EXHIBIT 10.4
CONFORMED COPY
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$150,000,000
CREDIT AGREEMENT
dated as of June 17, 2004
among
HENRY SCHEIN, INC.,
as Borrower,
The Several Guarantors from Time to Time Parties Hereto,
The Several Lenders Party Hereto,
JPMORGAN CHASE BANK,
as Administrative Agent,
and
LEHMAN COMMERCIAL PAPER INC.,
as Syndication Agent
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J.P. MORGAN SECURITIES INC.,
as Lead Arranger and Joint Bookrunner,
LEHMAN BROTHERS INC.,
as Lead Arranger and Joint Bookrunner
TABLE OF CONTENTS
PAGE
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SECTION 1. DEFINITIONS........................................................................................... 1
1.1 Defined Terms.................................................................................. 1
1.2 Other Definitional Provisions.................................................................. 16
1.3 Rounding....................................................................................... 17
1.4 References to Agreements and Laws.............................................................. 18
SECTION 2. AMOUNT AND TERMS OF LOANS............................................................................. 18
2.1 Loans.......................................................................................... 18
2.2 Procedure for Borrowing........................................................................ 18
2.3 Fees........................................................................................... 19
2.4 Termination or Reduction of Commitments........................................................ 19
2.5 Repayment of Loans............................................................................. 19
SECTION 3. CERTAIN PROVISIONS APPLICABLE TO THE LOANS............................................................ 20
3.1 Optional and Mandatory Prepayments............................................................. 20
3.2 Conversion and Continuation Options............................................................ 21
3.3 Maximum Number of Tranches..................................................................... 21
3.4 Interest Rates and Payment Dates............................................................... 21
3.5 Computation of Interest and Fees............................................................... 22
3.6 Inability to Determine Interest Rate........................................................... 22
3.7 Pro Rata Treatment and Payments................................................................ 23
3.8 Illegality..................................................................................... 24
3.9 Requirements of Law............................................................................ 24
3.10 Taxes.......................................................................................... 25
3.11 Break Funding Payments......................................................................... 27
3.12 Change of Lending Office; Removal of Lender.................................................... 28
3.13 Evidence of Debt............................................................................... 28
SECTION 4. REPRESENTATIONS AND WARRANTIES........................................................................ 29
4.1 Financial Condition............................................................................ 29
4.2 No Change...................................................................................... 30
4.3 Corporate Existence; Compliance with Law....................................................... 30
4.4 Corporate Power; Authorization; Enforceable Obligations........................................ 30
4.5 No Legal Bar................................................................................... 30
4.6 No Material Litigation......................................................................... 31
4.7 No Default..................................................................................... 31
4.8 Taxes.......................................................................................... 31
4.9 Purpose of Loans............................................................................... 31
4.10 Environmental Matters.......................................................................... 32
4.11 Disclosure..................................................................................... 33
4.12 Ownership of Property; Liens................................................................... 33
4.13 ERISA Compliance............................................................................... 33
4.14 Subsidiaries................................................................................... 34
4.15 Margin Regulations; Investment Company Act; Public Utility Holding Company Act................. 34
SECTION 5. CONDITIONS PRECEDENT.................................................................................. 35
5.1 Conditions to Loans............................................................................ 35
SECTION 6. AFFIRMATIVE COVENANTS................................................................................. 37
6.1 Financial Statements........................................................................... 37
6.2 Certificates; Other Information................................................................ 38
6.3 Conduct of Business and Maintenance of Existence............................................... 39
6.4 Payment of Obligations......................................................................... 39
6.5 Maintenance of Properties...................................................................... 39
6.6 Maintenance of Insurance....................................................................... 40
6.7 Books and Records.............................................................................. 40
6.8 Inspection Rights.............................................................................. 40
6.9 Compliance with ERISA.......................................................................... 40
6.10 Environmental Compliance....................................................................... 41
6.11 Use of Proceeds................................................................................ 41
6.12 Notices........................................................................................ 41
6.13 Additional Guarantors.......................................................................... 42
SECTION 7. NEGATIVE COVENANTS.................................................................................... 42
7.1 Financial Covenants............................................................................ 42
7.2 Limitation on Liens............................................................................ 43
7.3 Limitation on Indebtedness..................................................................... 44
7.4 Fundamental Changes............................................................................ 45
7.5 Dispositions................................................................................... 46
7.6 ERISA.......................................................................................... 47
7.7 Swap Agreements................................................................................ 47
7.8 Conduct of Business............................................................................ 47
7.9 Transactions with Affiliates................................................................... 47
7.10 Burdensome Agreements.......................................................................... 47
7.11 Use of Proceeds................................................................................ 48
7.12 Acquisitions................................................................................... 48
7.13 Investments, Loans, Advances, Guarantees and Acquisitions...................................... 49
7.14 Restricted Payments............................................................................ 50
SECTION 8. EVENTS OF DEFAULT..................................................................................... 51
SECTION 9. THE AGENTS............................................................................................ 54
9.1 Appointment.................................................................................... 54
9.2 Delegation of Duties........................................................................... 54
9.3 Exculpatory Provisions......................................................................... 55
9.4 Reliance by Agents............................................................................. 55
9.5 Notice of Default.............................................................................. 56
9.6 Non-Reliance on Agents and Other Lenders....................................................... 56
9.7 Indemnification................................................................................ 56
9.8 Agents in Their Individual Capacity............................................................ 57
9.9 Successor Administrative Agent................................................................. 57
SECTION 10. MISCELLANEOUS........................................................................................ 58
10.1 Amendments and Waivers......................................................................... 58
10.2 Notices........................................................................................ 58
10.3 No Waiver; Cumulative Remedies................................................................. 59
10.4 Survival of Representations and Warranties..................................................... 59
10.5 Payment of Expenses and Taxes.................................................................. 60
10.6 Successors and Assigns; Participations and Assignments......................................... 60
10.7 Adjustments; Set-off........................................................................... 65
10.8 Counterparts................................................................................... 65
10.9 Severability................................................................................... 65
10.10 Integration.................................................................................... 66
10.11 GOVERNING LAW.................................................................................. 66
10.12 Submission To Jurisdiction; Waivers............................................................ 66
10.13 Acknowledgements............................................................................... 67
10.14 Confidentiality................................................................................ 67
10.15 WAIVERS OF JURY TRIAL.......................................................................... 67
SECTION 11. GUARANTEE............................................................................................ 68
11.1 Guarantee...................................................................................... 68
11.2 Obligations Unconditional...................................................................... 69
11.3 Reinstatement.................................................................................. 70
11.4 Subrogation.................................................................................... 70
11.5 Remedies....................................................................................... 71
11.6 Instrument for the Payment of Money............................................................ 71
11.7 Continuing Guarantee........................................................................... 71
11.8 General Limitation on Guarantee Obligations.................................................... 71
SCHEDULES
Schedule 1.1 Names and Commitments of Lenders
Schedule 4.8 Taxes
Schedule 4.14 Subsidiaries
Schedule 7.7(c) Swap Agreements
EXHIBITS
Exhibit A Form of Guarantee Assumption Agreement
Exhibit B Form of Exemption Certificate
Exhibit C Form of Loan Note
Exhibit D Form of Opinion of Counsel to Borrower and Guarantors
Exhibit E Form of Compliance Certificate
Exhibit F Form of Assignment and Acceptance
CREDIT AGREEMENT, dated as of June 17, 2004, among (i) Henry Schein, Inc.,
a Delaware corporation (the "Borrower"), (ii) the several guarantors from time
to time parties hereto (the "Guarantors"), (iii) JPMorgan Chase Bank ("JPMCB"),
as administrative agent for the Lenders hereunder (in such capacity, the
"Administrative Agent"), (iv) Lehman Commercial Paper Inc., as syndication agent
(in such capacity, the "Syndication Agent"), (v) J.P. Morgan Securities Inc. and
Lehman Brothers Inc., as lead arrangers and joint bookrunners (collectively, in
such capacity, the "Joint Bookrunners"), and (vi) the several lenders and other
financial institutions or entities from time to time parties hereto (the
"Lenders").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Borrower has entered into Sale and Purchase Agreements,
effective as of January 6, 2004 and January 7, 2004, as the case may be (the
"Purchase Agreements"), to acquire all of the capital stock of demedis GmbH and
Euro Dental Holding GmbH (collectively, the "Target") for cash consideration of
E270,000,000 (the "Transaction");
WHEREAS, the Borrower has requested that the Lenders make available a
six-month term loan facility as described herein to finance the Transaction and
to pay related fees and expenses; and
WHEREAS, the Lenders have agreed to make such term loan facility available
upon the terms and subject to the conditions set forth herein;
NOW, THEREFORE, in consideration of the premises, and of the mutual
covenants and agreements herein contained and other good and valuable
consideration, receipt of which is hereby acknowledged, the parties hereto
hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms.
As used in this Agreement, the following terms shall have the
following meanings:
"ABR": for any day, a rate per annum (rounded upwards, if necessary, to
the next 1/100 of 1%) equal to the greater of (a) the Prime Rate in effect on
such day, and (b) the Federal Funds Effective Rate in effect on such day plus
- -1/4 of 1%. For purposes hereof: "Prime Rate" shall mean the rate of interest
per annum publicly announced from time to time by JPMCB as its prime rate in
effect at its principal office in New York City (the Prime Rate not being
intended to be the lowest rate of interest charged by JPMCB in connection with
extensions of credit to debtors); and "Federal Funds Effective Rate" shall mean,
for any day, 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 on the next succeeding Business Day by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day which
is a
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Business Day, the average of the quotations for the day of such transactions
received by the Administrative Agent from three federal funds brokers of
recognized standing selected by it. Any change in the ABR due to a change in the
Prime Rate or the Federal Funds Effective Rate shall be effective as of the
opening of business on the effective day of such change in the Prime Rate or the
Federal Funds Effective Rate, respectively.
"ABR Loans": Loans bearing interest at a rate per annum determined by
reference to the ABR.
"Acquisition": the acquisition of (a) a controlling equity or other
ownership interest in a Person (including the purchase of an option, warrant or
convertible or similar type security to acquire such a controlling interest at
the time it becomes exercisable by the holder thereof), whether by purchase of
such controlling equity or other ownership interest or upon exercise of an
option or warrant for, or conversion of securities into, such controlling equity
or other ownership interest, or (b) assets of a Person which constitute all or
substantially all of the assets of such Person or of a line or lines of business
conducted by such Person; provided that, for purposes of this Agreement, the
Transaction shall not be considered an "Acquisition".
"Adjusted LIBO Rate": with respect to each day during each Interest Period
pertaining to a LIBOR Loan, a rate per annum determined for such day in
accordance with the following formula (rounded upward to the nearest 1/100th of
1%):
LIBO Rate
1.00 - Eurocurrency Reserve Requirements
"Administrative Agent": JPMCB, as the Administrative Agent for the Lenders
under this Agreement and the other Loan Documents.
"Administrative Questionnaire": an administrative questionnaire in a form
supplied by the Administrative Agent.
"Affiliate": as to any Person, any other Person (other than a Subsidiary)
which, directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. For purposes of this definition, "control" of
a Person means the power, directly or indirectly, either to (a) vote 25% or more
of the securities having ordinary voting power for the election of directors of
(or persons performing similar functions for) such Person or (b) direct or cause
the direction of the management and policies of such Person, whether by contract
or otherwise.
"Agents": the collective reference to the Administrative Agent, the Joint
Bookrunners and the Syndication Agent.
"Agreement": this Credit Agreement, as amended, supplemented or otherwise
modified from time to time.
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"Applicable Margin": 0.925%.
"Approved Fund": as defined in subsection 10.6(b).
"Assignee": as defined in subsection 10.6(b).
"Assignment and Acceptance": as defined in subsection 10.6(b).
"Attorney Costs": all reasonable fees and disbursements of any law firm or
other external counsel.
"Borrower": as defined in the preamble to this Agreement.
"Business": as defined in subsection 4.10.
"Business Day": a day other than a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to close;
provided, that if such day relates to any LIBOR Loan, such term shall mean a day
other than a Saturday, Sunday or other day on which commercial banks in New York
City are authorized or required by law to close which is also a London Business
Day.
"Capital Lease Obligations": as 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 capital
leases on a balance sheet of such Person under GAAP and, for the purposes of
this Agreement, the amount of such obligations at any time shall be the
capitalized amount thereof at such time determined in accordance with GAAP.
"Capital Markets Transaction": the issuance or sale by the Borrower or any
of its Subsidiaries in a registered public offering, Rule 144A/Regulation S
transaction or private placement of Equity Interests (including equity-linked
securities) or notes, debentures, instruments or other debt securities with a
maturity in excess of one year; provided that, any such issuance or sale of
Equity Interests of the Borrower pursuant to any equity compensation plans or
arrangements shall not constitute a "Capital Markets Transaction."
"CLO": as defined in subsection 10.6(b).
"Closing Date": the date, on or before the earlier of (x) October 15, 2004
and (y) the date that is five Business Days after execution and delivery of this
Agreement by all of the parties hereto, on which date the conditions precedent
set forth in subsection 5.1 shall be satisfied.
"Code": the Internal Revenue Code of 1986, as amended from time to time.
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"Commitment": as to any Lender, its obligation to make a Loan to the
Borrower on the Closing Date in an amount equal to the amount set forth opposite
such Lender's name in Schedule 1.1 under the heading "Commitment" or, if
applicable, in the Assignment and Acceptance pursuant to which such Lender
becomes a party to this Agreement; collectively, as to all such Lenders, the
"Commitments".
"Commitment Percentage": as to any Lender, the percentage of the aggregate
Commitments then constituted by such Lender's Commitment (or, after the Loans
are made on the Closing Date, the percentage of the aggregate principal amount
of Loans then constituted by the principal amount of such Lender's Loans).
"Commonly Controlled Entity": an entity, whether or not incorporated,
which is under common control with the Borrower within the meaning of Section
4001 of ERISA or is part of a group which includes the Borrower and which is
treated as a single employer under Section 414 of the Code, except that for
purposes of Title IV of ERISA, a "Commonly Controlled Entity" means an entity,
whether or not incorporated, which is under common control with the Borrower
within the meaning of Section 4001 of ERISA.
"Consolidated EBITDA": for any period, Consolidated Operating Income plus,
without duplication, (a) Consolidated Interest Income, (b) depreciation, (c)
amortization and (d) the Designated Charges of the Borrower and its Subsidiaries
for such period, determined on a consolidated basis and as calculated consistent
with the manner disclosed by the Borrower in its Annual Report on Form 10-K for
the fiscal year ended December 27, 2003.
"Consolidated Gross Profit": for any period, net sales less cost of sales
of the Borrower and its Subsidiaries for such period, determined on a
consolidated basis in accordance with GAAP and as calculated consistent with the
manner disclosed by the Borrower in its Annual Report on Form 10-K for the
fiscal year ended December 27, 2003.
"Consolidated Interest Coverage Ratio": for any date of determination, the
ratio of (a) Consolidated EBITDA for the period of the four prior fiscal
quarters ending on (or most recently ended prior to) such date to (b)
Consolidated Interest Expense for such period.
"Consolidated Interest Expense": for any period, total interest expense
(including, without limitation, rent or interest expense pursuant to Capital
Lease Obligations that is treated as interest in accordance with GAAP) of the
Borrower and its Subsidiaries for such period, determined on a consolidated
basis in accordance with GAAP and as calculated consistent with the manner
disclosed by the Borrower in its Annual Report on Form 10-K for the fiscal year
ended December 27, 2003.
"Consolidated Interest Income": for any period, the interest income of the
Borrower and its Subsidiaries for such period, determined on a consolidated
basis in accordance with GAAP and as calculated consistent with the manner
disclosed by the Borrower in its Annual Report on Form 10-K for the fiscal year
ended December 27, 2003.
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"Consolidated Leverage Ratio": at any date of determination, the ratio of
(a) Consolidated Total Debt on such date to (b) Consolidated EBITDA for the
period of the four fiscal quarters ending on (or most recently ended prior to)
such date.
"Consolidated Operating Expenses": for any period, total expenses related
to salaries, employee benefits and general and administrative expenses of the
Borrower and its Subsidiaries determined on a consolidated basis in accordance
with GAAP and as calculated consistent with the manner disclosed by the Borrower
in its Annual Report on Form 10-K for the fiscal year ended December 27, 2003.
"Consolidated Operating Income": for any period, Consolidated Gross Profit
less Consolidated Operating Expenses of the Borrower and its Subsidiaries
determined on a consolidated basis in accordance with GAAP and as calculated
consistent with the manner disclosed by the Borrower in its Annual Report on
Form 10-K for the fiscal year ended December 27, 2003.
"Consolidated Total Assets": at any date of determination, the net book
value of all assets of the Borrower and its Subsidiaries determined on a
consolidated basis in accordance with GAAP and as calculated consistent with the
manner disclosed by the Borrower in its Annual Report on Form 10-K for the
fiscal year ended December 27, 2003.
"Consolidated Total Debt": at any date of determination, the aggregate
amount of all Indebtedness of the Borrower and its Subsidiaries determined on a
consolidated basis in accordance with GAAP and as calculated consistent with the
manner disclosed by the Borrower in its Annual Report on Form 10-K for the
fiscal year ended December 27, 2003.
"Continuing Directors": as to the Borrower, the directors of the Borrower
on the Closing Date and each other director of the Borrower whose nomination for
election to the Board of Directors of Borrower is recommended by a majority of
the then Continuing Directors.
"Contractual Obligation": as to any Person, any provision of any security
issued by such Person or of any agreement, instrument or other undertaking to
which such Person is a party or by which it or any of its property is bound.
"Default": any event or circumstance that, with the giving of any notice,
the passage of time, or both, would be an Event of Default.
"Designated Charges": for any period, to the extent deducted in computing
Consolidated Operating Income, the aggregate of total (a) non-cash,
non-recurring merger and integration costs, and (b) non-cash, non-recurring
restructuring costs, of the Borrower and its Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP and as calculated
consistent with the manner disclosed by the Borrower in its Annual Report on
Form 10-K for the fiscal year ended December 27, 2003.
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"Disposition" or "Dispose": the sale, transfer, license or other
disposition (including any sale and leaseback transaction) of any property by
any Person, including any sale, assignment, transfer or other disposal, with or
without recourse, of any notes or accounts receivable or any rights and claims
associated therewith.
"Disposition Value": (a) in the case of property that does not constitute
Subsidiary Stock, the book value thereof, valued at the time of such Disposition
in good faith by the Borrower, and (b) in the case of property that constitutes
Subsidiary Stock, an amount equal to that percentage of book value of the assets
of the Subsidiary that issued such stock as is equal to the percentage that the
book value of such Subsidiary Stock represents of the book value of all of the
outstanding Equity Interests of such Subsidiary (assuming, in making such
calculations, that all securities convertible into such Equity Interests are so
converted and giving full effect to all transactions that would occur or be
required in connection with such conversion) determined at the time of the
Disposition thereof, in good faith by the Borrower.
"Domestic Subsidiary": any Subsidiary other than a Foreign Subsidiary.
"Dollars" and "$": lawful currency of the United States of America.
"Environmental Laws": any and all applicable foreign, Federal, state,
local or municipal laws, rules, regulations, statutes, ordinances, codes,
decrees, or other enforceable requirements or orders of any Governmental
Authority or other Requirements of Law regulating, relating to or imposing
liability or standards of conduct concerning protection of human health or the
environment, as now or may at any time hereafter be in effect.
"Equity Interests": any and all shares of capital stock, partnership
interests, membership interests in a limited liability company, beneficial
interests in a trust or other equity ownership interests in a Person, and any
warrants, options or other rights entitling the holder thereof to purchase or
acquire any such equity interests.
"ERISA": the Employee Retirement Income Security Act of 1974, as amended
from time to time.
"Eurocurrency Reserve Requirements": for any day as applied to a Loan, the
aggregate (without duplication) of the rates (expressed as a decimal fraction)
of reserve requirements actually imposed on such day (including, without
limitation, basic, supplemental, marginal and emergency reserves) under any
regulations of the Board of Governors of the Federal Reserve System or other
Governmental Authority having jurisdiction with respect thereto dealing with
reserve requirements prescribed for eurocurrency funding (currently referred to
as "Eurocurrency Liabilities" in Regulation D of such Board) maintained by a
member bank of such System. The determination of Eurocurrency Reserve
Requirements by the Administrative Agent shall be conclusive in the absence of
manifest error.
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"Event of Default": any of the events specified in Section 8.
"Existing Credit Agreement": the $200,000,000 Credit Agreement, dated as
of May 2, 2002, among the Borrower, the guarantors and lenders party thereto and
JPMCB, as administrative agent thereunder, as amended, restated, refinanced,
supplemented or otherwise modified.
"Fair Market Value": at any time and with respect to any property, the
sale value of such property that would be realized in an arm's-length sale at
such time between an informed and willing buyer and an informed and willing
seller (neither being under a compulsion to buy or sell).
