Exhibit 10.1
CREDIT AGREEMENT
CREDIT AGREEMENT dated as of March 30, 2004 among The Kansas City Southern
Railway Company, a Missouri corporation (the "Borrower"), Kansas City Southern,
a Delaware corporation (the "Parent"), the Subsidiary Guarantors (as hereinafter
defined), the Lenders (as hereinafter defined), the Issuing Bank (as hereinafter
defined), the Swing Line Bank (as hereinafter defined), The Bank of Nova Scotia
("BNS"), as collateral agent (together with any successor collateral agent
appointed pursuant to Article VII, the "Collateral Agent") for the Secured
Parties (as hereinafter defined), and BNS, as administrative agent (together
with any successor administrative agent appointed pursuant to Article VII, the
"Administrative Agent" and, together with the Collateral Agent, the "Agents")
for the Lender Parties (as hereinafter defined), Morgan Stanley Senior Funding,
Inc. ("Morgan Stanley"), as syndication agent, and BNS and Morgan Stanley, as
joint lead arrangers and joint bookrunners (the "Arrangers") and Harris Trust
and Savings Bank, as documentation agent (the "Documentation Agent").
PRELIMINARY STATEMENTS:
(1) The Borrower has requested that the Lenders lend up to $250 million to
refinance and replace (such refinancing and replacement being referred to herein
as the "Refinancing") its existing $250 million amended and restated credit
agreement dated as of June 12, 2002 (as amended or otherwise modified prior to
the date hereof, the "Existing Credit Facility") and for other general corporate
purposes more fully described herein.
(2) The Lender Parties have indicated their willingness to agree to lend
such amounts and the Issuing Bank has agreed to issue Letters of Credit for the
account of the Borrower on the terms and conditions of this Agreement.
NOW,THEREFORE, in consideration of the premises and of the mutual covenants
and agreements contained herein, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"Administrative Agent" has the meaning specified in the recital of
parties to this Agreement.
"Administrative Agent's Account" means the account of the
Administrative Agent specified by the Administrative Agent in writing to
the Lender Parties from time to time.
"Advance" means a Term B Advance, a Revolving Credit Advance, a Swing
Line Advance or a Letter of Credit Advance.
"Affiliate" means, as to any Person, any other Person that, directly
or indirectly, controls, is controlled by or is under common control with
such Person or is a director or officer of such Person. For purposes of
this definition, the term "control" (including the terms "controlling",
"controlled by" and "under common control with") of a Person means the
possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of such Person, whether through
the ownership of Voting Interests, by contract or otherwise.
"Agents" has the meaning specified in the recital of parties to this
Agreement.
"Applicable Lending Office" means, with respect to each Lender Party,
such Lender Party's Domestic Lending Office in the case of a Base Rate
Advance and such Lender Party's Eurodollar Lending Office in the case of a
Eurodollar Rate Advance.
"Applicable Margin" means (a) in respect of the Revolving Credit
Facility and the Swing Line Facility, (i) for the first six months
following the Effective Date, 1.25% per annum for Base Rate Advances and
2.25% per annum for Eurodollar Rate Advances and (ii) thereafter, a
percentage per annum determined by reference to the Leverage Ratio as set
forth below:
================================ =============================== =======================================
Leverage Ratio Base Rate Advances Eurodollar Rate Advances
================================ =============================== =======================================
================================ =============================== =======================================
Level I
less than 3.25: 1.00 0.75% 1.75%
-------------------------------- ------------------------------- ---------------------------------------
-------------------------------- ------------------------------- ---------------------------------------
Level II
3.25: 1.00 or greater,
but less than or equal to
4.25: 1.00 1.00% 2.00%
-------------------------------- ------------------------------- ---------------------------------------
-------------------------------- ------------------------------- ---------------------------------------
Level III
greater than 4.25: 1.00 but
less than or equal to 5.25:1.00 1.25% 2.25%
-------------------------------- ------------------------------- ---------------------------------------
-------------------------------- ------------------------------- ---------------------------------------
Level IV
greater than 5.25: 1.00 1.50% 2.50%
================================ =============================== =======================================
and (b) in respect of the Term B Facility, 1.00% per annum for Base Rate
Advances and 2.00% per annum for Eurodollar Rate Advances.
After the first six months after the Effective Date, the Applicable Margin
for each Base Rate Advance and the Applicable Margin for each Eurodollar
Rate Advance shall be determined by reference to the Leverage Ratio, in
effect on the first day of each Interest Period for such Advance as
reflected on the most recent financial statements delivered pursuant to
Sections 5.03(b) or (c), as the case may be; provided, however, that (A) no
change in the Applicable Margin shall be effective until three Business
Days after the date on which the Administrative Agent receives the
financial statements required to be delivered pursuant to Section 5.03(b)
or (c), as the case may be, and a certificate of the chief financial
officer or treasurer of the Borrower demonstrating such Leverage Ratio
and (B) the Applicable Margin shall be at Level IV (in the case of the
Revolving Credit Facility and the Swing Line Facility) for so long as the
Borrower has not submitted to the Administrative Agent the information
described in clause (A) of this proviso as and when required under
Section 5.03(b) or (c), as the case may be.
"Appropriate Lender" means, at any time, with respect to (a) any of
the Term B Facility or the Revolving Credit Facility, a Lender that has a
Commitment with respect to such Facility or has made an Advance with
respect to such Facility at such time, (b) the Letter of Credit Facility,
(i) the Issuing Bank and (ii) if the other Revolving Credit Lenders have
made Letter of Credit Advances pursuant to Section 2.03(c) that are
outstanding at such time, each such other Revolving Credit Lender and
(c) the Swing Line Facility, (i) the Swing Line Bank and (ii) if the other
Revolving Credit Lenders have made Swing Line Advances pursuant to
Section 2.02(b) that are outstanding at such time, each such other
Revolving Credit Lender.
"Approved Fund" means any Fund that is administered or managed by (i)
a Lender Party, (ii) an Affiliate of a Lender Party or (iii) an entity or
an Affiliate of an entity that administers or manages a Lender Party.
"Arrangers" has the meaning set forth in the recital of the parties
hereto.
"Assignment and Acceptance" means an assignment and acceptance entered
into by a Lender Party and an Eligible Assignee (with the consent of any
party whose consent is required by Section 9.07 or the definition of
"Eligible Assignee"), and accepted by the Administrative Agent, in
accordance with Section 9.07 and in substantially the form of Exhibit C
hereto or any other form approved by the Administrative Agent.
"Attributable Debt" means, in connection with any Sale and Leaseback
Transaction, the present value (discounted in accordance with GAAP at the
discount rate implied in the lease) of the obligations of the lessee for
rental payments during the term of the lease.
"Available Amount" of any Letter of Credit means, at any time, the
maximum amount available to be drawn under such Letter of Credit at such
time (assuming compliance at such time with all conditions to drawing).
"Bankruptcy Law" means any proceeding of the type referred to in
Section 6.01(f) or Title II, U.S. Code, or any similar foreign, federal or
state law for the relief of debtors.
"Base Rate" means a fluctuating interest rate per annum in effect from
time to time, which rate per annum shall at all times be equal to the
higher of:
(a) the rate of interest announced publicly by the Administrative
Agent in New York, New York, from time to time, as the Administrative
Agent's base or prime commercial lending rate; and
(b) 1/2 of 1% per annum above the Federal Funds Rate.
"Base Rate Advance" means an Advance that bears interest as provided
in Section 2.07(a)(i).
"BNS" has the meaning specified in the recital of parties to this
Agreement.
"Borrower" has the meaning specified in the recital of parties to this
Agreement.
"Borrower's Account" means the account of the Borrower specified by
the Borrower in writing to the Administrative Agent from time to time.
"Borrowing" means a Term B Borrowing, a Revolving Credit Borrowing or
a Swing Line Borrowing.
"Business Day" means any day that is not a Saturday or Sunday or any
other day on which banks are not required or authorized by law to close in
New York City and, if the applicable Business Day relates to any Eurodollar
Rate Advances, any day on which dealings are carried on in the London
interbank market.
"Capital Expenditures" means, for any Person for any period, the sum
of, without duplication, (a) all expenditures made by such Person during
such period for equipment, fixed assets, real property or improvements, or
for replacements or substitutions therefor or additions thereto, that have
been or should be, in accordance with GAAP, reflected as additions to
property, plant or equipment in a Consolidated statement of cash flows of
such Person for such period plus (b) the aggregate amount of all
Capitalized Lease Obligations assumed or incurred during such period.
"Capitalized Lease Obligations" means with respect to any Person the
Obligations of such Person to pay rent or other amounts under any lease of
(or other arrangement conveying the right to use) real or personal
property, or a combination thereof, which Obligations are required to be
classified and accounted for as a capital lease on a balance sheet of such
Person in accordance with GAAP and the amount of such Obligations shall be
the capitalized amount thereof determined in accordance with GAAP.
"Cash Equivalents" means any of the following, to the extent owned by
the Borrower or any of its Subsidiaries free and clear of all Liens other
than Liens created under the Collateral Documents: (a) readily marketable
direct obligations of the Government of the United States or any agency or
instrumentality thereof or obligations unconditionally guaranteed by the
full faith and credit of the Government of the United States, (b) insured
certificates of deposit of or time deposits with any commercial bank that
is a Lender Party or a member of the Federal Reserve System, is organized
under the laws of the United States or any State thereof and has combined
capital and surplus of at least $500 million, in each case, having a
maturity of not greater than 180 days from the date of acquisition thereof
(c) commercial paper maturing within 270 days from the date of acquisition
thereof in an aggregate amount of no more than $20 million per issuer
outstanding at any time, issued by any corporation organized under the laws
of any State of the United States and rated, at the time of acquisition, at
least "Prime-1" (or the then equivalent grade) by Moody's or "A-1" (or the
then equivalent grade) by S&P,
(d) Investments, classified in accordance with GAAP as Current Assets
of the Parent or any of its Subsidiaries, in money market investment
programs registered under the Investment Company Act of 1940, as amended,
which are administered by financial institutions that have the highest
commercial paper rating obtainable from either Moody's or S&P, and the
portfolios of which are limited solely to Investments of the character,
quality and maturity described in clauses (a), (b) and (c) of this
definition, (e) fully collateralized repurchase agreements with a term of
not more than 30 days for securities described in clause (a) above and
entered into with a financial institution satisfying the criteria described
in clause (b) above, or (f) such other liquid investments as shall be
approved by the Administrative Agent.
"Caymex" means Caymex Transportation, Inc., a Delaware corporation.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended from time to time.
"CERCLIS" means the Comprehensive Environmental Response, Compensation
and Liability Information System maintained by the U.S. Environmental
Protection Agency.
"Change of Control" shall be deemed to have occurred if (i) at any
time, less than 75% of the members of the board of directors of Parent
shall be (A) individuals who are members of such board on the date hereof
or (B) individuals whose election, or nomination for election by Parent's
stockholders, was approved by a vote of at least 75% of the members of the
board then still in office who are members of the board on the date hereof
(or whose election or nomination has been approved as provided in this
clause (B)), (ii) at any time, any person, or any two or more persons
acting as a partnership, limited partnership, syndicate, or other group for
the purpose of acquiring, holding or disposing of Equity Interests of
Parent, shall become, according to public announcement or filing, the
"beneficial owner" (as defined in Rule 13d-3 issued under the Securities
Exchange Act of 1934, as amended), directly or indirectly, of securities of
Parent representing 30% or more (calculated in accordance with such Rule
13d-3) of the combined voting power of Parent's then outstanding voting
securities, (iii) any Person other than Parent shall acquire ownership,
directly or indirectly, beneficially or of record of any Equity Interests
of the Borrower or (iv) a "Change of Control" (or similar event), as such
term may be defined in any indenture or other agreement or instrument
governing Material Debt, shall have occurred.
"Collateral" means all "Collateral" and "Mortgaged Property" referred
to in the Collateral Documents and all other property that is or is
intended to be subject to any Lien in favor of the Collateral Agent for the
benefit of the Secured Parties.
"Collateral Agent" has the meaning specified in the recital of parties
to this Agreement.
"Collateral Agent's Office" means, with respect to the Collateral
Agent or any successor Collateral Agent, the office of such Agent as such
Agent may from time to time specify to the Borrower and the Administrative
Agent.
"Collateral Documents" means the Security Agreement and the Mortgages,
each of the collateral documents, instruments and agreements delivered
pursuant to Section 5.01(i), and each other agreement that creates or
purports to create a Lien in favor of the Collateral Agent for the benefit
of the Secured Parties.
"Commitment" means a Term B Commitment, a Revolving Credit Commitment,
a Swing Line Commitment or a Letter of Credit Commitment.
"Confidential Information" means information that any Loan Party
furnishes to any Agent or any Lender Party in a writing designated as
confidential, but does not include any such information that is or becomes
generally available to the public other than as a result of a breach by
such Agent or any Lender Party of its obligations hereunder or that is or
becomes available to such Agent or such Lender Party from a source other
than the Loan Parties that is not, to the best of such Agent's or such
Lender Party's knowledge, acting in violation of a confidentiality
agreement with a Loan Party.
"Consolidated" refers to the consolidation of accounts in accordance
with GAAP.
"Consolidated Interest Expense" means, for any period, the sum,
without duplication, of (a) the interest expense (including imputed
interest expense in respect of Capitalized Lease Obligations) of the Parent
and its Subsidiaries for such period, determined on a Consolidated basis in
accordance with GAAP and (b) all cash dividends paid during such period by
the Parent and the Borrower with respect to the Convertible Preferred Stock
and Preferred Interests issued after the date hereof in respect of which
cash dividends are payable.
"Consolidated Net Income" means, for any period, the net income or
loss of the Parent and its Subsidiaries for such period determined on a
Consolidated basis in accordance with GAAP; provided that there shall be
excluded (a) the income of any Person that is not an Affiliate, except to
the extent of the amount of dividends or other distributions actually paid
to the Parent or any of its Subsidiaries during such period, and (b) the
income or loss of any Person accrued prior to the date it becomes a
Subsidiary of the Parent or is merged into or consolidated with the Parent
or any Subsidiary of the Parent or the date that such Person's assets are
acquired by the Parent or any of its Subsidiaries .
"Consolidated Net Worth" shall mean, on any date, the stockholders'
equity of the Parent and its Subsidiaries on such date, determined on a
consolidated basis in accordance with GAAP.
"Contingent Obligation" means, with respect to any Person, any
Obligation or arrangement of such Person to guarantee or intended to
guarantee any Debt, leases, dividends or other payment Obligations
("primary obligations") of any other Person (the "primary obligor") in any
manner, whether directly or indirectly, including, without
limitation, (a) the direct or indirect guarantee, endorsement (other
than for collection or deposit in the ordinary course of business),
co-making by such Person of the Obligation of a primary obligor, (b) the
Obligation to make take-or-pay or similar payments, if required, regardless
of nonperformance by any other party or parties to an agreement or (c) any
Obligation of such Person, whether or not contingent, (i) to purchase any
such primary obligation or any property constituting direct or indirect
security therefor, (ii) to advance or supply funds (A) for the purchase or
payment of any such primary obligation or (B) to maintain working capital
or equity capital of the primary obligor or otherwise to maintain the net
worth or solvency of the primary obligor, (iii) to purchase property,
assets, securities or services primarily for the purpose of assuring the
owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation, (iv) under Standby Letters of
Credit or (v) otherwise to assure or hold harmless the holder of such
primary obligation against loss in respect thereof. The amount of any
Contingent Obligation shall be deemed to be an amount equal to the stated
or determinable amount of the primary obligation in respect of which such
Contingent Obligation is made (or, if less, the maximum amount of such
primary obligation for which such Person may be liable pursuant to the
terms of the instrument evidencing such Contingent Obligation) or, if not
stated or determinable, the maximum reasonably anticipated liability in
respect thereof (assuming such Person is required to perform thereunder),
as determined by such Person in good faith.
"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 Parent or any of its
Subsidiaries, are treated as a single employer under Section 414(b) or
414(c) of the Internal Revenue Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Internal Revenue Code, are treated as a
single employer under Section 414(b), (c), (m) or (o) of the Internal
Revenue Code.
"Conversion", "Convert" and "Converted" each refer to a conversion of
Advances of one Type into Advances of the other Type pursuant to
Section 2.09 or 2.10.
"Convertible Preferred Stock" means the 4.25% redeemable cumulative
convertible preferred stock in an aggregate principal amount of $200
million issued by the Parent on May 5, 2003 pursuant to an offering
memorandum dated April 29, 2003.
"Current Assets" of any Person means, at any date of determination,
all assets of such Person that would, in accordance with GAAP, be
classified as current assets of a company conducting a business the same as
or similar to that of such Person, after deducting adequate reserves in
each case in which a reserve is proper in accordance with GAAP.
"Debt" of any Person means, without duplication, (a) all indebtedness
of such Person for borrowed money, (b) all Obligations of such Person for
the deferred purchase price of property or services (other than current
accounts payable incurred in the ordinary course of such Person's
business), (c) all Obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d) all Obligations of such Person
under any conditional sale or other title retention agreement with respect
to property acquired
by such Person, (e) all Capitalized Lease Obligations of such Person,
(f) all Obligations of such Person in respect of bankers acceptances and as
an account party in respect of letters of credit and letters of guaranty,
(g) all Contingent Obligations and Obligations in respect of Securitization
Transactions of such Person and (h) all indebtedness and other payment
Obligations referred to in clauses (a) through (g) above of another Person
secured by (or for which the holder of such Debt has an existing right,
contingent or otherwise, to be secured by) any Lien on property (including,
without limitation, accounts and contract rights) owned by such Person,
even though such Person has not assumed or become liable for the payment of
such indebtedness or other payment Obligations. The Debt of any Person
shall include the Debt of any other entity (including any partnership in
which such Person is a general partner) to the extent such Person is liable
therefor as a result of such Person's ownership interest in or other
relationship with such entity, except to the extent the terms of such Debt
provide that such Person is not liable therefor.
"Debt for Borrowed Money" means, at any date of determination, the sum
of (i) the aggregate principal amount of all Debt that, in accordance with
GAAP, would be classified as indebtedness on the balance sheet of the
Parent and its Subsidiaries at such date, and (ii) the aggregate amount of
all Securitization Transactions of the Borrower at such date.
"Default" means any Event of Default or any event that would
constitute an Event of Default but for the passage of time or the
requirement that notice be given or both.
"Default Interest" has the meaning set forth in Section 2.07(b).
"Defaulted Advance" means, with respect to any Lender Party at any
time, the portion of any Advance required to be made by such Lender Party
to the Borrower pursuant to Section 2.01 or 2.02 at or prior to such time
that has not been made by such Lender Party or by the Administrative Agent
for the account of such Lender Party pursuant to Section 2.02(e) as of such
time. In the event that a portion of a Defaulted Advance shall be deemed
made pursuant to Section 2.15(a), the remaining portion of such Defaulted
Advance shall be considered a Defaulted Advance originally required to be
made pursuant to Section 2.01 on the same date as the Defaulted Advance so
deemed made in part.
"Defaulted Amount" means, with respect to any Lender Party at any
time, any amount required to be paid by such Lender Party to any Agent or
any other Lender Party hereunder or under any other Loan Document at or
prior to such time that has not been so paid as of such time, including,
without limitation, any amount required to be paid by such Lender Party to
(a) the Swing Line Bank pursuant to Section 2.02(b) to purchase a portion
of a Swing Line Advance made by the Swing Line Bank, (b) the Issuing Bank
pursuant to Section 2.03(c) to purchase a portion of a Letter of Credit
Advance made by the Issuing Bank, (c) the Administrative Agent pursuant to
Section 2.02(e) to reimburse the Administrative Agent for the amount of any
Advance made by the Administrative Agent for the account of such Lender
Party, (d) any other Lender Party pursuant to Section 2.13 to purchase any
participation in Advances owing to such other Lender Party
and (e) any Agent or the Issuing Bank pursuant to Section 7.05 to
reimburse such Agent or the Issuing Bank for such Lender Party's ratable
share of any amount required to be paid by the Lender Parties to such Agent
or the Issuing Bank as provided therein. In the event that a portion of a
Defaulted Amount shall be deemed paid pursuant to Section 2.15(b), the
remaining portion of such Defaulted Amount shall be considered a Defaulted
Amount originally required to be paid hereunder or under any other Loan
Document on the same date as the Defaulted Amount so deemed paid in part.
"Defaulting Lender" means, at any time, any Lender Party that, at such
time, (a) owes a Defaulted Advance or a Defaulted Amount or (b) shall take
any action or be the subject of any action or proceeding of a type
described in Section 6.01(f).
"Domestic Lending Office" means, with respect to any Lender Party, the
office of such Lender Party specified as its "Domestic Lending Office"
opposite its name on Schedule I hereto or in the Assignment and Acceptance
pursuant to which it became a Lender Party, as the case may be, or such
other office of such Lender Party as such Lender Party may from time to
time specify to the Borrower and the Administrative Agent.
"EBITDA" means, at any date of determination, the sum, determined on a
Consolidated basis, of Consolidated Net Income for such period plus (a)
without duplication and to the extent deducted in determining such
Consolidated Net Income, the sum of (i) Consolidated Interest Expense for
such period, (ii) consolidated income tax expense for such period, (iii)
all amounts attributable to depreciation and amortization for such period
and (iv) all extraordinary losses for such period and minus (b) without
duplication and to the extent included in determining such Consolidated Net
Income, any extraordinary gains for such period determined in accordance
with GAAP for the most recently completed Measurement Period; provided,
however, that EBITDA shall exclude (i) non-cash charges not to exceed $26
million in the aggregate for the periods ending, June 30, 2003, September
30, 2003, December 31, 2003 and March 31, 2004, including, without
limitation, non-cash charges consisting of debt issuance costs, claims
adjustments and accounting changes and (ii) expenses incurred in connection
with the Grupo TFM Acquisition in an amount not to exceed $20 million.
"Effective Date" has the meaning specified in Section 3.01.
"Eligible Assignee" means with respect to any Facility (other than the
Letter of Credit Facility), (i) a Lender Party; (ii) an Affiliate of a
Lender Party; (iii) an Approved Fund; and (iv) any other Person (other than
an individual) approved by (x) the Administrative Agent, (y) in the case of
an assignment of a Revolving Credit Commitment, the Issuing Bank and (z)
unless a Default has occurred and is continuing, the Borrower (each such
approval not to be unreasonably withheld or delayed); provided, however,
that neither any Loan Party nor any Affiliate of a Loan Party shall qualify
as an Eligible Assignee under this definition.
"Environmental Action" means any action, suit, demand, demand letter,
claim, notice of non-compliance or violation, notice of liability or
potential liability,
investigation, proceeding, consent order or consent agreement relating
in any way to any Environmental Law, any Environmental Permit or Hazardous
Material or arising from alleged injury or threat to health, safety or the
environment, including, without limitation, (a) by any governmental or
regulatory authority for enforcement, cleanup, removal, response, remedial
or other actions or damages and (b) by any governmental or regulatory
authority or third party for damages, contribution, indemnification, cost
recovery, compensation or injunctive relief.
"Environmental Law" means any Federal, state, local or foreign
statute, law, ordinance, rule, regulation, code, order, writ, judgment,
injunction, decree or judicial or agency interpretation, policy or guidance
relating to pollution or protection of the environment, health, safety or
natural resources, including, without limitation, those relating to the
use, handling, transportation, treatment, storage, disposal, release or
discharge of Hazardous Materials.
"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation,
fines, penalties or indemnities), of Parent, the Borrower or any Subsidiary
directly or indirectly resulting from or based upon (a) violation of any
Environmental Law, (b) the generation, use, handling, transportation,
storage, treatment or disposal of any Hazardous Materials, (c) exposure to
any Hazardous Materials, (d) the release or threatened release of any
Hazardous Materials into the environment or (e) any contract, agreement or
other consensual arrangement pursuant to which liability is assumed or
imposed with respect to any of the foregoing.
"Environmental Permit" means any permit, approval, identification
number, license or other authorization required under any Environmental
Law.
"Equity Interests" means, with respect to any Person, shares of
capital stock of (or other ownership or profit interests in) such Person,
warrants, options or other rights for the purchase or other acquisition
from such Person of shares of capital stock of (or other ownership or
profit interests in) such Person, securities convertible into or
exchangeable for shares of capital stock of (or other ownership or profit
interests in) such Person or warrants, rights or options for the purchase
or other acquisition from such Person of such shares (or such other
interests), and other ownership or profit interests in such Person
(including, without limitation, partnership, member or trust interests
therein), whether voting or nonvoting, and whether or not such shares,
warrants, options, rights or other interests are authorized or otherwise
existing on any date of determination.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"ERISA Event" means (a) any Reportable Event; (b) the existence with
respect to any Plan of an "accumulated funding deficiency" (as defined in
Section 412 of the Internal Revenue Code or Section 302 of ERISA), whether
or not waived; (c) the filing pursuant to Section 412(d) of the Internal
Revenue Code or Section 303(d) of ERISA of
an application for a waiver of the minimum funding standard with
respect to any Plan; (d) the incurrence by Parent or any member of the
Controlled Group of any liability under Title IV of ERISA with respect to
the termination of any Plan; (e) the receipt by Parent or any member of the
Controlled Group from the PBGC or a plan administrator of any notice
relating to an intention to terminate any Plan or to appoint a trustee to
administer any Plan; (f) the incurrence by Parent or any member of the
Controlled Group of any liability with respect to the withdrawal or partial
withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by
Parent or any member of the Controlled Group of any notice, or the receipt
by any Multiemployer Plan from Parent or any member of the Controlled Group
of any notice, concerning the imposition of Withdrawal Liability or a
determination that a Multiemployer Plan is, or is expected to be, insolvent
or in reorganization, within the meaning of Title IV of ERISA.
"Escrow Bank" has the meaning specified in Section 2.15(c).
"Eurocurrency Liabilities" has the meaning specified in Regulation D
of the Board of Governors of the Federal Reserve System, as in effect from
time to time.
"Eurodollar Lending Office" means, with respect to any Lender Party,
the office of such Lender Party specified as its "Eurodollar Lending
Office" opposite its name on Schedule I hereto or in the Assignment and
Acceptance pursuant to which it became a Lender Party (or, if no such
office is specified, its Domestic Lending Office), or such other office of
such Lender Party as such Lender Party may from time to time specify to the
Borrower and the Administrative Agent.
"Eurodollar Rate" means, for any Interest Period, an interest rate per
annum equal to the rate per annum obtained by dividing (a) the rate per
annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing
on the page of the Telerate screen (or any successor page) that displays an
average British Bankers Association Interest Settlement Rate for deposits
in Dollars (for delivery on the first day of such Interest Period) with a
term equivalent to such Interest Period, determined as of approximately
11:00 A.M. (London time) two Business Days before the first day of such
Interest Period (provided that, if for any reason such rate does not appear
on such page or service or such page or service shall not be available, the
term "Eurodollar Rate" shall mean the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) equal to the rate determined by the
Administrative Agent to be the offered rate on such other page or other
service that displays an average British Bankers Association Interest
Settlement Rate for deposits in Dollars (for delivery on the first day of
such Interest Period) with a term equivalent to such Interest Period,
determined as of approximately 11:00 A.M. (London time) two Business Days
prior to the first day of such Interest Period) by (b) a percentage equal
to 100% minus the Eurodollar Rate Reserve Percentage for such Interest
Period.
"Eurodollar Rate Advance" means an Advance that bears interest as
provided in Section 2.07(a)(ii).
"Eurodollar Rate Reserve Percentage" for any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing means the
reserve percentage applicable two Business Days before the first day of
such Interest Period under regulations issued from time to time by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including, without limitation,
any emergency, supplemental or other marginal reserve requirement) for a
member bank of the Federal Reserve System in New York City with respect to
liabilities or assets consisting of or including Eurocurrency Liabilities
(or with respect to any other category of liabilities that includes
deposits by reference to which the interest rate on Eurodollar Rate
Advances is determined) having a term equal to such Interest Period.
"Events of Default" has the meaning specified in Section 6.01.
"Excess Cash Flow" means, for any Fiscal Year,
(a) EBITDA for such Fiscal Year; minus
(b) cash tax payments made by Parent and its Subsidiaries during such
Fiscal Year; minus
(c) Consolidated Interest Expense for such Fiscal Year; minus
(d) (i) cash Capital Expenditures for such Fiscal Year (except to the
extent attributable to the incurrence of Capitalized Lease Obligations or
otherwise financed by incurring long-term Debt) to the extent permitted
pursuant to Section 5.02(m) and (ii) capital contributions, loans and
guaranteed Debt and Sale and Leaseback Transactions made in cash during
such Fiscal Year, in each case permitted by Section 5.02(f)(viii); minus
(e) the aggregate principal amount of long-term Debt repaid or prepaid
by Parent and its Subsidiaries during such Fiscal Year, excluding (i) Debt
in respect of Revolving Credit Advances and Letters of Credit, (ii) Term B
Advances prepaid pursuant to Section 2.06(b)(ii) (other than any part of
such prepayment attributable to gains on asset sales that are included in
the calculation of Consolidated Net Income for such Fiscal Year), and (iii)
repayments or prepayments of long-term Debt financed by incurring other
long-term Debt or by issuing Equity Interests; minus
(f) the aggregate amount of Investments or other payments required to
be made by the Parent or any of its Subsidiaries during such Fiscal Year
pursuant to mandatory capital calls or similar agreements under joint
venture, limited liability company or shareholder agreements and actually
made in cash during such Fiscal Year.
"Excluded Taxes" means, with respect to the Administrative Agent or
any Lender Party, (a) income or franchise taxes imposed on (or measured by)
its net income by the United States of America, or by the jurisdiction
under the laws of which the Administrative Agent or such Lender Party, as
the case may be, is organized or in which the principal office of the
Administrative Agent or such Lender Party, as applicable, is
located or, in the case of any Lender Party, in which its Applicable
Lending Office is located, (b) any branch profits tax imposed by the United
States of America or any similar tax imposed by any other jurisdiction
described in clause (a) above, and (c) in the case of a Foreign Lender
Party, any withholding tax that (i) is in effect and would apply to amounts
payable to such Foreign Lender Party at the time such Foreign Lender Party
becomes a party to this Agreement (or designates a different Applicable
Lending Office), except to the extent that such Foreign Lender Party (or a
Lender Party assignor, if any) was entitled, at the time of designation of
a different Applicable Lending Office (or the effective date of the
Assignment and Acceptance pursuant to which such Foreign Lender Party
becomes a party to this Agreement), to receive additional amounts from a
Loan Party with respect to any withholding tax pursuant to Section 2.12(a),
or (ii) is attributable to such Foreign Lender Party's failure to comply
with Section 2.12(e) (other than if such failure is due to a change in law,
occurring after the date on which applicable documentation originally was
required to be provided).
"Existing Credit Facility" has the meaning specified in the
Preliminary Statements.
"Existing Debt" means Debt of each Loan Party and its Subsidiaries
outstanding immediately before the occurrence of the Effective Date.
"Extraordinary Receipt" means any cash received by or paid to or for
the account of any Person not in the ordinary course of business,
consisting of proceeds of property insurance, condemnation awards (and
payments in lieu thereof), indemnity payments and proceeds received in
connection with any taking under the power of eminent domain or similar
proceedings.
"Facility" means the Term B Facility, the Revolving Credit Facility,
the Swing Line Facility or the Letter of Credit Facility.
"Federal Funds Rate" means, for any period, a fluctuating interest
rate per annum equal for each day during such period to the weighted
average of the rates on overnight Federal funds transactions with members
of the Federal Reserve System arranged by Federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day that is a Business Day, the
average of the quotations for such day for such transactions received by
the Administrative Agent from three Federal funds brokers of recognized
standing selected by it.
"Fee Letters" means (i) the fee letter dated February 27, 2004 between
the Borrower and the Arrangers, as amended and (ii) the fee letter dated
February 27, 2004 between the Borrower and the Administrative Agent, as
amended.
"Fiscal Year" means a fiscal year of the Parent and its Consolidated
Subsidiaries ending on December 31 in any calendar year.
"Foreign Lender Party" means any Lender Party that is organized under
the laws of a jurisdiction other than the United States of America, any
State thereof or the District of Columbia.
"Foreign Subsidiary" means any Subsidiary that is organized under the
laws of a jurisdiction other than the United States of America, any State
thereof or the District of Columbia.
"Fund" means any Person (other than an individual) that is or will be
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its
business.
"GAAP" has the meaning specified in Section 1.03.
"Governmental Authority" means any nation or government, any state,
province, city, municipal entity or other political subdivision thereof,
and any governmental, executive, legislative, judicial, administrative or
regulatory agency, department, authority, instrumentality, commission,
board, bureau or similar body, whether federal, state, provincial,
territorial, local or foreign.
"Governmental Authorization" means any authorization, approval,
consent, franchise, license, covenant, order, ruling, permit,
certification, exemption, notice, declaration or similar right, undertaking
or other action of, to or by, or any filing, qualification or registration
with, any Governmental Authority.
"Grupo Parent" means a wholly owned direct or indirect subsidiary of
Parent that is not a Foreign Subsidiary and that will at all times after
the completion of the Grupo TFM Acquisition, individually or together with
another direct or indirect wholly owned subsidiary of Parent, be the record
and beneficial owner of all Equity Interests in Grupo TFM owned directly or
indirectly by Parent (except that up to 25% of the Equity Interests in
Grupo TFM may be owned by TFM, S.A. de C.V., so long as Grupo TFM owns at
least 80% of the issued and outstanding Equity Interests in TFM, S.A. de
C.V.).
"Grupo TFM Acquisition" means the acquisition by Parent, directly or
indirectly, from Grupo TMM of all the Equity Interests owned, directly or
indirectly, by Grupo TMM in Grupo TFM pursuant to a transaction or series
of transactions that result in Grupo Parent or another wholly owned
subsidiary of Parent owning directly or indirectly all such Equity
Interests.
