable; and
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(f) The Agent shall have received a certificate by the
President, Chief Executive Officer, Chief Financial Officer or Senior
Vice President-Finance of the Company, stating that on the date of such
initial extension of credit no Default or Event of Default has occurred
and is continuing.
SECTION 8. COVENANTS.
The Company agrees that, so long as any credit is available to or in
use by the Company hereunder, except to the extent compliance in any case or
cases is waived in writing by the Required Lenders:
Section 8.1. Maintenance of Business. The Company shall, and shall
cause each Subsidiary to, preserve and maintain its existence provided,
however, that nothing in this Section shall prevent the Company from
discontinuing the corporate existence of any Non-Material Subsidiary if
continuance of such Non-Material Subsidiary is desirable in the conduct of the
Company's business or the business of any Subsidiary and such discontinuance
not disadvantageous in any material respect to the Lenders. The Company shall,
and shall cause each Subsidiary to, preserve and keep in force and effect all
licenses, permits and franchises necessary to the proper conduct of its
business provided, however, that the Company shall not be required to preserve
any such right or franchise if the preservation thereof is no longer desirable
in the conduct of the business of the Company or any Subsidiary and the loss
thereof is not disadvantageous in any material respect to the Lenders.
Section 8.2. Maintenance of Properties. The Company shall maintain,
preserve and keep its property, plant and equipment in good repair, working
order and condition (ordinary wear and tear excepted) and shall from time to
time in Company's reasonable business judgment make all needful and proper
repairs, renewals, replacements, additions and betterments thereto so that at
all times the efficiency thereof shall be fully preserved and maintained, and
shall cause each Subsidiary to do so in respect of Property owned or used by
it.
Section 8.3. Taxes and Assessments. The Company shall duly pay and
discharge, and shall cause each Subsidiary to duly pay and discharge, all
taxes, rates, assessments, fees and governmental charges upon or against it or
its Properties, in each case before the same become delinquent and before
penalties accrue thereon, unless and to the extent that the same are being
contested in good faith and by appropriate proceedings which prevent
enforcement of the matter under contest and adequate reserves are provided
therefor.
Section 8.4. Insurance. The Company shall insure and keep insured,
and shall cause each Subsidiary to insure and keep insured, with good and
responsible insurance companies, all insurable Property owned by it which is of
a character usually insured by Persons similarly situated and operating like
Properties against loss or damage from such hazards and risks, and in such
amounts, as are insured by Persons similarly situated and operating like
Properties and the Company shall insure, and shall cause each Subsidiary to
insure, such other hazards and risks (including employers' and public liability
risks) with good and responsible insurance companies as and to the extent
usually insured by Persons similarly
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situated and conducting similar businesses. The Company shall upon
request furnish to the Agent and any Lender a certificate setting forth in
summary form the nature and extent of the insurance maintained pursuant to this
Section.
Section 8.5. Financial Reports. The Company shall, and shall cause
each Subsidiary to, maintain a standard system of accounting in accordance with
GAAP and shall furnish to the Agent, each Lender and each of their duly
authorized representatives such information respecting the business and
financial condition of the Company and its Subsidiaries as the Agent or such
Lender may reasonably request; and without any request, shall furnish to the
Lenders:
(a) as soon as available, and in any event within forty-five (45)
days after the close of each quarterly accounting period of the
Company, a copy of the consolidated and consolidating balance sheet of the
Company and its Subsidiaries as of the last day of such period and the
consolidated and consolidating statements of income, retained earnings and
cash flows of the Company and its Subsidiaries for such quarter and for
the fiscal year-to-date period then ended, each in reasonable detail
showing in comparative form the figures for the corresponding date and
period in the previous fiscal year, prepared by the Company in accordance
with GAAP and certified to by the President, Chief Executive Officer,
Chief Financial Officer or Senior Vice President-Finance of the Company;
(b) within forty-five (45) days after the end of each of the first
three quarterly fiscal periods of the Company, a copy of the Company's
Form 10-Q Report filed with the SEC;
(c) within ninety (90) days after the end of each fiscal year of
the Company, a copy of the Company's Form 10-K Report filed with the SEC,
including a copy of the audited financial statements of the Company and
the Subsidiaries for such year with the accompanying report of independent
public accountants;
(d) as soon as available, and in any event within
ninety (90) days after the close of each annual accounting period of the
Company, to the extent not contained in the Company's Form 10-K Report
filed with the SEC for such year, a copy of the consolidated balance sheet
of the Company and its Subsidiaries as of the last day of the period then
ended and the consolidated statements of income, retained earnings and
cash flows of the Company and its Subsidiaries for the period then ended,
and accompanying notes thereto, each in reasonable detail showing in
comparative form the figures for the previous fiscal year, accompanied by
the opinion thereon of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & Company or another firm of
independent public accountants of recognized national standing, selected
by the Company and satisfactory to the Required Lenders, to the effect
that such consolidated financial statements have been prepared in
conformity with GAAP and present fairly the consolidated financial
condition of the Company and its Subsidiaries as of the close of such
fiscal year and the results of their operations and cash flows for the
fiscal year then ended and that the audit of such financial statements was
made in accordance with generally accepted
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auditing standards and, accordingly, such audit provided a
reasonable basis for their opinion;
(e) within the period provided in subsection (d) above,
the written statement of the accountants who certified the
audit report thereby required that in connection with their audit,
nothing comes to their attention that causes them to believe that the
Company was not in compliance with the terms, covenants, conditions or
provisions of this Agreement insofar as they relate to accounting
matters;
(f) promptly after receipt thereof, any additional management
letters or other information similar in scope given to it by
its independent public accountants;
(g) as soon as available, and in any event within ninety (90)
days after the end of each fiscal year of the Company, a copy
of the Company's consolidated and consolidating business plan for the
following fiscal year, such business plan to show the Company's
projected consolidated and consolidating revenues, expenses, and
balance sheet on an annual basis, such business plan to be in
reasonable detail prepared by the Company and in form reasonably
satisfactory to the Required Lenders;
(h) promptly after the sending or filing thereof, copies of all
proxy statements, financial statements and reports which the
Company sends to its shareholders, and copies of all other regular,
periodic and special reports and all registration statements which the
Company files with the SEC or any successor thereto, or with any
national securities exchange; and
(i) promptly after knowledge thereof shall have come to the
attention of any responsible officer of the Company, written
notice of any threatened or pending material litigation or
governmental proceeding or labor controversy against the Company or
any Subsidiary which, if adversely determined, would adversely effect
the financial condition, Properties, business or operations of the
Company and its Subsidiaries, taken as a whole, or of the occurrence
of any Default or Event of Default hereunder.
Each of the financial statements furnished to the Lenders pursuant to
subsection (c) of this Section 8.5, and each of the financial statements
furnished to the Lenders for any fiscal quarter of the Company pursuant to
subsection (b) of this Section 8.5, shall be accompanied by a written
certificate in the form attached hereto as Exhibit D signed by the President,
Chief Executive Officer, Chief Financial Officer or Senior Vice
President-Finance of the Company to the effect that to the best of such
officer's knowledge and belief no Default or Event of Default has occurred
during the period covered by such statements or, if any such Default or Event
of Default has occurred during such period, setting forth a description of such
Default or Event of Default and specifying the action, if any, taken by the
Company to remedy the same. Such certificate shall also set forth the
calculations supporting such statements in respect of Sections 8.7, 8.8 and 8.9
of this Agreement.
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Section 8.6. Inspection. The Company shall, and shall cause each
Subsidiary to, permit the Agent, each Lender and each of their duly authorized
representatives and agents to visit and inspect any of the Properties,
corporate books and financial records of the Company and each Subsidiary, to
examine and make copies of the books of accounts and other financial records of
the Company and each Subsidiary, and to discuss the affairs, finances and
accounts of the Company and each Subsidiary with, and to be advised as to the
same by, its officers, employees and independent public accountants (and by
this provision the Company hereby authorizes such accountants to discuss with
the Agent and such Lenders the finances and affairs of the Company and of each
Subsidiary) at such reasonable times and reasonable intervals as the Agent or
any such Lender may designate.
Section 8.7. Modified Leverage Ratio. The Company will at all times
maintain a ratio of Indebtedness for Borrowed Money to Total Capitalization, in
each case on a consolidated basis for the Company and its Subsidiaries, of not
more than 0.40 to 1.
