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EXHIBIT 4.3
CONFORMED COPY
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CREDIT AGREEMENT
dated as of
May 7, 1999
among
AMERICAN MEDIA, INC.,
AMERICAN MEDIA OPERATIONS, INC.,
The Lenders Party Hereto
and
THE CHASE MANHATTAN BANK,
as Administrative Agent
---------------------------
CHASE SECURITIES INC.,
as Arranger
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[CSM Ref. No. 6700-719]
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TABLE OF CONTENTS
PAGE
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ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms.......................................... 1
SECTION 1.02. Classification of Loans and Borrowings................. 31
SECTION 1.03. Terms Generally........................................ 31
SECTION 1.04. Accounting Terms; GAAP; Treatment
of Unrestricted Subsidiaries.......................... 32
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments............................................ 33
SECTION 2.02. Loans and Borrowings................................... 33
SECTION 2.03. Requests for Borrowings................................ 34
SECTION 2.04. Swingline Loans........................................ 35
SECTION 2.05. Letters of Credit...................................... 37
SECTION 2.06. Funding of Borrowings ................................. 42
SECTION 2.07. Interest Elections .................................... 43
SECTION 2.08. Termination and Reduction of Commitments .............. 45
SECTION 2.09. Repayment of Loans; Evidence of Debt .................. 45
SECTION 2.10. Amortization of Term Loans ............................ 46
SECTION 2.11. Prepayment of Loans ................................... 48
SECTION 2.12. Fees .................................................. 51
SECTION 2.13. Interest .............................................. 52
SECTION 2.14. Alternate Rate of Interest ............................ 53
SECTION 2.15. Increased Costs ....................................... 54
SECTION 2.16. Break Funding Payments ................................ 55
SECTION 2.17. Taxes ................................................. 56
SECTION 2.18. Payments Generally; Pro Rata Treatment;
Sharing of Setoffs .................................. 58
SECTION 2.19. Mitigation Obligations; Replacement of Lenders ........ 60
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.01. Organization; Powers .................................. 61
SECTION 3.02. Authorization; Enforceability ......................... 61
SECTION 3.03. Governmental Approvals; No Conflicts .................. 62
SECTION 3.04. Financial Condition; No Material Adverse Change....... 62
SECTION 3.05. Properties ............................................ 63
SECTION 3.06. Litigation and Environmental Matters................... 64
SECTION 3.07. Compliance with Laws and Agreements ................... 64
SECTION 3.08. Investment and Holding Company Status ................. 65
SECTION 3.09. Taxes ................................................. 65
SECTION 3.10. ERISA ................................................. 65
SECTION 3.11. Disclosure ............................................ 65
SECTION 3.12. Subsidiaries .......................................... 66
SECTION 3.13. Insurance ............................................. 66
SECTION 3.14. Labor Matters ......................................... 66
SECTION 3.15. Solvency .............................................. 67
SECTION 3.16. Senior Indebtedness ................................... 67
SECTION 3.17. Year 2000 ............................................. 67
SECTION 3.18. Security Documents .................................... 67
SECTION 3.19. Merger ................................................ 69
SECTION 3.20. Capitalization of Holdings ............................ 69
ARTICLE IV
CONDITIONS
SECTION 4.01. Effective Date ........................................ 69
SECTION 4.02. Each Credit Event ..................................... 74
ARTICLE V
AFFIRMATIVE COVENANTS
SECTION 5.01. Financial Statements and Other Information ............ 75
SECTION 5.02. Notices of Material Events ............................ 77
SECTION 5.03. Information Regarding Collateral ...................... 78
SECTION 5.04. Existence; Conduct of Business ........................ 78
SECTION 5.05. Payment of Obligations ................................ 79
SECTION 5.06. Maintenance of Properties ............................. 79
SECTION 5.07. Insurance ............................................. 79
SECTION 5.08. Casualty and Condemnation ............................. 79
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SECTION 5.09. Books and Records; Inspection and
Audit Rights ........................................ 80
SECTION 5.10. Compliance with Laws .................................. 80
SECTION 5.11. Use of Proceeds and Letters of Credit ................. 80
SECTION 5.12. Additional Subsidiaries ............................... 80
SECTION 5.13 Further Assurances .................................... 81
SECTION 5.14. Interest Rate Protection .............................. 82
SECTION 5.15. Redemption of Existing Notes .......................... 82
ARTICLE VI
NEGATIVE COVENANTS
SECTION 6.01. Indebtedness; Certain Equity Securities ............... 82
SECTION 6.02. Liens ................................................. 84
SECTION 6.03. Fundamental Changes ................................... 85
SECTION 6.04. Investments, Loans, Advances,
Guarantees and Acquisitions .......................... 87
SECTION 6.05 Asset Sales ........................................... 90
SECTION 6.06. Sale and Leaseback Transactions ....................... 90
SECTION 6.07. Hedging Agreements .................................... 91
SECTION 6.08. Restricted Payments; Certain Payments
of Indebtedness ...................................... 91
SECTION 6.09. Transactions with Affiliates .......................... 93
SECTION 6.10. Restrictive Agreements ................................ 93
SECTION 6.11. Amendment of Material Documents ....................... 94
SECTION 6.12. Leverage Ratio ........................................ 94
SECTION 6.13. Senior Leverage Ratio ................................. 95
SECTION 6.14. Consolidated Interest Expense Coverage Ratio .......... 95
SECTION 6.15. Consolidated Fixed Charge Coverage Ratio .............. 96
SECTION 6.16. Capital Expenditures .................................. 97
ARTICLE VII
EVENTS OF DEFAULT ..................................... 97
ARTICLE VIII
THE AGENTS ............................................ 101
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices ............................................... 103
SECTION 9.02. Waivers; Amendments ................................... 104
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SECTION 9.03. Expenses; Indemnity; Damage Waiver .................... 106
SECTION 9.04. Successors and Assigns ................................ 108
SECTION 9.05. Survival .............................................. 111
SECTION 9.06. Counterparts; Integration; Effectiveness .............. 112
SECTION 9.07. Severability .......................................... 112
SECTION 9.08. Right of Setoff ....................................... 112
SECTION 9.09. Governing Law; Jurisdiction; Consent to
Service of Process .................................. 113
SECTION 9.10. WAIVER OF JURY TRIAL .................................. 114
SECTION 9.11. Headings .............................................. 114
SECTION 9.12. Confidentiality ....................................... 114
SECTION 9.13. Interest Rate Limitation .............................. 114
SCHEDULES:
Schedule 1.01(a) -- Mortgaged Property
Schedule 2.01 -- Commitments
Schedule 3.05(b) -- Intellectual Property
Schedule 3.05(c) -- Real Property
Schedule 3.06 -- Disclosed Matters
Schedule 3.12 -- Subsidiaries
Schedule 3.13 -- Insurance
Schedule 3.18(d) -- Mortgaged Property Filing Offices
Schedule 6.01 -- Existing Indebtedness
Schedule 6.02 -- Existing Liens
Schedule 6.04 -- Investments
Schedule 6.10 -- Existing Restrictions
EXHIBITS:
Exhibit A -- Form of Assignment and Acceptance
Exhibit B-1 -- Form of Opinion of Borrower's Counsel
Exhibit B-2 -- Form of Opinion of Local Counsel
Exhibit C -- Form of Guarantee Agreement
Exhibit D -- Form of Indemnity, Subrogation and Contribution Agreement
Exhibit E -- Form of Pledge Agreement
Exhibit F -- Form of Security Agreement
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CREDIT AGREEMENT dated as of May 7, 1999,
among AMERICAN MEDIA INC., AMERICAN MEDIA
OPERATIONS, INC., the LENDERS party hereto, and THE
CHASE MANHATTAN BANK, as Administrative Agent.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. DEFINED TERMS. As used in this Agreement, the
following terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are
bearing interest at a rate determined by reference to the Alternate Base Rate.
"ACQUISITION" means the Merger and the other transactions
contemplated by the Merger Agreement and the other Acquisition Documents.
"ACQUISITION DOCUMENTS" means the Merger Agreement and the
LLC Agreement.
"ADJUSTED LIBO RATE" means, with respect to any Eurodollar
Borrowing for any Interest Period, an interest rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such
Interest Period multiplied by (b) the Statutory Reserve Rate.
"ADMINISTRATIVE AGENT" means The Chase Manhattan Bank, in its
capacity as administrative agent for the Lenders hereunder.
"ADMINISTRATIVE QUESTIONNAIRE" means an Administrative
Questionnaire in a form supplied by the Administrative Agent.
"AFFILIATE" means, with respect to a specified Person,
another Person that directly, or indirectly through one or more intermediaries,
Controls or is Controlled by or is under common Control with the Person
specified.
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"ALTERNATE BASE RATE" means, for any day, a rate per annum
equal to the greatest of (a) the Prime Rate in effect on such day, (b) the Base
CD Rate in effect on such day plus 1% and (c) the Federal Funds Effective Rate
in effect on such day plus 1/2 of 1%. Any change in the Alternate Base Rate due
to a change in the Prime Rate, the Base CD Rate or the Federal Funds Effective
Rate shall be effective from and including the effective date of such change in
the Prime Rate, the Base CD Rate or the Federal Funds Effective Rate,
respectively.
"APPLICABLE PERCENTAGE" means, with respect to any Revolving
Lender, the percentage of the total Revolving Commitments represented by such
Lender's Revolving Commitment. If the Revolving Commitments have terminated or
expired, the Applicable Percentages shall be determined based upon the
Revolving Commitments most recently in effect, giving effect to any
assignments.
"APPLICABLE RATE" means, for any day (a) with respect to any
Tranche B Term Loan, (i) 2.50% per annum, in the case of an ABR Loan, or (ii)
3.50% per annum, in the case of a Eurodollar Loan, and (b) with respect to any
ABR Loan or Eurodollar Loan that is a Revolving Loan or a Tranche A Term Loan
or any ABR Loan that is a Swingline Loan, or with respect to the commitment
fees payable hereunder, as the case may be, the applicable rate per annum set
forth below under the caption "ABR Spread", "Eurodollar Spread" or "Commitment
Fee Rate", as the case may be, based upon the Leverage Ratio as of the most
recent determination date; PROVIDED that until the date that is six months
after the Effective Date the "Applicable Rate" for purposes of clause (b) shall
be the applicable rate per annum set forth below in Category 1:
ABR Eurodollar Commitment Fee
Leverage Ratio: Spread Spread Rate
--------------- ------ ---------- ---------------
CATEGORY 1 2.00% 3.00% 0.50%
----------
Greater than or equal to 5.50
to 1.00
- ---------------------------------------------------------------------------------------
CATEGORY 2 1.75% 2.75% 0.50%
----------
Less than 5.50 to 1.00 but
greater than or equal to 5.00
to 1.00
- ---------------------------------------------------------------------------------------
CATEGORY 3 1.50% 2.50% 0.50%
----------
Less than 5.00 to 1.00 but
greater than or equal to 4.50
to 1.00
- ---------------------------------------------------------------------------------------
CATEGORY 4 1.25% 2.25% 0.50%
----------
Less than 4.50 to 1.00 but
greater than or equal to 4.00
to 1.00
- ---------------------------------------------------------------------------------------
CATEGORY 5 1.00% 2.00% 0.375%
----------
Less than 4.00 to 1.00 but
greater than or equal to 3.50
to 1.00
- ---------------------------------------------------------------------------------------
CATEGORY 6 0.75% 1.75% 0.375%
----------
Less than 3.50 to 1.00
- ---------------------------------------------------------------------------------------
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For purposes of the foregoing, (i) the Leverage Ratio shall
be determined as of the end of each fiscal quarter of the Borrower's fiscal
year based upon the Borrower's consolidated financial statements delivered
pursuant to Section 5.01(a) or (b) and (ii) each change in the Applicable Rate
resulting from a change in the Leverage Ratio shall be effective during the
period commencing on and including the date of delivery to the Administrative
Agent of such consolidated financial statements indicating such change and
ending on the date immediately preceding the effective date of the next such
change; PROVIDED that the Leverage Ratio shall be deemed to be in Category 1
(A) at any time that an Event of Default has occurred and is continuing or (B)
at the option of the Administrative Agent or at the request of the Required
Lenders if the Borrower fails to deliver the consolidated financial statements
required to be delivered by it pursuant to Section 5.01(a) or (b) during the
period from the expiration of the time for delivery thereof until such
consolidated financial statements are delivered.
"ASSESSMENT RATE" means, for any day, the annual assessment
rate in effect on such day that is payable by a member of the Bank Insurance
Fund classified as "well-capitalized" and within supervisory subgroup "B" (or a
comparable successor risk classification) within the meaning of 12 C.F.R. Part
327 (or any successor provision) to the Federal Deposit Insurance Corporation
for insurance by such Corporation of time deposits made in dollars at the
offices of such member in the United States; PROVIDED that if, as a result of
any change in any law, rule or regulation, it is no longer possible to
determine the Assessment Rate as aforesaid, then the Assessment Rate shall be
such annual rate as shall be determined by the Administrative Agent to be
representative of the cost of such insurance to the Lenders.
"ASSIGNMENT AND ACCEPTANCE" means an assignment and
acceptance entered into by a Lender and an assignee (with the consent of any
party whose consent is required by Section 9.04), and accepted by the
Administrative Agent, in the form of Exhibit A or any other form approved by
the Administrative Agent.
"BASE CD RATE" means the sum of (a) the Three-Month Secondary
CD Rate multiplied by the Statutory Reserve Rate plus (b) the Assessment Rate.
"BOARD" means the Board of Governors of the Federal Reserve
System of the United States of America.
"BORROWER" means American Media Operations, Inc., a Delaware
corporation.
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"BORROWING" means (a) Loans of the same Class and Type, made,
converted or continued on the same date and, in the case of Eurodollar Loans,
as to which a single Interest Period is in effect, or (b) a Swingline Loan.
"BORROWING REQUEST" means a request by the Borrower for a
Borrowing in accordance with Section 2.03.
"BUSINESS DAY" means any day that is not a Saturday, Sunday
or other day on which commercial banks in New York City are authorized or
required by law to remain closed; PROVIDED that, when used in connection with a
Eurodollar Loan, the term "BUSINESS DAY" shall also exclude any day on which
banks are not open for dealings in dollar deposits in the London interbank
market.
"CAPITAL EXPENDITURES" means, for any period, (a) the
additions to property, plant and equipment and other capital expenditures of
the Borrower and its Restricted Subsidiaries that are (or would be) set forth
in a consolidated statement of cash flows of the Borrower and its Restricted
Subsidiaries for such period prepared in accordance with GAAP and (b) Capital
Lease Obligations incurred by the Borrower and its Restricted Subsidiaries
during such period.
"CAPITAL LEASE OBLIGATIONS" of any Person means 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 the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"CHANGE IN CONTROL" means:
(a)(i) the acquisition of ownership, directly or indirectly,
beneficially or of record, by any Person other than Holdings of any
Equity Interest in the Borrower (other than up to 20% of the common
stock of the Borrower held by Persons other than Holdings in
accordance with Section 6.03(e)), (ii) during any period of two
consecutive years, individuals who at the beginning of such period
constituted the board of directors of Holdings (together with any new
directors whose election by such board of directors of Holdings or
whose nomination for election by the stockholders of Holdings was
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approved by a vote of at least 66-2/3% of the directors of Holdings
then still in office who were either directors at the beginning of
such period or whose nomination for election was previously so
approved) ceasing for any reason to constitute a majority of the board
of directors of Holdings, or (iii) the occurrence of a "Change of
Control", as defined in the Subordinated Debt Documents or the
Holdings Discount Notes Documents;
(b) prior to the first public offering of common Equity
Interests of Holdings, EMP Group L.L.C. ceasing to be the "beneficial
owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act),
directly or indirectly, of a majority in the aggregate of the total
voting power of the voting Equity Interests of Holdings, whether as a
result of issuance of securities of Holdings, any merger,
consolidation, liquidation or dissolution of Holdings, any direct or
indirect transfer of securities by EMP Group L.L.C. or otherwise (for
purposes of this clause (b) and clause (c) below, EMP Group L.L.C.
shall be deemed to beneficially own any voting Equity Interests of an
entity (the "specified entity") held by any other entity (the
"Holdings entity") so long as EMP Group L.L.C. beneficially owns (as
so defined), directly or indirectly, in the aggregate a majority of
the voting power of the voting Equity Interests of the Holdings
entity);
(c)(i) any "person" (as such term is used in Sections 13(d)
and 14(d) of the Exchange Act), other than EMP Group L.L.C., being or
becoming the beneficial owner (as defined in clause (b) above, except
that for purposes of this clause (c) such person shall be deemed to
have "beneficial ownership" of all shares that any such person has the
right to acquire, whether such right is exercisable immediately or
only after the passage of time), directly or indirectly, of more than
30% of the total voting power of the voting Equity Interests of
Holdings and (ii) EMP Group L.L.C. "beneficially owning" (as defined
in clause (b) above), directly or indirectly, in the aggregate a
lesser percentage of the total voting power of the voting Equity
Interests of Holdings than such other person and not having the right
or ability by voting power, contract or otherwise to elect or
designate for election a majority of the board of directors of
Holdings (for the purposes of this clause (c), such other person shall
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be deemed to beneficially own any voting Equity Interests of a
specified entity held by a Holdings entity, if such other person is
the beneficial owner (as defined in this clause (c)), directly or
indirectly, of more than 30% of the voting power of the voting Equity
Interests of such Holdings entity and EMP Group L.L.C. "beneficially
owns" (as defined in clause (b) above), directly or indirectly, in the
aggregate a lesser percentage of the voting power of the voting Equity
Interests of such Holdings entity and does not have the right or
ability by voting power, contract or otherwise to elect or designate
for election a majority of the board of directors of such Holdings
entity); or
(d) Evercore no longer having the direct or indirect power to
appoint a majority of the managers of (or other individuals
comprising) the board of managers or other governing body of EMP Group
L.L.C.
"CHANGE IN LAW" means (a) the adoption of any law, rule or
regulation after the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the date of this Agreement or (c) compliance by any Lender or
the Issuing Bank (or, for purposes of Section 2.15(b), by any lending office of
such Lender or by such Lender's or the Issuing Bank's holding company, if any)
with any request, guideline or directive (whether or not having the force of
law) of any Governmental Authority made or issued after the date of this
Agreement.
"CLASS", when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are
Revolving Loans, Tranche A Term Loans, Tranche B Term Loans or Swingline Loans
and, when used in reference to any Commitment, refers to whether such
Commitment is a Revolving Commitment, Tranche A Commitment or Tranche B
Commitment.
"CODE" means the Internal Revenue Code of 1986, as amended
from time to time.
"COLLATERAL" means any and all "Collateral", as defined in
any applicable Security Document.
"COLLATERAL AGENT" means the "Collateral Agent", as defined
in the Security Agreement.
"COMMITMENT" means a Revolving Commitment, Tranche A
Commitment or Tranche B Commitment, or any combination thereof (as the context
requires).
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"CONSOLIDATED EBITDA" means, for any period, Consolidated Net
Income for such period (adjusted to exclude any extraordinary losses, charges
or gains and to exclude any gain or loss recognized in connection with the sale
of any assets outside the ordinary course of business), PLUS, without
duplication and to the extent deducted from revenues in determining
Consolidated Net Income, the sum of (a) the aggregate amount of interest
expense for such period, (b) the aggregate amount of income tax expense for
such period, (c) all amounts attributable to depreciation, amortization and
other noncash charges (excluding any such charge that (i) consists of or
requires an accrual of, or cash reserve for, any anticipated cash changes for
any prior or in any future period or (ii) consists of a writedown or writeoff
of any current assets) for such period, including the amortization of debt
discounts and deferred financing charges, all as determined on a consolidated
basis with respect to the Borrower and the Restricted Subsidiaries in
accordance with GAAP, (d) the aggregate amount of management fees paid to
Affiliates of the Borrower in such period pursuant to Section 6.09, (e)
payments made by the Borrower and its Restricted Subsidiaries in such period
pursuant to profit sharing plans; PROVIDED that such payments are discretionary
under the terms of such plans, (f) the aggregate amount, not to exceed
$5,000,000, of nonrecurring charges resulting from severance, restructuring,
corporate relocation expenses and other adjustments made as a result of or in
connection with the Transactions and recognized on or prior to the date that is
18 months subsequent to the Effective Date and (g) any nonrecurring cash
expenses or charges (not exceeding $3,000,000 in the aggregate for such period)
related to any initial public offering, investment, Permitted Acquisition or
Indebtedness, and MINUS the amount of any Restricted Payments made to Holdings
by the Borrower pursuant to Section 6.08(a)(iv) (as such amount may be
supplemented in accordance with Section 6.08(a)(viii)) during such period to
the extent of any losses, charges or expenses that reduced Holdings' net income
(or increased its net loss) during such period. For purposes of calculating
Consolidated EBITDA for any period (each, a "Reference Period") in connection
with a determination of the Leverage Ratio or the Senior Leverage Ratio for
such period, if during such Reference Period (or, in the case of PRO FORMA
calculations, during the period from the last day of such Reference Period to
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and including the date as of which such calculation is made) the Borrower or
any Restricted Subsidiary shall have made a Material Disposition or Material
Acquisition, Consolidated EBITDA for such Reference Period shall be calculated
after giving PRO FORMA effect thereto as if such Material Disposition or
Material Acquisition occurred on the first day of such Reference Period (with
the Reference Period for the purposes of PRO FORMA calculations being the most
recent period of four consecutive fiscal quarters for which the relevant
financial information is available); PROVIDED that such PRO FORMA calculations
shall give effect to operating expense reductions and other cost savings only
to the extent that such reductions and savings are approved by the
Administrative Agent and realization thereof is reasonably expected by the
Borrower to be achieved within six months after such Material Acquisition or
Material Disposition. As used in this definition, "Material Acquisition" means
any Permitted Acquisition or series of related Permitted Acquisitions that
involves consideration (including any noncash consideration) with a fair market
value in excess of $5,000,000; and "Material Disposition" means any disposition
of property or series of related dispositions of property that involves assets
comprising all or substantially all of an operating unit of a business or
constitutes all or substantially all of the Equity Interests of a Subsidiary.
"CONSOLIDATED FIXED CHARGES" means, for any period, the sum
of (a) Consolidated Interest Expense for such period, (b) the aggregate amount
of scheduled principal payments of Long-Term Indebtedness made during such
period by the Borrower or any Restricted Subsidiary to any Person other than
the Borrower or any wholly owned Restricted Subsidiary and (c) the aggregate
amount of scheduled principal payments of Long-Term Indebtedness that would
have been required to be made during such period by the Borrower or any
Restricted Subsidiary to the extent any such scheduled payment is not required
to be made by reason of any optional prepayment (other than an optional
prepayment to the extent financed with the proceeds of an incurrence of
Long-Term Indebtedness) made within one year prior to the date such scheduled
principal payment would have been due.
"CONSOLIDATED INTEREST EXPENSE" means, for any period, the
sum of (a) interest expense (including the interest component in respect of
Capital Lease Obligations but excluding the amortization of debt discounts,
deferred financing charges and other non-cash interest expenses) of the
Borrower and the Restricted Subsidiaries during such period, determined on a
consolidated basis in accordance with GAAP, and (b) the amount of any
Restricted Payments made by the Borrower to Holdings pursuant to Section
6.08(a)(vii)(B) during such period.