"Federal Funds Effective Rate": as defined in the definition of "ABR" in
this subsection 1.1.
"Fee Commencement Date": the Closing Date.
"Financing Lease": any lease of property, real or personal, the
obligations of the lessee in respect of which are Capital Lease Obligations on a
balance sheet of the lessee.
"Foreign Subsidiary": any Subsidiary incorporated or otherwise organized
in any jurisdiction outside the United States of America, its territories and
possessions.
"GAAP": generally accepted accounting principles in the United States of
America consistently applied with respect to those utilized in preparing the
audited financial statements referred to in subsection 4.1.
"Governmental Authority": any nation or government, any state or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.
"Guarantors": each of Roane Barker, Inc., Dentrix Dental Systems, Inc.,
HSI Service Corp., Micro Bio-Medics, Inc. and GIV Holdings, Inc., any
Subsidiaries or Affiliates that are guarantors under or with respect to any of
the Note Purchase Agreements or the Existing Credit Agreement from time to time
from and after the date hereof, and any Significant Subsidiary of the Borrower
from time to time formed, acquired, organized or existing from and after the
date hereof.
"Guarantee Obligation": as to any Person (the "guaranteeing person"), any
obligation of (a) the guaranteeing person or (b) another Person (including,
without limitation, any bank under any letter of credit) to induce the creation
of which the guaranteeing person has issued a reimbursement, counterindemnity or
similar obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the "primary obligations")
of any other unrelated third Person (the "primary obligor") in any manner,
whether directly or
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indirectly, including, without limitation, any obligation of the guaranteeing
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 (1) for the purchase or payment of any such primary
obligation or (2) 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, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation or (iv) otherwise
to assure or hold harmless the owner of any such primary obligation against loss
in respect thereof; provided, however, that the term Guarantee Obligation shall
not include endorsements of instruments for deposit or collection in the
ordinary course of business. The amount of any Guarantee Obligation shall be
deemed to be an amount equal to the stated or determinable amount of the related
primary obligation, or portion thereof, in respect of which such Guarantee
Obligation is made or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof as determined by the guaranteeing
Person in good faith.
"Indebtedness": of any Person at any date, 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, (c) all
obligations of such Person evidenced by notes, bonds, debentures or other
similar instruments, (d) all obligations of such person created or arising under
any conditional sale or other title retention agreement with respect to property
acquired by such Person, (e) all Capital Lease Obligations of such Person, (f)
all obligations of such Person, contingent or otherwise, as an account party or
applicant under or in respect of bankers' acceptances, letters of credit, surety
bonds or similar arrangements, (g) all indebtedness of such Person, determined
in accordance with GAAP, arising out of a Receivables Transaction, (h) all
Guarantee Obligations of such Person, (i) all obligations of such Person secured
by (or for which the holder of such obligation has an existing right, contingent
or otherwise, to be secured by) any Lien on property (including accounts and
contract rights) owned by such Person, whether or not such Person has assumed or
become liable for the payment of such obligation; provided, however, that in the
event that liability of such Person is non-recourse to such Person and is
recourse only to specified property owned by such Person, the amount of
Indebtedness attributed thereto shall not exceed the greater of the Fair Market
Value of such property or the net book value of such property, and (j) for the
purposes of subsection 8(d) only (except to the extent otherwise included
above), all obligations of such Person in respect of Swap Agreements; provided
that for the purposes of subsection 8(d), the "principal amount" of the
obligations of such Person in respect of any Swap Agreement at any time shall be
the maximum aggregate amount (giving effect to any netting agreements) that such
Person would be required to pay if such Swap Agreement were terminated at such
time. The Indebtedness of any Person shall include the Indebtedness of any other
entity (including any partnership in which such Person is a general partner) to
the extent such Person is actually 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 Indebtedness expressly provide that such Person is not
actually liable therefor.
"Insolvency": with respect to any Multiemployer Plan, the condition that
such Plan is insolvent within the meaning of Section 4245 of ERISA.
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"Insolvent": pertaining to a condition of Insolvency.
"Interest Payment Date": (a) as to any ABR Loan, the last day of each
March, June, September and December; (b) as to any LIBOR Loan having an Interest
Period of three months or less, the last day of such Interest Period; and (c) as
to any LIBOR Loan having an Interest Period longer than three months, each day
which is three months, or a whole multiple thereof, after the first day of such
Interest Period and the last day of such Interest Period.
"Interest Period": with respect to any LIBOR Loan:
(i) initially, the period commencing on the Closing Date or conversion
date, as the case may be, with respect to such LIBOR Loan and ending one, two,
three or six months thereafter, or, subject to approval by all of the Lenders,
seven days thereafter, as selected by the Borrower in its notice of conversion
given with respect thereto; and
(ii) thereafter, each period commencing on the last day of the next
preceding Interest Period applicable to such LIBOR Loan and ending one, two or
three months (or if applicable, seven days) thereafter, as selected by the
Borrower by irrevocable notice to the Administrative Agent not less than three
Business Days prior to the last day of the then current Interest Period with
respect thereto; provided that, all of the foregoing provisions relating to
Interest Periods are subject to the following:
(1) if any Interest Period would otherwise end on a day that is not a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless the result of such extension would be to carry such Interest
Period into another calendar month in which event such Interest Period shall end
on the immediately preceding Business Day;
(2) any Interest Period in respect of any Loan made by any Lender that
would otherwise extend beyond the Maturity Date applicable to such Lender shall
end on such Maturity Date; and
(3) any Interest Period that begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last
Business Day of a calendar month.
"IRS": the United States Internal Revenue Service and any successor
governmental agency performing a similar function.
"Joint Bookrunners": as defined in the preamble to this Agreement.
"JPMCB": as defined in the preamble to this Agreement.
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"Lender Affiliate": (a) any Affiliate of any Lender, (b) any Person that
is administered or managed by any Lender and that is engaged in making,
purchasing, holding or otherwise investing in commercial loans and similar
extensions of credit in the ordinary course of its business and (c) with respect
to any Lender which is a fund that invests in commercial loans and similar
extensions of credit, any other fund that invests in commercial loans and
similar extensions of credit and is managed or advised by the same investment
advisor as such Lender or by an Affiliate of such Lender or investment advisor.
"Lenders": as defined in the preamble hereto, and any other Person that
shall have become a party hereto pursuant to an Assignment and Acceptance, other
than any such Person that ceases to be a party hereto pursuant to an Assignment
and Assumption; provided, that unless the context otherwise requires, each
reference herein to the Lenders shall be deemed to include any Approved Fund.
"LIBOR Loans": Loans bearing interest at a rate based upon the Adjusted
LIBO Rate.
"LIBO Rate": with respect to each day during each Interest Period
pertaining to a LIBOR Loan, the rate per annum determined by the Administrative
Agent to be the offered rate for deposits in Dollars with a term comparable to
such Interest Period that appears on the applicable Telerate Page (or on any
successor or substitute page or service, or any successor to or substitute for
such page or service, providing rate quotations comparable to those currently
provided on such page or service, as reasonably determined by the Administrative
Agent from time to time for purposes of providing quotations of interest rates
applicable to deposits in Dollars in the London interbank market) at
approximately 11:00 A.M., London time, two Business Days prior to the beginning
of such Interest Period; provided, however, that if at any time for any reason
such offered rate shall not be available, "LIBO Rate" shall mean, with respect
to each day during each Interest Period pertaining to a LIBOR Loan, the rate per
annum reasonably determined by the Administrative Agent as the rate of interest
at which deposits in Dollars for delivery on the first day of such Interest
Period in same day funds in the amount of $5,000,000 and with a term equivalent
to such Interest Period would be offered by JPMCB's London branch or London
Affiliate to major banks in the London interbank market at their request at
approximately 11:00 a.m. (London time) two Business Days prior to the first day
of such Interest Period. The determination of the LIBO Rate by the
Administrative Agent shall be conclusive in the absence of manifest error.
"Lien": any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or any preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation, any
conditional sale or other title retention agreement and any Financing Lease
having substantially the same economic effect as any of the foregoing).
"Loan": as defined in subsection 2.1.
10
"Loan Documents": this Agreement, any Notes, the Fee Letter (as defined in
subsection 2.3), and all other instruments and documents heretofore or hereafter
executed or delivered to or in favor of any Lender or the Administrative Agent
in connection with the Loans made and transactions contemplated by this
Agreement.
"London Business Day": any day on which banks in London are open for
general banking business, including dealings in foreign currency and exchange.
"Majority Lenders": at any time, Lenders whose Commitment Percentages
aggregate more than 50%; provided that, in the event that there are no more than
two Lenders (for purposes of this definition, Affiliates of Lenders shall not be
considered additional Lenders), "Majority Lenders" shall mean Lenders whose
Commitment Percentages aggregate 100%.
"Material Adverse Effect": a material adverse effect on (i) the business,
assets, property or condition (financial or otherwise) of the Borrower and its
Subsidiaries, taken as a whole, or (ii) the validity or enforceability of any of
the Loan Documents or the rights or remedies of the Administrative Agent and the
Lenders thereunder, provided that events, developments or circumstances
("Changes") (including general economic or political conditions) generally
affecting the Borrower's industry which are not reasonably likely to have a
material adverse effect on (x) the business, assets, property or condition
(financial or otherwise) of the Borrower and its Subsidiaries, taken as a whole,
or (y) the validity or enforceability of any of the Loan Documents or the rights
or remedies of the Administrative Agent or Lenders thereunder, will not be
deemed Changes for purposes of determining whether a Material Adverse Effect
shall have occurred.
"Materials of Environmental Concern": any gasoline or petroleum (including
crude oil or any fraction thereof) or petroleum products or any hazardous or
toxic substances, materials or wastes, defined or regulated as such in or under
any Environmental Law, including, without limitation, friable asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.
"Maturity Date": the six-month anniversary of the Closing Date.
"Multiemployer Plan": a Plan which is a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"Net Cash Proceeds": (a) in connection with any Capital Markets
Transaction, the actual cash proceeds received from the related issuance or
sale, net of attorneys' fees, investment banking fees, accountants' fees,
underwriting discounts and commissions and other customary fees and expenses
actually incurred in connection therewith and (b) in connection with any
Disposition permitted by subsection 7.4(f), the proceeds thereof in the form of
cash (including any such proceeds received by way of deferred payment of
principal pursuant to a note or installment receivable or purchase price
adjustment receivable or otherwise, but only as and when received in the form of
cash) of such Disposition, net of attorneys' fees, investment banking fees,
accountants' fees, amounts required to be applied to the repayment of
Indebtedness
11
secured by a Lien expressly permitted hereunder on any asset that is the subject
of such Disposition, net of reasonable amounts, determined in accordance with
GAAP, required to be provided as a reserve against liabilities associated with
the assets which are the subject of such Disposition and other customary fees
and expenses actually incurred in connection therewith and net of taxes paid or
reasonably estimated to be payable as a result thereof (after taking into
account any available tax credits or deductions and any tax sharing
arrangements).
"Non-Excluded Taxes": as defined in subsection 3.10(a).
"Notes": as defined in subsection 3.13(d).
"Note Purchase Agreements": those certain Note Purchase Agreements dated
as of June 30, 1999 and September 25, 1998, respectively, between the Borrower
and the various note holders party thereto, as amended, restated, refinanced,
supplemented or otherwise modified.
"Obligations": collectively, the unpaid principal of and interest on the
Loans and all other obligations and liabilities of the Borrower under this
Agreement and the other Loan Documents to which it is a party (including,
without limitation, interest accruing at the then applicable rate provided in
this Agreement or any other applicable Loan Document after the maturity of the
Loans and interest accruing at the then applicable rate provided in this
Agreement or any other applicable Loan Document after the filing of any petition
in bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to the Borrower, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding), whether direct or
indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in connection with, this
Agreement, the Notes, the other Loan Documents, Swap Agreements entered into
with Lenders or any other document made, delivered or given in connection
therewith, in each case whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses or otherwise (including, without
limitation, all Attorney Costs of counsel to the Administrative Agent or to the
Lenders that are required to be paid by the Borrower pursuant to the terms of
this Agreement or any other Loan Document).
"Participant": as defined in subsection 10.6(c).
"PBGC": the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA and each successor thereto.
"Permitted Acquisitions": as defined in subsection 7.12.
"Permitted Investments":
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the
12
extent such obligations are backed by the full faith and credit of the United
States of America), in each case maturing within one year from the date of
acquisition thereof;
(b) certificates of deposit of any Lender, certificates of deposit,
eurodollar deposits, time deposits, overnight bank deposits, bankers acceptances
and repurchase agreements of any commercial bank which has capital and surplus
in excess of $200,000,000 and having maturities of one year or less from the
date of acquisition;
(c) corporate securities, including commercial paper, rated at least
A-2 by Standard & Poor's Ratings Services, a division of the McGraw-Hill
Companies ("S&P") and P-2 by Moody's Investors Service, Inc. ("Moody's") and
corporate debt instruments including medium term notes and floating rate notes
issued by foreign or domestic corporations which pay in Dollars rated at least A
by S&P or Moody's;
(d) short term tax exempt securities including municipal notes,
commercial paper, auction rate floaters and floating rate notes rated at least
A-1 by S&P or P-1 by Moody's;
(e) municipal notes rated at least SP-1 by S&P or MIG-2 by Moody's,
and bonds rated at AA by S&P or Moody's;
(f) auction rate preferred stock or bonds issued with a rate set
mechanism and a maximum term of 180 days rated at least AA by Moody's;
(g) securities with maturities of one year or less from the date of
acquisition issued or fully guaranteed by any state, commonwealth or territory
of the United States, by any political subdivision or taxing authority of any
such state, commonwealth or territory or by any foreign government, the
securities of which state, commonwealth, territory, political subdivision,
taxing authority or foreign government (as the case may be) are rated at least
AA by S&P or A by Moody's;
(h) securities with maturities of one year or less from the date of
acquisition fully backed by standby letters of credit issued by any Lender or
any commercial bank satisfying the requirements of clause (b) of this
definition; and
(i) money market accounts or funds which invest primarily in the
types of securities described in (a) through (h) above.
If both S&P and Moody's cease publishing ratings of investments of any of the
types described above, then equivalent ratings of a nationally recognized rating
agency will apply.
"Person": an individual, partnership, corporation, business trust, limited
liability company, joint stock company, trust, unincorporated association, joint
venture, Governmental Authority or other entity of whatever nature.
13
"Plan": at a particular time, any "employee pension benefit plan," as such
term is defined in Section 3(2) of ERISA and which is subject to Title IV of
ERISA and/or Section 412 of the Code, other than a Multiemployer Plan, and in
respect of which the Borrower or a Commonly Controlled Entity is (or, if such
plan were terminated at such time, would under Section 4069 of ERISA be deemed
to be) an "employer" as defined in Section 3(5) of ERISA or to which the
Borrower or a Commonly Controlled Entity contributes or has an obligation to
contribute.
"Prime Rate": as defined in the definition of "ABR" in this subsection
1.1.
"Properties": as defined in subsection 4.10(a).
"Purchase Agreements": as defined in the recitals to this Agreement.
"Receivables": any accounts receivable of any Person, including, without
limitation, any thereof constituting or evidenced by chattel paper, instruments
or general intangibles, and all proceeds thereof and rights (contractual and
other) and collateral related thereto.
"Receivables Subsidiary": any special purpose, bankruptcy-remote
Subsidiary that purchases Receivables generated by the Borrower or any of its
Subsidiaries.
"Receivables Transaction": any transaction or series of transactions
providing for the financing of Receivables of the Borrower or any of its
Subsidiaries, involving one or more sales, contributions or other conveyances by
the Borrower or any of its Subsidiaries of its/their Receivables to Receivables
Subsidiaries which finance the purchase thereof by means of the incurrence of
Indebtedness or otherwise. Notwithstanding anything contained in the foregoing
to the contrary: (a) no portion of the Indebtedness (contingent or otherwise)
with respect to any Receivables Transactions shall (i) be guaranteed by the
Borrower or any of its Subsidiaries, (ii) involve recourse to the Borrower or
any of its Subsidiaries (other than the relevant Receivables Subsidiary), or
(iii) require or involve any credit support or credit enhancement from the
Borrower or any of its Subsidiaries (other than the relevant Receivables
Subsidiary), provided that the Borrower and its Subsidiaries will be permitted
to agree to representations, warranties, covenants and indemnities that are
reasonably customary in accounts receivable securitization transactions of the
type contemplated (none of which representations, warranties, covenants or
indemnities will result in recourse to the Borrower or any of its Subsidiaries
(other than the relevant Receivables Subsidiary) beyond the limited recourse
that is reasonably customary in accounts receivable securitization transactions
of the type contemplated); and (b) the securitization facility and structure
relating to such Receivables Transactions shall be on market terms and
conditions customary for Receivables transactions of the type contemplated.
"Register": as defined in subsection 10.6(b).
"Related Parties": with respect to any specified Person, such Person's
Affiliates and the respective directors, officers, employees, and agents of such
Person or such Person's Affiliates.
14
"Reorganization": with respect to any Multiemployer Plan, the condition
that such plan is in reorganization within the meaning of Section 4241 of ERISA.
"Reportable Event": any of the events set forth in Section 4043(c) of
ERISA, other than those events as to which the thirty day notice period is
waived under PBGC Reg.Section 4043 or otherwise.
"Requirement of Law": as to any Person, the certificate of incorporation
and by-laws or other organizational or governing documents of such Person, and
any law, treaty, rule or regulation or determination of an arbitrator or a court
or other Governmental Authority, in each case applicable to or binding upon such
Person or any of its property or to which such Person or any of its property is
subject.
"Responsible Officer": with respect to any Person, the chief executive
officer and the president of such Person as well as, in the case of the
Borrower, the Vice President and General Counsel of the Borrower, and in the
case of any Guarantor, a duly elected Vice President of such Guarantor, or, with
respect to financial matters, the chief financial officer and the treasurer of
such Person.
"Restricted Payment": any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests or other
equity interest of the Borrower or any Subsidiary, or any payment (whether in
cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any such Equity Interests or other equity
interest or of any option, warrant or other right to acquire any such Equity
Interests or other equity interest.
"Significant Subsidiary":
(a) each domestic (i.e., incorporated or organized in the United
States or any state or territory thereof; hereinafter, "domestic") wholly-owned
Subsidiary or other entity formed or acquired by the Borrower or any direct or
indirect Subsidiary (whether existing at the date hereof, or formed or acquired
after the date hereof), if such Subsidiary or entity, after giving effect to the
formation/acquisition of the same, has total assets that exceed five percent of
the domestic "Consolidated Total Assets," valued as of the occurrence/closing of
such formation/acquisition or as of the last day of any fiscal year thereafter;
and
(b) each domestic Subsidiary or entity (whether existing at the date
hereof, or formed or acquired after the date hereof) in which the Borrower or
any Guarantor has, directly or indirectly, a 66.67% or greater but less than
100% ownership interest which becomes or is a Subsidiary if such Subsidiary or
entity, after giving effect to the formation/acquisition of the same, has total
assets that exceed five percent of the domestic "Consolidated Total Assets,"
valued as of the occurrence/closing of such formation/acquisition or as of the
last day of any fiscal year thereafter.
15
"Signing Date": the date on which the Lenders have signed this Agreement.
"Single Employer Plan": any Plan which is covered by Title IV of ERISA,
but which is not a Multiemployer Plan.
"Subsidiary": as to any Person ("parent"), a corporation, partnership or
other entity (a) the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, or (b) of
which shares of stock or other ownership interests having ordinary voting power
(other than stock or such other ownership interests having such power only by
reason of the happening of a contingency) to elect a majority of the board of
directors or other managers of such corporation, partnership or other entity are
at the time owned, or the management of which is otherwise controlled, directly
or indirectly through one or more intermediaries, or both, by such Person.
Unless otherwise qualified, all references to a "Subsidiary" or to
"Subsidiaries" in this Agreement shall refer to a direct or indirect Subsidiary
or Subsidiaries of the Borrower and shall include the Target and its
subsidiaries.
"Subsidiary Stock": with respect to any Person, the Equity Interests of
any Subsidiary of such Person.
"Swap Agreement": any agreement with respect to any swap, forward, future
or derivative transaction or option or similar agreement involving, or settled
by reference to, one or more rates, currencies, commodities, equity or debt
instruments or securities, or economic, financial or pricing indices or measures
of economic, financial or pricing risk or value or any similar transaction or
any combination of these transactions; provided that no phantom stock or similar
plan providing for payments only on account of services provided by current or
former directors, officers, employees or consultants of the Borrower or any of
its Subsidiaries shall be a Swap Agreement.
"Syndication Agent": as defined in the preamble to this Agreement.
"Target": as defined in the recitals to this Agreement.
"Transaction": as defined in the recitals to this Agreement.
"Transferee": as defined in subsection 10.6(e).