Section 8.8. Debt Service Coverage Ratio. The Company will, as of
the close of each fiscal quarter of the Company, maintain the ratio of
Indebtedness for Borrowed Money of the Company and its Subsidiaries as of such
close to EBITDA for the four fiscal quarters then ended at not more than 1.00
to 1.
Section 8.9. Fixed Charge Coverage Ratio. Beginning with the quarter
ending on September 30, 1996, the Company will, as of the close of each fiscal
quarter of the Company, maintain the ratio (the "Fixed Charge Coverage Ratio")
of EBITDA for the four fiscal quarters then ended to Fixed Charges for the same
four fiscal quarters then ended (provided that the Fixed Charge Coverage Ratio
shall be computed as of September 30, 1996 for the period of three quarters
then ended) of not less than 1.25 to 1.
Section 8.10. Indebtedness for Borrowed Money. The Company shall
not, nor shall it permit any Subsidiary to, issue, incur, assume, create or
have outstanding any Indebtedness for Borrowed Money provided, however, that
the foregoing shall not restrict nor operate to prevent:
(a) the Obligations of the Company owing to the Agent and the
Lenders hereunder
(b) purchase money indebtedness and Capitalized Lease Obligations
secured by Liens permitted by Section 8.11 hereof in an aggregate amount
not to exceed $10,000,000 at any one time outstanding
(c) obligations of the Company aggregating not more than $1,528,000
in respect of (i) the City of Cedar Rapids, Iowa Industrial Development
Revenue Bonds (E & S Electrical Contractors, Inc. Project), Series 1981
and (ii) the City of Cedar Rapids, Iowa Industrial Development Revenue
Bonds (TLS Co. Project), Series 1981
(d) indebtedness of Subsidiaries acquired in compliance with Section
8.12(h) hereof, and indebtedness assumed by the Company or any Subsidiary
of a Person
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whose assets were acquired in compliance with such Section 8.12(h), in
each case existing at the time of such acquisition and not created in
contemplation of such acquisition and aggregating not more than $1,000,000
at any one time outstanding; and
(e) intercompany loans and advances permitted by Section 8.12
hereof; and
(f) other indebtedness not otherwise permitted by this Section
aggregating not more than $100,000 at any one time outstanding.
Section 8.11. Liens. The Company shall not, nor shall it permit any
Subsidiary to, create, incur or permit to exist any Lien of any kind on any
Property owned by the Company or any Subsidiary; provided, however, that the
foregoing shall not apply to nor operate to prevent:
(a) Liens arising by statute in connection with worker's
compensation, unemployment insurance, old age benefits, social security
obligations, taxes, assessments, statutory obligations or other similar
charges, good faith cash deposits in connection with tenders, contracts or
leases to which the Company or any Subsidiary is a party or other cash
deposits required to be made in the ordinary course of business, provided
in each case that the obligation is not for borrowed money and that the
obligation secured is not overdue or, if overdue, is being contested in
good faith by appropriate proceedings which prevent enforcement of the
matter under contest and adequate reserves have been established therefor;
(b) mechanics', workmen's, materialmen's, landlords', carriers', or
other similar Liens arising in the ordinary course of business with
respect to obligations which are not due or which are being contested in
good faith by appropriate proceedings which prevent enforcement of the
matter under contest;
(c) the pledge of assets for the purpose of securing an appeal,
stay or discharge in the course of any legal proceeding, provided that
the aggregate amount of liabilities of the Company and its Subsidiaries
secured by a pledge of assets permitted under this subsection, including
interest and penalties thereon, if any, shall not be in excess of $100,000
at any one time outstanding;
(d) Liens on property of the Company or any of its Subsidiaries
created solely for the purpose of securing indebtedness permitted by
Section 8.10(b) hereof, representing or incurred to finance, refinance or
refund the purchase price of Property, provided that no such Lien shall
extend to or cover other Property of the Company or such Subsidiary other
than the respective Property so acquired, and the principal amount of
indebtedness secured by any such Lien shall at no time exceed the original
purchase price of such Property;
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(e) Liens on the Company's buildings and related fixtures at the
so-called Cedar Rapids Ground Transportation Center in Cedar Rapids, Iowa
securing the indebtedness permitted by Sections 8.10(c) hereof; and
(f) Liens set forth on Schedule 8.11 hereof.
Section 8.12. Investments, Acquisitions, Loans, Advances and
Guaranties. The Company shall not, nor shall it permit any Subsidiary
to, directly or indirectly, make, retain or have outstanding any investments
(whether through purchase of stock or obligations or otherwise) in, or loans or
advances (other than for travel advances and other similar cash advances made
to employees in the ordinary course of business) to, any other Person, or
acquire all or any substantial part of the assets or business of any other
Person or division thereof, or be or become liable as endorser, guarantor,
surety or otherwise for any debt, obligation or undertaking of any other
Person, or otherwise agree to provide funds for payment of the obligations of
another, or supply funds thereto or invest therein or otherwise assure a
creditor of another against loss, or apply for or become liable to the issuer
of a letter of credit which supports an obligation of another, or subordinate
any claim or demand it may have to the claim or demand of any other Person;
provided, however, that the foregoing shall not apply to nor operate to
prevent:
(a) investments in direct obligations of the United States of
America or of any agency or instrumentality thereof whose obligations
constitute full faith and credit obligations of the United States of
America, provided that any such obligations shall mature within one year
of the date of issuance thereof;
(b) investments in commercial paper rated at least P-1 by ▇▇▇▇▇'▇
Investors Services, Inc. and at least A-1 by Standard & Poor's
Corporation maturing within 270 days of the date of issuance thereof;
(c) investments in certificates of deposit issued by any United
States commercial bank having capital and surplus of not less than
$100,000,000 which have a maturity of one year or less;
(d) endorsement of items for deposit or collection of commercial
paper received in the ordinary course of business;
(e) loans by the Company to, or other investments by the Company in,
any one or more Subsidiaries in the ordinary course of the Company's
business aggregating not more than $2,000,000 at any one time outstanding;
(f) loans by any one or more Subsidiaries to the Company in the
ordinary course of such Subsidiaries' business aggregating not more than
$500,000 at any one time outstanding;
(g) loans by any one or more Subsidiaries to, or other investments
by any one or more Subsidiaries in, any one or more other Subsidiaries in
the ordinary
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course of such lending or investing Subsidiaries' business aggregating
not more than $500,000 at any one time outstanding;
(h) acquisitions of all or substantially all of the assets or
business of any other Person engaged in the same or similar business as
the Company or division of such a Person, or of all or substantially all
of the assets or Voting Stock of such a Person, so long as (i) no Default
or Event of Default exists or would exist after giving effect to such
acquisition, (ii) the Board of Directors or other governing body of such
Person whose assets or Voting Stock is being so acquired has approved the
terms of such acquisition, (iii) the Company shall have delivered to the
Lenders an updated Schedule 6.2 to reflect any new Subsidiary resulting
from such acquisition, (iv) the aggregate amount expended by the Company
and its Subsidiaries as consideration for such acquisition (and in any
event (1) including as such consideration, any Indebtedness for Borrowed
Money assumed or incurred as a result of such acquisition and (2)
excluding as such consideration, any equity securities issued by the
Company as consideration for such acquisition), when taken together with
the aggregate amount expended on a cumulative basis after the date hereof
as consideration (again, similarly including Indebtedness for Borrowed
Money assumed or incurred and excluding equity securities issued) for all
other acquisitions permitted under this Section 8.12(h) does not aggregate
more than $25,000,000, (v) the Company can demonstrate that on a pro forma
basis (including financial projections for the twelve months following the
subject acquisition) after giving effect to the subject acquisition it
will continue to comply with all the terms and conditions of the Loan
Documents, and (vi) the Company has provided to the Lenders financial
statements of the Person whose assets or Voting Stock is being so
acquired, including historical financial statements, and a description of
such Person and its business;
(i) investments, loans, advances and guaranties not otherwise
permitted by this Section aggregating not more than $100,000 at any one
time outstanding.
In determining the amount of investments, acquisitions, loans,
advances and guarantees permitted under this Section 8.12, investments and
acquisitions shall always be taken at the original cost thereof
(regardless of any subsequent appreciation or depreciation therein), loans
and advances shall be taken at the principal amount thereof then remaining
unpaid, and guarantees shall be taken at the amount of obligations
guaranteed thereby.