"CONSOLIDATED NET INCOME" means, for any period, net income
or loss of the Borrower and the Restricted Subsidiaries for such period
determined on a consolidated basis in accordance with GAAP; PROVIDED that there
shall be excluded (a) the income of any Person in which any other Person (other
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than the Borrower or any of the Restricted Subsidiaries or any director holding
qualifying shares in compliance with applicable law) has an ownership interest,
except to the extent of the amount of dividends or other distributions actually
paid to the Borrower or any of the Restricted Subsidiaries by such Person
during such period, and (b) the income (or loss) of any Person accrued prior to
the date it becomes a Restricted Subsidiary or is merged into or consolidated
with the Borrower or any of the Restricted Subsidiaries or the date that
Person's assets are acquired by the Borrower or any of the Restricted
Subsidiaries.
"CONTROL" means the possession, directly or indirectly, of
the power to direct or cause the direction of the management or policies of a
Person, whether through the ability to exercise voting power, by contract or
otherwise. "CONTROLLING" and "CONTROLLED" have meanings correlative thereto.
"DEBT TENDER OFFER" means the tender offer and consent
solicitation made by the Borrower for all the outstanding Existing Notes
pursuant to the Debt Tender Offer Materials and the provisions of the Merger
Agreement.
"DEBT TENDER OFFER MATERIALS" means the offer to purchase
distributed by the Borrower to holders of the Existing Notes with respect to
the Debt Tender Offer, and all related materials similarly distributed in
accordance with this Agreement.
"DEFAULT" means any event or condition which constitutes an
Event of Default or which upon notice, lapse of time or both would, unless
cured or waived, become an Event of Default.
"DISCLOSED MATTERS" means the actions, suits and proceedings
and the environmental matters disclosed in Schedule 3.06.
"DISQUALIFIED STOCK" means, with respect to any Person, any
Equity Interest which by its terms (or by the terms of any security into which
it is convertible or for which it is exchangeable or exercisable) or upon the
happening of any event:
(a) matures or is mandatorily redeemable pursuant to a
sinking fund obligation or otherwise;
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(b) is convertible or exchangeable for Indebtedness or
Disqualified Stock (excluding Equity Interests convertible or
exchangeable solely at the option of Holdings, the Borrower or a
Restricted Subsidiary; PROVIDED that any such conversion or exchange
shall be deemed an issuance of Disqualified Stock, as applicable); or
(c) is redeemable, or subject to mandatory purchase by
Holdings, the Borrower or any Subsidiary, at the option of the holder
thereof, in whole or in part.
"DOLLARS" or "$" refers to lawful money of the United States
of America.
"EFFECTIVE DATE" means the date on which the conditions
specified in Section 4.01 are satisfied (or waived in accordance with Section
9.02).
"ENVIRONMENTAL LAWS" means all laws, rules, regulations,
codes, ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources or the management, release or threatened release of any Hazardous
Material.
"ENVIRONMENTAL LIABILITY" means any liability, contingent or
otherwise (including any liability for damages, costs of environmental
remediation, fines, penalties or indemnities), of Holdings, the Borrower or any
Subsidiary directly or indirectly resulting from or based upon (a) violation of
any Environmental Law, (b) the generation, use, handling, transportation,
storage, treatment or disposal of any Hazardous Materials, (c) exposure to any
Hazardous Materials, (d) the release or threatened release of any Hazardous
Materials into the environment or (e) any contract, agreement or other
consensual arrangement pursuant to which liability is assumed or imposed with
respect to any of the foregoing.
"EQUITY CONTRIBUTION" means the cash equity contribution to
be made by EMP Group L.L.C. to Merger Sub prior to the Merger in an aggregate
amount of not less than $235,000,000.
"EQUITY INTERESTS" means 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.
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"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time.
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA EVENT" means (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived); (b)
the existence with respect to any Plan of an "accumulated funding deficiency"
(as defined in Section 412 of the Code or Section 302 of ERISA), whether or not
waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d)
of ERISA of an application for a waiver of the minimum funding standard with
respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability under Title IV of ERISA with respect to the
termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate
from the PBGC or a plan administrator of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f)
the incurrence by the Borrower or any of its ERISA Affiliates of any liability
with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate
of any notice, or the receipt by any Multiemployer Plan from the Borrower or
any ERISA Affiliate of any notice, concerning the imposition of Withdrawal
Liability or a determination that a Multiemployer Plan is, or is expected to
be, insolvent or in reorganization, within the meaning of Title IV of ERISA.
"EURODOLLAR", when used in reference to any Loan or
Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing,
are bearing interest at a rate determined by reference to the Adjusted LIBO
Rate.
"EVENT OF DEFAULT" has the meaning assigned to such term in
Article VII.
"EVERCORE" means Evercore Partners Inc. and any investment
fund Controlled by Evercore Partners Inc.
"EXCESS CASH FLOW" means, for any fiscal year, the sum
(without duplication) of:
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(a) Consolidated Net Income for such fiscal year, adjusted to
exclude any gains or losses attributable to Prepayment Events; PLUS
(b) depreciation, amortization and other non-cash charges or
losses deducted in determining such Consolidated Net Income for such
fiscal year; PLUS
(c) the sum of (i) the amount, if any, by which Net Working
Capital decreased during such fiscal year plus (ii) the net amount, if
any, by which the long-term consolidated deferred revenues of the
Borrower and its Restricted Subsidiaries increased during such fiscal
year; MINUS
(d) the sum of (i) any noncash gains included in determining
such Consolidated Net Income for such fiscal year plus (ii) the
amount, if any, by which Net Working Capital increased during such
fiscal year plus (iii) the net amount, if any, by which the long-term
consolidated deferred revenues of the Borrower and its Restricted
Subsidiaries decreased during such fiscal year; MINUS
(e) the sum of (i) Capital Expenditures for such fiscal year
(except to the extent attributable to the incurrence of Capital Lease
Obligations or otherwise financed by incurring Long-Term Indebtedness
or attributable to the reinvestment of Net Proceeds of a Prepayment
Event) plus (ii) cash consideration paid during such fiscal year to
make acquisitions or other capital investments (except to the extent
financed by incurring Long-Term Indebtedness or attributable to the
reinvestment of Net Proceeds of a Prepayment Event); MINUS
(f) the aggregate principal amount of Long-Term Indebtedness
repaid or prepaid by the Borrower and its Restricted Subsidiaries
during such fiscal year, excluding (i) Indebtedness in respect of
Swingline Loans, Revolving Loans and Letters of Credit, (ii) Term
Loans prepaid pursuant to Section 2.11(c) or (d) and (iii) repayments
or prepayments of Long-Term Indebtedness financed by incurring other
Long-Term Indebtedness.
"EXCLUDED TAXES" means, with respect to the Administrative
Agent, any Lender, the Issuing Bank or any other recipient of any payment to be
made by or on account of any obligation of the Borrower hereunder, (a) income
or franchise taxes imposed on (or measured by) its net income by the United
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States of America, or by the jurisdiction under the laws of which such
recipient is organized or in which its principal office is located or, in the
case of any Lender, in which its applicable lending office is located, (b) any
branch profits taxes imposed by the United States of America or any similar tax
imposed by any other jurisdiction described in clause (a) above and (c) in the
case of a Foreign Lender (other than an assignee pursuant to a request by the
Borrower under Section 2.19(b)), any withholding tax that (i) is in effect and
would apply to amounts payable to such Foreign Lender at the time such Foreign
Lender becomes a party to this Agreement (or designates a new lending office),
except to the extent that such Foreign Lender (or its assignor, if any) was
entitled, at the time of designation of a new lending office (or assignment),
to receive additional amounts from the Borrower with respect to any withholding
tax pursuant to Section 2.17(a), or (ii) is attributable to such Foreign
Lender's failure to comply with Section 2.17(e).
"EXISTING CREDIT AGREEMENT" means the Fourth Amended and
Restated Credit Agreement dated as of June 5, 1998, among the Borrower, certain
of its subsidiaries, certain banks from time to time parties thereto and The
Chase Manhattan Bank, as agent.
"EXISTING NOTES" means the 11 5/8% Senior Subordinated Notes
due 2004 of the Borrower.
"EXISTING NOTES INDENTURE" means the Indenture dated as of
November 1, 1994, between the Borrower (f/k/a Enquirer/Star, Inc.) and United
States Trust Company of New York, as trustee, as amended pursuant to the Debt
Tender Offer.
"FEDERAL FUNDS EFFECTIVE RATE" means, for any day, the
weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) 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 that is a Business Day, the average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for
such day for such transactions received by the Administrative Agent from three
Federal funds brokers of recognized standing selected by it.
"FINANCIAL OFFICER" means the chief financial officer,
principal accounting officer, treasurer or controller of the Borrower.
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"FINANCING TRANSACTIONS" means (a) the execution, delivery
and performance by each Loan Party of the Loan Documents to which it is to be a
party, the borrowing of Loans, the use of the proceeds thereof and the issuance
of Letters of Credit hereunder and (b) the execution, delivery and performance
by each Loan Party of the Subordinated Debt Documents to which it is to be a
party, the issuance of the Subordinated Debt and the use of the proceeds
thereof.
"FOREIGN LENDER" means any Lender that is organized under the
laws of a jurisdiction other than that in which the Borrower is located. For
purposes of this definition, the United States of America, each State thereof
and the District of Columbia shall be deemed to constitute a single
jurisdiction.
"FOREIGN SUBSIDIARY" means any Subsidiary that is organized
under the laws of a jurisdiction other than the United States of America or any
State thereof or the District of Columbia.
"GAAP" means generally accepted accounting principles in the
United States of America.
"GOVERNMENTAL AUTHORITY" means the government of the United
States of America, any other nation or any political subdivision thereof,
whether state or local, and any agency, authority, instrumentality, regulatory
body, court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.
"GUARANTEE" of or by any Person (the "GUARANTOR") means any
obligation, contingent or otherwise, of the guarantor guaranteeing or having
the economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "PRIMARY OBLIGOR") in any manner, whether directly or
indirectly, and including any obligation of the guarantor, direct or indirect,
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof, (c)
to maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account party
in respect of any letter of credit or letter of guaranty issued to support such
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Indebtedness or obligation; PROVIDED that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business.
"GUARANTEE AGREEMENT" means the Guarantee Agreement,
substantially in the form of Exhibit C, among Holdings, the Subsidiary Loan
Parties and the Collateral Agent for the benefit of the Secured Parties.
"HAZARDOUS MATERIALS" means all explosive or radioactive
substances or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or asbestos
containing materials, polychlorinated biphenyls, radon gas, infectious or
medical wastes and all other substances or wastes of any nature regulated
pursuant to any Environmental Law.
"HEDGING AGREEMENT" means any interest rate protection
agreement, foreign currency exchange agreement, commodity price protection
agreement or other interest or currency exchange rate or commodity price
hedging arrangement.
"HOLDINGS" means American Media, Inc., a Delaware
corporation.
"HOLDINGS DISCOUNT NOTES" means discount notes of Holdings
(a) that are issued on a single date that is after the Effective Date, (b) with
an initial aggregate accreted value of up to $25,000,000, (c) with respect to
which no cash interest shall be payable until the fifth anniversary of issuance
and cash interest shall be payable semi-annually after such fifth anniversary,
(d) that mature no earlier than the tenth anniversary of issuance and do not
require any amortization or other required redemption or repayment prior to
maturity (other than redemption on the fifth anniversary of issuance of a
portion of such discount notes not exceeding the Holdings Discount Notes
Redemption Amount at a redemption price of 100% of the principal amount so
redeemed), (e) that are not Guaranteed by the Borrower or any Subsidiary, (f)
the Net Proceeds of the issuance of which are contributed as common equity to
the Borrower and (g) that have such other terms and conditions (including with
respect to covenants and events of default) that (i) are customary for
high-yield discount notes issued by holding companies and (ii) are approved by
the Administrative Agent.
"HOLDINGS DISCOUNT NOTES DOCUMENTS" means the indenture under
which the Holdings Discount Notes are issued and all other instruments,
agreements and other documents evidencing or governing the Holdings Discount
Notes or providing for any other right in respect thereof.
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"HOLDINGS DISCOUNT NOTES REDEMPTION AMOUNT" means the amount
equal to (a)(i) the excess of the aggregate accreted value of Holdings Discount
Notes on the fifth anniversary of the date of their issuance over (ii) the
aggregate accreted value of the Holdings Discount Notes on the date of their
issuance, less (b) an amount equal to simple interest for one year on the
aggregate accreted value of the Holdings Discount Notes on the date of their
issuance at a per annum rate equal to the yield to maturity of such Holdings
Discount Notes.
"INDEBTEDNESS" of any Person means, without duplication, (a)
all obligations of such Person for borrowed money or with respect to deposits
or advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of such
Person under conditional sale or other title retention agreements relating to
property acquired by such Person, (e) all obligations of such Person in respect
of the deferred purchase price of property or services (excluding current
accounts payable incurred in the ordinary course of business), (f) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, whether or not the Indebtedness
secured thereby has been assumed, (g) all Guarantees by such Person of
Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i)
all obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty and (j) all obligations,
contingent or otherwise, of such Person in respect of bankers' acceptances. 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 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 provide that such Person is not liable therefor.
"INDEMNIFIED TAXES" means Taxes other than Excluded Taxes.
"INDEMNITY, SUBROGATION AND CONTRIBUTION AGREEMENT" means the
Indemnity, Subrogation and Contribution Agreement, substantially in the form of
Exhibit D, among the Borrower, the Subsidiary Loan Parties and the
Administrative Agent.
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"INFORMATION MEMORANDUM" means the Confidential Information
Memorandum dated April 1999 relating to the Borrower and the Transactions.
"INTEREST ELECTION REQUEST" means a request by the Borrower
to convert or continue a Revolving Borrowing or Term Borrowing in accordance
with Section 2.07.
"INTEREST PAYMENT DATE" means (a) with respect to any ABR
Loan (other than a Swingline Loan), the last day of each March, June, September
and December, (b) with respect to any Eurodollar Loan, the last day of the
Interest Period applicable to the Borrowing of which such Loan is a part and,
in the case of a Eurodollar Borrowing with an Interest Period of more than
three months' duration, each day prior to the last day of such Interest Period
that occurs at intervals of three months' duration after the first day of such
Interest Period, and (c) with respect to any Swingline Loan, the day that such
Loan is required to be repaid.
"INTEREST PERIOD" means, with respect to any Eurodollar
Borrowing, the period commencing on the date of such Borrowing and ending on
the numerically corresponding day in the calendar month that is one, two, three
or six months thereafter (or nine or twelve months thereafter if, at the time
of the relevant Borrowing, all Lenders participating therein agree to make
interest periods of such duration available), as the Borrower may elect;
PROVIDED that (a) if any Interest Period would end on a day other than a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless such next succeeding Business Day would fall in the next
calendar month, in which case such Interest Period shall end on the next
preceding Business Day and (b) any Interest Period that commences on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the last calendar month of such Interest Period) shall end
on the last Business Day of the last calendar month of such Interest Period.
For purposes hereof, the date of a Borrowing initially shall be the date on
which such Borrowing is made and thereafter shall be the effective date of the
most recent conversion or continuation of such Borrowing.
"ISSUING BANK" means The Chase Manhattan Bank, in its
capacity as the issuer of Letters of Credit hereunder, and its successors in
such capacity as provided in Section 2.05(i). The Issuing Bank may, in its
discretion, arrange for one or more Letters of Credit to be issued by
Affiliates of the Issuing Bank, in which case the term "Issuing Bank" shall
include any such Affiliate with respect to Letters of Credit issued by such
Affiliate.
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"LC DISBURSEMENT" means a payment made by the Issuing Bank
pursuant to a Letter of Credit.
"LC EXPOSURE" means, at any time, the sum of (a) the
aggregate undrawn amount of all outstanding Letters of Credit at such time plus
(b) the aggregate amount of all LC Disbursements that have not yet been
reimbursed by or on behalf of the Borrower at such time. The LC Exposure of any
Revolving Lender at any time shall be its Applicable Percentage of the total LC
Exposure at such time.
"LENDERS" means the Persons listed on Schedule 2.01 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 Acceptance. Unless the context otherwise
requires, the term "Lenders" includes the Swingline Lender.
"LETTER OF CREDIT" means any letter of credit issued pursuant
to this Agreement.
"LEVERAGE RATIO" means, on any date, the ratio of (a) Total
Debt as of such date to (b) Consolidated EBITDA for the period of four
consecutive fiscal quarters ended on such date (or, solely for purposes of
determining the Applicable Rate, two times Consolidated EBITDA for the period
of two consecutive fiscal quarters ended on such date), all determined on a
consolidated basis in accordance with GAAP.
"LIBO RATE" means, with respect to any Eurodollar Borrowing
for any Interest Period, the rate appearing on Page 3750 of the Telerate
Service (or on any successor or substitute page of such Service, or any
successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as
determined by the Administrative Agent from time to time for purposes of
providing quotations of interest rates applicable to dollar deposits in the
London interbank market) at approximately 11:00 a.m., London time, two Business
Days prior to the commencement of such Interest Period, as the rate for dollar
deposits with a maturity comparable to such Interest Period. In the event that
such rate is not available at such time for any reason, then the "LIBO RATE"
with respect to such Eurodollar Borrowing for such Interest Period shall be the
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rate at which dollar deposits of $5,000,000 and for a maturity comparable to
such Interest Period are offered by the principal London office of the
Administrative Agent in immediately available funds in the London interbank
market at approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period.
"LIEN" means, with respect to any asset, (a) any mortgage,
deed of trust, lien, pledge, hypothecation, encumbrance, charge or security
interest in, on or of such asset, (b) the interest of a vendor or a lessor
under any conditional sale agreement, capital lease or title retention
agreement (or any financing lease having substantially the same economic effect
as any of the foregoing) relating to such asset and (c) in the case of
securities, any purchase option, call or similar right of a third party with
respect to such securities.
"LLC AGREEMENT" means the Amended and Restated Limited
Liability Company Agreement and Investors Rights Agreement of EMP Group L.L.C.
dated as of February 16, 1999.
"LOAN DOCUMENTS" means this Agreement, the Guarantee
Agreement, the Indemnity, Subrogation and Contribution Agreement and the
Security Documents.
"LOAN PARTIES" means Holdings, the Borrower and the
Subsidiary Loan Parties.
"LOANS" means the loans made by the Lenders to the Borrower
pursuant to this Agreement.
"LONG-TERM INDEBTEDNESS" means any Indebtedness that, in
accordance with GAAP, constitutes (or, when incurred, constituted) a long-term
liability.
"MANAGEMENT AGREEMENT" means the Side Letter dated February
16, 1999 among the members of EMP Group L.L.C.
"MARGIN STOCK" shall have the meaning assigned to such term
in Regulation U of the Board.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on
(a) the business, assets, operations or condition, financial or otherwise, of
Holdings, the Borrower and the Restricted Subsidiaries taken as a whole, (b)
the ability of any Loan Party to perform any of its obligations under any Loan
Document or (c) the rights of or benefits available to the Lenders under any
Loan Document.
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"MATERIAL INDEBTEDNESS" means Indebtedness (other than the
Loans and Letters of Credit), or obligations in respect of one or more Hedging
Agreements, of any one or more of Holdings, the Borrower and its Restricted
Subsidiaries in an aggregate principal amount exceeding $5,000,000. For
purposes of determining Material Indebtedness, the "principal amount" of the
obligations of Holdings, the Borrower or any Restricted Subsidiary in respect
of any Hedging Agreement at any time shall be the maximum aggregate amount
(giving effect to any netting agreements) that Holdings, the Borrower or such
Restricted Subsidiary would be required to pay if such Hedging Agreement were
terminated at such time.
"MERGER" means the merger of Merger Sub with and into
Holdings, with Holdings as the surviving corporation, pursuant to the Merger
Agreement.
"MERGER AGREEMENT" means the Agreement and Plan of Merger,
dated as of February 16, 1999, by and between Holdings and Merger Sub.
"MERGER SUB" means EMP Acquisition Corp., a Delaware
corporation.
"MOODY'S" means Moody's Investors Service, Inc.
"MORTGAGE" means a mortgage, deed of trust, assignment of
leases and rents, leasehold mortgage or other security document granting a Lien
on any Mortgaged Property to secure the Obligations. Each Mortgage shall be
satisfactory in form and substance to the Collateral Agent.
"MORTGAGED PROPERTY" means, initially, each parcel of real
property and the improvements thereto owned by a Loan Party and identified on
Schedule 1.01(a), and includes each other parcel of real property and
improvements thereto with respect to which a Mortgage is granted pursuant to
Section 5.12 or 5.13.
"MULTIEMPLOYER PLAN" means a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"NET PROCEEDS" means, with respect to any event (a) the cash
proceeds received in respect of such event including (i) any cash received in
respect of any non-cash proceeds, but only as and when received, (ii) in the
case of a casualty, insurance proceeds, and (iii) in the case of a condemnation
or similar event, condemnation awards and similar payments, net of (b) the sum
of (i) all reasonable fees and out-of-pocket expenses paid by Holdings, the
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Borrower and the Restricted Subsidiaries to third parties (other than
Affiliates) in connection with such event, (ii) in the case of a sale, transfer
or other disposition of an asset (including pursuant to a sale and leaseback
transaction or a casualty or a condemnation or similar proceeding), the amount
of all payments required to be made by Holdings, the Borrower and the
Restricted Subsidiaries as a result of such event to repay Indebtedness (other
than Loans) secured by such asset or otherwise subject to mandatory prepayment
as a result of such event, and (iii) the amount of all taxes paid (or
reasonably estimated to be payable) by Holdings, the Borrower and the
Restricted Subsidiaries, and the amount of any reserves established by
Holdings, the Borrower and the Restricted Subsidiaries to fund contingent
liabilities reasonably estimated to be payable, in each case during the year
that such event occurred or the next succeeding year and that are directly
attributable to such event (as determined reasonably and in good faith by the
chief financial officer of the Borrower).
"NET WORKING CAPITAL" means, at any date, (a) the
consolidated current assets of the Borrower and its consolidated Restricted
Subsidiaries as of such date (excluding cash and Permitted Investments) minus
(b) the consolidated current liabilities of the Borrower and its consolidated
Restricted Subsidiaries as of such date (excluding current liabilities in
respect of Indebtedness). Net Working Capital at any date may be a positive or
negative number. Net Working Capital increases when it becomes more positive or
less negative and decreases when it becomes less positive or more negative.
"OBLIGATIONS" has the meaning assigned to such term in the
Security Agreement.
"OTHER TAXES" means any and all present or future recording,
stamp, documentary, excise, transfer, sales, property or similar taxes, charges
or levies arising from any payment made under any Loan Document or from the
execution, delivery or enforcement of, or otherwise with respect to, any Loan
Document.
"PBGC" means the Pension Benefit Guaranty Corporation
referred to and defined in ERISA and any successor entity performing similar
functions.
"PERFECTION CERTIFICATE" means a certificate in the form of
Annex II to the Security Agreement or any other form approved by the Collateral
Agent.