"Grupo TFM" means Grupo Transportacion Ferroviaria Mexicana, S.A. de
C.V., a Mexican corporation.
"Grupo TFM Investment" means, in connection with the Mexican Put
Option Financing, the purchase, or any capital contribution made to Grupo
TFM, TFM, S.A. de C.V. or both to fund the purchase (alone or together with
other direct or indirect shareholders of Grupo TFM) by Parent (or a
Subsidiary on behalf of Parent) from the Federal government of Mexico or
any other Mexican governmental entity or quasi-
governmental entity, pursuant to an option held by such government, of
an additional interest of approximately 20% in TFM, S.A. de C.V.
"Grupo TMM" means Grupo TMM, S.A., a Mexican corporation.
"Guaranteed Obligations" has the meaning specified in Section 8.01.
"Guaranties" means the Parent Guaranty and the Subsidiary Guaranty.
"Guarantors" means the Parent and the Subsidiary Guarantors.
"Guaranty Supplement" has the meaning specified in Section 8.05.
"Hazardous Materials" means (a) petroleum or petroleum products,
by-products or breakdown products, radioactive materials,
asbestos-containing materials, polychlorinated biphenyls and radon gas and
(b) any other chemicals, materials or substances designated, classified or
regulated as hazardous or toxic or as a pollutant or contaminant under any
Environmental Law.
"Hedge Agreements" means interest rate swap, cap or collar agreements,
interest rate future or option contracts, currency swap agreements,
currency future or option contracts, commodity price hedging agreements and
arrangements and other hedging agreements.
"Hedge Bank" means any Lender Party or an Affiliate of a Lender Party
in its capacity as a party to a Secured Hedge Agreement.
"Indemnified Party" has the meaning specified in Section 9.04(b).
"Indemnified Taxes" means Taxes other than Excluded Taxes.
"Information Memorandum" means the information memorandum dated
March 2004 used by the Arrangers in connection with the syndication of the
Commitments.
"Initial Extension of Credit" means the earlier to occur of the
initial Borrowing and the initial issuance of a Letter of Credit hereunder.
"Initial Issuing Bank" means the bank listed on the signature pages
hereof as the Initial Issuing Bank.
"Initial Lender Parties" means the Initial Issuing Bank, the Initial
Lenders and the Initial Swing Line Bank.
"Initial Lenders" means the banks, financial institutions and other
institutional lenders listed on the signature pages hereof as the Initial
Lenders.
"Initial Swing Line Bank" means the bank listed on the signature pages
hereof as the Initial Swing Line Bank.
"Intercompany Loan Repayment" has the meaning specified in Section
2.14.
"Interest Coverage Ratio" means, at any date of determination, the
ratio of (a) EBITDA to (b) Consolidated Interest Expense, in each case, for
the most recently completed Measurement Period.
"Interest Period" means, for each Eurodollar Rate Advance comprising
part of the same Borrowing, the period commencing on the date of such
Eurodollar Rate Advance or the date of the Conversion of any Base Rate
Advance into such Eurodollar Rate Advance, and ending on the last day of
the period selected by the Borrower pursuant to the provisions below and,
thereafter, each subsequent period commencing on the last day of the
immediately preceding Interest Period and ending on the last day of the
period selected by the Borrower pursuant to the provisions below. The
duration of each such Interest Period shall be one, two, three or six
months, as the Borrower may, upon notice received by the Administrative
Agent not later than 11:00 A.M. (New York City time) on the third Business
Day prior to the first day of such Interest Period, select (or such other
periods as the Borrower may select and may be available and acceptable to
the Lenders); provided, however, that:
(a) the Borrower may not select any Interest Period with respect to
any Eurodollar Rate Advance under a Facility that ends after any principal
repayment installment date for such Facility unless, after giving effect to
such selection, the aggregate principal amount of Base Rate Advances and of
Eurodollar Rate Advances having Interest Periods that end on or prior to
such principal repayment installment date for such Facility shall be at
least equal to the aggregate principal amount of Advances under such
Facility due and payable on or prior to such date;
(b) whenever the last day of any Interest Period would otherwise occur
on a day other than a Business Day, the last day of such Interest Period
shall be extended to occur on the next succeeding Business Day, provided,
however, that, if such extension would cause the last day of such Interest
Period to occur in the next following calendar month, the last day of such
Interest Period shall occur on the next preceding Business Day; and
(c) whenever the first day of any Interest Period occurs on a day of
an initial calendar month for which there is no numerically corresponding
day in the calendar month that succeeds such initial calendar month by the
number of months equal to the number of months in such Interest Period,
such Interest Period shall end on the last Business Day of such succeeding
calendar month.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"Interstate Commerce Act" means the Interstate Commerce Commission
Termination Act of 1995, and the regulations promulgated thereunder.
"Inventory" means all Inventory referred to in Section 1(b) of the
Security Agreement.
"Investment" in any Person means any loan or advance to such Person,
any purchase or other acquisition of any Equity Interests or Debt or the
assets comprising a division or business unit or a substantial part or all
of the business of such Person, any capital contribution to such Person or
any other direct or indirect investment in such Person, including, without
limitation, any acquisition by way of a merger or consolidation (or similar
transaction) and any arrangement pursuant to which the investor incurs any
Contingent Obligation in respect of such person or Debt of the types
referred to in clause (h) of the definition of "Debt" in respect of such
Person.
"Issuing Bank" means the Initial Issuing Bank and any Eligible
Assignee to which the Letter of Credit Commitment hereunder has been
assigned pursuant to Section 9.07 so long as such Eligible Assignee
expressly agrees to perform in accordance with their terms all of the
obligations that by the terms of this Agreement are required to be
performed by it as an Issuing Bank and notifies the Administrative Agent of
its Applicable Lending Office and the amount of its Letter of Credit
Commitment (which information shall be recorded by the Administrative Agent
in the Register), for so long as such Initial Issuing Bank or Eligible
Assignee, as the case may be, shall have a Letter of Credit Commitment.
"L/C Collateral Account" has the meaning specified in the Security
Agreement.
"L/C Disbursement" shall mean a payment or disbursement made by the
Issuing Bank pursuant to a Letter of Credit.
"L/C Related Documents" has the meaning specified in
Section 2.04(d)(ii).
"Lender Party" means any Lender, the Issuing Bank or the Swing Line
Bank.
"Lenders" means the Initial Lenders and each Person that shall become
a Lender hereunder pursuant to Section 9.07 for so long as such Initial
Lender or Person, as the case may be, shall be a party to this Agreement.
"Letter of Credit Advance" means an advance made by the Issuing Bank
or any Revolving Credit Lender pursuant to Section 2.03(c).
"Letter of Credit Agreement" has the meaning specified in
Section 2.03(a).
"Letter of Credit Commitment" means, with respect to the Issuing Bank
at any time, the amount set forth opposite the Issuing Bank's name on
Schedule I hereto under the caption "Letter of Credit Commitment" or, if
the Issuing Bank has entered into an Assignment and Acceptance, set forth
for the Issuing Bank in the Register maintained by the Administrative Agent
pursuant to Section 9.07(d) as the Issuing Bank's "Letter of Credit
Commitment", as such amount may be reduced at or prior to such time
pursuant to Section 2.05.
"Letter of Credit Facility" means, at any time, an amount equal to the
amount of the Issuing Bank's Letter of Credit Commitment at such time, as
such amount may be reduced at or prior to such time pursuant to Section
2.05.
"Letters of Credit" has the meaning specified in Section 2.01(d).
"Leverage Ratio" means, at any date of determination, the ratio of (a)
the aggregate amount of Debt for Borrowed Money at such date to (b) EBITDA
at such date determined in accordance with GAAP for the most recently
completed Measurement Period.
"Lien" means any lien, security interest or other charge or
encumbrance of any kind, including, without limitation, the lien or
retained security title of a conditional vendor.
"Loan Documents" means (i) this Agreement, (ii) the Notes, (iii) the
Guaranties, (iv) the Collateral Documents, (v) the Fee Letters, (vi) each
Letter of Credit Agreement, and (vii ) each Secured Hedge Agreement, in
each case as amended.
"Loan Parties" means the Parent, the Borrower and the Subsidiary
Guarantors.
"Margin Stock" has the meaning specified in Regulation U.
"Material Adverse Change" means any material adverse change in the
business, condition (financial or otherwise), operations, performance,
properties or prospects of the Parent and its Subsidiaries, taken as a
whole.
"Material Adverse Effect" means a material adverse effect on (a) the
business, condition (financial or otherwise), operations, performance,
properties or prospects of the Parent and its Subsidiaries, taken as a
whole, (b) the rights and remedies of any Agent or any Lender Party under
any Loan Document or (c) the ability of any Loan Party to perform its
Obligations under any Loan Document to which it is or is to be a party.
"Material Debt" means Debt (other than the Obligations hereunder), or
obligations in respect of any Hedge Agreement of the Parent or its
Subsidiaries in an aggregate principal amount exceeding $20,000,000. For
purposes of determining Material Debt, the "principal amount" of the
obligations of Parent or any Subsidiary in respect of any Hedging Agreement
at any time shall be the maximum aggregate amount (giving effect to any
netting agreements) that Parent or such Subsidiary would be required to pay
if such Hedging Agreement were terminated at such time.
"Material Debt Document" means any indenture or other agreement or
instrument governing or evidencing Material Debt.
"Measurement Period" means, at any date of determination, the most
recently completed four consecutive fiscal quarters of the Parent ending on
or prior to such date or, if less than four consecutive fiscal quarters of
the Parent have been completed since the date of the Initial Extension of
Credit, the fiscal quarters of the Parent that have been completed since
the date of the Initial Extension of Credit; provided that, (a) for
purposes of determining an amount of any item included in the calculation
of Consolidated Interest Expense for the fiscal quarter ended March 31,
2004, such amount for the Measurement Period then ended shall equal such
item for such fiscal quarter multiplied by four; (b) for
purposes of determining an amount of any item included in the calculation
of Consolidated Interest Expense for the fiscal quarter ended June 30,
2004, such amount for the Measurement Period then ended shall equal such
item for the two fiscal quarters then ended multiplied by two; and (c) for
purposes of determining an amount of any item included in the calculation
of Consolidated Interest Expense for the fiscal quarter ended September 30,
2004, such amount for the Measurement Period then ended shall equal such
item for the three fiscal quarters then ended multiplied by 4/3.
"Mexican Put Option Financing" has the meaning specified in Section
2.14.
"Mexrail" means Mexrail, Inc., a Delaware corporation.
"Mexrail Acquisition" means the acquisition by the Parent, directly or
indirectly, of all of the Equity Interests in Mexrail for consideration in
an aggregate principal amount of approximately $80,000,000.
"Moody's" means Moody's Investors Service, Inc.
"Morgan Stanley" has the meaning set forth in the recital of parties
to this agreement.
"Mortgage Policies" has the meaning specified in Section 5.01(n)(B).
"Mortgages" has the meaning specified in Section 5.01(n).
"Multiemployer Plan" shall mean a Plan that is a "multiemployer plan"
as defined in Section 4001(a)(3) of ERISA as to which Parent or any member
of the Controlled Group may have any liability.
"Net Cash Proceeds" means, (a) with respect to any sale, lease,
transfer or other disposition (including pursuant to a Sale and Leaseback
Transaction or Securitization Transaction) of any assets of the Parent or
any of its Subsidiaries (other than any sale, lease, transfer or other
disposition of assets pursuant to clause (i) or (iii) of Section 5.02(e)
and transfers of accounts receivable in Securitization Transactions to the
extent the aggregate amount of all such transactions after the date of this
Agreement shall not exceed $25,000,000) and with respect to Extraordinary
Receipts, the excess, if any, of (i) the sum of cash and Cash Equivalents
received in connection with such sale, lease, transfer or other disposition
or Extraordinary Receipt (including any cash or Cash Equivalents received
by way of deferred payment pursuant to, or by monetization of, a note
receivable or otherwise, but only as and when so received) over (ii) the
sum of (A) the principal amount of any Debt (other than Debt under the Loan
Documents) that is secured by such asset and that is required to be repaid
in connection with such sale, lease, transfer or other disposition thereof
or otherwise subject to mandatory prepayment as a result of such event, (B)
the reasonable and customary out-of-pocket costs, fees, commissions,
premiums and expenses incurred by the Parent or its Subsidiaries, (C)
federal, state, provincial, foreign and local taxes reasonably estimated
(on a Consolidated basis) to be actually payable within the current or the
immediately succeeding tax year as a result of any gain recognized in
connection therewith and (D) the amount of any
reserves established by the Parent or any of its Subsidiaries to fund
contingent liabilities reasonably estimated to be payable during the year
in which such event occurred or the next succeeding year and that are
directly attributable to such event; provided, however, that Net Cash
Proceeds shall not include any such amounts to the extent such amounts are
reinvested in the business of the Parent and its Subsidiaries within 360
days after the date of receipt thereof; provided, further that Net Cash
Proceeds under this clause (a) shall not include the first $15 million of
Net Cash Proceeds in any Fiscal Year; and
(b) with respect to the incurrence or issuance of any Debt by the
Parent or any of its Subsidiaries (other than Debt permitted pursuant to
Section 5.02(b)), the excess of (i) the sum of the cash and Cash
Equivalents received in connection with such incurrence or issuance over
(ii) the underwriting discounts and commissions or other similar payments,
and other out-of-pocket costs, fees, commissions, premiums and expenses
incurred by the Parent or any of its Subsidiaries in connection with such
incurrence or issuance to the extent such amounts were not deducted in
determining the amount referred to in clause (i).
"Note" means a Term B Note or a Revolving Credit Note.
"Notice of Borrowing" has the meaning specified in Section 2.02(a).
"Notice of Issuance" has the meaning specified in Section 2.03(a).
"Notice of Renewal" has the meaning specified in Section 2.01(e).
"Notice of Swing Line Borrowing" has the meaning specified in
Section 2.02(b).
"Notice of Termination" has the meaning specified in Section 2.01(e).
"NPL" means the National Priorities List under CERCLA.
"Obligation" means, with respect to any Person, any payment,
performance or other obligation of such Person of any kind, including,
without limitation, any liability of such Person on any claim, whether or
not the right of any creditor to payment in respect of such claim is
reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
disputed, undisputed, legal, equitable, secured or unsecured, and whether
or not such claim is discharged, stayed or otherwise affected by any
proceeding referred to in Section 6.01(f). Without limiting the generality
of the foregoing, the Obligations of any Loan Party under the Loan
Documents include (a) the obligation to pay principal, interest, Letter of
Credit commissions, charges, expenses, fees, attorneys' fees and
disbursements, indemnities and other amounts payable by such Loan Party
under any Loan Document and (b) the obligation of such Loan Party to
reimburse any amount in respect of any of the foregoing that any Lender
Party, in its sole discretion, may elect to pay or advance on behalf of
such Loan Party.
"OECD" means the Organization for Economic Cooperation and
Development.
"Off Balance Sheet Obligation" means, with respect to any Person, any
Obligation of such Person under a synthetic lease, tax retention operating
lease, off-balance sheet loan or similar off-balance sheet financing
classified as an operating lease in accordance with GAAP, if such
Obligations would give rise to a claim against such Person in a proceeding
referred to in Section 6.01(f); provided, that "Off Balance Sheet
Obligations" shall not include Obligations incurred to finance property and
equipment in the ordinary course of business.
"Other Taxes" means any and all present or future recording, stamp,
documentary, excise, transfer, sales, property, or similar taxes, charges
or levies arising from any payment made hereunder or under the Notes or
under any other Loan Document or from the execution, delivery, registration
or enforcement of, or otherwise with respect to, this Agreement, the Notes
or any other Loan Document.
"Parent" has the meaning specified in the recital of parties to this
Agreement.
"Parent Guaranty" means the guaranty of the Parent set forth in
Article VIII.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA and any successor entity performing similar functions.
"Permitted Encumbrances" has the meaning specified in the Mortgages.
"Permitted Liens" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding shall
have been commenced: (a) Liens for taxes, assessments and governmental
charges or levies to the extent not required to be paid under
Section 5.01(b); (b) Liens imposed by law, such as materialmen's,
mechanics', carriers', workmen's and repairmen's Liens and other similar
Liens arising in the ordinary course of business securing obligations that
(i) are not overdue for a period of more than 90 days or which are being
contested in good faith by appropriate proceedings and (ii) individually or
together with all other Permitted Liens outstanding on any date of
determination do not materially adversely affect the use of the property to
which they relate; (c) pledges or deposits in the ordinary course of
business to secure obligations under workers' compensation laws or similar
legislation or to secure public or statutory obligations; (d) deposits to
secure the performance of bids, trade contracts and leases (other than
Debt), statutory obligations, surety bonds (other than bonds related to
judgments or litigation), performance bonds and other obligations of a like
nature incurred in the ordinary course of business; (e) Liens securing
judgments (or the payment of money not constituting a Default under Section
6.01(g)) or securing appeal or other surety bonds related to such
judgments, and (f) Permitted Encumbrances.
"Person" means an individual, partnership, corporation (including a
business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture or other entity, or a government
or any political subdivision or agency thereof.
"Plan" means any employee pension benefit plan that is covered by
Title IV of ERISA or subject to the minimum funding standards under Section
412 of the Internal
Revenue Code as to which Parent or any member of the Controlled Group may
have any liability.
"Pledged Shares" has the meaning specified in the Security Agreement.
"Post Petition Interest" has the meaning specified in Section 8.06.
"Preferred Interests" means, with respect to any Person, Equity
Interests issued by such Person that are entitled to a preference or
priority over any other Equity Interests issued by such Person upon any
distribution of such Person's property and assets, whether by dividend or
upon liquidation.
"Prepayment Date" means with respect to any cash receipts from a
transaction described in clause (a) or (b) of the definition of "Net Cash
Proceeds", the third Business Day following the date of the receipt of such
Net Cash Proceeds by the Parent or any of its Subsidiaries or, if any cash
receipts from a transaction described in clause (a) of the definition of
"Net Cash Proceeds" are not deemed to be Net Cash Proceeds pursuant to the
second to the last proviso of such clause and are not reinvested in the
business of the Borrower and its Subsidiaries within 360 days after the
date of receipt thereof, the date which is 360 days following the date of
receipt of such cash receipts.
"Properties" shall mean all Rights of Way (as defined in each of the
Mortgages) and those real estate assets listed on Schedules 4.01(v) and
4.01(w)(ii).
"Pro Rata Share" of any amount means, with respect to any Revolving
Credit Lender at any time, the product of such amount times a fraction the
numerator of which is the amount of such Lender's Revolving Credit
Commitment at such time (or, if the Revolving Credit Commitments shall have
been terminated pursuant to Section 2.05 or 6.01, such Lender's Revolving
Credit Commitment as in effect immediately prior to such termination) and
the denominator of which is the Revolving Credit Facility at such time (or,
if the Revolving Credit Commitments shall have been terminated pursuant to
Section 2.05 or 6.01, the Revolving Credit Facility as in effect
immediately prior to such termination).
"Railway Labor Act" means Railway Labor Act, as amended from time to
time.
"Refinancing" has the meaning specified in the Preliminary Statements.
"Register" has the meaning specified in Section 9.07(d).
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"Reportable Event" shall mean any reportable event as defined in
Section 4043 of ERISA and the regulations issued under such Section with
respect to a Plan (other than a Multiemployer Plan), excluding, however,
such events as to which the PBGC by regulation or by technical update
waived the requirement of Section 4043(a) of ERISA that it be notified
within 30 days of the occurrence of such event; provided that a failure
to meet the minimum funding standard of Section 412 of the Internal Revenue
Code and of Section 302 of ERISA shall be a reportable event regardless of
the issuance of any waiver in accordance with Section 412(d) of the
Internal Revenue Code or Section 303(d) of ERISA.
"Required Lenders" means, at any time, Lenders owed or holding at
least a majority in interest of the sum of (a) the aggregate principal
amount of the Advances outstanding at such time, (b) the aggregate
Available Amount of all Letters of Credit outstanding at such time, and (c)
the aggregate Unused Revolving Credit Commitments at such time; provided,
however, that if any Lender shall be a Defaulting Lender at such time,
there shall be excluded from the determination of Required Lenders at such
time (A) the aggregate principal amount of the Advances owing to such
Lender (in its capacity as a Lender) and outstanding at such time, (B) such
Lender's Pro Rata Share of the aggregate Available Amount of all Letters of
Credit outstanding at such time, and (C) the Unused Revolving Credit
Commitment of such Lender at such time. For purposes of this definition,
the aggregate principal amount of Swing Line Advances owing to the Swing
Line Bank and of Letter of Credit Advances owing to the Issuing Bank and
the Available Amount of each Letter of Credit shall be considered to be
owed to the Revolving Credit Lenders ratably in accordance with their
respective Revolving Credit Commitments.
"Revolving Credit Advance" has the meaning specified in
Section 2.01(b).
"Revolving Credit Borrowing" means a borrowing consisting of
simultaneous Revolving Credit Advances of the same Type made by the
Revolving Credit Lenders.
"Revolving Credit Commitment" means, with respect to any Revolving
Credit Lender at any time, the amount set forth opposite such Lender's name
on Schedule I hereto under the caption "Revolving Credit Commitment" or, if
such Lender has entered into one or more Assignment and Acceptances, set
forth for such Lender in the Register maintained by the Administrative
Agent pursuant to Section 9.07(d) as such Lender's "Revolving Credit
Commitment", as such amount may be reduced at or prior to such time
pursuant to Section 2.05.
"Revolving Credit Facility" means, at any time, the aggregate amount
of the Revolving Credit Lenders' Revolving Credit Commitments at such time.
"Revolving Credit Lender" means any Lender that has a Revolving Credit
Commitment.
"Revolving Credit Note" means a promissory note of the Borrower
payable to the order of any Revolving Credit Lender, in substantially the
form of Exhibit A-1 hereto, evidencing the aggregate indebtedness of the
Borrower to such Lender resulting from the Revolving Credit Advances,
Letter of Credit Advances and Swing Line Advances made by such Lender, as
amended.
"Sale and Leaseback Transaction" means any arrangement, directly or
indirectly, whereby any Person shall sell or transfer any property, real or
personal, used or useful in its business, whether now owned or hereafter
acquired, and thereafter rent or
lease such property or other property which it intends to use for
substantially the same purpose or purposes as the property being sold or
transferred.
"Secured Hedge Agreement" means any Hedge Agreement required or
permitted under Article V that is entered into by and between the Borrower
and any Hedge Bank.
"Secured Obligations" has the meaning specified in Section 2 of the
Security Agreement.
"Secured Parties" means the Agents, the Lender Parties and the Hedge
Banks.
"Securitization Transaction" means any transfer by the Borrower or any
Subsidiary of accounts receivable or interests therein (a) to a trust,
partnership, corporation or other entity, which transfer is funded in whole
or in part, directly or indirectly, by the incurrence or issuance by the
transferee or any successor transferee of Debt or other securities that are
to receive payments from, or that represent interests in, the cash flow
derived from such accounts receivable or interests, or (b) directly to one
or more investors or other purchasers. The amount of any Securitization
Transaction shall be deemed at any time to be the aggregate principal or
stated amount of the Debt or other securities referred to in the preceding
sentence or, if there shall be no such principal or stated amount, the
uncollected amount of the accounts receivable transferred pursuant to such
Securitization Transaction net of any such accounts receivable that have
been written off as uncollectible.
"Security Agreement" has the meaning specified in Section 3.01(a)(ii).
"Senior Secured Debt" means any Debt that is pari passu with the Debt
under the Loan Documents and secured on a first priority basis.
"Significant Subsidiary" means any Subsidiary which is not a Foreign
Subsidiary the Consolidated revenues of which for the most recent Fiscal
Year for which audited financial statements have been delivered pursuant to
Section 5.03 were greater than 5% of Parent's Consolidated revenues for
such Fiscal Year or the Consolidated tangible assets of which as of the end
of such Fiscal Year were greater than 5% of Parent's Consolidated tangible
assets as of such date.
"Solvent" and "Solvency" mean, with respect to any Person on a
particular date, that on such date (a) the fair value of the property of
such Person is greater than the total amount of liabilities, including,
without limitation, contingent liabilities, of such Person, (b) the present
fair salable value of the assets of such Person is not less than the amount
that will be required to pay the probable liability of such Person on its
debts as they become absolute and matured, (c) such Person does not intend
to, and does not believe that it will, incur debts or liabilities beyond
such Person's ability to pay such debts and liabilities as they mature and
(d) such Person is not engaged in business or a transaction, and is not
about to engage in business or a transaction, for which such Person's
property would constitute an unreasonably small capital. The amount of
contingent liabilities at any time shall be computed as the amount that, in
the light of all the facts and
circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.
"Standby Letter of Credit" means any Letter of Credit issued under the
Letter of Credit Facility, other than a Trade Letter of Credit.
"S&P" means Standard & Poor's, a division of The McGraw-Hill
Companies, Inc.
"STB" shall mean the Surface Transportation Board, a board established
within the Department of Transportation, or any successor Federal agency
charged with similar regulation of common carriers.
"Subordinated Debt" means any Debt of any Loan Party that is
subordinated to the Obligations of such Loan Party under the Loan Documents
on, and that otherwise contains, terms and conditions satisfactory to the
Required Lenders.
"Subordinated Debt Documents" means all agreements, indentures and
instruments pursuant to which Subordinated Debt is issued, in each case as
amended, to the extent permitted under the Loan Documents.
"Subordinated Obligations" has the meaning specified in Section 8.06.
"Subsidiary" of any Person means any corporation, partnership, joint
venture, limited liability company, trust or estate of which (or in which)
more than 50% of (a) the issued and outstanding capital stock having
ordinary voting power to elect a majority of the Board of Directors of such
corporation (irrespective of whether at the time capital stock of any other
class or classes of such corporation shall or might have voting power upon
the occurrence of any contingency), (b) the interest in the capital or
profits of such partnership, joint venture or limited liability company or
(c) the beneficial interest in such trust or estate is at the time directly
or indirectly owned or controlled by such Person, by such Person and one or
more of its other Subsidiaries or by one or more of such Person's other
Subsidiaries. References in this Agreement or any Loan Document to any
"Subsidiary" or "Subsidiaries" of the Borrower and/or the Parent shall not
under any circumstances include Mexrail, Caymex, any domestic wholly owned
subsidiary of Parent which directly or indirectly owns the Equity Interests
of Grupo TFM or Panama Canal Railway Company and any of their respective
subsidiaries.
"Subsidiary Guarantors" means the Subsidiaries of the Borrower listed
on Schedule II hereto and each other Subsidiary of the Borrower that shall
be required to execute and deliver a guaranty pursuant to Section 5.01(i).
"Subsidiary Guaranty" means the guaranty of the Subsidiary Guarantors
set forth in Article VIII together with each other guaranty and guaranty
supplement delivered pursuant to Section 5.01(i), in each case as amended,
amended and restated, modified or otherwise supplemented.
"Supplemental Collateral Agent" has the meaning specified in Section
7.01(c).
"Surviving Debt" means Debt of each Loan Party and its Subsidiaries
outstanding immediately before and after giving effect to the Initial
Extension of Credit.
"Swing Line Advance" means an advance made by (a) the Swing Line Bank
pursuant to Section 2.01(c) or (b) any Revolving Credit Lender pursuant to
Section 2.02(b).
"Swing Line Bank" means the Initial Swing Line Bank and any Eligible
Assignee to which the Swing Line Commitment hereunder has been assigned
pursuant to Section 9.07 so long as such Eligible Assignee expressly agrees
to perform in accordance with their terms all obligations that by the terms
of this Agreement are required to be performed by it as a Swing Line Bank
and notifies the Administrative Agent of its Applicable Lending Office and
the amount of its Swing Line Commitment (which information shall be
recorded by the Administrative Agent in the Register), for so long as such
Initial Swing Line Bank or Eligible Assignee, as the case may be, shall
have a Swing Line Commitment.
"Swing Line Borrowing" means a borrowing consisting of a Swing Line
Advance made by the Swing Line Bank pursuant to Section 2.01(c) or the
Revolving Credit Lenders pursuant to Section 2.02(b).
"Swing Line Commitment" means, with respect to the Swing Line Bank at
any time, the amount set forth opposite the Swing Line Bank's name on
Schedule I hereto under the caption "Swing Line Commitment" or, if the
Swing Line Bank has entered into an Assignment and Acceptances, set forth
for the Swing Line Bank in the Register maintained by the Administrative
Agent pursuant to Section 9.07(d) as the Swing Line Bank's "Swing Line
Commitment", as such amount may be reduced at or prior to such time
pursuant to Section 2.05.
"Swing Line Facility" means, at any time, an amount equal to the
amount of the Swing Line Bank's Swing Line Commitments at such time, as
such amount may be reduced at or prior to such time pursuant to Section
2.05.
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings, and all liabilities with
respect thereto, imposed by any Governmental Authority.
"Term B Advance" has the meaning specified in Section 2.01(a).
"Term B Borrowing" means a borrowing consisting of simultaneous Term B
Advances of the same Type made by the Term B Lenders.
"Term B Commitment" means, with respect to any Term B Lender at any
time, the amount set forth opposite such Lender's name on Schedule I hereto
under the caption "Term B Commitment" or, if such Lender has entered into
one or more Assignment and Acceptances, set forth for such Lender in the
Register maintained by the Administrative Agent pursuant to Section 9.07(d)
as such Lender's "Term B Commitment", as such amount may be reduced at or
prior to such time pursuant to Section 2.05.
"Term B Facility" means, at any time, the aggregate amount of the Term
B Lenders' Term B Commitments at such time.
"Term B Lender" means any Lender that has a Term B Commitment or holds
a Term B Advance.
"Term B Note" means a promissory note of the Borrower payable to the
order of any Term B Lender, in substantially the form of Exhibit A-2
hereto, evidencing the indebtedness of the Borrower to such Lender
resulting from the Term B Advance made by such Lender, as amended.
"Termination Date" means the earlier of (a) the date of termination in
whole of the Revolving Credit Commitments, the Letter of Credit Commitment,
the Swing Line Commitment, the Term B Commitments pursuant to Section 2.05
or 6.01 and (b) (i) for purposes of the Revolving Credit Facility, the
Swing Line Facility and the Letter of Credit Facility, March 30, 2007,
(ii) for purposes of the Term B Facility and for all other purposes, March
30, 2008.
"Trade Letter of Credit" means any Letter of Credit that is issued
under the Letter of Credit Facility for the benefit of a supplier of
Inventory to the Borrower or any of its Subsidiaries to effect payment for
such Inventory or otherwise issued in the ordinary course of business, the
conditions to drawing under which include the presentation to the Issuing
Bank of negotiable bills of lading, invoices and related documents
sufficient, in the judgment of the Issuing Bank, to create a valid and
perfected lien on or security interest in such Inventory, bills of lading,
invoices and related documents in favor of the Issuing Bank.
"Transaction" means the Refinancing and the other transactions
contemplated by the Loan Documents.
"2002 Senior Notes" means the unsecured 7-1/2% senior notes of the
Borrower due June 15, 2009 in an aggregate principal amount of $200,000,000
issued pursuant to the 2002 Senior Notes Indenture.
"2002 Senior Notes Indenture" means the Indenture dated as of June 12,
2002 between the Borrower and US Bank National Association as trustee, as
amended to the extent permitted under the Loan Documents.
"Type" refers to the distinction between Advances bearing interest at
the Base Rate and Advances bearing interest at the Eurodollar Rate.
"Unused Revolving Credit Commitment" means, with respect to any
Revolving Credit Lender at any time, (a) such Lender's Revolving Credit
Commitment at such time minus (b) the sum of (i) the aggregate principal
amount of all Revolving Credit Advances, Swing Line Advances and Letter of
Credit Advances made by such Lender (in its capacity as a Lender) and
outstanding at such time plus (ii) such Lender's Pro Rata Share of (A) the
aggregate Available Amount of all Letters of Credit outstanding at such
time, (B) the aggregate principal amount of all Letter of Credit Advances
made by the
Issuing Bank pursuant to Section 2.03(c) and outstanding at such time
and (C) the aggregate principal amount of all Swing Line Advances made by
the Swing Line Bank pursuant to Section 2.01(c) and outstanding at such
time.
"Voting Interests" means shares of capital stock issued by a
corporation, or equivalent Equity Interests in any other Person, the
holders of which are ordinarily, in the absence of contingencies, entitled
to vote for the election of directors (or persons performing similar
functions) of such Person, even if the right so to vote has been suspended
by the happening of such a contingency.
"Welfare Plan" means a welfare plan, as defined in Section 3(1) of
ERISA, that is maintained for employees of any Loan Party or in respect of
which any Loan Party could have liability.
"Withdrawal Liability" means liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as
such terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Computation of Time Periods; Other Definitional
Provisions. In this Agreement and the other Loan Documents in the
computation of periods of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and
"until" each mean "to but excluding". References in the Loan Documents to
any agreement or contract "as amended" shall mean and be a reference to
such agreement or contract as amended, amended and restated, supplemented
or otherwise modified from time to time in accordance with its terms.
SECTION 1.03. Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with generally accepted
accounting principles consistent with those applied in the preparation of
the financial statements referred to in Section 4.01(g) ("GAAP").
SECTION 1.04. Currency Equivalents Generally. Any amount specified in
this Agreement (other than in Articles II, VII and IX) or any of the other
Loan Documents to be in U.S. dollars shall also include the equivalent of
such amount in any currency other than U.S. dollars, such equivalent amount
to be determined at the rate of exchange quoted by BNS in New York, New
York at the close of business on the Business Day immediately preceding any
date of determination thereof, to prime banks in New York, New York for the
spot purchase in the New York foreign exchange market of such amount in
U.S. dollars with such other currency.
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
AND THE LETTERS OF CREDIT
SECTION 2.01. The Advances and the Letters of Credit. (a) The Term B
Advances. Each Term B Lender severally agrees, on the terms and conditions
hereinafter set forth, to make a single advance (a "Term B Advance") to the
Borrower on the Effective Date in an amount not
to exceed such Lender's Term B Commitment. The Term B Borrowing shall
consist of Term B Advances made simultaneously by the Term B Lenders
ratably according to their Term B Commitments whereupon the Term B
Commitments shall be reduced to zero in accordance with Section 2.05(b).