"Type": as to any Loan, its nature as an ABR Loan or a LIBOR Loan.
1.2 Other Definitional Provisions
(a) Unless otherwise specified therein, all terms defined in this
Agreement shall have the defined meanings when used in any Notes or any other
Loan Documents delivered pursuant hereto.
16
(b) As used herein or in any of the other Loan Documents, accounting
terms relating to the Borrower and its Subsidiaries not defined in subsection
1.1, and accounting terms partly defined in subsection 1.1, but only to the
extent not so defined, shall have the respective meanings given to them under
GAAP. If at any time any change in GAAP or in the manner in which the Borrower
shall be required or permitted to disclose its financial results in its filings
with the Securities and Exchange Commission (i.e., a change which is
inconsistent with the manner disclosed by the Borrower in its Annual Report on
Form 10-K for the fiscal year ended December 27, 2003) would affect the
computation of any financial ratio or requirement set forth in any Loan
Document, and either the Borrower or the Majority Lenders shall so request, the
Administrative Agent, the Lenders and the Borrower shall negotiate in good faith
to amend such ratio or requirement to preserve the original intent thereof in
light of such change (subject to the approval of the Majority Lenders); provided
that, until so amended, (i) such ratio or requirement shall continue to be
computed in accordance with GAAP and as calculated consistent with the manner
disclosed by the Borrower in its Annual Report on Form 10-K for the fiscal year
ended December 27, 2003 prior to such change therein and (ii) the Borrower shall
provide to the Administrative Agent and the Lenders financial statements and
other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change.
(c) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Section,
subsection, Schedule and Exhibit references are to this Agreement unless
otherwise specified. In the computation of periods of time from a specified date
to a later specified date, the word "from" means "from and including;" the words
"to" and "until" each mean "to but excluding;" and the word "through" means "to
and including." Each reference to "basis points" or "bps" shall be interpreted
in accordance with the convention that 100 bps = 1.0%.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
1.3 Rounding
Any financial ratios required to be maintained by the Borrower
pursuant to this Agreement shall be calculated by dividing the appropriate
component by the other component, carrying the result to one place more than the
number of places by which such ratio is expressed herein and rounding the result
up or down to the nearest number (with a rounding-up if there is no nearest
number).
17
1.4 References to Agreements and Laws
Unless otherwise expressly provided herein, (a) references to
agreements (including the Loan Documents) and other contractual instruments
shall be deemed to include all subsequent amendments, restatements, extensions,
supplements and other modifications thereto, but only to the extent that such
amendments, restatements, extensions, supplements and other modifications are
not prohibited by any Loan Document; and (b) references to any Law shall include
all statutory and regulatory provisions consolidating, amending, replacing,
supplementing or interpreting such Law.
SECTION 2. AMOUNT AND TERMS OF LOANS
2.1 Loans
(a) Subject to the terms and conditions hereof, each Lender
severally agrees to make a loan (individually, a "Loan" and collectively, the
"Loans") to the Borrower on the Closing Date, in an aggregate principal amount
equal to such Lender's Commitment.
(b) The Loans may from time to time be (i) LIBOR Loans, (ii) ABR
Loans or (iii) a combination thereof, as determined by the Borrower and notified
to the Administrative Agent in accordance with subsections 2.2 and 3.2. Each
Lender may at its option make any LIBOR Loan by causing any domestic or foreign
branch or Affiliate of such Lender to make such Loan; provided that any exercise
of such option shall not affect the obligation of the Borrower to repay such
Loan in accordance with the terms of this Agreement.
(c) The failure of any Lender to make the Loan to be made by it
shall not relieve any other Lender of its obligation, if any, hereunder to make
its Loan on the Closing Date, but no Lender shall be responsible for the failure
of any other Lender to make the Loan to be made by such other Lender on the
Closing Date.
2.2 Procedure for Borrowing
The Borrower shall give the Administrative Agent irrevocable notice
(which notice must be received by the Administrative Agent prior to 10:00 A.M.,
New York City time, three Business Days prior to the anticipated Closing Date,
in the case of LIBOR Loans and on the Closing Date, in the case of ABR Loans)
requesting that the Lenders make the Loans on the Closing Date. Any such notice
shall specify (x) whether the borrowing is to be comprised of LIBOR Loans, ABR
Loans or a combination thereof and (y) if the borrowing is to be entirely or
partly comprised of LIBOR Loans, the amount of such LIBOR Loan and the length of
the initial Interest Period therefor. Upon receipt of such notice the
Administrative Agent shall promptly notify each Lender thereof. Prior to 11:00
A.M., New York City time in the case of LIBOR Loans, and prior to 12:00 Noon,
New York City time in the case of ABR Loans, on the Closing Date, each Lender
shall make available to the Administrative Agent at its office specified in
subsection 10.2 an amount in immediately available funds in Dollars equal to the
Loan to be
18
made by such Lender. The Administrative Agent shall credit the account of the
Borrower on the books of such office of the Administrative Agent with the
aggregate of the amounts made available to the Administrative Agent by the
Lenders and in like funds as received by the Administrative Agent.
2.3 Fees
The Borrower shall pay an arrangement fee to the Joint Bookrunners
for their account, in the amount and at the time specified in the letter
agreement, dated January 8, 2004 (the "Fee Letter"), between the Borrower, the
Joint Bookrunners, JPMCB and Lehman Commercial Paper Inc. Such fee shall be
nonrefundable for any reason whatsoever.
2.4 Termination or Reduction of Commitments
(a) The Borrower shall have the right, upon not less than four
Business Days' notice to the Administrative Agent, to terminate the Commitments
or to reduce the amount of the Commitments; provided that no such termination or
reduction shall be permitted if, after giving effect thereto, either (a) the
Commitments would not be greater than or equal to zero or (b) the Commitment of
any Lender would not be greater than or equal to zero. Any such reduction shall
be in an amount equal to $5,000,000 or a whole multiple of $1,000,000 in excess
thereof, and shall reduce permanently the Commitments. The Administrative Agent
shall give each Lender prompt notice of any notice received from the Borrower
pursuant to this subsection 2.4.
(b) If the Borrower or any of its Subsidiaries consummates any
Capital Markets Transaction on or prior to the Closing Date which results in the
receipt by the Borrower or any of its Subsidiaries of Net Cash Proceeds with
respect thereto, the Commitments shall be reduced, on the same Business Day on
which such Net Cash Proceeds are received, in an amount equal to the amount of
such Net Cash Proceeds.
(c) If the Borrower or any of its Subsidiaries consummates any
Disposition permitted by subsection 7.4(f) on or prior to the Closing Date which
requires a reduction of the Commitments pursuant to such subsection, the
Commitments shall be reduced, on the same Business Day on which the relevant Net
Cash Proceeds are received, in an amount equal to the amount of such Net Cash
Proceeds.
(d) Any Commitments not drawn on the date the Transaction is
consummated shall terminate.
2.5 Repayment of Loans
The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of each Lender the then unpaid principal
amount of each Loan on the Maturity Date. The Borrower hereby further agrees to
pay to the Administrative Agent for the account of each Lender interest on the
unpaid principal amount of the Loans outstanding until payment in full thereof
at the rates per annum, and on the dates, set forth in subsection 3.4.
19
SECTION 3. CERTAIN PROVISIONS
APPLICABLE TO THE LOANS
3.1 Optional and Mandatory Prepayments
(a) If the Borrower or any of its Subsidiaries consummates any
Capital Markets Transaction subsequent to the Closing Date which results in the
receipt by the Borrower or any of its Subsidiaries of Net Cash Proceeds with
respect thereto, the Borrower shall prepay, on the Business Day next succeeding
the day on which such Net Cash Proceeds are received, any outstanding Loans,
with the amount of such prepayment being equal to the amount of such Net Cash
Proceeds.
(b) If the Borrower or any of its Subsidiaries consummates any any
Disposition permitted by subsection 7.4(f) subsequent to the Closing Date which
requires that the Loans be prepaid pursuant to such subsection, the Borrower
shall prepay, on the Business Day next succeeding the day on which the relevant
Net Cash Proceeds are received, any outstanding Loans, with the amount of such
prepayment being equal to the amount of such Net Cash Proceeds.
(c) The Borrower may at any time and from time to time prepay
outstanding Loans, in whole or in part, without premium or penalty (other than
any amounts payable pursuant to subsection 3.11 if such prepayment is of LIBOR
Loans and is made on a day other than the last day of the Interest Period with
respect thereto), upon at least four Business Days' irrevocable notice to the
Administrative Agent specifying the date and amount of prepayment and whether
the prepayment is of LIBOR Loans, ABR Loans, a combination thereof, if of a
combination thereof, the amount allocable to each. Upon receipt of any such
notice the Administrative Agent shall promptly notify each Lender thereof. If
any such notice is given, the amount specified in such notice shall be due and
payable by the Borrower on the date specified therein. Partial prepayments of
Loans shall be in an aggregate principal amount of at least $5,000,000 or an
integral multiple of $1,000,000 in excess thereof.
(d) Amounts to be applied to prepayments of Loans pursuant to
subsections 3.1(a) and (b) shall be applied, without duplication, first, to
prepay ABR Loans, if applicable, and, second, to prepay LIBOR Loans. Each
prepayment of the Loans under this subsection 3.1 shall be accompanied by
payment of accrued interest to the date of such prepayment on the amount
prepaid.
20
3.2 Conversion and Continuation Options
(a) The Borrower may elect from time to time to convert LIBOR Loans
to ABR Loans by giving the Administrative Agent at least two Business Days'
prior irrevocable notice of such election. The Borrower may elect from time to
time to convert ABR Loans to LIBOR Loans by giving the Administrative Agent at
least three Business Days' prior irrevocable notice of such election. Any such
notice of conversion to LIBOR Loans shall specify the length of the initial
Interest Period therefor. Upon receipt of any such notice the Administrative
Agent shall promptly notify each Lender thereof. All or any part of outstanding
LIBOR Loans and ABR Loans may be converted as provided herein, provided that (i)
no Loan may be converted into a LIBOR Loan when any Event of Default has
occurred and is continuing and the Administrative Agent has or the Majority
Lenders have determined that such a conversion is not appropriate and (ii) no
Loan may be converted into a LIBOR Loan after the date that is one month prior
to the Maturity Date.
(b) Any LIBOR Loans may be continued as such upon the expiration of
the then current Interest Period with respect thereto by the Borrower giving
notice to the Administrative Agent, in accordance with the applicable provisions
of the term "Interest Period" set forth in subsection 1.1, of the length of the
next Interest Period to be applicable to such Loans, provided that no LIBOR Loan
may, except as provided in the following proviso, be continued as such (A) when
any Event of Default has occurred and is continuing and the Administrative Agent
has or the Majority Lenders have determined that such a continuation is not
appropriate or (B) after the date that is one month prior to the Maturity Date,
and provided, further, that if the Borrower shall fail to give such notice or if
such continuation is not permitted, all Loans shall be automatically converted
to ABR Loans on the last day of such then expiring Interest Period. Upon receipt
of any notice pursuant to this subsection 3.2(b), the Administrative Agent shall
promptly notify each Lender thereof.
3.3 Maximum Number of Tranches
Notwithstanding anything contained herein to the contrary, after
giving effect to the transactions contemplated hereby, unless consented to by
the Administrative Agent in its sole discretion, there shall not be more than
twelve different Interest Periods in effect in respect of all Loans at any one
time outstanding.
3.4 Interest Rates and Payment Dates
(a) Each LIBOR Loan shall bear interest for each day during each
Interest Period with respect thereto at a rate per annum equal to the Adjusted
LIBO Rate determined for such Interest Period plus the Applicable Margin.
(b) Each ABR Loan shall bear interest at a rate per annum equal to
the ABR.
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(c) If all or a portion of (i) any principal of any Loan, (ii) any
interest payable thereon, or (iiii) any other amount payable hereunder shall not
be paid when due (whether at the stated maturity, by acceleration or otherwise),
the principal of the Loans and any such overdue interest or other amount shall
bear interest at a rate per annum which is (x) in the case of principal, the
rate that would otherwise be applicable thereto pursuant to the foregoing
provisions of this subsection plus 2% or (y) in the case of any such overdue
interest or other amount, the rate described in paragraph (b) of this subsection
plus 2%, in each case from the date of such non-payment until such overdue
principal, interest or other amount is paid in full (as well after as before
judgment).
(d) Interest pursuant to this subsection shall be payable in arrears
on each Interest Payment Date, provided that interest accruing pursuant to
paragraph (c) of this subsection shall be payable from time to time on demand.
3.5 Computation of Interest and Fees
(a) Whenever interest is calculated on the basis of the Prime Rate,
interest shall be calculated on the basis of a 365 (or 366, as the case may be)
day year for the actual days elapsed; and, otherwise, interest and fees shall be
calculated on the basis of a 360-day year for the actual days elapsed. The
Administrative Agent shall as soon as practicable notify the Borrower and the
Lenders of each determination of an Adjusted LIBO Rate. Any change in the
interest rate on a Loan resulting from a change in the ABR or the Eurocurrency
Reserve Requirements, shall become effective as of the opening of business on
the day on which such change becomes effective. The Administrative Agent shall
as soon as practicable notify the Borrower and the Lenders of the effective date
and the amount of each such change in interest rate.
(b) Each determination of an interest rate by the Administrative
Agent pursuant to any provision of this Agreement shall be conclusive and
binding on the Borrower and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrower, deliver to the
Borrower a statement showing the quotations used by the Administrative Agent in
determining any interest rate pursuant to subsection 3.4(a) or (b).
3.6 Inability to Determine Interest Rate
If prior to the first day of any Interest Period:
(a) the Administrative Agent shall have determined in good faith
(which determination shall be conclusive and binding upon the Borrower) that, by
reason of circumstances affecting the relevant market, adequate and reasonable
means do not exist for ascertaining the Adjusted LIBO Rate for such Interest
Period, or
(b) the Administrative Agent shall have received notice from the
Majority Lenders that the Adjusted LIBO Rate determined or to be determined for
such Interest Period
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will not adequately and fairly reflect the cost to such Lenders (as given in
good faith and conclusively certified by such Lenders) of making or maintaining
their affected Loans during such Interest Period, the Administrative Agent shall
give telecopy or telephonic notice thereof to the Borrower and the Lenders as
soon as practicable thereafter. If such notice is given, (w) any LIBOR Loans
requested to be made on the first day of such Interest Period shall be made as
ABR Loans, provided, that, notwithstanding the provisions of subsection 2.2, the
Borrower may cancel the request for such LIBOR Loan by written notice to the
Administrative Agent one Business Day prior to the first day of such Interest
Period and the Borrower shall not be subject to any liability pursuant to
subsection 3.11 with respect to such cancelled request, (x) any Loans that were
to have been converted on the first day of such Interest Period to LIBOR Loans
shall be continued as ABR Loans, and (y) any outstanding LIBOR Loans shall be
converted, on the first day of such Interest Period, to ABR Loans. Until such
notice has been withdrawn by the Administrative Agent, no further LIBOR Loans
shall be made or continued as such, nor shall the Borrower have the right to
convert ABR Loans to LIBOR Loans.
3.7 Pro Rata Treatment and Payments
(a) Except to the extent provided elsewhere in this Agreement to the
contrary, each payment of principal or interest in respect of the Loans shall be
made pro rata according to the amounts then due and owing to the respective
Lenders.
(b) Each payment (including each prepayment) by the Borrower on
account of principal of and interest on the Loans shall be made pro rata
according to the respective outstanding principal amounts of the Loans then due
and owing to the Lenders. All payments (including prepayments) to be made by the
Borrower hereunder, whether on account of principal, interest, fees or
otherwise, shall be made without set off or counterclaim and shall be made prior
to 12:00 Noon, New York City time, on the due date thereof to the Administrative
Agent, for the account of the Lenders, at the Administrative Agent's office
specified in subsection 10.2, in Dollars and in immediately available funds. The
Administrative Agent shall distribute such payments to the Lenders promptly upon
receipt. If any payment hereunder (other than payments on the LIBOR Loans)
becomes due and payable on a day other than a Business Day, such payment shall
be extended to the next succeeding Business Day, and, with respect to payments
of principal, interest thereon shall be payable at the then applicable rate
during such extension. If any payment on a LIBOR Loan becomes due and payable on
a day other than a Business Day, the maturity of such payment shall be extended
to the next succeeding Business Day (and, with respect to payments of principal,
interest thereon shall be payable at the then applicable rate during such
extension) unless the result of such extension would be to extend such payment
into another calendar month, in which event such payment shall be made on the
immediately preceding Business Day.
(c) Unless the Administrative Agent shall have been notified in
writing by any Lender prior to the Closing Date that such Lender will not make
the amount that would constitute its Commitment (or any portion thereof)
available to the Administrative Agent, the Administrative Agent may assume that
such Lender is making such amount available to the
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Administrative Agent, and the Administrative Agent may, in reliance upon such
assumption, make available to the Borrower a corresponding amount. If such
amount is not made available to the Administrative Agent by the required time on
the Closing Date, such Lender shall pay to the Administrative Agent, on demand,
such amount with interest thereon at a rate equal to the daily average Federal
Funds Effective Rate for the period until such Lender makes such amount
immediately available to the Administrative Agent. A certificate of the
Administrative Agent submitted to any Lender with respect to any amounts owing
under this subsection shall be conclusive in the absence of manifest error. If
such Lender's Commitment (or any portion thereof) is not made available to the
Administrative Agent by such Lender within three Business Days of the Closing
Date, the Administrative Agent shall also be entitled to recover such amount
with interest thereon equal to the rate per annum applicable to ABR Loans
hereunder, on demand, from the Borrower (without prejudice to any rights
Borrower may have against any such Lender).
3.8 Illegality
Notwithstanding any other provision herein, if any Lender determines that
the adoption of or any change in any Requirement of Law or any change in the
interpretation or application thereof after the date hereof shall make it
unlawful for such Lender to maintain LIBOR Loans as contemplated by this
Agreement, then, on notice thereof by such Lender to the Borrower through the
Administrative Agent, (a) the commitment of such Lender hereunder to convert ABR
Loans to LIBOR Loans shall forthwith be suspended until such Lender notifies the
Administrative Agent and the Borrower that the circumstances giving rise to such
determination no longer exists, (b) such Lender's Loans then outstanding as
LIBOR Loans, if any, shall be converted automatically to ABR Loans on the
respective last days of the then current Interest Periods with respect to such
Loans or within such earlier period as required by law. If any such conversion
or prepayment of a LIBOR Loan occurs on a day which is not the last day of the
then current Interest Period with respect thereto, the Borrower shall pay to
such Lender such amounts, if any, as may be required pursuant to subsection
3.11.
3.9 Requirements of Law
(a) If the adoption of or any change in any Requirement of Law or
any change in the interpretation or application thereof or compliance by any
Lender with any request or directive (whether or not having the force of law)
from any central bank or other Governmental Authority made subsequent to the
date hereof:
(i) shall subject any Lender to any tax of any kind whatsoever
with respect to this Agreement, any Note or any LIBOR Loan made by
it, or change the basis of taxation of payments to such Lender in
respect thereof (except for Non-Excluded Taxes covered by subsection
3.10 and changes in the rate of tax on the overall net income or
franchise taxes (in lieu of net income taxes) of such Lender imposed
by the jurisdiction where such Lender's principal or lending office
is located);
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(ii) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against
assets held by, deposits or other liabilities in or for the account
of, advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender which is not
otherwise included in the determination of the Adjusted LIBO Rate;
or
(iii) shall impose on such Lender any other condition;
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining LIBOR Loans or to reduce any amount receivable
hereunder in respect thereof, then, in any such case, the Borrower shall
promptly pay such Lender such additional amount or amounts as will compensate
such Lender for such increased cost or reduced amount receivable.
(b) If any Lender shall have determined that after the date hereof
the adoption of or any change in any Requirement of Law regarding capital
adequacy or any change in the interpretation or application thereof or
compliance by such Lender or any corporation controlling such Lender with any
request or directive regarding capital adequacy (whether or not having the force
of law) from any Governmental Authority made subsequent to the date hereof shall
have the effect of reducing the rate of return on such Lender's or such
corporation's capital as a consequence of its obligations hereunder to a level
below that which such Lender or such corporation could have achieved but for
such adoption, change or compliance (taking into consideration such Lender's or
such corporation's policies with respect to capital adequacy) by an amount
deemed by such Lender to be material, then from time to time, the Borrower shall
promptly pay to such Lender such additional amount or amounts as will compensate
such Lender or such corporation for such reduction.