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"PERMITTED ACQUISITION" means any acquisition by the Borrower
or any Restricted Subsidiary of all or substantially all the assets of, or all
the Equity Interests in, a Person or division or line of business of a Person
if, immediately after giving effect thereto, (a) no Default has occurred and is
continuing or would result therefrom, (b) the principal business of such Person
shall be reasonably related, ancillary or complementary, to a business in which
the Borrower and its Restricted Subsidiaries were engaged on the Effective
Date, (c) each Subsidiary formed for the purpose of or resulting from such
acquisition shall be a Restricted Subsidiary and all of the Equity Interests of
each such Subsidiary shall be owned directly by the Borrower or a Restricted
Subsidiary of the Borrower and all actions required to be taken with respect to
such acquired or newly formed Subsidiary under Sections 5.12 and 5.13 have been
taken, (d) the Borrower and its Restricted Subsidiaries are in compliance, on a
PRO FORMA basis after giving effect to such acquisition (and any operating
expense reductions related thereto that would be permitted to be deducted in
any calculation of Consolidated EBITDA in accordance with the definition of
such term contained herein), with the covenants contained in Sections 6.12,
6.13, 6.14 and 6.15 (based on the required compliance level for September 27,
1999, in the case of an acquisition made prior to such date) recomputed as at
the last day of the most recently ended fiscal quarter of the Borrower for
which financial statements are available, as if such acquisition had occurred
on the first day of each relevant period for testing such compliance and (e)
the Borrower has delivered to the Administrative Agent an officers' certificate
to the effect set forth in clauses (a), (b), (c) and (d) above, together with
all relevant financial information for the Person or assets to be acquired and
reasonably detailed calculations demonstrating satisfaction of the requirement
set forth in clause (d) above.
"PERMITTED ENCUMBRANCES" means:
(a) Liens imposed by law for taxes that are not yet due or
are being contested in compliance with Section 5.05;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's and other like Liens imposed by law, arising in the
ordinary course of business and securing obligations that are not
overdue by more than 30 days or are being contested in compliance with
Section 5.05;
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(c) pledges and deposits made in the ordinary course of
business in compliance with workers' compensation, unemployment
insurance and other social security laws or regulations;
(d) deposits to secure the performance of bids, trade
contracts, leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature, in each case
in the ordinary course of business;
(e) judgment liens in respect of judgments that do not
constitute an Event of Default under clause (k) of Article VII; and
(f) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the
ordinary course of business that do not secure any monetary
obligations and do not materially detract from the value of the
affected property or interfere with the ordinary conduct of business
of the Borrower or any Subsidiary;
PROVIDED that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness.
"PERMITTED INVESTMENTS" means:
(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 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) investments in commercial paper maturing within 270 days
from the date of acquisition thereof and having, at such date of
acquisition, the highest credit rating obtainable from S&P or from
Moody's;
(c) investments in certificates of deposit, banker's
acceptances and time deposits maturing within 180 days from the date
of acquisition thereof issued or guaranteed by or placed with, and
money market deposit accounts issued or offered by, any domestic
office of any commercial bank organized under the laws of the United
States of America or any State thereof which has a combined capital
and surplus and undivided profits of not less than $500,000,000; and
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(d) fully collateralized repurchase agreements with a term of
not more than 30 days for securities described in clause (a) above and
entered into with a financial institution satisfying the criteria
described in clause (c) above.
"PERSON" means any natural person, corporation, limited
liability company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.
"PLAN" means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower
or any ERISA Affiliate is (or, if such plan were terminated, would under
Section 4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5)
of ERISA.
"PLEDGE AGREEMENT" means the Pledge Agreement among the Loan
Parties and the Collateral Agent for the benefit of the Secured Parties,
substantially in the form of Exhibit E.
"PREPAYMENT EVENT" means:
(a) any sale, transfer or other disposition (including
pursuant to a sale and leaseback transaction) of any property or asset
of the Borrower or any Restricted Subsidiary, other than (i)
dispositions described in clauses (a) and (b) of Section 6.05 and (ii)
any other disposition (or series of related dispositions) as to which
the Net Proceeds do not exceed $100,000; or
(b) any casualty or other insured damage to, or any taking
under power of eminent domain or by condemnation or similar proceeding
of, any property or asset of the Borrower or any Restricted
Subsidiary, but only to the extent that the Net Proceeds therefrom
have not been applied to repair, restore or replace such property or
asset within 360 days after such event; or
(c) the issuance by Holdings, the Borrower or any Restricted
Subsidiary of any Equity Interests, or the receipt by Holdings, the
Borrower or any Restricted Subsidiary of any capital contribution,
other than (i) any such issuance of Equity Interests to, or receipt of
any such capital contribution from, Holdings, the Borrower or a
Restricted Subsidiary or (ii) any such issuance of Equity Interests by
Holdings in a private placement; or
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(d) the incurrence by Holdings, the Borrower or any
Restricted Subsidiary of any Indebtedness, other than Indebtedness
permitted by Section 6.01.
"PRIME RATE" means the rate of interest per annum publicly
announced from time to time by The Chase Manhattan Bank as its prime rate in
effect at its principal office in New York City; each change in the Prime Rate
shall be effective from and including the date such change is publicly
announced as being effective.
"REGISTER" has the meaning set forth in Section 9.04.
"RELATED FUND" means, with respect to any Lender that is a
fund that invests in bank loans in the ordinary course of business, any other
fund that invests in bank loans in the ordinary course of business and is
advised or managed by the same investment advisor as such Lender or by an
Affiliate of such investment advisor.
"RELATED PARTIES" means, with respect to any specified
Person, such Person's Affiliates and the respective directors, officers,
employees, trustees, agents and advisors of such Person and such Person's
Affiliates.
"REQUIRED LENDERS" means, at any time, Lenders having
Revolving Exposures, Term Loans and unused Commitments representing more than
50% of the sum of the total Revolving Exposures, outstanding Term Loans and
unused Commitments at such time.
"RESTRICTED PAYMENT" means any dividend or other distribution
(whether in cash, securities or other property) with respect to any Equity
Interests in Holdings, the Borrower or any Restricted 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, cancelation or termination of any Subordinated Debt or any Equity
Interests in Holdings, the Borrower or any Restricted Subsidiary or any option,
warrant or other right to acquire any such Equity Interests in Holdings, the
Borrower or any Restricted Subsidiary.
"RESTRICTED SUBSIDIARY" means any Subsidiary that is not an
Unrestricted Subsidiary.
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"REVOLVING AVAILABILITY PERIOD" means the period from and
including the Effective Date to but excluding the earlier of the Revolving
Maturity Date and the date of termination of the Revolving Commitments.
"REVOLVING COMMITMENT" means, with respect to each Lender,
the commitment, if any, of such Lender to make Revolving Loans and to acquire
participations in Letters of Credit and Swingline Loans hereunder, expressed as
an amount representing the maximum aggregate amount of such Lender's Revolving
Exposure hereunder, as such commitment may be (a) reduced from time to time
pursuant to Section 2.08 and (b) reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 9.04. The
initial amount of each Lender's Revolving Commitment is set forth on Schedule
2.01, or in the Assignment and Acceptance pursuant to which such Lender shall
have assumed its Revolving Commitment, as applicable. The initial aggregate
amount of the Lenders' Revolving Commitments is $60,000,000.
"REVOLVING EXPOSURE" means, with respect to any Lender at any
time, the sum of the outstanding principal amount of such Lender's Revolving
Loans and its LC Exposure and Swingline Exposure at such time.
"REVOLVING LENDER" means a Lender with a Revolving Commitment
or, if the Revolving Commitments have terminated or expired, a Lender with
Revolving Exposure.
"REVOLVING LOAN" means a Loan made pursuant to clause (c) of
Section 2.01.
"REVOLVING MATURITY DATE" means April 1, 2006.
"S&P" means Standard & Poor's.
"SECURED PARTIES" has the meaning assigned to such term in
the Security Agreement.
"SECURITY AGREEMENT" means the Security Agreement,
substantially in the form of Exhibit F, among the Borrower, Holdings, the
Subsidiary Loan Parties and the Collateral Agent for the benefit of the Secured
Parties.
"SECURITY DOCUMENTS" means the Security Agreement, the Pledge
Agreement, the Mortgages and each other security agreement or other instrument
or document executed and delivered pursuant to Section 5.12 or 5.13 to secure
any of the Obligations.
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"SENIOR LEVERAGE RATIO" means, on any date, the ratio of (a)
Total Senior Debt as of such date to (b) Consolidated EBITDA for the period of
four consecutive fiscal quarters ended on such date, all determined on a
consolidated basis in accordance with GAAP.
"STATUTORY RESERVE RATE" means a fraction (expressed as a
decimal), the numerator of which is the number one and the denominator of which
is the number one minus the aggregate of the maximum reserve percentages
(including any marginal, special, emergency or supplemental reserves) expressed
as a decimal established by the Board to which the Administrative Agent is
subject (a) with respect to the Base CD Rate, for new negotiable nonpersonal
time deposits in dollars of over $100,000 with maturities approximately equal
to three months and (b) with respect to the Adjusted LIBO Rate, for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of the Board). Such reserve percentages shall include those
imposed pursuant to such Regulation D. Eurodollar Loans shall be deemed to
constitute eurocurrency funding and to be subject to such reserve requirements
without benefit of or credit for proration, exemptions or offsets that may be
available from time to time to any Lender under such Regulation D or any
comparable regulation. The Statutory Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage.
"SUBORDINATED DEBT" means the Senior Subordinated Notes due
2009 to be issued by the Borrower on or prior to the Effective Date in the
aggregate principal amount of $250,000,000 and the Indebtedness represented
thereby.
"SUBORDINATED DEBT DOCUMENTS" means the indenture under which
the Subordinated Debt is issued and all other instruments, agreements and other
documents evidencing or governing the Subordinated Debt or providing for any
Guarantee or other right in respect thereof.
"SUBSIDIARY" means, with respect to any Person (the "PARENT")
at any date, any corporation, limited liability company, partnership,
association or other entity 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, as
well as any other corporation, limited liability company, partnership,
association or other entity (a) of which securities or other ownership
interests representing more than 50% of the equity or more than 50% of the
ordinary voting power or, in the case of a partnership, more than 50% of the
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general partnership interests are, as of such date, owned, controlled or held,
or (b) that is, as of such date, otherwise Controlled, by the parent or one or
more subsidiaries of the parent or by the parent and one or more subsidiaries
of the parent.
"SUBSIDIARY" means any subsidiary of the Borrower.
"SUBSIDIARY LOAN PARTY" means any Restricted Subsidiary that
is not a Foreign Subsidiary.
"SWINGLINE EXPOSURE" means, at any time, the aggregate
principal amount of all Swingline Loans outstanding at such time. The Swingline
Exposure of any Lender at any time shall be its Applicable Percentage of the
total Swingline Exposure at such time.
"SWINGLINE LENDER" means The Chase Manhattan Bank, in its
capacity as lender of Swingline Loans hereunder.
"SWINGLINE LOAN" means a Loan made pursuant to Section 2.04.
"TAXES" means any and all present or future taxes, levies,
imposts, duties, deductions, charges or withholdings imposed by any
Governmental Authority.
"TERM LOANS" means Tranche A Term Loans and Tranche B Term
Loans.
"THREE-MONTH SECONDARY CD RATE" means, for any day, the
secondary market rate for three-month certificates of deposit reported as being
in effect on such day (or, if such day is not a Business Day, the next
preceding Business Day) by the Board through the public information telephone
line of the Federal Reserve Bank of New York (which rate will, under the
current practices of the Board, be published in Federal Reserve Statistical
Release H.15(519) during the week following such day) or, if such rate is not
so reported on such day or such next preceding Business Day, the average of the
secondary market quotations for three-month certificates of deposit of major
money center banks in New York City received at approximately 10:00 a.m., New
York City time, on such day (or, if such day is not a Business Day, on the next
preceding Business Day) by the Administrative Agent from three negotiable
certificate of deposit dealers of recognized standing selected by it.
"TOTAL ASSETS" means, as of any date of determination, the
total consolidated assets of the Borrower and the Restricted Subsidiaries as of
the end of the most recent fiscal quarter for which financial statements have
been delivered pursuant to clause (a) or (b) of Section 5.01, determined on a
consolidated basis in accordance with GAAP.
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"TOTAL DEBT" means, as of any date of determination, the
aggregate principal amount of Indebtedness (excluding Indebtedness consisting
of contingent liabilities in respect of undrawn letters of credit) of the
Borrower and the Restricted Subsidiaries outstanding as of such date,
determined on a consolidated basis in accordance with GAAP.
"TOTAL SENIOR DEBT" means, as of any date of determination,
(a) Total Debt as of such date minus (b) the portion of Total Debt as of such
date represented by the Subordinated Debt and Existing Notes.
"TRANCHE A COMMITMENT" means, with respect to each Lender,
the commitment, if any, of such Lender to make a Tranche A Term Loan hereunder
on the Effective Date, expressed as an amount representing the maximum
principal amount of the Tranche A Term Loan to be made by such Lender
hereunder, as such commitment may be (a) reduced from time to time pursuant to
Section 2.08 and (b) reduced or increased from time to time pursuant to
assignments by or to such Lender pursuant to Section 9.04. The initial amount
of each Lender's Tranche A Commitment is set forth on Schedule 2.01, or in the
Assignment and Acceptance pursuant to which such Lender shall have assumed its
Tranche A Commitment, as applicable. The initial aggregate amount of the
Lenders' Tranche A Commitments is $100,000,000.
"TRANCHE A LENDER" means a Lender with a Tranche A Commitment
or an outstanding Tranche A Term Loan.
"TRANCHE A MATURITY DATE" means April 1, 2006.
"TRANCHE A TERM LOAN" means a Loan made pursuant to clause
(a) of Section 2.01.
"TRANCHE B COMMITMENT" means, with respect to each Lender,
the commitment, if any, of such Lender to make a Tranche B Term Loan hereunder
on the Effective Date, expressed as an amount representing the maximum
principal amount of the Tranche B Term Loan to be made by such Lender
hereunder, as such commitment may be (a) reduced from time to time pursuant to
Section 2.08 and (b) reduced or increased from time to time pursuant to
assignments by or to such Lender pursuant to Section 9.04. The initial amount
of each Lender's Tranche B Commitment is set forth on Schedule 2.01, or in the
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Assignment and Acceptance pursuant to which such Lender shall have assumed its
Tranche A Commitment, as applicable. The initial aggregate amount of the
Lenders' Tranche B Commitments is $240,000,000.
"TRANCHE B LENDER" means a Lender with a Tranche B Commitment
or an outstanding Tranche B Term Loan.
"TRANCHE B MATURITY DATE" means April 1, 2007.
"TRANCHE B TERM LOAN" means a Loan made pursuant to clause
(b) of Section 2.01.
"TRANSACTION COSTS" means any amounts paid or payable by
Holdings or the Borrower in respect of financing fees, investment banking and
consulting fees, accounting and legal fees, printing costs and any similar fees
and expenses, in each case incurred in connection with the Transactions.
"TRANSACTIONS" means the Acquisition, the Debt Tender Offer
and the Financing Transactions.
"TYPE", when used in reference to any Loan or Borrowing,
refers to whether the rate of interest on such Loan, or on the Loans comprising
such Borrowing, is determined by reference to the Adjusted LIBO Rate or the
Alternate Base Rate.
"UNRESTRICTED SUBSIDIARY" means (a) any Subsidiary of the
Borrower that shall have been designated an Unrestricted Subsidiary by the
Borrower in the manner provided below and (b) any Subsidiary of an Unrestricted
Subsidiary. The Borrower may designate any Subsidiary (including any newly
acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary if (i)
neither such Subsidiary nor any of its Subsidiaries owns any Equity Interests
or Indebtedness of, or holds any Lien on any property of, Holdings, the
Borrower or any other Restricted Subsidiary, (ii) after giving effect to such
designation, the Borrower shall be in compliance with clause (d) of Section
6.04 (it being understood that, for purposes of determining such compliance,
all investments made by Loan Parties in, loans or advances made by Loan Parties
to and Guarantees made by Loan Parties of Indebtedness of any Subsidiary so
designated, shall be deemed to be investments, loans, advances and Guarantees
in, to or on behalf of an Unrestricted Subsidiary), (iii) after giving effect
to such designation, the Borrower and the Restricted Subsidiaries shall be in
compliance on a PRO FORMA basis with the covenants contained in Sections 6.12,
6.13, 6.14, 6.15 and 6.16 recomputed as at the last day of the most recently
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completed fiscal quarter of the Borrower for which financial statements are
available, as if such designation had occurred on the first day of each
relevant period for testing such compliance and (iv) no Default shall have
occurred and be continuing or would result therefrom. The Borrower may
designate any Unrestricted Subsidiary to be a Restricted Subsidiary if (i) no
Default shall have occurred and be continuing or would result therefrom and
(ii) after giving effect to such designation, the Borrower and the Restricted
Subsidiaries are in compliance on a PRO FORMA basis with the covenants
contained in Sections 6.12, 6.13, 6.14, 6.15 and 6.16 recomputed as at the last
day of the most recently completed fiscal quarter of the Borrower for which
financial statements are available, as if such designation had occurred on the
first day of each relevant period for testing such compliance. The Borrower
shall promptly notify the Administrative Agent in writing of any such
designation (and the Administrative Agent shall notify the Lenders) and shall
deliver to the Administrative Agent a certificate signed by a Financial Officer
of the Borrower certifying that such designation complied with the foregoing
provisions together with reasonably detailed calculations demonstrating
satisfaction of the requirement set forth in clause (iii) of the second
sentence of this definition or in clause (ii) of the third sentence of this
definition, as applicable.
"WITHDRAWAL LIABILITY" means liability to a Multiemployer
Plan as a result of a complete or partial withdrawal from such Multiemployer
Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. CLASSIFICATION OF LOANS AND BORROWINGS. For
purposes of this Agreement, Loans may be classified and referred to by Class
(E.G., a "Revolving Loan") or by Type (E.G., a "Eurodollar Loan") or by Class
and Type (E.G., a "Eurodollar Revolving Loan"). Borrowings also may be
classified and referred to by Class (E.G., a "Revolving Borrowing") or by Type
(E.G., a "Eurodollar Borrowing") or by Class and Type (E.G., a "Eurodollar
Revolving Borrowing").
SECTION 1.03. TERMS GENERALLY. The definitions of terms
herein shall apply equally to the singular and plural forms of the terms
defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The words "include",
"includes" and "including" shall be deemed to be followed by the phrase
"without limitation". The word "will" shall be construed to have the same
meaning and effect as the word "shall". Unless the context requires otherwise
(a) any definition of or reference to any agreement, instrument or other
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document herein shall be construed as referring to such agreement, instrument
or other document as from time to time amended, supplemented or otherwise
modified (subject to any restrictions on such amendments, supplements or
modifications set forth herein), (b) any reference herein to any Person shall
be construed to include such Person's successors and assigns, (c) the words
"herein", "hereof" and "hereunder", and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular
provision hereof, (d) all references herein to Articles, Sections, Exhibits and
Schedules shall be construed to refer to Articles and Sections of, and Exhibits
and Schedules to, this Agreement and (e) the words "asset" and "property" shall
be construed to have the same meaning and effect and to refer to any and all
tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.
SECTION 1.04. ACCOUNTING TERMS; GAAP; TREATMENT OF
UNRESTRICTED SUBSIDIARIES. (a) Except as otherwise expressly provided herein,
all terms of an accounting or financial nature shall be construed in accordance
with GAAP, as in effect from time to time; PROVIDED that, if the Borrower
notifies the Administrative Agent that the Borrower requests an amendment to
any provision hereof to eliminate the effect of any change occurring after the
date hereof in GAAP or in the application thereof on the operation of such
provision (or if the Administrative Agent notifies the Borrower that the
Required Lenders request an amendment to any provision hereof for such
purpose), regardless of whether any such notice is given before or after such
change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.
(b) Except as otherwise expressly provided herein, all
accounting and financial calculations and determinations hereunder shall be
made without consolidating the accounts of Unrestricted Subsidiaries with those
of the Borrower or any Restricted Subsidiary, notwithstanding that such
treatment is inconsistent with GAAP.
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ARTICLE II
THE CREDITS
SECTION 2.01. COMMITMENTS. Subject to the terms and
conditions set forth herein, each Lender agrees (a) to make a Tranche A Term
Loan to the Borrower on the Effective Date in a principal amount not exceeding
its Tranche A Commitment, (b) to make a Tranche B Term Loan to the Borrower on
the Effective Date in a principal amount not exceeding its Tranche B Commitment
and (c) to make Revolving Loans to the Borrower from time to time during the
Revolving Availability Period in an aggregate principal amount that will not
result in such Lender's Revolving Exposure exceeding such Lender's Revolving
Commitment. Within the foregoing limits and subject to the terms and conditions
set forth herein, the Borrower may borrow, prepay and reborrow Revolving Loans.
Amounts repaid in respect of Term Loans may not be reborrowed.
SECTION 2.02. LOANS AND BORROWINGS. (a) Each Loan (other than
a Swingline Loan) shall be made as part of a Borrowing consisting of Loans of
the same Class and Type made by the Lenders ratably in accordance with their
respective Commitments of the applicable Class. The failure of any Lender to
make any Loan required to be made by it shall not relieve any other Lender of
its obligations hereunder; PROVIDED that the Commitments of the Lenders are
several and no Lender shall be responsible for any other Lender's failure to
make Loans as required.
(b) Subject to Section 2.14, each Revolving Borrowing and
Term Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as
the Borrower may request in accordance herewith; PROVIDED that all Borrowings
made on the Effective Date must be made as ABR Borrowings. Each Swingline Loan
shall be an ABR Loan. Each Lender at its option may make any Eurodollar 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) At the commencement of each Interest Period for any
Eurodollar Borrowing, such Borrowing shall be in an aggregate amount that is an
integral multiple of $100,000 and not less than $10,000,000. At the time that
each ABR Revolving Borrowing is made, such Borrowing shall be in an aggregate
amount that is an integral multiple of $100,000 and not less than $1,000,000;
PROVIDED that an ABR Revolving Borrowing may be in an aggregate amount that is
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equal to the entire unused balance of the total Revolving Commitments or that
is required to finance the reimbursement of an LC Disbursement as contemplated
by Section 2.05(e). Each Swingline Loan shall be in an amount that is not less
than $100,000. Borrowings of more than one Type and Class may be outstanding at
the same time; PROVIDED that there shall not at any time be more than a total
of ten Eurodollar Borrowings of any Class outstanding.
(d) Notwithstanding any other provision of this Agreement,
the Borrower shall not be entitled to request, or to elect to convert or
continue, any Borrowing if the Interest Period requested with respect thereto
would end after the Revolving Maturity Date, Tranche A Maturity Date or Tranche
B Maturity Date, as applicable.
SECTION 2.03. REQUESTS FOR BORROWINGS. To request a Revolving
Borrowing or Term Borrowing, the Borrower shall notify the Administrative Agent
of such request by telephone (a) in the case of a Eurodollar Borrowing, not
later than 11:00 a.m., New York City time, three Business Days before the date
of the proposed Borrowing or (b) in the case of an ABR Borrowing, not later
than 11:00 a.m., New York City time, one Business Day before the date of the
proposed Borrowing; PROVIDED that any such notice of an ABR Revolving Borrowing
to finance the reimbursement of an LC Disbursement as contemplated by Section
2.05(e) may be given not later than 10:00 a.m., New York City time, on the date
of the proposed Borrowing. Each such telephonic Borrowing Request shall be
irrevocable and shall be confirmed promptly by hand delivery or telecopy to the
Administrative Agent of a written Borrowing Request in a form approved by the
Administrative Agent and signed by the Borrower. Each such telephonic and
written Borrowing Request shall specify the following information in compliance
with Section 2.02:
(i) whether the requested Borrowing is to be a Revolving
Borrowing, Tranche A Term Borrowing or Tranche B Term Borrowing;
(ii) the aggregate amount of such Borrowing;
(iii) the date of such Borrowing, which shall be a Business
Day;
(iv) whether such Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing;
(v) in the case of a Eurodollar Borrowing, the initial
Interest Period to be applicable thereto, which shall be a period
contemplated by the definition of the term "Interest Period"; and
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(vi) the location and number of the Borrower's account to
which funds are to be disbursed, which shall comply with the
requirements of Section 2.06.