Amounts borrowed under this Section 2.01(a) and repaid or prepaid may not
be reborrowed.
(b) The Revolving Credit Advances. Each Revolving Credit Lender
severally agrees, on the terms and conditions hereinafter set forth, to
make advances (each a "Revolving Credit Advance") to the Borrower from time
to time on any Business Day during the period from the Effective Date until
the Termination Date in respect of the Revolving Credit Facility in an
amount for each such Advance not to exceed such Lender's Unused Revolving
Credit Commitment at such time. Each Revolving Credit Borrowing shall be in
an aggregate amount of $5,000,000 or an integral multiple of $1,000,000 in
excess thereof (other than a Borrowing the proceeds of which shall be used
solely to repay or prepay in full outstanding Swing Line Advances or
outstanding Letter of Credit Advances or a Borrowing which corresponds to
an amortization payment) and shall consist of Revolving Credit Advances
made simultaneously by the Revolving Credit Lenders ratably according to
their Revolving Credit Commitments. Within the limits of each Revolving
Credit Lender's Unused Revolving Credit Commitment in effect from time to
time, the Borrower may borrow under this Section 2.01(b), prepay pursuant
to Section 2.06(a) and reborrow under this Section 2.01(b).
(c) The Swing Line Advances. The Swing Line Bank agrees on the terms
and conditions hereinafter set forth, to make Swing Line Advances to the
Borrower from time to time on any Business Day during the period from the
Effective Date until the Termination Date in respect of the Revolving
Credit Facility (i) in an aggregate amount not to exceed at any time
outstanding the Swing Line Bank's Swing Line Commitment at such time and
(ii) in an amount for each such Swing Line Borrowing not to exceed the
aggregate of the Unused Revolving Credit Commitments of the Revolving
Credit Lenders at such time. No Swing Line Advance shall be used for the
purpose of funding the payment of principal of any other Swing Line
Advance. Each Swing Line Borrowing shall be in an amount of $500,000 or an
integral multiple of $100,000 in excess thereof and shall be made as a Base
Rate Advance. Within the limits of the Swing Line Facility and within the
limits referred to in clause (ii) above, the Borrower may borrow under this
Section 2.01(c), repay pursuant to Section 2.04(c) or prepay pursuant to
Section 2.06(a) and reborrow under this Section 2.01(c). Immediately upon
the making of a Swing Line Advance, each Revolving Credit Lender shall be
deemed to, and hereby irrevocably and unconditionally agrees to, purchase
from the Swing Line Bank a risk participation in such Swing Line Advance in
an amount equal to the product of such Lender's Pro Rata Share times the
amount of such Swing Line Advance.
(d) The Letters of Credit. The Issuing Bank agrees, on the terms and
conditions hereinafter set forth, to issue (or cause its Affiliate that is
a commercial bank to issue on its behalf) letters of credit (the "Letters
of Credit") in U.S. dollars for the account of the Borrower from time to
time on any Business Day during the period from the Effective Date until 60
days before the Termination Date in respect of the Revolving Credit
Facility in an aggregate Available Amount (i) for all Letters of Credit not
to exceed at any time the lesser of (x) the Letter of Credit Facility at
such time and (y) the Issuing Bank's Letter of Credit Commitment at such
time and (ii) for each such Letter of Credit not to exceed the Unused
Revolving Credit
Commitments of the Revolving Credit Lenders at such time. No Letter of
Credit shall have an expiration date (including all rights of the Borrower
or the beneficiary to require renewal) later than the earlier of 60 days
before the Termination Date in respect of the Revolving Credit Facility and
(A) in the case of a Standby Letter of Credit, one year after the date of
issuance thereof, but may by its terms be renewable annually upon notice (a
"Notice of Renewal") given to the Issuing Bank and the Administrative Agent
on or prior to any date for notice of renewal set forth in such Letter of
Credit but in any event at least three Business Days prior to the date of
the proposed renewal of such Standby Letter of Credit and upon fulfillment
of the applicable conditions set forth in Article III unless the Issuing
Bank has notified the Borrower (with a copy to the Administrative Agent) on
or prior to the date for notice of termination set forth in such Letter of
Credit but in any event at least 30 Business Days prior to the date of
automatic renewal of its election not to renew such Standby Letter of
Credit (a "Notice of Termination") and (B) in the case of a Trade Letter of
Credit, 60 days after the date of issuance thereof; provided that the terms
of each Standby Letter of Credit that is automatically renewable annually
shall (x) require the Issuing Bank that issued such Standby Letter of
Credit to give the beneficiary named in such Standby Letter of Credit
notice of any Notice of Termination, (y) permit such beneficiary, upon
receipt of such notice, to draw under such Standby Letter of Credit prior
to the date such Standby Letter of Credit otherwise would have been
automatically renewed and (z) not permit the expiration date (after giving
effect to any renewal) of such Standby Letter of Credit in any event to be
extended to a date later than 60 days before the Termination Date in
respect of the Revolving Credit Facility. If either a Notice of Renewal is
not given by the Borrower or a Notice of Termination is given by the
Issuing Bank pursuant to the immediately preceding sentence, such Standby
Letter of Credit shall expire on the date on which it otherwise would have
been automatically renewed. Within the limits of the Letter of Credit
Facility, and subject to the limits referred to above, the Borrower may
request the issuance of Letters of Credit under this Section 2.01(d), repay
any Letter of Credit Advances resulting from drawings thereunder pursuant
to Section 2.04(d) and request the issuance of additional Letters of Credit
under this Section 2.01(d).
SECTION 2.02. Making the Advances. (a) Except as otherwise provided in
Section 2.02(b) or 2.03, each Borrowing shall be made on notice, given not
later than 11:00 A.M. (New York City time) on the third Business Day prior
to the date of the proposed Borrowing in the case of a Borrowing consisting
of Eurodollar Rate Advances, or not later than 10:00 A.M. (New York City
time) on the Business Day of the proposed Borrowing in the case of a
Borrowing consisting of Base Rate Advances, by the Borrower to the
Administrative Agent, which shall give to each Appropriate Lender prompt
notice thereof by telex or telecopier. Each such notice of a Borrowing (a
"Notice of Borrowing") shall be by telephone, confirmed immediately in
writing, or telex or telecopier, in substantially the form of Exhibit B
hereto, specifying therein the requested (i) date of such Borrowing,
(ii) Facility under which such Borrowing is to be made, (iii) Type of
Advances comprising such Borrowing, (iv) aggregate amount of such Borrowing
and (v) in the case of a Borrowing consisting of Eurodollar Rate Advances,
initial Interest Period for each such Advance. Each Appropriate Lender
shall, before 12:00 P.M. (New York City time) on the date of any Borrowing,
make available for the account of its Applicable Lending Office to the
Administrative Agent at the Administrative Agent's Account, in same day
funds, such Lender's ratable portion of such Borrowing in accordance with
the respective Commitments under the applicable Facility of such Lender and
the other Appropriate Lenders. After the Administrative Agent's receipt of
such funds and upon
fulfillment of the applicable conditions set forth in Article III, the
Administrative Agent will make such funds available to the Borrower by
crediting the Borrower's Account; provided, however, that, in the case of
any Revolving Credit Borrowing, the Administrative Agent shall first apply
such funds to prepay ratably the aggregate principal amount of any Swing
Line Advances and Letter of Credit Advances outstanding at such time,
together with interest accrued and unpaid thereon to and as of such date.
(b) (i) Each Swing Line Borrowing shall be made on notice, given
not later than 1:00 P.M. (New York City time) on the date of the
proposed Swing Line Borrowing, by the Borrower to the Swing Line Bank
and the Administrative Agent. Each such notice of a Swing Line
Borrowing (a "Notice of Swing Line Borrowing") shall be by telephone,
confirmed immediately in writing, or telex or telecopier, specifying
therein the requested (i) date of such Borrowing, (ii) amount of such
Borrowing and (iii) maturity of such Borrowing (which maturity shall
be no later than the tenth Business Day after the requested date of
such Borrowing). The Swing Line Bank will make the amount of the
requested Swing Line Advances available to the Administrative Agent at
the Administrative Agent's Account, in same day funds. After the
Administrative Agent's receipt of such funds and upon fulfillment of
the applicable conditions set forth in Article III, the Administrative
Agent will make such funds available to the Borrower by crediting the
Borrower's Account.
(ii) The Swing Line Bank may, at any time in its sole and absolute
discretion, request on behalf of the Borrower (and the Borrower hereby
irrevocably authorizes the Swing Line Bank to so request on its behalf)
that each Revolving Credit Lender make a Base Rate Advance in an amount
equal to such Lender's Pro Rata Share of the amount of Swing Line Advances
then outstanding. Such request shall be deemed to be a Notice of Borrowing
for purposes hereof and shall be made in accordance with the provisions of
Sections 2.01(b) and 2.02(a) without regard solely to the minimum amounts
specified therein but subject to the satisfaction of the conditions set
forth in Section 3.02. The Swing Line Bank shall furnish the Borrower with
a copy of the applicable Notice of Borrowing promptly after delivering such
notice to the Administrative Agent. Each Revolving Credit Lender shall make
an amount equal to its Pro Rata Share of the amount specified in such
Notice of Borrowing available for the account of its Applicable Lending
Office to the Administrative Agent for the account of the Swing Line Bank,
by deposit to the Administrative Agent's Account, in same date funds, not
later than 11:00 A.M. on the day specified in such Notice of Borrowing.
(iii) If for any reason any Swing Line Advance cannot be refinanced by
a Revolving Credit Borrowing as contemplated by Section 2.02(b)(ii), the
request for Base Rate Advances submitted by the applicable Swing Line Bank
as set forth in Section 2.02(b)(ii) shall be deemed to be a request by the
Swing Line Bank that each of the Revolving Credit Lenders fund its risk
participation in the relevant Swing Line Advance and each Revolving Credit
Lender's payment to the Administrative Agent for the account of the Swing
Line Bank pursuant to Section 2.02(b)(ii) shall be deemed payment in
respect of such participation.
(iv) If and to the extent that any Revolving Credit Lender shall not
have made the amount of its Pro Rata Share of such Swing Line Advance
available to the
Administrative Agent in accordance with the provisions of Section
2.02(b)(ii), such Revolving Credit Lender agrees to pay to the
Administrative Agent forthwith on demand such amount together with interest
thereon, for each day from the date of the applicable Notice of Borrowing
delivered by the Swing Line Bank until the date such amount is paid to the
Administrative Agent, at the Federal Funds Rate.
(v) Each Revolving Credit Lender's obligation to make Revolving Credit
Advances or to purchase and fund risk participations in Swing Line Advances
pursuant to this Section 2.02(b) shall be absolute and unconditional and
shall not be affected by any circumstance, including (A) any set-off,
counterclaim, recoupment, defense or other right which such Lender may have
against the Swing Line Bank, the Borrower or any other Person for any
reason whatsoever, (B) the occurrence of continuance of a Default, or (C)
any other occurrence, event or condition, whether or not similar to any of
the foregoing; provided, however, that each Revolving Credit Lender's
obligation to make Revolving Credit Advances pursuant to this Section
2.02(b) is subject to satisfaction of the conditions set forth in Section
3.02. No funding of risk participations shall relieve or otherwise impair
the obligation of the Borrower to repay Swing Line Advances, together with
interest as provided herein.
(c) Anything in subsection (a) above to the contrary notwithstanding,
(i) the Borrower may not select Eurodollar Rate Advances for any Borrowing
if the aggregate amount of such Borrowing is less than $1,000,000 (unless
such Borrowing corresponds to an amortization payment) or if the obligation
of the Appropriate Lenders to make Eurodollar Rate Advances shall then be
suspended pursuant to Section 2.09 or 2.10 and (ii) the Term B Advances may
not be outstanding as part of more than 10 separate Interest Periods and
the Revolving Credit Advances may not be outstanding as part of more than
15 separate Interest Periods.
(d) Each Notice of Borrowing and each Notice of Swing Line Borrowing
shall be irrevocable and binding on the Borrower. In the case of any
Borrowing that the related Notice of Borrowing specifies is to be comprised
of Eurodollar Rate Advances, the Borrower shall indemnify each Appropriate
Lender against any loss, cost or expense incurred by such Lender as a
result of any failure to fulfill on or before the date specified in such
Notice of Borrowing for such Borrowing the applicable conditions set forth
in Article III, including, without limitation, any loss, cost or expense
incurred by reason of the liquidation or reemployment of deposits or other
funds acquired by such Lender to fund the Advance to be made by such Lender
as part of such Borrowing when such Advance, as a result of such failure,
is not made on such date.
(e) Unless the Administrative Agent shall have received notice from an
Appropriate Lender prior to the date of any Borrowing under a Facility
under which such Lender has a Commitment that such Lender will not make
available to the Administrative Agent such Lender's ratable portion of such
Borrowing, the Administrative Agent may assume that such Lender has made
such portion available to the Administrative Agent on the date of such
Borrowing in accordance with subsection (a) of this Section 2.02 and the
Administrative Agent may, in reliance upon such assumption, make available
to the Borrower on such date a corresponding amount. If and to the extent
that such Lender shall not have so made such ratable portion available to
the Administrative Agent, such Lender and the Borrower severally agree to
repay or pay to the Administrative Agent forthwith on demand such
corresponding amount and
to pay interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid or paid to
the Administrative Agent, at (i) in the case of the Borrower, the interest
rate applicable at such time under Section 2.07 to Advances comprising such
Borrowing and (ii) in the case of such Lender, the Federal Funds Rate. If
such Lender shall pay to the Administrative Agent such corresponding
amount, such amount so paid shall constitute such Lender's Advance as part
of such Borrowing for all purposes.
(f) The failure of any Lender to make the Advance to be made by it as
part of any Borrowing shall not relieve any other Lender of its obligation,
if any, hereunder to make its Advance on the date of such Borrowing, but no
Lender shall be responsible for the failure of any other Lender to make the
Advance to be made by such other Lender on the date of any Borrowing.
SECTION 2.03. Issuance of and Drawings and Reimbursement Under Letters
of Credit. (a) Request for Issuance. Each Letter of Credit shall be issued
upon notice, given not later than 11:00 A.M. (New York City time) on the
third Business Day (or such fewer days as the Issuing Bank and the Borrower
shall agree) prior to the date of the proposed issuance of such Letter of
Credit, by the Borrower to the Issuing Bank, which shall give to the
Administrative Agent and each Revolving Credit Lender prompt notice thereof
by telecopier or electronic communication. Each such notice of issuance of
a Letter of Credit (a "Notice of Issuance") shall be by telephone,
confirmed immediately in writing, or telecopier electronic communication,
specifying therein the requested (A) date of such issuance (which shall be
a Business Day), (B) Available Amount of such Letter of Credit,
(C) expiration date of such Letter of Credit, (D) name and address of the
beneficiary of such Letter of Credit and (E) form of such Letter of Credit,
and shall be accompanied by such application and agreement for letter of
credit as the Issuing Bank may specify to the Borrower for use in
connection with such requested Letter of Credit (a "Letter of Credit
Agreement"). If (x) the requested form of such Letter of Credit is
acceptable to the Issuing Bank in its sole discretion and (y) it has not
received notice of objection to such issuance from Lenders holding at least
51% of the Revolving Credit Commitments, the Issuing Bank will, upon
fulfillment of the applicable conditions set forth in Article III, make
such Letter of Credit available to the Borrower at its office referred to
in Section 9.02 or as otherwise agreed with the Borrower in connection with
such issuance. In the event and to the extent that the provisions of any
Letter of Credit Agreement shall conflict with this Agreement, the
provisions of this Agreement shall govern.
(b) Letter of Credit Reports. The Issuing Bank shall furnish (A) to
the Administrative Agent on the first Business Day of each week a written
report summarizing issuance and expiration dates of Letters of Credit
issued during the previous week and drawings during such week under all
Letters of Credit, (B) to each Revolving Credit Lender on the first
Business Day of each month a written report summarizing issuance and
expiration dates of Letters of Credit issued during the preceding month and
drawings during such month under all Letters of Credit and (C) to the
Administrative Agent and each Revolving Credit Lender on the first Business
Day of each calendar quarter a written report setting forth the average
daily aggregate Available Amount during the preceding calendar quarter of
all Letters of Credit.
(c) Participations in Letters of Credit. Upon the issuance of a Letter
of Credit by the Issuing Bank under Section 2.03(a), the Issuing Bank shall
be deemed, without further
action by any party hereto, to have sold to each Revolving Credit Lender,
and each such Revolving Credit Lender shall be deemed, without further
action by any party hereto, to have purchased from the Issuing Bank, a
participation in such Letter of Credit in an amount for each Revolving
Credit Lender equal to such Lender's Pro Rata Share of the Available Amount
of such Letter of Credit, effective upon the issuance of such Letter of
Credit. In consideration and in furtherance of the foregoing, each
Revolving Credit Lender hereby absolutely and unconditionally agrees to pay
such Lender's Pro Rata Share of each L/C Disbursement made by the Issuing
Bank and not reimbursed by the Borrower forthwith on the date due as
provided in Section 2.04(d) by making available for the account of its
Applicable Lending Office to the Administrative Agent for the account of
the Issuing Bank by deposit to the Administrative Agent's Account, in same
day funds, an amount equal to such Lender's Pro Rata Share of such L/C
Disbursement. Each Revolving Credit Lender acknowledges and agrees that its
obligation to acquire participations pursuant to this Section 2.03(c) in
respect of Letters of Credit is absolute and unconditional and shall not be
affected by any circumstance whatsoever, including the occurrence and
continuance of a Default or an Event of Default or the termination of the
Commitments, and that each such payment shall be made without any set-off,
abatement, withholding or reduction whatsoever. If and to the extent that
any Revolving Credit Lender shall not have so made the amount of such L/C
Disbursement available to the Administrative Agent, such Revolving Credit
Lender agrees to pay to the Administrative Agent forthwith on demand such
amount together with interest thereon, for each day from the date such L/C
Disbursement is due pursuant to Section 2.04(d) until the date such amount
is paid to the Administrative Agent, at the Federal Funds Rate for its
account or the account of the Issuing Bank, as applicable. If such Lender
shall pay to the Administrative Agent such amount for the account of the
Issuing Bank on any Business Day, such amount so paid in respect of
principal shall constitute a Letter of Credit Advance made by such Lender
on such Business Day for purposes of this Agreement, and the outstanding
principal amount of the Letter of Credit Advance made by the Issuing Bank
shall be reduced by such amount on such Business Day.
(d) Drawing and Reimbursement. The payment by the Issuing Bank of a
draft drawn under any Letter of Credit shall constitute for all purposes of
this Agreement the making by the Issuing Bank of a Letter of Credit
Advance, which shall be a Base Rate Advance, in the amount of such draft.
(e) Failure to Make Letter of Credit Advances. The failure of any
Lender to make the Letter of Credit Advance to be made by it on the date
specified in Section 2.03(c) shall not relieve any other Lender of its
obligation hereunder to make its Letter of Credit Advance on such date, but
no Lender shall be responsible for the failure of any other Lender to make
the Letter of Credit Advance to be made by such other Lender on such date.
SECTION 2.04. Repayment of Advances. (a) Term B Advances. The Borrower
shall repay to the Administrative Agent for the ratable account of the Term
B Lenders the aggregate outstanding principal amount of the Term B Advances
on the following dates in the amounts indicated (which amounts shall be
reduced as a result of the application of prepayments in accordance with
the order of priority set forth in Section 2.06):
Date Amount
June 30, 2004 $375,000
September 30, 2004 $375,000
December 31, 2004 $375,000
March 31, 2005 $375,000
June 30, 2005 $375,000
September 30, 2005 $375,000
December 31, 2005 $375,000
March 31, 2006 $375,000
June 30, 2006 $375,000
September 30, 2006 $375,000
December 31, 2006 $375,000
March 31, 2007 $375,000
June 30, 2007 $36,375,000
September 30, 2007 $36,375,000
December 31, 2007 $36,375,000
March 30, 2008 $36,375,000
provided, however, that the final principal installment shall be repaid on
the Termination Date in respect of the Term B Facility and in any event
shall be in an amount equal to the aggregate principal amount of the Term B
Advances outstanding on such date.
(b) Revolving Credit Advances. The Borrower shall repay to the
Administrative Agent for the ratable account of the Revolving Credit
Lenders on the Termination Date in respect of the Revolving Credit Facility
the aggregate principal amount of the Revolving Credit Advances then
outstanding.
(c) Swing Line Advances. The Borrower shall repay to the
Administrative Agent for the account of the Swing Line Bank and each other
Revolving Credit Lender that has made a Swing Line Advance the outstanding
principal amount of each Swing Line Advance made by each of them on the
earlier of the maturity date specified in the applicable Notice of Swing
Line Borrowing (which maturity shall be no later than the tenth Business
Day after the requested date of such Borrowing) and the Termination Date in
respect of the Revolving Credit Facility.
(d) Letter of Credit Advances. (i) The Borrower shall repay to the
Administrative Agent for the account of the Issuing Bank and each other
Revolving Credit Lender that has made a Letter of Credit Advance on the
earlier of demand and the Termination Date in respect of the Revolving
Credit Facility the outstanding principal amount of each Letter of Credit
Advance made by each of them.
(ii) The Obligations of the Borrower under this Agreement, any Letter
of Credit Agreement and any other agreement or instrument relating to any
Letter of Credit shall be unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement, such Letter of
Credit Agreement and such other agreement or instrument under all
circumstances, including, without limitation, the following circumstances:
(A) any lack of validity or enforceability of any Loan Document,
any Letter of Credit Agreement, any Letter of Credit or any other
agreement or instrument relating thereto (all of the foregoing being,
collectively, the "L/C Related Documents");
(B) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Obligations of the Borrower in
respect of any L/C Related Document or any other amendment or waiver
of or any consent to departure from all or any of the L/C Related
Documents;
(C) the existence of any claim, set-off, defense or other right
that the Borrower may have at any time against any beneficiary or any
transferee of a Letter of Credit (or any Persons for which any such
beneficiary or any such transferee may be acting), the Issuing Bank or
any other Person, whether in connection with the transactions
contemplated by the L/C Related Documents or any unrelated
transaction;
(D) any statement or any other document presented under a Letter
of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any
respect;
(E) payment by the Issuing Bank under a Letter of Credit against
presentation of a draft, certificate or other document that does not
strictly comply with the terms of such Letter of Credit;
(F) any exchange, release or non-perfection of any Collateral or
other collateral, or any release or amendment or waiver of or consent
to departure from the Guaranties or any other guarantee, for all or
any of the Obligations of the Borrower in respect of the L/C Related
Documents; or
(G) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing, including, without limitation,
any other circumstance that might otherwise constitute a defense
available to, or a discharge of, the Borrower.
SECTION 2.05. Termination or Reduction of the Commitments.
(a) Optional. The Borrower may, upon at least three Business Days' notice
to the Administrative Agent, terminate in whole or reduce in part the
unused portions of the Unused Revolving Credit Commitments; provided,
however, that each partial reduction of the Revolving Credit Facility
(i) shall be in an aggregate amount of $5,000,000 or an integral multiple
of $1,000,000 in excess thereof and (ii) shall be made ratably among the
Appropriate Lenders in accordance with their respective Pro Rata Shares
with respect to such Facility.
(b) Mandatory. (i) Upon the funding of the Term B Advances on the
Effective Date pursuant to Section 2.01(a), the aggregate Term B
Commitments of the Term B Lenders shall be reduced to zero.
(ii) The Letter of Credit Facility shall be permanently reduced from
time to time on the date of each reduction in the Revolving Credit Facility
by the amount, if any, by which the amount of the Letter of Credit Facility
exceeds the Revolving Credit Facility after giving effect to such reduction
of the Revolving Credit Facility.
(iii) The Swing Line Facility shall be permanently reduced from time
to time on the date of each reduction in the Revolving Credit Facility by
the amount, if any, by which the amount of the Swing Line Facility exceeds
the Revolving Credit Facility after giving effect to such reduction of the
Revolving Credit Facility.
SECTION 2.06. Prepayments. (a) Optional. The Borrower may, upon at
least one Business Day's notice in the case of Base Rate Advances and three
Business Days' notice in the case of Eurodollar Rate Advances, in each case
to the Administrative Agent stating the proposed date and aggregate
principal amount of the prepayment, and if such notice is given the
Borrower shall, prepay the outstanding aggregate principal amount of the
Advances comprising part of the same Borrowing in whole or ratably in part,
together with accrued interest to the date of such prepayment on the
aggregate principal amount prepaid; provided, however, that (x) each
partial prepayment shall be in an aggregate principal amount of $5,000,000
or an integral multiple of $1,000,000 in excess thereof and (y) if any
prepayment of a Eurodollar Rate Advance is made on a date other than the
last day of an Interest Period for such Advance, the Borrower shall also
pay any amounts owing pursuant to Section 9.04(c). Each such prepayment of
any Term B Advance shall be applied to the installments thereof on a pro
rata basis ratably to the Appropriate Lenders in accordance with their
respective outstanding Term B Advances.
(b) Mandatory. (i) The Borrower shall, on the 90th day following the
end of each Fiscal Year, if the Leverage Ratio as of the last day of such
Fiscal Year is greater than 3.50:1.00, prepay an aggregate principal amount
of the Term B Advances in an amount equal to 50% of the amount of Excess
Cash Flow for such Fiscal Year. Each such prepayment shall be applied to
the installments of the Term B Facility on a pro rata basis ratably to the
Appropriate Lenders in accordance with their respective outstanding Term B
Advances.
(ii) The Borrower shall, on each Prepayment Date, prepay an aggregate
principal amount of the Term B Advances in an amount equal to the amount of
such Net Cash Proceeds. Each such prepayment shall be applied to the
installments of the Term B Facility on a pro rata basis ratably to the
Appropriate Lenders in accordance with their respective outstanding Term B
Advances.
(iii) The Borrower shall, on each Business Day, prepay an aggregate
principal amount of the Revolving Credit Advances comprising part of the
same Borrowings, the Letter of Credit Advances and the Swing Line Advances
and deposit an amount in the L/C Collateral Account in an amount equal to
the amount by which (A) the sum of the aggregate principal amount of (x)
the Revolving Credit Advances, (y) the Letter of Credit Advances and
(z) the Swing Line Advances then outstanding plus the aggregate Available
Amount of all Letters of Credit then outstanding exceeds (B) the Revolving
Credit Facility on such Business Day.
(iv) The Borrower shall, on each Business Day, pay to the
Administrative Agent for deposit in the L/C Collateral Account an amount
sufficient to cause the aggregate amount on deposit in the L/C Collateral
Account to equal the amount by which the aggregate Available Amount of all
Letters of Credit then outstanding exceeds the Letter of Credit Facility on
such Business Day.
(v) Prepayments of the Revolving Credit Facility made pursuant to
clause (iii) above shall be first applied to prepay Letter of Credit
Advances then outstanding until such Advances are paid in full, second
applied to prepay Swing Line Advances then outstanding until such Advances
are paid in full and third applied to prepay Revolving Credit Advances then
outstanding comprising part of the same Borrowings until such Advances are
paid in full and fourth deposited in the L/C Collateral Account to cash
collateralize 100% of the Available Amount of the Letters of Credit then
outstanding; and the amount remaining (if any) after the prepayment in full
of the Advances then outstanding and the 100% cash collateralization of the
aggregate Available Amount of Letters of Credit then outstanding may be
retained by the Borrower. Upon the drawing of any Letter of Credit for
which funds are on deposit in the L/C Collateral Account, such funds shall
be applied to reimburse the Issuing Bank or Revolving Credit Lenders, as
applicable.
(vi) Anything contained in this Section 2.06(b) to the contrary
notwithstanding, if, following the occurrence of any "Asset Disposition"
(as such term is defined in the 2002 Senior Notes Indenture) by any Loan
Party or any of its Subsidiaries, the Parent would be required to apply or
cause its Subsidiaries to apply an amount equal to any of the "Net
Available Cash" (as defined in the 2002 Senior Notes Indenture) thereof by
a particular date (an "Application Date") in a particular manner, in order
to excuse the Borrower from being required to make an "Offer" (as defined
in the 2002 Senior Notes Indenture) in connection with such "Asset
Disposition," and the Borrower shall have failed to so apply an amount
equal to such "Net Available Cash" at least 10 days before the applicable
Application Date, or cause to be applied an amount equal to any such "Net
Available Cash," then the Borrower shall immediately pay or cause to be
paid to the Administrative Agent an amount equal to such "Net Available
Cash" to be applied to the payment of the Term B Advances in the manner set
forth in Section 2.06(b)(ii) in such amounts as shall excuse the Borrower
from making any such "Offer".
(vii) All prepayments under this subsection (b) shall be made together
with accrued interest to the date of such prepayment on the principal
amount prepaid, together with any amounts owing pursuant to Section
9.04(c).
SECTION 2.07. Interest. (a) Scheduled Interest. The Borrower shall pay
interest on the unpaid principal amount of each Advance owing to each
Lender from the date of such Advance until such principal amount shall be
paid in full, at the following rates per annum:
(i) Base Rate Advances. During such periods as such Advance is a
Base Rate Advance, a rate per annum equal at all times to the sum of
(A) the Base Rate in effect from time to time plus (B) the Applicable
Margin in effect from time to time, payable in arrears quarterly on
the last day of each March, June, September and December during such
periods and on the date such Base Rate Advance shall be Converted or
paid in full.
(ii) Eurodollar Rate Advances. During such periods as such
Advance is a Eurodollar Rate Advance, a rate per annum equal at all
times during each Interest Period for such Advance to the sum of
(A) the Eurodollar Rate for such Interest Period for such Advance plus
(B) the Applicable Margin in effect on the first day of such Interest
Period, payable in arrears on the last day of such Interest Period
and, if such Interest Period has a duration of more than three months,
on each day that occurs during such Interest Period
every three months from the first day of such Interest Period and on
the date such Eurodollar Rate Advance shall be Converted or paid in
full.
(b) Default Interest. Upon the occurrence and during the continuance
of a Default under Section 6.01(a), the Administrative Agent may, and upon
the request of the Required Lenders shall, require that the Borrower pay
interest ("Default Interest") on (i) the unpaid overdue principal amount of
each Advance owing to each Lender Party, payable in arrears on the dates
referred to in clause (i) or (ii) of Section 2.07(a), as applicable, and on
demand, at a rate per annum equal at all times to 2% per annum above the
rate per annum required to be paid on such Advance pursuant to clause (i)
or (ii) of Section 2.07(a), as applicable, and (ii) to the fullest extent
permitted by applicable law, the amount of any interest, fee or other
amount payable under this Agreement or any other Loan Document to any Agent
or any Lender Party that is not paid when due, from the date such amount
shall be due until such amount shall be paid in full, payable in arrears on
the date such amount shall be paid in full and on demand, at a rate per
annum equal at all times to 2% per annum above the rate per annum required
to be paid, in the case of interest, on the Type of Advance on which such
interest has accrued pursuant to clause (i) or (ii) of Section 2.07(a), as
applicable, and, in all other cases, on Base Rate Advances pursuant to
clause (i) of Section 2.07(a); provided, however, that following the
acceleration of the Advances, or the giving of notice by the Agent to
accelerate the Advances, pursuant to Section 6.01, Default Interest shall
accrue and be payable hereunder whether or not previously required by the
Administrative Agent.
(c) Notice of Interest Period and Interest Rate. Promptly after
receipt of a Notice of Borrowing pursuant to Section 2.02(a), a notice of
Conversion pursuant to Section 2.09 or a notice of selection of an Interest
Period pursuant to the terms of the definition of "Interest Period", the
Administrative Agent shall give notice to the Borrower and each Appropriate
Lender of the applicable Interest Period and the applicable interest rate
determined by the Administrative Agent for purposes of clause (a)(i) or
(a)(ii) above.
SECTION 2.08. Fees. (a) Commitment Fee. The Borrower shall pay to the
Administrative Agent for the account of the Revolving Credit Lenders a
commitment fee, from the Effective Date in the case of each Initial Lender
and from the effective date specified in the Assignment and Acceptance
pursuant to which it became a Lender in the case of each other Lender until
the Termination Date, payable in arrears quarterly on the last day of each
March, June, September and December, commencing June 30, 2004, and on the
Termination Date, at the rate of 1/2 of 1% per annum on the average daily
Unused Revolving Credit Commitment of such Lender; provided, however, that
any commitment 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
Borrower so long as such Lender shall be a Defaulting Lender except to the
extent that such commitment fee shall otherwise have been due and payable
by the Borrower prior to such time; and provided further that no commitment
fee shall accrue on any of the Commitments of a Defaulting Lender so long
as such Lender shall be a Defaulting Lender.
(b) Letter of Credit Fees, Etc. (i) The Borrower shall pay to the
Administrative Agent for the account of each Revolving Credit Lender a
commission, payable in arrears quarterly on the last day of each March,
June, September and December, commencing
June 30, 2004, and on the earliest to occur of the full drawing,
expiration, termination or cancellation of any Letter of Credit and on the
Termination Date in respect of the Letter of Credit Facility, on such
Lender's Pro Rata Share of the average daily aggregate Available Amount
during such quarter of (A) all Standby Letters of Credit outstanding from
time to time at the Applicable Margin for Eurodollar Rate Advances under
the Revolving Credit Facility and (B) all Trade Letters of Credit then
outstanding at the rate of 0.20% per annum. Upon the occurrence and during
the continuance of a Default under Section 6.01(a) or 6.01(f), the amount
of commission payable by the Borrower under this clause (b)(i) shall be
increased by 2% per annum on any overdue amounts.