(c) If any Lender becomes entitled to claim any additional amounts
pursuant to this subsection, it shall notify the Borrower (with a copy to the
Administrative Agent) of the event by reason of which it has become so entitled;
provided that if such Lender fails to notify the Borrower that such Lender
intends to claim any such reimbursement or compensation within 120 days after
such Lender has knowledge of its claim therefor, the Borrower shall not be
obligated to compensate such Lender for the amount of such Lender's claim
accruing prior to the date which is 120 days before the date on which such
Lender first notifies the Borrower that it intends to make such claim; it being
understood that the calculation of the actual amounts may not be practicable
within such period and such Lender may provide such calculation as soon as
reasonably practicable thereafter without affecting or limiting the Borrower's
payment obligations hereunder. A certificate as to any additional amounts
payable pursuant to this subsection submitted by such Lender to the Borrower
(with a copy to the Administrative Agent) shall be conclusive in the absence of
manifest error. The agreements in this subsection shall survive the termination
of this Agreement and each other Loan Document and the payment of the Loans and
all other amounts payable hereunder and thereunder.
3.10 Taxes
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(a) All payments made by the Borrower under any Loan Document shall
be made free and clear of, and without deduction or withholding for or on
account of, any present or future income, stamp or other taxes, levies, imposts,
duties, charges, fees, deductions or withholdings, now or hereafter imposed,
levied, collected, withheld or assessed by any Governmental Authority, excluding
net income taxes and franchise taxes (imposed in lieu of net income taxes)
imposed on the Administrative Agent or any Lender as a result of a present or
former connection between the Administrative Agent or such Lender and the
jurisdiction of the Governmental Authority imposing such tax or any political
subdivision or taxing authority thereof or therein (other than any such
connection arising solely from the Administrative Agent or such Lender having
executed, delivered or performed its obligations or received a payment under, or
enforced, any Loan Document). If any such non-excluded taxes, levies, imposts,
duties, charges, fees, deductions or withholdings ("Non-Excluded Taxes") are
required to be withheld from any amounts payable to the Administrative Agent or
any Lender hereunder or under any other Loan Document, the amounts so payable to
the Administrative Agent or such Lender shall be increased to the extent
necessary to yield to the Administrative Agent or such Lender (after payment of
all Non-Excluded Taxes) interest or any such other amounts payable hereunder at
the rates or in the amounts specified in such Loan Document, provided, however,
that the Borrower shall not be required to increase any such amounts payable to
any Lender that is not organized under the laws of the United States of America
or a state thereof if such Lender fails to comply with the requirements of
paragraph (b) of this subsection. Whenever any Non-Excluded Taxes are payable by
the Borrower, as promptly as possible thereafter the Borrower shall send to the
Administrative Agent for its own account or for the account of such Lender, as
the case may be, a certified copy of an original official receipt received by
the Borrower showing payment thereof. If the Borrower fails to pay any
Non-Excluded Taxes when due to the appropriate taxing authority or fails to
remit to the Administrative Agent the required receipts or other required
documentary evidence, the Borrower shall indemnify the Administrative Agent and
the Lenders for any incremental taxes, interest or penalties that may become
payable by the Administrative Agent or any Lender as a result of any such
failure. The agreements in this subsection shall survive the termination of this
Agreement and each other Loan Document and the payment of the Loans and all
other amounts payable hereunder and thereunder.
(b) Each Lender (or Transferee) that is not a citizen or resident of
the United States of America, a corporation, partnership or other entity created
or organized in or under the laws of the United States of America (or any
jurisdiction thereof), or any estate or trust that is subject to federal income
taxation regardless of the source of its income (a "Non-U.S. Lender") shall
deliver to the Borrower and the Administrative Agent (or, in the case of a
Participant, to the Lender from which the related participation shall have been
purchased) two copies of either U.S. Internal Revenue Service Form W-8BEN or
Form W-8ECI, or, in the case of a Non-U.S. Lender claiming exemption from U.S.
federal withholding tax under Section 871(h) or 881(c) of the Code with respect
to payments of "portfolio interest" a statement substantially in the form of
Exhibit B and a Form W-8BEN, or any subsequent versions thereof or successors
thereto properly completed and duly executed by such Non-U.S. Lender claiming
complete exemption from, or a reduced rate of, U.S. federal withholding tax on
all payments by the Borrower under this Agreement and the other Loan Documents.
Such forms shall be delivered by each Non-U.S.
26
Lender on or before the date it becomes a party to any Loan Document (or, in the
case of any Participant, on or before the date such Participant purchases the
related participation). In addition, each Non-U.S. Lender shall deliver such
forms promptly upon the obsolescence or invalidity of any form previously
delivered by such Non-U.S. Lender. Each Non-U.S. Lender shall promptly notify
the Borrower at any time it determines that it is no longer in a position to
provide any previously delivered certificate to the Borrower (or any other form
of certification adopted by the U.S. taxing authorities for such purpose).
Notwithstanding any other provision of this paragraph, a Non-U.S. Lender shall
not be required to deliver any form pursuant to this paragraph that such
Non-U.S. Lender is not legally able to deliver.
(c) A Lender that is entitled to an exemption from or reduction of
non-U.S. withholding tax under the law of the jurisdiction in which the Borrower
is located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law or
reasonably requested by the Borrower, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to be
made without withholding or at a reduced rate, provided that such Lender is
legally entitled to complete, execute and deliver such documentation and in such
Lender's reasonable judgment such completion, execution or submission would not
materially prejudice the legal position of such Lender.
3.11 Break Funding Payments
The Borrower agrees to indemnify each Lender and to hold each Lender
harmless from any loss or expense which such Lender may sustain or incur as a
consequence of (a) default by the Borrower in making a conversion into or
continuation of LIBOR Loans, after the Borrower has given a notice requesting
the same in accordance with the provisions of this Agreement, (b) default by the
Borrower in making any prepayment after the Borrower has given a notice thereof
in accordance with the provisions of this Agreement or any other Loan Document,
or (c) the making of a prepayment of LIBOR Loans, or the conversion of LIBOR
Loans to ABR Loans, on a day which is not the last day of an Interest Period
with respect thereto or (d) any assignment as a result of a request by the
Borrower pursuant to subsection 3.12 of any LIBOR Loan. Such indemnification may
include an amount equal to the excess, if any, of (i) the amount of interest
which would have accrued on the amount so prepaid or converted, or not so
borrowed, prepaid, converted or continued, for the period from the date of such
prepayment or conversion or of such failure to borrow, prepay, convert or
continue to the last day of such Interest Period (or, in the case of a failure
to borrow, convert or continue, the Interest Period that would have commenced on
the date of such failure) at the applicable rate of interest for such Loans
provided for herein over (ii) the amount of interest (as reasonably determined
by such Lender) which would have accrued to such Lender on such amount by
placing such amount on deposit for a comparable period with leading Lenders in
the interbank eurodollar market. This covenant shall survive the termination of
this Agreement and each other Loan Document and the payment of the Loans and all
other amounts payable hereunder and thereunder. A certificate as to any
additional amounts payable pursuant to this subsection submitted by such Lender
to the
27
Borrower (with a copy to the Administrative Agent) shall be conclusive in the
absence of manifest error.
3.12 Change of Lending Office; Removal of Lender
Each Lender agrees that if it makes any demand for payment under
subsection 3.9 or 3.10(a), or if any adoption or change of the type described in
subsection 3.8 shall occur with respect to it, (i) it will use reasonable
efforts (consistent with its internal policy and legal and regulatory
restrictions and so long as such efforts would not be disadvantageous to it, as
determined in its sole discretion) to designate a different lending office if
the making of such a designation would reduce or obviate the need for the
Borrower to make payments under subsection 3.9 or 3.10(a), or would eliminate or
reduce the effect of any adoption or change described in subsection 3.8 or (ii)
it will, upon at least five Business Days' notice from the Borrower to such
Lender and the Administrative Agent, assign, pursuant to and in accordance with
the provisions of subsection 10.6, to one or more Assignees designated by the
Borrower all, but not less than all, of such Lender's rights and obligations
hereunder, without recourse to or warranty by, or expense to, such Lender, for a
purchase price equal to the outstanding principal amount of each Loan then owing
to such Lender plus any accrued but unpaid interest thereon and, in addition,
all additional costs and reimbursements, expense reimbursements and indemnities,
if any, owing in respect of such Lender's Commitment hereunder at such time
(including any amount that would be payable under subsection 3.11 if such
assignment were, instead, a prepayment in full of all amounts owing to such
Lender and also including all amounts then payable to such Lender pursuant to
subsections 3.9 and/or 3.10) shall be paid to such Lender.
3.13 Evidence of Debt
(a) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing indebtedness of the Borrower to such Lender
resulting from each Loan of such Lender from time to time, including the amounts
of principal and interest payable and paid to such Lender from time to time
under this Agreement.
(b) The Administrative Agent shall maintain the Register pursuant to
subsection 10.6(b), and a subaccount therein for each Lender, in which shall be
recorded (i) the Type and, in the case of LIBOR Loans, the Interest Period
applicable to each Loan, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder
and (iii) both the amount of any sum received by the Administrative Agent
hereunder from the Borrower and each Lender's share thereof.
(c) The entries made in the Register and the accounts of each Lender
maintained pursuant to subsection 3.13(a) shall, to the extent permitted by
applicable law, be prima facie evidence of the existence and amounts of the
obligations of the Borrower therein recorded; provided, however, that the
failure of any Lender or the Administrative Agent to maintain the Register or
any such account, or any error therein, shall not in any manner affect the
28
obligation of the Borrower to repay (with applicable interest) the Loans made to
such Borrower by such Lender in accordance with the terms of this Agreement.
(d) The Borrower agrees that, upon the request to the Administrative
Agent by any Lender, the Borrower will execute and deliver to such Lender a
promissory note of the Borrower evidencing the Loans of such Lender,
substantially in the form of Exhibit C with appropriate insertions as to date
and principal amount (a "Note").
SECTION 4. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into this
Agreement and to make the Loans, the Borrower hereby represents and warrants to
the Administrative Agent and each Lender that:
4.1 Financial Condition
(a) The consolidated and consolidating balance sheets of the
Borrower and its consolidated Subsidiaries as at December 27, 2003 and December
28, 2002, respectively, and the related consolidated and consolidating
statements of operations and of cash flows for the fiscal years ended on such
dates, reported on by BDO Seidman, LLP, copies of which have heretofore been
furnished to each Lender, present fairly, in all material respects, the
consolidated and consolidating financial condition of the Borrower and its
consolidated Subsidiaries as at such dates, and the consolidated and
consolidating results of their operations and of their cash flows for the fiscal
years then ended. All such financial statements, including the related schedules
and notes thereto, were, as of the date prepared, prepared in accordance with
GAAP applied consistently throughout the periods involved (except as otherwise
expressly noted therein, and show all material Indebtedness and other
liabilities, direct or contingent, of the Borrower and each of its Subsidiaries
as of the dates thereof, including liabilities for taxes, material commitments
and Indebtedness. Neither the Borrower nor any of its consolidated Subsidiaries
had, at the date of the most recent balance sheets referred to above, any
material Guarantee Obligation, material contingent liability or material
liability for taxes, or any material long-term lease or material forward or
long-term commitment, including, without limitation, any interest rate or
foreign currency swap or exchange transaction, which is not reflected in the
foregoing statements or in the notes thereto.
(b) As of the date hereof, there are no material liabilities or
obligations of the Borrower or any of its Subsidiaries, whether direct or
indirect, absolute or contingent, or matured or unmatured, other than (i) as
disclosed or provided for in the financial statements and notes thereto which
are referred to above, or (ii) which are disclosed elsewhere in this Agreement
or in the Schedules hereto, or (iii) arising in the ordinary course of business
since December 27, 2003 or (iv) created by this Agreement. As of the date
hereof, the written information, exhibits and reports furnished by the Borrower
to the Lenders in connection with the negotiation of this Agreement, taken as a
whole, are complete and correct in all material respects.
29
4.2 No Change
Since December 27, 2003, there has been no development or event
which has had or could reasonably be expected to have a Material Adverse Effect.
4.3 Corporate Existence; Compliance with Law
Each of the Borrower and its Subsidiaries (a) is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization, (b) has the corporate power and authority, and the legal right, to
own and operate its property, to lease the property it operates as lessee and to
conduct the business in which it is currently engaged, (c) is duly qualified as
a foreign corporation and in good standing under the laws of each jurisdiction
where its ownership, lease or operation of property or the conduct of its
business requires such qualification and (d) is in compliance with all
Requirements of Law (provided that no representation or warranty is made in this
subsection 4.3(d) with respect to Requirements of Law referred to in subsections
4.8, 4.10, 4.14 or 4.15 (b)), except to the extent that the failure of the
foregoing clauses (a) (only with respect to Subsidiaries of the Borrower which
are not Guarantors), (c) and (d) to be true and correct could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.
4.4 Corporate Power; Authorization; Enforceable Obligations
Each of the Borrower and the Guarantors has the requisite corporate
power and authority, and the legal right, to make, deliver and perform the Loan
Documents to which it is a party and, in the case of the Borrower, to borrow
hereunder and has taken all necessary corporate action to authorize (in the case
of the Borrower) the borrowings on the terms and conditions of this Agreement
and any Notes and to authorize the execution, delivery and performance of the
Loan Documents to which it is a party. No consent or authorization of, filing
with, notice to or other act by or in respect of, any Governmental Authority or
any other Person is required with respect to the Borrower or any of its
Subsidiaries in connection with the borrowings hereunder or with the execution,
delivery, performance, validity or enforceability of the Loan Documents to which
the Borrower or any Guarantor is a party. This Agreement and each other Loan
Document to which the Borrower or any Guarantor is, or is to become, a party has
been or will be, duly executed and delivered on behalf of the Borrower or such
Guarantor. This Agreement and each other Loan Document to which the Borrower or
any Guarantor is, or is to become, a party constitutes or will constitute, a
legal, valid and binding obligation of the Borrower or such Guarantor, as the
case may be, enforceable against the Borrower or such Guarantor, as the case may
be, in accordance with its terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
4.5 No Legal Bar
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The execution, delivery and performance of the Loan Documents, the
borrowings hereunder and the use of the proceeds thereof will not violate any
Requirement of Law or Contractual Obligation of the Borrower or of any of its
Subsidiaries which could reasonably be expected to have a Material Adverse
Effect and will not result in, or require, the creation or imposition of any
Lien on any of its or their respective properties or revenues pursuant to any
such Requirement of Law or Contractual Obligation which could reasonably be
expected to have a Material Adverse Effect.
4.6 No Material Litigation
No litigations, investigations or proceedings of or before any
arbitrator or Governmental Authority are pending or, to the knowledge of the
Borrower, threatened by or against the Borrower or any of its Subsidiaries or
against any of its or their respective properties (a) with respect to any of the
Loan Documents or any of the transactions contemplated hereby or thereby, or (b)
which if adversely determined would, individually or in the aggregate, have a
Material Adverse Effect.
4.7 No Default
Neither the Borrower nor any of its Subsidiaries is in default under
or with respect to any of its Contractual Obligations in any respect which could
reasonably be expected to have a Material Adverse Effect. No Default or Event of
Default has occurred and is continuing. Each of the Borrower and its
Subsidiaries and the Guarantors has satisfied all outstanding judgments (other
than any such judgment which has been stayed pending appeal) and neither the
Borrower nor any of its Subsidiaries is in default with respect to any
outstanding judgment, writ, injunction, decree, rule or regulation of any court,
arbitrator or federal, state, municipal or other governmental authority,
commission, board, bureau, agency or instrumentality, domestic or foreign,
except to the extent that such defaults would not, in any case or in the
aggregate, have a Material Adverse Effect.
4.8 Taxes
Except as set forth on Schedule 4.8, each of the Borrower and its
Subsidiaries has filed or caused to be filed all Federal, state, and other
material tax returns which, to the knowledge of the Borrower, are required to be
filed and has paid all taxes shown to be due and payable on said returns or on
any assessments made against it (other than any the amount or validity of which
are currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on the
books of the Borrower or its Subsidiaries, as the case may be), except to the
extent that the failure to do so could not reasonably be expected to result in a
Material Adverse Effect.
4.9 Purpose of Loans
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The purpose of the Loans is to finance the Transaction and to pay
related fees and expenses.
4.10 Environmental Matters
Except to the extent that the failure of the following statements to
be true and correct could not reasonably be expected to have a Material Adverse
Effect:
(a) The facilities and properties owned, leased or operated by the
Borrower or any of its Subsidiaries (the "Properties") do not contain, and have
not previously contained, any Materials of Environmental Concern in amounts or
concentrations which (i) constitute or constituted a violation of, or (ii) could
reasonably be expected to give rise to liability under, any Environmental Law.
(b) The Properties and all operations at the Properties are in
compliance, and have in the last five years been in compliance, in all material
respects with all applicable Environmental Laws, and there is no contamination
at, under or about the Properties or violation of any Environmental Law with
respect to the Properties or the business operated by the Borrower or any of its
Subsidiaries (the "Business") which could reasonably be expected to materially
interfere with the continued operation of the Properties or materially impair
the fair saleable value thereof.
(c) Neither the Borrower nor any of its Subsidiaries has received
any notice of violation, alleged violation, non-compliance, liability or
potential liability regarding environmental matters or compliance with
Environmental Laws with regard to any of the Properties or the Business, nor
does the Borrower have knowledge or reason to believe that any such notice will
be received or is being threatened.
(d) Materials of Environmental Concern have not been transported or
disposed of from the Properties in violation of, or in a manner or to a location
which could reasonably be expected to give rise to liability under, any
Environmental Law, nor have any Materials of Environmental Concern been
generated, treated, stored or disposed of at, on or under any of the Properties
in violation of, or in a manner that could reasonably be expected to give rise
to liability under, any applicable Environmental Law.
(e) No judicial proceeding or governmental or administrative action
is pending or, to the knowledge of the Borrower, threatened, under any
Environmental Law to which the Borrower or any Subsidiary is or will be named as
a party with respect to the Properties or the Business, nor are there any
consent decrees or other written decrees, consent orders, administrative orders
or other orders, or other final administrative or judicial requirements
outstanding under any Environmental Law with respect to the Properties or the
Business.
32
(f) There has been no release or threat of release of Materials of
Environmental Concern at or from the Properties, or arising from or related to
the operations of the Borrower or any Subsidiary in connection with the
Properties or otherwise in connection with the Business, in violation of or in
amounts or in a manner that could reasonably be expected to give rise to
liability under Environmental Laws.
4.11 Disclosure
The statements and information contained herein and in any of the
information provided to the Administrative Agent or the Lenders in writing
(other than financial projections) in connection with or pursuant to this
Agreement, taken as a whole, do not contain any untrue statement of any material
fact, or omit to state a fact necessary in order to make such statements or
information not misleading in any material respect, in each case in light of the
circumstances under which such statements were made or information provided as
of the date so provided; provided that the foregoing shall be limited to the
actual knowledge of the appropriate officers of the Borrower solely in respect
of information specifically relating to the Target and its subsidiaries on or
before the Closing Date. The financial projections furnished to the
Administrative Agent and the Lenders in writing in connection with this
Agreement, have been prepared in good faith based upon assumptions which were in
the Borrower's judgment reasonable when such projections were made, it being
acknowledged that such projections are subject to the uncertainty inherent in
all projections of future results and that there can be no assurance that the
results set forth in such projections will in fact be realized.
4.12 Ownership of Property; Liens
Each of the Borrower and its Subsidiaries has good record and
marketable title in fee simple to, or valid leasehold interests in, all real
property necessary or used in the ordinary conduct of its business, except for
such defects in title as could not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect. As of the Closing Date, the
property of the Borrower and its Subsidiaries is subject to no Liens, other than
Liens permitted by subsection 7.2.
4.13 ERISA Compliance
(a) Each Plan, other than any Multiemployer Plan, has been operated
and administered in compliance with the applicable provisions of ERISA, the Code
and other applicable Requirements of Law, except to the extent of any
noncompliance which could not reasonably be likely to result in a Material
Adverse Effect. Each Plan that is intended to qualify under Section 401(a) of
the Code has received a favorable determination letter from the IRS or an
application for such a letter is currently being processed by the IRS with
respect thereto or the remedial amendment period for such Plan under Section
401(b) of the Code has not yet expired or the Plan is a prototype plan or volume
submitter plan for which a favorable determination letter is not required and,
to the best knowledge of the Borrower, nothing has occurred that has or could
reasonably be expected to result in a Material Adverse Effect (i) which has not
been
33
remedied which would prevent, or cause the loss of, such qualification, or (ii)
as to which the Borrower does not intend to commence and complete all necessary
and required remedial measures within statutorily or regulatory prescribed
periods of time for such remedies to be undertaken so as to prevent, or cause
the loss of, such qualification. The Borrower and each ERISA Affiliate have made
all required contributions to each Plan subject to Section 412 of the Code
within the period required under applicable Requirements of Law, and no
application for a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of the Borrower,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan that could be reasonably be expected to have a Material
Adverse Effect. There has been no non-exempt "prohibited transaction," as
defined in Section 406 of ERISA or Section 4975 of the Code, or violation of the
fiduciary responsibility rules with respect to any Plan that has resulted or
could reasonably be expected to result in a Material Adverse Effect.