If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested Eurodollar Revolving Borrowing, then the Borrower
shall be deemed to have selected an Interest Period of one month's duration.
Promptly following receipt of a Borrowing Request in accordance with this
Section, the Administrative Agent shall advise each Lender of the details
thereof and of the amount of such Lender's Loan to be made as part of the
requested Borrowing.
SECTION 2.04. SWINGLINE LOANS. (a) Subject to the terms and
conditions set forth herein, the Swingline Lender agrees to make Swingline
Loans to the Borrower from time to time during the Revolving Availability
Period, in an aggregate principal amount at any time outstanding that will not
result in (i) the aggregate principal amount of outstanding Swingline Loans
exceeding $5,000,000 or (ii) the sum of the total Revolving Exposures exceeding
the total Revolving Commitments; PROVIDED that the Swingline Lender shall not
be required to make a Swingline Loan to refinance an outstanding Swingline
Loan. Within the foregoing limits and subject to the terms and conditions set
forth herein, the Borrower may borrow, prepay and reborrow Swingline Loans.
(b) To request a Swingline Loan, the Borrower shall notify
the Administrative Agent of such request by telephone (confirmed by telecopy),
not later than 12:00 noon, New York City time, on the day of a proposed
Swingline Loan. Each such notice shall be irrevocable and shall specify the
requested date (which shall be a Business Day) and amount of the requested
Swingline Loan. The Administrative Agent will promptly advise the Swingline
Lender of any such notice received from the Borrower. The Swingline Lender
shall make each Swingline Loan available to the Borrower by means of a credit
to the general deposit account of the Borrower with the Swingline Lender (or,
in the case of a Swingline Loan made to finance the reimbursement of an LC
Disbursement as provided in Section 2.05(e), by remittance to the Issuing Bank)
by 3:00 p.m., New York City time, on the requested date of such Swingline Loan.
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(c) The Swingline Lender may by written notice given to the
Administrative Agent not later than 12:00 noon, New York City time, on any
Business Day require the Revolving Lenders to acquire participations on such
Business Day in all or a portion of the Swingline Loans outstanding. Such
notice shall specify the aggregate amount of Swingline Loans in which Revolving
Lenders will participate. Promptly upon receipt of such notice, the
Administrative Agent will give notice thereof to each Revolving Lender,
specifying in such notice such Lender's Applicable Percentage of such Swingline
Loan or Loans. Each Revolving Lender hereby absolutely and unconditionally
agrees, upon receipt of notice as provided above, to pay to the Administrative
Agent, for the account of the Swingline Lender, such Lender's Applicable
Percentage of such Swingline Loan or Loans. Each Revolving Lender acknowledges
and agrees that its obligation to acquire participations in Swingline Loans
pursuant to this paragraph is absolute and unconditional and shall not be
affected by any circumstance whatsoever, including the occurrence and
continuance of a Default or reduction or termination of the Commitments, and
that each such payment shall be made without any offset, abatement, withholding
or reduction whatsoever. Each Revolving Lender shall comply with its obligation
under this paragraph by wire transfer of immediately available funds, in the
same manner as provided in Section 2.06 with respect to Loans made by such
Lender (and Section 2.06 shall apply, MUTATIS MUTANDIS, to the payment
obligations of the Revolving Lenders), and the Administrative Agent shall
promptly pay to the Swingline Lender the amounts so received by it from the
Revolving Lenders. The Administrative Agent shall notify the Borrower of any
participations in any Swingline Loan acquired pursuant to this paragraph, and
thereafter payments in respect of such Swingline Loan shall be made to the
Administrative Agent and not to the Swingline Lender. Any amounts received by
the Swingline Lender from the Borrower (or other party on behalf of the
Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender
of the proceeds of a sale of participations therein shall be promptly remitted
to the Administrative Agent; any such amounts received by the Administrative
Agent shall be promptly remitted by the Administrative Agent to the Revolving
Lenders that shall have made their payments pursuant to this paragraph and to
the Swingline Lender, as their interests may appear. The purchase of
participations in a Swingline Loan pursuant to this paragraph shall not relieve
the Borrower of any default in the payment thereof. Notwithstanding the
foregoing, a Revolving Lender shall not have any obligation to acquire a
participation in a Swingline Loan pursuant to this paragraph if an Event of
Default shall have occurred and be continuing at the time such Swingline Loan
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was made and such Lender shall have notified the Swingline Lender in writing,
at least one Business Day prior to the time such Swingline Loan was made, that
such Event of Default has occurred and that such Lender will not acquire
participations in Swingline Loans made while such Event of Default is
continuing.
SECTION 2.05. LETTERS OF CREDIT. (a) GENERAL. Subject to the
terms and conditions set forth herein, the Borrower may request the issuance of
Letters of Credit for its own account, in a form reasonably acceptable to the
Administrative Agent and the Issuing Bank, at any time and from time to time
during the Revolving Availability Period. In the event of any inconsistency
between the terms and conditions of this Agreement and the terms and conditions
of any form of letter of credit application or other agreement submitted by the
Borrower to, or entered into by the Borrower with, the Issuing Bank relating to
any Letter of Credit, the terms and conditions of this Agreement shall control.
(b) NOTICE OF ISSUANCE, AMENDMENT, RENEWAL, EXTENSION;
CERTAIN CONDITIONS. To request the issuance of a Letter of Credit (or the
amendment, renewal or extension of an outstanding Letter of Credit), the
Borrower shall hand deliver or telecopy (or transmit by electronic
communication, if arrangements for doing so have been approved by the Issuing
Bank) to the Issuing Bank and the Administrative Agent (reasonably in advance
of the requested date of issuance, amendment, renewal or extension) a notice
requesting the issuance of a Letter of Credit, or identifying the Letter of
Credit to be amended, renewed or extended, and specifying the date of issuance,
amendment, renewal or extension (which shall be a Business Day), the date on
which such Letter of Credit is to expire (which shall comply with paragraph (c)
of this Section), the amount of such Letter of Credit, the name and address of
the beneficiary thereof and such other information as shall be necessary to
prepare, amend, renew or extend such Letter of Credit. If requested by the
Issuing Bank, the Borrower also shall submit a letter of credit application on
the Issuing Bank's standard form in connection with any request for a Letter of
Credit. A Letter of Credit shall be issued, amended, renewed or extended only
if (and upon issuance, amendment, renewal or extension of each Letter of Credit
the Borrower shall be deemed to represent and warrant that), after giving
effect to such issuance, amendment, renewal or extension (i) the LC Exposure
shall not exceed $5,000,000 and (ii) the total Revolving Exposures shall not
exceed the total Revolving Commitments.
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(c) EXPIRATION DATE. Each Letter of Credit shall expire at or
prior to the close of business on the earlier of (i) the date one year after
the date of the issuance of such Letter of Credit (or, in the case of any
renewal or extension thereof, one year after such renewal or extension) and
(ii) the date that is five Business Days prior to the Revolving Maturity Date.
(d) PARTICIPATIONS. By the issuance of a Letter of Credit (or
an amendment to a Letter of Credit increasing the amount thereof) and without
any further action on the part of the Issuing Bank or the Lenders, the Issuing
Bank hereby grants to each Revolving Lender, and each Revolving Lender hereby
acquires from the Issuing Bank, a participation in such Letter of Credit equal
to such Lender's Applicable Percentage of the aggregate amount available to be
drawn under such Letter of Credit. In consideration and in furtherance of the
foregoing, each Revolving Lender hereby absolutely and unconditionally agrees
to pay to the Administrative Agent, for the account of the Issuing Bank, such
Lender's Applicable Percentage of each LC Disbursement made by the Issuing Bank
and not reimbursed by the Borrower on the date due as provided in paragraph (e)
of this Section, or of any reimbursement payment required to be refunded to the
Borrower for any reason. Each Lender acknowledges and agrees that its
obligation to acquire participations pursuant to this paragraph in respect of
Letters of Credit is absolute and unconditional and shall not be affected by
any circumstance whatsoever, including any amendment, renewal or extension of
any Letter of Credit or the occurrence and continuance of a Default or
reduction or termination of the Commitments, and that each such payment shall
be made without any offset, abatement, withholding or reduction whatsoever.
(e) REIMBURSEMENT. If the Issuing Bank shall make any LC
Disbursement in respect of a Letter of Credit, the Borrower shall reimburse
such LC Disbursement by paying to the Administrative Agent an amount equal to
such LC Disbursement not later than 12:00 noon, New York City time, on the date
that such LC Disbursement is made, if the Borrower shall have received notice
of such LC Disbursement prior to 10:00 a.m., New York City time, on such date,
or, if such notice has not been received by the Borrower prior to such time on
such date, then not later than 12:00 noon, New York City time, on the Business
Day immediately following the day that the Borrower receives such notice;
PROVIDED that the Borrower may, subject to the conditions to borrowing set
forth herein, request in accordance with Section 2.03 or 2.04 that such payment
be financed with an ABR Revolving Borrowing or Swingline Loan in an equivalent
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amount and, to the extent so financed, the Borrower's obligation to make such
payment shall be discharged and replaced by the resulting ABR Revolving
Borrowing or Swingline Loan. If the Borrower fails to make such payment when
due, the Administrative Agent shall notify each Revolving Lender of the
applicable LC Disbursement, the payment then due from the Borrower in respect
thereof and such Lender's Applicable Percentage thereof. Promptly following
receipt of such notice, each Revolving Lender shall pay to the Administrative
Agent its Applicable Percentage of the payment then due from the Borrower, in
the same manner as provided in Section 2.06 with respect to Loans made by such
Lender (and Section 2.06 shall apply, MUTATIS mutandis, to the payment
obligations of the Revolving Lenders), and the Administrative Agent shall
promptly pay to the Issuing Bank the amounts so received by it from the
Revolving Lenders. Promptly following receipt by the Administrative Agent of
any payment from the Borrower pursuant to this paragraph, the Administrative
Agent shall distribute such payment to the Issuing Bank or, to the extent that
Revolving Lenders have made payments pursuant to this paragraph to reimburse
the Issuing Bank, then to such Lenders and the Issuing Bank as their interests
may appear. Any payment made by a Revolving Lender pursuant to this paragraph
to reimburse the Issuing Bank for any LC Disbursement (other than the funding
of ABR Revolving Loans or a Swingline Loan as contemplated above) shall not
constitute a Loan and shall not relieve the Borrower of its obligation to
reimburse such LC Disbursement.
(f) OBLIGATIONS ABSOLUTE. The Borrower's obligation to
reimburse LC Disbursements as provided in paragraph (e) of this Section shall
be absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability of
any Letter of Credit or this Agreement, or any term or provision therein, (ii)
any draft or other document presented under a Letter of Credit proving to be
forged, fraudulent or invalid in any respect or any statement therein being
untrue or inaccurate in any respect, (iii) payment by the Issuing Bank under a
Letter of Credit against presentation of a draft or other document that does
not comply with the terms of such Letter of Credit, or (iv) any other event or
circumstance whatsoever, whether or not similar to any of the foregoing, that
might, but for the provisions of this Section, constitute a legal or equitable
discharge of, or provide a right of setoff against, the Borrower's obligations
hereunder. Neither the Administrative Agent, the Lenders nor the Issuing Bank,
nor any of their Related Parties, shall have any liability or responsibility by
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reason of or in connection with the issuance or transfer of any Letter of
Credit or any payment or failure to make any payment thereunder (irrespective
of any of the circumstances referred to in the preceding sentence), or any
error, omission, interruption, loss or delay in transmission or delivery of any
draft, notice or other communication under or relating to any Letter of Credit
(including any document required to make a drawing thereunder), any error in
interpretation of technical terms or any consequence arising from causes beyond
the control of the Issuing Bank; PROVIDED that the foregoing shall not be
construed to excuse the Issuing Bank from liability to the Borrower to the
extent of any direct damages (as opposed to consequential damages, claims in
respect of which are hereby waived by the Borrower to the extent permitted by
applicable law) suffered by the Borrower that are caused by the Issuing Bank's
failure to exercise care when determining whether drafts and other documents
presented under a Letter of Credit comply with the terms thereof. The parties
hereto expressly agree that, in the absence of gross negligence or wilful
misconduct on the part of the Issuing Bank (as finally determined by a court of
competent jurisdiction), the Issuing Bank shall be deemed to have exercised
care in each such determination. In furtherance of the foregoing and without
limiting the generality thereof, the parties agree that, with respect to
documents presented which appear on their face to be in substantial compliance
with the terms of a Letter of Credit, the Issuing Bank may, in its sole
discretion, either accept and make payment upon such documents without
responsibility for further investigation, regardless of any notice or
information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such
Letter of Credit.
(g) DISBURSEMENT PROCEDURES. The Issuing Bank shall, promptly
following its receipt thereof, examine all documents purporting to represent a
demand for payment under a Letter of Credit. The Issuing Bank shall promptly
notify the Administrative Agent and the Borrower by telephone (confirmed by
telecopy) of such demand for payment and whether the Issuing Bank has made or
will make an LC Disbursement thereunder; PROVIDED that any failure to give or
delay in giving such notice shall not relieve the Borrower of its obligation to
reimburse the Issuing Bank and the Revolving Lenders with respect to any such
LC Disbursement.
(h) INTERIM INTEREST. If the Issuing Bank shall make any LC
Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in
full on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such LC Disbursement is
made to but excluding the date that the Borrower reimburses such LC
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Disbursement, at the rate per annum then applicable to ABR Revolving Loans;
PROVIDED that, if the Borrower fails to reimburse such LC Disbursement when due
pursuant to paragraph (e) of this Section, then Section 2.13(c) shall apply.
Interest accrued pursuant to this paragraph shall be for the account of the
Issuing Bank, except that interest accrued on and after the date of payment by
any Revolving Lender pursuant to paragraph (e) of this Section to reimburse the
Issuing Bank shall be for the account of such Lender to the extent of such
payment.
(i) REPLACEMENT OF THE ISSUING BANK. The Issuing Bank may be
replaced at any time by written agreement among the Borrower, the
Administrative Agent, the replaced Issuing Bank and the successor Issuing Bank.
The Administrative Agent shall notify the Lenders of any such replacement of
the Issuing Bank. At the time any such replacement shall become effective, the
Borrower shall pay all unpaid fees accrued for the account of the replaced
Issuing Bank pursuant to Section 2.12(b). From and after the effective date of
any such replacement, (i) the successor Issuing Bank shall have all the rights
and obligations of the Issuing Bank under this Agreement with respect to
Letters of Credit to be issued thereafter and (ii) references herein to the
term "Issuing Bank" shall be deemed to refer to such successor or to any
previous Issuing Bank, or to such successor and all previous Issuing Banks, as
the context shall require. After the replacement of an Issuing Bank hereunder,
the replaced Issuing Bank shall remain a party hereto and shall continue to
have all the rights and obligations of an Issuing Bank under this Agreement
with respect to Letters of Credit issued by it prior to such replacement, but
shall not be required to issue additional Letters of Credit.
(j) CASH COLLATERALIZATION. If any Event of Default shall
occur and be continuing, on the Business Day that the Borrower receives notice
from the Administrative Agent or the Required Lenders (or, if the maturity of
the Loans has been accelerated, Revolving Lenders with LC Exposure representing
greater than 50% of the total LC Exposure) demanding the deposit of cash
collateral pursuant to this paragraph, the Borrower shall deposit in an account
with the Administrative Agent, in the name of the Administrative Agent and for
the benefit of the Lenders, an amount in cash equal to the LC Exposure as of
such date plus any accrued and unpaid interest thereon; PROVIDED that the
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obligation to deposit such cash collateral shall become effective immediately,
and such deposit shall become immediately due and payable, without demand or
other notice of any kind, upon the occurrence of any Event of Default with
respect to the Borrower described in clause (h) or (i) of Article VII. Each
such deposit shall be held by the Administrative Agent as collateral for the
payment and performance of the obligations of the Borrower under this
Agreement. The Administrative Agent shall have exclusive dominion and control,
including the exclusive right of withdrawal, over such account. Other than any
interest earned on the investment of such deposits, which investments shall be
made at the option and sole discretion of the Administrative Agent and at the
Borrower's risk and expense, such deposits shall not bear interest. Interest or
profits, if any, on such investments shall accumulate in such account. Moneys
in such account shall be applied by the Administrative Agent to reimburse the
Issuing Bank for LC Disbursements for which it has not been reimbursed and, to
the extent not so applied, shall be held for the satisfaction of the
reimbursement obligations of the Borrower for the LC Exposure at such time or,
if the maturity of the Loans has been accelerated (but subject to the consent
of Revolving Lenders with LC Exposure representing greater than 50% of the
total LC Exposure), be applied to satisfy other obligations of the Borrower
under this Agreement. If the Borrower is required to provide an amount of cash
collateral hereunder as a result of the occurrence of an Event of Default, such
amount (to the extent not applied as aforesaid) shall be returned to the
Borrower within three Business Days after all Events of Default have been cured
or waived.
SECTION 2.06. FUNDING OF BORROWINGS. (a) Each Lender shall
make each Loan to be made by it hereunder on the proposed date thereof by wire
transfer of immediately available funds by 12:00 noon, New York City time, to
the account of the Administrative Agent most recently designated by it for such
purpose by notice to the Lenders; PROVIDED that Swingline Loans shall be made
as provided in Section 2.04. The Administrative Agent will make such Loans
available to the Borrower by promptly crediting the amounts so received, in
like funds, to an account of the Borrower maintained with the Administrative
Agent in New York City and designated by the Borrower in the applicable
Borrowing Request; PROVIDED that ABR Revolving Loans made to finance the
reimbursement of an LC Disbursement as provided in Section 2.05(e) shall be
remitted by the Administrative Agent to the Issuing Bank.
(b) Unless the Administrative Agent shall have received
notice from a Lender prior to the proposed date of any Borrowing that such
Lender will not make available to the Administrative Agent such Lender's share
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of such Borrowing, the Administrative Agent may assume that such Lender has
made such share available on such date in accordance with paragraph (a) of this
Section and may, in reliance upon such assumption, make available to the
Borrower a corresponding amount. In such event, if a Lender has not in fact
made its share of the applicable Borrowing available to the Administrative
Agent, then the applicable Lender and the Borrower severally agree to pay to
the Administrative Agent forthwith on demand such corresponding amount with
interest thereon, for each day from and including the date such amount is made
available to the Borrower to but excluding the date of payment to the
Administrative Agent, at (i) in the case of such Lender, the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative Agent
in accordance with banking industry rules on interbank compensation or (ii) in
the case of the Borrower, the interest rate applicable to ABR Loans. If such
Lender pays such amount to the Administrative Agent, then such amount shall
constitute such Lender's Loan included in such Borrowing.
SECTION 2.07. INTEREST ELECTIONS. (a) Each Revolving
Borrowing and Term Borrowing initially shall be of the Type specified in the
applicable Borrowing Request and, in the case of a Eurodollar Borrowing, shall
have an initial Interest Period as specified in such Borrowing Request.
Thereafter, the Borrower may elect to convert such Borrowing to a different
Type or to continue such Borrowing and, in the case of a Eurodollar Borrowing,
may elect Interest Periods therefor, all as provided in this Section. The
Borrower may elect different options with respect to different portions of the
affected Borrowing, in which case each such portion shall be allocated ratably
among the Lenders holding the Loans comprising such Borrowing, and the Loans
comprising each such portion shall be considered a separate Borrowing. This
Section shall not apply to Swingline Borrowings, which may not be converted or
continued.
(b) To make an election pursuant to this Section, the
Borrower shall notify the Administrative Agent of such election by telephone by
the time that a Borrowing Request would be required under Section 2.03 if the
Borrower were requesting a Revolving Borrowing of the Type resulting from such
election to be made on the effective date of such election. Each such
telephonic Interest Election Request shall be irrevocable and shall be
confirmed promptly by hand delivery or telecopy to the Administrative Agent of
a written Interest Election Request in a form approved by the Administrative
Agent and signed by the Borrower.
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(c) Each telephonic and written Interest Election Request
shall specify the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request
applies and, if different options are being elected with respect to
different portions thereof, the portions thereof to be allocated to
each resulting Borrowing (in which case the information to be
specified pursuant to clauses (iii) and (iv) below shall be specified
for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR
Borrowing or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing,
the Interest Period to be applicable thereto after giving effect to
such election, which shall be a period contemplated by the definition
of the term "Interest Period".
If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.
(d) Promptly following receipt of an Interest Election
Request, the Administrative Agent shall advise each Lender of the details
thereof and of such Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest
Election Request with respect to a Eurodollar Borrowing prior to the end of the
Interest Period applicable thereto, then, unless such Borrowing is repaid as
provided herein, at the end of such Interest Period such Borrowing shall be
converted to an ABR Borrowing. Notwithstanding any contrary provision hereof,
if an Event of Default has occurred and is continuing and the Administrative
Agent, at the request of the Required Lenders, so notifies the Borrower, then,
so long as an Event of Default is continuing (i) no outstanding Borrowing may
be converted to or continued as a Eurodollar Borrowing and (ii) unless repaid,
each Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of
the Interest Period applicable thereto.
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SECTION 2.08. TERMINATION AND REDUCTION OF COMMITMENTS. (a)
Unless previously terminated, (i) the Tranche A Commitments and Tranche B
Commitments shall terminate at 5:00 p.m., New York City time, on the Effective
Date and (ii) the Revolving Commitments shall terminate on the Revolving
Maturity Date.
(b) The Borrower may at any time terminate, or from time to
time reduce, the Commitments of any Class; PROVIDED that (i) each reduction of
the Commitments of any Class shall be in an amount that is an integral multiple
of $1,000,000 and not less than $10,000,000 and (ii) the Borrower shall not
terminate or reduce the Revolving Commitments if, after giving effect to any
concurrent prepayment of the Revolving Loans in accordance with Section 2.11,
the sum of the Revolving Exposures would exceed the total Revolving
Commitments.
(c) The Borrower shall notify the Administrative Agent of any
election to terminate or reduce the Commitments under paragraph (b) of this
Section at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the Lenders of the contents thereof. Each notice delivered by the
Borrower pursuant to this Section shall be irrevocable; PROVIDED that a notice
of termination of the Revolving Commitments delivered by the Borrower may state
that such notice is conditioned upon the effectiveness of other credit
facilities, in which case such notice may be revoked by the Borrower (by notice
to the Administrative Agent on or prior to the specified effective date) if
such condition is not satisfied. Any termination or reduction of the
Commitments of any Class shall be permanent. Each reduction of the Commitments
of any Class shall be made ratably among the Lenders in accordance with their
respective Commitments of such Class.
SECTION 2.09. REPAYMENT OF LOANS; EVIDENCE OF DEBT. (a) The
Borrower hereby unconditionally promises to pay (i) to the Administrative Agent
for the account of each Lender the then unpaid principal amount of each
Revolving Loan of such Lender on the Revolving Maturity Date, (ii) to the
Administrative Agent for the account of each Lender the then unpaid principal
amount of each Term Loan of such Lender as provided in Section 2.10 and (iii)
to the Swingline Lender the then unpaid principal amount of each Swingline Loan
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on the Revolving Maturity Date; PROVIDED that on each date that a Revolving
Borrowing is made, the Borrower shall repay all Swingline Loans that were
outstanding on the date such Borrowing was requested.
(b) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of the Borrower to
such Lender resulting from each Loan made by such Lender, including the amounts
of principal and interest payable and paid to such Lender from time to time
hereunder.