(ii) The Borrower shall pay to the Issuing Bank, for its own account,
(A) a commission, payable in arrears quarterly on the last day of each
March, June, September and December, commencing June 30, 2004, and on the
Termination Date in respect of the Letter of Credit Facility, on the
average daily aggregate Available Amount during such quarter, from the
Effective Date until the Termination Date in respect of the Letter of
Credit Facility, at the rate of 1/4 of 1% per annum and (B) such other
commissions, fronting fees, issuance fees, transfer fees and other fees and
charges in connection with the issuance or administration of each Letter of
Credit as the Borrower and the Issuing Bank shall agree.
(c) Agents' Fees. The Borrower shall pay to each Agent for its own
account such fees as may from time to time be agreed between the Borrower
and such Agent.
SECTION 2.09. Conversion of Advances. (a) Optional. The Borrower may
on any Business Day, upon notice given to the Administrative Agent not
later than 11:00 A.M. (New York City time) on the third Business Day prior
to the date of the proposed Conversion and subject to the provisions of
Section 2.10, Convert all or any portion of the Advances of one Type
comprising the same Borrowing into Advances of the other Type; provided,
however, that any Conversion of Eurodollar Rate Advances into Base Rate
Advances shall be made only on the last day of an Interest Period for such
Eurodollar Rate Advances, any Conversion of Base Rate Advances into
Eurodollar Rate Advances shall be in an amount not less than the minimum
amount specified in Section 2.02(c), no Conversion of any Advances shall
result in more separate Borrowings than permitted under Section 2.02(c) and
each Conversion of Advances comprising part of the same Borrowing under any
Facility shall be made ratably among the Appropriate Lenders in accordance
with their Commitments under such Facility. Each such notice of Conversion
shall, within the restrictions specified above, specify (i) the date of
such Conversion, (ii) the Advances to be Converted and (iii) if such
Conversion is into Eurodollar Rate Advances, the duration of the initial
Interest Period for such Advances. Each notice of Conversion shall be
irrevocable and binding on the Borrower.
(b) Mandatory. (i) On the date on which the aggregate unpaid principal
amount of Eurodollar Rate Advances comprising any Borrowing shall be
reduced, by payment or prepayment or otherwise, to less than $1,000,000,
other than by reason of an amortization payment, such Advances shall
automatically Convert into Base Rate Advances.
(ii) If the Borrower shall fail to select the duration of any Interest
Period for any Eurodollar Rate Advances in accordance with the provisions
contained in the definition of "Interest Period" in Section 1.01, the
Administrative Agent will forthwith so notify the Borrower
and the Appropriate Lenders, whereupon each such Eurodollar Rate Advance
will automatically, on the last day of the then existing Interest Period
therefor, Convert into a Eurodollar Rate Advance with an Interest Period of
one month.
(iii) Upon the occurrence and during the continuance of any Default,
(x) each Eurodollar Rate Advance will automatically, on the last day of the
then existing Interest Period therefor, Convert into a Base Rate Advance
and (y) the obligation of the Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended.
SECTION 2.10. Increased Costs, Etc. (a) If, due to either (i) the
adoption of or any change in or in the interpretation of any law or
regulation after the date of this Agreement or (ii) the compliance with any
guideline or request from any central bank or other governmental authority
(whether or not having the force of law) after the date of this Agreement,
there shall be any increase in the cost to any Lender Party of agreeing to
make or of making, funding or maintaining Eurodollar Rate Advances or of
agreeing to issue or of issuing or maintaining or participating in Letters
of Credit or of agreeing to make or of making or maintaining Letter of
Credit Advances (excluding, for purposes of this Section 2.10, any such
increased costs resulting from (x) Taxes or Other Taxes (as to which
Section 2.12 shall govern) and (y) changes in the basis of taxation of
overall net income or overall gross income by the United States or by the
foreign jurisdiction or state under the laws of which such Lender Party is
organized or has its Applicable Lending Office or any political subdivision
thereof), then the Borrower shall from time to time, upon demand by such
Lender Party (with a copy of such demand to the Administrative Agent), pay
to the Administrative Agent for the account of such Lender Party additional
amounts sufficient to compensate such Lender Party for such increased
cost; provided, however, that the Borrower shall not be responsible for
costs under this Section 2.10(a) arising more than 180 days prior to
receipt by the Borrower of the demand from the affected Lender Party
pursuant to this Section 2.10(a). A certificate as to the amount of such
increased cost, submitted to the Borrower by such Lender Party, shall be
conclusive and binding for all purposes, absent manifest error.
(b) If any Lender Party determines that compliance with any law or
regulation or any guideline or request from any central bank or other
governmental authority (whether or not having the force of law) which
becomes effective after the date hereof affects or would affect the amount
of capital required or expected to be maintained by such Lender Party or
any corporation controlling such Lender Party and that the amount of such
capital is increased by or based upon the existence of such Lender Party's
commitment to lend or to issue or participate in Letters of Credit
hereunder and other commitments of such type or the issuance or maintenance
of or participation in the Letters of Credit (or similar contingent
obligations) (and a similar reserve requirement is not already reflected in
the definition of "Eurodollar Rate"), then, upon demand by such Lender
Party or such corporation (with a copy of such demand to the Administrative
Agent), the Borrower shall pay to the Administrative Agent for the account
of such Lender Party, from time to time as specified by such Lender Party,
additional amounts sufficient to compensate such Lender Party in the light
of such circumstances, to the extent that such Lender Party reasonably
determines such increase in capital to be allocable to the existence of
such Lender Party's commitment to lend or to issue or participate in
Letters of Credit hereunder or to the issuance or maintenance of or
participation in any Letters of Credit provided, further, that the Borrower
shall not be responsible for costs under this Section 2.10(b) arising
more than 180 days prior to receipt by the Borrower of the demand from the
affected Lender Party pursuant to this Section 2.10(b). A certificate as to
such amounts submitted to the Borrower by such Lender Party shall be
conclusive and binding for all purposes, absent manifest error.
(c) Notwithstanding any other provision of this Agreement, if the
adoption of or any change in or in the interpretation of any law or
regulation shall make it unlawful, or any central bank or other
governmental authority shall assert that it is unlawful, for any Lender or
its Eurodollar Lending Office to perform its obligations hereunder to make
Eurodollar Rate Advances or to continue to fund or maintain Eurodollar Rate
Advances hereunder, then, on notice thereof and demand therefor by such
Lender to the Borrower through the Administrative Agent, (i) each
Eurodollar Rate Advance under each Facility under which such Lender has a
Commitment will automatically, upon such demand, Convert into a Base Rate
Advance and (ii) the obligation of the Appropriate Lenders to make, or to
Convert Advances into, Eurodollar Rate Advances shall be suspended until
the Administrative Agent shall notify the Borrower that such Lender has
determined that the circumstances causing such suspension no longer exist;
provided, however, that, before making any such demand, such Lender agrees
to use reasonable efforts (consistent with its internal policy and legal
and regulatory restrictions) to designate a different Eurodollar Lending
Office if the making of such a designation would allow such Lender or its
Eurodollar Lending Office to continue to perform its obligations to make
Eurodollar Rate Advances or to continue to fund or maintain Eurodollar Rate
Advances and would not, in the judgment of such Lender, be otherwise
disadvantageous to such Lender.
SECTION 2.11. Payments and Computations. (a) The Borrower shall make
each payment hereunder and under the Notes, irrespective of any right of
counterclaim or set-off (except as otherwise provided in Section 2.15), not
later than 11:00 A.M. (New York City time) on the day when due in U.S.
dollars to the Administrative Agent at the Administrative Agent's Account
in same day funds, with payments being received by the Administrative Agent
after such time being deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. The
Administrative Agent will promptly thereafter cause like funds to be
distributed (i) if such payment by the Borrower is in respect of principal,
interest, commitment fees or any other Obligation then payable hereunder
and under the Notes to more than one Lender Party, to such Lender Parties
for the account of their respective Applicable Lending Offices ratably in
accordance with the amounts of such respective Obligations then payable to
such Lender Parties and (ii) if such payment by the Borrower is in respect
of any Obligation then payable hereunder to one Lender Party, to such
Lender Party for the account of its Applicable Lending Office, in each case
to be applied in accordance with the terms of this Agreement. Upon its
acceptance of an Assignment and Acceptance and recording of the information
contained therein in the Register pursuant to Section 9.07(d), from and
after the effective date of such Assignment and Acceptance, the
Administrative Agent shall make all payments hereunder and under the Notes
in respect of the interest assigned thereby to the Lender Party assignee
thereunder, and the parties to such Assignment and Acceptance shall make
all appropriate adjustments in such payments for periods prior to such
effective date directly between themselves.
(b) The Borrower hereby authorizes each Lender Party and each of its
Affiliates, if and to the extent payment owed to such Lender Party is not
made when due
hereunder or, in the case of a Lender, under the Note held by such Lender,
to charge from time to time, to the fullest extent permitted by law,
against any or all of the Borrower's accounts with such Lender Party or
such Affiliate any amount so due; provided, that such Lender first confirms
with the Administrative Agent that such payment has not been made to the
Administrative Agent.
(c) All computations of interest based on the Base Rate shall be made
by the Administrative Agent on the basis of a year of 365 or 366 days, as
the case may be, and all computations of interest based on the Eurodollar
Rate or the Federal Funds Rate and of fees and Letter of Credit commissions
shall be made by the Administrative Agent on the basis of a year of 360
days, in each case for the actual number of days (including the first day
but excluding the last day) occurring in the period for which such
interest, fees or commissions are payable. Each determination by the
Administrative Agent of an interest rate, fee or commission hereunder shall
be conclusive and binding for all purposes, absent manifest error.
(d) Whenever any payment hereunder or under the Notes shall be stated
to be due on a day other than a Business Day, such payment shall be made on
the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of payment of interest or commitment or
letter of credit fee or commission, as the case may be; provided, however,
that, if such extension would cause payment of interest on or principal of
Eurodollar Rate Advances to be made in the next following calendar month,
such payment shall be made on the next preceding Business Day.
(e) Unless the Administrative Agent shall have received notice from
the Borrower prior to the date on which any payment is due to any Lender
Party hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in
full to the Administrative Agent on such date and the Administrative Agent
may, in reliance upon such assumption, cause to be distributed to each such
Lender Party on such due date an amount equal to the amount then due such
Lender Party. If and to the extent the Borrower shall not have so made such
payment in full to the Administrative Agent, each such Lender Party shall
repay to the Administrative Agent forthwith on demand such amount
distributed to such Lender Party together with interest thereon, for each
day from the date such amount is distributed to such Lender Party until the
date such Lender Party repays such amount to the Administrative Agent, at
the Federal Funds Rate.
(f) Whenever any payment received by the Administrative Agent under
this Agreement or any of the other Loan Documents is insufficient to pay in
full all amounts due and payable to the Agents and the Lender Parties under
or in respect of this Agreement and the other Loan Documents on any date,
such payment shall be distributed by the Administrative Agent and applied
by the Agents and the Lender Parties in the following order of priority:
(i) first, to the payment of all of the fees, indemnification
payments, costs and expenses that are due and payable to the Agents
(solely in their respective capacities as Agents) under or in respect
of this Agreement and the other Loan Documents on such date, ratably
based upon the respective aggregate amounts of all such fees,
indemnification payments, costs and expenses owing to the Agents on
such date;
(ii) second, to the payment of all of the fees, indemnification
payments, costs and expenses that are due and payable to the Issuing
Bank and the Swing Line Bank (solely in their respective capacities as
such) under or in respect of this Agreement and the other Loan
Documents on such date, ratably based upon the respective aggregate
amounts of all such fees, indemnification payments, costs and expenses
owing to the Issuing Bank and the Swing Line Bank on such date;
(iii) third, to the payment of all of the indemnification
payments, costs and expenses that are due and payable to the Lenders
under Sections 9.04 hereof, Section 20 of the Security Agreement and
any similar section of any of the other Loan Documents on such date,
ratably based upon the respective aggregate amounts of all such
indemnification payments, costs and expenses owing to the Lenders on
such date;
(iv) fourth, to the payment of all of the amounts that are due
and payable to the Administrative Agent and the Lender Parties under
Sections 2.10 and 2.12 hereof on such date, ratably based upon the
respective aggregate amounts thereof owing to the Administrative Agent
and the Lender Parties on such date;
(v) fifth, to the payment of all of the fees that are due and
payable to the Lenders under Section 2.08(a) on such date, ratably
based upon the respective aggregate Commitments of the Lenders under
the Facilities on such date;
(vi) sixth, to the payment of all of the accrued and unpaid
interest on the Obligations of the Borrower under or in respect of the
Loan Documents that is due and payable to the Administrative Agent and
the Lender Parties under Section 2.07(b) on such date, ratably based
upon the respective aggregate amounts of all such interest owing to
the Administrative Agent and the Lender Parties on such date;
(vii) seventh, to the payment of all of the accrued and unpaid
interest on the Advances that is due and payable to the Administrative
Agent and the Lender Parties under Section 2.07(a) on such date,
ratably based upon the respective aggregate amounts of all such
interest owing to the Administrative Agent and the Lender Parties on
such date;
(viii) eighth, to the payment of the principal amount of all of
the outstanding Advances that is due and payable to the Administrative
Agent and the Lender Parties on such date, ratably based upon the
respective aggregate amounts of all such principal owing to the
Administrative Agent and the Lender Parties on such date; and
(ix) ninth, to the payment of all other Obligations of the Loan
Parties owing under or in respect of the Loan Documents that are due
and payable to the Administrative Agent and the other Secured Parties
on such date, ratably based upon the respective aggregate amounts of
all such Obligations owing to the Administrative Agent and the other
Secured Parties on such date.
If the Administrative Agent receives funds for application to the
Obligations of the Loan Parties under or in respect of the Loan Documents
under circumstances for which the Loan Documents do not specify the
Advances or the Facility to which, or the manner in which, such funds are
to
be applied, the Administrative Agent may, but shall not be obligated to,
elect to distribute such funds to each of the Lender Parties in accordance
with such Lender Party's Pro Rata Share of the sum of (A) the aggregate
principal amount of all Advances outstanding at such time and (b) the
aggregate Available Amount of all Letters of Credit outstanding at such
time, in repayment or prepayment of such of the outstanding Advances or
other Obligations then owing to such Lender Party, and, in the case of the
Term B Facility, for application to such principal repayment installments
thereof, as the Administrative Agent shall direct.
SECTION 2.12. Taxes. (a) Any and all payments by or on account of any
obligation of any Loan Party hereunder or under the Notes or any other Loan
Document shall be made free and clear of and without deduction for any
Indemnified Taxes or Other Taxes; provided that if any Loan Party shall be
required to deduct any Indemnified Taxes or Other Taxes from such payments,
then (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent or any
Lender Party (as the case may be) receives an amount equal to the sum it
would have received had no such deductions been made, (ii) such Loan Party
shall make such deductions and (iii) such Loan Party shall pay the full
amount deducted to the relevant Governmental Authority in accordance with
applicable law.
(b) In addition, a Loan Party shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) Each Loan Party shall indemnify the Administrative Agent and each
Lender Party, within 10 days after written demand therefor, for the full
amount of any Indemnified Taxes or Other Taxes paid by the Administrative
Agent or such Lender Party, as the case may be, on or with respect to any
payment by or on account of any obligation of such Loan Party hereunder or
under the Notes or under any other Loan Document (including Indemnified
Taxes or Other Taxes imposed or asserted on or attributable to amounts
payable under this Section) and any penalties, interest and reasonable
expenses arising therefrom or with respect thereto, whether or not such
Indemnified Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority. A certificate as to the
amount of such payment or liability delivered to a Loan Party by a Lender
Party or the Administrative Agent on its own behalf or on behalf of a
Lender Party, shall be conclusive absent manifest error.
(d) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by any Loan Party to a Governmental Authority, such Loan Party
shall deliver to the Administrative Agent the original or a certified copy
of a receipt issued by such Governmental Authority evidencing such payment,
a copy of the return reporting such payment or other evidence of such
payment reasonably satisfactory to the Administrative Agent.
(e) Any Foreign Lender Party that is entitled to an exemption from or
reduction of withholding tax under the law of the jurisdiction in which a
Loan Party is located, or any treaty to which such jurisdiction is a party,
with respect to payments under this Agreement shall deliver to such Loan
Party (with a copy to the Administrative Agent), at the time or times
prescribed by applicable law, such properly completed and executed
documentation prescribed by applicable law or reasonably requested by such
Loan Party as will permit such payments to be made without withholding or
at a reduced rate; provided that such Foreign Lender has received
written notice from such Loan Party advising it of the availability of such
exemption or reduction and supplying all applicable documentation.
SECTION 2.13. Sharing of Payments, Etc. If any Lender Party shall
obtain at any time any payment (whether voluntary, involuntary, through the
exercise of any right of set-off, or otherwise, other than as a result of
an assignment pursuant to Section 9.07) (a) on account of Obligations due
and payable to such Lender Party hereunder and under the Notes and the
other Loan Documents at such time in excess of its ratable share (according
to the proportion of (i) the amount of such Obligations due and payable to
such Lender Party hereunder and under the Notes and the other Loan
Documents at such time to (ii) the aggregate amount of the Obligations due
and payable to all Lender Parties hereunder and under the Notes and the
other Loan Documents at such time) of payments on account of the
Obligations due and payable to all Lender Parties hereunder and under the
Notes at such time obtained by all the Lender Parties at such time or
(b) on account of Obligations owing (but not due and payable) to such
Lender Party hereunder and under the Notes and the other Loan Documents at
such time in excess of its ratable share (according to the proportion of
(i) the amount of such Obligations owing to such Lender Party hereunder and
under the Notes and the other Loan Documents at such time to (ii) the
aggregate amount of the Obligations owing (but not due and payable) to all
Lender Parties hereunder and under the Notes and the other Loan Documents
at such time) of payments on account of the Obligations owing (but not due
and payable) to all Lender Parties hereunder and under the Notes at such
time obtained by all of the Lender Parties at such time, such Lender Party
shall forthwith purchase from the other Lender Parties such interests or
participating interests in the Obligations due and payable or owing to
them, as the case may be, as shall be necessary to cause such purchasing
Lender Party to share the excess payment ratably with each of them;
provided, however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender Party, such purchase from
each other Lender Party shall be rescinded and such other Lender Party
shall repay to the purchasing Lender Party the purchase price to the extent
of such Lender Party's ratable share (according to the proportion of
(i) the purchase price paid to such Lender Party to (ii) the aggregate
purchase price paid to all Lender Parties) of such recovery together with
an amount equal to such Lender Party's ratable share (according to the
proportion of (i) the amount of such other Lender Party's required
repayment to (ii) the total amount so recovered from the purchasing Lender
Party) of any interest or other amount paid or payable by the purchasing
Lender Party in respect of the total amount so recovered; provided further
that, so long as the Obligations under the Loan Documents shall not have
been accelerated, any excess payment received by any Appropriate Lender
shall be shared on a pro rata basis only with other Appropriate Lenders.
The Borrower agrees that any Lender Party so purchasing an interest or
participating interest from another Lender Party pursuant to this
Section 2.13 may, to the fullest extent permitted by law, exercise all its
rights of payment (including the right of set-off) with respect to such
interest or participating interest, as the case may be, as fully as if such
Lender Party were the direct creditor of the Borrower in the amount of such
interest or participating interest, as the case may be.
SECTION 2.14. Use of Proceeds. The proceeds of the Advances and
issuances of Letters of Credit shall be available (and the Borrower agrees
that it shall use such proceeds and Letters of Credit) to consummate the
Refinancing, pay related transaction fees and expenses, and provide working
capital for the Borrower and its Subsidiaries for general corporate
purposes which shall include (w) the financing of the Grupo TFM
Acquisition, (x) the financing of the
repayment of certain intercompany loans (the "Intercompany Loan
Repayment"), (y) the financing of the Grupo TFM Investment in connection
with the exercise by the federal government of Mexico or any other Mexican
governmental entity of its put option with respect to certain Equity
Interests in TFM, S.A. de C.V. (the "Mexican Put Option Financing") and (z)
the financing of the Mexrail Acquisition.
SECTION 2.15. Defaulting Lenders. (a) In the event that, at any one
time, (i) any Lender Party shall be a Defaulting Lender, (ii) such
Defaulting Lender shall owe a Defaulted Advance to the Borrower and
(iii) the Borrower shall be required to make any payment hereunder or under
any other Loan Document to or for the account of such Defaulting Lender,
then the Borrower may, so long as no Default shall occur or be continuing
at such time and to the fullest extent permitted by applicable law, set off
and otherwise apply the Obligation of the Borrower to make such payment to
or for the account of such Defaulting Lender against the obligation of such
Defaulting Lender to make such Defaulted Advance. In the event that, on any
date, the Borrower shall so set off and otherwise apply its obligation to
make any such payment against the obligation of such Defaulting Lender to
make any such Defaulted Advance on or prior to such date, the amount so set
off and otherwise applied by the Borrower shall constitute for all purposes
of this Agreement and the other Loan Documents an Advance by such
Defaulting Lender made on the date of such setoff under the Facility
pursuant to which such Defaulted Advance was originally required to have
been made pursuant to Section 2.01. Such Advance shall be considered, for
all purposes of this Agreement, to comprise part of the Borrowing in
connection with which such Defaulted Advance was originally required to
have been made pursuant to Section 2.01, even if the other Advances
comprising such Borrowing shall be Eurodollar Rate Advances on the date
such Advance is deemed to be made pursuant to this subsection (a). The
Borrower shall notify the Administrative Agent at any time the Borrower
exercises its right of set-off pursuant to this subsection (a) and shall
set forth in such notice (A) the name of the Defaulting Lender and the
Defaulted Advance required to be made by such Defaulting Lender and (B) the
amount set off and otherwise applied in respect of such Defaulted Advance
pursuant to this subsection (a). Any portion of such payment otherwise
required to be made by the Borrower to or for the account of such
Defaulting Lender which is paid by the Borrower, after giving effect to the
amount set off and otherwise applied by the Borrower pursuant to this
subsection (a), shall be applied by the Administrative Agent as specified
in subsection (b) or (c) of this Section 2.15.
(b) In the event that, at any one time, (i) any Lender Party shall be
a Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted
Amount to any Agent or any of the other Lender Parties and (iii) the
Borrower shall make any payment hereunder or under any other Loan Document
to the Administrative Agent for the account of such Defaulting Lender, then
the Administrative Agent may, on its behalf or on behalf of such other
Agents or such other Lender Parties and to the fullest extent permitted by
applicable law, apply at such time the amount so paid by the Borrower to or
for the account of such Defaulting Lender to the payment of each such
Defaulted Amount to the extent required to pay such Defaulted Amount. In
the event that the Administrative Agent shall so apply any such amount to
the payment of any such Defaulted Amount on any date, the amount so applied
by the Administrative Agent shall constitute for all purposes of this
Agreement and the other Loan Documents payment, to such extent, of such
Defaulted Amount on such date. Any such amount so applied by the
Administrative Agent shall be retained by the Administrative Agent or
distributed by the
Administrative Agent to such other Agents or such other Lender Parties,
ratably in accordance with the respective portions of such Defaulted
Amounts payable at such time to the Administrative Agent, such other Agents
and such other Lender Parties and, if the amount of such payment made by
the Borrower shall at such time be insufficient to pay all Defaulted
Amounts owing at such time to the Administrative Agent, such other Agents
and such other Lender Parties, in the following order of priority:
(i) first, to the Agents for any Defaulted Amounts then owing to
them, in their capacities as such, ratably in accordance with such
respective Defaulted Amounts then owing to the Agents;
(ii) second, to the Issuing Bank and the Swing Line Bank for any
Defaulted Amounts then owing to them, in their capacities as such,
ratably in accordance with such respective Defaulted Amounts then
owing to the Issuing Bank and the Swing Line Bank; and
(iii) third, to any other Lender Parties for any Defaulted
Amounts then owing to such other Lender Parties, ratably in accordance
with such respective Defaulted Amounts then owing to such other Lender
Parties.
Any portion of such amount paid by the Borrower for the account of such
Defaulting Lender remaining, after giving effect to the amount applied by
the Administrative Agent pursuant to this subsection (b), shall be applied
by the Administrative Agent as specified in subsection (c) of this
Section 2.15.
(c) In the event that, at any one time, (i) any Lender Party shall be
a Defaulting Lender, (ii) such Defaulting Lender shall not owe a Defaulted
Advance or a Defaulted Amount and (iii) the Borrower, any Agent or any
other Lender Party shall be required to pay or distribute any amount
hereunder or under any other Loan Document to or for the account of such
Defaulting Lender, then the Borrower or such Agent or such other Lender
Party shall pay such amount to the Administrative Agent to be held by the
Administrative Agent, to the fullest extent permitted by applicable law, in
escrow or the Administrative Agent shall, to the fullest extent permitted
by applicable law, hold in escrow such amount otherwise held by it. Any
funds held by the Administrative Agent in escrow under this subsection (c)
shall be deposited by the Administrative Agent in an account with a bank
(the "Escrow Bank") selected by the Administrative Agent, in the name and
under the control of the Administrative Agent, but subject to the
provisions of this subsection (c). The terms applicable to such account,
including the rate of interest payable with respect to the credit balance
of such account from time to time, shall be the Escrow Bank's standard
terms applicable to escrow accounts maintained with it. Any interest
credited to such account from time to time shall be held by the
Administrative Agent in escrow under, and applied by the Administrative
Agent from time to time in accordance with the provisions of, this
subsection (c). The Administrative Agent shall, to the fullest extent
permitted by applicable law, apply all funds so held in escrow from time to
time to the extent necessary to make any Advances required to be made by
such Defaulting Lender and to pay any amount payable by such Defaulting
Lender hereunder and under the other Loan Documents to the Administrative
Agent or any other Lender Party, as and when such Advances or amounts are
required to be made or paid and, if the amount so held in escrow shall at
any time be insufficient
to make and pay all such Advances and amounts required to be made or paid
at such time, in the following order of priority:
(i) first, to the Agents for any amounts then due and payable by
such Defaulting Lender to them hereunder, in their capacities as such,
ratably in accordance with such respective amounts then due and
payable to the Agents;
(ii) second, to the Issuing Bank and the Swing Line Bank for any
amounts then due and payable to them hereunder, in their capacities as
such, by such Defaulting Lender, ratably in accordance with such
respective amounts then due and payable to the Issuing Bank and the
Swing Line Bank;
(iii) third, to any other Lender Parties for any amount then due
and payable by such Defaulting Lender to such other Lender Parties
hereunder, ratably in accordance with such respective amounts then due
and payable to such other Lender Parties; and
(iv) fourth, to the Borrower for any Advance then required to be
made by such Defaulting Lender pursuant to a Commitment of such
Defaulting Lender.
In the event that any Lender Party that is a Defaulting Lender shall, at
any time, cease to be a Defaulting Lender, any funds held by the
Administrative Agent in escrow at such time with respect to such Lender
Party shall be distributed by the Administrative Agent to such Lender Party
and applied by such Lender Party to the Obligations owing to such Lender
Party at such time under this Agreement and the other Loan Documents
ratably in accordance with the respective amounts of such Obligations
outstanding at such time.
(d) The rights and remedies against a Defaulting Lender under this
Section 2.15 are in addition to other rights and remedies that the Borrower
may have against such Defaulting Lender with respect to any Defaulted
Advance and that any Agent or any Lender Party may have against such
Defaulting Lender with respect to any Defaulted Amount.
SECTION 2.16. Evidence of Debt. (a) Each Lender Party shall maintain
in accordance with its usual practice an account or accounts evidencing the
indebtedness of the Borrower to such Lender resulting from each Advance
owing to such Lender Party from time to time, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder. The Borrower agrees that upon notice by any Lender Party to the
Borrower (with a copy of such notice to the Administrative Agent) to the
effect that a promissory note or other evidence of indebtedness is required
or appropriate in order for such Lender Party to evidence (whether for
purposes of pledge, enforcement or otherwise) the Advances owing to, or to
be made by, such Lender Party, the Borrower shall promptly execute and
deliver to such Lender Party, with a copy to the Administrative Agent, a
Revolving Credit Note and a Term B Note, as applicable, in substantially
the form of Exhibits A-1 and A-2 hereto, respectively, payable to the order
of such Lender Party in a principal amount equal to the Revolving Credit
Commitment and the Term B Commitment, respectively, of such Lender Party.
All references to Notes in the Loan Documents shall mean Notes, if any, to
the extent issued hereunder.
(b) The Register maintained by the Administrative Agent pursuant to
Section 9.07(d) shall include a control account, and a subsidiary account
for each Lender Party,
in which accounts (taken together) shall be recorded (i) the date and
amount of each Borrowing made hereunder, the Type of Advances comprising
such Borrowing and, if appropriate, the Interest Period applicable thereto,
(ii) the terms of each Assignment and Acceptance delivered to and accepted
by it, (iii) the amount of any principal or interest due and payable or to
become due and payable from the Borrower to each Lender Party hereunder,
and (iv) the amount of any sum received by the Administrative Agent from
the Borrower hereunder and each Lender Party's share thereof.
(c) Entries made in good faith by the Administrative Agent in the
Register pursuant to subsection (b) above, and by each Lender Party in its
account or accounts pursuant to subsection (a) above, shall be prima facie
evidence of the amount of principal and interest due and payable or to
become due and payable from the Borrower to, in the case of the Register,
each Lender Party and, in the case of such account or accounts, such Lender
Party, under this Agreement, absent manifest error; provided, however, that
the failure of the Administrative Agent or such Lender Party to make an
entry, or any finding that an entry is incorrect, in the Register or such
account or accounts shall not limit or otherwise affect the obligations of
the Borrower under this Agreement.
SECTION 2.17. Mitigation Obligations; Replacement of Lenders. (a) If
any Lender requests compensation under Section 2.10, or if the Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.12, then such
Lender shall use reasonable efforts to designate a different lending office
for funding or booking its Advances hereunder or to assign its rights and
obligations hereunder to another of its offices, branches or affiliates,
if, in the judgment of such Lender, such designation or assignment (i)
would eliminate or reduce amounts payable pursuant to Section 2.10 or 2.12,
as the case may be, in the future and (ii) would not subject such Lender to
any unreimbursed cost or expense and would not otherwise be disadvantageous
to such Lender. The Borrower hereby agrees to pay all reasonable costs and
expenses incurred by any Lender in connection with any such designation or
assignment.
(b) If any Lender requests compensation under Section 2.10, or if the
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section
2.12, or if any Lender is a Defaulting Lender, then the Borrower may, at
its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.07), all of its interests, rights and obligations under this
Agreement to an assignee that shall assume such obligations (which assignee
may be another Lender, if a Lender accepts such assignment); provided that
(i) the Borrower shall have received the prior written consent of the
Administrative Agent (and, if a Revolving Credit Commitment is being
assigned, the Issuing Bank and Swing Line Bank), which consent shall not
unreasonably be withheld, (ii) such Lender shall have received payment of
an amount equal to the outstanding principal of its Advances and
participations in LC Disbursements and Swing Line Advances, accrued
interest thereon, accrued fees and all other amounts payable to it
hereunder, from the assignee (to the extent of such outstanding principal
and accrued interest and fees) or the Borrower (in the case of all other
amounts) and (iii) in the case of any such assignment resulting from a
claim for compensation under Section 2.10 or payments required to be made
pursuant to Section 2.12, such assignment will result in a material
reduction in such
compensation or payments. A Lender shall not be required to make any such
assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the Borrower to
require such assignment and delegation cease to apply.
ARTICLE III
CONDITIONS OF LENDING AND
ISSUANCES OF LETTERS OF CREDIT
SECTION 3.01. Conditions Precedent to Initial Extension of Credit. The
obligation of each Lender to make an Advance or of the Issuing Bank to
issue a Letter of Credit on the occasion of the Initial Extension of Credit
hereunder is subject to the satisfaction of the following conditions
precedent before or concurrently with the Initial Extension of Credit (and
Article II of this Agreement shall become effective on and as of the first
date (the "Effective Date") on which such conditions precedent have been
satisfied):
(a) The Administrative Agent shall have received on or before the
day of the Initial Extension of Credit the following, each dated such
day (unless otherwise specified), in form and substance satisfactory
to the Administrative Agent (unless otherwise specified) and (except
for the Notes) in sufficient copies for each Lender Party:
(i) The Notes payable to the order of the Lenders to the
extent requested by the Lenders pursuant to the terms of Section
2.16.
(ii) A security agreement in substantially the form of
Exhibit D hereto (together with each other security agreement and
security agreement supplement delivered pursuant to Section
5.01(i), in each case as amended, the "Security Agreement"), duly
executed by each Loan Party, together with:
(A) certificates representing the Pledged Shares
referred to therein accompanied by undated stock powers
executed in blank,
(B) proper forms appropriate for filing with the STB
and proper financing statements in form appropriate for
filing under the Uniform Commercial Code of all
jurisdictions that the Administrative Agent may deem
necessary or desirable, in each case, in order to perfect
and protect the first priority liens and security interests
created under the Security Agreement, covering the
Collateral described in the Security Agreement,
(C) completed requests for information, dated on or
before the date of the Initial Extension of Credit, listing
the financing statements referred to in clause (B) above and
all other effective financing statements filed in the
jurisdictions referred to in clause (B) above that name any
Loan Party as debtor, together with copies of such other
financing statements,
(D) evidence of the completion of all other recordings
and filings of or with respect to the Security Agreement
that the Administrative Agent may deem necessary or
desirable in order to perfect and protect the security
interest created thereunder,
(E) evidence of the insurance required by the terms of
this Agreement and endorsements thereto required by the
terms of the Security Agreement,
(F) evidence that all other action that the
Administrative Agent may deem necessary or desirable in
order to perfect and protect the first priority liens and
security interests created under the Security Agreement has
been taken (including, without limitation, receipt of duly
executed payoff letters, UCC-3 termination statements and
landlords' and bailees' waiver and consent agreements).
(iii) Certified copies of the resolutions of the Board of
Directors of each Loan Party approving the Transaction and each
Loan Document to which it is or is to be a party, and of all
documents evidencing other necessary corporate action and
governmental and other third party approvals and consents, if
any, with respect to the Transaction and each Loan Document to
which it is or is to be a party.