(c) (i) No Reportable Event has occurred or is reasonably expected
to occur with respect to any Plan; (ii) no Plan that is intended to qualify
under Section 401(a) of the Code has any unfunded vested liability (i.e., the
excess of a pension plan's benefit liabilities under Section 4001(a)(16) of
ERISA, over the current value of that pension plan's assets, determined in
accordance with the assumptions used for funding such Plan pursuant to Section
412 of the Code for the applicable plan year); (iii) neither the Borrower nor
any ERISA Affiliate has incurred, or reasonably expects to incur, any material
liability under Title IV of ERISA with respect to any Plan (other than premiums
due and not delinquent under Section 4007 of ERISA); (iv) neither the Borrower
nor any ERISA Affiliate has incurred, or reasonably expects to incur, any
material liability (and no event has occurred which, with the giving of notice
under Section 4219 of ERISA, would result in such material liability) under
Section 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and (v)
neither the Borrower nor any ERISA Affiliate has engaged in a transaction that
could be reasonably expected to be subject to Section 4069 or 4212(c) of ERISA.
4.14 Subsidiaries
The Borrower has no Subsidiaries other than those specifically
disclosed in Part (a) of Schedule 4.14 (other than those which are "shell" or
"inactive" Subsidiaries, as such terms are defined in subsection 7.4(d)) and has
no equity investments in any other corporation or entity other than those
specifically disclosed in Part (b) of Schedule 4.14.
4.15 Margin Regulations; Investment Company Act; Public Utility
Holding Company Act
(a) The Borrower is not engaged and will not engage, principally or
as one of its important activities, in the business of purchasing or carrying
margin stock (within the
34
meaning of Regulation U issued by the Board of Governors of the Federal Reserve
System), or extending credit for the purpose of purchasing or carrying margin
stock.
(b) None of the Borrower, any Person controlling the Borrower, or
any Subsidiary (i) is a "holding company," or a "subsidiary company" of a
"holding company," or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company," within the meaning of the Public Utility
Holding Company Act of 1935, or (ii) is or is required to be registered as an
"investment company" under the Investment Company Act of 1940.
SECTION 5. CONDITIONS PRECEDENT
5.1 Conditions to Loans
The agreement of each Lender to make the Loan requested to be made
by it is subject to the satisfaction on the Closing Date of the following
conditions precedent:
(a) Unless waived by all the Lenders, the Administrative Agent's
receipt of the following, each of which shall be originals unless otherwise
specified, each properly executed by a Responsible Officer of the Borrower or a
Guarantor, as the case may be, each dated the Closing Date (or, in the case of
certificates of governmental officials, a recent date before the Closing Date)
and each in form and substance reasonably satisfactory to the Administrative
Agent and its legal counsel:
(i) executed counterparts of this Agreement, sufficient in
number for distribution to the Administrative Agent, each Lender,
the Borrower and each Guarantor;
(ii) Notes executed by the Borrower in favor of each Lender
requesting such a Note, each in a principal amount equal to such
Lender's Commitment;
(iii) such certificates of resolutions or other action,
incumbency certificates and/or other certificates of Responsible
Officers of the Borrower and/or any of the Guarantors as the
Administrative Agent may require to evidence the identities,
authority and capacity of each Responsible Officer thereof
authorized to act as a Responsible Officer in connection with this
Agreement and the other Loan Documents;
(iv) such documents and certifications as the Administrative
Agent may reasonably require to evidence that each of the Borrower
and each Guarantor is duly organized or formed, validly existing, in
good standing and qualified to engage in business in each
jurisdiction in which it is required to be qualified to engage in
business to the extent the failure to be so qualified could
reasonably be expected to have a Material Adverse Effect, including
certified copies of the organization documents, certificates of good
standing and/or qualification to engage in business with respect to
the Borrower and the Guarantors;
35
(v) a certificate signed by a Responsible Officer of the
Borrower certifying (A) that the conditions specified in subsections
5.1(d) and (e) have been satisfied, and (B) that there is no event
or circumstance, or action, suit, investigation or proceeding
pending or threatened in any court or before any arbitrator or
Governmental Authority, since December 27, 2003 which has or could
be reasonably expected to have a Material Adverse Effect;
(vi) an opinion of counsel to the Borrower and the Guarantors
in substantially in the form set forth in Exhibit D;
(vii) the Transaction shall have been or shall concurrently be
consummated for aggregate consideration not to exceed
E270,000,000;
(viii) a compliance certificate in the form attached hereto as
Exhibit E, signed by a Responsible Officer of the Borrower dated as
of the Closing Date demonstrating compliance with the financial
covenants contained in subsection 7.1 as of the end of the fiscal
quarter most recently ended prior to the Closing Date; and
(ix) such other assurances, certificates, documents, consents
or opinions as the Administrative Agent or the Majority Lenders may
reasonably require.
(b) Any fees required to be paid on or before the Closing Date shall
have been paid.
(c) The Borrower shall have paid all Attorney Costs of the
Administrative Agent to the extent invoiced prior to or on the Closing Date,
plus such additional amounts of Attorney Costs as shall constitute its
reasonable estimate of Attorney Costs incurred or to be incurred by it through
the closing proceedings (provided that such estimate shall not thereafter
preclude a final settling of accounts between the Borrower and the
Administrative Agent).
(d) Each of the representations and warranties made by the Borrower
or any Guarantor in or pursuant to the Loan Documents shall be true and correct
in all material respects on and as of the Closing Date (or, if such
representation or warranty is expressly stated to have been made as of a
specific date, as of such specific date).
(e) No Default or Event of Default shall have occurred and be
continuing on such date or after giving effect to the Loans requested to be
made.
(f) In the good faith judgment of the Administrative Agent and the
Lenders:
(i) there shall not have occurred or become known to the
Administrative Agent or any of the Lenders any event, condition,
situation or status since the date of the information contained in
the financial and business
36
projections, budgets, pro forma data and forecasts concerning the
Borrower and its Subsidiaries delivered to the Administrative Agent
and the Lenders prior to the Closing Date that has had or could
reasonably be expected to result in a Material Adverse Effect;
(ii) no litigation, action, suit, investigation or other
arbitral, administrative or judicial proceeding shall be pending or
threatened which could reasonably be likely to result in a Material
Adverse Effect; and
(iii) the Borrower shall have received all approvals, consents
and waivers, and shall have made or given all necessary filings and
notices, as shall be required to consummate the Transaction and the
other transactions contemplated hereby without the occurrence of any
material default under, conflict with or violation of (A) any
applicable law, rule, regulation, order or decree of any
Governmental Authority or arbitral authority or (B) any agreement,
document or instrument to which the Borrower, the Target or any
Subsidiary is a party or by which any of them or their properties is
bound other than any dispositions required to be made in connection
with regulatory approvals and permitted under subsection 7.4(f).
SECTION 6. AFFIRMATIVE COVENANTS
The Borrower hereby agrees that, so long as the Commitments (or any of
them) remain in effect or any amount is owing to any Lender or the
Administrative Agent hereunder or under any other Loan Document, the Borrower
shall, and (except in the case of delivery of financial information, reports and
notices) shall cause each of its Subsidiaries to:
6.1 Financial Statements.
Furnish to each Lender:
(a) as soon as available, but in any event within 90 days after the
end of each fiscal year of the Borrower, a copy of the audited consolidated and
consolidating balance sheets of the Borrower and its consolidated Subsidiaries
as at the end of such year and the related consolidated and consolidating
statements of operations and stockholders' equity and of cash flows for such
year, setting forth in each case in comparative form the figures as of the end
of and for the previous year, reported on without a qualification arising out of
the scope of the audit, by BDO Seidman, LLP or any other independent certified
public accountants of nationally recognized standing reasonably acceptable to
the Majority Lenders, including a break-out of each Guarantor on a separate
schedule and an executive summary of the management letter prepared by such
accountants; provided, however, that if a Default or Event of Default shall have
occurred and shall be continuing, the full text of such management letter shall
be provided to the Administrative Agent; and
37
(b) as soon as available, but in any event not later than 45 days
after the end of each of the first three quarterly periods of each fiscal year
of the Borrower, the unaudited consolidated and consolidating balance sheets of
the Borrower and its consolidated Subsidiaries as at the end of each such
quarter and the related unaudited consolidated and consolidating statements of
operations and of cash flows for such quarter and the portion of the fiscal year
through the end of such quarter, setting forth in each case in comparative form
the figures as of the end of and for the corresponding period or periods in the
previous year, including a break-out of each Guarantor on a separate schedule
certified by a Responsible Officer of the Borrower as being fairly stated in all
material respects (subject to normal, recurring, year-end audit adjustments and
the absence of GAAP notes thereto).
(c) All such financial statements shall be prepared in reasonable
detail and in accordance with GAAP applied consistently throughout the periods
reflected therein and with prior periods (subject, in the case of the aforesaid
quarterly financial statements, to normal, recurring, year-end audit adjustments
and the absence of GAAP notes thereto).
6.2 Certificates; Other Information
Furnish to the Administrative Agent and each of the Lenders:
(a) simultaneously with the delivery of the financial statements
referred to in subsections 6.1(a) and (b), a certificate of the chief financial
officer of the Borrower, certifying that to the best of his knowledge (i) no
Default or Event of Default has occurred and is continuing or, if a Default or
Event of Default has occurred and is continuing, a statement as to the nature
thereof and the action which is proposed to be taken with respect thereto, with
computations demonstrating compliance (or non-compliance, as the case may be)
with the covenants contained in subsection 7.1, and (ii) such financial
statements have been prepared in accordance with GAAP (subject in the case of
subsection 6.1(b) to normal, recurring, year-end adjustments and except for the
absence of GAAP notes thereto);
(b) promptly, such additional financial and other information as the
Administrative Agent or any Lender through the Administrative Agent may from
time to time reasonably request;
(c) promptly after the same are available, and in any event within
five Business Days after the sending or filing thereof, copies of all proxy
statements, financial statements and reports which the Borrower or any of its
Subsidiaries sends to its stockholders, and copies of all regular, periodic and
special reports and all registration statements which the Borrower or any such
Subsidiary files with the Securities and Exchange Commission or any governmental
authority which may be substituted therefor, or with any national securities
exchange or state securities administration;
(d) simultaneously with the delivery of the annual financial
statements referred to in subsection 6.1(a), a certificate of the independent
public accountants who audited
38
such statements to the effect that, in making the examination necessary for the
audit of such statements, they have obtained no knowledge of any condition or
event which constitutes a Default or Event of Default, or if such accountants
shall have obtained knowledge of any such condition or event, specifying in such
certificate each such condition or event of which they have knowledge and the
nature and status thereof; and
(e) within 45 days after the end of each fiscal year of the
Borrower, the annual budget of the Borrower and its Subsidiaries for the then
current fiscal year in a form reasonably satisfactory to the Lenders, and copies
of any material updates, amendments or modifications to the Borrower's
"Corporate Strategic Plan" from time to time, within five Business Days after
the occurrence and completion of the same.
6.3 Conduct of Business and Maintenance of Existence
(a) Preserve, renew and keep in full force and effect its corporate
existence and good standing under the laws of its jurisdiction of organization
(except as could not in the aggregate be reasonably expected to have a Material
Adverse Effect or as is otherwise permitted pursuant to subsection 7.12), (b)
take all reasonable action to maintain all rights, privileges and franchises
necessary in the normal conduct of its business, except as otherwise permitted
pursuant to subsection 7.12 and (c) comply with all Contractual Obligations and
Requirements of Law except to the extent that failure to comply therewith could
not, in the aggregate, be reasonably expected to have a Material Adverse Effect.
6.4 Payment of Obligations
Pay and discharge all of its obligations and liabilities as the same
shall become due and payable, including (a) all tax liabilities, assessments and
governmental charges or levies upon it or its properties or assets, unless the
same are being contested in good faith by appropriate proceedings diligently
conducted and adequate reserves in accordance with GAAP are being maintained by
the Borrower or such Subsidiary; (b) all lawful claims which, if unpaid, would
by law become a Lien upon its property (other than Liens permitted by subsection
7.2); and (c) all Indebtedness, as and when due and payable (after giving effect
to any applicable grace periods), (i) but subject to any subordination
provisions contained in any instrument or agreement evidencing such Indebtedness
and (ii) unless the same are being contested in good faith by appropriate
proceedings diligently conducted and adequate reserves in accordance with GAAP
are being maintained by the Borrower or such Subsidiary.
6.5 Maintenance of Properties
(a) Maintain, preserve and protect all of its material properties
and equipment necessary in the operation of its business in good working order
and condition, ordinary wear and tear excepted; and (b) make all necessary
repairs thereto and renewals and replacements thereof except where the failure
to do so could not reasonably be expected to have a Material Adverse Effect.
39
6.6 Maintenance of Insurance
Maintain with financially sound and reputable insurance companies,
insurance with respect to its properties and business against loss or damage of
the kinds customarily insured against by Persons engaged in the same or similar
business, of such types and in such amounts as are customarily carried under
similar circumstances by such other Persons; and furnish to the Administrative
Agent, upon written request, information as to the insurance carried.
6.7 Books and Records
(a) Maintain proper books of record and account in conformity with
GAAP (or, in the case of foreign Subsidiaries, generally accepted accounting
principles in the applicable jurisdiction) consistently applied in which all
entries required by GAAP (or, in the case of foreign Subsidiaries, generally
accepted accounting principles in the applicable jurisdiction) shall be made of
all financial transactions and matters involving the assets and business of the
Borrower and its Subsidiaries, and (b) maintain such books of record and account
in conformity with all applicable requirements of any Governmental Authority
having regulatory jurisdiction over the Borrower or any of its Subsidiaries,
except where the failure to so comply would not result in a Material Adverse
Effect.
6.8 Inspection Rights
Subject to subsection 10.14, permit representatives and independent
contractors of the Administrative Agent and each Lender to visit and inspect any
of its properties, to examine its corporate, financial and operating records,
and make copies thereof or abstracts therefrom, and to discuss its affairs,
finances and accounts with its officers and independent public accountants, at
such reasonable times during normal business hours as may be reasonably desired,
upon reasonable advance notice to a Responsible Officer of the Borrower or such
Guarantor, as the case may be; provided, however, that (a) the Lenders shall use
reasonable efforts to coordinate with the Administrative Agent in order to
minimize the number of such inspections and discussions; (b) with respect to
access for environmental inspections, the Administrative Agent shall only have
the right to inspect once during the term of this Agreement unless the
Administrative Agent has reason to believe that a condition exists or an event
has occurred which reasonably could give rise to liability under the
Environmental Laws and (c) when an Event of Default has occurred and is
continuing, the Administrative Agent or any Lender (or any of their respective
representatives or independent contractors) may do any of the foregoing at the
expense of the Borrower at any time during normal business hours and without
advance notice.
6.9 Compliance with ERISA
Do, and cause each of its ERISA Affiliates to do, each of the
following: (a) maintain each Plan in material compliance with the applicable
provisions of ERISA, the Code
40
and other applicable Requirements of Law; (b) cause each Plan which is qualified
under Section 401(a) of the Code to maintain such qualification; and (c) make
all required contributions to any Plan subject to Section 412 of the Code within
the period required under applicable Requirements of Law.
6.10 Environmental Compliance
If the Borrower or any Subsidiary shall receive any written letter,
notice, complaint, order, directive, claim or citation alleging that any
Borrower or any Subsidiary has violated any Environmental Law, has released any
Matters of Environmental Concern, or is liable for the costs of cleaning up,
removing, remediating or responding to a release of Matters of Environmental
Concern, within the time period permitted and to the extent required by the
applicable Environmental Law or the Governmental Authority responsible for
enforcing such Environmental Law, remove or remedy, or cause the applicable
Subsidiary to remove or remedy, such violation or release or satisfy such
liability unless (a) the failure to remove or remedy such violation or release
or to satisfy such liability would not reasonably be expected to have a Material
Adverse Effect, in which case the Borrower shall notify the Administrative Agent
of any decision not to remove or remedy such violation or release or satisfy
such liability and the basis for any such decision, and at the Administrative
Agent's option and at its request, the Borrower shall provide written
documentation of such decision, or (b) such violation or liability is being
contested in good faith by appropriate proceedings and appropriate reserves
therefor are being maintained in accordance with GAAP.
6.11 Use of Proceeds
Use the proceeds of Loans to finance the Transaction and to pay
related fees and expenses, including attorney's fees, investment banking fees,
accountant's fees, underwriting discounts and commissions and other customary
fees and expenses actually incurred in connection therewith.
6.12 Notices
Promptly give notice to the Administrative Agent and each Lender
upon obtaining actual knowledge of:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any Contractual
Obligation of the Borrower or any of its Subsidiaries, or (ii) litigation,
investigation or proceeding which, in either case, could reasonably be expected
to have a Material Adverse Effect;
(c) the following events, as soon as possible and in any event
within 30 days after the Borrower knows thereof: (i) the occurrence or
reasonably expected occurrence of any Reportable Event with respect to any Plan,
a failure to make any required contribution to a Plan
41
within the period required by applicable law, the creation of any Lien in favor
of the PBGC or a Plan or any withdrawal from, or the termination, Reorganization
or Insolvency of, any Multiemployer Plan or (ii) the institution of proceedings
or the taking of any other similar action by the PBGC or the Borrower or any
Commonly Controlled Entity or any Multiemployer Plan with respect to the
withdrawal from, or the terminating, Reorganization or Insolvency of, any Plan,
other than the termination of any Single Employer Plan that is not a distress
termination pursuant to Section 4041(c) of ERISA where, with respect to any
event listed above, the amount of liability the Borrower or any Commonly
Controlled Entity could reasonably be expected to have a Material Adverse
Effect; and
(d) (i) simultaneously with the delivery of the financial statements
referred to in subsections 6.1(a) and (b), quarterly reports in form and
substance satisfactory to the Administrative Agent, describing all Acquisitions
consummated by the Borrower or any of its Subsidiaries during the preceding
fiscal quarter, which reports shall include, with respect to each Acquisition
involving total consideration paid or total assets acquired, in either case, in
excess of $25,000,000, pro forma calculations demonstrating that after giving
effect to such Acquisition, no Default or Event of Default is occurring, and
(ii) any notices or information which may be required pursuant to subsection
7.12.
Each notice pursuant to this subsection shall be accompanied by a statement of a
Responsible Officer of the Borrower setting forth details of the occurrence
referred to therein and stating what action the Borrower proposes to take with
respect thereto.
6.13 Additional Guarantors
Simultaneously with (a) any Person becoming a Significant Subsidiary
or (b) any Subsidiary or Affiliate becoming a guarantor under or with respect to
any of the Note Purchase Agreements or the Existing Credit Agreement, cause such
Person to enter into a guarantee assumption agreement in the form of Exhibit A
(or such other agreement in form and substance reasonably acceptable to the
Majority Lenders), and thereupon such Person shall become a Guarantor hereunder
for all purposes.
SECTION 7. NEGATIVE COVENANTS
The Borrower hereby agrees that, so long as the Commitments (or any of
them) remain in effect or any amount is owing to any Lender or the
Administrative Agent hereunder or under any other Loan Document, the Borrower
shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly:
7.1 Financial Covenants
(a) Consolidated Leverage Ratio. Permit the Consolidated Leverage
Ratio at any time during any period of four consecutive fiscal quarters of the
Borrower to exceed 3.0 to 1.0.
42
(b) Consolidated Interest Coverage Ratio. Permit the Consolidated
Interest Coverage Ratio at any time during any period of four consecutive fiscal
quarters of the Borrower to be less than 5.0 to 1.0.