(c) The Administrative Agent shall maintain accounts in which
it shall record (i) the amount of each Loan made hereunder, the Class and Type
thereof and the Interest Period applicable thereto, (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) the amount of any sum received by
the Administrative Agent hereunder for the account of the Lenders and each
Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to
paragraph (b) or (c) of this Section shall be PRIMA FACIE evidence of the
existence and amounts of the obligations recorded therein; PROVIDED that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Loans of any Class made by it
be evidenced by a promissory note. In such event, the Borrower shall prepare,
execute and deliver to such Lender a promissory note payable to the order of
such Lender (or, if requested by such Lender, to such Lender and its registered
assigns) and in a form approved by the Administrative Agent. Thereafter, the
Loans evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 9.04) be represented by one or
more promissory notes in such form payable to the order of the payee named
therein (or, if such promissory note is a registered note, to such payee and
its registered assigns).
SECTION 2.10. AMORTIZATION OF TERM LOANS. (a) Subject to
adjustment pursuant to paragraph (d) of this Section, the Borrower shall repay
Tranche A Term Borrowings on each date set forth below in the aggregate
principal amount set forth opposite such date:
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DATE AMOUNT
---- ------
July 1, 2001 $ 2,500,000
October 1, 2001 $ 2,500,000
January 2, 2002 $ 2,500,000
April 1, 2002 $ 2,500,000
July 1, 2002 $ 3,750,000
October 1, 2002 $ 3,750,000
January 2, 2003 $ 3,750,000
April 1, 2003 $ 3,750,000
July 1, 2003 $ 5,000,000
October 1, 2003 $ 5,000,000
January 2, 2004 $ 5,000,000
April 1, 2004 $ 5,000,000
July 1, 2004 $6,250,000
October 1, 2004 $6,250,000
January 2, 2005 $6,250,000
April 1, 2005 $6,250,000
July 1, 2005 $7,500,000
October 1, 2005 $7,500,000
January 2, 2006 $7,500,000
April 1, 2006 $7,500,000
(b) Subject to adjustment pursuant to paragraph (d) of this
Section, the Borrower shall repay Tranche B Term Borrowings on each date set
forth below in the aggregate principal amount set forth opposite such date:
DATE AMOUNT
---- ------
July 1, 2001 $ 600,000
October 1, 2001 $ 600,000
January 2, 2002 $ 600,000
April 1, 2002 $ 600,000
July 1, 2002 $ 600,000
October 1, 2002 $ 600,000
January 2, 2003 $ 600,000
April 1, 2003 $ 600,000
July 1, 2003 $ 600,000
October 1, 2003 $ 600,000
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January 2, 2004 $ 600,000
April 1, 2004 $ 600,000
July 1, 2004 $ 600,000
October 1, 2004 $ 600,000
January 2, 2005 $ 600,000
April 1, 2005 $ 600,000
July 1, 2005 $ 600,000
October 1, 2005 $ 600,000
January 2, 2006 $ 600,000
April 1, 2006 $ 600,000
July 1, 2006 $57,000,000
October 1, 2006 $57,000,000
January 2, 2007 $57,000,000
April 1, 2007 $57,000,000
(c) To the extent not previously paid, (i) all Tranche A Term
Loans shall be due and payable on the Tranche A Maturity Date and (ii) all
Tranche B Term Loans shall be due and payable on the Tranche B Maturity Date.
(d) Any prepayment of a Term Borrowing of either Class shall
be applied to reduce the subsequent scheduled repayments of the Term Borrowings
of such Class to be made pursuant to this Section ratably. If the initial
aggregate amount of the Lenders' Term Commitments of either Class exceeds the
aggregate principal amount of Term Loans of such Class that are made on the
Effective Date, then the scheduled repayments of Term Borrowings of such Class
to be made pursuant to this Section shall be reduced ratably by an aggregate
amount equal to such excess.
(e) Prior to any repayment of any Term Borrowings of either
Class hereunder, the Borrower shall select the Borrowing or Borrowings of the
applicable Class to be repaid and shall notify the Administrative Agent by
telephone (confirmed by telecopy) of such selection not later than 11:00 a.m.,
New York City time, three Business Days before the scheduled date of such
repayment. Each repayment of a Borrowing shall be applied ratably to the Loans
included in the repaid Borrowing. Repayments of Term Borrowings shall be
accompanied by accrued interest on the amount repaid.
SECTION 2.11. PREPAYMENT OF LOANS. (a) The Borrower shall
have the right at any time and from time to time to prepay any Borrowing in
whole or in part, subject to the requirements of this Section.
(b) In the event and on such occasion that the sum of the
Revolving Exposures exceeds the total Revolving Commitments, the Borrower shall
prepay Revolving Borrowings or Swingline Borrowings (or, if no such Borrowings
are outstanding, deposit cash collateral in an account with the Administrative
Agent pursuant to Section 2.05(j)) in an aggregate amount equal to such excess.
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(c) In the event and on each occasion that any Net Proceeds
are received by or on behalf of Holdings, the Borrower or any Restricted
Subsidiary in respect of any Prepayment Event, the Borrower shall, within five
Business Days after such Net Proceeds are received, prepay Term Borrowings in
an aggregate amount equal to such Net Proceeds (or, in the case of an event
described in clause (c) of the definition of the term Prepayment Event, 50% of
such Net Proceeds); PROVIDED that, in the case of any event described in clause
(a) of the definition of the term Prepayment Event, if the Borrower shall
deliver to the Administrative Agent a certificate of a Financial Officer to the
effect that the Borrower and the Restricted Subsidiaries intend to apply the
Net Proceeds from such event (or a portion thereof specified in such
certificate), within 360 days after receipt of such Net Proceeds, (i) to
acquire assets (including by making a Permitted Acquisition) productive in the
Borrower's line of business as conducted on the Effective Date, or ancillary or
complementary thereto, or (ii) to the extent such Prepayment Event arises from
the sale, transfer or disposition of any investment in an Unrestricted
Subsidiary, to make investments in one or more other Unrestricted Subsidiaries,
and, in each case, certifying that no Default has occurred and is continuing,
then no prepayment shall be required pursuant to this paragraph in respect of
the Net Proceeds in respect of such event (or the portion of such Net Proceeds
specified in such certificate, if applicable) except to the extent of any such
Net Proceeds therefrom that have not been so applied by the end of such 360-day
period, at which time a prepayment shall be required in an amount equal to such
Net Proceeds that have not been so applied.
(d) Following the end of each fiscal year of the Borrower,
commencing with the fiscal year ending March 26, 2001, the Borrower shall
prepay Term Borrowings in an aggregate amount equal to 50% of Excess Cash Flow
for such fiscal year. Each prepayment pursuant to this paragraph shall be made
on or before the date on which financial statements are delivered pursuant to
Section 5.01 with respect to the fiscal year for which Excess Cash Flow is
being calculated (and in any event within 90 days after the end of such fiscal
year).
(e) Prior to any optional or mandatory prepayment of
Borrowings hereunder, the Borrower shall select the Borrowing or Borrowings to
be prepaid and shall specify such selection in the notice of such prepayment
pursuant to paragraph (f) of this Section. In the event of any optional or
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mandatory prepayment of Term Borrowings made at a time when Term Borrowings of
both Classes remain outstanding, the Borrower shall select Term Borrowings to
be prepaid so that the aggregate amount of such prepayment is allocated between
the Tranche A Term Borrowings and Tranche B Term Borrowings pro rata based on
the aggregate principal amount of outstanding Borrowings of each such Class;
PROVIDED that any Tranche B Lender may elect, by notice to the Administrative
Agent by telephone (confirmed by telecopy) by 12:00 noon, New York City time,
at least two Business Days prior to the prepayment date, to decline all or any
portion of any mandatory prepayment of its Tranche B Term Loans pursuant to
this Section, in which case the aggregate amount of the prepayment that would
have been applied to prepay Tranche B Term Loans but was so declined shall be
applied to prepay Tranche A Term Borrowings.
(f) The Borrower shall notify the Administrative Agent (and, in the
case of prepayment of a Swingline Loan, the Swingline Lender) by telephone
(confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of any Borrowing (other than a Swingline Loan or an optional
prepayment of an ABR Borrowing), not later than 11:00 a.m., New York City time,
three Business Days before the date of prepayment, (ii) in the case of an
optional prepayment of an ABR Borrowing, not later than 11:00 a.m., New York
City time, one Business Day before the date of prepayment or (iii) in the case
of prepayment of a Swingline Loan, not later than 12:00 noon, New York City
time, on the date of prepayment. Each such notice shall be irrevocable and
shall specify the prepayment date, the principal amount of each Borrowing or
portion thereof to be prepaid and, in the case of a mandatory prepayment, a
reasonably detailed calculation of the amount of such prepayment; PROVIDED
that, if a notice of optional prepayment is given in connection with a
conditional notice of termination of the Revolving Commitments as contemplated
by Section 2.08, then such notice of prepayment may be revoked if such notice
of termination is revoked in accordance with Section 2.08. Promptly following
receipt of any such notice (other than a notice relating solely to Swingline
Loans), the Administrative Agent shall advise the Lenders of the contents
thereof. Each partial prepayment of any Borrowing shall be in an amount that
would be permitted in the case of an advance of a Borrowing of the same Type as
provided in Section 2.02, except as necessary to apply fully the required
amount of a mandatory prepayment. Each prepayment of a Borrowing shall be
applied ratably to the Loans included in the prepaid Borrowing. Prepayments
shall be accompanied by accrued interest to the extent required by Section
2.13.
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SECTION 2.12. FEES. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Revolving Lender a commitment fee,
which shall accrue at the Applicable Rate on the average daily unused amount of
the Revolving Commitment of such Lender during the period from and including
the Effective Date to but excluding the date on which such Revolving Commitment
terminates. Accrued commitment fees shall be payable in arrears on the last day
of March, June, September and December of each year and on the date on which
the Revolving Commitments terminate, commencing on the first such date to occur
after the date hereof. All commitment fees shall be computed on the basis of a
year of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day). For purposes of computing
commitment fees with respect to Revolving Commitments, a Revolving Commitment
of a Lender shall be deemed to be used to the extent of the outstanding
Revolving Loans and LC Exposure of such Lender (and the Swingline Exposure of
such Lender shall be disregarded for such purpose).
(b) The Borrower agrees to pay (i) to the Administrative
Agent for the account of each Revolving Lender a participation fee with respect
to its participations in Letters of Credit, which shall accrue at the same
Applicable Rate as interest on Eurodollar Revolving Loans on the average daily
amount of such Lender's LC Exposure (excluding any portion thereof attributable
to unreimbursed LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date on which such Lender's
Revolving Commitment terminates and the date on which such Lender ceases to
have any LC Exposure, and (ii) to the Issuing Bank a fronting fee, which shall
accrue at the rate of 0.25% per annum on the average daily amount of the LC
Exposure (excluding any portion thereof attributable to unreimbursed LC
Disbursements) during the period from and including the Effective Date to but
excluding the later of the date of termination of the Revolving Commitments and
the date on which there ceases to be any LC Exposure, as well as the Issuing
Bank's standard fees with respect to the issuance, amendment, renewal or
extension of any Letter of Credit or processing of drawings thereunder.
Participation fees and fronting fees accrued through and including the last day
of March, June, September and December of each year shall be payable on the
third Business Day following such last day, commencing on the first such date
to occur after the Effective Date; PROVIDED that all such fees shall be payable
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on the date on which the Revolving Commitments terminate and any such fees
accruing after the date on which the Revolving Commitments terminate shall be
payable on demand. Any other fees payable to the Issuing Bank pursuant to this
paragraph shall be payable within 10 days after demand. All participation fees
and fronting fees shall be computed on the basis of a year of 360 days and
shall be payable for the actual number of days elapsed (including the first day
but excluding the last day).
(c) The Borrower agrees to pay to the Administrative Agent,
for its own account, fees payable in the amounts and at the times separately
agreed upon between the Borrower and the Administrative Agent.
(d) All fees payable hereunder shall be paid on the dates
due, in immediately available funds, to the Administrative Agent (or to the
Issuing Bank, in the case of fees payable to it) for distribution, in the case
of commitment fees and participation fees, to the Lenders entitled thereto.
Fees paid shall not be refundable under any circumstances.
SECTION 2.13. INTEREST. (a) The Loans comprising each ABR
Borrowing (including each Swingline Loan) shall bear interest at the Alternate
Base Rate plus the Applicable Rate.
(b) The Loans comprising each Eurodollar Borrowing shall bear
interest at the Adjusted LIBO Rate for the Interest Period in effect for such
Borrowing plus the Applicable Rate.
(c) Notwithstanding the foregoing, if any principal of or
interest on any Loan or any fee or other amount payable by the Borrower
hereunder is not paid when due, whether at stated maturity, upon acceleration
or otherwise, such overdue amount shall bear interest, after as well as before
judgment, at a rate per annum equal to (i) in the case of overdue principal of
any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the
preceding paragraphs of this Section or (ii) in the case of any other amount,
2% plus the rate applicable to ABR Revolving Loans as provided in paragraph (a)
of this Section.
(d) Accrued interest on each Loan shall be payable in arrears
on each Interest Payment Date for such Loan and, in the case of Revolving
Loans, upon termination of the Revolving Commitments; PROVIDED that (i)
interest accrued pursuant to paragraph (c) of this Section shall be payable on
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demand, (ii) in the event of any repayment or prepayment of any Loan (other
than a prepayment of an ABR Revolving Loan prior to the end of the Revolving
Availability Period), accrued interest on the principal amount repaid or
prepaid shall be payable on the date of such repayment or prepayment and (iii)
in the event of any conversion of any Eurodollar Loan prior to the end of the
current Interest Period therefor, accrued interest on such Loan shall be
payable on the effective date of such conversion.
(e) All interest hereunder shall be computed on the basis of
a year of 360 days, except that interest computed by reference to the Alternate
Base Rate at times when the Alternate Base Rate is based on the Prime Rate
shall be computed on the basis of a year of 365 days (or 366 days in a leap
year), and in each case shall be payable for the actual number of days elapsed
(including the first day but excluding the last day). The applicable Alternate
Base Rate or Adjusted LIBO Rate shall be determined by the Administrative
Agent, and such determination shall be conclusive absent manifest error.
SECTION 2.14. ALTERNATE RATE OF INTEREST. If prior to the
commencement of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which determination
shall be conclusive absent manifest error) that adequate and
reasonable means do not exist for ascertaining the Adjusted LIBO Rate
for such Interest Period; or
(b) the Administrative Agent is advised by the Required
Lenders that the Adjusted LIBO Rate for such Interest Period will not
adequately and fairly reflect the cost to such Lenders (or Lender) of
making or maintaining their Loans (or its Loan) included in such
Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective
and (ii) if any Borrowing Request requests a Eurodollar Borrowing, such
Borrowing shall be made as an ABR Borrowing.
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SECTION 2.15. INCREASED COSTS. (a) If any Change in Law
shall:
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or for
the account of, or credit extended by, any Lender (except any such
reserve requirement reflected in the Adjusted LIBO Rate) or the
Issuing Bank; or
(ii) impose on any Lender or the Issuing Bank or the London
interbank market any other condition affecting this Agreement or
Eurodollar Loans made by such Lender or any Letter of Credit or
participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or the
Issuing Bank of participating in, issuing or maintaining any Letter of Credit
or to reduce the amount of any sum received or receivable by such Lender or the
Issuing Bank hereunder (whether of principal, interest or otherwise), then the
Borrower will pay to such Lender or the Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or the Issuing
Bank, as the case may be, for such additional costs incurred or reduction
suffered.
(b) If any Lender or the Issuing Bank determines that any
Change in Law regarding capital requirements has or would have the effect of
reducing the rate of return on such Lender's or the Issuing Bank's capital or
on the capital of such Lender's or the Issuing Bank's holding company, if any,
as a consequence of this Agreement or the Loans made by, or participations in
Letters of Credit held by, such Lender, or the Letters of Credit issued by the
Issuing Bank, to a level below that which such Lender or the Issuing Bank or
such Lender's or the Issuing Bank's holding company could have achieved but for
such Change in Law (taking into consideration such Lender's or the Issuing
Bank's policies and the policies of such Lender's or the Issuing Bank's holding
company with respect to capital adequacy), then from time to time the Borrower
will pay to such Lender or the Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or the Issuing Bank
or such Lender's or the Issuing Bank's holding company for any such reduction
suffered.
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(c) A certificate of a Lender or the Issuing Bank setting
forth the amount or amounts necessary to compensate such Lender or the Issuing
Bank or its holding company, as the case may be, as specified in paragraph (a)
or (b) of this Section shall be delivered to the Borrower and shall be
conclusive absent manifest error. The Borrower shall pay such Lender or the
Issuing Bank, as the case may be, the amount shown as due on any such
certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender or the Issuing
Bank to demand compensation pursuant to this Section shall not constitute a
waiver of such Lender's or the Issuing Bank's right to demand such
compensation; PROVIDED that the Borrower shall not be required to compensate a
Lender or the Issuing Bank pursuant to this Section for any increased costs or
reductions incurred more than 270 days prior to the date that such Lender or
the Issuing Bank, as the case may be, notifies the Borrower of the Change in
Law giving rise to such increased costs or reductions and of such Lender's or
the Issuing Bank's intention to claim compensation therefor; PROVIDED FURTHER
that, if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the 270-day period referred to above shall be extended to
include the period of retroactive effect thereof.
SECTION 2.16. BREAK FUNDING PAYMENTS. In the event of (a) the
payment of any principal of any Eurodollar Loan other than on the last day of
an Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last day
of the Interest Period applicable thereto, (c) the failure to borrow, convert,
continue or prepay any Revolving Loan or Term Loan on the date specified in any
notice delivered pursuant hereto (regardless of whether such notice may be
revoked under Section 2.11(f) and is revoked in accordance therewith), or (d)
the assignment of any Eurodollar Loan other than on the last day of the
Interest Period applicable thereto as a result of a request by the Borrower
pursuant to Section 2.19, then, in any such event, the Borrower shall
compensate each Lender for the loss, cost and expense attributable to such
event. In the case of a Eurodollar Loan, such loss, cost or expense to any
Lender shall be deemed to include an amount determined by such Lender to be the
excess, if any, of (i) the amount of interest which would have accrued on the
principal amount of such Loan had such event not occurred, at the Adjusted LIBO
Rate that would have been applicable to such Loan, for the period from the date
of such event to the last day of the then current Interest Period therefor (or,
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in the case of a failure to borrow, convert or continue, for the period that
would have been the Interest Period for such Loan), over (ii) the amount of
interest which would accrue on such principal amount for such period at the
interest rate which such Lender would bid were it to bid, at the commencement
of such period, for dollar deposits of a comparable amount and period from
other banks in the Eurodollar market. A certificate of any Lender setting forth
any amount or amounts that such Lender is entitled to receive pursuant to this
Section shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay such Lender the amount shown as due on
any such certificate within 10 days after receipt thereof.
SECTION 2.17. TAXES. (a) Any and all payments by or on
account of any obligation of the Borrower hereunder or under any other Loan
Document shall be made free and clear of and without deduction for any
Indemnified Taxes or Other Taxes; PROVIDED that if the Borrower shall be
required to deduct any Indemnified Taxes or Other Taxes from such payments,
then (i) the sum payable shall be increased as necessary so that after making
all required deductions (including deductions applicable to additional sums
payable under this Section) the Administrative Agent, Lender or Issuing Bank
(as the case may be) receives an amount equal to the sum it would have received
had no such deductions been made, (ii) the Borrower shall make such deductions
and (iii) the Borrower shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to
the relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent,
each Lender and the Issuing Bank, within 30 days after written demand therefor,
for the full amount of any Indemnified Taxes or Other Taxes paid by the
Administrative Agent, such Lender or the Issuing Bank, as the case may be, on
or with respect to any payment by or on account of any obligation of the
Borrower hereunder or under any other Loan Document (including Indemnified
Taxes or Other Taxes imposed or asserted on or attributable to amounts payable
under this Section) and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or
liability delivered to the Borrower by a Lender or the Issuing Bank, or by the
Administrative Agent on its own behalf or on behalf of a Lender or the Issuing
Bank, shall be conclusive absent manifest error.
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(d) As soon as practicable after any payment of Indemnified
Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower
shall deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy
of the return reporting such payment or other evidence of such payment
reasonably satisfactory to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption from
or reduction of 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, such properly completed and executed documentation prescribed
by applicable law or reasonably requested by the Borrower as will permit such
payments to be made without withholding or at a reduced rate, provided that
such Foreign Lender has received written notice from the Borrower advising it
of the availability of such exemption or reduction and containing all
applicable documentation.
(f) If the Administrative Agent or a Lender determines, in
its sole discretion, that it has received a refund of any Taxes or Other Taxes
as to which it has been indemnified by the Borrower or with respect to which
the Borrower has paid additional amounts pursuant to this Section 2.17, it
shall pay over such refund to the Borrower (but only to the extent of indemnity
payments made, or additional amounts paid, by the Borrower under this Section
2.17 with respect to the Taxes or Other Taxes giving rise to such refund), net
of all out-of-pocket expenses of the Administrative Agent or such Lender and
without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund); PROVIDED, that the Borrower, upon the
request of the Administrative Agent or such Lender, agrees to repay the amount
refunded to the Borrower (plus any penalties, interest or other charges imposed
by the relevant Governmental Authority) to the Administrative Agent or such
Lender in the event the Administrative Agent or such Lender is required to
repay such refund to such Governmental Authority. This Section shall not be
construed to require the Administrative Agent or any Lender (i) to make
available its tax returns (or any other information relating to its taxes which
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it deems confidential) to the Borrower or any other Person or (ii) to determine
whether it is entitled to apply for, or to apply for, a refund of any Taxes or
Other Taxes.
SECTION 2.18. PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING
OF SETOFFS. (a) The Borrower shall make each payment required to be made by it
hereunder or under any other Loan Document (whether of principal, interest,
fees or reimbursement of LC Disbursements, or of amounts payable under Section
2.15, 2.16 or 2.17, or otherwise) prior to the time expressly required
hereunder or under such other Loan Document for such payment (or, if no such
time is expressly required, prior to 12:00 noon, New York City time), on the
date when due, in immediately available funds, without setoff or counterclaim.
Any amounts received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at 270 Park Avenue,
New York, New York, except payments to be made directly to the Issuing Bank or
Swingline Lender as expressly provided herein and except that payments pursuant
to Sections 2.15, 2.16, 2.17 and 9.03 shall be made directly to the Persons
entitled thereto and payments pursuant to other Loan Documents shall be made to
the Persons specified therein. The Administrative Agent shall distribute any
such payments received by it for the account of any other Person to the
appropriate recipient promptly following receipt thereof. If any payment under
any Loan Document shall be due on a day that is not a Business Day, the date
for payment shall be extended to the next succeeding Business Day, and, in the
case of any payment accruing interest, interest thereon shall be payable for
the period of such extension. All payments under each Loan Document shall be
made in dollars.
(b) If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal,
unreimbursed LC Disbursements, interest and fees then due hereunder, such funds
shall be applied (i) first, towards payment of interest and fees then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, and (ii) second, towards
payment of principal and unreimbursed LC Disbursements then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
principal and unreimbursed LC Disbursements then due to such parties.