(iv) A copy of a certificate of the Secretary of State of
the jurisdiction of incorporation of each Loan Party, dated
reasonably near the date of the Initial Extension of Credit,
certifying (A) as to a true and correct copy of the charter of
such Loan Party and each amendment thereto on file in such
Secretary's office and (B) that (1) such amendments are the only
amendments to such Loan Party's charter on file in such
Secretary's office, (2) such Loan Party has paid all franchise
taxes to the date of such certificate (to the extent the
Secretary of State in the applicable jurisdictions typically
provides such a certification) and (3) such Loan Party is duly
incorporated and in good standing or presently subsisting under
the laws of the State of the jurisdiction of its incorporation.
(v) (i) A certificate of the Secretary or Assistant
Secretary of each Loan Party, countersigned on behalf of such
Loan Party by another officer of such Loan Party, dated the date
of the Initial Extension of Credit (the statements made in which
certificate shall be true on and as of the date of the Initial
Extension of Credit), certifying as to (A) the absence of any
amendments to the charter of such Loan Party since the date of
the Secretary of State's certificate referred to in
Section 3.01(a)(iv) and (B) a true and correct copy of the bylaws
of such Loan Party as in effect on the date of the Initial
Extension of Credit, and (ii) a certificate of the President or a
Vice President of the Borrower, dated the date of the Initial
Extension of Credit (the statements made in which certificate
shall be true on and as of the date of the Initial Extension of
Credit), certifying as to (A) the truth of the representations
and warranties contained in the Loan Documents as though made on
and as of the date of the Initial Extension of Credit
and (B) the absence of any event occurring and continuing, or
resulting from the Initial Extension of Credit, that constitutes
a Default.
(vi) A certificate of the Secretary or an Assistant
Secretary of each Loan Party certifying the names and true
signatures of the officers of such Loan Party authorized to sign
each Loan Document to which it is or is to be a party and the
other documents to be delivered hereunder and thereunder.
(vii) A certificate, in substantially the form of Exhibit F
hereto, attesting to the Solvency of the Loan Parties before and
after giving effect to the Transaction, from the chief financial
officer of the Parent.
(viii) Such financial, business and other information
regarding each Loan Party and its Subsidiaries as the Lender
Parties shall have requested, including, without limitation,
information as to possible contingent liabilities, tax matters,
environmental matters, obligations under Plans, Multiemployer
Plans and Welfare Plans, collective bargaining agreements and
other arrangements with employees, audited annual financial
statements dated December 31, 2002, interim financial statements
dated the end of the most recent fiscal quarter for which
financial statements are available (or, in the event the Lender
Parties' due diligence review reveals material changes since such
financial statements, as of a later date within 45 days of the
day of the Initial Extension of Credit), pro forma financial
statements as to the Parent and forecasts prepared by management
of the Parent, in form and substance satisfactory to the Lender
Parties, of balance sheets, income statements and cash flow
statements on a monthly basis for the first year following the
day of the Initial Extension of Credit and on an annual basis for
each year thereafter until the Termination Date.
(ix) A Notice of Borrowing or Notice of Issuance, as
applicable, relating to the Initial Extension of Credit.
(x) A favorable opinion of Sonnenschein, Nath & Rosenthal
LLP, counsel for the Loan Parties, in substantially the form of
Exhibit G hereto and as to such other matters as any Lender Party
through the Administrative Agent may reasonably request.
(b) The Lender Parties shall be satisfied with the corporate and
legal structure and capitalization of each Loan Party and each of its
Subsidiaries the Equity Interests in which Subsidiaries is being
pledged pursuant to the Loan Documents, including the terms and
conditions of the charter, bylaws and each class of Equity Interest in
each Loan Party and each such Subsidiary and of each agreement or
instrument relating to such structure or capitalization.
(c) The Lender Parties shall be satisfied that all Existing Debt,
other than Surviving Debt, has been prepaid, redeemed or defeased in
full or otherwise satisfied and extinguished and all commitments
relating thereto terminated and that all Surviving Debt shall be on
terms and conditions satisfactory to the Lender Parties.
(d) The Administrative Agent shall have received a pay-off letter
from JPMorgan Chase Bank confirming the amount required to satisfy all
Debt outstanding under the Existing Credit Facility together with an
undertaking to release all Liens securing such facility and otherwise
reasonably satisfactory to the Administrative Agent.
(e) Before giving effect to the Transaction, there shall have
occurred no Material Adverse Change since December 31, 2002.
(f) There shall exist no action, suit, investigation, litigation
or proceeding affecting any Loan Party or any of its Subsidiaries
pending or threatened before any Governmental Authority that (i) could
be reasonably likely to have a Material Adverse Effect or
(ii) purports to affect the legality, validity or enforceability of
any Loan Document or the consummation of the Transaction.
(g) All Governmental Authorizations and third party consents and
approvals necessary in connection with the Transaction shall have been
obtained (without the imposition of any conditions that are not
acceptable to the Lender Parties) and shall remain in effect; all
applicable waiting periods in connection with the Transaction shall
have expired without any action being taken by any competent
authority, and no law or regulation shall be applicable in the
judgment of the Lender Parties, in each case that restrains, prevents
or imposes materially adverse conditions upon the Transaction or the
rights of the Loan Parties or their Subsidiaries freely to transfer or
otherwise dispose of, or to create any Lien on, any properties now
owned or hereafter acquired by any of them.
(h) The Lender Parties shall have completed a due diligence
investigation of the Loan Parties, the Borrower and their respective
Subsidiaries in scope, and with results, satisfactory to the Lender
Parties, and nothing shall have come to the attention of the Lender
Parties during the course of such due diligence investigation to lead
them to believe that the Information Memorandum was or has become
misleading, incorrect or incomplete in any material respect, without
limiting the generality of the foregoing, the Lender Parties shall
have been given such access to the management, records, books of
account, contracts and properties of the Borrower and its Subsidiaries
as they shall have requested.
(i) The Borrower shall have paid all accrued fees of the Agents
and the Lender Parties and all accrued expenses of the Agents
(including the accrued fees and expenses of counsel to the
Administrative Agent.
(j) The Refinancing shall have been consummated or shall be
consummated concurrently with the Initial Extension of Credit and all
obligations under the Existing Credit Agreement shall be terminated.
(k) The Lender Parties shall be satisfied with the nature of and
amount of all existing and potential environmental concerns associated
with the facilities of the Loan Parties, and shall be satisfied with
the Borrower's plans with respect thereto.
SECTION 3.02. Conditions Precedent to Each Borrowing and Issuance and
Renewal. The obligation of each Appropriate Lender to make an Advance
(other than a Letter of Credit
Advance made by the Issuing Bank or a Revolving Credit Lender pursuant to
Section 2.03(c) and a Swing Line Advance made by a Revolving Credit Lender
pursuant to Section 2.02(b)) on the occasion of each Borrowing (including
the initial Borrowing), and the obligation of the Issuing Bank to issue a
Letter of Credit (including the initial issuance) or renew a Letter of
Credit and the right of the Borrower to request a Swing Line Borrowing,
shall be subject to the further conditions precedent that on the date of
such Borrowing or issuance or renewal (a) the following statements shall be
true (and each of the giving of the applicable Notice of Borrowing, Notice
of Swing Line Borrowing, Notice of Issuance or Notice of Renewal and the
acceptance by the Borrower of the proceeds of such Borrowing or of such
Letter of Credit or the renewal of such Letter of Credit shall constitute a
representation and warranty by the Borrower that both on the date of such
notice and on the date of such Borrowing or issuance or renewal such
statements are true):
(i) the representations and warranties contained in each Loan
Document are correct on and as of such date, before and after giving
effect to such Borrowing or issuance or renewal and to the application
of the proceeds therefrom, as though made on and as of such date,
other than any such representations or warranties that, by their
terms, refer to a specific date other than the date of such Borrowing
or issuance or renewal, in which case as of such specific date; and
(ii) no Default has occurred and is continuing, or would result
from such Borrowing or issuance or renewal or from the application of
the proceeds therefrom;
and (b) the Administrative Agent shall have received such other approvals,
opinions or documents as any Appropriate Lender through the Administrative
Agent may reasonably request.
SECTION 3.03. Determinations Under Section 3.01. For purposes of
determining compliance with the conditions specified in Section 3.01, each
Lender Party shall be deemed to have consented to, approved or accepted or
to be satisfied with each document or other matter required thereunder to
be consented to or approved by or acceptable or satisfactory to the Lender
Parties unless an officer of the Administrative Agent responsible for the
transactions contemplated by the Loan Documents shall have received notice
from such Lender Party prior to the Initial Extension of Credit specifying
its objection thereto and, if the Initial Extension of Credit consists of a
Borrowing, such Lender Party shall not have made available to the
Administrative Agent such Lender Party's ratable portion of such Borrowing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of Parent and the
Borrower. Each of Parent and the Borrower represent and warrants as
follows:
(a) Each Loan Party and each of its Subsidiaries (i) is an entity
duly organized, validly existing and in good standing under the laws
of the jurisdiction of its organization, (ii) is duly qualified and in
good standing as a foreign entity in each other jurisdiction in which
it owns or leases property or in which the conduct of its business
requires it to so qualify or be licensed except where the failure to
so qualify or be licensed would not be reasonably likely to have a
Material Adverse Effect and (iii) has all requisite power and
authority (including, without limitation, all Governmental
Authorizations to own or lease and operate its properties and to carry
on its business as now conducted and as proposed to be conducted. All
of the outstanding Equity Interests in the Borrower have been validly
issued, are fully paid and non-assessable and are owned by the Parent
free and clear of all Liens, except those created under the Collateral
Documents.
(b) Set forth on Schedule 4.01(b) hereto is a complete and
accurate list of all Subsidiaries of each Loan Party, showing as of
the date hereof (as to each such Subsidiary) the jurisdiction of its
incorporation, the number of shares of each class of its Equity
Interests authorized, and the number outstanding, on the date hereof
and the percentage of each such class of its Equity Interests owned by
such Loan Party at the date hereof. All of the outstanding Equity
Interests in each Loan Party's Subsidiaries that are subject to the
Security Agreement have been validly issued, are fully paid and
non-assessable and are owned by such Loan Party or one or more of its
Subsidiaries free and clear of all Liens, except those created under
the Collateral Documents.
(c) The execution, delivery and performance by each Loan Party of
each Loan Document to which it is or is to be a party, and the
consummation of the Transaction, are within such Loan Party's powers,
have been duly authorized by all necessary corporate or other action,
and do not (i) contravene such Loan Party's organizational documents,
(ii) violate any law, rule, regulation (including, without limitation,
Regulation X of the Board of Governors of the Federal Reserve System
and any provision of the Interstate Commerce Act and the Railway Labor
Act), order, writ, judgment, injunction, decree, determination or
award, (iii) conflict with or result in the breach of, or constitute a
default or require any payment to be made under, any contract, loan
agreement, indenture, mortgage, deed of trust, lease or other
instrument binding on or affecting any Loan Party, any of its
Subsidiaries or any of their properties or (iv) except for the Liens
created under the Loan Documents, result in or require the creation or
imposition of any Lien upon or with respect to any of the properties
of any Loan Party or any of its Subsidiaries. No Loan Party or any of
its Subsidiaries is in violation of any such law, rule, regulation,
order, writ, judgment, injunction, decree, determination or award or
in breach of any such contract, loan agreement, indenture, mortgage,
deed of trust, lease or other instrument, the violation or breach of
which could be reasonably likely to have a Material Adverse Effect.
(d) No Governmental Authorization, and no notice to or filing
with, any Governmental Authority or any other third party is required
for (i) the due execution, delivery, recordation, filing or
performance by any Loan Party of any Loan Document to which it is or
is to be a party, or for the consummation of the Transaction, (ii) the
grant by any Loan Party of the Liens granted by it pursuant to the
Collateral Documents, (iii) the perfection or maintenance of the Liens
created under the Collateral Documents (including the first priority
nature thereof) or (iv) the exercise by any Agent or any Lender Party
of its rights under the Loan Documents or the remedies in respect of
the Collateral pursuant to the Collateral Documents, except for the
authorizations, approvals,
actions, notices and filings listed on Schedule 4.01(d) hereto, all of
which have been duly obtained, taken, given or made and are in full
force and effect. All applicable waiting periods in connection with
the Transaction have expired without any action having been taken by
any competent authority restraining, preventing or imposing materially
adverse conditions upon the Transaction or the rights of the Loan
Parties or their Subsidiaries freely to transfer or otherwise dispose
of, or to create any Lien on, any properties now owned or hereafter
acquired by any of them.
(e) This Agreement has been, and each other Loan Document when
delivered hereunder will have been, duly executed and delivered by
each Loan Party party thereto. This Agreement is, and each other Loan
Document when delivered hereunder will be, the legal, valid and
binding obligation of each Loan Party party thereto, enforceable
against such Loan Party in accordance with its terms.
(f) There is no action, suit, investigation, litigation or
proceeding affecting any Loan Party or any of its Subsidiaries,
including any Environmental Action, pending or threatened before any
Governmental Authority or arbitrator that (i) could be reasonably
likely to have a Material Adverse Effect or (ii) purports to affect
the legality, validity or enforceability of any Loan Document or the
consummation of the Transaction.
(g) The Consolidated balance sheet of the Parent and its subsidiaries
as at December 31, 2002, and the related Consolidated statement of
income and Consolidated statement of cash flows of the Parent and its
subsidiaries for the fiscal year then ended, accompanied by an
unqualified opinion of KPMG LLP, independent public accountants, and
the Consolidated balance sheet of Parent and its subsidiaries as at
September 30, 2003, and the related Consolidated statement of income
and Consolidated statement of cash flows of the Parent and its
subsidiaries for the nine months then ended, duly certified by the
chief financial officer of the Parent, copies of which have been
furnished to each Lender Party, fairly present, subject, in the case
of said balance sheet as at September 30, 2003, and said statements of
income and cash flows for the nine months then ended, to year-end
audit adjustments, the Consolidated financial condition of the Parent
and its subsidiaries as at such dates and the Consolidated results of
operations of the Parent and its subsidiaries for the periods ended on
such dates, all in accordance with GAAP applied on a consistent basis,
and since December 31, 2002, there has been no Material Adverse
Change.
(h) The Consolidated pro forma balance sheet of Parent and its
subsidiaries as at September 30, 2003, and the related Consolidated
pro forma statements of income and cash flows of Parent and its
subsidiaries for the nine months then ended, certified by the chief
financial officer of the Parent, copies of which have been furnished
to each Lender Party, fairly present the Consolidated pro forma
financial condition of the Parent and its subsidiaries as at such date
and the Consolidated pro forma results of operations of the Parent and
its subsidiaries for the period ended on such date, in each case
giving effect to the Transaction, all in accordance with GAAP.
(i) The Consolidated forecasted balance sheet, statement of
income and statement of cash flows of Parent and its subsidiaries
delivered to the Lender Parties pursuant to
Section 3.01(a)(viii) or 5.03 were prepared in good faith on the basis
of the assumptions stated therein, which assumptions were fair in
light of the conditions existing at the time of delivery of such
forecasts, and represented, at the time of delivery, the Parent's best
estimate of its future financial performance.
(j) Neither the Information Memorandum nor any other information,
exhibit or report furnished by or on behalf of any Loan Party to any
Agent or any Lender Party in connection with the negotiation and
syndication of the Loan Documents or pursuant to the terms of the Loan
Documents contained any untrue statement of a material fact or omitted
to state a material fact necessary to make the statements made therein
not misleading.
(k) The Borrower is not engaged in the business of extending
credit for the purpose of purchasing or carrying Margin Stock, and no
proceeds of any Advance or drawings under any Letter of Credit will be
used to purchase or carry any Margin Stock or to extend credit to
others for the purpose of purchasing or carrying any Margin Stock.
(l) Neither any Loan Party nor any of its Subsidiaries is an
"investment company", or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company", as such terms
are defined in the Investment Company Act of 1940, as amended. Neither
any Loan Party nor any of its Subsidiaries is a "holding company", or
a "subsidiary company" of a "holding company", or an "affiliate" of a
"holding company" or of a "subsidiary company" of a "holding company",
as such terms are defined in the Public Utility Holding Company Act of
1935, as amended. Neither the making of any Advances, nor the issuance
of any Letters of Credit, nor the application of the proceeds or
repayment thereof by the Borrower, nor the consummation of the other
transactions contemplated by the Loan Documents, will violate any
provision of any such Act or any rule, regulation or order of the
Securities and Exchange Commission thereunder.
(m) Neither any Loan Party nor any of its Subsidiaries is a party
to any indenture, loan or credit agreement or any lease or other
agreement or instrument or subject to any charter or corporate
restriction that could be reasonably likely to have a Material Adverse
Effect.
(n) Upon the filings of the Mortgages in accordance with the
terms of the Loan Documents and the delivery of Account Control
Agreements in accordance with the terms of the Loan Documents, all
filings and other actions necessary or desirable to perfect and
protect the security interest in the Collateral created under the
Collateral Documents have been duly made or taken and are in full
force and effect, and the Collateral Documents create in favor of the
Collateral Agent for the benefit of the Secured Parties a valid and,
together with such filings and other actions, perfected security
interest in the Collateral, securing the payment of the Secured
Obligations. The Loan Parties are the legal and beneficial owners of
the Collateral free and clear of any Lien, except for the liens and
security interests created or permitted under the Loan Documents.
(o) Each Loan Party is, individually and together with its
Subsidiaries, Solvent.
(p) No ERISA Event has occurred or is reasonably expected to
occur that, when taken together with all other such ERISA Events for
which liability is reasonably expected to occur, could reasonably be
expected to result in a Material Adverse Effect. The present value of
all accumulated benefit obligations under each Plan (based on the
assumptions used for purposes of Statement of Financial Accounting
Standards No. 87) did not, as of the date of the most recent financial
statements reflecting such amounts, exceed by more than $10,000,000
the fair market value of the assets of such Plan, and the present
value of all accumulated benefit obligations of all underfunded Plans
(based on the assumptions used for purposes of Statement of Financial
Accounting Standards No. 87) did not, as of the date of the most
recent financial statements reflecting such amounts, exceed by more
than $20,000,000 the fair market value of the assets of all such
underfunded Plans.
(q) Except as otherwise set forth on Schedule 4.01(q) hereto or
as disclosed in Parent's Annual Report on Form 10-K for the fiscal
year ended December 31, 2002, filed with the Securities and Exchange
Commission and except with respect to any other matters that,
individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect, neither Parent, the Borrower nor
any other Subsidiary (i) has failed to comply with any Environmental
Law or to obtain, maintain or comply with any permit, license or other
approval required under any Environmental Law, (ii) has become subject
to any Environmental Liability, (iii) has received notice of any claim
with respect to any Environmental Liability or (iv) to the best
knowledge and belief of Parent and the Borrower, knows of any basis
for any Environmental Liability.
(r) (i) As of the date hereof, neither any Loan Party nor any of
its Subsidiaries is party to any tax sharing agreement relating to
current or future Fiscal Years.
(ii) Each of Parent and the Subsidiaries has timely filed or
caused to be filed all Tax returns and reports required to have been
filed and has paid or caused to be paid all Taxes required to have
been paid by it, except (a) any Taxes that are being contested in good
faith by appropriate proceedings and for which Parent or such
Subsidiary, as applicable, has set aside on its books adequate
reserves or (b) to the extent that the failure to do so could not
reasonably be expected to result in a Material Adverse Effect.
(s) Set forth on Schedule 4.01(s) hereto is a complete and
accurate list as of the date hereof of all Existing Debt (other than
Surviving Debt), showing the obligor and the principal amount
outstanding thereunder.
(t) Set forth on Schedule 4.01(t) hereto is a complete and
accurate list as of the date hereof of all Surviving Debt (other than
Surviving Debt consisting of intercompany Debt between Loan Parties),
showing the obligor and the principal amount outstanding thereunder,
the maturity date thereof and the amortization schedule therefor.
(u) Set forth on Schedule 4.01(u) hereto is a complete and
accurate list of all Liens on the property or assets of any Loan Party
or any of its Subsidiaries as of the date
hereof, showing as of the date hereof the lienholder thereof, the
principal amount of the obligations secured thereby and the property
or assets of such Loan Party or such Subsidiary subject thereto.
(v) Set forth on Schedule 4.01(v) hereto as of the date hereof is
a complete and accurate list of all major real property owned by any
Loan Party or any of its Subsidiaries, showing as of the date hereof
the common name, county or other relevant jurisdiction, state, record
owner and a value (as reasonably determined by the Borrower and
approved by the Administrative Agent) thereof. Each Loan Party or such
Subsidiary has good, marketable and insurable fee simple title to such
real property, free and clear of all Liens, other than Liens created
or permitted by the Loan Documents.
(w) (i) Set forth on Schedule 4.01(w)(i) hereto as of the date
hereof is a complete and accurate list of all major leases of real
property under which any Loan Party or any of its Subsidiaries is the
lessee, showing as of the date hereof the common name, county or other
relevant jurisdiction, state, lessor and the lessee thereof.
(ii) Set forth on Schedule 4.01(w)(ii) hereto as of the date
hereof is a complete and accurate list of all major leases of real
property under which any Loan Party is the lessor, showing as of the
date hereof the common name, county or other relevant jurisdiction,
state, lessor, lessee and a value (as reasonably determined by the
Borrower and approved by the Administrative Agent) thereof.
(x) Set forth on Schedule 4.01(x) hereto as of the date hereof is
a complete and accurate list of all Investments in excess of $1
million held by any Loan Party or any of its Subsidiaries on the date
hereof (other than Investments in Subsidiaries and other than
Investments in Cash Equivalents), showing as of the date hereof the
amount, obligor or issuer and maturity, if any, thereof.
(y) Set forth on Schedule 4.01(y) hereto as of the date hereof is
a complete and accurate list of all patents, trademarks, trade names,
service marks and copyrights, and all applications therefor and
licenses thereof which are registered and material to the business of
any Loan Party or any of its Subsidiaries, showing as of the date
hereof the jurisdiction in which registered, the registration number,
the date of registration and the expiration date.
ARTICLE V
COVENANTS OF THE BORROWEr and parent
SECTION 5.01. Affirmative Covenants. So long as any Advance or any
other Obligation of any Loan Party under any Loan Document shall remain
unpaid, any Letter of Credit shall be outstanding or any Lender Party shall
have any Commitment hereunder, each of Parent and the Borrower will:
(a) Compliance with Laws, Etc. Comply, and cause each of their
Subsidiaries to comply, in all material respects, with all applicable
laws, rules, regulations and orders,
such compliance to include, without limitation, compliance with ERISA,
Environmental Laws, the Racketeer Influenced and Corrupt Organizations
Chapter of the Organized Crime Control Act of 1970, the Interstate
Commerce Act and the Railway Labor Act except where the failure to do
so could not reasonably be expected to have a Material Adverse Effect.
(b) Payment of Taxes, Etc. Pay and discharge, and cause each of
their Subsidiaries to pay and discharge, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges or
levies imposed upon it or upon its property and (ii) all lawful claims
that, if unpaid, might by law become a Lien upon its property;
provided, however, that neither the Parent, the Borrower nor any of
their Subsidiaries shall be required to pay or discharge any such tax,
assessment, charge or claim that is being contested in good faith and
by proper proceedings and as to which appropriate reserves are being
maintained, unless and until any Lien resulting therefrom attaches to
its property and becomes enforceable against its other creditors.
(c) Maintenance of Insurance. Maintain, and cause each of their
Subsidiaries to maintain, insurance with responsible and reputable
insurance companies or associations in such amounts and covering such
risks as is usually carried by companies engaged in similar businesses
and owning similar properties in the same general areas in which the
Parent, the Borrower or such Subsidiary operates.
(d) Preservation of Corporate Existence, Etc. Preserve and
maintain, and cause each of their Subsidiaries to preserve and
maintain, its existence, legal structure, legal name, rights (charter
and statutory), permits, licenses, approvals, privileges and
franchises; provided, however, that the Parent, the Borrower and their
Subsidiaries may consummate any merger or consolidation permitted
under Section 5.02(d) and provided further that neither the Parent,
the Borrower nor any of their Subsidiaries shall be required to
preserve any right, permit, license, approval, privilege or franchise
if the Board of Directors of the Parent, the Borrower or such
Subsidiary shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Parent, the Borrower
or such Subsidiary, as the case may be, and that the loss thereof is
not disadvantageous in any material respect to the Parent, the
Borrower, such Subsidiary or the Lender Parties.
(e) Visitation Rights. At any reasonable time and from time to
time, upon reasonable notice, permit any of the Agents or any of the
Lender Parties, or any agents or representatives thereof, to examine
and make copies of and abstracts from the records and books of account
of, and visit the properties of, the Parent, the Borrower and any of
their Subsidiaries, and to discuss the affairs, finances and accounts
of the Parent, the Borrower and any of their Subsidiaries with any of
their officers or directors provided that any such examinations shall
be at the Lender's sole expense and the Lenders shall coordinate the
timing of their visits through the Administrative Agent.
(f) Keeping of Books. Keep, and cause each of their Subsidiaries
to keep, proper books of record and account, in which full and correct
entries shall be made of all
financial transactions and the assets and business of the Parent, the
Borrower and each such Subsidiary in accordance with GAAP in effect
from time to time.
(g) Maintenance of Properties, Etc. Maintain and preserve, and
cause each of their Subsidiaries to maintain and preserve, all of its
properties that are used or useful in the conduct of its business in
good working order and condition, ordinary wear and tear excepted.
(h) Transactions with Affiliates. Conduct, and cause each of
their Subsidiaries to conduct, all transactions otherwise permitted
under the Loan Documents with any of their Affiliates on terms that
are fair and reasonable and no less favorable to Parent, the Borrower
or such Subsidiary than it would obtain in a comparable arm's-length
transaction with a Person not an Affiliate.
(i) Covenant to Guarantee Obligations and Give Security. Upon (x)
the formation or acquisition of any Significant Subsidiary by any Loan
Party or (y) the acquisition of any material property by any Loan
Party, and such property, in the judgment of the Collateral Agent,
shall not already be subject to a perfected first priority security
interest in favor of the Collateral Agent for the benefit of the
Secured Parties, then in each case at the Borrower's expense:
(i) in connection with the formation or acquisition of a
Significant Subsidiary, within 30 days after such formation or
acquisition, cause each such Subsidiary, and cause each direct
and indirect parent of such Subsidiary (if it has not already
done so), to duly execute and deliver to the Collateral Agent a
guaranty or guaranty supplement, in form and substance
satisfactory to the Collateral Agent, guaranteeing the other Loan
Parties' obligations under the Loan Documents,
(ii) within 30 days after such formation or acquisition,
furnish to the Collateral Agent a description of the real and
personal properties of such Subsidiary or the real and personal
properties so acquired, in each case in detail satisfactory to
the Collateral Agent,
(iii) within 60 days after (A) such acquisition of any
material property by any Loan Party, duly execute and deliver,
and cause the applicable Loan Party to duly execute and deliver,
to the Collateral Agent such additional mortgages, pledges,
assignments, security agreement supplements, intellectual
property security agreement supplements and other security
agreements as reasonably requested by, and in form and substance
reasonably satisfactory to the Collateral Agent, securing payment
of all the Obligations of such Loan Party under the Loan
Documents and constituting Liens on all such properties and (B)
formation or acquisition of any new Significant Subsidiary, cause
such Significant Subsidiary to duly execute and deliver to the
Collateral Agent mortgages, pledges, assignments, security
agreement supplements, intellectual property security agreement
supplements and other security agreements as reasonably requested
by, and in form and substance satisfactory to the Collateral
Agent, securing payment
of all of the obligations of such Subsidiary under the Loan
Documents, and cause the applicable Loan Party and each such
Significant Subsidiary to take, whatever action may be reasonably
necessary or advisable in the opinion of the Collateral Agent to
vest in the Collateral Agent (or in any representative of the
Collateral Agent designated by it) valid and subsisting Liens on
the properties purported to be subject to the mortgages, pledges,
assignments, security agreement supplements, intellectual
property security agreement supplements and security agreements
delivered pursuant to this Section 5.01(i), enforceable against
all third parties in accordance with their terms,
(iv) within 60 days after such formation or acquisition,
deliver to the Collateral Agent, upon the reasonable request of
the Collateral Agent, a signed copy of a favorable opinion,
addressed to the Collateral Agent and the other Secured Parties,
of counsel for the Loan Parties acceptable to the Collateral
Agent as to (1) the matters contained in clauses (i) and (iii)
above, (2) such guaranties, guaranty supplements, mortgages,
pledges, assignments, security agreement supplements,
intellectual property security agreement supplements and security
agreements being legal, valid and binding obligations of each
Loan Party party thereto enforceable in accordance with their
terms, (3) any recordings, filings, notices, endorsements and
other actions taken pursuant thereto being sufficient to create
valid perfected Liens on such properties, and (4) such other
matters as the Collateral Agent may reasonably request,
(v) as promptly as practicable after such request, formation or
acquisition, deliver, upon the request of the Collateral Agent in
its reasonable credit judgment, to the Collateral Agent with
respect to each parcel of real property with a value in excess of
$500,000 owned or held by the applicable Loan Party and each
newly acquired or newly formed Significant Subsidiary title
reports, surveys and engineering, soils and other reports, and
environmental assessment reports, each in scope, form and
substance reasonably satisfactory to the Collateral Agent,
provided, however, that to the extent that any Loan Party or any
of its Subsidiaries shall have otherwise received any of the
foregoing items with respect to such real property, such items
shall, promptly after the receipt thereof, be delivered to the
Collateral Agent, and
(vi) at any time and from time to time, promptly execute and
deliver, and cause to execute and deliver, each Loan Party and
each newly acquired or newly formed Significant Subsidiary any
and all further instruments and documents and take, and cause
each Loan Party and each newly acquired or newly formed
Significant Subsidiary to take, all such other action as the
Collateral Agent may deem reasonably necessary or desirable to
obtain the full benefits of, or in perfecting and preserving the
Liens of, such guaranties, mortgages, pledges, assignments,
security agreement supplements, intellectual property security
agreement supplements and security agreements; provided, however,
that nothing in this clause (i) shall require the creation or
perfection of pledges or security interests in particular assets
of the Loan Parties if the Collateral Agent shall have determined
that the cost of creation and perfection of
such pledges or security interests is excessive in view of the
benefit to be obtained by the Lenders.
(j) Further Assurances. (i) Promptly upon request by any Agent,
or any Lender Party through the Administrative Agent, correct, and
cause each of their Subsidiaries promptly to correct, any material
defect or error that may be discovered in any Loan Document or in the
execution, acknowledgment, filing or recordation thereof, and
(ii) Promptly upon request by any Agent, or any Lender Party
through the Administrative Agent, do, execute, acknowledge, deliver,
record, re-record, file, re-file, register and re-register any and all
such further acts, deeds, conveyances, pledge agreements, mortgages,
deeds of trust, trust deeds, assignments, financing statements and
continuations thereof, termination statements, notices of assignment,
transfers, certificates, assurances and other instruments as any
Agent, or any Lender Party through the Administrative Agent, may
reasonably require from time to time in order to (A) carry out more
effectively the purposes of the Loan Documents, (B) to the fullest
extent permitted by applicable law, subject any Loan Party's or any of
its Subsidiaries' properties, assets, rights or interests to the Liens
now or hereafter intended to be covered by any of the Collateral
Documents, (C) perfect and maintain the validity, effectiveness and
priority of any of the Collateral Documents and any of the Liens
intended to be created thereunder and (D) assure, convey, grant,
assign, transfer, preserve, protect and confirm more effectively unto
the Secured Parties the rights granted or now or hereafter intended to
be granted to the Secured Parties under any Loan Document or under any
other instrument executed in connection with any Loan Document to
which any Loan Party or any of its Subsidiaries is or is to be a
party, and cause each of its Subsidiaries to do so.
(k) Delivery of Environmental Reports. Promptly provide to the
Administrative Agent or the Collateral Agent, at the expense of the
Borrower, copies of any environmental site assessment report for the
Parent, the Borrower or any of their Subsidiaries' properties
described in the Mortgages, indicating the presence or absence of
Hazardous Materials in any material respect and the estimated cost of
any compliance, removal or remedial action in connection with any
Hazardous Materials on such properties.
(l) Account Control Agreements. By the date that is 30 days after
the Effective Date, as such time period may be extended in the
Administrative Agent's sole discretion, the Administrative agent shall
have received the Account Control Agreements referred to in the
Security Agreement, duly executed by each Pledged Account Bank
referred to in the Security Agreement, in form and substance
satisfactory to the Administrative Agent.
(m) Securities Account Control Agreements. By the date that is 10
days after the Effective Date, as such time period may be extended in
the Administrative Agent's sole discretion, the Administrative Agent
shall have received the Securities Account Control Agreement referred
to in the Security Agreement, duly executed by each Pledged
Account Bank referred to in the Security Agreement, in form and
substance satisfactory to the Administrative Agent.