7.2 Limitation on Liens
Create, incur, assume or suffer to exist any Lien upon any of its
property, assets or revenues, whether now owned or hereafter acquired, except
for:
(a) Liens for taxes not yet due or which are being contested in good
faith by appropriate proceedings, provided that adequate reserves with respect
thereto are maintained on the books of the Borrower or its Subsidiaries, as the
case may be, in conformity with GAAP;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of business which
are not overdue for a period of more than 30 days or which are being contested
in good faith by appropriate proceedings diligently conducted, if adequate
reserves with respect thereto are maintained on the books of the applicable
Person in accordance with GAAP;
(c) pledges or deposits made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance and other social
security legislation and deposits made in the ordinary course of business
securing liability to insurance carriers under insurance or self-insurance
arrangements;
(d) deposits to secure the performance of bids, trade or government
contracts (other than for borrowed money), leases, statutory obligations, surety
and appeal bonds, performance bonds and other obligations of a like nature
incurred in the ordinary course of business;
(e) easements, rights-of-way, restrictions, building, zoning and
other similar encumbrances or restrictions, utility agreements, covenants,
reservations and encroachments and other similar encumbrances, or leases or
subleases, incurred in the ordinary course of business which, in the aggregate,
are not substantial in amount and which do not, in the aggregate, materially
detract from the value of the properties of the Borrower and its Subsidiaries,
taken as a whole, or materially interfere with the ordinary conduct of the
business of the Borrower and its Subsidiaries, taken as a whole;
(f) Liens securing Indebtedness in respect of capital leases and
purchase money obligations for fixed or capital assets; provided that (i) such
Liens do not at any time encumber any property other than the property financed
by such Indebtedness, (ii) the Indebtedness secured thereby does not exceed the
cost or Fair Market Value, whichever is lower, of the property being acquired on
the date of acquisition and (iii) such Indebtedness was not incurred in
connection with, or in anticipation or contemplation of, a Permitted
Acquisition;
43
(g) Liens on the assets of Receivable Subsidiaries created pursuant
to any Receivables Transaction permitted pursuant to subsection 7.3(a);
(h) Liens created or arising pursuant to any Loan Documents;
(i) Liens granted by any Subsidiary in favor of the Borrower;
(j) judgment and other similar Liens arising in connection with
court proceedings in an aggregate amount not in excess of $1,000,000 (except to
the extent covered by independent third-party insurance) provided that the
execution or other enforcement of such Liens is effectively stayed and the
claims secured thereby are being actively contested in good faith and by
appropriate proceedings;
(k) Liens arising from precautionary UCC financing statements
regarding operating leases or consignments;
(l) Liens on assets of the Target and its subsidiaries which are
assumed pursuant to the terms of the Purchase Agreements, provided that such
Liens (other than Liens otherwise permitted pursuant to this Section 7.2) are
released on or prior to the date that is five Business Days after the Closing
Date; or
(m) Liens (not otherwise permitted hereunder) which secure
obligations or Indebtedness of the Borrower or any of its Subsidiaries not
exceeding an aggregate amount of $20,000,000 at any time outstanding.
7.3 Limitation on Indebtedness
Create, issue, incur, assume, become liable in respect of or suffer
to exist:
(a) any Indebtedness pursuant to any Receivables Transaction, except
for Indebtedness pursuant to all Receivables Transactions that is (i)
non-recourse with respect to the Borrower and its Subsidiaries (other than any
Receivables Subsidiary) and (ii) in an aggregate principal amount at any time
outstanding not exceeding 10% of Consolidated Total Assets at such time;
(b) any Indebtedness of any of the Subsidiaries other than (i)
Indebtedness of any Receivables Subsidiary pursuant to any Receivables
Transaction permitted under subsection 7.3(a), (ii) any Indebtedness of any
Subsidiary as a guarantor under or pursuant to any of the Note Purchase
Agreements or the Existing Credit Agreement, (iii) any Indebtedness of any
Subsidiary which is a Guarantor, (iv) any Indebtedness arising in respect of
capital leases or purchase money obligations incurred in accordance with
subsection 7.2(f), and (v) any other Indebtedness of Subsidiaries in an
aggregate principal amount at any time outstanding not to exceed five percent of
Consolidated Total Assets at such time; or
44
(c) Indebtedness of the Target and its subsidiaries incurred
pursuant to the terms of the Purchase Agreements, provided that such
Indebtedness is paid in full on or prior to the date that is five Business Days
after the Closing Date.
7.4 Fundamental Changes
Liquidate, windup or dissolve (or suffer any liquidation or
dissolution), or merge, consolidate with or into, or convey, transfer, lease,
sell, assign or otherwise dispose of (whether in one transaction or in a series
of transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to or in favor of any Person, except that, so long as no
Default or Event of Default exists or would result therefrom:
(a) any Subsidiary may merge with (i) the Borrower, provided that
the Borrower shall be the continuing or surviving Person, or (ii) any one or
more Subsidiaries, provided that (A) when any wholly-owned Subsidiary is merging
with another Subsidiary, such wholly-owned Subsidiary shall be the continuing or
surviving Person and (B) when any Foreign Subsidiary is merging with a Domestic
Subsidiary, such Domestic Subsidiary shall be the continuing or surviving
Person;
(b) any (i) Subsidiary may sell, transfer, contribute, convey or
otherwise dispose of all or substantially all of its assets (upon voluntary
liquidation or otherwise), to the Borrower or to a Domestic Subsidiary; provided
that if the transferor in such a transaction is a wholly-owned Subsidiary, then
the transferee must also be a wholly-owned Subsidiary; or (ii) Foreign
Subsidiary may sell, transfer, contribute, convey or otherwise dispose of all of
its assets (upon voluntary liquidation or otherwise), to any other Foreign
Subsidiary;
(c) any Subsidiary formed solely for the purpose of effecting a
Permitted Acquisition may be merged or consolidated with any other Person;
provided that the continuing or surviving corporation of such merger or
consolidation shall be a Subsidiary and provided that such transaction otherwise
satisfies the requirements of a Permitted Acquisition under subsection 7.12;
(d) "Inactive" or "shell" Subsidiaries (i.e., a Person that is not
engaged in any business and that has total assets of $500,000 or less) may be
dissolved or otherwise liquidated, provided that all of the assets and
properties of any such Subsidiaries are transferred to the Borrower upon
dissolution/liquidation;
(e) the Borrower may merge or consolidate with any Person, provided
that the Borrower shall be the continuing or surviving Person and provided the
transaction otherwise satisfies the requirements of a Permitted Acquisition
under subsection 7.12; and
(f) any Subsidiary may Dispose of assets located in Germany or Italy
pursuant to regulatory approvals required to consummate the Transaction under
the laws of Germany or Italy, as the case may be; provided that to the extent
the Net Cash Proceeds received
45
by the Borrower and its Subsidiaries pursuant to such Dispositions exceed
$60,000,000 in the aggregate, then (i) in the case of any such Disposition
consummated on or prior to the Closing Date, the Commitments shall be reduced by
an amount equal to the amount of such Net Cash Proceeds in accordance with
subsection 2.4(c) or (ii) in the case of any such Disposition consummated
subsequent to the Closing Date, the Loans shall be prepaid in an amount equal to
the amount of such Net Cash Proceeds in accordance with subsection 3.1(b).
7.5 Dispositions
Make any Disposition or enter into any agreement to make any
Disposition, except:
(a) Dispositions of obsolete, out-moded or worn-out property,
whether now owned or hereafter acquired, in the ordinary course of business;
(b) Dispositions of inventory in the ordinary course of business;
(c) Dispositions of property by any Subsidiary to the Borrower;
(d) Dispositions of Receivables pursuant to Receivables Transactions
permitted under subsection 7.3(a);
(e) The nonexclusive license of intellectual property of the
Borrower or any of its Subsidiaries to third parties in the ordinary course of
business;
(f) Without limitation to clause (a), the Borrower and its
Subsidiaries may sell or exchange specific items of machinery or equipment, so
long as the proceeds of each such sale or exchange is used (or contractually
committed to be used) to acquire (and results within one year of such sale or
exchange in the acquisition of) replacement items of machinery or equipment of
reasonably equivalent Fair Market Value;
(g) Dispositions permitted under, and subject to the requirements
of, subsection 7.4(f); and
(h) Other Dispositions where (i) in the good faith opinion of the
Borrower, the Disposition is an exchange for consideration having a Fair Market
Value at least equal to that of the property Disposed of and is in the best
interest of the Borrower or the applicable Subsidiary, as the case may be; (ii)
immediately after giving effect to such Disposition, no Default or Event of
Default would exist; and (iii) immediately after giving effect to such
Disposition, the Disposition value of all property that was the subject thereof
in any fiscal four quarter period of the Borrower plus the Fair Market Value of
any other property Disposed of during such four quarter period does not equal or
exceed 15% of Consolidated Total Assets as of the end of the then most recently
ended fiscal quarter of Borrower.
46
7.6 ERISA
Engage in a transaction which could be subject to Section 4069 or
4212(c) of ERISA, or permit any Plan to (a) engage in any non-exempt "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the Code);
(b) fail to comply with ERISA or any other applicable Laws; or (c) incur any
material "accumulated funding deficiency" (as defined in Section 412 of the Code
or Section 302 of ERISA), which, with respect to any event listed above, could
reasonably be expected to have a Material Adverse Effect.
7.7 Swap Agreements
Enter into any Swap Agreement, except (a) Swap Agreements entered
into to hedge or mitigate risks to which the Borrower or any Subsidiary has
actual exposure (other than those in respect of Equity Interests or Restricted
Payments of the Borrower or any of its Subsidiaries), including hedging
agreements with respect to raw materials to be used in the business of Borrower
and its Subsidiaries, (b) Swap Agreements entered into in order to effectively
cap, collar or exchange interest rates (from fixed to floating rates, from one
floating rate to another floating rate or otherwise) with respect to any
interest-bearing liability or investment of the Borrower or any Subsidiary and
(c) Swap Agreements of the Target and its subsidiaries listed on Schedule 7.7(c)
which continue to be in effect following consummation of the Transaction.
7.8 Conduct of Business
From and after the Closing Date, engage in any business other than
the distribution of medical, dental, veterinary, hospital or health care
products, equipment or related services and/or technology, those businesses
ancillary thereto or such other lines of business in which the Borrower and/or
its Subsidiaries are engaged as of the Closing Date.
7.9 Transactions with Affiliates
Enter into any transaction of any kind with any Affiliate of the
Borrower, other than for compensation and upon fair and reasonable terms with
Affiliates in transactions that are otherwise permitted hereunder no less
favorable to the Borrower or any Subsidiary than would be obtained in a
comparable arm's-length transaction with a Person other than an Affiliate,
provided, the foregoing restriction shall not apply to (a) any transaction
between the Borrower and any of its Subsidiaries or between any of its
Subsidiaries, (b) reasonable and customary fees paid to members of the Boards of
Directors of the Borrower and its Subsidiaries, (c) transactions effected as
part of a Receivables Transaction, (d) transactions which are effected pursuant
to the terms of the Purchase Agreements as in effect on the date hereof or (e)
compensation arrangements of officers and other employees of the Borrower and
its Subsidiaries entered into in the ordinary course of business.
7.10 Burdensome Agreements
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Enter into any Contractual Obligation that limits the ability in any
material respect (a) of any Subsidiary to make Restricted Payments to the
Borrower or to otherwise transfer property to the Borrower or (b) of the
Borrower or any Subsidiary to create, incur, assume or suffer to exist
Indebtedness or Liens on property of such Person, other than standard and
customary negative pledge provisions in property acquired with the proceeds of
any capital lease or purchase money financing that extend and apply only to such
acquired property.
7.11 Use of Proceeds
Use the proceeds of the Loans for any purpose other than as provided
in subsection 6.13.
7.12 Acquisitions
Enter into any agreement, contract, binding commitment or other
arrangement providing for any Acquisition, or take any action to solicit the
tender of securities or proxies in respect thereof in order to effect any
Acquisition, other than Acquisitions satisfying the conditions below (the
"Permitted Acquisitions"). So long as no Default or Event of Default has
occurred and is continuing, the Borrower or any Subsidiary of the Borrower may
engage in any Acquisition with any Person whose line or lines of business
include the distribution of medical, dental, veterinary, hospital, or health
care technology, provided that:
(a) after giving effect to any such Acquisition, no Default or Event
of Default shall exist at the time of any such Acquisition or at the time or as
a result of the consummation of the transaction contemplated thereby;
(b) the Borrower shall notify the Lenders of the consummation of any
such Acquisition, with respect to which the aggregate cash amount paid or
payable exceeds $25,000,000, within 15 Business Days of the consummation
thereof, and provide the Lenders at such time with evidence reasonably
satisfactory to the Lenders (which evidence shall include pro forma financial
statements after giving effect to the proposed Permitted Acquisition) that after
giving effect to such Acquisition, no Default or Event of Default shall have
existed at the time of any such Acquisition or at the time or as a result of the
consummation of the transactions contemplated thereby;
(c) the aggregate cash amounts paid or payable with respect to any
one Acquisition (whether structured as a single transaction or a series of
related transactions) from and after the date hereof to and including the
Maturity Date shall not exceed $50,000,000 at the time of consummation of any
such transaction without the prior written consent of the Majority Lenders;
(d) if, upon the closing of the transactions contemplated by an
Acquisition, any such acquiring or acquired Person is or becomes a Significant
Subsidiary, simultaneously
48
with a consummation of such transaction such Significant Subsidiary shall become
a Guarantor pursuant to the provisions of subsection 6.13; and
(e) notwithstanding anything contained herein to the contrary, no
hostile takeover shall be attempted or consummated (i.e., an Acquisition that
has not been either (1) approved by the board of directors of the corporation
which is the subject of such Acquisition or (2) recommended for approval by such
board to the shareholders of such corporation and subsequently approved by the
shareholders of such corporation as required under applicable law or by the
by-laws and the certificate or incorporation of such corporation).
7.13 Investments, Loans, Advances, Guarantees and Acquisitions
The Borrower will not, and will not permit any of its Subsidiaries
to, purchase, hold or acquire (including pursuant to any merger with any Person
that was not a wholly owned Subsidiary prior to such merger) any Equity
Interests, evidences of indebtedness or other securities (including any option,
warrant or other right to acquire any of the foregoing) of, make or permit to
exist any loans or advances to, guarantee any obligations of, or make or permit
to exist any investment or any other interest in, any other Person, or purchase
or otherwise acquire (in one transaction or a series of transactions) any assets
of any other Person constituting a business unit (which shall not include, for
the avoidance of doubt, capital expenditures made in the ordinary course of
business), except:
(a) Permitted Investments;
(b) investments by the Borrower existing on the date hereof in the
Equity Interests of its Subsidiaries;
(c) the Borrower and its Subsidiaries may acquire and own
investments (including debt obligations) received in connection with the
bankruptcy or reorganization of suppliers and customers and in settlement of
delinquent obligations of, and other disputes with, customers and suppliers
arising in the ordinary course of business;
(d) the Borrower and its Subsidiaries may acquire and own
investments pursuant to Swap Agreements not prohibited by subsection 7.7;
(e) advances, loans and investments which are made pursuant to the
terms of the Purchase Agreements as in effect on the date hereof;
(f) deposits made in the ordinary course of business to secure the
performance of leases or other contractual arrangements shall be permitted;
(g) loans and advances by the Borrower and its Subsidiaries to
employees of the Borrower and such Subsidiaries for moving and travel and other
similar expenses or in connection with stock or stock option purchases of the
Borrower by employees of the Borrower and such Subsidiaries pursuant to
compensatory plans, arrangements or agreements in the
49
ordinary course of business, in an aggregate amount at any time outstanding not
to exceed $5,000,000;
(h) the Borrower may make intercompany loans, advances and
investments to any of its Subsidiaries which are Guarantors, any Subsidiary may
make intercompany loans, advances and investments to the Borrower and any
Subsidiary may make intercompany loans, advances and investments to any other
Subsidiary that is a Guarantor;
(i) Foreign Subsidiaries may make intercompany loans, advances and
investments to or in other Foreign Subsidiaries;
(j) investments, loans or advances made by the Borrower to (i) any
Domestic Subsidiary which is not a Guarantor or (ii) any Affiliates (other than
Subsidiaries) or Foreign Subsidiaries provided that the aggregate amount at any
time outstanding under (i) and (ii) above shall not exceed $75,000,000. For
purposes of this subparagraph (j), the amount included in "investments, loans or
advances" shall mean only (A) loans or advances which are recorded as debt in
accordance with GAAP and advances made on behalf of Affiliates or Foreign
Subsidiaries which are not repaid within 120 days of the date of such advance,
(B) the purchase price of the interest purchased (at the time of purchase) or
(C) the amount of cash or the value of assets contributed (at the time of
contribution);
(k) Guarantees constituting Indebtedness permitted by subsection
7.3;
(l) the Borrower may incur Guarantee Obligations on behalf of any
Subsidiary which is a Guarantor and any Guarantor may incur Guarantee
Obligations on behalf of the Borrower , provided that when computing the amount
of Indebtedness resulting from any such Guarantee Obligations, only the primary
obligation shall be included;
(m) the Borrower may incur Guarantee Obligations on behalf of any
Subsidiary which is not a Guarantor and any Subsidiary may incur Guarantee
Obligations on behalf of Borrower; and
(n) Acquisitions permitted by subsection 7.12 and the Transaction.
7.14 Restricted Payments
Declare or make, directly or indirectly, any Restricted Payment, or
incur any obligation (contingent or otherwise) to do so, except that:
(a) each Subsidiary may make Restricted Payments to the Borrower and
to wholly-owned Subsidiaries (and, in the case of a Restricted Payment by a
non-wholly-owned Subsidiary, to the Borrower and any Domestic Subsidiary and to
each other owner of Equity Interests of such Subsidiary on a pro rata basis
based on their relative ownership interests);
50
(b) the Borrower and each Subsidiary may declare and make Restricted
Payments or other distributions payable solely in the common stock of such
Person;
(c) the Borrower and each Subsidiary may purchase, redeem or
otherwise acquire shares of its common stock or warrants or options to acquire
any such shares with the proceeds received from the substantially concurrent
issue of new shares of its common stock; and
(d) the Borrower may declare or pay cash dividends in any fiscal
year to its stockholders and purchase, redeem or otherwise acquire shares of its
Equity Interests or warrants, rights or options to acquire any such shares for
cash; provided that no such cash payments (1) in any fiscal quarter of the
Borrower (other than any such payments which are specified in clause (2) below)
shall exceed (x) the greater of (A) $25,000,000 and (B) 40 percent of the
consolidated net income of the Borrower and its Subsidiaries for the period of
the four prior consecutive fiscal quarters of the Borrower, (determined on a
consolidated basis and as calculated consistent with the manner disclosed by the
Borrower in its Quarterly Reports on Form 10-Q and its Annual Reports on Form 10
K as filed by the Borrower from time to time with the Securities and Exchange
Commission), less (y) any such cash payments previously made during such four
fiscal quarter period, or (2) may be made by the Borrower, in an aggregate
amount exceeding $120,000,000, to repurchase shares of the Company's common
stock, $.01 par value per share, from holders thereof pursuant to the Borrower's
stock repurchase program, as authorized by the Board of Directors of the
Borrower on or about March 3, 2003; provided further that not more than
2,000,000 of such shares may be repurchased by the Borrower pursuant to such
program. For the avoidance of doubt, no cash payments made pursuant to the
foregoing clause (2) shall reduce cash payments made by the Borrower solely in
reliance on the foregoing clause (1).