(c) If any Lender shall, by exercising any right of setoff or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Revolving Loans, Term Loans or participations in LC
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Disbursements or Swingline Loans resulting in such Lender receiving payment of
a greater proportion of the aggregate amount of its Revolving Loans, Term Loans
and participations in LC Disbursements and Swingline Loans and accrued interest
thereon than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value)
participations in the Revolving Loans, Term Loans and participations in LC
Disbursements and Swingline Loans of other Lenders to the extent necessary so
that the benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Revolving Loans, Term Loans and participations in LC
Disbursements and Swingline Loans; PROVIDED that (i) if any such participations
are purchased and all or any portion of the payment giving rise thereto is
recovered, such participations shall be rescinded and the purchase price
restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph shall not be construed to apply to any payment
made by the Borrower pursuant to and in accordance with the express terms of
this Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations
in LC Disbursements to any assignee or participant, other than to the Borrower
or any Subsidiary or Affiliate thereof (as to which the provisions of this
paragraph shall apply). The Borrower consents to the foregoing and agrees, to
the extent it may effectively do so under applicable law, that any Lender
acquiring a participation pursuant to the foregoing arrangements may exercise
against the Borrower rights of set-off and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of the Borrower
in the amount of such participation.
(d) Unless the Administrative Agent shall have received
notice from the Borrower prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders or the Issuing Bank
hereunder that the Borrower will not make such payment, the Administrative
Agent may assume that the Borrower has made such payment on such date in
accordance herewith and may, in reliance upon such assumption, distribute to
the Lenders or the Issuing Bank, as the case may be, the amount due. In such
event, if the Borrower has not in fact made such payment, then each of the
Lenders or the Issuing Bank, as the case may be, severally agrees to repay to
the Administrative Agent forthwith on demand the amount so distributed to such
Lender or Issuing Bank with interest thereon, for each day from and including
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the date such amount is distributed to it to but excluding the date of payment
to the Administrative Agent, at the greater of the Federal Funds Effective Rate
and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to
be made by it pursuant to Section 2.04(c), 2.05(d) or (e), 2.06(b), 2.18(d) or
9.03(c), then the Administrative Agent may, in its discretion (notwithstanding
any contrary provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender's
obligations under such Sections until all such unsatisfied obligations are
fully paid.
SECTION 2.19. MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS.
(a) If any Lender requests compensation under Section 2.15, or if the Borrower
is required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.17, then such
Lender shall use reasonable efforts to designate a different lending office for
funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or affiliates, if, in the
judgment of such Lender, such designation or assignment (i) would eliminate or
reduce amounts payable pursuant to Section 2.15 or 2.17, as the case may be, in
the future and (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The Borrower
hereby agrees to pay all reasonable costs and expenses incurred by any Lender
in connection with any such designation or assignment.
(b) If any Lender requests compensation under Section 2.15,
or if the Borrower is required to pay any additional amount to any Lender or
any Governmental Authority for the account of any Lender pursuant to Section
2.17, or if any Lender defaults in its obligation to fund Loans hereunder, then
the Borrower may, at its sole expense and effort, upon notice to such Lender
and the Administrative Agent, require such Lender to assign and delegate,
without recourse (in accordance with and subject to the restrictions contained
in Section 9.04), all its interests, rights and obligations under this
Agreement to an assignee that shall assume such obligations (which assignee may
be another Lender, if a Lender accepts such assignment); PROVIDED that (i) the
Borrower shall have received the prior written consent of the Administrative
Agent (and, if a Revolving Commitment is being assigned, the Issuing Bank and
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Swingline Lender), which consent shall not unreasonably be withheld, (ii) such
Lender shall have received payment of an amount equal to the outstanding
principal of its Loans and participations in LC Disbursements and Swingline
Loans, accrued interest thereon, accrued fees and all other amounts payable to
it hereunder, from the assignee (to the extent of such outstanding principal
and accrued interest and fees) or the Borrower (in the case of all other
amounts) and (iii) in the case of any such assignment resulting from a claim
for compensation under Section 2.15 or payments required to be made pursuant to
Section 2.17, such assignment will result in a material reduction in such
compensation or payments. A Lender shall not be required to make any such
assignment and delegation if, prior thereto, as a result of a waiver by such
Lender or otherwise, the circumstances entitling the Borrower to require such
assignment and delegation cease to apply.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Each of Holdings and the Borrower represents and warrants to
the Lenders that:
SECTION 3.01. ORGANIZATION; POWERS. Each of Holdings, the
Borrower and its Restricted Subsidiaries is duly organized, validly existing
and in good standing under the laws of the jurisdiction of its organization,
has all requisite power and authority to carry on its business as now conducted
and, except where the failure to do so, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect, is qualified
to do business in, and is in good standing in, every jurisdiction where such
qualification is required.
SECTION 3.02. AUTHORIZATION; ENFORCEABILITY. The Transactions
to be entered into by each Loan Party are within such Loan Party's corporate
powers and have been duly authorized by all necessary corporate and, if
required, stockholder action. This Agreement has been duly executed and
delivered by each of Holdings and the Borrower and constitutes, and each other
Loan Document to which any Loan Party is to be a party, when executed and
delivered by such Loan Party, will constitute, a legal, valid and binding
obligation of Holdings, the Borrower or such Loan Party (as the case may be),
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors'
rights generally and subject to general principles of equity, regardless of
whether considered in a proceeding in equity or at law.
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SECTION 3.03. GOVERNMENTAL APPROVALS; NO CONFLICTS. The
Transactions (a) do not require any consent or approval of, registration or
filing with, or any other action by, any Governmental Authority, except such as
have been obtained or made and are in full force and effect and except filings
necessary to perfect Liens created under the Loan Documents, (b) will not
violate any applicable law or regulation or the charter, by-laws or other
organizational documents of Holdings, the Borrower or any of its Subsidiaries
or any order of any Governmental Authority, (c) will not violate or result in a
default under any indenture, agreement or other instrument (other than any
indenture, agreement or other instrument in respect of Indebtedness that will
be repaid on the Effective Date) binding upon Holdings, the Borrower or any of
its Restricted Subsidiaries or its assets, or give rise to a right thereunder
to require any payment to be made by Holdings, the Borrower or any of its
Restricted Subsidiaries, and (d) will not result in the creation or imposition
of any Lien on any asset of Holdings, the Borrower or any of its Restricted
Subsidiaries, except Liens created under the Loan Documents.
SECTION 3.04. FINANCIAL CONDITION; NO MATERIAL ADVERSE
CHANGE. (a) The Borrower has heretofore furnished to the Lenders its
consolidated balance sheet and statements of income, stockholders' equity and
cash flows (i) as of and for the fiscal year ended March 30, 1998, reported on
by Arthur Andersen LLP, independent public accountants, and (ii) as of and for
the fiscal quarter and the portion of the fiscal year ended December 28, 1998,
certified by its chief financial officer. Such financial statements present
fairly, in all material respects, the financial position and results of
operations and cash flows of the Borrower and its consolidated Subsidiaries as
of such dates and for such periods in accordance with GAAP, subject to year-end
audit adjustments and the absence of footnotes in the case of the statements
referred to in clause (ii) above.
(b) The Borrower has heretofore furnished to the Lenders its
pro forma consolidated balance sheet as of December 28, 1998, prepared giving
effect to the Transactions as if the Transactions had occurred on such date.
Such pro forma consolidated balance sheet (i) has been prepared in good faith
based on the same assumptions used to prepare the pro forma financial
statements included in the Information Memorandum (which assumptions are
believed by Holdings and the Borrower to be reasonable), (ii) is based on the
best information available to Holdings and the Borrower after due inquiry,
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(iii) accurately reflects all adjustments necessary to give effect to the
Transactions and (iv) presents fairly, in all material respects, the pro forma
financial position of the Borrower and its consolidated Subsidiaries as of
December 28, 1998 as if the Transactions had occurred on such date.
(c) Except as disclosed in the financial statements referred
to above or the notes thereto or in the Information Memorandum and except for
the Disclosed Matters, after giving effect to the Transactions, none of
Holdings, the Borrower or its Subsidiaries has, as of the Effective Date, any
material contingent liabilities, unusual long-term commitments or unrealized
losses.
(d) Since March 30, 1998, there has been no material adverse
change in the business, assets, operations, prospects or condition, financial
or otherwise, of Holdings, the Borrower and its Restricted Subsidiaries, taken
as a whole.
SECTION 3.05. PROPERTIES. (a) Each of Holdings, the Borrower
and its Restricted Subsidiaries has good title to, or valid leasehold interests
in, all its real and personal property material to its business (including its
Mortgaged Properties), except for minor defects in title that do not interfere
with its ability to conduct its business as currently conducted or to utilize
such properties for their intended purposes.
(b) Each of Holdings, the Borrower and its Restricted
Subsidiaries owns, or is licensed to use, all trademarks, tradenames,
copyrights, patents and other intellectual property material to its business,
and the use thereof by Holdings, the Borrower and its Restricted Subsidiaries
does not infringe upon the rights of any other Person, except for any such
infringements that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect. Schedule 3.05(b) sets forth a
complete list of all trademarks, tradenames, copyrights, patents and other
intellectual property owned by the Borrower and its Restricted Subsidiaries as
of the Effective Date that has been duly registered in, filed in or issued by
the United States Patent and Trademark Office or the United States Copyright
Office or any other appropriate office.
(c) Schedule 3.05(c) sets forth the address of each real
property that is owned or leased by the Borrower or any of its Subsidiaries as
of the Effective Date after giving effect to the Transactions.
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(d) As of the Effective Date, neither Holdings, the Borrower
nor any of its Subsidiaries has received notice of, or has knowledge of, any
pending or contemplated condemnation proceeding affecting any Mortgaged
Property or any sale or disposition thereof in lieu of condemnation. Neither
any Mortgaged Property nor any interest therein is subject to any right of
first refusal, option or other contractual right to purchase such Mortgaged
Property or interest therein.
SECTION 3.06. LITIGATION AND ENVIRONMENTAL MATTERS. (a) There
are no actions, suits or proceedings by or before any arbitrator or
Governmental Authority pending against or, to the knowledge of Holdings or the
Borrower, threatened against or affecting Holdings, the Borrower or any of its
Subsidiaries (i) that could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect (other than the Disclosed
Matters), (ii) that involve any of the Loan Documents or (iii) that involve the
Transactions, are not frivolous and, if adversely determined, could reasonably
be expected, individually or in the aggregate, to be adverse to the interests
of the Lenders.
(b) Except for the Disclosed Matters and except with respect
to any other matters that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, neither
Holdings, the Borrower nor any of its Subsidiaries (i) has failed to comply
with any Environmental Law or to obtain, maintain or comply with any permit,
license or other approval required under any Environmental Law, (ii) has become
subject to any Environmental Liability, (iii) has received notice of any claim
asserting that Holdings, the Borrower or any of its Subsidiaries is obligated
to redress any Environmental Liability or (iv) knows of any basis for any
Environmental Liability that Holdings, the Borrower or any of its Subsidiaries
is reasonably likely to become obligated to redress.
(c) Since the date of this Agreement, there has been no
change in the status of the Disclosed Matters that, individually or in the
aggregate, has resulted in, or materially increased the likelihood of, a
Material Adverse Effect.
SECTION 3.07. COMPLIANCE WITH LAWS AND AGREEMENTS. Each of
Holdings, the Borrower and its Subsidiaries is in compliance with all laws,
regulations and orders of any Governmental Authority applicable to it or its
property and all indentures, agreements and other instruments binding upon it
or its property, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect. No Default has occurred and is continuing.
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SECTION 3.08. INVESTMENT AND HOLDING COMPANY STATUS. Neither
Holdings, the Borrower nor any of its Subsidiaries is (a) an "investment
company" as defined in, or subject to regulation under, the Investment Company
Act of 1940 or (b) a "holding company" as defined in, or subject to regulation
under, the Public Utility Holding Company Act of 1935.
SECTION 3.09. TAXES. Each of Holdings, the Borrower and its
Subsidiaries has timely filed or caused to be filed all Tax returns and reports
required to have been filed and has paid or caused to be paid all Taxes
required to have been paid by it, except (a) any Taxes that are being contested
in good faith by appropriate proceedings and for which Holdings, the Borrower
or such Subsidiary, as applicable, has set aside on its books adequate reserves
or (b) to the extent that the failure to do so could not reasonably be expected
to result in a Material Adverse Effect.
SECTION 3.10. ERISA. No ERISA Event has occurred or is
reasonably expected to occur that, when taken together with all other such
ERISA Events for which liability is reasonably expected to occur, could
reasonably be expected to result in a Material Adverse Effect. The present
value of all accumulated benefit obligations under each Plan (based on the
assumptions used for purposes of Statement of Financial Accounting Standards
No. 87) did not, as of the date of the most recent financial statements
reflecting such amounts, exceed by more than $15,000,000 the fair market value
of the assets of such Plan, and the present value of all accumulated benefit
obligations of all underfunded Plans (based on the assumptions used for
purposes of Statement of Financial Accounting Standards No. 87) did not, as of
the date of the most recent financial statements reflecting such amounts,
exceed by more than $15,000,000 the fair market value of the assets of all such
underfunded Plans.
SECTION 3.11. DISCLOSURE. The Borrower has disclosed to the
Lenders all agreements, instruments and corporate or other restrictions to
which Holdings, the Borrower or any of its Subsidiaries is subject, and all
other matters known to any of them, that, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect. Neither
the Information Memorandum nor any of the other reports, financial statements,
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certificates or other information furnished by or on behalf of any Loan Party
to the Administrative Agent or any Lender in connection with the negotiation of
this Agreement or any other Loan Document or delivered hereunder or thereunder
(as modified or supplemented by other information so furnished) contains any
material misstatement of fact or omits to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; PROVIDED that, with respect to projected financial
information, Holdings and the Borrower represent only that such information was
prepared in good faith based upon assumptions believed to be reasonable at the
time.
SECTION 3.12. SUBSIDIARIES. Holdings does not have any
subsidiaries other than the Borrower and the Borrower's Subsidiaries. Schedule
3.12 sets forth the name of, and the ownership interest of the Borrower in,
each Subsidiary of the Borrower and identifies each Subsidiary that is a
Subsidiary Loan Party, in each case as of the Effective Date. As of the
Effective Date, all Subsidiaries are Restricted Subsidiaries.
SECTION 3.13. INSURANCE. Schedule 3.13 sets forth a
description of all insurance maintained by or on behalf of the Borrower and its
Subsidiaries as of the Effective Date. As of the Effective Date, all premiums
in respect of such insurance have been paid. Holdings and the Borrower believe
that the insurance maintained by or on behalf of the Borrower and its
Subsidiaries is adequate.
SECTION 3.14. LABOR MATTERS. As of the Effective Date, there
are no strikes, lockouts or slowdowns against Holdings, the Borrower or any
Subsidiary pending or, to the knowledge of Holdings or the Borrower,
threatened. The hours worked by and payments made to employees of Holdings, the
Borrower and the Restricted Subsidiaries have not been in violation of the Fair
Labor Standards Act or any other applicable Federal, state, local or foreign
law dealing with such matters. All payments due from Holdings, the Borrower or
any Restricted Subsidiary, or for which any claim may be made against Holdings,
the Borrower or any Restricted Subsidiary, on account of wages and employee
health and welfare insurance and other benefits, have been paid or accrued as a
liability on the books of Holdings, the Borrower or such Restricted Subsidiary.
The consummation of the Transactions will not give rise to any right of
termination or right of renegotiation on the part of any union under any
collective bargaining agreement to which Holdings, the Borrower or any
Subsidiary is bound.
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SECTION 3.15. SOLVENCY. Immediately after the consummation of
the Transactions to occur on the Effective Date and immediately following the
making of each Loan made on the Effective Date and after giving effect to the
application of the proceeds of such Loans, (a) the fair value of the assets of
each Loan Party, at a fair valuation, will exceed its debts and liabilities,
subordinated, contingent or otherwise; (b) the present fair saleable value of
the property of each Loan Party will be greater than the amount that will be
required to pay the probable liability of its debts and other liabilities,
subordinated, contingent or otherwise, as such debts and other liabilities
become absolute and matured; (c) each Loan Party will be able to pay its debts
and liabilities, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured; and (d) each Loan Party will not have
unreasonably small capital with which to conduct the business in which it is
engaged as such business is now conducted and is proposed to be conducted
following the Effective Date.
SECTION 3.16. SENIOR INDEBTEDNESS. The Obligations constitute
"Senior Indebtedness" under and as defined in the Subordinated Debt Documents.
SECTION 3.17. YEAR 2000. Any reprogramming required to permit
the proper functioning (but only to the extent that such proper functioning
would otherwise be impaired by the occurrence of the year 2000), in and
following the year 2000, of the computer systems of the Borrower and its
Subsidiaries and the testing of all such systems as so reprogrammed, will be
completed by July 1, 1999, except to the extent that the failure to do so would
not have any reasonable likelihood of having a Material Adverse Effect. The
cost to the Borrower and its Subsidiaries of such reprogramming and testing and
of the reasonably foreseeable consequences of year 2000 to the Borrower and its
Subsidiaries (including reprogramming errors and the failure of others' systems
or equipment) will not result in a Material Adverse Effect.
SECTION 3.18. SECURITY DOCUMENTS. (a) The Pledge Agreement
is effective to create in favor of the Collateral Agent, for the ratable
benefit of the Secured Parties, a legal, valid and enforceable security
interest in the Collateral (as defined in the Pledge Agreement) and, when the
portion of the Collateral constituting certificated securities (as defined in
the Uniform Commercial Code) is delivered to the Collateral Agent, the Pledge
Agreement shall constitute a fully perfected first priority Lien on, and
security interest in, all right, title and interest of the pledgor thereunder
in such Collateral, in each case prior and superior in right to any other
Person.
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(b) The Security Agreement is effective to create in favor of
the Collateral Agent, for the ratable benefit of the Secured Parties, a legal,
valid and enforceable security interest in the Collateral (as defined in the
Security Agreement) and, when financing statements in appropriate form are
filed in the offices specified on Schedule 6 to the Perfection Certificate, the
Security Agreement shall constitute a fully perfected Lien on, and security
interest in, all right, title and interest of the grantors thereunder in such
Collateral (other than the Intellectual Property (as defined in the Security
Agreement)), in each case prior and superior in right to any other Person,
other than with respect to Liens expressly permitted by the Security Agreement.
(c) When the Security Agreement is filed in the United States
Patent and Trademark Office and the United States Copyright Office, the
security interest created thereunder shall constitute a fully perfected Lien
on, and security interest in, all right, title and interest of the Loan Parties
in the Intellectual Property (as defined in the Security Agreement) in which a
security interest may be perfected by filing, recording or registering a
security agreement, financing statement or analogous document in the United
States Patent and Trademark Office or the United States Copyright Office, as
applicable, in each case prior and superior in right to any other Person, other
than with respect to the rights of Persons pursuant to Liens expressly
permitted by the Security Agreement (it being understood that subsequent
recordings in the United States Patent and Trademark Office and the United
States Copyright Office may be necessary to perfect a lien on registered
trademarks, trademark applications and copyrights acquired by the Loan Parties
after the date hereof).
(d) Each Mortgage is effective to create, subject to the
exceptions listed in each title insurance policy covering such Mortgage, in
favor of the Collateral Agent, for the ratable benefit of the Secured Parties,
a legal, valid and enforceable Lien on all of the Loan Parties' right, title
and interest in and to the Mortgaged Property thereunder and the proceeds
thereof, and when such Mortgage is filed in the offices specified on Schedule
3.18(d), such Mortgage shall constitute a Lien on, and security interest in,
all right, title and interest of the Loan Parties in such Mortgaged Property
and the proceeds thereof, in each case prior and superior in right to any other
Person, other than with respect to the rights of Persons pursuant to Liens
expressly permitted by such Mortgage.
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SECTION 3.19. MERGER. The Merger Agreement has been duly
authorized, executed and delivered by each of the parties thereto and
constitutes a legal, valid and binding obligation of each such party,
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors'
rights generally and subject to general principles of equity, regardless of
whether considered in a proceeding in equity or at law. A true, correct and
complete copy of the Merger Agreement has been furnished to the Administrative
Agent.
SECTION 3.20. CAPITALIZATION OF HOLDINGS. As of the date of
this Agreement, the authorized capital stock of Holdings consists of
100,000,000 shares of Class A Common Stock, par value $.01 per share, of which
22,786,536 shares are issued and outstanding, 20,000,000 shares of Class B
Common Stock, par value $.01 per share, of which no shares are outstanding, and
25,000,000 shares of Class C Common Stock, par value $.01 per share, of which
20,702,005 shares are outstanding. All such outstanding shares of stock are
fully paid and nonassessable.
ARTICLE IV
CONDITIONS
SECTION 4.01. EFFECTIVE DATE. The obligations of the Lenders
to make Loans and of the Issuing Bank to issue Letters of Credit hereunder
shall not become effective until the date on which each of the following
conditions is satisfied (or waived in accordance with Section 9.02):
(a) The Administrative Agent (or its counsel) shall have
received from each party hereto either (i) a counterpart of this
Agreement signed on behalf of such party or (ii) written evidence
satisfactory to the Administrative Agent (which may include telecopy
transmission of a signed signature page of this Agreement) that such
party has signed a counterpart of this Agreement.
(b) The Administrative Agent shall have received a favorable
written opinion (addressed to the Administrative Agent and the Lenders
and dated the Effective Date) of each of (i) Simpson Thacher &
Bartlett, counsel for the Borrower, substantially in the form of
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Exhibit B-1, and (ii) local counsel in each jurisdiction where a
Mortgaged Property is located, substantially in the form of Exhibit
B-2, and, in the case of each such opinion required by this paragraph,
covering such other matters relating to the Loan Parties, the Loan
Documents or the Transactions as the Required Lenders shall reasonably
request. The Borrower hereby requests such counsel to deliver such
opinions.
(c) The Administrative Agent shall have received such
documents and certificates as the Administrative Agent or its counsel
may reasonably request relating to the organization, existence and
good standing of each Loan Party, the authorization of the
Transactions and any other legal matters relating to the Loan Parties,
the Loan Documents or the Transactions, all in form and substance
satisfactory to the Administrative Agent and its counsel.
(d) The Administrative Agent shall have received a
certificate, dated the Effective Date and signed by the President, a
Vice President or a Financial Officer of the Borrower, confirming
compliance with the conditions set forth in paragraphs (a) and (b) of
Section 4.02.
(e) The Administrative Agent shall have received all fees and
other amounts due and payable on or prior to the Effective Date,
including, to the extent invoiced, reimbursement or payment of all
out-of-pocket expenses (including fees, charges and disbursements of
counsel) required to be reimbursed or paid by any Loan Party hereunder
or under any other Loan Document.
(f) The Collateral Agent shall have received counterparts of
the Pledge Agreement signed on behalf of Holdings, the Borrower and
each Subsidiary Loan Party, together with stock certificates
representing all the outstanding shares of capital stock of the
Borrower and each Subsidiary owned by or on behalf of any Loan Party
as of the Effective Date after giving effect to the Transactions
(except that stock certificates representing shares of common stock of
a Foreign Subsidiary may be limited to 65% of the outstanding shares
of common stock of such Foreign Subsidiary), promissory notes
evidencing all intercompany Indebtedness owed to any Loan Party by
Holdings, the Borrower or any Subsidiary as of the Effective Date
after giving effect to the Transactions and stock powers and
instruments of transfer, endorsed in blank, with respect to such stock
certificates and promissory notes.
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(g) The Collateral Agent shall have received counterparts of
the Security Agreement signed on behalf of Holdings, the Borrower and
each Subsidiary Loan Party, together with the following:
(i) all documents and instruments, including Uniform
Commercial Code financing statements, required by law or
reasonably requested by the Collateral Agent to be filed,
registered or recorded to create or perfect the Liens
intended to be created under the Security Agreement; and
(ii) a completed Perfection Certificate dated the
Effective Date and signed by an executive officer or
Financial Officer of the Borrower, together with all
attachments contemplated thereby, including the results of a
search of the Uniform Commercial Code (or equivalent) filings
made with respect to the Loan Parties in the jurisdictions
contemplated by the Perfection Certificate and copies of the
financing statements (or similar documents) disclosed by such
search and evidence reasonably satisfactory to the Collateral
Agent that the Liens indicated by such financing statements
(or similar documents) are permitted by the Security
Agreement or have been released.