Section 8.13. Mergers, Consolidations and Sales. The Company shall
not, nor shall it permit any Subsidiary to, be a party to any merger or
consolidation, or sell, transfer, lease or otherwise dispose of all or any
substantial part of its Property, including any disposition of Property as part
of a sale and leaseback transaction, or in any event sell or discount (with or
without recourse) any of its notes or accounts receivable; provided, however,
that:
(a) any Subsidiary (including any corporation which immediately
after giving effect to an acquisition permitted by Section 8.12(h)
hereof becomes a Subsidiary, but in any event excluding any foreign
Subsidiary) may merge or consolidate with or into the Company or any
Wholly-Owned Subsidiary; provided that
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in any merger or consolidation involving the Company, the Company shall
be the surviving or continuing corporation, or, in the case of a merger or
consolidation of a Subsidiary and a Wholly-Owned Subsidiary, the
Wholly-Owned Subsidiary shall be the continuing or surviving corporation
and
(b) the Company and each Subsidiary may sell its inventory in the
ordinary course of its business.
A sale or disposition of five percent (5%) of the total assets of the Company
shall be deemed substantial for the foregoing purposes.
Section 8.14. Operating Leases. The Company will not, and will not
permit any of their respective Subsidiaries to, acquire the use or possession
of any Property under a lease or similar arrangement, whether or not the
Company or any such Subsidiary has the express or implied right to acquire
title to or purchase such Property at any time if, after giving effect thereto,
the aggregate amount of fixed rentals and other consideration payable by the
Company and its Subsidiaries under all such leases or arrangements would exceed
$10,000,000 during any fiscal year of the Company. Capital Leases shall not be
included in computing compliance with this Section to the extent the Company's
and its Subsidiaries' liability in respect of the same is permitted by Section
8.10(b) hereof.
Section 8.15. Maintenance of Subsidiaries. The Company shall not
assign, sell or transfer, or permit any Subsidiary to issue, assign, sell or
transfer, any shares of capital stock of a Subsidiary provided that the
foregoing shall not operate to prevent the issuance, sale and transfer to any
person of any shares of capital stock of a Subsidiary solely for the purpose of
qualifying, and to the extent legally necessary to qualify, such person as a
director of such Subsidiary.
Section 8.16. Dividends and Certain Other Restricted Payments. The
Company will not during any fiscal year (a) declare or pay any dividends on or
make any other distributions in respect of any class or series of its capital
stock (other than dividends payable solely in its capital stock) or (b)
directly or indirectly purchase, redeem or otherwise acquire or retire any of
its capital stock (such non-excepted dividends, distributions, purchases,
redemptions, acquisitions and retirements being hereinafter collectively called
"Restricted Payments") provided, however, that the foregoing shall not apply
to or operate to prevent any Restricted Payments made in any fiscal year of the
Company if and to the extent that (i) at the time such Restricted Payment is
made and after giving effect thereto, (i) no Default or Event of Default shall
occur or be continuing and (ii) the aggregate amount of all Restricted Payments
made during such fiscal year does not exceed twenty-five percent (25%) of the
Company's Net Income for such fiscal year to date.
Section 8.17. ERISA. The Company shall, and shall cause each
Subsidiary to, promptly pay and discharge in all material respects all
obligations and liabilities arising under ERISA of a character which if unpaid
or unperformed might result in the imposition of a Lien against any of its
Properties. The Company shall, and shall cause each Subsidiary to, promptly
notify the Agent and each Lender of (i) the occurrence of any material
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reportable event (as defined in ERISA) with respect to a Plan, (ii) receipt of
any notice from the PBGC of its intention to seek termination of any Plan or
appointment of a trustee therefor, (iii) its intention to terminate or withdraw
from any Plan, and (iv) the occurrence of any event with respect to any Plan
which would result in the incurrence by the Company or any Subsidiary of any
material liability, fine or penalty, or any material increase in the contingent
liability of the Company or any Subsidiary with respect to any post-retirement
Welfare Plan benefit.
Section 8.18. Compliance with Laws. The Company shall, and shall
cause each Subsidiary to, comply in all material respects with the
requirements of all material federal, state and local laws, rules, regulations,
ordinances and orders applicable to or pertaining to their Properties or
business operations, non-compliance with which could have a material adverse
effect on the financial condition, Properties, business or operations of the
Company and its Subsidiaries, taken as a whole, or could result in a Lien upon
any of their Property.
Section 8.19. Burdensome Contracts With Affiliates. The Company
shall not, nor shall it permit any Subsidiary to, enter into any contract,
agreement or business arrangement with any of its Affiliates (other than with
Wholly-Owned Subsidiaries) on terms and conditions which are less favorable to
the Company or such Subsidiary than would be usual and customary in similar
contracts, agreements or business arrangements between Persons not affiliated
with each other.
Section 8.20. No Changes in Fiscal Year. Neither the Company nor any
Subsidiary shall change its fiscal year from its present basis without the
prior written consent of the Required Lenders.
Section 8.21. Change in the Nature of Business. The Company shall
not, and shall not permit any Subsidiary to, engage in any business or activity
if as a result the general nature of the business of the Company or any
Subsidiary would be changed in any material respect from the general nature of
the business engaged in by the Company or such Subsidiary on the date of this
Agreement.
Section 8.22. New Subsidiaries. No later than 30 days after the
close of each calendar quarter, the Company shall notify the Lenders in writing
of its formation or acquisition within such calendar quarter of each Subsidiary
not already appropriately reflected on Schedule 6.2 hereto. Such notice shall
include the name, jurisdiction of incorporation and percentage of the Company's
ownership of such Subsidiary, and Schedule 6.2 hereto shall be deemed amended
to include such information for each Subsidiary as to which the Lenders receive
such notice. The notice required by this Section shall be in addition to
whatever other notice of such Subsidiaries is required by Section 7.1(a) of
this Agreement.
SECTION 9. EVENTS OF DEFAULT AND REMEDIES.
Section 9.1. Events of Default. Any one or more of the following
shall constitute an "Event of Default" hereunder:
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(a) default in the payment when due of all or any part of the
principal of or interest on any Note (whether at the stated maturity
thereof or at any other time provided for in this Agreement) which
continues unremedied for three (3) days' or more after written notice from
the Agent or default in the payment when due of any fee or other
Obligation payable by the Company hereunder or under any other Loan
Document which continues unremedied for seven (7) days' or more after
written notice from the Agent; or
(b) default in the observance or performance of any covenant set
forth in Sections 8.10, 8.11, 8.12, 8.13, 8.15 or 8.16 hereof; or
(c) default in the observance or performance of any covenant set
forth in Sections 8.7, 8.8 or 8.9 hereof which continues unremedied for
ten (10) days or more after the earlier of (i) the date on which any
Authorized Representative of the Company has actual knowledge that the
event or condition giving rise to such default actually constitutes a
default under this Agreement or (ii) written notice of such default is
given to the Company by the Agent or any Lender; or
(d) default in the observance or performance of any other provision
hereof or of any other Loan Document which is not remedied within thirty
(30) days after the earlier of (i) the date on which any Authorized
Representative of the Company has actual knowledge that the event or
condition giving rise to such default actually constitutes a default under
a Loan Document or (ii) written notice of such default is given to the
Company by the Agent or any Lender; or
(e) any representation or warranty made by the Company herein or
in any other Loan Document, or in any statement or certificate
furnished by it pursuant hereto or thereto, or in connection with any
extension of credit made hereunder, proves untrue in any material respect
as of the date of the issuance or making thereof; or
(f) default shall occur under Indebtedness for Borrowed Money of
$500,000 or more (individually or in the aggregate) issued, assumed or
guaranteed by the Company or any Subsidiary, or under any indenture,
agreement or other instrument under which the same may be issued, and such
default shall continue for a period of time sufficient to permit the
acceleration of the maturity of any such Indebtedness for Borrowed Money
(whether or not such maturity is in fact accelerated), or Indebtedness for
Borrowed Money of $500,000 or more (individually or in the aggregate)
shall not be paid when due (whether by lapse of time, acceleration or
otherwise); or
(g) any judgment or judgments, writ or writs, or warrant or
warrants of attachment, or any similar process or processes in an
aggregate amount in excess of $500,000 shall be entered or filed against
the Company or any Subsidiary or against any of their Property and which
remains unvacated, unbonded, unstayed or unsatisfied for a period of
thirty (30) days; or
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(h) the Company or any member of its Controlled Group shall fail
to pay when due an amount or amounts aggregating in excess $500,000
which it shall have become liable to pay to the PBGC or to a Plan under
Title IV of ERISA; or notice of intent to terminate a Plan or Plans having
aggregate Unfunded Vested Liabilities in excess of $500,000 (collectively,
a "Material Plan") shall be filed under Title IV of ERISA by the Company
or any other member of its Controlled Group, any plan administrator or any
combination of the foregoing; or the PBGC shall institute proceedings
under Title IV of ERISA to terminate or to cause a trustee to be appointed
to administer any Material Plan or a proceeding shall be instituted by a
fiduciary of any Material Plan against the Company or any member of its
Controlled Group to enforce Section 515 or 4219(c)(5) of ERISA and such
proceeding shall not have been dismissed within thirty (30) days
thereafter; or a condition shall exist by reason of which the PBGC would
be entitled to obtain a decree adjudicating that any Material Plan must be
terminated; or
(i) dissolution or termination of the existence of the Company or
any Subsidiary (except for the dissolution of any Non-Material
Subsidiary permitted by Section 8.1 hereof); or
(j) thirty (30) days' shall have elapsed after the Company has
received written notice from the Agent that there has occurred any
material adverse change in the condition (financial or otherwise) or
business prospects of the Company and its Subsidiaries, taken as a whole,
which is not remedied in such period; or
(k) the Company or any Material Subsidiary shall (i) have entered
involuntarily against it an order for relief under the United States
Bankruptcy Code, as amended, (ii) not pay, or admit in writing its
inability to pay, its debts generally as they become due, (iii) make an
assignment for the benefit of creditors, (iv) apply for, seek, consent to,
or acquiesce in, the appointment of a receiver, custodian, trustee,
examiner, liquidator or similar official for it or any substantial part of
its Property, (v) institute any proceeding seeking to have entered against
it an order for relief under the United States Bankruptcy Code, as
amended, to adjudicate it insolvent, or seeking dissolution, winding up,
liquidation, reorganization, arrangement, adjustment or composition of it
or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors or fail to file an answer or other
pleading denying the material allegations of any such proceeding filed
against it, (vi) take any corporate action in furtherance of any matter
described in parts (i) through (v) above, or (vii) fail to contest in good
faith any appointment or proceeding described in Section 9.1(l) hereof; or
(l) a custodian, receiver, trustee, examiner, liquidator or similar
official shall be appointed for the Company or any Material Subsidiary
or any substantial part of any of their Property, or a proceeding
described in Section 9.1(k)(v) shall be instituted against the Company or
any Material Subsidiary, and such appointment continues undischarged or
such proceeding continues undismissed or unstayed for a period of sixty
(60) days.