SECTION 8. EVENTS OF DEFAULT
Any of the following shall constitute an Event of Default:
(a) The Borrower shall fail to pay any principal of any Loan when
due in accordance with the terms thereof or hereof; or the Borrower shall fail
to pay any interest on any Loan, or any fee or other amount payable hereunder,
within three Business Days after any such interest or other amount becomes due
in accordance with the terms thereof or hereof; or
(b) Any representation or warranty made or deemed made by the
Borrower or any Guarantor herein or in any other Loan Document or which is
contained in any certificate, document or financial or other statement furnished
by it at any time under or in connection with this Agreement shall prove to have
been incorrect or misleading in any material respect when made or deemed made or
furnished; or
(c) (i) The Borrower shall default in the observance or performance
of any covenant contained in subsection 6.8, subsection 6.11, subsection 6.12 or
Section 7; or (ii) the
51
Borrower shall default in the observance or performance of any covenant
contained in subsection 6.1, and such default shall continue unremedied for a
period of 10 days; or (iii) the Borrower shall default in the observance or
performance of any other agreement contained in this Agreement (other than as
provided above in this Section), and such default described in this clause
(c)(iii) shall continue unremedied for a period of 30 days; provided that if any
such default covered by this clause (c)(iii), (x) is not capable of being
remedied within such 30-day period, (y) is capable of being remedied within an
additional 30-day period and (z) the Borrower is diligently pursuing such remedy
during the period contemplated by (x) and (y) and has advised the Administrative
Agent as to the remedy thereof, the first 30-day period referred to in this
clause (c)(iii) shall be extended for an additional 30-day period but only so
long as (A) the Borrower continues to diligently pursue such remedy, (B) such
default remains capable of being remedied within such period and (C) any such
extension could not reasonably be expected to have a Material Adverse Effect; or
(d) The Borrower or any of the Guarantors shall (i) default in any
payment of principal of or interest on any Indebtedness (other than the Loans)
or in the payment of any Guarantee Obligation, beyond the period of grace, if
any, provided in the instrument or agreement under which such Indebtedness or
Guarantee Obligation was created; or (ii) default in the observance or
performance of any other agreement or condition relating to any such
Indebtedness or Guarantee Obligation or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event or condition is to
cause, or to permit the holder or holders of such Indebtedness or beneficiary or
beneficiaries of such Guarantee Obligation (or a trustee or agent on behalf of
such holder or holders or beneficiary or beneficiaries) to cause, with the
giving of notice if required, such Indebtedness to become due prior to its
stated maturity or such Guarantee Obligation to become payable; provided,
however, that except with respect to any Default or Event of Default of the type
described under subsection 8(d)(i) or any other material Default or Event of
Default of the type described under subsection 8(d)(ii) which shall have
occurred in connection with any of the Note Purchase Agreements or the Existing
Credit Agreement, no Default or Event of Default shall exist under this
paragraph unless the aggregate amount of Indebtedness and/or Guarantee
Obligations in respect of which any default or other event or condition referred
to in this paragraph shall have occurred shall be equal to at least $20,000,000;
or
(e) (i) The Borrower, any of its Significant Subsidiaries or any of
the Guarantors shall commence any case, proceeding or other action (A) under any
existing or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it a
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
winding-up, liquidation, dissolution, composition or other relief with respect
to it or its debts, or (B) seeking appointment of a receiver, trustee,
custodian, conservator or other similar official for it or for all or any
substantial part of its assets, or the Borrower, any of its Significant
Subsidiaries or any of the Guarantors shall make a general assignment for the
benefit of its creditors; or (ii) there shall be commenced against the Borrower,
any of its Significant
52
Subsidiaries or any of the Guarantors any case, proceeding or other action of a
nature referred to in clause (i) above which (A) results in the entry of an
order for relief or any such adjudication or appointment or (B) remains
undismissed, undischarged or unbonded for a period of 60 calendar days; or (iii)
there shall be commenced against the Borrower, any of its Significant
Subsidiaries or any of the Guarantors any case, proceeding or other action
seeking issuance of a warrant of attachment, execution, distraint or similar
process against all or any substantial part of its assets which results in the
entry of an order for any such relief which shall not have been vacated,
discharged, or stayed or bonded pending appeal within 30 calendar days from the
entry thereof; or (iv) the Borrower, any of its Significant Subsidiaries or any
of the Guarantors shall take any action in furtherance of, or indicating its
consent to, approval of, or acquiescence in, any of the acts set forth in clause
(i), (ii), or (iii) above; or (v) the Borrower, any of its Significant
Subsidiaries or any of the Guarantors shall generally not or shall admit in
writing its inability to, pay its debts as they become due; or
(f) (i) The Borrower or any Commonly Controlled Entity shall engage
in any non-exempt "prohibited transaction," as defined in Section 406 of ERISA
or Section 4975 of the Code, involving any Plan, (ii) any "accumulated funding
deficiency" (as defined in Section 302 of ERISA), whether or not waived, shall
exist with respect to any Plan or any Lien in favor of the PBGC or a Plan shall
arise on the assets of the Borrower or any Commonly Controlled Entity, (iii) a
Reportable Event shall occur with respect to, or proceedings shall commence to
have a trustee appointed (or a trustee shall be appointed) to administer, or to
terminate, any Single Employer Plan, which Reportable Event or commencement of
proceedings or appointment of a trustee is likely to result in the termination
of such Plan for purposes of Title IV of ERISA, (iv) any Single Employer Plan
shall terminate for purposes of Title IV of ERISA in a distress termination (as
defined in Section 4041(c) of ERISA), (v) the Borrower or any Commonly
Controlled Entity shall incur any liability in connection with a withdrawal
from, or the Insolvency or Reorganization of, a Multiemployer Plan or (vi) any
other event or condition shall occur or exist with respect to a Plan; and in
each case in clauses (i) through (vi) above, such event or condition, together
with all other such events or conditions, if any, has resulted in or could
reasonably be expected to result in liability in an aggregate amount of
$20,000,000 or more; or
(g) One or more judgments or decrees shall be entered against the
Borrower or any of its Subsidiaries involving in the aggregate a liability (not
paid or in excess of the amount recoverable by insurance) of $20,000,000 or
more, or one or more non-monetary judgments or decrees shall be entered against
Borrower or any of its Subsidiaries that have, or could reasonably be expected
to have, a Material Adverse Effect, and all such judgments or decrees shall not
have been vacated, discharged, stayed or bonded pending appeal within 30 days
from the entry thereof; or
(h) (i) Any Person or "group" (within the meaning of Section 13(d)
or 14(d) of the Securities Exchange Act of 1934, as amended) (A) shall have
acquired beneficial ownership of 30% or more of any outstanding class of Equity
Interests having ordinary voting power in the election of directors of the
Borrower (other than the aggregate beneficial ownership
53
of the Persons who are officers or directors of the Borrower on the Closing Date
or (B) shall obtain the power (whether or not exercised) to elect a majority of
the Borrower's directors or (ii) the Board of Directors of the Borrower shall
not consist of a majority of Continuing Directors; or
(i) Any Loan Document, at any time after its execution and delivery
and for any reason other than the agreement of all the Lenders or satisfaction
in full of all the Obligations, ceases to be in full force and effect, or is
declared by a court of competent jurisdiction to be null and void, invalid or
unenforceable in any respect; or the Borrower denies that it has any or further
liability or obligation under any Loan Document, or purports to revoke,
terminate or rescind any Loan Document;
then, and in any such event, (A) if such event is an Event of Default specified
in paragraph (e) or paragraph (i) above, automatically the Commitments shall
immediately terminate and the Loans hereunder (with accrued interest thereon)
and all other amounts owing under this Agreement and the other Loan Documents
shall immediately become due and payable, as the case may be and (B) if such
event is any other Event of Default, with the consent of the Majority Lenders,
the Administrative Agent may, or upon the request of the Majority Lenders, the
Administrative Agent shall, by notice to the Borrower, declare the Commitments
to be terminated forthwith or the Loans hereunder (with accrued interest
thereon) and all other amounts owing under this Agreement and the other Loan
Documents to be due and payable forthwith, whereupon the same shall immediately
terminate or become due and payable, as the case may be. The Borrower hereby
expressly waives presentment, demand of payment, protest and all notices
whatsoever (other than any notices specifically required hereby).
SECTION 9. THE AGENTS
9.1 Appointment
Each Lender hereby irrevocably designates and appoints the
Administrative Agent as the Administrative Agent of such Lender under this
Agreement and the other Loan Documents, and each Lender irrevocably authorizes
the Administrative Agent, in such capacity, to take such action on its behalf
under the provisions of this Agreement and the other Loan Documents and to
exercise such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, no
Agent shall have any duties or responsibilities, except those expressly set
forth herein, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or any other Loan Document or otherwise exist
against any Agent.
9.2 Delegation of Duties
54
Each Agent may execute any of its duties under this Agreement and
the other Loan Documents by or through agents or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining to such duties.
No Agent shall be responsible for the negligence or misconduct of any agents or
attorneys in-fact selected by it with reasonable care.
9.3 Exculpatory Provisions
No Agent, nor any of such Agent's officers, directors, employees,
agents, attorneys-in-fact or Affiliates, shall be (i) liable for any action
lawfully taken or omitted to be taken by it or such Person under or in
connection with this Agreement or any other Loan Document (except for its or
such Person's own gross negligence or willful misconduct) or (ii) responsible in
any manner to any of the Lenders for any recitals, statements, representations
or warranties made by the Borrower or any officer thereof contained in this
Agreement or any other Loan Document or in any certificate, report, statement or
other document referred to or provided for in, or received by any Agent under or
in connection with, this Agreement or any other Loan Document or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document or for any failure of the Borrower to
perform its obligations hereunder or thereunder. No Agent shall be under any
obligation to any Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement or any other Loan Document, or to inspect the properties, books or
records of the Borrower.
9.4 Reliance by Agents
Each of the Agents shall be entitled to rely, and shall be fully
protected in relying, upon any Note, writing, resolution, notice, consent,
certificate, affidavit, letter, telecopy, telex or teletype message, statement,
order or other document or conversation believed by it to be genuine and correct
and to have been signed, sent or made by the proper Person or Persons and upon
advice and statements of legal counsel (including, without limitation, counsel
to the Borrower), independent accountants and other experts selected by any
Agent. Each of the Agents may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Majority Lenders (or, to the extent
required by this Agreement, all of the Lenders) as it deems appropriate or it
shall first be indemnified to its satisfaction by the Lenders against any and
all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action (other than any such liability or expense
resulting from the gross negligence or willful misconduct of the Administrative
Agent). Each of the Agents shall in all cases be fully protected in acting, or
in refraining from acting, under this Agreement and the other Loan Documents in
accordance with a request of the Majority Lenders (or, to the extent required by
this Agreement, all of the Lenders), and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Lenders and all
future holders of the Loans.
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9.5 Notice of Default
No Agent shall be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default hereunder unless such Agent has
received notice from a Lender or the Borrower referring to this Agreement,
describing such Default or Event of Default and stating that such notice is a
"notice of default". In the event that the Administrative Agent receives such a
notice, the Administrative Agent shall give notice thereof to the Lenders. The
Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Majority Lenders (or, to
the extent required by this Agreement, all of the Lenders); provided that unless
and until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders.
9.6 Non-Reliance on Agents and Other Lenders
Each Lender expressly acknowledges that none of the Agents nor any
of each Agent's respective officers, directors, employees, agents,
attorneys-in-fact or Affiliates has made any representations or warranties to it
and that no act by any Agent hereafter taken, including any review of the
affairs of the Borrower, shall be deemed to constitute any representation or
warranty by such Agent to any Lender. Each Lender represents to each Agent that
it has, independently and without reliance upon any Agent or any other Lender,
and based on such documents and information as it has deemed appropriate, made
its own appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Borrower and made its
own decision to make its Loans hereunder and enter into this Agreement. Each
Lender also represents that it will, independently and without reliance upon any
Agent or any other Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigation as it deems necessary
to inform itself as to the business, operations, property, financial and other
condition and creditworthiness of the Borrower. Except for notices, reports and
other documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, no Agent shall have any duty or responsibility
to provide any Lender with any credit or other information concerning the
business, operations, property, condition (financial or otherwise), prospects or
creditworthiness of the Borrower which may come into the possession of such
Agent or any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates.
9.7 Indemnification
The Lenders agree to indemnify each of the Agents in its capacity as
such (to the extent not reimbursed by the Borrower in accordance with the terms
hereof and without limiting the obligation of the Borrower to do so), ratably
according to their respective Commitment
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Percentages in effect on the date on which indemnification is sought (or, if
indemnification is sought after the date upon which the Commitments shall have
terminated and the Loans shall have been paid in full, ratably in accordance
with such percentages immediately prior to such date), from and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind whatsoever which may at any
time (including, without limitation, at any time following the payment of the
Loans) be imposed on, incurred by or asserted against any such Agent in any way
relating to or arising out of, the Commitments, this Agreement, any of the other
Loan Documents or any documents contemplated by or referred to herein or therein
or the transactions contemplated hereby or thereby or any action taken or
omitted by any such Agent under or in connection with any of the foregoing;
provided that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements which are found by a final and nonappealable
decision of a court of competent jurisdiction to have resulted from any such
Agent's gross negligence or willful misconduct. The agreements in this
subsection shall survive the payment of the Loans and all other amounts payable
hereunder.
9.8 Agents in Their Individual Capacity
Each Person serving as an Agent under this Agreement and such
Person's Affiliates may make loans to, accept deposits from and generally engage
in any kind of business with the Borrower as though the Person serving as an
Agent were not an Agent hereunder and under the other Loan Documents. With
respect to the Loans made by it, the Person serving as an Agent shall have the
same rights and powers under this Agreement and the other Loan Documents as any
Lender and may exercise the same as though it were not an Agent, and the terms
"Lender" and "Lenders" shall include the Person serving as an Agent in its
individual capacity.
9.9 Successor Administrative Agent
The Administrative Agent may resign as Administrative Agent upon 10
days' notice to the Lenders and the Borrower. If the Administrative Agent shall
resign as Administrative Agent under this Agreement and the other Loan
Documents, then the Majority Lenders shall appoint from among the Lenders a
successor Administrative Agent for the Lenders, which successor Administrative
Agent (provided that it shall have been approved by the Borrower), shall succeed
to the rights, powers and duties of the Administrative Agent hereunder.
Effective upon such appointment and approval, the term "Administrative Agent"
shall mean such successor Administrative Agent, and the former Administrative
Agent's rights, powers and duties as Administrative Agent shall be terminated,
without any other or further act or deed on the part of such former
Administrative Agent or any of the parties to this Agreement or any holders of
the Loans. After any retiring Administrative Agent's resignation as
Administrative Agent, the provisions of this Section 9 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement and the other Loan Documents.
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SECTION 10. MISCELLANEOUS
10.1 Amendments and Waivers
Neither this Agreement nor any other Loan Document, nor any terms
hereof or thereof, may be amended, supplemented or modified except in accordance
with the provisions of this subsection. The Majority Lenders may, or, with the
written consent of the Majority Lenders, the Administrative Agent may, from time
to time, (a) enter into with the Borrower written amendments, supplements or
modifications hereto and to the other Loan Documents for the purpose of adding
any provisions to this Agreement or the other Loan Documents or changing in any
manner the rights of the Lenders or of the Borrower hereunder or thereunder or
(b) waive, on such terms and conditions as the Majority Lenders or the
Administrative Agent, as the case may be, may specify in such instrument, any of
the requirements of this Agreement or the other Loan Documents or any Default or
Event of Default and its consequences; provided, however, that no such waiver
and no such amendment, supplement or modification shall (i) reduce the amount or
extend the scheduled date of maturity of any Loan, or reduce the stated rate or
amount of any interest or fee payable hereunder or extend the scheduled date of
any payment thereof or increase the amount or extend the expiration date of the
Commitments without the consent of each Lender affected thereby, or (ii) amend,
modify or waive any provision of this subsection, reduce the percentage
specified in the definitions of Majority Leaders, or amend or modify any other
provision hereof specifying the number or percentage of Lenders required to
waive, amend or modify any rights hereunder or make any determination granting
consent hereunder, or consent to the assignment or transfer by the Borrower or
any Guarantor of any of its rights and obligations under this Agreement and the
other Loan Documents, in each case without the written consent of all the
Lenders, (iii) release any Guarantor from its obligations or limit any of such
Guarantor's obligations under Section 11 (except where such release is expressly
permitted elsewhere in this Agreement without such consent) without the written
consent of all the Lenders, or (iv) amend, modify or waive any provision of
Section 9 without the written consent of each Agent directly affected thereby;
and further provided, however, that no such waiver and no such amendment,
supplement or modification shall amend, modify or waive any provision of Section
11 without the written consent of the Guarantors. Any such waiver and any such
amendment, supplement or modification shall apply equally to each of the Lenders
and shall be binding upon the Borrower, the Guarantors, the Lenders, the Agents
and all future holders of the Loans. In the case of any waiver, the Borrower,
the Guarantors, the Lenders and the Agents shall be restored to their former
positions and rights hereunder and under the other Loan Documents, and any
Default or Event of Default waived shall be deemed to be cured and not
continuing; no such waiver shall extend to any subsequent or other Default or
Event of Default or impair any right consequent thereon.
10.2 Notices
(a) Except in the case of notices and other communications expressly
permitted to be given by telephone (and subject to paragraph (b) below), all
notices and other
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communications provided for herein shall be in writing and shall be delivered by
hand or overnight courier service, mailed by certified or registered mail or
sent by telecopy, as follows:
(i) if to the Borrower or any of the Guarantors, to Henry
Schein, Inc., 135 Duryea Road, Melville, New York, 11747, Attention
of Chief Financial Officer (Telecopy No. (631) 843-5541), with a
copy to Proskauer Rose LLP, 1585 Broadway, New York, New York,
10036-8299, Attention of Jack P. Jackson, Esq. (Telecopy No. (212)
969-2900);
(ii) if to the Administrative Agent, to it at JPMorgan Chase
Bank, 395 North Service Road, Suite 302, Melville, NY 11747,
Attention of John Budzynski, (Telecopy No. (631) 755-5184), with a
copy to Richard Grabowski;
(iii) if to any other Lender, to it at its address (or
telecopy number) set forth in its Administrative Questionnaire and
notified to the Borrower in accordance with the provisions hereof.
(b) Notices and other communications to the Lenders hereunder may be
delivered or furnished by electronic communications pursuant to procedures
approved by the Administrative Agent and the Lenders. The Administrative Agent
or the Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it; provided that approval of such procedures may be
limited to particular notices or communications.
(c) Any party hereto may change its address or telecopy number for
notices and other communications hereunder by notice to the other parties
hereto. All notices and other communications given to any party hereto in
accordance with the provisions of this Agreement shall be deemed to have been
given on the date of receipt.
10.3 No Waiver; Cumulative Remedies
No failure to exercise and no delay in exercising, on the part of
any Agent or any Lender, any right, remedy, power or privilege hereunder or
under the other Loan Documents shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege. The rights, remedies, powers and privileges
herein provided are cumulative and not exclusive of any rights, remedies, powers
and privileges provided by law.
10.4 Survival of Representations and Warranties
All representations and warranties made hereunder, in the other Loan
Documents and in any document, certificate or statement delivered pursuant
hereto or in connection herewith shall survive the execution and delivery of
this Agreement and the making of the Loans hereunder.
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10.5 Payment of Expenses and Taxes
The Borrower agrees (a) to pay or reimburse each of the Agents for
all their reasonable out-of-pocket costs and expenses incurred in connection
with the development, preparation and execution of, and any amendment,
supplement or modification to, this Agreement and the other Loan Documents and
any other documents prepared in connection herewith or therewith, and the
consummation and administration of the transactions contemplated hereby and
thereby, including, without limitation, the reasonable fees and disbursements of
Simpson Thacher & Bartlett LLP, counsel to the Administrative Agent, (b) to pay
or reimburse each Lender and each Agent for all its costs and expenses incurred
in connection with the enforcement of any rights under this Agreement or any of
the other Loan Documents, including, without limitation, the Attorney Costs of
each Lender and each Agent, (c) to pay, and indemnify and hold harmless each
Lender and each Agent and each of their affiliates and their respective
officers, directors, employees, agents and advisors (each, an "indemnified
party") from, any and all recording and filing fees and any and all liabilities
with respect to, or resulting from any delay in paying, stamp, excise and other
taxes, if any, which may be payable or determined to be payable in connection
with the execution and delivery of, or consummation or administration of any of
the transactions contemplated by, or any amendment, supplement or modification
of, or any waiver or consent under or in respect of, this Agreement, the other
Loan Documents and any such other documents, provided that the Borrower shall
have no obligation hereunder to any indemnified party with respect to any of the
foregoing fees or liabilities which arise from the gross negligence or willful
misconduct of such indemnified party determined in a court of competent
jurisdiction in a final non-appealable judgment, and (d) to pay, and indemnify
and hold harmless each indemnified party from and against, any and all other
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever with respect
to the execution, delivery, enforcement, performance and administration of this
Agreement, the other Loan Documents including, without limitation, any of the
foregoing relating to the violation of, noncompliance with, or liability under,
any Environmental Law applicable to the operations of the Borrower, any of its
Subsidiaries or any of the Properties (all the foregoing in this clause (d),
collectively, the "indemnified liabilities"), provided that the Borrower shall
have no obligation hereunder to any indemnified party with respect to
indemnified liabilities arising from the gross negligence or willful misconduct
of such indemnified party determined in a court of competent jurisdiction in a
final non-appealable judgment. The agreements in this subsection shall survive
the termination of this Agreement and each other Loan Document and repayment of
the Loans and all other amounts payable hereunder.
10.6 Successors and Assigns; Participations and Assignments
(a) The provisions of this Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that (i) neither the Borrower nor any of the Guarantors
may assign or otherwise transfer any of their respective rights or obligations
hereunder without the prior written consent of each Lender
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(and any attempted assignment or transfer by any such Person without such
consent shall be null and void) and (ii) no Lender may assign or otherwise
transfer its rights or obligations hereunder except in accordance with this
subsection. Nothing in this Agreement, expressed or implied, shall be construed
to confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby, Participants (to the extent provided in
paragraph (c) of this subsection) and, to the extent expressly contemplated
hereby, the Related Parties of each of the Agents and the Lenders) any legal or
equitable right, remedy or claim under or by reason of this Agreement.
(b) (i) Subject to the conditions set forth in paragraph (b)(ii)
below, any Lender may assign to one or more assignees (each, an "Assignee") all
or a portion of its rights and obligations under this Agreement (including all
or a portion of its Commitment or the Loans at the time owing to it, as the case
may be) with the prior written consent (such consent not to be unreasonably
withheld) of:
(A) the Borrower, provided that no consent of the
Borrower shall be required for an assignment to a
Lender, an Affiliate of a Lender, an "Approved
Fund" (as defined below) or, if a Default or an
Event of Default has occurred and is continuing,
any other Assignee; and
(B) the Administrative Agent.