(h) The Collateral Agent shall have received (i) counterparts
of a Mortgage with respect to each Mortgaged Property signed on behalf
of the record owner of such Mortgaged Property, (ii) a policy or
policies of title insurance issued by a nationally recognized title
insurance company, insuring the Lien of each such Mortgage as a valid
first Lien on the Mortgaged Property described therein, free of any
other Liens except as permitted by the Security Agreement, together
with such endorsements, coinsurance and reinsurance as the Collateral
Agent or the Required Lenders may reasonably request, and (iii) such
surveys, abstracts and appraisals as may be required pursuant to such
Mortgages or as the Collateral Agent or the Required Lenders may
reasonably request.
(i) The Administrative Agent shall have received counterparts
of (i) the Guarantee Agreement signed on behalf of Holdings and each
Subsidiary Loan Party and (ii) counterparts of the Indemnity,
Subrogation and Contribution Agreement signed on behalf of Holdings,
the Borrower and each Subsidiary Loan Party.
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(j) The Administrative Agent shall have received evidence
that the insurance required by Section 5.07 and the Security Documents
is in effect.
(k) All consents and approvals required to be obtained from
any Governmental Authority or other Person in connection with the
Acquisition shall have been obtained, and all applicable waiting
periods and appeal periods shall have expired, in each case without
the imposition of any burdensome conditions. The Acquisition shall
have been, or substantially simultaneously with the initial funding of
Loans on the Effective Date shall be, consummated in accordance with
the Acquisition Documents and applicable law, without any amendment to
or waiver of any material terms or conditions of the Acquisition
Documents not approved by the Required Lenders. The Administrative
Agent shall have received copies of the Acquisition Documents and all
certificates, opinions and other documents delivered thereunder,
certified by a Financial Officer as complete and correct.
(l) EMP Group L.L.C. shall have made the Equity Contribution
(with an amount satisfactory to the Administrative Agent to have been
provided by Evercore).
(m) The Borrower shall have received gross cash proceeds of
not less than $250,000,000 from the issuance of the Subordinated Debt.
Any terms and conditions of the Subordinated Debt and provisions of
the Subordinated Debt Documents that are inconsistent with those set
forth in the preliminary offering memorandum with respect to the
Subordinated Debt dated April 13, 1999, shall be satisfactory in all
respects to the Lenders. The Administrative Agent shall have received
copies of the Subordinated Debt Documents, certified by a Financial
Officer as complete and correct.
(n) All material conditions to the purchase of the Existing
Notes in the Debt Tender Offer shall have been satisfied without
giving effect to any waiver or amendment thereof not approved by the
Administrative Agent. The Borrower shall have repurchased not less
than a majority in principal amount of the Existing Notes in
accordance with the Debt Tender Offer Materials. The Supplemental
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Indenture to the Existing Notes Indenture contemplated by the Debt
Tender Offer, in the form previously approved by the Administrative
Agent, shall have been executed and delivered and be in full force and
effect.
(o) The consummation of the Debt Tender Offer and the other
transactions contemplated hereby shall not (i) violate any applicable
law, statute, rule or regulation or (ii) conflict with, or result in a
default or event of default under, any agreement of Merger Sub,
Holdings, the Borrower or any of the Subsidiaries that will be in
effect following the consummation of the Acquisition.
(p) All loans outstanding, interest thereon and other amounts
due and payable under the Existing Credit Agreement and under each
other agreement related thereto shall have been repaid in full, and
the Administrative Agent shall have received duly executed
documentation, in form and substance satisfactory to it, evidencing or
necessary for (i) the termination of the Existing Credit Agreement and
(ii) the cancelation of all related agreements, guarantees and
security interests granted by Holdings, the Borrower, its subsidiaries
or any other person in connection therewith and the discharge of all
obligations or interests thereunder.
(q) The Lenders shall have received (i) audited consolidated
and consolidating balance sheets and related statements of income,
stockholders' equity and cash flows of Holdings for the three fiscal
years ended prior to the Effective Date and (ii) unaudited
consolidated and consolidating balance sheets and related statements
of income, stockholders' equity and cash flows for Holdings for the
1999 fiscal quarters preceding the Effective Date (and, to the extent
available, for each month preceding the Effective Date since the last
such quarter), which audited and unaudited financial statements shall
be in form and scope satisfactory to the Lenders.
(r) The Lenders shall have received a pro forma consolidated
balance sheet of each of Holdings and the Borrower as of the end of
the most recent fiscal quarter ended prior to the Effective Date for
which balance sheets are available, reflecting all pro forma
adjustments as if the Transactions had been consummated on such date,
and such pro forma consolidated balance sheet shall be consistent in
all material respects with the forecasts and other information
previously provided to the Lenders. After giving effect to the
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Transactions, none of Holdings, the Borrower or any of the
Subsidiaries shall have outstanding any shares of preferred stock or
any Indebtedness, other than (i) Indebtedness incurred under the Loan
Documents, (ii) the Subordinated Debt, (iii) any Existing Notes not
purchased in the Debt Tender Offer and (iv) the Indebtedness
identified in Schedule 6.01. The aggregate amount of Transaction Costs
(including underwriting discounts and commissions) payable or
otherwise borne by Holdings, the Borrower and its Subsidiaries in
connection with the Transactions shall not exceed $60,600,000.
(s) The Administrative Agent shall have received a solvency
letter, in form and substance satisfactory to the Lenders, from
Valuation Research Corporation, with respect to the solvency of the
Loan Parties after giving effect to the Transactions.
The Administrative Agent shall notify the Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding.
Notwithstanding the foregoing, the obligations of the Lenders to make Loans and
of the Issuing Bank to issue Letters of Credit hereunder shall not become
effective unless each of the foregoing conditions is satisfied (or waived
pursuant to Section 9.02) at or prior to 5:00 p.m., New York City time, on July
6, 1999 (and, in the event such conditions are not so satisfied or waived, the
Commitments shall terminate at such time).
SECTION 4.02. EACH CREDIT EVENT. The obligation of each
Lender to make a Loan on the occasion of any Borrowing, and of the Issuing Bank
to issue, amend, renew or extend any Letter of Credit, is subject to receipt of
the request therefor in accordance herewith and to the satisfaction of the
following conditions:
(a) The representations and warranties of each Loan Party set
forth in the Loan Documents shall be true and correct (or, in the case
of such representations and warranties that are not qualified as to
materiality, true and correct in all material respects) on and as of
the date of such Borrowing or the date of issuance, amendment, renewal
or extension of such Letter of Credit, as applicable.
(b) At the time of and immediately after giving effect to
such Borrowing or the issuance, amendment, renewal or extension of
such Letter of Credit, as applicable, no Default shall have occurred
and be continuing.
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Each Borrowing and each issuance, amendment, renewal or extension of a Letter
of Credit shall be deemed to constitute a representation and warranty by
Holdings and the Borrower on the date thereof as to the matters specified in
paragraphs (a) and (b) of this Section.
ARTICLE V
AFFIRMATIVE COVENANTS
Until the Commitments have expired or been terminated and the
principal of and interest on each Loan and all fees payable hereunder shall
have been paid in full and all Letters of Credit shall have expired or
terminated and all LC Disbursements shall have been reimbursed, each of
Holdings and the Borrower covenants and agrees with the Lenders that:
SECTION 5.01. FINANCIAL STATEMENTS AND OTHER INFORMATION.
Holdings and the Borrower will furnish to the Administrative Agent (which shall
furnish a copy thereof to each Lender):
(a) within 90 days after the end of each fiscal year of the
Borrower, the audited consolidated balance sheet and related
statements of operations, stockholders' equity and cash flows of the
Borrower and its Restricted Subsidiaries as of the end of and for such
year, setting forth in each case in comparative form the figures for
the previous fiscal year, all reported on by Arthur Andersen LLP or
other independent public accountants of recognized national standing
(without a "going concern" or like qualification or exception and
without any qualification or exception as to the scope of such audit)
to the effect that such consolidated financial statements present
fairly in all material respects the financial condition and results of
operations of the Borrower and its Restricted Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied;
(b) within 60 days after the end of each of the first three
fiscal quarters of each fiscal year of the Borrower, (i) the
consolidated balance sheet and related statements of operations,
stockholders' equity and cash flows of the Borrower and its Restricted
Subsidiaries and (ii) statements of operations and stockholders'
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equity of (A) National Enquirer, Inc., (B) Weekly World News, Inc.,
(C) the weekly magazine known as STAR, (D) Country Weekly, Inc. and
(E) each Restricted Subsidiary formed or acquired after the Effective
Date, in each case as of the end of and for such fiscal quarter and
the then elapsed portion of the fiscal year, setting forth in each
case in comparative form the figures for the corresponding period or
periods of (or, in the case of the balance sheet, as of the end of)
the previous fiscal year, all certified by one of its Financial
Officers as presenting fairly in all material respects the financial
condition and results of operations of the Borrower and its Restricted
Subsidiaries, in each case on a consolidated basis in accordance with
GAAP consistently applied, subject to normal year-end audit
adjustments and the absence of footnotes;
(c) concurrently with any delivery of financial statements
under clause (a) or (b) above, a certificate of a Financial Officer of
the Borrower (i) certifying as to whether a Default has occurred and,
if a Default has occurred, specifying the details thereof and any
action taken or proposed to be taken with respect thereto, (ii)
setting forth reasonably detailed calculations demonstrating
compliance with Sections 6.01, 6.04, 6.05, 6.08, 6.12, 6.13, 6.14,
6.15 and 6.16, (iii) stating whether any change in GAAP or in the
application thereof has occurred since the date of the Borrower's
audited financial statements referred to in Section 3.04 and, if any
such change has occurred, specifying the effect of such change on the
financial statements accompanying such certificate and (iv) if any
Unrestricted Subsidiary exists (or existed at any time during the
period covered by such financial statements), attaching consolidating
balance sheets and income statements for such Unrestricted Subsidiary
as of the same dates and covering the same periods, certified as true,
correct and complete;
(d) concurrently with any delivery of financial statements
under clause (a) above, a certificate of the accounting firm that
reported on such financial statements stating whether they obtained
knowledge during the course of their examination of such financial
statements of any Default (which certificate may be limited to the
extent required by accounting rules or guidelines);
(e) prior to the commencement of each fiscal year of the
Borrower, a detailed consolidated quarterly budget for such fiscal
year (including a projected consolidated balance sheet and related
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statements of projected operations and cash flow as of the end of and
for such fiscal year and setting forth the assumptions used for
purposes of preparing such budget) and, promptly when available, any
significant revisions of such budget;
(f) promptly after the same become publicly available, copies
of all periodic and other reports, proxy statements and other
materials filed by Holdings, the Borrower or any Subsidiary with the
Securities and Exchange Commission, or any Governmental Authority
succeeding to any or all of the functions of said Commission, or with
any national securities exchange, or distributed by Holdings to its
shareholders generally, as the case may be; and
(g) promptly following any request therefor, such other
information regarding the operations, business affairs and financial
condition of Holdings, the Borrower or any Subsidiary, or compliance
with the terms of any Loan Document, as the Administrative Agent or
any Lender may reasonably request.
SECTION 5.02. NOTICES OF MATERIAL EVENTS. Holdings and the
Borrower will furnish to the Administrative Agent and each Lender prompt
written notice of the following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or
proceeding by or before any arbitrator or Governmental Authority
against or affecting Holdings, the Borrower or any Affiliate thereof
that, if adversely determined, could reasonably be expected to result
in a Material Adverse Effect;
(c) the occurrence of any ERISA Event that, alone or together
with any other ERISA Events that have occurred, could reasonably be
expected to result in liability of Holdings, the Borrower and its
Subsidiaries in an aggregate amount exceeding $5,000,000; and
(d) any other development that results in, or could
reasonably be expected to result in, a Material Adverse Effect.
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Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth
the details of the event or development requiring such notice and any action
taken or proposed to be taken with respect thereto.
SECTION 5.03. INFORMATION REGARDING COLLATERAL. (a) The
Borrower will furnish to the Administrative Agent prompt written notice of any
change (i) in any Loan Party's corporate name or in any trade name used to
identify it in the conduct of its business or in the ownership of its
properties, (ii) in the location of any Loan Party's chief executive office,
its principal place of business, any office in which it maintains books or
records relating to Collateral owned by it or any office or facility at which
Collateral owned by it is located (including the establishment of any such new
office or facility), (iii) in any Loan Party's identity or corporate structure
or (iv) in any Loan Party's Federal Taxpayer Identification Number. The
Borrower agrees not to effect or permit any change referred to in the preceding
sentence unless all filings have been made under the Uniform Commercial Code or
otherwise that are required in order for the Administrative Agent to continue
at all times following such change to have a valid, legal and perfected
security interest in all the Collateral. The Borrower also agrees promptly to
notify the Administrative Agent if any material portion of the Collateral is
damaged or destroyed.
(b) Each year, at the time of delivery of annual financial
statements with respect to the preceding fiscal year pursuant to clause (a) of
Section 5.01, the Borrower shall deliver to the Administrative Agent a
certificate of a Financial Officer and the chief legal officer of the Borrower
setting forth the information required pursuant to Section 2 of the Perfection
Certificate or confirming that there has been no change in such information
since the date of the Perfection Certificate delivered on the Effective Date or
the date of the most recent certificate delivered pursuant to this Section.
Each certificate delivered pursuant to this Section 5.03(b) shall identify in
the format of Schedule II, III, IV or V, as applicable, of the Security
Agreement all Intellectual Property (as defined in the Security Agreement) of
any Loan Party in existence on the date thereof and not then listed on such
Schedules as previously so identified to the Collateral Agent.
SECTION 5.04. EXISTENCE; CONDUCT OF BUSINESS. Each of
Holdings and the Borrower will, and will cause each of the Restricted
Subsidiaries to, do or cause to be done all things necessary to preserve, renew
and keep in full force and effect its legal existence and the rights, licenses,
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permits, privileges, franchises, patents, copyrights, trademarks and trade
names material to the conduct of its business; PROVIDED that the foregoing
shall not prohibit any merger, consolidation, liquidation or dissolution
permitted under Section 6.03.
SECTION 5.05. PAYMENT OF OBLIGATIONS. Each of Holdings and
the Borrower will, and will cause each of the Restricted Subsidiaries to, pay
its Indebtedness and other obligations, including Tax liabilities, before the
same shall become delinquent or in default, except where (a) the validity or
amount thereof is being contested in good faith by appropriate proceedings, (b)
Holdings, the Borrower or such Restricted Subsidiary has set aside on its books
adequate reserves with respect thereto in accordance with GAAP, (c) such
contest effectively suspends collection of the contested obligation and the
enforcement of any Lien securing such obligation and (d) the failure to make
payment pending such contest could not reasonably be expected to result in a
Material Adverse Effect.
SECTION 5.06. MAINTENANCE OF PROPERTIES. Each of Holdings and
the Borrower will, and will cause each of the Restricted Subsidiaries to, keep
and maintain all property material to the conduct of its business in good
working order and condition, ordinary wear and tear excepted.
SECTION 5.07. INSURANCE. Each of Holdings and the Borrower
will, and will cause each of its Restricted Subsidiaries to, maintain, with
financially sound and reputable insurance companies (a) insurance in such
amounts (with no greater risk retention) and against such risks as are
customarily maintained by companies of established repute engaged in the same
or similar businesses operating in the same or similar locations, including
insurance against libel actions, and (b) all insurance required to be
maintained pursuant to the Security Documents. The Borrower will furnish to the
Lenders, upon request of the Administrative Agent, information in reasonable
detail as to the insurance so maintained.
SECTION 5.08. CASUALTY AND CONDEMNATION. The Borrower (a)
will furnish to the Administrative Agent and the Lenders prompt written notice
of any casualty or other insured damage to any material portion of any
Collateral or the commencement of any action or proceeding for the taking of
any Collateral or any part thereof or interest therein under power of eminent
domain or by condemnation or similar proceeding and (b) will ensure that the
Net Proceeds of any such event (whether in the form of insurance proceeds,
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condemnation awards or otherwise) are collected and applied in accordance with
the applicable provisions of the Security Documents.
SECTION 5.09. BOOKS AND RECORDS; INSPECTION AND AUDIT RIGHTS.
Each of Holdings and the Borrower will, and will cause each of its Subsidiaries
to, keep proper books of record and account in which full, true and correct
entries are made of all dealings and transactions in relation to its business
and activities. Each of Holdings and the Borrower will, and will cause each of
its Subsidiaries to, permit any representatives designated by the
Administrative Agent or any Lender, upon reasonable prior notice, to visit and
inspect its properties, to examine and make extracts from its books and
records, and to discuss its affairs, finances and condition with its officers
and independent accountants, all at such reasonable times and as often as
reasonably requested.
SECTION 5.10. COMPLIANCE WITH LAWS. Each of Holdings and the
Borrower will, and will cause each of its Subsidiaries to, comply with all
laws, rules, regulations and orders of any Governmental Authority applicable to
it or its property, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.
SECTION 5.11. USE OF PROCEEDS AND LETTERS OF CREDIT. The
proceeds of the Term Loans will be used only (a) to repay amounts outstanding
under the Existing Credit Agreement on the Effective Date and (b) to purchase
Existing Notes accepted for payment pursuant to the Debt Tender Offer. The
proceeds of the Revolving Loans and Swingline Loans will be used only for
general corporate purposes. No part of the proceeds of any Loan will be used,
whether directly or indirectly, for any purpose that entails a violation of any
of the Regulations of the Board, including Regulations T, U and X. Letters of
Credit will be issued only for general corporate purposes.
SECTION 5.12. ADDITIONAL SUBSIDIARIES. If any additional
Subsidiary is formed or acquired after the Effective Date or if any
Unrestricted Subsidiary is designated as a Restricted Subsidiary, the Borrower
will notify the Administrative Agent and the Lenders thereof and (a) if such
Subsidiary is a Subsidiary Loan Party, the Borrower will cause such Subsidiary
to become a party to each of the Guarantee Agreement, the Pledge Agreement, the
Security Agreement and the Indemnity, Subrogation and Contribution Agreement
within three Business Days after such Subsidiary is formed or acquired and
promptly take such actions to create and perfect Liens on such Subsidiary's
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assets to secure the Obligations as the Administrative Agent or the Required
Lenders shall reasonably request and (b) if any Equity Interest in or
Indebtedness of such Subsidiary is owned by or on behalf of any Loan Party, the
Borrower will cause such Equity Interests and promissory notes evidencing such
Indebtedness to be pledged pursuant to the Pledge Agreement within three
Business Days after such Subsidiary is formed or acquired (except that, if such
Subsidiary is a Foreign Subsidiary, shares of common stock of such Subsidiary
to be pledged pursuant to the Pledge Agreement may be limited to 65% of the
outstanding shares of common stock of such Subsidiary).
SECTION 5.13. FURTHER ASSURANCES. (a) Each of Holdings and
the Borrower will, and will cause each Subsidiary Loan Party to, execute any
and all further documents, financing statements, agreements and instruments,
and take all such further actions (including the filing and recording of
financing statements, fixture filings, mortgages, deeds of trust and other
documents), which may be required under any applicable law, or which the
Administrative Agent or the Required Lenders may reasonably request, to
effectuate the transactions contemplated by the Loan Documents or to grant,
preserve, protect or perfect the Liens created or intended to be created by the
Security Documents or the validity or priority of any such Lien, all at the
expense of the Loan Parties. Holdings and the Borrower also agree to provide to
the Administrative Agent, from time to time upon request, evidence reasonably
satisfactory to the Administrative Agent as to the perfection and priority of
the Liens created or intended to be created by the Security Documents.
(b) If any material assets (including any real property or
improvements thereto or any interest therein) are acquired by the Borrower or
any Subsidiary Loan Party after the Effective Date (other than assets
constituting Collateral under the Security Agreement that become subject to the
Lien of the Security Agreement upon acquisition thereof), the Borrower will
notify the Administrative Agent and the Lenders thereof, and, if requested by
the Administrative Agent or the Required Lenders, the Borrower will cause such
assets to be subjected to a Lien securing the Obligations and will take, and
cause the Subsidiary Loan Parties to take, such actions as shall be necessary
or reasonably requested by the Administrative Agent to grant and perfect such
Liens, including actions described in paragraph (a) of this Section, all at the
expense of the Loan Parties.
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SECTION 5.14. INTEREST RATE PROTECTION. As promptly as
practicable, and in any event commencing no later than 60 days after the
Effective Date, the Borrower will enter into, and thereafter for a period of
not less than three years will maintain in effect, interest rate protection
agreements on such terms and with such parties as shall be reasonably
satisfactory to the Administrative Agent, such that the interest cost to the
Borrower with respect to at least 50% of the total Long-Term Indebtedness of
the Borrower and the Subsidiaries will either be hedged by such interest rate
protection agreements or bear interest at a fixed rate.
SECTION 5.15. REDEMPTION OF EXISTING NOTES. On November 15,
1999, if Existing Notes in an aggregate principal amount of $5,000,000 or more
remain outstanding, the Borrower shall redeem all Existing Notes then
outstanding in accordance with the redemption provisions contained in the
indenture governing such Existing Notes.
ARTICLE VI
NEGATIVE COVENANTS
Until the Commitments have expired or terminated and the
principal of and interest on each Loan and all fees payable hereunder have been
paid in full and all Letters of Credit have expired or terminated and all LC
Disbursements shall have been reimbursed, each of Holdings and the Borrower
covenants and agrees with the Lenders that:
SECTION 6.01. INDEBTEDNESS; CERTAIN EQUITY SECURITIES. (a)
The Borrower will not, and will not permit any Restricted Subsidiary to,
create, incur, assume or permit to exist any Indebtedness, except:
(i) Indebtedness created under the Loan Documents;
(ii) the Subordinated Debt;
(iii) any Existing Notes that are not purchased pursuant to
the Debt Tender Offer;
(iv) Indebtedness existing on the date hereof and set forth
in Schedule 6.01 and extensions, renewals and replacements of any such
Indebtedness that do not increase the outstanding principal amount
thereof or result in an earlier maturity date or decreased weighted
average life thereof;
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(v) Indebtedness of the Borrower to any Restricted Subsidiary
and of any Restricted Subsidiary to the Borrower or any other
Restricted Subsidiary;
(vi) Guarantees by the Borrower of Indebtedness of any
Subsidiary and by any Restricted Subsidiary of Indebtedness of the
Borrower or any other Subsidiary; PROVIDED that Guarantees by the
Borrower or any Restricted Subsidiary of Indebtedness of any
Subsidiary that is not a Loan Party shall be subject to Section 6.04;
(vii) Indebtedness of the Borrower or any Restricted
Subsidiary incurred to finance the acquisition, construction or
improvement of any fixed or capital assets, including Capital Lease
Obligations and any Indebtedness assumed in connection with the
acquisition of any such assets or secured by a Lien on any such assets
prior to the acquisition thereof, and extensions, renewals and
replacements of any such Indebtedness that do not increase the
outstanding principal amount thereof; PROVIDED that (A) such
Indebtedness is incurred prior to or within 90 days after such
acquisition or the completion of such construction or improvement and
(B) the aggregate principal amount of Indebtedness permitted by this
clause (vii) at any time outstanding shall not exceed $10,000,000;
(viii) Indebtedness of any Person that becomes a Restricted
Subsidiary after the date hereof and extensions, renewals and
replacements of any such Indebtedness that do not increase the
outstanding principal amount thereof; PROVIDED that such Indebtedness
exists at the time such Person becomes a Subsidiary and is not created
in contemplation of or in connection with such Person becoming a
Subsidiary;
(ix) other unsecured Indebtedness in an aggregate principal
amount not exceeding $25,000,000 at any time outstanding; and
(x) other unsecured Indebtedness in an aggregate principal
amount not exceeding $25,000,000 at any time outstanding; PROVIDED
that, at the time of and after giving effect to the incurrence of any
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such Indebtedness permitted by this clause (x), the Leverage Ratio
(determined for this purpose based on Consolidated EBITDA for the
period of four consecutive fiscal quarters most recently ended for
which financial statements have been delivered pursuant to clause (a)
or (b) of Section 5.01) shall not exceed 5.0 to 1.0.