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Section 9.2. Non-Bankruptcy Defaults. When any Event of Default
described in subsection (a) through (j), both inclusive, of Section 9.1 has
occurred and is continuing, the Agent shall, upon the request of the Required
Lenders, by notice to the Company, take one or more of the following actions:
(a) terminate the obligations of the Lenders to extend any further
credit hereunder on the date (which may be the date thereof) stated in
such notice;
(b) declare the principal of and the accrued interest on the Notes
to be forthwith due and payable and thereupon the Notes, including both
principal and interest and all fees, charges and other Obligations payable
hereunder and under the other Loan Documents, shall be and become
immediately due and payable without further demand, presentment, protest
or notice of any kind; and
(c) enforce any and all rights and remedies available to it under
the Loan Documents or applicable law.
Section 9.3. Bankruptcy Defaults. When any Event of Default described
in subsection (k) or (l) of Section 9.1 has occurred and is continuing, then
the Notes, including both principal and interest, and all fees, charges and
other Obligations payable hereunder and under the other Loan Documents, shall
immediately become due and payable without presentment, demand, protest or
notice of any kind, and the obligations of the Lenders to extend further credit
pursuant to any of the terms hereof shall immediately terminate. In addition,
the Agent may exercise any and all remedies available to it under the Loan
Documents or applicable law.
SECTION 10. THE AGENT.
Section 10.1. Appointment and Authorization. Each Lender hereby
appoints and authorizes the Agent to take such action as agent on its behalf
and to exercise such powers hereunder and under the other Loan Documents as are
designated to the Agent by the terms hereof and thereof together with such
powers as are reasonably incidental thereto. The Lenders expressly agree that
the Agent is not acting as a fiduciary of the Lenders in respect of the Loan
Documents, the Company or otherwise, and nothing herein or in any of the other
Loan Documents shall result in any duties or obligations on the Agent or any of
the Lenders except as expressly set forth herein. The Agent may resign at any
time by sending twenty (20) days prior written notice to the Company and the
Lenders and may be removed by the Required Lenders upon twenty (20) days prior
written notice to the Company, the Agent and the Lenders. In the event of any
such resignation or removal the Required Lenders may appoint a new agent after
consultation with the Company, which shall succeed to all the rights, powers
and duties of the Agent hereunder and under the other Loan Documents. Any
resigning or removed Agent shall be entitled to the benefit of all the
protective provisions hereof with respect to its acts as an agent hereunder,
but no successor Agent shall in any event be liable or responsible for any
actions of its predecessor. If the Agent resigns or is removed and no
successor is appointed, the rights and obligations of such
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Agent shall be automatically assumed by the Required Lenders and the
Company shall be directed to make all payments due each Lender hereunder
directly to such Lender.
Section 10.2. Rights as a Lender. The Agent has and reserves all of
the rights, powers and duties hereunder and under the other Loan Documents as
any Lender may have and may exercise the same as though it were not the Agent
and the terms "Lender" or "Lenders" as used herein and in all of such documents
shall, unless the context otherwise expressly indicates, include the Agent in
its individual capacity as a Lender.
Section 10.3. Standard of Care. The Lenders acknowledge that they
have received and approved copies of the Loan Documents and such other
information and documents concerning the transactions contemplated and financed
hereby as they have requested to receive and/or review. The Agent makes no
representations or warranties of any kind or character to the Lenders with
respect to the validity, enforceability, genuineness, perfection, value, worth
or collectibility hereof or of the Notes or any of the other Obligations or of
any of the other Loan Documents or of any other documents called for hereby or
thereby. Neither the Agent nor any director, officer, employee, agent or
representative thereof shall in any event be liable for action taken or omitted
to be taken by it or them hereunder or under the other Loan Documents or in
connection herewith or therewith except for its or their own gross negligence
or willful misconduct. The Agent shall incur no liability under or in respect
of this Agreement or the other Loan Documents by acting upon any notice,
certificate, warranty, instruction or statement (oral or written) of anyone
(including anyone reasonably believed by it to be authorized to act on behalf
of the Company), unless it has actual knowledge of the untruthfulness of same.
The Agent may execute any of its duties hereunder by or through employees,
agents, and attorneys-in-fact and shall not be answerable to the Lenders for
the default or misconduct of any such agents or attorneys-in-fact selected with
reasonable care. The Agent shall be entitled to advice of counsel concerning
all matters pertaining to the agencies hereby created and its duties hereunder,
and shall incur no liability to anyone and be fully protected in acting upon
the advice of such counsel. The Agent shall be entitled to assume that no
Default or Event of Default exists unless notified to the contrary by a Lender
or the Company. The Agent shall in all events be fully protected in acting or
failing to act in accord with the instructins of the Required Lenders. Upon
the occurrence of an Event of Default hereunder, the Agent shall take such
action with respect to the enforcement of the Obligations as it shall be
directed to take by the Required Lenders but unless and until the Required
Lenders have given such direction the Agent shall take or refrain from taking
such actions as it deems appropriate and in the best of interest of all
Lenders. The Agent shall in all cases be fully justified in failing or
refusing to act hereunder unless it shall be indemnified to its satisfaction by
the Lenders against any and all liability and expense which may be incurred by
the Agent by reason of taking or continuing to take any such action. The Agent
may treat the owner of any Note as the holder thereof until written notice of
transfer shall have been filed with the Agent signed by such owner in form
satisfactory to the Agent. Each Lender acknowledges that it has independently
and without reliance on the Agent or any other Lender and based upon such
information, investigations and inquiries as it deems appropriate made its own
credit analysis and decision to extend credit to the Company. It shall be the
responsibility of each Lender to keep itself informed as to the
creditworthiness of the Company and the Agent shall have
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no liability to any Lender with respect thereto; provided, however,
that the Agent shall, at its own expense, provide to each Lender (in addition
to such other information as the Loan Documents expressly require the Agent
furnish to the Lenders) a copy of each communication which the Agent shall
receive from the Company notifying the Agent of or discussing any Default or
Event of Default to occur or which has occurred, promptly following the Agent's
receipt thereof unless the Agent reasonably believes such communication has
already been sent to the Lenders.