(n) Mortgages. By the date that is 45 days after the Effective
Date, as such time period may be extended in the Administrative
Agent's reasonable discretion, the Borrower shall deliver deeds of
trust, trust deeds, mortgages, leasehold mortgages and leasehold deeds
of trust in substantially the form of Exhibit E hereto (with such
changes as may be satisfactory to the Administrative Agent and its
counsel to account for local law matters) and otherwise in form and
substance satisfactory to the Administrative Agent and covering the
Properties (together with each other mortgage delivered pursuant to
Section 5.01(i), in each case as amended, the "Mortgages"), duly
executed by the appropriate Loan Party, together with:
(A) evidence that counterparts of the Mortgages have been
either (x) duly recorded, or (y) duly executed, acknowledged and
delivered in form suitable for filing or recording, in all filing
or recording offices that the Administrative Agent may deem
necessary or desirable in order to create a valid first and
subsisting Lien on the property described therein in favor of the
Collateral Agent for the benefit of the Secured Parties and that
all filing and recording taxes and fees have been paid,
(B) with respect to those Properties listed on Schedule
4.01(w)(iii), fully paid American Land Title Association Lender's
Extended Coverage title insurance policies (the "Mortgage
Policies") in form and substance, with endorsements and in amount
acceptable to the Administrative Agent, issued, coinsured and
reinsured by title insurers acceptable to the Administrative
Agent, insuring the Mortgages on such Properties to be valid
first and subsisting Liens on the property described therein,
free and clear of all defects (including, but not limited to,
mechanics' and materialmen's Liens) and encumbrances, excepting
only Permitted Liens and Permitted Encumbrances, and providing
for such other affirmative insurance (including endorsements for
future advances under the Loan Documents and for mechanics' and
materialmen's Liens) and such coinsurance and direct access
reinsurance as the Administrative Agent may deem necessary or
desirable; provided, that, the Loan Parties will not be required
to provide title insurance or surveys as described in clause (C)
below if the Administrative Agent shall have determined that the
cost of obtaining such title insurance or surveys shall be
excessive in view of the benefit to be obtained by the Lenders,
(C) with respect to those Properties listed on Schedule
4.01(w)(iv), American Land Title Association/American Congress on
Surveying and Mapping form surveys, for which all necessary fees
(where applicable) have been paid, and dated no more than the
date that is 30 days before the day of the Initial Extension of
Credit, certified to the Administrative Agent, the Collateral
Agent and the issuer of the Mortgage Policies in a manner
satisfactory to the Administrative Agent by a land
surveyor duly registered and licensed in the States in which the
property described in such surveys is located and acceptable to
the Administrative Agent, showing all buildings and other
improvements, any off-site improvements, the location of any
easements, parking spaces, rights of way, building set-back lines
and other dimensional regulations and the absence of
encroachments, either by such improvements or on to such
property, and other defects, other than encroachments and other
defects acceptable to the Administrative Agent,
(D) evidence of the insurance required by the terms of the
Mortgages,
(E) favorable opinions of local counsel for the Loan Parties
(i) in states in which the Properties are located, in
substantially the form of Exhibit H hereto and otherwise in form
and substance satisfactory to the Administrative Agent and (ii)
in states in which the Loan Parties party to the Mortgages are
organized or formed, with respect to the valid existence,
corporate power and authority of such Loan Parties in the
granting of the Mortgages, in form and substance satisfactory to
the Administrative Agent (or, in the case of those entities
organized in Delaware, a satisfactory opinion of Sonnenschein,
Nath & Rosenthal LLP).
(F) such other consents, agreements and confirmations of
lessors and third parties as the Administrative Agent may
reasonably deem necessary or desirable and evidence that all
other actions that the Administrative Agent may reasonably deem
necessary or desirable in order to create valid first and
subsisting Liens on the property described in the Mortgages has
been taken.
(o) Schedule of Accounts. By the date that is 5 days after the
Effective Date, provide the schedules of Account Collateral (as such
term is defined in the Security Agreement) required under the Security
Agreement.
SECTION 5.02. Negative Covenants. So long as any Advance or any other
Obligation of any Loan Party under any Loan Document shall remain unpaid,
any Letter of Credit shall be outstanding or any Lender Party shall have
any Commitment hereunder, each of the Parent and the Borrower will not, at
any time:
(a) Liens, Etc. Create, incur, assume or suffer to exist, or
permit any of their Subsidiaries to create, incur, assume or suffer to
exist, any Lien on or with respect to any of its properties of any
character (including, without limitation, accounts) whether now owned
or hereafter acquired, or sign or file or suffer to exist, or permit
any of its Subsidiaries to sign or file or suffer to exist, under the
Uniform Commercial Code of any jurisdiction or with the STB, a
financing statement or other filing that names the Parent, the
Borrower or any of their Subsidiaries as debtor (other than any filing
made by a lessor of property solely for protective purposes), or sign
or suffer to exist, or permit any of their Subsidiaries to sign or
suffer to exist, any security agreement authorizing any
secured party thereunder to file such financing statement or other
filing, or assign, or permit any of their Subsidiaries to assign, any
accounts or other right to receive income, except:
(i) Liens created under the Loan Documents;
(ii) Permitted Liens;
(iii) Liens existing on the date hereof and described on
Schedule 4.01(u) hereto;
(iv) purchase money Liens upon or in real property or
equipment acquired or held by the Borrower or any of its
Subsidiaries in the ordinary course of business to secure the
purchase price of such property or equipment or to secure Debt
incurred solely for the purpose of financing the acquisition,
construction or improvement of any such property or equipment to
be subject to such Liens, or Liens existing on any such property
or equipment at the time of acquisition (other than any such
Liens created in contemplation of such acquisition that do not
secure the purchase price), or extensions, renewals or
replacements of any of the foregoing for the same or a lesser
amount; provided, however, that no such Lien shall extend to or
cover any property other than the property or equipment being
acquired, constructed or improved, and no such extension, renewal
or replacement shall extend to or cover any property not
theretofore subject to the Lien being extended, renewed or
replaced; and provided further that the Debt secured by Liens
permitted by this clause (iv) shall be permitted under Section
5.02(b)(i)(H);
(v) Liens arising in connection with Capitalized Lease
Obligations permitted under Section 5.02(b)(i)(H); provided that
no such Lien shall extend to or cover any Collateral or assets
other than the assets subject to such Capitalized Lease
Obligations;
(vi) Liens on property of a Person existing at the time such
Person is merged into or consolidated with the Parent, the
Borrower or any of their Subsidiaries or becomes a Subsidiary of
the Parent or Borrower; provided that such Liens were not created
in contemplation of such merger, consolidation or investment and
do not extend to any assets other than those of the Person merged
into or consolidated with the Parent, the Borrower or such
Subsidiary or acquired by the Parent, the Borrower or such
Subsidiary;
(vii) to the extent any Securitization Transaction is not
structured as a true sale of accounts receivable, Liens existing
or deemed to exist in connection with such Securitization
Transactions; provided, that any outstanding Term B Advances
shall be prepaid to the extent required under Section 2.06; and
(viii) Liens not expressly permitted by clauses (i) through
(vi); provided that the sum of (A) the aggregate principal amount
of the outstanding Debt of Parent and its Subsidiaries secured by
Liens permitted by this clause and (B) the
Attributable Debt in connection with all Sale and Leaseback
Transactions of Parent and its Subsidiaries permitted by Section
5.02(h)(iii) does not at any time exceed 10% of Consolidated Net
Worth.
(b) Debt. Create, incur, assume or suffer to exist, or permit any
of its Subsidiaries to create, incur, assume or suffer to exist, any
Debt and Off Balance Sheet Obligations, except:
(i) in the case of the Parent, the Borrower and any of their
respective Subsidiaries,
(A) Debt under the Loan Documents;
(B) the Surviving Debt, and any Debt extending the
maturity of, or refunding or refinancing, in whole or in
part, any Surviving Debt, provided that the principal amount
of such Surviving Debt shall not be increased above the
principal amount thereof outstanding immediately prior to
such extension, refunding or refinancing, and the direct and
contingent obligors therefor shall not be changed, as a
result of or in connection with such extension, refunding or
refinancing, provided further that the terms relating to
principal amount, amortization, maturity, collateral (if
any) and subordination (if any), and other material terms
taken as a whole, of any such extending, refunding or
refinancing Debt, and of any agreement entered into and of
any instrument issued in connection therewith, are no less
favorable in any material respect to the Loan Parties or the
Lender Parties than the terms of any agreement or instrument
governing the Surviving Debt being extended, refunded or
refinanced;
(C) Debt of Parent or the Borrower as an account party
in respect of letters of credit (which do not constitute
Letters of Credit hereunder) in an aggregate stated amount
at any time outstanding not in excess of $5,000,000;
(D) Debt owed to the Parent, the Borrower, or any
Subsidiary of the Parent which Debt shall, if such Debt is
owed to a Person that is not a Loan Party, include
subordination terms acceptable to the Administrative Agent
to the extent the aggregate amount of such Debt exceeds $10
million;
(E) Debt of any Person that becomes a Subsidiary of the
Borrower or the Parent after the date hereof in accordance
with the terms of Section 5.02(f) which Debt is existing at
the time such Person becomes a Subsidiary of the Borrower or
the Parent (other than Debt incurred solely in contemplation
of such Person becoming a Subsidiary of the Borrower or the
Parent);
(F) Securitization Transactions;
(G) Debt incurred in connection with the closing of the
Grupo TFM Acquisition that is canceled or extinguished as
part of such closing;
(H) Any other Debt, provided that before and after
giving effect to the incurrence of such Debt (i) the ratio
of Senior Secured Debt to EBITDA is less than 2.50:1.00 and
(ii) the Loan Parties are otherwise in compliance with the
financial covenants set forth in Section 5.04 and provided
further that, if such Debt is unsecured, (a) in no event
shall the terms of such Debt require any amortization prior
to the Termination Date, (b) a Subsidiary shall not
guarantee such Debt unless (i) such Subsidiary is also a
Subsidiary Guarantor under this Agreement, and (ii) such
guarantee of such Debt provides for the release and
termination thereof, without action by any party, upon any
release and termination of such Subsidiary Guaranty by the
applicable Subsidiary (other than by reason of repayment and
satisfaction of all of the Obligations);
(I) Debt consisting of guaranties described in
5.02(b)(i)(H); and
(ii) Parent will not permit SCC Holdings, Inc. to create,
incur, assume or permit to exist any Debt;
(iii) Neither Parent nor the Borrower will, nor will they
permit any Subsidiary to, issue any preferred stock or other
Preferred Interests other than Preferred Interests of Parent that
are not by their terms or by the terms of any agreement or
instrument subject to any redemption, repurchase or similar
requirement for the payment of cash, whether absolute, at the
option of any holder thereof or upon the occurrence of any event
or contingency (other than an event which results in an Event of
Default hereunder) which could occur prior to the final maturity
of all the Advances; and
(iv) Parent will not permit Caymex or any other domestic
wholly owned subsidiary of the Parent that directly or indirectly
owns the Equity Interests of Grupo TFM to create, incur or assume
any Debt other than Debt the proceeds of which are used to
finance or refinance its foreign operations in Mexico and Panama
or to make distributions to the Parent.
(c) Change in Nature of Business. Make, or permit any of their
Subsidiaries to make, any material change in the nature of its
business as carried on at the date hereof.
(d) Mergers, Etc. Merge into or consolidate with any Person or
permit any Person to merge into Parent or the Borrower, or permit any
of their Subsidiaries to do so, except that:
(i) any Subsidiary of Parent or the Borrower may merge into
or consolidate with the Parent, any other Subsidiary of Parent or
the Borrower, provided that, in the case of any such merger or
consolidation, the Person formed by such merger or consolidation
shall be an Affiliate of the Parent or the
Borrower which is also a Loan Party, provided further that, in
the case of any such merger or consolidation to which a
Subsidiary Guarantor is a party, the Person formed by such merger
or consolidation shall be a Subsidiary Guarantor;
(ii) in connection with any acquisition permitted under
Section 5.02(f), any Subsidiary of the Parent or the Borrower may
merge into or consolidate with any other Person or permit any
other Person to merge into or consolidate with it; provided that
the Person surviving such merger shall be an Affiliate of the
Parent or the Borrower which is also a Loan Party; and
(iii) in connection with any sale or other disposition
permitted under Section 5.02(e) (other than clause (ii) thereof),
any Subsidiary of the Parent may merge into or consolidate with
any other Person or permit any other Person to merge into or
consolidate with it;
provided, however, that in each case, immediately before and after
giving effect thereto, no Default shall have occurred and be
continuing.
(e) Sales, Etc., of Assets. Sell, lease, transfer or otherwise
dispose of, or permit any of its Subsidiaries to sell, lease, transfer
or otherwise dispose of, any assets, or grant any option or other
right to purchase, lease or otherwise acquire any assets, except:
(i) sales of Inventory, used or surplus equipment,
non-operating assets and non-income producing assets and Cash
Equivalents in the ordinary course of its business and the
granting of any option or other right to purchase, lease or
otherwise acquire Inventory in the ordinary course of its
business;
(ii) in a transaction authorized by Section 5.02(d);
(iii) sales, transfers or other dispositions of assets among
Loan Parties;
(iv) other sales, transfers or other dispositions of assets;
provided that (i) the Net Cash Proceeds from any such sale,
transfer or other disposition are paid to the Lenders to the
extent required by Section 2.06(b) and (ii) such assets are sold,
transferred or otherwise disposed of for fair market value; and
(v) sales, transfers and other dispositions of accounts
receivable pursuant to one or more Securitization Transactions;
provided that the Net Cash Proceeds from such sale are used to
prepay the Term B Advances pursuant to and in the amount required
in, Section 2.06(b)(ii).
(f) Investments in Other Persons. Make or hold, or permit any of
their Subsidiaries to make or hold, any Investment in any Person,
except:
(i) Investments by Parent, the Borrower and their
Subsidiaries in Loan Parties;
(ii) loans and advances to employees in the ordinary course
of the business of the Parent and its Subsidiaries as presently
conducted in an aggregate principal amount not to exceed
$2,000,000 at any time outstanding;
(iii) Investments by the Parent and its Subsidiaries in Cash
Equivalents;
(iv) Investments existing on the date hereof and described
on Schedule 4.01(x) hereto;
(v) Investments by the Borrower in Hedge Agreements;
(vi) Investments consisting of intercompany Debt permitted
under Section 5.02(b), including, without limitation, loans and
advances to Parent;
(vii) Investments received in connection with the bankruptcy
or reorganization of, or settlement of delinquent accounts and
disputes with, customers and suppliers, in each case in the
ordinary course of business;
(viii) Guarantees for the benefit of, or capital
contributions or loans to, or sale and leaseback transactions
with, Texas Mexican Railway Company or any other domestic railway
company that owns railways that are contiguous with those owned
by the Borrower; provided that the aggregate amount of such
capital contributions, loans and guaranteed Debt and sale and
leaseback transactions shall not exceed $25,000,000;
(ix) the Grupo TFM Investment. the Grupo TFM Acquisition and
any formation by the Parent of a domestic wholly owned subsidiary
to directly or indirectly hold such Investment; provided that
Parent pledges the Equity Interests in such subsidiary to the
Collateral Agent for the benefit of the Secured Parties;
(x) Guarantees for the benefit of, or capital contributions
or loans to, or sale and leaseback transactions with, any company
that is engaged in the same line of business as the Borrower or a
related line of business; provided that the aggregate amount of
such capital contributions, loans and guaranteed Debt and sale
and leaseback transactions shall not exceed $25,000,000;
(xi) Investments made with the net proceeds of issuances of
Equity Interests by Parent or any of its Subsidiaries;
(xii) the Mexrail Acquisition; and
(xiii) Investments not expressly permitted by clauses (i)
through (xii); provided that the aggregate amount all such
Investments shall not at any time exceed $10,000,000.
(g) Restricted Payments. Declare or pay any dividends, purchase,
redeem, retire, defease or otherwise acquire for value any of its
Equity Interests now or hereafter outstanding, return any capital to
its stockholders, partners or members (or the equivalent
Persons thereof) as such, make any distribution of assets, Equity
Interests, obligations or securities to its stockholders, partners or
members (or the equivalent Persons thereof) as such, or permit any of
their Subsidiaries to do any of the foregoing, or permit any of their
Subsidiaries to purchase, redeem, retire, defease or otherwise acquire
for value any Equity Interests in Parent or the Borrower or to issue
or sell any Equity Interests therein of any entity whose Equity
Interests have been pledged as Collateral under the Security
Agreement, except that, so long as no Default shall have occurred and
be continuing at the time of any action described below or would
result therefrom:
(i) Parent may (A) declare and pay dividends and
distributions payable only in common stock of Parent, (B) make
payments restricted by this section pursuant to and in accordance
with stock option plans or other benefit plans for management or
employees of Parent and its Subsidiaries, and (C) pay cash
dividends with respect to shares of its preferred Equity
Interests in respect of which cash dividends are payable or which
require redemptions or repurchases in cash, and
(ii) any Subsidiary of the Parent may (A) declare and pay
dividends ratably with respect to their capital stock and (B)
declare and pay dividends in cash or property to any other Loan
Party of which it is a Subsidiary.
(h) Sale and Leaseback Transactions. Parent will not, and will
not permit any of its Subsidiaries to, enter into any Sale and
Leaseback Transaction other than:
(i) Sale and Leaseback Transactions involving locomotives,
rolling stock or other equipment with Southern Capital
Corporation, LLC;
(ii) Sale and Leaseback Transactions permitted by clauses
(viii) and (x) of Section 5.02(f); and
(iii) any other Sale and Leaseback Transaction if (i) at the
time of such Sale and Leaseback Transaction no Default shall have
occurred and be continuing, (ii) the proceeds from the sale of
the subject property shall be at least equal to its fair market
value on the date of such sale and (iii) the sum of (A) the
aggregate principal amount of the outstanding Debt of Parent and
its Subsidiaries secured by Liens permitted by clause (viii) of
Section 5.02(a) and (B) the Attributable Debt in connection with
all Sale and Leaseback Transactions of Parent and its
Subsidiaries permitted by this clause (c) does not at any time
exceed 10% of Consolidated Net Worth.
(i) Prepayments, Etc., of Debt. Prepay, redeem, purchase, defease
or otherwise satisfy prior to the scheduled maturity thereof in any
manner, or make any payment in violation of any subordination terms
of, any Debt, except (i) the prepayment of the Advances in accordance
with the terms of this Agreement, (ii) regularly scheduled or required
repayments or redemptions of Debt (other than payments in respect of
Subordinated Debt which are in contravention of the subordination
provisions thereof), (iii) any prepayments or redemptions of Debt in
connection with a refunding or
refinancing of such Debt permitted by Section 5.02(b)(i)(B), (iv)
payments of secured Debt that becomes due as a result of the voluntary
sale or transfer of the property or assets securing such Debt and (v)
payments in respect of Debt owed to Parent or any Subsidiary, or
amend, modify or change in any manner any term or condition of any
Material Debt or Subordinated Debt, or take any other action in
connection with any Material Debt that would impair the value of the
interest or rights of any Loan Party thereunder or that would impair
the rights or interests of any Agent or any Lender Party, or permit
any of its Subsidiaries to do any of the foregoing other than to
prepay any Debt payable to the Borrower or the Parent.
(j) Negative Pledge. Enter into or suffer to exist, or permit any
of their Subsidiaries to enter into or suffer to exist, any agreement
prohibiting or conditioning the creation or assumption of any Lien
upon any of its property or assets except (i) in favor of the Secured
Parties or (ii) in connection with (A) any Surviving Debt, (B) any
purchase money Debt permitted by Section 5.02(b)(i)(H) solely to the
extent that the agreement or instrument governing such Debt permits
the Liens of the Secured Parties under the Loan Documents, and any
Liens in connection with the refinancing thereof, (C) any Capitalized
Lease Obligation permitted by Section 5.02(b)(i)(H) solely to the
extent that such Capitalized Lease Obligation permits the Liens of the
Secured Parties under the Loan Documents and any Liens in connection
with the refinancing thereof, or (D) any Debt outstanding on the date
any Subsidiary of Parent becomes such a Subsidiary (so long as such
agreement was not entered into solely in contemplation of such
Subsidiary becoming a Subsidiary of Parent).
(k) Partnerships, Etc. Become a general partner in any general or
limited partnership or joint venture, or permit any of its
Subsidiaries to do so.
(l) Speculative Transactions. Engage, or permit any of its
Subsidiaries to engage, in any transaction involving speculative
transactions other than Hedge Agreements entered into in the ordinary
course of business to hedge or mitigate risks to which Parent, the
Borrower or any of their Subsidiaries shall be exposed in the conduct
of their business and not for speculative purposes.
(m) Capital Expenditures. Make, or permit any of their
Subsidiaries to make, any Capital Expenditures that would cause the
aggregate of all such Capital Expenditures made by Parent and its
Subsidiaries in any Fiscal Year to exceed $110 million.
(n) Formation of Subsidiaries. Organize or invest, or permit any
of their Subsidiaries to organize or invest, in any new Subsidiary
except as permitted under Section 5.02(f)(i) or (ix).
(o) Payment Restrictions Affecting Subsidiaries. Directly or
indirectly, enter into or suffer to exist, or permit any of their
Subsidiaries to enter into or suffer to exist, any agreement or
arrangement limiting the ability of any of their Subsidiaries to
declare or pay dividends or other distributions in respect of its
Equity Interests or repay or prepay any Debt owed to, make loans or
advances to, or otherwise transfer assets to or invest in, Parent or
any Subsidiary of Parent (whether through a covenant restricting
dividends,
loans, asset transfers or investments, a financial covenant or
otherwise), except (i) the Loan Documents, (ii) any agreement or
instrument evidencing Surviving Debt and (iii) any agreement in effect
at the time such Subsidiary becomes a Subsidiary of the Borrower or
the Parent, so long as such agreement was not entered into solely in
contemplation of such Person becoming a Subsidiary of the Borrower or
the Parent.
SECTION 5.03. Reporting Requirements. So long as any Advance or any
other Obligation of any Loan Party under any Loan Document shall remain
unpaid, any Letter of Credit shall be outstanding or any Lender Party shall
have any Commitment hereunder, Parent or the Borrower will furnish to the
Agents and the Lender Parties:
(a) Default Notice Etc. As soon as possible and in any event
within five days after the occurrence of each Default or any event,
development or occurrence reasonably likely to have a Material Adverse
Effect continuing on the date of such statement, including, without
limitation, notice of all actions, suits, investigations, litigation
and proceedings before any Governmental Authority affecting any Loan
Party or any of its Subsidiaries of the type described in
Section 4.01(f), a statement of the chief financial officer of the
Borrower setting forth details of such Default or such litigation or
other proceeding and the action that the Borrower has taken and
proposes to take with respect thereto.
(b) Annual Financials. As soon as available and in any event
within 90 days after the end of each Fiscal Year (A), a copy of
audited financial statements for such year for Parent and its
subsidiaries, including therein a Consolidated balance sheet of Parent
and its subsidiaries as of the end of such Fiscal Year and a
Consolidated statement of income and a Consolidated statement of cash
flows of Parent and its subsidiaries for such Fiscal Year, in each
case accompanied by (i) an opinion (without a "going concern" or like
qualification or exception and without any qualification or exception
as to the scope of such audit) of KPMG LLP or other independent public
accountants of recognized standing acceptable to the Required Lenders,
together with a certificate of such accounting firm to the Lender
Parties stating that in the course of the regular audit of the
business of the Parent and its subsidiaries, which audit was conducted
by such accounting firm in accordance with generally accepted auditing
standards, such accounting firm has obtained no knowledge that a
Default has occurred and is continuing during the course of its audit
(which certificate may be limited to the extent required by accounting
rules or guidelines), or if, in the opinion of such accounting firm, a
Default has occurred and is continuing, a statement as to the nature
thereof, and (ii) a certificate of the chief financial officer of the
Parent stating that no Default has occurred and is continuing or, if a
Default has occurred and is continuing, a statement as to the nature
thereof and the action that the Parent has taken and proposes to take
with respect thereto together with a schedule in form satisfactory to
the Administrative Agent of the computations used by the Borrower in
determining, as of the end of such Fiscal Year, compliance with the
covenants contained in Section 5.04 provided that in the event of any
change in generally accepted accounting principles used in the
preparation of such financial statements, the Parent shall also
provide, if necessary for the determination of compliance with Section
5.04, a statement of reconciliation conforming such financial
statements to GAAP and (B) for Parent and its Consolidated
subsidiaries other than Mexrail, Caymex, any domestic
wholly owned subsidiary of Parent which holds the Investment in Grupo
TFM or the Panama Canal Railway Company, and their respective
subsidiaries, its unaudited consolidated balance sheet and related
statement of income as of the end of and for such year, all certified
by its chief financial officer as presenting fairly in all material
respects the financial condition and results of operations of Parent
and its Consolidated subsidiaries other than Mexrail, Caymex, any
domestic wholly owned subsidiary of Parent which holds the Investment
in Grupo TFM or the Panama Canal Railway Company, and their respective
subsidiaries, on a consolidated basis consistently applied.
(c) Quarterly Financials. As soon as available and in any event
within 45 days after the end of each of the first three quarters of
each Fiscal Year, (A) a Consolidated balance sheet of Parent and its
subsidiaries as of the end of such quarter and a Consolidated
statement of income and a Consolidated statement of cash flows of
Parent and its subsidiaries for the period commencing at the end of
the previous fiscal quarter and ending with the end of such fiscal
quarter and a Consolidated statement of income and a Consolidated
statement of cash flows of Parent and its subsidiaries for the period
commencing at the end of the previous Fiscal Year and ending with the
end of such quarter, setting forth in each case in comparative form
the corresponding figures for the corresponding date or period of the
preceding Fiscal Year, all in reasonable detail and duly certified
(subject to normal year-end audit adjustments) by the chief financial
officer of the Parent as having been prepared in accordance with GAAP,
together with (i) a certificate of said officer stating that no
Default has occurred and is continuing or, if a Default has occurred
and is continuing, a statement as to the nature thereof and the action
that the Parent has taken and proposes to take with respect thereto
and (ii) a schedule in form satisfactory to the Administrative Agent
of the computations used by the Borrower in determining compliance
with the covenants contained in Section 5.04, provided that in the
event of any change in generally accepted accounting principles used
in the preparation of such financial statements, the Borrower shall
also provide, if necessary for the determination of compliance with
Section 5.04, a statement of reconciliation conforming such financial
statements to GAAP and (B) for Parent and its Consolidated
subsidiaries other than Mexrail, Caymex, any domestic wholly owned
subsidiary of Parent which holds the Investment in Group TFM or the
Panama Canal Railway Company, and their respective subsidiaries, its
unaudited consolidated balance sheet and related statement of income
as of the end of and for such fiscal quarter and the then elapsed
portion of the fiscal year, all certified by its chief financial
officer as presenting fairly in all material respects the financial
condition and results of operations of Parent and its Consolidated
subsidiaries other than Mexrail, Caymex, any domestic wholly owned
subsidiary of Parent which holds the Investment in Group TFM or the
Panama Railway Company, and their respective subsidiaries, on a
consolidated basis consistently applied, subject to normal year-end
audit adjustments and the absence of footnotes.
(d) Annual Forecasts. As soon as available and in any event no
later than 30 days after the end of each Fiscal Year, forecasts
prepared by management of Parent and the Borrower, in form
satisfactory to the Administrative Agent, of balance sheets, income
statements and cash flow statements on a monthly basis for the Fiscal
Year following such Fiscal Year and on an annual basis for each Fiscal
Year thereafter until the Termination Date.
(e) Securities Reports. Promptly after the same shall be publicly
available, copies of all proxy statements, financial statements,
regular, periodic and special reports, and all registration
statements, that any Loan Party or any of its Subsidiaries files with
the Securities and Exchange Commission or any governmental authority
that may be substituted therefor, or with any national securities
exchange.
(f) Agreement Notices. Promptly upon receipt thereof, copies of
all notices, requests and other documents received by any Loan Party
or any of its Subsidiaries under or pursuant to any Material Debt
Document or instrument, indenture, loan or credit or similar agreement
regarding or related to any breach or default by any party thereto or
any other event that could materially impair the value of the
interests or the rights of any Loan Party or otherwise have a Material
Adverse Effect and copies of any amendment, modification or waiver of
any material provision of any Material Debt Document and, from time to
time upon request by the Administrative Agent, such information and
reports regarding the Material Debt Documents as the Administrative
Agent may reasonably request.
(i) ERISA. Prompt written notice of (i) the occurrence of any
Reportable Event with respect to any Plan, (ii) the incurrence of
Withdrawal Liability with respect to any Multiemployer Plan, (iii) the
receipt by Parent or any member of the Controlled Group of any notice
concerning the imposition of Withdrawal Liability or a determination
that a Multiemployer Plan is, or is expected to be, insolvent or in
reorganization within the meaning of Title IV of ERISA or (iv) any
other development that results in, or could reasonably be expected to
result in, a Material Adverse Effect.
(g) Environmental Conditions. Promptly after the assertion or
occurrence thereof, notice of any Environmental Action against or of
any noncompliance by any Loan Party or any of its Subsidiaries with
any Environmental Law or Environmental Permit that could
(i) reasonably be expected to have a Material Adverse Effect or
(ii) cause any property described in the Mortgages to be subject to
any material restrictions on ownership, occupancy, use or
transferability under any Environmental Law.
(h) Insurance. The Borrower will furnish to the Lenders, upon
request of the Administrative Agent, information in reasonable detail
as to the insurance coverage it maintains.
(i) Other Information. Such other information respecting the
business, condition (financial or otherwise), operations, performance,
properties or prospects of any Loan Party or any of its Subsidiaries
as any Agent, or any Lender Party through the Administrative Agent,
may from time to time reasonably request.
SECTION 5.04. Financial Covenants. So long as any Advance or any other
Obligation of any Loan Party under any Loan Document shall remain unpaid,
any Letter of Credit shall be outstanding or any Lender Party shall have
any Commitment hereunder, the Parent and its Subsidiaries will:
(a) Leverage Ratio. Maintain at the end of each fiscal quarter of
the Parent a Leverage Ratio of not more than the amount set forth
below for each period set forth below:
===========================================================================
Quarter Ending Ratio
===========================================================================
===========================================================================
March 31, 2004 5.50:1.00
===========================================================================
===========================================================================
June 30, 2004 5.50:1.00
===========================================================================
===========================================================================
September 30, 2004 5.50:1.00
===========================================================================
===========================================================================
December 31, 2004 5.50:1.00
===========================================================================
===========================================================================
March 31, 2005 5.25:1.00
===========================================================================
===========================================================================
June 30, 2005 5.25:1.00
===========================================================================
===========================================================================
September 30, 2005 5.00:1.00
===========================================================================
===========================================================================
December 31, 2005 5.00:1.00
===========================================================================
===========================================================================
March 31, 2006 4.75:1.00
===========================================================================
===========================================================================
June 30, 2006 4.75:1.00
===========================================================================
===========================================================================
September 30, 2006 and thereafter 4.50:1.00
===========================================================================
(b) Interest Coverage Ratio. Maintain at the end of each fiscal
quarter of the Parent an Interest Coverage Ratio of not less than the
amount set forth below for each period set forth below:
===========================================================================
Quarter Ending Ratio
===========================================================================
===========================================================================
March 31, 2004 1.75:1.00
===========================================================================
===========================================================================
June 30, 2004 1.75:1.00
===========================================================================
===========================================================================
September 30, 2004 1.75:1.00
===========================================================================
===========================================================================
December 31, 2004 1.75:1.00
===========================================================================
===========================================================================
March 31, 2005 and thereafter 2.00:1.00
===========================================================================
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the following events
("Events of Default") shall occur and be continuing:
(a) (i) the Borrower shall fail to pay any principal of any
Advance when the same shall become due and payable or (ii) the
Borrower shall fail to pay any interest on any Advance, or any Loan
Party shall fail to make any other payment under any Loan Document, in
each case under this clause (ii) within five Business Days after the
same shall become due and payable; or
(b) any representation or warranty made by any Loan Party (or any
of its officers) under or in connection with any Loan Document shall
prove to have been incorrect in any material respect when made; or
(c) Parent or the Borrower shall fail to perform or observe any
term, covenant or agreement contained in Section 2.14, 5.01(d), (e),
5.02, 5.03 or 5.04; or
(d) any Loan Party shall fail to perform or observe any other
term, covenant or agreement contained in any Loan Document on its part
to be performed or observed if such failure shall remain unremedied
for 15 days after written notice thereof shall have been given to the
Borrower by any Agent or any Lender Party; or
(e) any Loan Party or any of its Subsidiaries shall fail to pay
any principal of, premium or interest on or any other amount payable
in respect of any Material Debt of such Loan Party or such Subsidiary
(as the case may be) that is outstanding (but excluding Debt
outstanding hereunder), when the same becomes due and payable (whether
by scheduled maturity, required prepayment, acceleration, demand or
otherwise), and such failure shall continue after the applicable grace
period, if any, specified in the agreement or instrument relating to
such Debt; or any other event shall occur or condition shall exist
under any agreement or instrument relating to any such Debt and shall
continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such event or condition is
to accelerate, or to permit the acceleration of, the maturity of such
Debt or otherwise to cause, or to permit the holder thereof to cause,
such Debt to mature; or any such Debt shall be declared to be due and
payable or required to be prepaid or redeemed (other than by a
regularly scheduled required prepayment or redemption), purchased or
defeased, or an offer to prepay, redeem, purchase or defease such Debt
shall be required to be made, in each case prior to the stated
maturity thereof; or
(f) any Loan Party or any of its Subsidiaries shall generally not
pay its debts as such debts become due, or shall admit in writing its
inability to pay its debts generally, or shall make a general
assignment for the benefit of creditors; or any proceeding shall be
instituted by or against any Loan Party or any of its Subsidiaries
seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or
relief of debtors, or seeking the entry of an order for relief or the
appointment of a receiver, trustee or other similar official for it or
for any substantial part of its property and, in the case of any such
proceeding instituted against it (but not instituted by it) that is
being diligently contested by it in good faith, either such proceeding
shall remain undismissed or unstayed for a period of 60 days or any of
the actions sought in such proceeding (including, without limitation,
the entry of an order for relief against, or the appointment of a
receiver, trustee, custodian or other similar official for, it or any
substantial part of its property) shall occur; or any Loan Party or
any of its Subsidiaries shall take any corporate action to authorize
any of the actions set forth above in this subsection (f); or
(g) any judgments or orders, either individually or in the
aggregate, for the payment of money in excess of $10,000,000 shall be
rendered against any Loan Party or any of its Subsidiaries and either
(i) enforcement proceedings shall have been commenced by any creditor
upon such judgment or order or (ii) there shall be any period of 30
consecutive days during which a stay of enforcement of such judgment
or order, by reason of a pending appeal or otherwise, shall not be in
effect; or
(h) any non-monetary judgment or order shall be rendered against
any Loan Party or any of its Subsidiaries that is reasonably likely to
have a Material Adverse Effect, and there shall be any period of 60
consecutive days during which a stay of enforcement of such judgment
or order, by reason of a pending appeal or otherwise, shall not be in
effect; or
(i) any provision of any Loan Document after delivery thereof
pursuant to Section 3.01 or 5.01(i) shall for any reason cease to be
valid and binding on or enforceable against any Loan Party party to
it, or any such Loan Party shall so state in writing; or
(j) any Collateral Document or financing statement after delivery
thereof pursuant to Section 3.01 or 5.01(i) shall for any reason
(other than pursuant to the terms thereof) cease to create a valid and
perfected first priority lien on and security interest in a material
portion of the Collateral purported to be covered thereby; or
(k) a Change of Control shall occur;
(l) any ERISA Event shall have occurred which, in the opinion of
the Required Lenders, could reasonably be expected to have a Material
Adverse Effect.; or
(m) an event of default or purchase termination event or other
comparable event shall occur in respect of any Securitization
Transaction in an aggregate amount greater than $20,000,000, in any
case that could reasonably be expected to have a material and adverse
effect on the liquidity of the Borrower or any of its Subsidiaries or
otherwise result in a Material Adverse Effect;
then, and in any such event, the Administrative Agent (i) shall at the
request, or may with the consent, of the Required Lenders, by notice to the
Borrower, declare the Commitments of each
Lender Party and the obligation of each Lender Party to make Advances
(other than Letter of Credit Advances by the Issuing Bank or a Revolving
Credit Lender pursuant to Section 2.03(c) and Swing Line Advances by a
Revolving Credit Lender pursuant to Section 2.02(b)) and of the Issuing
Bank to issue Letters of Credit to be terminated, whereupon the same shall
forthwith terminate, and (ii) shall at the request, or may with the
consent, of the Required Lenders, (A) by notice to the Borrower, declare
the Notes, all interest thereon and all other amounts payable under this
Agreement and the other Loan Documents to be forthwith due and payable,
whereupon the Notes, all such interest and all such amounts shall become
and be forthwith due and payable, without presentment, demand, protest or
further notice of any kind, all of which are hereby expressly waived by the
Borrower, (B) by notice to each party required under the terms of any
agreement in support of which a Standby Letter of Credit is issued, request
that all Obligations under such agreement be declared to be due and
payable; provided, however, that in the event of an actual or deemed entry
of an order for relief with respect to the Borrower under the Federal
Bankruptcy Code, (x) the Commitments of each Lender Party and the
obligation of each Lender Party to make Advances (other than Letter of
Credit Advances by the Issuing Bank or a Revolving Credit Lender pursuant
to Section 2.03(c) and Swing Line Advances by a Revolving Credit Lender
pursuant to Section 2.02(b)) and of the Issuing Bank to issue Letters of
Credit shall automatically be terminated and (y) the Notes, all such
interest and all such amounts shall automatically become and be due and
payable, without presentment, demand, protest or any notice of any kind,
all of which are hereby expressly waived by the Borrower.