(ii) Assignments shall be subject to the following additional
conditions:
(A) except in the case of an assignment to a Lender or
an Affiliate of a Lender or an assignment of the
entire remaining amount of the assigning Lender's
Commitments or Loans, as the case may be, the
amount of the Commitments or Loans, as the case
may be, of the assigning Lender subject to each
such assignment (determined as of the date the
Assignment and Acceptance, substantially in the
form of Exhibit F (hereinafter, an "Assignment and
Acceptance"), with respect to such assignment is
delivered to the Administrative Agent) shall not
be less than $5,000,000 unless each of the
Borrower and the Administrative Agent otherwise
consent, provided that no such consent of the
Borrower shall be required if a Default or an
Event of Default has occurred and is continuing;
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(B) each partial assignment shall be made as an
assignment of a proportionate part of all the
assigning Lender's rights and obligations under
this Agreement:
(C) the parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment
and Acceptance, together with a processing and
recordation fee of $3,500;
(D) the Assignee, if it shall not be a Lender, shall
deliver to the Administrative Agent a duly
completed administrative questionnaire (containing
all pertinent information relating to such
assignee; hereinafter an "Administrative
Questionnaire"); and
(E) in the case of an assignment to a "CLO" (as
defined below), the assigning Lender shall retain
the sole right to approve any amendment,
modification or waiver of any provision of this
Agreement, provided that the Assignment and
Acceptance between such Lender and such CLO may
provide that such Lender will not, without the
consent of such CLO, agree to any amendment,
modification or waiver described in the first
proviso to subsection 10.1(a) that affects such
CLO.
For the purposes of this subsection 10.6(b), the terms "Approved
Fund" and "CLO" have the following meanings:
"Approved Fund" means (a) a CLO and (b) with respect to any Lender
that is an institutional fund which invests primarily in bank loans and similar
extensions of credit, any other institutional fund that invests primarily in
bank loans and similar extensions of credit and is managed by the same
investment advisor as such Lender or by an Affiliate of such investment advisor.
"CLO" means any entity (whether a corporation, partnership, trust or
otherwise) that is engaged in making, purchasing, holding or otherwise investing
in bank loans and similar extensions of credit in the ordinary course of its
business and is administered or managed by a Lender or an Affiliate of such
Lender.
(iii) Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) of this subsection, from and after the effective
date specified in each Assignment and Acceptance the assignee
thereunder shall be a party hereto and, to the extent of the
interest assigned by such Assignment and Acceptance, have the rights
and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by
such
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Assignment and Acceptance, be released from its obligations under
this Agreement (and, in the case of an Assignment and Acceptance
covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but
shall continue to be entitled to the benefits of subsections 3.8,
3.9, 3.10, 3.11 and 10.5). Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with
this subsection 10.6 shall be treated for purposes of this Agreement
as a sale by such Lender of a participation in such rights and
obligations in accordance with paragraph (c) of this subsection.
(iv) The Administrative Agent, acting for this purpose as an
agent of the Borrower, shall maintain at one of its offices a copy
of each Assignment and Acceptance delivered to it and a register for
the recordation of the names and addresses of the Lenders, and the
principal amount of the Loans owing to, each Lender pursuant to the
terms hereof from time to time (the "Register"). The entries in the
Register shall be conclusive in the absence of manifest error, and
the Borrower, the Administrative Agent and the Lenders may treat
each Person whose name is recorded in the Register pursuant to the
terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary. The Register
shall be available for inspection by the Borrower and any Lender, at
any reasonable time and from time to time upon reasonable prior
notice.
(v) Upon its receipt of a duly completed Assignment and
Acceptance executed by an assigning Lender and an Assignee, the
Assignee's completed Administrative Questionnaire (unless the
Assignee shall already be a Lender hereunder), the processing and
recordation fee referred to in paragraph (b) of this subsection and
any written consent to such assignment required by paragraph (b) of
this subsection, the Administrative Agent shall accept such
Assignment and Acceptance and record the information contained
therein in the Register. No assignment shall be effective for
purposes of this Agreement unless it has been recorded in the
Register as provided in this paragraph.
(c) (i) Any Lender may, without the consent of the Borrower or the
Administrative Agent, sell participations to one or more banks or other entities
(a "Participant") in all or a portion of such Lender's rights and obligations
under this Agreement (including all or a portion of its Commitment or Loan owing
to it, as the case may be); provided that (A) such Lender's obligations under
this Agreement shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (C) the Borrower, the Agents and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
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agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver
described in the first proviso to subsection 10.1(a) that affects such
Participant. Subject to paragraph (c)(ii) of this subsection, the Borrower
agrees that each Participant shall be entitled to the benefits of subsections
3.8, 3.9, 3.10 and 3.11 to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to paragraph (b) of this
subsection. To the extent permitted by law, each Participant also shall be
entitled to the benefits of subsection 10.7 as though it were a Lender, provided
such Participant agrees to be subject to subsection 10.7 as though it were a
Lender.
(ii) A Participant shall not be entitled to receive any
greater payment under subsection 3.9, 3.10 or 3.11 than the applicable Lender
would have been entitled to receive with respect to the participation sold to
such Participant, unless the sale of the participation to such Participant is
made with the Borrower's prior written consent. A Participant that would be a
Non-U.S. Lender (as defined in subsection 3.10(b)) if it were a Lender shall not
be entitled to the benefits of subsection 3.10 unless the Borrower is notified
of the participation sold to such Participant and such Participant agrees, for
the benefit of the Borrower, to comply with subsection 3.10(b) as though it were
a Lender.
(d) Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement to secure obligations
of such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this subsection shall not apply to any such pledge or
assignment of a security interest; provided that no such pledge or assignment of
a security interest shall release a Lender from any of its obligations hereunder
or substitute any such pledgee or assignee for such Lender as a party hereto.
(e) The Borrower authorizes each Lender to disclose to any
Participant or Assignee (each, a "Transferee") and any prospective Transferee,
subject to the provisions of subsection 10.14, any and all financial information
in such Lender's possession concerning the Borrower and its Subsidiaries and
Affiliates which has been delivered to such Lender by or on behalf of the
Borrower pursuant to this Agreement or which has been delivered to such Lender
by or on behalf of the Borrower in connection with such Lender's credit
evaluation of such Borrower and its Subsidiaries and Affiliates prior to
becoming a party to this Agreement.
(f) For avoidance of doubt, the parties to this Agreement
acknowledge that the provisions of this subsection concerning assignments of
Loans and Notes relate only to absolute assignments and that such provisions do
not prohibit assignments creating security interests, including, without
limitation, any pledge or assignment by a Lender of any Loan or Note to any
Federal Reserve Bank in accordance with applicable law.
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10.7 Adjustments; Set-off
(a) If any Lender (a "benefited Lender") shall at any time receive
any payment of all or part of its Loans, or interest thereon, or receive any
collateral in respect thereof (whether voluntarily or involuntarily, by set-off,
pursuant to events or proceedings of the nature referred to in subsection 8(e),
or otherwise), in a greater proportion than any such payment to or collateral
received by any other Lender (other than to the extent expressly provided
herein), if any, in respect of such other Lender's Loans, or interest thereon,
such benefited Lender shall purchase for cash from the other Lenders a
participating interest in such portion of each such other Lender's Loans, or
shall provide such other Lenders with the benefits of any such collateral, or
the proceeds thereof, as shall be necessary to cause such benefited Lender to
share the excess payment or benefits of such collateral or proceeds ratably with
each of the other Lenders; provided, however, that if all or any portion of such
excess payment or benefits is thereafter recovered from such benefited Lender,
such purchase shall be rescinded, and the purchase price and benefits returned,
to the extent of such recovery, but without interest.
(b) In addition to any rights and remedies of the Lenders provided
by law, each Lender shall have the right, without prior notice to the Borrower
or the Guarantors, any such notice being expressly waived by the Borrower and
the Guarantors to the extent permitted by applicable law, upon any amount
becoming due and payable by the Borrower hereunder (whether at the stated
maturity, by acceleration or otherwise) to set off and appropriate and apply
against such amount any and all deposits (general or special, time or demand,
provisional or final), in any currency, and any other credits, indebtedness or
claims, in any currency, in each case whether direct or indirect, absolute or
contingent, matured or unmatured, at any time held or owing by such Lender or
any branch or agency thereof to or for the credit or the account of the Borrower
or any of the Guarantors. Each Lender agrees promptly to notify the Borrower or
any such Guarantor and the Administrative Agent after any such set-off and
application made by such Lender, provided that the failure to give such notice
shall not affect the validity of such set-off and application.
10.8 Counterparts
This Agreement may be executed by one or more of the parties to this
Agreement on any number of separate counterparts (including by facsimile
transmission), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. A set of the copies of this Agreement
signed by all the parties shall be lodged with the Borrower and the
Administrative Agent.
10.9 Severability
Any provision of this Agreement which is prohibited or unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition
65
or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
10.10 Integration
This Agreement and the other Loan Documents represent the entire
agreement of the Borrower, the Agents and the Lenders with respect to the
subject matter hereof or thereof, and there are no promises, undertakings,
representations or warranties by any Agent or any Lender relative to subject
matter hereof or thereof not expressly set forth or referred to herein or in the
other Loan Documents.
10.11 GOVERNING LAW
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK.
10.12 Submission To Jurisdiction; Waivers
Each of the Borrower and each Guarantor hereby irrevocably and
unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the courts of the State of
New York, the courts of the United States of America for the Southern District
of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to the
venue of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage prepaid, to the Borrower at its
address set forth in subsection 10.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the right
to sue in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right
it may have to claim or recover in any legal action or proceeding referred to in
this subsection any special, exemplary, punitive or consequential damages.
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10.13 Acknowledgements
Each of the Borrower and each Guarantor hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;
(b) no Agent nor any Lender has any fiduciary relationship with or
duty to the Borrower or any of the Guarantors arising out of or in connection
with this Agreement or any of the other Loan Documents, and the relationship
between the Agents and Lenders, on the one hand, and the Borrower and the
Guarantors, on the other hand, in connection herewith or therewith is solely
that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions contemplated hereby
among the Lenders or among the Borrower, the Guarantors, and the Lenders.
10.14 Confidentiality
Each Lender agrees to keep confidential any written or oral
information (a) provided to it by or on behalf of the Borrower or any of its
Subsidiaries pursuant to or in connection with this Agreement or any other Loan
Document or (b) obtained by such Lender based on a review of the books and
records of the Borrower or any of its Subsidiaries; provided that nothing herein
shall prevent any Lender from disclosing any such information (i) to any Agent
or any other Lender, (ii) to any Transferee which receives such information
having been made aware of the confidential nature thereof and having agreed to
abide by the provisions of this subsection 10.14, (iii) to its employees,
directors, agents, attorneys, accountants and other professional advisors, and
to employees and officers of its Affiliates who agree to be bound by the
provisions of this subsection 10.14 and who have a need for such information in
connection with this Agreement or other transactions or proposed transactions
with the Borrower, (iv) upon the request or demand of any Governmental Authority
having jurisdiction over such Lender, (v) in response to any order of any court
or other Governmental Authority or as may otherwise be required pursuant to any
Requirement of Law, (vi) subject to an agreement to comply with the provisions
of this subsection, to any actual or prospective counter-party (or its advisors)
to any Swap Agreement, (vii) which has been publicly disclosed other than in
breach of this Agreement, (viii) in connection with the exercise of any remedy
hereunder or any litigation to which such Lender is a party, or (ix) which is
received by such Lender from a Person who, to such Lender's knowledge or
reasonable belief, is not under a duty of confidentiality to the Borrower or the
applicable Subsidiary, as the case may be.
10.15 WAIVERS OF JURY TRIAL
THE BORROWER, THE GUARANTORS, THE AGENTS AND THE LENDERS HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY
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JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
SECTION 11. GUARANTEE
11.1 Guarantee
The Guarantors hereby jointly and severally guarantee (this
"Guarantee") to each Lender and each Agent, and their respective successors and
assigns, the prompt payment in full when due (whether at stated maturity, by
acceleration or otherwise) of the principal of and interest on the Loans made by
the Lenders to the Borrower and all other amounts owing to the Lenders or the
Agents by the Borrower under this Agreement or under any of the other Loan
Documents, in each case strictly in accordance with the terms hereof or thereof,
as the case may be (such obligations being herein collectively called the
"Guaranteed Obligations"). The Guarantors hereby further jointly and severally
agree that if the Borrower shall fail to pay in full when due (whether at stated
maturity, by acceleration or otherwise) any of the Guaranteed Obligations, the
Guarantors will promptly pay the same, without any demand or notice whatsoever,
and that in the case of any extension of time of payment or renewal of any of
the Guaranteed Obligations, the same will be promptly paid in full when due
(whether at extended maturity, by acceleration or otherwise) in accordance with
the terms of such extension or renewal. This Guarantee is an absolute,
unconditional, continuing guaranty of payment and not of collection of the
Guaranteed Obligations and includes Guaranteed Obligations arising from
successive transactions which shall either continue such Guaranteed Obligations
or from time to time renew such Guaranteed Obligations after the same have been
satisfied. This Guarantee is in no way conditioned upon any attempt to collect
from the Borrower or upon any other event or contingency, and shall be binding
upon and enforceable against each Guarantor without regard to the validity or
enforceability of any of the Guaranteed Obligations, this Agreement, the Notes
or any other Loan Document or of any term hereof or thereof. Each Lender and
each Agent, is hereby authorized at any time and from time to time, to the
fullest extent permitted by law, to set off and 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 Lender or such Agent to or for the
credit or the account of any Guarantor against any of the obligations of any
Guarantor now or hereafter existing under this Guarantee, irrespective of
whether or not any such Lender or such Agent shall have made any demand
hereunder and although such obligations may be unmatured. The rights under this
subsection 11.1 are in addition to other rights and remedies (including other
rights of set off) which any Lender or any Agent may have.
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11.2 Obligations Unconditional
The obligations of the Guarantors under subsection 11.1 are absolute
and unconditional, joint and several, irrespective of the value, genuineness,
validity, regularity or enforceability of the obligations of the Borrower under
this Agreement or any other agreement or instrument referred to herein, or any
substitution, release or exchange of any other guarantee of or security for any
of the Guaranteed Obligations, and, to the fullest extent permitted by
applicable law, irrespective of any other circumstance whatsoever that might
otherwise constitute a legal or equitable discharge or defense of a surety or
guarantor, it being the intent of this subsection that the obligations of the
Guarantors hereunder shall be absolute and unconditional, joint and several, and
shall not be subject to any counterclaim, set-off, deduction or defense based
upon any claim any Guarantor may have against any Person, under any and all
circumstances. Without limiting the generality of the foregoing, it is agreed
that the occurrence of any one or more of the following shall not alter or
impair the liability of the Guarantors hereunder, which shall remain absolute
and unconditional as described above:
(i) at any time or from time to time, without notice to the
Guarantors, the time for any performance of or compliance with any of the
Guaranteed Obligations shall be extended, or such performance or
compliance shall be waived;
(ii) any of the acts mentioned in any of the provisions of this
Agreement or any other agreement or instrument referred to herein shall be
done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall be
accelerated, or any of the Guaranteed Obligations shall be modified,
supplemented or amended in any respect, or any right under this Agreement
or any other agreement or instrument referred to herein shall be waived or
any other guarantee of any of the Guaranteed Obligations or any security
therefor shall be released or exchanged in whole or in part or otherwise
dealt with;
(iv) any lien or security interest granted to, or in favor of, any
Agent or Agents or any Lender or Lenders as security for any of the
Guaranteed Obligations shall fail to be perfected or shall be impaired or
shall be released, or any Person liable for any of the Guaranteed
Obligations (including, without limitation, any Guarantor) shall be
released;
(v) any express or implied amendment, modification or supplement to
this Agreement, any Note, or any other instrument applicable to the
Borrower or to the Loans;
(vi) any failure on the part of the Borrower to perform or comply
with this Agreement, any Note or any other Loan Document or any failure of
any other Person to perform or comply with any term of this Agreement, any
Note, or any other Loan Document or any other agreement as aforesaid; or
69
(vii) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or similar proceeding with respect
to the Borrower, or its properties or its creditors, or any action taken
by any trustee or receiver or by any court in any such proceeding.
The Guarantors hereby expressly waive diligence, presentment, demand of payment,
protest and all notices whatsoever, and any requirement that any Agent or any
Lender exhaust any right, power or remedy or proceed against the Borrower under
this Agreement or any other agreement or instrument referred to herein, or
against any other Person under any other guarantee of, or security for, any of
the Guaranteed Obligations.
11.3 Reinstatement
The obligations of the Guarantors under this Section shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of the Borrower or any Guarantor in respect of the Guaranteed
Obligations is rescinded or must be otherwise restored by any holder of any of
the Guaranteed Obligations, whether as a result of any proceedings in bankruptcy
or reorganization or otherwise, and the Guarantors jointly and severally agree
that they will indemnify the Agents and each Lender on demand for all reasonable
costs and expenses (including fees of counsel) incurred by such Agent or such
Lender in connection with such rescission or restoration, including any such
costs and expenses incurred in defending against any claim alleging that such
payment constituted a preference, fraudulent transfer or similar payment under
any bankruptcy, insolvency or similar law.
11.4 Subrogation
The Guarantors hereby jointly and severally agree that until the
payment and satisfaction in full of all Guaranteed Obligations, the Guarantors
shall not exercise any right or remedy arising by reason of any performance by
them of their guarantee in subsection 11.1, whether by subrogation or otherwise,
against the Borrower or any other guarantor of any of the Guaranteed Obligations
or any security for any of the Guaranteed Obligations.
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11.5 Remedies
The Guarantors jointly and severally agree that, as between the
Guarantors and the Lenders, the obligations of the Borrower under this Agreement
may be declared to be forthwith due and payable as provided in Section 8 (and
shall be deemed to have become automatically due and payable as a result of the
occurrence of an event described in clause (e) or (i) of Section 8 in accordance
with the provisions of Section 8) for purposes of subsection 11.1
notwithstanding any stay, injunction or other prohibition preventing such
declaration (or such obligations from becoming automatically due and payable) as
against the Borrower , the obligations of the Guarantors with respect to the
Guaranteed Obligations shall be unaffected by any such stay, injunction or other
prohibition preventing such declaration (or such obligations from becoming
automatically due and payable) as against the Borrower or otherwise, and that,
in the event of such declaration (or such obligations being deemed to have
become automatically due and payable), such obligations (whether or not due and
payable by the Borrower) shall forthwith become due and payable by the
Guarantors for purposes of subsection 11.1.
11.6 Instrument for the Payment of Money
Each Guarantor hereby acknowledges that the guarantee in this
Section constitutes an instrument for the payment of money, and consents and
agrees that any Lender or any Agent, at its sole option, in the event of a
dispute by such Guarantor in the payment of any moneys due hereunder, shall have
the right to bring motion or action under New York CPLR Section 3213.
11.7 Continuing Guarantee
The guarantee in this Section is a continuing guarantee, and shall
apply to all Guaranteed Obligations whenever arising.
11.8 General Limitation on Guarantee Obligations
In any action or proceeding involving any state corporate law, or
any state or Federal bankruptcy, insolvency, reorganization or other law
affecting the rights of creditors generally, if the obligations of any
Guarantors under subsection 11.1 would otherwise be held or determined to be
void, invalid or unenforceable, or subordinated to the claims of any other
creditors, on account of the amount of its liability under subsection 11.1,
then, notwithstanding any other provision hereof to the contrary, the amount of
such liability shall, without any further action by such Guarantors, any Lender,
any Agent or any other Person, be automatically limited and reduced to the
highest amount that is valid and enforceable and not subordinated to the claims
of other creditors as determined in such action or proceeding.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
HENRY SCHEIN, INC.,
as Borrower
By: /s/ Steven Paladino
-------------------------------
Name: Steven Paladino
Title:
ROANE BARKER, INC.,
as a Guarantor
By: /s/ Steven Paladino
-------------------------------
Name: Steven Paladino
Title:
DENTRIX DENTAL SYSTEMS, INC.
as a Guarantor
By: /s/ Steven Paladino
-------------------------------
Name: Steven Paladino
Title:
HSI SERVICE CORP.
as a Guarantor
By: /s/ Steven Paladino
-------------------------------
Name: Steven Paladino
Title:
MICRO BIO-MEDICS, INC.
as a Guarantor
By: /s/ Steven Paladino
-----------------------------------
Name: Steven Paladino
Title:
GIV HOLDINGS, INC.
as a Guarantor
By: /s/ Steven Paladino
-----------------------------------
Name: Steven Paladino
Title:
JPMORGAN CHASE BANK,
as Administrative Agent and as a Lender
By: /s/ John Budzynski
-----------------------------------
Name: John Budzynski
Title: Vice President
LEHMAN COMMERCIAL PAPER INC.,
as Syndication Agent and as a Lender
By: /s/ Gregory H. Smith
-----------------------------------
Name: Gregory H. Smith
Title:
Schedule 1.1
Names and Commitments of Lenders
Name of Lender Commitment
- --------------------------- ------------
JPMORGAN CHASE BANK $75,000,000
LEHMAN COMMERCIAL PAPER INC. $75,000,000
Schedule 4.8
Taxation
None
Schedule 7.7
Swap Agreements
Entity: Sirona Dental Systems B.V.
Principal: EUR6million
Bank Pays: Floating
Bank Receives: Fixed - 4.2%