Section 10.4. Costs and Expenses. Each Lender agrees to reimburse
the Agent for all costs and expenses suffered or incurred by the Agent or any
security trustee in performing its duties hereunder and under the other Loan
Documents, or in the exercise of any right or power imposed or conferred upon
the Agent hereby or thereby, to the extent that the Agent is not promptly
reimbursed for same by the Company, all such costs and expenses to be borne by
the Lenders ratably in accordance with the amounts of their respective
Commitments. If any Lender fails to reimburse the Agent for such Lender's
share of any such costs and expenses, such costs and expenses shall be paid pro
rata by the remaining Lenders, but without in any manner releasing the
defaulting Lender from its liability hereunder.
Section 10.5. Indemnity. The Lenders shall ratably indemnify and
hold the Agent, and its directors, officers, employees, agents and
representatives (including as such any security trustee therefor) harmless from
and against any liabilities, losses, costs and expenses suffered or incurred by
them hereunder or under the other Loan Documents or in connection with the
transactions contemplated hereby or thereby, regardless of when asserted or
arising, except to the extent they are promptly reimbursed for the same by the
Company and except to the extent that any event giving rise to a claim was
caused by the gross negligence or willful misconduct of the party seeking to be
indemnified. If any Lender defaults in its obligations hereunder, its share of
the obligations shall be paid pro rata by the remaining Lenders, but without in
any manner releasing the defaulting Lender from its liability hereunder.
Section 10.6. Agent's Relationship with Company. The provisions of
this Section 10 shall be binding upon and sets forth agreements by and among
each Lender and the Agent. The provisions of this Section 10 shall in no way
amend, alter, modify, restrict or otherwise affect the agreements of the
Company with the Agent and with the Lenders otherwise set forth in this
Agreement.
SECTION 11. MISCELLANEOUS.
Section 11.1. Non-Business Days. If any payment hereunder becomes
due and payable on a day which is not a Business Day, the due date of such
payment shall be extended to the next succeeding Business Day on which date
such payment shall be due and payable. In the case of any payment of principal
falling due on a day which is not a Business Day, interest on such principal
amount shall continue to accrue during such extension at the rate per annum
then in effect, which accrued amount shall be due and payable on the next
scheduled date for the payment of interest.
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Section 11.2. No Waiver, Cumulative Remedies. No delay or failure on
the part of any Lender or on the part of any holder of any of the Obligations
in the exercise of any power or right shall operate as a waiver thereof or as
an acquiescence in any default, nor shall any single or partial exercise of any
power or right preclude any other or further exercise thereof or the exercise
of any other power or right. The rights and remedies hereunder of the Lenders
and any of the holders of the Obligations are cumulative to, and not exclusive
of, any rights or remedies which any of them would otherwise have.
Section 11.3. Waivers, Modifications and Amendments. Any provision
hereof or of any of the other Loan Documents may be amended, modified, waived
or released and any Default or Event of Default and its consequences may be
rescinded and annulled upon the written consent of the Company and the Required
Lenders; provided, however, that without the consent of all Lenders no such
amendment, modification or waiver shall increase the amount or extend the terms
of any Lender's Commitment or reduce the interest rate applicable to or extend
the maturity of any Obligation owed to it or reduce the amount of any principal
of or interest on any Loan or any fees to which it is entitled hereunder or
change this Section 11.3 or change the definition of "Required Lenders" or
change the number of Lenders required to take any action hereunder or under any
of the other Loan Documents. No amendment, modification or waiver of the
Agent's protective provisions shall be effective without the prior written
consent of the Agent.
Section 11.4. Costs and Expenses. The Company agrees to pay on demand
all the reasonable costs and expenses of the Agent and (to the extent incurred
prior to December 31, 1995) each Lender in connection with the negotiation,
preparation, execution and delivery of this Agreement, the other Loan Documents
and the other instruments and documents to be delivered hereunder or
thereunder, and in connection with the transactions contemplated hereby or
thereby, and in connection with any consents hereunder or waivers or amendments
hereto or thereto, and in connection with any Default or Event of Default, and
in connection with the enforcement of this Agreement or any of the other Loan
documents or any other instrument or document delivered hereunder or
thereunder, including the fees and expenses of Messrs. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇,
counsel for the Agent, with respect to all of the foregoing (whether or not the
transactions contemplated hereby are consummated). Upon the occurrence and
during the continuation of any Default or Event of Default, the Company further
agrees to pay to the Lenders and any other holders of the Obligations all the
reasonable costs and expenses (including court costs and attorneys' fees), if
any, incurred or paid upon the occurrence and during the continuation of any
Default or Event of Default by the Lenders or any other holders of the
Obligations in connection with any Default or Event of Default, and in
connection with the enforcement of this Agreement or any of the other Loan
Documents or any other instrument or document delivered hereunder or
thereunder. The Company further agrees to indemnify and save the Lenders, the
Agent and any security trustee for the Lenders harmless from any and all
liabilities, losses, costs and expenses incurred by the Lenders or the Agent in
connection with any action, suit or proceeding brought against the Agent, or
any security trustee or any Lender by any Person which arises out of the
transactions contemplated or financed hereby or out of any action or inacton by
the Agent, any security trustee or any Lender hereunder or thereunder, except
for such thereof (i) as is caused by the gross negligence or willful
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misconduct of the party seeking to be indemnified or (ii) arises in
connection with litigation solely between the Lenders. The provisions of this
Section 11.4 and the protective provisions of Section 2 hereof shall survive
payment of the Obligations.
Section 11.5. Documentary Taxes. The Company agrees to pay on demand
any documentary, stamp or similar taxes payable in respect of this Agreement or
any other Loan Document, including interest and penalties, in the event any
such taxes are assessed, irrespective of when such assessment is made and
whether or not any credit is then in use or available hereunder.
Section 11.6. Survival of Representations. All representations and
warranties made herein or in any of the other Loan Documents or in certificates
given pursuant hereto or thereto shall survive the execution and delivery of
this Agreement and the other Loan Documents, and shall continue in full force
and effect with respect to the date as of which they were made as long as any
credit is in use or available hereunder.
Section 11.7. Survival of Indemnities. All indemnities and other
provisions relative to reimbursement to the Agent and the Lenders of amounts
sufficient to protect the yield of the Agent and the Lenders with respect to
the Loans, including, but not limited to, Sections 2.7, 2.8 and 2.9 hereof,
shall survive in accordance with their terms the termination of this Agreement
and the payment of the Obligations.
Section 11.8. Participations. Any Lender may grant participations in
its extensions of credit hereunder to any other Lender or other lending
institution (a "Participant"), provided that (i) no Participant shall thereby
acquire any direct rights under this Agreement, (ii) no Lender shall agree with
a Participant not to exercise any of such Lender's rights hereunder without the
consent of such Participant except for rights which under the terms hereof may
only be exercised by all Lenders and (iii) no sale of a participation in
extensions of credit shall in any manner relieve the selling Lender of its
obligations hereunder.