SECTION 6.02. Actions in Respect of the Letters of Credit upon
Default. If any Event of Default shall have occurred and be continuing, the
Administrative Agent may, or shall at the request of the Required Lenders,
irrespective of whether it is taking any of the actions described in
Section 6.01 or otherwise, make demand upon the Borrower to, and forthwith
upon such demand the Borrower will, pay to the Collateral Agent on behalf
of the Lender Parties in same day funds at the Collateral Agent's Office,
for deposit in the L/C Collateral Account, an amount equal to the aggregate
Available Amount of all Letters of Credit then outstanding; provided,
however, that in the event of an actual or deemed entry of an order for
relief with respect to the Borrower under the Bankruptcy Law, the Borrower
will pay to the Collateral Agent on behalf of the Lender Parties in same
day funds at the Collateral Agent's Office, for deposit in the L/C
Collateral Account, an amount equal to the aggregate Available Amount of
all Letters of Credit then outstanding, without presentment, demand,
protest or any notice of any kind, all of which are hereby expressly waived
by the Borrower. If at any time the Administrative Agent or the Collateral
Agent determines that any funds held in the L/C Collateral Account are
subject to any right or claim of any Person other than the Agents and the
Lender Parties or that the total amount of such funds is less than the
aggregate Available Amount of all Letters of Credit, the Borrower will,
forthwith upon demand by the Administrative Agent or the Collateral Agent,
pay to the Collateral Agent, as additional funds to be deposited and held
in the L/C Collateral Account, an amount equal to the excess of (a) such
aggregate Available Amount over (b) the total amount of funds, if any, then
held in the L/C Collateral Account that the Administrative Agent or the
Collateral Agent, as the case may be, determines to be free and clear of
any such right and claim. Upon the drawing of any Letter of Credit for
which funds are on deposit in the L/C Collateral Account, such funds shall
be applied to reimburse the Issuing Bank or Revolving Credit Lenders, as
applicable, to the extent permitted by applicable law.
ARTICLE VII
THE AGENTS
SECTION 7.01. Authorization and Action. (a) Each Lender Party (in its
capacities as a Lender, the Swing Line Bank (if applicable), the Issuing
Bank (if applicable) and on behalf of itself and its Affiliates as
potential Hedge Banks) hereby appoints and authorizes each Agent to take
such action as agent on its behalf and to exercise such powers and
discretion under this Agreement and the other Loan Documents as are
delegated to such Agent by the terms hereof and thereof, together with such
powers and discretion as are reasonably incidental thereto. As to any
matters not expressly provided for by the Loan Documents (including,
without limitation, enforcement or collection of the Notes), no Agent shall
be required to exercise any discretion or take any action, but shall be
required to act or to refrain from acting (and shall be fully protected in
so acting or refraining from acting) upon the instructions of the Required
Lenders, and such instructions shall be binding upon all Lender Parties and
all holders of Notes; provided, however, that no Agent shall be required to
take any action that exposes such Agent to personal liability or that is
contrary to this Agreement or applicable law. Each Agent agrees to give to
each Lender Party prompt notice of each notice given to it by the Borrower
pursuant to the terms of this Agreement.
(b) In furtherance of the foregoing, each Lender Party (in its
capacities as a Lender, the Swing Line Bank (if applicable), the Issuing
Bank (if applicable) and on behalf of itself and its Affiliates as
potential Hedge Banks) hereby appoints and authorizes the Collateral Agent
to act as the agent of such Lender Party for purposes of acquiring, holding
and enforcing any and all Liens on Collateral granted by any of the Loan
Parties to secure any of the Secured Obligations, together with such powers
and discretion as are reasonably incidental thereto. In this connection,
the Collateral Agent (and any Supplemental Collateral Agents appointed by
the Collateral Agent pursuant to Section 7.01(c) for purposes of holding or
enforcing any Lien on the Collateral (or any portion thereof) granted under
the Collateral Documents, or for exercising any rights or remedies
thereunder at the direction of the Collateral Agent), shall be entitled to
the benefits of this Article VII (including, without limitation, Section
7.05 as though such Supplemental Collateral Agents were an "Agent" under
the Loan Documents) as if set forth in full herein with respect thereto.
(c) Any Agent may execute any of its duties under this Agreement or
any other Loan Document (including for purposes of holding or enforcing any
Lien on the Collateral (or any portion thereof) granted under the
Collateral Documents or of exercising any rights and remedies thereunder at
the direction of the Collateral Agent) by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel and other
consultants or experts concerning all matters pertaining to such duties.
The Collateral Agent may also from time to time, when the Collateral Agent
deems it to be necessary or desirable, appoint one or more trustees,
co-trustees, collateral co-agents, collateral subagents or
attorneys-in-fact (each, a "Supplemental Collateral Agent") with respect to
all or any part of the Collateral; provided, however, that no such
Supplemental Collateral Agent shall be authorized to take any action with
respect to any Collateral unless and except to the extent expressly
authorized in writing by the Collateral Agent. Should any instrument in
writing from the Borrower or any other Loan Party be required by any
Supplemental Collateral Agent so appointed by the Collateral Agent to more
fully or certainly vest in and confirm to such Supplemental Collateral
Agent such rights, powers, privileges and duties, the Borrower shall, or
shall cause such Loan Party to, execute, acknowledge and deliver any and
all such instruments promptly upon request by the Collateral Agent. If any
Supplemental Collateral Agent, or successor thereto, shall die, become
incapable of acting, resign or be removed, all rights, powers, privileges
and duties of such Supplemental Collateral Agent, to the extent permitted
by law, shall automatically vest in and be exercised by the Collateral
Agent until the appointment of a new Supplemental Collateral Agent. No
Agent shall be responsible for the negligence or misconduct of any agent,
attorney-in-fact or Supplemental Collateral Agent that it selects in
accordance with the foregoing provisions of this Section 7.01(c) in the
absence of such Agent's gross negligence or willful misconduct.
SECTION 7.02. Agents' Reliance, Etc. Neither any Agent nor any of
their respective directors, officers, agents or employees shall be liable
for any action taken or omitted to be taken by it or them under or in
connection with the Loan Documents, except for its or their own gross
negligence or willful misconduct. Without limitation of the generality of
the foregoing, each Agent: (a) may treat the payee of any Note as the
holder thereof until, in the case of the Administrative Agent, the
Administrative Agent receives and accepts an Assignment and Acceptance
entered into by the Lender that is the payee of such Note, as assignor, and
an Eligible Assignee, as assignee, or, in the case of any other Agent, such
Agent has received notice from the Administrative Agent that it has
received and accepted such Assignment and Acceptance, in each case as
provided in Section 9.07; (b) may consult with legal counsel (including
counsel for any Loan Party), independent public accountants and other
experts selected by it and shall not be liable for any action taken or
omitted to be taken in good faith by it in accordance with the advice of
such counsel, accountants or experts; (c) makes no warranty or
representation to any Lender Party and shall not be responsible to any
Lender Party for any statements, warranties or representations (whether
written or oral) made in or in connection with the Loan Documents;
(d) shall not have any duty to ascertain or to inquire as to the
performance, observance or satisfaction of any of the terms, covenants or
conditions of any Loan Document on the part of any Loan Party or the
existence at any time of any Default under the Loan Documents or to inspect
the property (including the books and records) of any Loan Party; (e) shall
not be responsible to any Lender Party for the due execution, legality,
validity, enforceability, genuineness, sufficiency or value of, or the
perfection or priority of any lien or security interest created or
purported to be created under or in connection with, any Loan Document or
any other instrument or document furnished pursuant thereto; and (f) shall
incur no liability under or in respect of any Loan Document by acting upon
any notice, consent, certificate or other instrument or writing (which may
be by telegram, telecopy or telex) believed by it to be genuine and signed
or sent by the proper party or parties.
SECTION 7.03. BNS, Morgan Stanley and Affiliates. With respect to its
Commitments, the Advances made by it and the Notes issued to it, BNS and
Morgan Stanley shall have the same rights and powers under the Loan
Documents as any other Lender Party and may exercise the same as though it
were not an Agent; and the term "Lender Party" or "Lender Parties" shall,
unless otherwise expressly indicated, include BNS and Morgan Stanley in
their respective individual capacities. BNS and Morgan Stanley and their
respective affiliates may accept deposits from, lend money to, act as
trustee under indentures of, accept investment banking engagements from and
generally engage in any kind of business with, any Loan Party, any of its
Subsidiaries and any Person that may do business with or own securities of
any Loan Party or
any such Subsidiary, all as if BNS and Morgan Stanley were not Agents and
without any duty to account therefor to the Lender Parties. No Agent shall
have any duty to disclose any information obtained or received by it or any
of its Affiliates relating to any Loan Party or any of its Subsidiaries to
the extent such information was obtained or received in any capacity other
than as such Agent.
SECTION 7.04. Lender Party Credit Decision. Each Lender Party
acknowledges that it has, independently and without reliance upon any Agent
or any other Lender Party and based on the financial statements referred to
in Section 4.01 and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender Party also acknowledges that it will, independently
and without reliance upon any Agent or any other Lender Party and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action
under this Agreement.
SECTION 7.05. Indemnification. (a) Each Lender Party severally agrees
to indemnify each Agent (to the extent not promptly reimbursed by the
Borrower) from and against such Lender Party's ratable share (determined as
provided below) of any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of
any kind or nature whatsoever that may be imposed on, incurred by, or
asserted against such Agent in any way relating to or arising out of the
Loan Documents or any action taken or omitted by such Agent under the Loan
Documents (collectively, the "Indemnified Costs"); provided, however, that
no Lender Party shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from such Agent's gross negligence or
willful misconduct as found in a final, non-appealable judgment by a court
of competent jurisdiction. Without limitation of the foregoing, each Lender
Party agrees to reimburse each Agent promptly upon demand for its ratable
share of any costs and expenses (including, without limitation, fees and
expenses of counsel) payable by the Borrower under Section 9.04, to the
extent that such Agent is not promptly reimbursed for such costs and
expenses by the Borrower. In the case of any investigation, litigation or
proceeding giving rise to any Indemnified Costs, this Section 7.05 applies
whether any such investigation, litigation or proceeding is brought by any
Lender Party or any other Person.
(b) Each Lender Party severally agrees to indemnify the Issuing Bank
(to the extent not promptly reimbursed by the Borrower) from and against
such Lender Party's ratable share (determined as provided below) of any and
all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever that may be imposed on, incurred by, or asserted against the
Issuing Bank in any way relating to or arising out of the Loan Documents or
any action taken or omitted by the Issuing Bank under the Loan Documents;
provided, however, that no Lender Party shall be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the
Issuing Bank's gross negligence or willful misconduct as found in a final,
non-appealable judgment by a court of competent jurisdiction. Without
limitation of the foregoing, each Lender Party agrees to reimburse the
Issuing Bank promptly upon demand for its ratable share of any costs and
expenses (including, without limitation, fees and expenses of counsel)
payable by the Borrower under Section 9.04, to the
extent that the Issuing Bank is not promptly reimbursed for such costs and
expenses by the Borrower.
(c) For purposes of this Section 7.05, the Lender Parties' respective
ratable shares of any amount shall be determined, at any time, according to
the sum of (i) the aggregate principal amount of the Advances outstanding
at such time and owing to the respective Lender Parties, (ii) their
respective Pro Rata Shares of the aggregate Available Amount of all Letters
of Credit outstanding at such time, (iii) the aggregate unused portions of
their respective Term B Commitments at such time and (iv) their respective
Unused Working Capital Commitments at such time; provided that the
aggregate principal amount of Swing Line Advances owing to the Swing Line
Bank and of Letter of Credit Advances owing to the Issuing Bank shall be
considered to be owed to the Revolving Credit Lenders ratably in accordance
with their respective Revolving Credit Commitments. The failure of any
Lender Party to reimburse any Agent or the Issuing Bank, as the case may
be, promptly upon demand for its ratable share of any amount required to be
paid by the Lender Parties to such Agent or the Issuing Bank, as the case
may be, as provided herein shall not relieve any other Lender Party of its
obligation hereunder to reimburse such Agent or the Issuing Bank, as the
case may be, for its ratable share of such amount, but no Lender Party
shall be responsible for the failure of any other Lender Party to reimburse
such Agent or the Issuing Bank, as the case may be, for such other Lender
Party's ratable share of such amount. Without prejudice to the survival of
any other agreement of any Lender Party hereunder, the agreement and
obligations of each Lender Party contained in this Section 7.05 shall
survive the payment in full of principal, interest and all other amounts
payable hereunder and under the other Loan Documents.
SECTION 7.06. Successor Agents. Any Agent may resign as to any or all
of the Facilities at any time by giving written notice thereof to the
Lender Parties and the Borrower and may be removed as to all of the
Facilities at any time with or without cause by the Required Lenders;
provided, however, that any removal of the Administrative Agent will not be
effective until it has also been replaced as Collateral Agent, Swing Line
Bank and Letter of Credit Issuing Bank and released from all of its
obligations in respect thereof. Upon any such resignation or removal, the
Required Lenders shall have the right with the approval of the Borrower
(such approval not to be unreasonably withheld) to appoint a successor
Agent as to such of the Facilities as to which such Agent has resigned or
been removed. If no successor Agent shall have been so appointed by the
Required Lenders, and shall have accepted such appointment, within 30 days
after the retiring Agent's giving of notice of resignation or the Required
Lenders' removal of the retiring Agent, then the retiring Agent may, on
behalf of the Lender Parties, with the approval of the Borrower (such
approval not to be unreasonably withheld) appoint a successor Agent, which
shall be a commercial bank organized under the laws of the United States or
of any State thereof and having a combined capital and surplus of at least
$250,000,000. Upon the acceptance of any appointment as Agent hereunder by
a successor Agent as to all of the Facilities and, in the case of a
successor Collateral Agent, upon the execution and filing or recording of
such financing statements, or amendments thereto, and such amendments or
supplements to the Mortgages, and such other instruments or notices, as may
be necessary or desirable, or as the Required Lenders may request, in order
to continue the perfection of the Liens granted or purported to be granted
by the Collateral Documents, such successor Agent shall succeed to and
become vested with all the rights, powers, discretion, privileges and
duties of the retiring Agent, and the retiring Agent shall be discharged
from its
duties and obligations under the Loan Documents. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent as to less than all of
the Facilities and, in the case of a successor Collateral Agent, upon the
execution and filing or recording of such financing statements, or
amendments thereto, and such amendments or supplements to the Mortgages,
and such other instruments or notices, as may be necessary or desirable, or
as the Required Lenders may request, in order to continue the perfection of
the Liens granted or purported to be granted by the Collateral Documents,
such successor Agent shall succeed to and become vested with all the
rights, powers, discretion, privileges and duties of the retiring Agent as
to such Facilities, other than with respect to funds transfers and other
similar aspects of the administration of Borrowings under such Facilities,
issuances of Letters of Credit (notwithstanding any resignation as Agent
with respect to the Letter of Credit Facility) and payments by the Borrower
in respect of such Facilities, and the retiring Administrative Agent shall
be discharged from its duties and obligations under this Agreement as to
such Facilities, other than as aforesaid. If within 45 days after written
notice is given of the retiring Agent's resignation or removal under this
Section 7.06 no successor Agent shall have been appointed and shall have
accepted such appointment, then on such 45th day (a) the retiring Agent's
resignation or removal shall become effective, (b) the retiring Agent shall
thereupon be discharged from its duties and obligations under the Loan
Documents and (c) the Required Lenders shall thereafter perform all duties
of the retiring Agent under the Loan Documents until such time, if any, as
the Required Lenders appoint a successor Agent as provided above. After any
retiring Agent's resignation or removal hereunder as Agent as to any of the
Facilities shall have become effective, the provisions of this Article VII
shall inure to its benefit as to any actions taken or omitted to be taken
by it while it was Agent as to such Facilities under this Agreement.
ARTICLE VIII
GUARANTY
SECTION 8.01. Guaranty; Limitation of Liability.
(a) Each Guarantor, jointly and severally, hereby absolutely,
unconditionally and irrevocably guarantees the punctual payment when due,
whether at scheduled maturity or on any date of a required prepayment or by
acceleration, demand or otherwise, of all Obligations of each other Loan
Party now or hereafter existing under or in respect of the Loan Documents
(including, without limitation, any extensions, modifications,
substitutions, amendments or renewals of any or all of the foregoing
Obligations), whether direct or indirect, absolute or contingent, and
whether for principal, interest (including, without limitation, Post
Petition Interest), premiums, fees, indemnities, contract causes of action,
costs, expenses or otherwise (such Obligations being the "Guaranteed
Obligations"), and agrees to pay any and all expenses (including, without
limitation, fees and expenses of counsel) incurred by the Administrative
Agent or any other Secured Party in enforcing any rights under this
Guaranty or any other Loan Document. Without limiting the generality of the
foregoing, each Guarantor's liability shall extend to all amounts that
constitute part of the Guaranteed Obligations and would be owed by any
other Loan Party to any Secured Party under or in respect of the Loan
Documents but for the fact that they are unenforceable or not allowable due
to the existence of a bankruptcy, reorganization or similar proceeding
involving such other Loan Party.
(b) Each Guarantor, and by its acceptance of this Guaranty, the
Administrative Agent and each other Secured Party, hereby confirms that it
is the intention of all such Persons that this Guaranty and the Obligations
of each Subsidiary Guarantor hereunder not constitute a fraudulent transfer
or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar foreign,
federal or state law to the extent applicable to this Guaranty and the
Obligations of each Subsidiary Guarantor hereunder. To effectuate the
foregoing intention, the Administrative Agent, the other Secured Parties
and the Guarantors hereby irrevocably agree that the Obligations of each
Subsidiary Guarantor under this Guaranty at any time shall be limited to
the maximum amount as will result in the Obligations of such Guarantor
under this Guaranty not constituting a fraudulent transfer or conveyance.
(c) Each Guarantor hereby unconditionally and irrevocably agrees that
in the event any payment shall be required to be made to any Secured Party
under this Guaranty or any other guaranty, such Guarantor will contribute,
to the maximum extent permitted by law, such amounts to each other
Guarantor and each other guarantor so as to maximize the aggregate amount
paid to the Secured Parties under or in respect of the Loan Documents.
SECTION 8.02. Guaranty Absolute. Each Guarantor guarantees that the
Guaranteed Obligations will be paid strictly in accordance with the terms
of the Loan Documents, regardless of any law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such terms or the
rights of any Secured Party with respect thereto. The Obligations of each
Guarantor under or in respect of this Guaranty are independent of the
Guaranteed Obligations or any other Obligations of any other Loan Party
under or in respect of the Loan Documents, and a separate action or actions
may be brought and prosecuted against each Guarantor to enforce this
Guaranty, irrespective of whether any action is brought against the
Borrower or any other Loan Party or whether the Borrower or any other Loan
Party is joined in any such action or actions. The liability of each
Guarantor under this Guaranty shall be irrevocable, absolute and
unconditional irrespective of, and each Guarantor hereby irrevocably waives
any defenses it may now have or hereafter acquire in any way relating to,
any or all of the following:
(a) any lack of validity or enforceability of any Loan Document or any
agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Guaranteed Obligations or any other
Obligations of any other Loan Party under or in respect of the Loan
Documents, or any other amendment or waiver of or any consent to departure
from any Loan Document, including, without limitation, any increase in the
Guaranteed Obligations resulting from the extension of additional credit to
any Loan Party or any of its Subsidiaries or otherwise;
(c) any taking, exchange, release or non-perfection of any Collateral
or any other collateral, or any taking, release or amendment or waiver of,
or consent to departure from, any other guaranty, for all or any of the
Guaranteed Obligations;
(d) any manner of application of Collateral or any other collateral,
or proceeds thereof, to all or any of the Guaranteed Obligations, or any
manner of sale or other disposition of
any Collateral or any other collateral for all or any of the Guaranteed
Obligations or any other Obligations of any Loan Party under the Loan
Documents or any other assets of any Loan Party or any of its Subsidiaries;
(e) any change, restructuring or termination of the corporate
structure or existence of any Loan Party or any of its Subsidiaries;
(f) any failure of any Secured Party to disclose to any Loan Party any
information relating to the business, condition (financial or otherwise),
operations, performance, properties or prospects of any other Loan Party
now or hereafter known to such Secured Party (each Guarantor waiving any
duty on the part of the Secured Parties to disclose such information);
(g) the failure of any other Person to execute or deliver this
Guaranty, any Guaranty Supplement or any other guaranty or agreement or the
release or reduction of liability of any Guarantor or other guarantor or
surety with respect to the Guaranteed Obligations; or
(h) any other circumstance (including, without limitation, any statute
of limitations) or any existence of or reliance on any representation by
any Secured Party that might otherwise constitute a defense available to,
or a discharge of, any Loan Party or any other guarantor or surety.
This Guaranty shall continue to be effective or be reinstated, as the case
may be, if at any time any payment of any of the Guaranteed Obligations is
rescinded or must otherwise be returned by any Secured Party or any other
Person upon the insolvency, bankruptcy or reorganization of the Borrower or
any other Loan Party or otherwise, all as though such payment had not been
made.
SECTION 8.03. Waivers and Acknowledgments. (a) Each Guarantor hereby
unconditionally and irrevocably waives promptness, diligence, notice of
acceptance, presentment, demand for performance, notice of nonperformance,
default, acceleration, protest or dishonor and any other notice with
respect to any of the Guaranteed Obligations and this Guaranty and any
requirement that any Secured Party protect, secure, perfect or insure any
Lien or any property subject thereto or exhaust any right or take any
action against any Loan Party or any other Person or any Collateral.
(b) Each Guarantor hereby unconditionally and irrevocably waives any
right to revoke this Guaranty and acknowledges that this Guaranty is
continuing in nature and applies to all Guaranteed Obligations, whether
existing now or in the future.
(c) Each Guarantor hereby unconditionally and irrevocably waives
(i) any defense arising by reason of any claim or defense based upon an
election of remedies by any Secured Party that in any manner impairs,
reduces, releases or otherwise adversely affects the subrogation,
reimbursement, exoneration, contribution or indemnification rights of such
Guarantor or other rights of such Guarantor to proceed against any of the
other Loan Parties, any other guarantor or any other Person or any
Collateral and (ii) any defense based on any right of set-off or
counterclaim against or in respect of the Obligations of such Guarantor
hereunder.
(d) Each Guarantor acknowledges that the Collateral Agent may, without
notice to or demand upon such Guarantor and without affecting the liability
of such Guarantor under this Guaranty, foreclose under any mortgage by
nonjudicial sale, and each Guarantor hereby waives any defense to the
recovery by the Collateral Agent and the other Secured Parties against such
Guarantor of any deficiency after such nonjudicial sale and any defense or
benefits that may be afforded by applicable law.
(e) Each Guarantor hereby unconditionally and irrevocably waives any
duty on the part of any Secured Party to disclose to such Guarantor any
matter, fact or thing relating to the business, condition (financial or
otherwise), operations, performance, properties or prospects of any other
Loan Party or any of its Subsidiaries now or hereafter known by such
Secured Party.
(f) Each Guarantor acknowledges that it will receive substantial
direct and indirect benefits from the financing arrangements contemplated
by the Loan Documents and that the waivers set forth in Section 8.02 and
this Section 8.03 are knowingly made in contemplation of such benefits.
SECTION 8.04. Subrogation. Each Guarantor hereby unconditionally and
irrevocably agrees not to exercise any rights that it may now have or
hereafter acquire against the Borrower, any other Loan Party or any other
insider guarantor that arise from the existence, payment, performance or
enforcement of such Guarantor's Obligations under or in respect of this
Guaranty or any other Loan Document, including, without limitation, any
right of subrogation, reimbursement, exoneration, contribution or
indemnification and any right to participate in any claim or remedy of any
Secured Party against the Borrower, any other Loan Party or any other
insider guarantor or any Collateral, whether or not such claim, remedy or
right arises in equity or under contract, statute or common law, including,
without limitation, the right to take or receive from the Borrower, any
other Loan Party or any other insider guarantor, directly or indirectly, in
cash or other property or by set-off or in any other manner, payment or
security on account of such claim, remedy or right, unless and until all of
the Guaranteed Obligations and all other amounts payable under this
Guaranty shall have been paid in full in cash, all Letters of Credit and
all Secured Hedge Agreements shall have expired or been terminated and the
Commitments shall have expired or been terminated. If any amount shall be
paid to any Guarantor in violation of the immediately preceding sentence at
any time prior to the latest of (a) the payment in full in cash of the
Guaranteed Obligations and all other amounts payable under this Guaranty,
(b) the Termination Date and (c) the latest date of expiration or
termination of all Letters of Credit and all Secured Hedge Agreements, such
amount shall be received and held in trust for the benefit of the Secured
Parties, shall be segregated from other property and funds of such
Guarantor and shall forthwith be paid or delivered to the Administrative
Agent in the same form as so received (with any necessary endorsement or
assignment) to be credited and applied to the Guaranteed Obligations and
all other amounts payable under this Guaranty, whether matured or
unmatured, in accordance with the terms of the Loan Documents, or to be
held as Collateral for any Guaranteed Obligations or other amounts payable
under this Guaranty thereafter arising. If (i) any Guarantor shall make
payment to any Secured Party of all or any part of the Guaranteed
Obligations, (ii) all of the Guaranteed Obligations and all other amounts
payable under this Guaranty shall have been paid in full in cash, (iii) the
Termination Date shall have occurred and (iv) all Letters of Credit and all
Secured Hedge Agreements shall have expired or been
terminated, the Secured Parties will, at such Guarantor's request and
expense, execute and deliver to such Guarantor appropriate documents,
without recourse and without representation or warranty, necessary to
evidence the transfer by subrogation to such Guarantor of an interest in
the Guaranteed Obligations resulting from such payment made by such
Guarantor pursuant to this Guaranty.
SECTION 8.05. Guaranty Supplements. Upon the execution and delivery by
any Person of a guaranty supplement in substantially the form of Exhibit I
hereto (each, a "Guaranty Supplement"), (a) such Person shall be referred
to as an "Additional Guarantor" and shall become and be a Guarantor
hereunder, and each reference in this Guaranty to a "Guarantor" shall also
mean and be a reference to such Additional Guarantor, and each reference in
any other Loan Document to a "Subsidiary Guarantor" shall also mean and be
a reference to such Additional Guarantor, and (b) each reference herein to
" this Guaranty", "hereunder", "hereof" or words of like import referring
to this Guaranty, and each reference in any other Loan Document to the
"Guaranty", "thereunder", "thereof" or words of like import referring to
this Guaranty, shall mean and be a reference to this Guaranty as
supplemented by such Guaranty Supplement.
SECTION 8.06. Subordination. Each Guarantor hereby subordinates any
and all debts, liabilities and other Obligations owed to such Guarantor by
each other Loan Party (the "Subordinated Obligations") to the Guaranteed
Obligations to the extent and in the manner hereinafter set forth in this
Section 8.06:
(a) Prohibited Payments, Etc. Except during the continuance of a
Default (including the commencement and continuation of any proceeding
under any Bankruptcy Law relating to any other Loan Party), each Guarantor
may receive regularly scheduled payments from any other Loan Party on
account of the Subordinated Obligations. After the occurrence and during
the continuance of any Default (including the commencement and continuation
of any proceeding under any Bankruptcy Law relating to any other Loan
Party), however, unless the Required Lenders otherwise agree, no Guarantor
shall demand, accept or take any action to collect any payment on account
of the Subordinated Obligations.
(b) Prior Payment of Guaranteed Obligations. In any proceeding under
any Bankruptcy Law relating to any other Loan Party, each Guarantor agrees
that the Secured Parties shall be entitled to receive payment in full in
cash of all Guaranteed Obligations (including all interest and expenses
accruing after the commencement of a proceeding under any Bankruptcy Law,
whether or not constituting an allowed claim in such proceeding ("Post
Petition Interest")) before such Guarantor receives payment of any
Subordinated Obligations.
(c) Turn-Over. After the occurrence and during the continuance of any
Default (including the commencement and continuation of any proceeding
under any Bankruptcy Law relating to any other Loan Party), each Guarantor
shall, if the Administrative Agent so requests, collect, enforce and
receive payments on account of the Subordinated Obligations as trustee for
the Secured Parties and deliver such payments to the Administrative Agent
on account of the Guaranteed Obligations (including all Post Petition
Interest), together with any necessary endorsements or other instruments of
transfer, but without reducing or affecting in any manner the liability of
such Guarantor under the other provisions of this Guaranty.
(d) Administrative Agent Authorization. After the occurrence and
during the continuance of any Default (including the commencement and
continuation of any proceeding under any Bankruptcy Law relating to any
other Loan Party), the Administrative Agent is authorized and empowered
(but without any obligation to so do), in its discretion, (i) in the name
of each Guarantor, to collect and enforce, and to submit claims in respect
of, Subordinated Obligations and to apply any amounts received thereon to
the Guaranteed Obligations (including any and all Post Petition Interest),
and (ii) to require each Guarantor (A) to collect and enforce, and to
submit claims in respect of, Subordinated Obligations and (B) to pay any
amounts received on such obligations to the Administrative Agent for
application to the Guaranteed Obligations (including any and all Post
Petition Interest).