Section 11.9. Assignment Agreements. Each Lender may, from time to
time upon at least ten (10) Business Days' prior written notice to the Agent,
assign to other commercial lenders part of its rights and obligations under
this Agreement (including without limitation the indebtedness evidenced by the
Notes then owned by such assigning Lender, together with an equivalent
proportion of its Commitments to make Loans hereunder) pursuant to written
agreements executed by such assigning Lender, such assignee lender or lenders,
the Company and the Agent, which agreements shall specify in each instance the
portion of the indebtedness evidenced by the Notes which is to be assigned to
each such assignee lender and the portion of the Commitments of the assigning
Lender to be assumed by it (the "Assignment Agreements"); provided, however,
that (i) each such assignment shall be of a constant, and not a varying,
percentage of the assigning Lender's rights and obligations under this
Agreement and the assignment shall cover the same percentage of such Lender's
Commitments, Loans and Notes; (ii) unless the Agent otherwise consents, the
aggregate amount of the Commitments, Loans and Notes of the assigning Lender
being assigned pursuant to each such assignment (determined as of the effective
date of the relevant Assignment Agreement) shall in no event be less than
$5,000,000 (or $1,000,000 in the case
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of assignments requested by the Company in accordance with the last sentence of
this Section) and shall in each case be an integral multiple of $1,000,000;
(iii) the Agent and the Company must each consent, which consent shall not be
unreasonably withheld, to each such assignment to a party which was not an
original signatory of this Agreement; and (iv) the assigning Lender must pay to
the Agent a processing and recordation fee of $2,500 and any out-of-pocket
attorneys' fees and expenses incurred by the Agent in connection with such
Assignment Agreement. Upon the execution of each Assignment Agreement by the
assigning Lender theeunder, the assignee lender thereunder, the Company and the
Agent and payment to such assigning Lender by such assignee lender of the
purchase price for the portion of the indebtedness of the Company being
acquired by it, (i) such assignee lender shall thereupon become a "Lender" for
all purposes of this Agreement with Commitments in the amounts set forth in
such Assignment Agreement and with all the rights, powers and obligations
afforded a Lender hereunder, (ii) such assigning Lender shall have no further
liability for funding the portion of its Commitments assumed by such other
Lender and (iii) the address for notices to such assignee Lender shall be as
specified in the Assignment Agreement executed by it. Concurrently with the
execution and delivery of such Assignment Agreement, the Company shall execute
and deliver Notes to the assignee Lender in the respective amounts of its
Facility A Commitment, Facility B Commitment (if activated) and Facility B Term
Loans (if any are outstanding) and new Notes to the assigning Lender in the
respective amounts of its Facility A Commitment, Facility B Commitment (if
activated), and Facility B Term Loans (if any are outstanding) after giving
effect to the reduction occasioned by such assignment, all such Notes to
constitute "Notes" for all purposes of this Agreement and of the other Loan
Documents.
Section 11.10. Notices. Except as otherwise specified herein, all
notices hereunder shall be in writing (including cable or telecopy) and shall
be given to the relevant party at its address, telecopier number or telex
number set forth below, in the case of the Company, or on the appropriate
signature page hereof, in the case of the Lenders and the Agent, or such other
address or telecopier number as such party may hereafter specify by notice to
the Agent and the Company given by United States certified or registered mail,
by telecopy or by other telecommunication device capable of creating a written
record of such notice and its receipt. Notices hereunder to the Company shall
be addressed to:
APAC TeleServices, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, Chief Financial Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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With a copy (in the case of notices of default) to:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Each such notice, request or other communication shall be effective (i) if
given by telecopier, when such telecopy is transmitted to the telecopier number
specified in this Section 11.10 and a confirmation of such telecopy has been
received by the sender, (ii) if given by mail, five (5) days after such
communication is deposited in the mail, certified or registered with return
receipt requested, addressed as aforesaid or (iii) if given by any other means,
when delivered at the addresses specified in this Section 11.10; provided that
any notice given pursuant to Section 1 or Section 2 hereof shall be effective
only upon receipt.
Section 11.11. Construction. The parties hereto acknowledge and agree
that this Agreement and the other Loan Documents shall not be construed more
favorably in favor of one than the other based upon which party drafted the
same, it being acknowledged that all parties hereto contributed substantially
to the negotiation of this Agreement and the other Loan Documents. Nothing
contained herein shall be deemed or construed to permit any act or omission
which is prohibited by the terms of any of the other Loan Documents, the
covenants and agreements contained herein being in addition to and not in
substitution for the covenants and agreements contained in the other Loan
Documents.
Section 11.12. Headings. Section headings used in this Agreement are
for convenience of reference only and are not a part of this Agreement for any
other purpose.
Section 11.13. Severability of Provisions. Any provision of this
Agreement which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction. All rights, remedies and powers provided in this Agreement and
the other Loan Documents may be exercised only to the extent that the exercise
thereof does not violate any applicable mandatory provisions of law, and all
the provisions of this Agreement and the other Loan Documents are intended to
be subject to all applicable mandatory provisions of law which may be
controlling and to be limited to the extent necessary so that they will not
render this Agreement or the other Loan Documents invalid or unenforceable.
Section 11.14. Counterparts. This Agreement may be executed in any number
of counterparts, and by different parties hereto on separate counterpart
signature pages, and all such counterparts taken together shall be deemed to
constitute one and the same instrument.
Section 11.15. Entire Understanding. This Agreement together with the
other Loan Documents constitute the entire understanding of the parties with
respect to the subject
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matter hereof and any prior agreements, whether written or oral, with
respect thereto are superseded hereby except for prior understandings related
to fees payable to the Agent upon the initial closing of the transactions
contemplated hereby.
Section 11.16. Extensions of the Facility A Commitments. No later
than ninety (90) days prior to the Facility A Termination Date, the Company may
advise the Agent in writing of its desire to extend the Facility A Termination
Date for an additional twelve (12) months and the Agent shall promptly notify
the Lenders of each such request. The Facility A Termination Date may be
extended more than once pursuant to the terms of this Section, but in no event
shall the Facility A Termination Date be extended beyond May 31, 2001. In the
event that all the Lenders are agreeable to such extension (it being understood
that any Lender may accept or decline such a request in its sole discretion),
the Facility A Termination Date shall be so extended and the Company, the
Lenders and the Agent shall enter into such documents as such parties may
reasonably deem necessary or appropriate to reflect such extension. In the
event that some, but not all, of the Lenders are agreeable to an extension, the
Company may (provided that no Default or Event of Default has occurred and is
then continuing) (i) terminate the Commitments of the Lender or Lenders
declining to extend and repay all Loans and other Obligations (not just
Facility A Loans) owed to such Lender or Lenders and upon such repayment the
Commitments of such Lender or Lenders shall be canceled, (ii) revoke the
Company's request for extension of the Facility A Termination Date, or (iii) at
the option of the Company, the Company may obtain a new Lender or Lenders
reasonably acceptable to the Agent and the Required Lenders to replace the
Commitments of the Lender or Lenders declining to extend and in such event the
Commitments of the Lender or Lenders not desiring to extend shall be canceled.
In the event a Lender elects not to extend, all Loans and other Obligations
owed to such Lender (not just its Facility A Loans) shall be paid to it no
later than the then current Facility A Termination Date to which it has agreed.
The Company, the Agent and the new Lender shall therupon execute such
instruments and documents as shall in the opinion of the Agents be reasonably
necessary or appropriate to substitute the new approved Lender hereunder
(including without limitation the issuance of new Notes to the substitute
Lender, the execution of an Assignment Agreement as contemplated by Section
11.9 hereof or amendment to this Agreement in each case making the new Lender a
party hereto. The new Lender shall make initial Loans against its Notes in the
amount necessary to retire the indebtedness evidenced by the Notes held by the
declining Lender and all expenses of the Agent incurred in connection with the
foregoing shall be paid by the Company.
Section 11.17. Binding Nature, Governing Law, Etc. This Agreement
shall be binding upon the Company and its successors and assigns, and shall
inure to the benefit of the Agent and the Lenders and the benefit of their
successors and assigns, including any subsequent holder of an interest in the
Obligations. The Company may not assign its rights hereunder without the
written consent of the Lenders. THIS AGREEMENT AND THE RIGHTS AND DUTIES OF
THE PARTIES HERETO SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF ILLINOIS WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAWS.
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Section 11.18. Submission to Jurisdiction; Waiver of Jury Trial.
The Company hereby submits to the nonexclusive jurisdiction of the United
States District Court for the Northern District of Illinois and of any Illinois
State court sitting in the City of Chicago for purposes of all legal
proceedings arising out of or relating to this Agreement, the other Loan
Documents or the transactions contemplated hereby or thereby. The Company
irrevocably waives, to the fullest extent permitted by law, any objection which
it may now or hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in such
a court has been brought in an inconvenient forum. The Company, the Agent, and
each Lender hereby irrevocably waives any and all right to trial by jury in any
legal proceeding arising out of or relating to any Loan Document or the
transactions contemplated thereby.
Upon your acceptance hereof in the manner hereinafter set forth, this
Agreement shall constitute a contract between us for the uses and purposes
hereinabove set forth.
Dated as of this 5th day of June, 1996.
APAC TELESERVICES, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chairman, President & CEO
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Accepted and Agreed to at Chicago, Illinois as of the day and year last
above written.
Each of the Lenders hereby agrees with each other Lender that if it
should receive or obtain any payment (whether by voluntary payment, by the
exercise of rights of set-off or banker's lien, by counterclaim or cross
action, or by the enforcement of any rights under this Agreement, any of the
other Loan Documents or otherwise) in respect of the Obligations in a greater
amount than such Lender would have received had such payment been made to the
Agent and been distributed among the Lenders as contemplated by Section 3.5
hereof then in that event the Lender receiving such disproportionate payment
shall purchase for cash without recourse from the other Lenders an interest in
the Obligations of the Company to such Lenders in such amount as shall result
in a distribution of such payment as contemplated by Section 3.5 hereof. In
the event any payment made to a Lender and shared with the other Lenders
pursuant to the provisions hereof is ever recovered from such Lender, the
Lenders receiving a portion of such payment hereunder shall restore the same to
the payor Lender, but without interest.
Amount and Percentage of Commitments:
Facility A Commitment: ▇▇▇▇▇▇ Trust And Savings Bank
$10,000,000
(50%)
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------
Facility B Commitment: Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
$10,000,000 Title: Vice President
(50%)
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Middle Market D
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telex: 254157
-51-
57
Facility A Commitment: The Northern Trust Company
$5,000,000
(25%)
By: /s/ ▇▇▇▇▇▇▇ Noken
Facility B Commitment: ---------------------------
$5,000,000 Name: ▇▇▇▇▇▇▇ Noken
(25%) Title: ________________________
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇/▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telex: 253879
58
Facility A Commitment: Bank of America Illinois
$5,000,000
(25%)
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Facility B Commitment: -----------------------
$5,000,000 Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
(25%) Title: Senior Vice President
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
59
Exhibit A
APAC TeleServices, Inc.
Revolving Note(Facility A)
Chicago, Illinois
$_______________ _______________, 19_____
On the Facility A Termination Date, for value received, the
undersigned, APAC TeleServices, Inc., an Illinois corporation (the "Company"),
hereby promises to pay to the order of ________________ (the "Lender"), at the
principal office of ▇▇▇▇▇▇ Trust and Savings Bank in Chicago, Illinois, the
principal sum of (i) _______________________ and no/100 Dollars ($___________),
or (ii) such lesser amount as may at the time of the maturity hereof, whether
by acceleration or otherwise, be the aggregate unpaid principal amount of all
Facility A Loans owing from the Company to the Lender under the Facility A
Credit provided for in the Credit Agreement hereinafter mentioned.
This Note evidences Facility A Loans constituting part of a "Domestic
Rate Portion" and "LIBOR Portions" as such terms are defined in that certain
Credit Agreement dated as of June 5, 1996 between the Company, ▇▇▇▇▇▇ Trust and
Savings Bank, individually and as Agent thereunder, and the other Lenders which
are now or may from time to time hereafter become parties thereto (said Credit
Agreement, as the same may be amended, modified or restated from time to time,
being referred to herein as the "Credit Agreement") made and to be made to the
Company by the Lender under the Facility A Credit provided for under the Credit
Agreement, and the Company hereby promises to pay interest at the office
described above on each Facility A Loan evidenced hereby at the rates and at
the times and in the manner specified therefor in the Credit Agreement.
Each Facility A Loan made under the Facility A Credit provided for in
the Credit Agreement by the Lender to the Company against this Note, any
repayment of principal hereon, the status of each such Facility A Loan from
time to time as part of the Domestic Rate Portion or a LIBOR Portion and, in
the case of any LIBOR Portion, the interest rate and Interest Period applicable
thereto shall be endorsed by the holder hereof on a schedule to this Note or
recorded on the books and records of the holder hereof (provided that such
entries shall be endorsed on a schedule to this Note prior to any negotiation
hereof). The Company agrees that in any action or proceeding instituted to
collect or enforce collection of this Note, the entries so endorsed on a
schedule to this Note or recorded on the books and records of the holder hereof
shall be prima facie evidence of the unpaid principal balance of this Note, the
status of each such loan from time to time as part of the Domestic Rate Portion
or a LIBOR Portion, and, in the case of any LIBOR Portion, the interest rate
and Interest Period applicable thereto.
60
This Note is issued by the Company under the terms and provisions of
the Credit Agreement, and this Note and the holder hereof are entitled to all
of the benefits and security provided for thereby or referred to therein, to
which reference is hereby made for a statement thereof. This Note may be
declared to be, or be and become, due prior to its expressed maturity,
voluntary prepayments may be made hereon, and certain prepayments are required
to be made hereon, all in the events, on the terms and with the effects
provided in the Credit Agreement. All capitalized terms used herein without
definition shall have the same meanings herein as such terms are defined in the
Credit Agreement.
Pursuant to the terms of the Credit Agreement, the Company hereby
promises to pay all reasonable costs and expenses (including attorneys' fees)
suffered or incurred by the holder hereof in collecting this Note. The Company
hereby waives presentment for payment and demand. This Note shall be construed
in accordance with, and governed by, the internal laws of the State of Illinois
without regard to principles of conflicts of laws.
APAC TELESERVICES, INC.
By: _________________________
Name: _____________________
Title: ____________________
-2-
61
Exhibit B
APAC TeleServices, Inc.
Revolving Note(Facility B)
Chicago, Illinois
$_______________ _______________, 19_____
On the Facility B Termination Date, for value received, the
undersigned, APAC TeleServices, Inc., an Illinois corporation (the "Company"),
hereby promises to pay to the order of ________________ (the "Lender"), at the
principal office of ▇▇▇▇▇▇ Trust and Savings Bank in Chicago, Illinois, the
principal sum of (i) _______________________ and no/100 Dollars ($___________),
or (ii) such lesser amount as may at the time of the maturity hereof, whether
by acceleration or otherwise, be the aggregate unpaid principal amount of all
Facility B Loans owing from the Company to the Lender under the Facility B
Credit provided for in the Credit Agreement hereinafter mentioned.
This Note evidences Facility B Loans constituting part of a "Domestic
Rate Portion" and "LIBOR Portions" as such terms are defined in that certain
Credit Agreement dated as of June 5, 1996 between the Company, ▇▇▇▇▇▇ Trust and
Savings Bank, individually and as Agent thereunder, and the other Lenders which
are now or may from time to time hereafter become parties thereto (said Credit
Agreement, as the same may be amended, modified or restated from time to time,
being referred to herein as the "Credit Agreement") made and to be made to the
Company by the Lender under the Facility B Credit provided for under the Credit
Agreement, and the Company hereby promises to pay interest at the office
described above on each Facility B Loan evidenced hereby at the rates and at
the times and in the manner specified therefor in the Credit Agreement.
Each Facility B Loan made under the Facility B Credit provided for in
the Credit Agreement by the Lender to the Company against this Note, any
repayment of principal hereon, the status of each such Facility B Loan from
time to time as part of the Domestic Rate Portion or a LIBOR Portion and, in
the case of any LIBOR Portion, the interest rate and Interest Period applicable
thereto shall be endorsed by the holder hereof on a schedule to this Note or
recorded on the books and records of the holder hereof (provided that such
entries shall be endorsed on a schedule to this Note prior to any negotiation
hereof). The Company agrees that in any action or proceeding instituted to
collect or enforce collection of this Note, the entries so endorsed on a
schedule to this Note or recorded on the books and records of the holder hereof
shall be prima facie evidence of the unpaid principal balance of this Note, the
status of each such loan from time to time as part of the Domestic Rate Portion
or a LIBOR Portion, and, in the case of any LIBOR Portion, the interest rate
and Interest Period applicable thereto.
62
This Note is issued by the Company under the terms and provisions of
the Credit Agreement, and this Note and the holder hereof are entitled to all
of the benefits and security provided for thereby or referred to therein, to
which reference is hereby made for a statement thereof. This Note may be
declared to be, or be and become, due prior to its expressed maturity,
voluntary prepayments may be made hereon, and certain prepayments are required
to be made hereon, all in the events, on the terms and with the effects
provided in the Credit Agreement. All capitalized terms used herein without
definition shall have the same meanings herein as such terms are defined in the
Credit Agreement.
Pursuant to the terms of the Credit Agreement, the Company hereby
promises to pay all reasonable costs and expenses (including attorneys' fees)
suffered or incurred by the holder hereof in collecting this Note. The Company
hereby waives presentment for payment and demand. This Note shall be construed
in accordance with, and governed by, the internal laws of the State of Illinois
without regard to principles of conflicts of laws.
APAC TELESERVICES, INC.
By: _________________________
Name: ___________________
Title: __________________
-2-
63
Exhibit C
APAC TELESERVICES, INC.