SECTION 8.07. Continuing Guaranty; Assignments. This Guaranty is a
continuing guaranty and shall (a) remain in full force and effect until the
latest of (i) the payment in full in cash of the Guaranteed Obligations and
all other amounts payable under this Guaranty, (ii) the Termination Date
and (iii) the latest date of expiration or termination of all Letters of
Credit and all Secured Hedge Agreements, (b) be binding upon the Guarantor,
its successors and assigns and (c) inure to the benefit of and be
enforceable by the Secured Parties and their successors, transferees and
assigns. Without limiting the generality of clause (c) of the immediately
preceding sentence, any Secured Party may assign or otherwise transfer all
or any portion of its rights and obligations under this Agreement
(including, without limitation, all or any portion of its Commitments, the
Advances owing to it and the Note or Notes held by it) to any other Person,
and such other Person shall thereupon become vested with all the benefits
in respect thereof granted to such Secured Party herein or otherwise, in
each case as and to the extent provided in Section 9.07. No Guarantor shall
have the right to assign its rights hereunder or any interest herein
without the prior written consent of the Secured Parties.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Amendments, Etc. No amendment or waiver of any provision
of this Agreement or the Notes or any other Loan Document, nor consent to
any departure by any Loan Party therefrom, shall in any event be effective
unless the same shall be in writing and signed (or, in the case of the
Collateral Documents, consented to) by the Required Lenders, and then such
waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given; provided, however, that (a) no
amendment, waiver or consent shall, unless in writing and signed by all of
the Lender Parties (other than any Lender Party that is, at such time, a
Defaulting Lender), do any of the following at any time: (i) waive any of
the conditions specified in Section 3.01 or, in the case of the Initial
Extension of Credit, Section 3.02, (ii) change the number of Lenders or the
percentage of (x) the Commitments, (y) the aggregate unpaid principal
amount of the Advances or (z) the aggregate Available Amount of outstanding
Letters of Credit that, in each case, shall be required for the Lenders or
any of them to take any action hereunder, (iii) reduce or limit the
obligations of any Guarantor under Section 7.01 or release such Guarantor
or otherwise limit such Guarantor's liability with respect to the
Obligations owing to the Agents and the Lender Parties except in connection
with transactions otherwise permitted hereunder, (iv) release all or
substantially all of the Collateral in
any transaction or series of related transactions, (v) amend Section 2.13
or this Section 8.01, (vi) increase the Commitments of the Lenders,
(vii) reduce the principal of, or interest on, the Notes or any fees or
other amounts payable hereunder, (viii) postpone any date scheduled for any
payment of principal of, or interest on, the Notes pursuant to Section 2.04
or 2.07 or any date fixed for payment of fees or other amounts payable
hereunder, or (ix) limit the liability of any Loan Party under any of the
Loan Documents and (b) no amendment, waiver or consent shall, unless in
writing and signed by the Required Lenders and each Lender (other than any
Lender that is, at such time, a Defaulting Lender) that has a Commitment
under, or is owed any amounts under or in respect of, the Term B Facility
or the Revolving Credit Facility if such Lender is directly and adversely
affected by such amendment, waiver or consent: (i) increase the Commitments
of such Lender; (ii) reduce the principal of, or stated rate of interest
on, the Notes held by such Lender or any fees or other amounts stated to be
payable hereunder to such Lender; or (iii) postpone any date scheduled for
any payment of principal of, or interest on, the Notes pursuant to Section
2.04 or 2.07 or any date fixed for any payment of fees hereunder or any
Guaranteed Obligations payable under the Subsidiary Guaranty; provided
further that no amendment, waiver or consent shall, unless in writing and
signed by the Swing Line Bank or the Issuing Bank, as the case may be, in
addition to the Lenders required above to take such action, affect the
rights or obligations of the Swing Line Bank or of the Issuing Bank, as the
case may be, under this Agreement; and provided further that no amendment,
waiver or consent shall, unless in writing and signed by an Agent in
addition to the Lenders required above to take such action, affect the
rights or duties of such Agent under this Agreement or the other Loan
Documents.
SECTION 9.02. Notices, Etc. All notices and other communications
provided for hereunder shall be in writing (including telegraphic,
telecopy, facsimile, or e-mail communication) and mailed, telegraphed,
telecopied, telexed, faxed or delivered, if to Parent or the Borrower, at
its address at P.O. Box 219335, Kansas City, Missouri 64121-9335,
Attention: Vice President and Treasurer (Facsimile No. (816) 983-1198),
with a copy to the Executive Vice President and Chief Financial Officer
(Facsimile No. (816) 983-1297), if to any Initial Lender Party, at its
Domestic Lending Office specified opposite its name on Schedule I hereto;
if to any other Lender Party, at its Domestic Lending Office specified in
the Assignment and Acceptance pursuant to which it became a Lender Party;
if to the Collateral Agent, at its address at 600 Peach Street, N.E., Suite
2700, Atlanta, GA 30308, Attention: Eudia Smith , E-mail Address:
eudia_smith@scotiacapital.com; if to the Administrative Agent, at its
address at 600 Peach Street, N.E., Suite 2700, Atlanta, GA 30308,
Attention: Eudia Smith , E-mail Address: eudia_smith@scotiacapital.com;
or, as to any party, at such other address as shall be designated by such
party in a written notice to the other parties. All such notices and other
communications shall, when mailed, telegraphed, telecopied, telexed, faxed
or E-mailed, be effective when deposited in the mails, delivered to the
telegraph company, transmitted by telecopier or facsimile or confirmed by
telex answerback, respectively, except that notices and communications to
any Agent pursuant to Article II, III or VII shall not be effective until
received by such Agent. Delivery by facsimile of an executed counterpart of
a signature page to any amendment or waiver of any provision of this
Agreement or the Notes or of any Exhibit hereto to be executed and
delivered hereunder shall be effective as delivery of an original executed
counterpart thereof.
SECTION 9.03. No Waiver; Remedies. No failure on the part of any
Lender Party or any Agent to exercise, and no delay in exercising, any
right hereunder or under any Note or any
other Loan Document shall operate as a waiver thereof; nor shall any single
or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
SECTION 9.04. Costs and Expenses. (a) The Borrower agrees to pay on
demand (i) all reasonable costs and expenses of each Agent in connection
with the preparation, execution, delivery, administration, modification and
amendment of, or any consent or waiver under, the Loan Documents
(including, without limitation, (A) all due diligence, collateral review,
syndication, transportation, computer, duplication, appraisal, audit,
insurance, consultant, search, filing and recording fees and expenses and
(B) the reasonable fees and expenses of counsel for each Agent with respect
thereto, with respect to advising such Agent as to its rights and
responsibilities, or the perfection, protection or preservation of rights
or interests, under the Loan Documents, with respect to negotiations with
any Loan Party or with other creditors of any Loan Party or any of its
Subsidiaries arising out of any Default or any events or circumstances that
may give rise to a Default and with respect to presenting claims in or
otherwise participating in or monitoring any bankruptcy, insolvency or
other similar proceeding involving creditors' rights generally and any
proceeding ancillary thereto) and (ii) all costs and expenses of each Agent
and each Lender Party in connection with the enforcement of the Loan
Documents, whether in any action, suit or litigation, or any bankruptcy,
insolvency or other similar proceeding affecting creditors' rights
generally (including, without limitation, the reasonable fees and expenses
of counsel for the Administrative Agent and each Lender Party with respect
thereto).
(b) The Borrower agrees to indemnify, defend and save and hold
harmless each Agent, each Lender Party and each of their Affiliates and
their respective officers, directors, employees, agents and advisors (each,
an "Indemnified Party") from and against, and shall pay on demand, any and
all claims, damages, losses, liabilities and expenses (including, without
limitation, reasonable fees and expenses of counsel) that may be incurred
by or asserted or awarded against any Indemnified Party, in each case
arising out of or in connection with or by reason of (including, without
limitation, in connection with any investigation, litigation or proceeding
or preparation of a defense in connection therewith) (i) the Facilities,
the actual or proposed use of the proceeds of the Advances or the Letters
of Credit, the Transaction Documents or any of the transactions
contemplated thereby or (ii) the actual or alleged presence of Hazardous
Materials on any property of any Loan Party or any of its Subsidiaries or
any Environmental Action relating in any way to any Loan Party or any of
its Subsidiaries, except to the extent such claim, damage, loss, liability
or expense is found in a final, non-appealable judgment by a court of
competent jurisdiction to have resulted from such Indemnified Party's gross
negligence or willful misconduct. In the case of an investigation,
litigation or other proceeding to which the indemnity in this Section
9.04(b) applies, such indemnity shall be effective whether or not such
investigation, litigation or proceeding is brought by any Loan Party, its
directors, shareholders or creditors or an Indemnified Party or any other
Person, whether or not any Indemnified Party is otherwise a party thereto
and whether or not the Transaction is consummated. The Borrower also agrees
not to assert any claim against any Agent, any Lender Party or any of their
Affiliates, or any of their respective officers, directors, employees,
agents and advisors, on any theory of liability, for special, indirect,
consequential or punitive damages arising out of or otherwise relating to
the Facilities, the actual or proposed use
of the proceeds of the Advances or the Letters of Credit, the Transaction
Documents or any of the transactions contemplated by the Transaction
Documents.
(c) If any payment of principal of, or Conversion of, any Eurodollar
Rate Advance is made by the Borrower to or for the account of a Lender
Party other than on the last day of the Interest Period for such Advance,
as a result of a payment or Conversion pursuant to Section 2.06, 2.09(b)(i)
or 2.10(d), acceleration of the maturity of the Notes pursuant to
Section 6.01 or for any other reason, or if the Borrower fails to make any
payment or prepayment of an Advance for which a notice of prepayment has
been given or that is otherwise required to be made, whether pursuant to
Section 2.04, 2.06 or 6.01 or otherwise, the Borrower shall, upon demand by
such Lender Party (with a copy of such demand to the Administrative Agent),
pay to the Administrative Agent for the account of such Lender Party any
amounts required to compensate such Lender Party for any additional losses,
costs or expenses that it may reasonably incur as a result of such payment
or Conversion or such failure to pay or prepay, as the case may be,
including, without limitation, any loss, cost or expense incurred by reason
of the liquidation or reemployment of deposits or other funds acquired by
any Lender Party to fund or maintain such Advance.
(d) If any Loan Party fails to pay when due any costs, expenses or
other amounts payable by it under any Loan Document, including, without
limitation, fees and expenses of counsel and indemnities, such amount may
be paid on behalf of such Loan Party by the Administrative Agent or any
Lender Party, in its sole discretion.
(e) Without prejudice to the survival of any other agreement of any
Loan Party hereunder or under any other Loan Document, the agreements and
obligations of the Borrower contained in Sections 2.10 and 2.12 and this
Section 9.04 shall survive the payment in full of principal, interest and
all other amounts payable hereunder and under any of the other Loan
Documents.
SECTION 9.05. Right of Set-off. Upon (a) the occurrence and during the
continuance of any Event of Default and (b) the making of the request or
the granting of the consent specified by Section 6.01 to authorize the
Administrative Agent to declare the Notes due and payable pursuant to the
provisions of Section 6.01, each Agent and each Lender Party and each of
their respective Affiliates is hereby authorized at any time and from time
to time, to the fullest extent permitted by law, to set off and otherwise
apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by such
Agent, such Lender Party or such Affiliate to or for the credit or the
account of the Borrower against any and all of the Obligations of the
Borrower then due under the Loan Documents. Each Agent and each Lender
Party agrees promptly to notify the Borrower after any such set-off and
application; provided, however, that the failure to give such notice shall
not affect the validity of such set-off and application. The rights of each
Agent and each Lender Party and their respective Affiliates under this
Section are in addition to other rights and remedies (including, without
limitation, other rights of set-off) that such Agent, such Lender Party and
their respective Affiliates may have.
SECTION 9.06. Binding Effect. This Agreement shall become effective
when it shall have been executed by the Borrower and each Agent and the
Administrative Agent shall have
been notified by each Initial Lender Party that such Initial Lender Party
has executed it and thereafter shall be binding upon and inure to the
benefit of the Borrower, each Agent and each Lender Party and their
respective successors and assigns, except that the Borrower shall not have
the right to assign its rights hereunder or any interest herein without the
prior written consent of the Lender Parties.
SECTION 9.07. Assignments and Participations. (a) Each Lender may
assign to one or more Eligible Assignees all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment or Commitments, the Advances owing to it and the
Note or Notes held by it); provided, however, that (i) each such assignment
shall be of a uniform, and not a varying, percentage of all rights and
obligations under and in respect of any or all Facilities, (ii) except in
the case of an assignment to a Person that, immediately prior to such
assignment, was a Lender, an Affiliate of any Lender or an Approved Fund of
any Lender or an assignment of all of a Lender's rights and obligations
under this Agreement, the aggregate amount of the Commitments being
assigned to such Eligible Assignee pursuant to such assignment (determined
as of the date of the Assignment and Acceptance with respect to such
assignment) shall in no event be less than 1,000,000 (or such lesser amount
as shall be approved by the Administrative Agent and, so long as no Default
shall have occurred and be continuing at the time of effectiveness of such
assignment, the Borrower) under each Facility for which a Commitment is
being assigned, (iii) each such assignment shall be to an Eligible
Assignee, (iv) no such assignments shall be permitted without the consent
of the Administrative Agent until the Administrative Agent shall have
notified the Lender Parties that syndication of the Commitments hereunder
has been completed and (v) the parties to each such assignment shall
execute and deliver to the Administrative Agent, for its acceptance and
recording in the Register, an Assignment and Acceptance, together with any
Note or Notes subject to such assignment and a processing and recordation
fee of $3,500.
(b) Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in such Assignment and Acceptance,
(i) the assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, have the rights and obligations of a Lender or
Issuing Bank, as the case may be, hereunder and (ii) the Lender or Issuing
Bank assignor thereunder shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such Assignment and
Acceptance, relinquish its rights (other than its rights under
Sections 2.10, 2.12 and 9.04 to the extent any claim thereunder relates to
an event arising prior to such assignment) and be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the remaining portion of an assigning Lender's
or Issuing Bank's rights and obligations under this Agreement, such Lender
or Issuing Bank shall cease to be a party hereto).
(c) By executing and delivering an Assignment and Acceptance, each
Lender Party assignor thereunder and each assignee thereunder confirm to
and agree with each other and the other parties thereto and hereto as
follows: (i) other than as provided in such Assignment and Acceptance, such
assigning Lender Party makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with any Loan Document or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of, or the perfection or priority of any lien or security interest
created or purported to be created under or in connection with, any Loan
Document or any other instrument or document furnished pursuant thereto;
(ii) such assigning Lender Party makes no representation or warranty and
assumes no responsibility with respect to the financial condition of any
Loan Party or the performance or observance by any Loan Party of any of its
obligations under any Loan Document or any other instrument or document
furnished pursuant thereto; (iii) such assignee confirms that it has
received a copy of this Agreement, together with copies of the financial
statements referred to in Section 4.01 and such other documents and
information as it has deemed appropriate to make its own credit analysis
and decision to enter into such Assignment and Acceptance; (iv) such
assignee will, independently and without reliance upon any Agent, such
assigning Lender Party or any other Lender Party and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action
under this Agreement; (v) such assignee confirms that it is an Eligible
Assignee; (vi) such assignee appoints and authorizes each Agent to take
such action as agent on its behalf and to exercise such powers and
discretion under the Loan Documents as are delegated to such Agent by the
terms hereof and thereof, together with such powers and discretion as are
reasonably incidental thereto; and (vii) such assignee agrees that it will
perform in accordance with their terms all of the obligations that by the
terms of this Agreement are required to be performed by it as a Lender or
Issuing Bank, as the case may be.
(d) The Administrative Agent , acting for this purpose (but only for
this purpose) as the agent of the Borrower, shall maintain at its address
referred to in Section 9.02 a copy of each Assignment and Acceptance
delivered to and accepted by it and a register for the recordation of the
names and addresses of the Lender Parties and the Commitment under each
Facility of, and principal amount of the Advances owing under each Facility
to, each Lender Party from time to time (the "Register"). The entries in
the Register shall be conclusive and binding for all purposes, absent
manifest error, and the Borrower, the Agents and the Lender Parties shall
treat each Person whose name is recorded in the Register as a Lender Party
hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower or any Agent or any Lender Party
at any reasonable time and from time to time upon reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender Party and an assignee, together with any Note or Notes
subject to such assignment, the Administrative Agent shall, if such
Assignment and Acceptance has been completed and is in substantially the
form of Exhibit C hereto, (i) accept such Assignment and Acceptance,
(ii) record the information contained therein in the Register and
(iii) give prompt notice thereof to the Borrower and each other Agent. In
the case of any assignment by a Lender, within five Business Days after its
receipt of such notice, the Borrower, at its own expense, shall execute and
deliver to the Administrative Agent in exchange for the surrendered Note or
Notes a new Note to the order of such Eligible Assignee in an amount equal
to the Commitment assumed by it under each Facility pursuant to such
Assignment and Acceptance and, if any assigning Lender has retained a
Commitment hereunder under such Facility, a new Note to the order of such
assigning Lender in an amount equal to the Commitment retained by it
hereunder. Such new Note or Notes shall be in an aggregate principal amount
equal to the aggregate principal amount of such surrendered Note or Notes,
shall be dated the effective date of such Assignment and Acceptance and
shall otherwise be in substantially the form of Exhibit A-1 or A-2 hereto,
as the case may be.
(f) The Issuing Bank may assign to an Eligible Assignee all of its
rights and obligations under the undrawn portion of its Letter of Credit
Commitment at any time; provided, however, that each such assignment shall
be to an Eligible Assignee and the parties to each such assignment shall
execute and deliver to the Administrative Agent, for its acceptance and
recording in the Register, an Assignment and Acceptance, together with a
processing and recordation fee of $3,500.
(g) Each Lender Party may sell participations to one or more Persons
(other than any Loan Party or any of its Affiliates) in or to all or a
portion of its rights and obligations under this Agreement (including,
without limitation, all or a portion of its Commitments, the Advances owing
to it and the Note or Notes (if any) held by it); provided, however, that
(i) such Lender Party's obligations under this Agreement (including,
without limitation, its Commitments) shall remain unchanged, (ii) such
Lender Party shall remain solely responsible to the other parties hereto
for the performance of such obligations, (iii) such Lender Party shall
remain the holder of any such Note for all purposes of this Agreement,
(iv) the Borrower, the Agents and the other Lender Parties shall continue
to deal solely and directly with such Lender Party in connection with such
Lender Party's rights and obligations under this Agreement and (v) no
participant under any such participation shall have any right to approve
any amendment or waiver of any provision of any Loan Document, or any
consent to any departure by any Loan Party therefrom, except to the extent
that such amendment, waiver or consent would reduce the principal of, or
interest on, the Notes or any fees or other amounts payable hereunder, in
each case to the extent subject to such participation, postpone any date
fixed for any payment of principal of, or interest on, the Notes or any
fees or other amounts payable hereunder, in each case to the extent subject
to such participation, or release all or substantially all of the
Collateral.
(h) Any Lender Party may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this
Section 9.07, disclose to the assignee or participant or proposed assignee
or participant any information relating to the Borrower furnished to such
Lender Party by or on behalf of the Borrower; provided, however, that,
prior to any such disclosure, the assignee or participant or proposed
assignee or participant shall agree to preserve the confidentiality of any
Confidential Information received by it from such Lender Party.
(i) Notwithstanding any other provision set forth in this Agreement,
any Lender Party may at any time create a security interest in all or any
portion of its rights under this Agreement (including, without limitation,
the Advances owing to it and the Note or Notes held by it), including
without limitation, in favor of any Federal Reserve Bank in accordance with
Regulation A of the Board of Governors of the Federal Reserve System.
(j) Notwithstanding anything to the contrary contained herein, any
Lender that is a fund that invests in bank loans may create a security
interest in all or any portion of the Advances owing to it and the Note or
Notes held by it to the trustee for holders of obligations owed, or
securities issued, by such fund as security for such obligations or
securities, provided, that unless and until such trustee actually becomes a
Lender in compliance with the other provisions of this Section 9.07, (i) no
such pledge shall release the pledging Lender from any of its obligations
under the Loan Documents and (ii) such trustee shall not be entitled to
exercise
any of the rights of a Lender under the Loan Documents even though such
trustee may have acquired ownership rights with respect to the pledged
interest through foreclosure or otherwise.
(k) Notwithstanding anything to the contrary contained herein, any
Lender Party (a "Granting Lender") may grant to a special purpose funding
vehicle identified as such in writing from time to time by the Granting
Lender to the Administrative Agent and the Borrower (an "SPC") the option
to provide all or any part of any Advance that such Granting Lender would
otherwise be obligated to make pursuant to this Agreement, provided that
(i) nothing herein shall constitute a commitment by any SPC to fund any
Advance, and (ii) if an SPC elects not to exercise such option or otherwise
fails to make all or any part of such Advance, the Granting Lender shall be
obligated to make such Advance pursuant to the terms hereof. The making of
an Advance by an SPC hereunder shall utilize the Commitment of the Granting
Lender to the same extent, and as if, such Advance were made by such
Granting Lender. Each party hereto hereby agrees that (i) no SPC shall be
liable for any indemnity or similar payment obligation under this Agreement
for which a Lender Party would be liable, (ii) no SPC shall be entitled to
the benefits of Sections 2.10 and 2.12 (or any other increased costs
protection provision) and (iii) the Granting Bank shall for all purposes,
including, without limitation, the approval of any amendment or waiver of
any provision of any Loan Document, remain the Lender Party of record
hereunder. In furtherance of the foregoing, each party hereto hereby agrees
(which agreement shall survive the termination of this Agreement) that,
prior to the date that is one year and one day after the payment in full of
all outstanding commercial paper or other senior Debt of any SPC, it will
not institute against, or join any other person in instituting against,
such SPC any bankruptcy, reorganization, arrangement, insolvency, or
liquidation proceeding under the laws of the United States or any State
thereof. Notwithstanding anything to the contrary contained in this
Agreement, any SPC may (i) with notice to, but without prior consent of,
the Borrower and the Administrative Agent and with the payment of a
processing fee of $500, assign all or any portion of its interest in any
Advance to the Granting Lender and (ii) disclose on a confidential basis
any non-public information relating to its funding of Advances to any
rating agency, commercial paper dealer or provider of any surety or
guarantee or credit or liquidity enhancement to such SPC. This subsection
(k) may not be amended without the prior written consent of each Granting
Lender, all or any part of whose Advances are being funded by the SPC at
the time of such amendment.
SECTION 9.08. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be
an original and all of which taken together shall constitute one and the
same agreement. Delivery by telecopier of an executed counterpart of a
signature page to this Agreement shall be effective as delivery of an
original executed counterpart of this Agreement.
SECTION 9.09. No Liability of the Issuing Bank. The Borrower assumes
all risks of the acts or omissions of any beneficiary or transferee of any
Letter of Credit with respect to its use of such Letter of Credit. Neither
the Issuing Bank nor any of its officers or directors shall be liable or
responsible for: (a) the use that may be made of any Letter of Credit or
any acts or omissions of any beneficiary or transferee in connection
therewith; (b) the validity, sufficiency or genuineness of documents, or of
any endorsement thereon, even if such documents should prove to be in any
or all respects invalid, insufficient, fraudulent or forged; (c) payment by
the Issuing
Bank against presentation of documents that do not strictly comply with the
terms of a Letter of Credit, including failure of any documents to bear any
reference or adequate reference to the Letter of Credit; or (d) any other
circumstances whatsoever in making or failing to make payment under any
Letter of Credit, except that the Borrower shall have a claim against the
Issuing Bank, and the Issuing Bank shall be liable to the Borrower, to the
extent of any direct, but not consequential, damages suffered by the
Borrower that the Borrower proves were caused by (i) the Issuing Bank's
willful misconduct or gross negligence as determined in a final,
non-appealable judgment by a court of competent jurisdiction in determining
whether documents presented under any Letter of Credit comply with the
terms of the Letter of Credit or (ii) the Issuing Bank's willful failure to
make lawful payment under a Letter of Credit after the presentation to it
of a draft and certificates strictly complying with the terms and
conditions of the Letter of Credit. In furtherance and not in limitation of
the foregoing, the Issuing Bank may accept documents that appear on their
face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary.
SECTION 9.10. Confidentiality. Neither any Agent nor any Lender Party
shall disclose any Confidential Information to any Person without the
consent of the Borrower, other than (a) to such Agent's or such Lender
Party's Affiliates and their officers, directors, employees, agents and
advisors and to actual or prospective Eligible Assignees and participants,
and then only on a confidential basis, (b) as required by any law, rule or
regulation or judicial process, (c) as requested or required by any state,
Federal or foreign authority or examiner (including the National
Association of Insurance Commissioners or any similar organization or
quasi-regulatory authority) regulating such Lender Party, (d) to any rating
agency when required by it, provided that, prior to any such disclosure,
such rating agency shall undertake to preserve the confidentiality of any
Confidential Information relating to the Loan Parties received by it from
such Lender Party, (e) in connection with the exercise of any right or
remedy under this Agreement or any other Loan Document or (f) to any direct
or indirect contractual counterparty in swap agreements or such contractual
counterparty's professional advisor (so long as such contractual
counterparty or professional advisor agrees to be bound by the provisions
of this Section 9.10).
SECTION 9.11. Release of Collateral and Guarantees. In the event that
Parent or any Subsidiary sells, transfers or otherwise disposes of all or
any portion of any of the Equity Interests, assets or property owned by
Parent or such Subsidiary in a transaction not prohibited by this
Agreement, the Administrative Agent and the Collateral Agent shall promptly
(and the Lenders hereby authorize and instruct the Administrative Agent and
the Collateral Agent to) take such action and execute any such documents as
may be reasonably requested by the Borrower to release any Liens created by
any Loan Document in respect of such Equity Interests, assets or property,
including the release and satisfaction of record of any mortgage or deed of
trust granted in connection herewith, and, in the case of a disposition of
all or substantially all the Equity Interests or assets of any Subsidiary
that is a Loan Party, to terminate such Subsidiary's Obligations under the
Guaranty and each other Loan Document. In addition, the Administrative
Agent and the Collateral Agent will take such actions as are reasonably
requested by the Borrower to terminate the Liens and security interests
created by the Loan Documents when all the Obligations have been paid in
full and all Letters of Credit and Commitments have been terminated. The
Borrower agrees to pay all out-of-pocket expenses of the Administrative
Agent
and the Collateral Agent in connection with releases of Liens and
Obligations under the Guaranty provided for in this Section.
SECTION 9.12. Jurisdiction, Etc. (a) Each of the parties hereto hereby
irrevocably and unconditionally submits, for itself and its property, to
the nonexclusive jurisdiction of any New York State court or Federal court
of the United States of America sitting in New York City, and any appellate
court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or any of the other Loan Documents to which it
is a party, or for recognition or enforcement of any judgment, and each of
the parties hereto hereby irrevocably and unconditionally agrees that all
claims in respect of any such action or proceeding may be heard and
determined in any such New York State court or, to the fullest extent
permitted by law, in such Federal court. Each of the parties hereto agrees
that a final judgment in any such action or proceeding shall be conclusive
and may be enforced in other jurisdictions by suit on the judgment or in
any other manner provided by law. Nothing in this Agreement shall affect
any right that any party may otherwise have to bring any action or
proceeding relating to this Agreement or any of the other Loan Documents in
the courts of any jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally waives,
to the fullest extent it may legally and effectively do so, any objection
that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or any of
the other Loan Documents to which it is a party in any New York State or
Federal court. Each of the parties hereto hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to
the maintenance of such action or proceeding in any such court.
SECTION 9.13. Governing Law. This Agreement and the Notes shall be
governed by, and construed in accordance with, the laws of the State of
New York.
SECTION 9.14. Waiver of Jury Trial. Each of the Borrower, the Agents
and the Lender Parties irrevocably waives all right to trial by jury in any
action, proceeding or counterclaim (whether based on contract, tort or
otherwise) arising out of or relating to any of the Loan Documents, the
Advances, the Letters of Credit or the actions of any Agent or any Lender
Party in the negotiation, administration, performance or enforcement
thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized, as of
the date first above written.
THE KANSAS CITY SOUTHERN RAILWAY COMPANY
By ______________________________
Title:
THE BANK OF NOVA SCOTIA,
as Administrative Agent
By ______________________________
Title:
THE BANK OF NOVA SCOTIA,
as Collateral Agent
By ______________________________
Title:
Initial Lenders
MORGAN STANLEY SENIOR FUNDING INC.
By ______________________________
Title:
[NAME OF INITIAL LENDER]
By ______________________________
Title:
[NAME OF INITIAL LENDER]
By ______________________________
Title:
Initial Issuing Bank
THE BANK OF NOVA SCOTIA
By ______________________________
Title:
[ETC.]
Guarantors
[NAME OF GUARANTOR]
By ______________________________
Title:
SCHEDULE I
COMMITMENTS AND APPLICABLE LENDING OFFICES
======================== =========== ======================= ===================== ======================= =======================
Name of Initial Lender Term B Revolving Letter of Domestic Eurodollar
Credit Credit Lending Lending
Commitment Commitment Commitment Office Office
======================== =========== ======================= ===================== ======================= =======================
======================== =========== ======================= ===================== ======================= =======================
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
- ------------------------ ----------- ----------------------- --------------------- ----------------------- -----------------------
======================== =========== ======================= ===================== ======================= =======================
EXECUTION COPY
$250,000,000
CREDIT AGREEMENT
Dated as of March 30, 2004
Among
THE KANSAS CITY SOUTHERN RAILWAY COMPANY
as Borrower
THE GUARANTORS NAMED HEREIN
as Guarantors
and
THE INITIAL LENDERS, INITIAL ISSUING BANK AND SWING LINE BANK NAMED HEREIN
as Initial Lenders, Initial Issuing Bank and Swing Line Bank
and
THE BANK OF NOVA SCOTIA
as Collateral Agent
and
THE BANK OF NOVA SCOTIA
as Administrative Agent
and
MORGAN STANLEY SENIOR FUNDING, INC.
as Syndication Agent
and
MORGAN STANLEY SENIOR FUNDING, INC. AND THE BANK OF NOVA SCOTIA
as Joint Lead Arrangers and Joint Bookrunners
and
HARRIS TRUST AND SAVINGS BANK
as Documentation Agent
T A B L E O F C O N T E N T S
Section Page
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms...............................................................................1
SECTION 1.02. Computation of Time Periods; Other Definitional Provisions.........................................28
SECTION 1.03. Accounting Terms...................................................................................28
SECTION 1.04. Currency Equivalents Generally.....................................................................28
ARTICLE II AMOUNTS AND TERMS OF THE ADVANCES AND THE LETTERS OF CREDIT
SECTION 2.01. The Advances and the Letters of Credit.............................................................28
SECTION 2.02. Making the Advances................................................................................30
SECTION 2.03. Issuance of and Drawings and Reimbursement Under Letters of Credit.................................33
SECTION 2.04. Repayment of Advances..............................................................................34
SECTION 2.05. Termination or Reduction of the Commitments........................................................36
SECTION 2.06. Prepayments........................................................................................37
SECTION 2.07. Interest...........................................................................................38
SECTION 2.08. Fees...............................................................................................39
SECTION 2.09. Conversion of Advances.............................................................................40
SECTION 2.10. Increased Costs, Etc...............................................................................41
SECTION 2.11. Payments and Computations..........................................................................42
SECTION 2.12. Taxes..............................................................................................45
SECTION 2.13. Sharing of Payments, Etc...........................................................................46
SECTION 2.14. Use of Proceeds....................................................................................46
SECTION 2.15. Defaulting Lenders.................................................................................47
SECTION 2.16. Evidence of Debt...................................................................................49
ARTICLE III CONDITIONS OF LENDING AND ISSUANCES OF LETTERS OF CREDIT
SECTION 3.01. Conditions Precedent to Initial Extension of Credit................................................51
SECTION 3.02. Conditions Precedent to Each Borrowing and Issuance and Renewal....................................54
SECTION 3.03. Determinations Under Section 3.01..................................................................55
ARTICLE IV REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of Parent and the Borrower..........................................55
ARTICLE V COVENANTS OF THE BORROWEr and parent
SECTION 5.01. Affirmative Covenants..............................................................................60
SECTION 5.02. Negative Covenants.................................................................................66
SECTION 5.03. Reporting Requirements.............................................................................74
SECTION 5.04. Financial Covenants................................................................................76
ARTICLE VI EVENTS OF DEFAULT
SECTION 6.01. Events of Default..................................................................................78
SECTION 6.02. Actions in Respect of the Letters of Credit upon Default...........................................80
ARTICLE VII THE AGENTS
SECTION 7.01. Authorization and Action...........................................................................81
SECTION 7.02. Agents' Reliance, Etc..............................................................................82
SECTION 7.03. BNS, Morgan Stanley and Affiliates.................................................................82
SECTION 7.04. Lender Party Credit Decision.......................................................................83
SECTION 7.05. Indemnification....................................................................................83
SECTION 7.06. Successor Agents...................................................................................84
ARTICLE VIII GUARANTY
SECTION 8.01. Guaranty; Limitation of Liability..................................................................85
SECTION 8.02. Guaranty Absolute..................................................................................86
SECTION 8.03. Waivers and Acknowledgments........................................................................87
SECTION 8.04. Subrogation........................................................................................88
SECTION 8.05. Guaranty Supplements...............................................................................89
SECTION 8.06. Subordination......................................................................................89
SECTION 8.07. Continuing Guaranty; Assignments...................................................................90
ARTICLE IX MISCELLANEOUS
SECTION 9.01. Amendments, Etc....................................................................................90
SECTION 9.02. Notices, Etc.......................................................................................91
SECTION 9.03. No Waiver; Remedies................................................................................91
SECTION 9.04. Costs and Expenses.................................................................................92
SECTION 9.05. Right of Set-off...................................................................................93
SECTION 9.06. Binding Effect.....................................................................................93
SECTION 9.07. Assignments and Participations.....................................................................94
SECTION 9.08. Execution in Counterparts..........................................................................97
SECTION 9.09. No Liability of the Issuing Bank...................................................................97
SECTION 9.10. Confidentiality....................................................................................98
SECTION 9.11. Release of Collateral..............................................................................98
SECTION 9.12. Jurisdiction, Etc..................................................................................99
SECTION 9.13. Governing Law......................................................................................99
SECTION 9.14. Waiver of Jury Trial...............................................................................99
SCHEDULES
Schedule I - Commitments and Applicable Lending Offices
Schedule II - Subsidiary Guarantors
Schedule 4.01(b) - Subsidiaries
Schedule 4.01(d) - Authorizations, Approvals, Actions, Notices and Filings
Schedule 4.01(q) - Environmental Disclosure
Schedule 4.01(s) - Existing Debt
Schedule 4.01(t) - Surviving Debt
Schedule 4.01(u) - Liens
Schedule 4.01(v) - Owned Real Property
Schedule 4.01(w)(i) - Leased Real Property (Lessee)
Schedule 4.01(w)(ii) - Leased Real Property (Lessor)
Schedule 4.01(w)(iii) - Property with Title Insurance
Schedule 4.01(w)(iv) - Property with Surveys
Schedule 4.01(x) - Investments
Schedule 4.01(y) - Intellectual Property
EXHIBITS
Exhibit A-1 - Form of Revolving Credit Note
Exhibit A-2 - Form of Term B Note
Exhibit B - Form of Notice of Borrowing
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Security Agreement
Exhibit E - Form of Mortgage
Exhibit F - Form of Solvency Certificate
Exhibit G - Form of Opinion of Counsel to the Loan Parties
Exhibit H - Form of Opinion of Local Counsel to the Loan Parties
Exhibit I - Form of Guaranty Supplement