FACILITY B TERM NOTE
Chicago, Illinois
$_____________________ _______________, 19__
FOR VALUE RECEIVED, the undersigned, APAC TeleServices, Inc., an
Illinois corporation (the "Company"), hereby promises to pay to the order of
______________________ (the "Lender"), at the principal office of ▇▇▇▇▇▇ Trust
and Savings Bank in Chicago, Illinois, the principal sum of
______________________________ Dollars ($______________), in ____________
(____) consecutive quarter-annual principal installments, commencing on
________________, 19__ and continuing on the ______ day of each ______________,
______________, _______________ and _________________ occurring thereafter to
and including __________________, 19__, with each installment (except the last)
to be in the amount of one-twelfth (1/12th) of the face amount of this Note and
last such installment to be in the amount of all principal hereof not sooner
paid.
This Note evidences a Facility B Term Loan constituting part of a
"Domestic Rate Portion" and "LIBOR Portions" as such terms are defined in that
certain Credit Agreement dated as of June 5, 1996 by and between the Company,
▇▇▇▇▇▇ Trust and Savings Bank, individually and as Agent thereunder, and the
other Lenders which are now or may from time to time hereafter become parties
thereto (said Credit Agreement, as the same may be amended, modified or
restated from time to time, being referred to herein as the "Credit Agreement")
made to the Company by the Lender under the Credit Agreement, and the Company
hereby promises to pay interest at the office specified above on the loan
evidenced hereby at the rates and at the times and in the manner specified
therefor in the Credit Agreement.
Each repayment of the principal of the Facility B Term Loan made by the
Lender to the Company against this Note, the status of such Facility B Term
Loan from time to time as part of the Domestic Rate Portion or a LIBOR Portion
and, in the case of any LIBOR Portion, the interest rate and Interest Period
applicable thereto shall be endorsed by the holder hereof on a schedule to this
Note or recorded on the books and records of the holder hereof (provided that
such entries shall be endorsed on a schedule to this Note prior to any
negotiation hereof). The Company agrees that in any action or proceeding
instituted to collect or enforce collection of this Note, the entries so
endorsed on a schedule to this Note or recorded on the books and records of the
holder hereof shall be prima facie evidence of the unpaid balance of this Note
and the status of such loan from time to time as part of the Domestic Rate
Portion or a LIBOR Portion and, in the case of any LIBOR Portion, the interest
rate and Interest Period applicable thereto.
64
This Note is issued by the Company under the terms and provisions of the Credit
Agreement, and this Note and the holder hereof are entitled to all of the
benefits and security provided for thereby or referred to therein, to which
reference is hereby made for a statement thereof. This Note may be declared to
be, or be and become, due prior to its expressed maturity, voluntary
prepayments may be made hereon, and certain prepayment are required to be made
hereon, all in the events, on the terms and with the effects provided in the
Credit Agreement. All capitalized terms used herein without definition shall
have the same meanings herein as such terms are defined in the Credit
Agreement.
Pursuant to the terms of the Credit Agreement, the Company hereby promises to
pay all reasonable costs and expenses (including attorneys' fees) suffered or
incurred by the holder hereof in collecting this Note. The Company hereby
waives presentment for payment and demand. THIS NOTE SHALL BE CONSTRUED IN
ACCORDANCE WITH, AND GOVERNED BY, THE INTERNAL LAWS OF THE STATE OF ILLINOIS
WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAW.
APAC TeleServices, Inc.
By: _______________________
Name: _____________________
Title: ____________________
-2-
65
Exhibit D
Compliance Certificate
This Compliance Certificate is furnished to (the Agent and the Lenders)
pursuant to that certain Credit Agreement dated as of June 5, 1996, by and
among APAC TeleServices, Inc. (the "Company") and you (the "Credit Agreement").
Unless otherwise defined herein, the terms used in this Compliance Certificate
have the meanings ascribed thereto in the Credit Agreement.
The Undersigned hereby certifies that:
1. I am the duly elected _____________________________________ of the
Company;
2. I have reviewed the terms of the Credit Agreement and I have made, or
have caused to be made under my supervision, a detailed review of the
transactions and conditions of the Company and its Subsidiaries during the
accounting period covered by the attached financial statements;
3. The examinations described in paragraph 2 did not disclose, and I have
no knowledge of, the existence of any condition or the occurrence of any event
which constitutes a Default or Event of Default during or at the end of the
accounting period covered by the attached financial statements or as of the
date of this Certificate, except as set forth below;
4. The financial statements required by Section 8.5 of the Credit
Agreement and being furnished to you concurrently with this Certificate are
true, correct and complete as of the date and for the periods covered thereby;
and
5. The Attachment hereto sets forth financial data and computations
evidencing the Company's compliance with certain covenants of the Credit
Agreement, all of which data and computations are, to the best of my knowledge,
true, complete and correct and have been made in accordance with the relevant
Sections of the Credit Agreement.
Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, the nature of the condition or event, the period during which it has
existed and the action which the Company has taken, is taking, or proposes to
take with respect to each such condition or event:
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
66
The foregoing certifications, together with the computations set forth in the
Attachment hereto and the financial statements delivered with this Certificate
in support hereof, are made and delivered this _________ day of
__________________ 19___.
__________________________________________
___________________, _____________________
(Name) (Title)
-2-
67
ATTACHMENT TO COMPLIANCE CERTIFICATE
APAC TELESERVICES, INC.
Compliance Calculations for Credit Agreement
Dated as of June 5, 1996
Calculations as of _____________, 19___
___________________________________________________________________________
A. Modified Leverage Ratio (Section 8.7)
1. Indebtedness for Borrowed Money as defined -------
2. Tangible Net Worth as defined -------
3. Total Capitalization (Line 1 plus Line 2) -------
4. Ratio of Indebtedness for Borrowed Money (Line 1)
to Total Capitalization (Line 3)
("Modified Leverage Ratio") :1
=======
5. As listed in Section 8.7, for the date
of this Certificate, Modified Leverage Ratio
shall not be greater than 0.40:1
=======
6. Company is in compliance?
(Circle yes or no) Yes/No
=======
B. Debt Service Coverage (Section 8.8)
1. Indebtedness for Borrowed
Money as defined ---------
2. Net Income as defined
for past four quarters ---------
3. Amounts deducted in arriving
at Net Income
in respect of ---------
(a) Interest Expense ---------
68
(b) Taxes imposed on or
measured by income or
excess profits ---------------
(c) Depreciation of Fixed
assets ---------------
(d) Amortization of
intangible assets ---------------
4. Sum of Lines 2, 3(a),
3(b), 3(c) and 3(d) ("EBITDA") --------------
5. Ratio of Indebtedness for Borrowed Money
(Line 1) to EBITDA(Line 4)("Debt
Service Coverage Ratio") :1
-------------
6. As listed in Section 8.8, for
the date of this Certificate,
the Debt Service Coverage Ratio
must be in an amount not more than 1.0:1
=============
7. Company is in compliance?
(Circle yes or no) Yes/No
=============
C. Fixed Charge Coverage (Section 8.9)
1. EBITDA (Line B4 above) -------------
2. Aggregate amount of principal
payments required to be made
on Indebtedness for Borrowed
Money -------------
3. Interest Expense -------------
4. Capital Expenditures -------------
5. Sum of Lines 2, 3 and 4
("Fixed Charges") --------------
6. Ratio of EBITDA (Line 1) to Fixed Charges
(Line 5) ("Fixed Charge Coverage Ratio") :1
--------------
-2-
69
7. As listed in Section 8.9, for
the date of this Certificate,
the Fixed Charge Coverage Ratio
must be in an amount not less than 1.25:1
===============
8. Company is in compliance?
(Circle yes or no) Yes/No
===============
-3-
70
SCHEDULE 6.2
SUBSIDIARIES
JURISDICTION OF PERCENTAGE
NAME INCORPORATION OWNERSHIP
APAC Teleservices of
Illinois, Inc. Illinois 100%
APAC Teleservices of
Michigan, Inc. Michigan 100%
71
SCHEDULE 8.11
PERMITTED DEBT
LENDER LIEN AMOUNT
FIRSTAR BANK -
MILWAUKEE CERTAIN EQUIPMENT $84,135
COMERICA BANK - ILLINOIS CERTAIN EQUIPMENT $84,235
BANC ONE LEASING CERTAIN EQUIPMENT $64,623
COMERICA BANK - ILLINOIS CERTAIN EQUIPMENT $7,574
E/S LEASING CERTAIN EQUIPMENT $76,535
GE CAPITAL LEASING CERTAIN EQUIPMENT $59,063
AT&T CAPITAL LEASING CERTAIN EQUIPMENT $40,883
TOTAL: $417,048