(b) Holdings will not create, incur, assume or permit to
exist any Indebtedness except (i) Indebtedness created under the Loan Documents
and (ii) the Holdings Discount Notes.
(c) Neither Holdings nor the Borrower will, nor will they
permit any Restricted Subsidiary to, (i) issue any preferred stock or other
preferred Equity Interests (other than preferred stock issued by Holdings that
is not Disqualified Stock) or (ii) designate any other Indebtedness as
"Designated Senior Indebtedness" under and as defined in the Subordinated Debt
Documents.
SECTION 6.02. LIENS. (a) The Borrower will not, and will not
permit any Restricted Subsidiary to, create, incur, assume or permit to exist
any Lien on any property or asset now owned or hereafter acquired by it, or
assign or sell any income or revenues (including accounts receivable) or rights
in respect of any thereof, except:
(i) Liens created under the Loan Documents;
(ii) Permitted Encumbrances;
(iii) any Lien on any property or asset of the Borrower or
any Restricted Subsidiary existing on the date hereof and set forth in
Schedule 6.02; PROVIDED that (A) such Lien shall not apply to any
other property or asset of the Borrower or any Restricted Subsidiary
and (B) such Lien shall secure only those obligations which it secures
on the date hereof and extensions, renewals and replacements thereof
that do not increase the outstanding principal amount thereof;
(iv) any Lien existing on any property or asset prior to the
acquisition thereof by the Borrower or any Subsidiary or existing on
any property or asset of any Person that becomes a Subsidiary after
the date hereof prior to the time such Person becomes a Subsidiary;
PROVIDED that (A) such Lien is not created in contemplation of or in
connection with such acquisition or such Person becoming a Subsidiary,
as the case may be, (B) such Lien shall not apply to any other
property or assets of the Borrower or any Restricted Subsidiary and
(C) such Lien shall secure only those obligations which it secures on
the date of such acquisition or the date such Person becomes a
Subsidiary, as the case may be and extensions, renewals and
replacements thereof that do not increase the outstanding principal
amount thereof;
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(v) Liens on fixed or capital assets acquired, constructed or
improved by the Borrower or any Restricted Subsidiary; PROVIDED that
(A) such security interests secure Indebtedness permitted by clause
(vii) of Section 6.01(a), (B) such security interests and the
Indebtedness secured thereby are incurred prior to or within 90 days
after such acquisition or the completion of such construction or
improvement, (C) the Indebtedness secured thereby does not exceed 100%
of the cost of acquiring, constructing or improving such fixed or
capital assets and (D) such security interests shall not apply to any
other property or assets of the Borrower or any Restricted Subsidiary;
(vi) Liens arising by operation of law that secure obligations
in an aggregate amount not to exceed $5,000,000 at any time
outstanding, including Liens imposed pursuant to Environmental Laws
securing obligations not reasonably expected to exceed such amount; and
(vii) any sale or assignment of accounts receivable permitted
by clause (c) of Section 6.05.
(b) Holdings will not create, incur, assume or permit to
exist any Lien on any property or asset now owned or hereafter acquired by it,
or assign or sell any income or revenues (including accounts receivable) or
rights in respect thereof, except Liens created under the Security Documents
and Permitted Encumbrances.
SECTION 6.03. FUNDAMENTAL CHANGES. (a) Neither Holdings nor
the Borrower will, nor will they permit any Restricted Subsidiary to, merge
into or consolidate with any other Person, or permit any other Person to merge
into or consolidate with it, or liquidate or dissolve, except that, if at the
time thereof and immediately after giving effect thereto no Default shall have
occurred and be continuing (i) any Person may merge into the Borrower in a
transaction in which the Borrower is the surviving corporation, (ii) any Person
may merge into any Restricted Subsidiary in a transaction in which the
surviving entity is a Restricted Subsidiary and (if any party to such merger is
a Subsidiary Loan Party) is a Subsidiary Loan Party and (iii) any Restricted
Subsidiary (other than a Subsidiary Loan Party) may liquidate or dissolve if
the Borrower determines in good faith that such liquidation or dissolution is
in the best interests of the Borrower and is not materially disadvantageous to
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the Lenders; PROVIDED that (A) the foregoing shall not be construed to prohibit
the Merger and (B) any such merger involving a Person that is not a wholly
owned Restricted Subsidiary immediately prior to such merger shall not be
permitted unless also permitted by Section 6.04.
(b) The Borrower will not, and will not permit any of its
Restricted Subsidiaries to, engage to any material extent in any business other
than businesses of the type conducted by the Borrower and its Restricted
Subsidiaries on the date of execution of this Agreement and businesses
reasonably related thereto.
(c) Holdings will not engage in any business or activity
other than the ownership of shares of capital stock of the Borrower and
activities incidental thereto. Holdings will not own or acquire any assets
(other than shares of capital stock of the Borrower, cash and Permitted
Investments) or incur any liabilities (other than liabilities under the Loan
Documents, the Holdings Discount Notes Documents, liabilities imposed by law,
including tax liabilities, and other liabilities incidental to its existence
and permitted business and activities).
(d) Holdings shall not enter into any agreement relating to
the voting of any Equity Interests in the Borrower held by it except (i) with
respect to the election of directors of the Borrower; PROVIDED that Holdings
retains the direct or indirect power to appoint at least 80% of the directors
of the Borrower and (ii) to grant to any other holder of common stock of the
Borrower the right to approve the taking of any action by the Borrower that
would also require the approval in writing of the Lenders or the Required
Lenders, as applicable, under the terms and conditions of this Agreement or the
other Loan Documents.
(e) Holdings shall not sell or otherwise transfer any Equity
Interests of the Borrower to any Person unless (i) all the Equity Interests of
the Borrower sold or otherwise transferred to Persons other than Holdings
consist of common stock, (ii) either (A) all the common stock of the Borrower
consists of common stock of the same class and has the same rights (including
voting rights) and privileges or (B) the common stock of the Borrower that is
owned by Persons other than Holdings either does not entitle the holders
thereof to voting rights or, in the aggregate, entitles the holders thereof to
not more than 20% of the total voting power of all classes of voting common
stock of the Borrower, and (iii) all such Equity Interests are pledged to the
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Collateral Agent for the benefit of the Secured Parties pursuant to a pledge
agreement that is substantially the same as the Pledge Agreement so that, after
giving effect to all such sales or other transfers of Equity Interests of the
Borrower, 100% of the capital stock of the Borrower remains pledged to secure
the Obligations (as defined in the Pledge Agreement).
(f) The Borrower shall not issue any Equity Interests to any
Person other than Holdings unless (i) all the Equity Interests of the Borrower
issued to Persons other than Holdings consist of common stock, (ii) either (A)
all the common stock of the Borrower consists of common stock of the same class
and has the same rights (including voting rights) and privileges or (B) the
common stock of the Borrower that is owned by Persons other than Holdings
either does not entitle the holders thereof to voting rights or, in the
aggregate, entitles the holders thereof to not more than 20% of the total
voting power of all classes of voting common stock of the Borrower, and (iii)
all such Equity Interests are pledged to the Collateral Agent for the benefit
of the Secured Parties pursuant to a pledge agreement that is substantially the
same as the Pledge Agreement so that, after giving effect to all such issuances
of Equity Interests of the Borrower, 100% of the capital stock of the Borrower
remains pledged to secure the Obligations (as defined in the Pledge Agreement).
SECTION 6.04. INVESTMENTS, LOANS, ADVANCES, GUARANTEES AND
ACQUISITIONS. The Borrower will not, and will not permit any of its Restricted
Subsidiaries to, purchase, hold or acquire (including pursuant to any merger
with any Person that was not a wholly owned Restricted Subsidiary prior to such
merger) any Equity Interests in or 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, except:
(a) the Acquisition;
(b) Permitted Investments;
(c) investments existing on the date hereof and set forth on
Schedule 6.04;
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(d) investments by the Borrower and its Restricted
Subsidiaries in Equity Interests in their respective Subsidiaries;
PROVIDED that (i) any such Equity Interests in a Subsidiary held by a
Loan Party shall be pledged pursuant to the Pledge Agreement (subject
to the limitations applicable to the pledge of Equity Interests in
Foreign Subsidiaries set forth in Section 5.12), (ii) the aggregate
amount of investments by Loan Parties in, and loans and advances by
Loan Parties to, and Guarantees by Loan Parties of Indebtedness of,
Unrestricted Subsidiaries (including all such investments, loans,
advances and Guarantees existing on the Effective Date) shall not
exceed $25,000,000 at any time outstanding (it being understood that,
for purposes of determining outstanding investments in Unrestricted
Subsidiaries, the sale or disposition by a Loan Party of an investment
in an Unrestricted Subsidiary shall be deemed to reduce investments in
Unrestricted Subsidiaries by an amount equal to the Net Proceeds of
such sale or disposition) and (iii) the aggregate amount of
investments by Loan Parties in, and loans and advances by Loan Parties
to, and Guarantees by Loan Parties of Indebtedness of, Restricted
Subsidiaries that are Foreign Subsidiaries (including all such
investments, loans, advances and Guarantees existing on the Effective
Date) shall not exceed 5% of Total Assets at any time outstanding (it
being understood that, for purposes of determining outstanding
investments in Restricted Subsidiaries that are Foreign Subsidiaries,
the sale or disposition by a Loan Party of an investment in a
Restricted Subsidiary that is a Foreign Subsidiary shall be deemed to
reduce investments in Restricted Subsidiaries that are Foreign
Subsidiaries by an amount equal to the Net Proceeds of such sale or
disposition);
(e) loans or advances made by the Borrower to any Subsidiary
and made by any Restricted Subsidiary to the Borrower or any other
Subsidiary; PROVIDED that the amount of such loans and advances made
by Loan Parties to Unrestricted Subsidiaries, or to Restricted
Subsidiaries that are Foreign Subsidiaries, shall be subject to the
limitations set forth in clause (d) above;
(f) Guarantees constituting Indebtedness permitted by Section
6.01; PROVIDED that (i) a Restricted Subsidiary shall not Guarantee
the Subordinated Debt unless (A) such Restricted Subsidiary also has
Guaranteed the Obligations pursuant to the Guarantee Agreement, (B)
such Guarantee of the Subordinated Debt is subordinated to such
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Guarantee of the Obligations on terms no less favorable to the Lenders
than the subordination provisions of the Subordinated Debt and (C)
such Guarantee of the Subordinated Debt provides for the release and
termination thereof, without action by any party, upon the sale or
transfer of the Equity Interests of such Restricted Subsidiary as a
result of a foreclosure of the Lien on such Equity Interests that
secures the Obligations, where (1) after such sale or transfer, such
Restricted Subsidiary is no longer a Subsidiary and (2) the Net
Proceeds resulting from such sale or transfer are applied in
accordance with the terms of the Subordinated Debt Documents that
would apply to a sale of such Equity Interests by the Borrower, and
(ii) the aggregate principal amount of Indebtedness of Unrestricted
Subsidiaries, or of Restricted Subsidiaries that are Foreign
Subsidiaries, that is Guaranteed by any Loan Party shall be subject to
the limitations set forth in clause (d) above;
(g) investments received in connection with the bankruptcy or
reorganization of, or settlement of delinquent accounts and disputes
with, customers and suppliers, in each case in the ordinary course of
business;
(h) Permitted Acquisitions; PROVIDED that the sum of all
consideration (other than common Equity Interests of Holdings) paid or
otherwise delivered in connection with Permitted Acquisitions
(including the principal amount of any Indebtedness issued as deferred
purchase price and the fair market value of any other non-cash
consideration but excluding the amount of Net Proceeds from Prepayment
Events described in clause (a) of the definition of the term
Prepayment Event that are applied, in accordance with Section 2.11(c),
to make such Permitted Acquisitions) plus the aggregate principal
amount of all Indebtedness otherwise incurred or assumed in connection
with, or resulting from, Permitted Acquisitions (including
Indebtedness of any acquired Persons outstanding at the time of the
applicable Permitted Acquisition) shall not exceed, on a cumulative
basis during the term of this Agreement, $50,000,000;
(i) any investments in or loans to any other Person received
as noncash consideration for sales, transfers, leases and other
dispositions permitted by Section 6.05; and
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(j) any other investments in, advances or loans to or
Guarantees of Indebtedness of, any Person in an aggregate amount not
to exceed $25,000,000 at any time outstanding.
SECTION 6.05. ASSET SALES. The Borrower will not, and will
not permit any of its Restricted Subsidiaries to, sell, transfer, lease or
otherwise dispose of any asset, including any Equity Interest owned by it, nor
will the Borrower permit any of its Restricted Subsidiaries to issue any
additional Equity Interest in such Restricted Subsidiary, except:
(a) sales of inventory, used or surplus equipment and
Permitted Investments in the ordinary course of business;
(b) sales, transfers and dispositions to the Borrower or a
Restricted Subsidiary;
(c) sales of accounts receivable (i) that are delinquent or
the amount of which is in dispute, in each case in connection with the
compromise or collection thereof in the ordinary course of business,
or (ii) of any account debtor in connection with the termination,
wind-down or restructuring of the relationship with such account
debtor in the ordinary course of business;
(d) sales, transfers and dispositions of any Equity Interests
of, loans or advances to, or other investments in, any Unrestricted
Subsidiary; and
(e) sales, transfers and other dispositions of assets (other
than Equity Interests in a Subsidiary) that are not permitted by any
other clause of this Section; PROVIDED that the aggregate fair market
value of all assets sold, transferred or otherwise disposed of in
reliance upon this clause (e) shall not exceed $30,000,000 in the
aggregate during the term of this Agreement;
PROVIDED that all sales, transfers, leases and other dispositions permitted
hereby (other than those permitted by clause (b) above) shall be made for fair
value and for at least 80% cash consideration and PROVIDED, FURTHER, that the
aggregate non-cash consideration received for all sales, transfers, leases and
other dispositions permitted hereby shall not exceed $10,000,000.
SECTION 6.06. SALE AND LEASEBACK TRANSACTIONS. The Borrower
will not, and will not permit any of its Restricted Subsidiaries to, enter into
any arrangement, directly or indirectly, whereby it shall sell or transfer any
property, real or personal, used or useful in its business, whether now owned
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or hereinafter acquired, and thereafter rent or lease such property or other
property that it intends to use for substantially the same purpose or purposes
as the property sold or transferred, except for any such sale of any fixed or
capital assets that is made for cash consideration in an amount not less than
the cost of such fixed or capital asset and is consummated within 90 days after
the Borrower or such Subsidiary acquires or completes the construction of such
fixed or capital asset.
SECTION 6.07. HEDGING AGREEMENTS. The Borrower will not, and
will not permit any of its Restricted Subsidiaries to, enter into any Hedging
Agreement, other than (a) Hedging Agreements required by Section 5.14 and (b)
Hedging Agreements entered into in the ordinary course of business to hedge or
mitigate risks to which the Borrower or any Restricted Subsidiary is exposed in
the conduct of its business or the management of its liabilities.
SECTION 6.08. RESTRICTED PAYMENTS; CERTAIN PAYMENTS OF
INDEBTEDNESS. (a) Other than the payment of amounts payable under the
Acquisition Documents as consideration for the Acquisition (or paying a
dividend to Holdings to enable Holdings to make any such payment), neither
Holdings nor the Borrower will, nor will they permit any Restricted Subsidiary
to, declare or make, or agree to pay or make, directly or indirectly, any
Restricted Payment, or incur any obligation (contingent or otherwise) to do so,
except (i) Holdings may declare and pay dividends with respect to its capital
stock payable solely in additional shares of its common stock, (ii)
Subsidiaries may declare and pay dividends ratably with respect to their
capital stock, (iii) Holdings may make Restricted Payments (and the Borrower
may make Restricted Payments to Holdings to enable Holdings to make such
Restricted Payments), not exceeding $2,000,000 during any fiscal year, pursuant
to and in accordance with stock option plans or other benefit plans for
management or employees of the Borrower and its Subsidiaries, (iv) the Borrower
may pay dividends to Holdings at such times and in such amounts, not exceeding
$2,000,000 during any fiscal year, as shall be necessary to permit Holdings to
pay reasonable administrative expenses incurred in the ordinary course of its
business, (v) Holdings may make Restricted Payments (and the Borrower may make
Restricted Payments to Holdings to enable Holdings to make such Restricted
Payments), not exceeding $5,000,000 in any fiscal year and not exceeding
$10,000,000 in the aggregate during the term of this Agreement, to repurchase
Equity Interests in Holdings owned by employees or former employees of the
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Borrower or the Subsidiaries pursuant to the terms of agreements (including
employment agreements) with such employees, (vi) the Borrower may make
Restricted Payments to Holdings to enable Holdings to pay management fees
pursuant to the Management Agreement that are permitted to be paid pursuant to
clause (c) of Section 6.09, (vii) the Borrower may make Restricted Payments to
Holdings at such times and in such amounts (but not prior to the fifth
anniversary of the date of issuance of the Holdings Discount Notes) as shall be
necessary to enable Holdings (A) on the fifth anniversary of the date of
issuance of the Holdings Discount Notes, to redeem the amount of Holdings
Discount Notes equal to the Holdings Discount Notes Redemption Amount and (B)
after such fifth anniversary, to make interest payments in cash on such
Holdings Discount Notes as and when due; PROVIDED, that at the time of and
after giving effect to each Restricted Payment made in reliance upon this
clause (vii), the Borrower and its Restricted Subsidiaries are in compliance
with the covenants contained in Sections 6.12 and 6.13 as of the end of the
most recent fiscal quarter for which financial statements are available
assuming that Total Debt or Total Senior Debt, as applicable, as of the last
day of such quarter had been equal to the Total Debt or Total Senior Debt, as
applicable, as of the date of such Restricted Payment after giving effect to
such Restricted Payment, and (viii) Holdings and the Borrower may make
additional Restricted Payments for the purposes contemplated by clauses (iii)
through (v) of this Section 6.08(a) in an aggregate amount not to exceed
$5,000,000 during the term of this Agreement; PROVIDED that any Restricted
Payment otherwise permitted by clause (iii) and clauses (v) through (viii)
above shall not be permitted if at the time thereof and after giving effect
thereto a Default shall have occurred and be continuing; PROVIDED FURTHER, that
the provisions of clauses (iii) through (viii) above that permit certain
dividends or other Restricted Payments to Holdings shall not be construed to
permit the payment of dividends or other Restricted Payments to any other
holder of Equity Interests of the Borrower.
(b) Neither Holdings nor the Borrower will, nor will they
permit any Restricted Subsidiary to, make or agree to pay or make, directly or
indirectly, any payment or other distribution (whether in cash, securities or
other property) of or in respect of principal of or interest on any
Indebtedness, or any payment or other distribution (whether in cash, securities
or other property), including any sinking fund or similar deposit, on account
of the purchase, redemption, retirement, acquisition, cancelation or
termination of any Indebtedness, except:
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(i) payment of Indebtedness created under the Loan Documents;
(ii) payment of regularly scheduled interest and principal
payments as and when due in respect of any Indebtedness, other than
payments in respect of the Subordinated Debt or Existing Notes
prohibited by the subordination provisions thereof;
(iii) refinancings of Indebtedness to the extent permitted by
Section 6.01;
(iv) payment of secured Indebtedness that becomes due as a
result of the voluntary sale or transfer of the property or assets
securing such Indebtedness;
(v) repayment of all amounts outstanding under the Existing
Credit Agreement and purchase of the Existing Notes accepted for
payment pursuant to the Debt Tender Offer, in each case on the
Effective Date; and
(vi) redemption of any Existing Notes that remain outstanding
after consummation of the Debt Tender Offer.
SECTION 6.09. TRANSACTIONS WITH AFFILIATES. Neither Holdings
nor the Borrower will, nor will they permit any Restricted Subsidiary to, sell,
lease or otherwise transfer any property or assets to, or purchase, lease or
otherwise acquire any property or assets from, or otherwise engage in any other
transactions with, any of its Affiliates, except (a) transactions that do not
involve Holdings and are at prices and on terms and conditions not less
favorable to the Borrower or such Restricted Subsidiary than could be obtained
on an arm's-length basis from unrelated third parties, (b) transactions between
or among the Borrower and the Subsidiary Loan Parties not involving any other
Affiliate, (c) to pay management fees in accordance with the Management
Agreement in an aggregate amount not to exceed $750,000 in any fiscal year and
(d) any Restricted Payment permitted by Section 6.08.
SECTION 6.10. RESTRICTIVE AGREEMENTS. Neither Holdings nor
the Borrower will, nor will they permit any Restricted Subsidiary to, directly
or indirectly, enter into, incur or permit to exist any agreement or other
arrangement that prohibits, restricts or imposes any condition upon (a) the
ability of Holdings, the Borrower or any Restricted Subsidiary to create, incur
or permit to exist any Lien upon any of its property or assets, or (b) the
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ability of any Restricted Subsidiary to pay dividends or other distributions
with respect to any shares of its capital stock or to make or repay loans or
advances to the Borrower or any other Restricted Subsidiary or to Guarantee
Indebtedness of the Borrower or any other Restricted Subsidiary; PROVIDED that
(i) the foregoing shall not apply to restrictions and conditions imposed by law
or by any Loan Document or Subordinated Debt Document, (ii) the foregoing shall
not apply to restrictions and conditions existing on the date hereof identified
on Schedule 6.10 (but shall apply to any amendment or modification expanding
the scope of any such restriction or condition), (iii) the foregoing shall not
apply to customary restrictions and conditions contained in agreements relating
to the sale of a Subsidiary pending such sale, provided such restrictions and
conditions apply only to the Subsidiary that is to be sold and such sale is
permitted hereunder, (iv) clause (a) of the foregoing shall not apply to
restrictions or conditions imposed by any agreement relating to secured
Indebtedness permitted by this Agreement if such restrictions or conditions
apply only to the property or assets securing such Indebtedness and (v) clause
(a) of the foregoing shall not apply to customary provisions in leases
restricting the assignment thereof.
SECTION 6.11. AMENDMENT OF MATERIAL DOCUMENTS. Neither
Holdings nor the Borrower will, nor will they permit any Subsidiary to, amend,
modify or waive any of its rights under (a) any Subordinated Debt Document, (b)
its certificate of incorporation, by-laws or other organizational documents,
(c) the Existing Notes Indenture other than as contemplated by the Debt Tender
Offer, (d) the LLC Agreement, (e) the Management Agreement and (f) the Holdings
Discount Notes Documents, in each case in any manner that is adverse to the
interests of the Lenders or the Loan Parties.
SECTION 6.12. LEVERAGE RATIO. The Borrower will not permit
the Leverage Ratio as of the last day of any fiscal quarter ending on any date
during any period set forth below to exceed the ratio set forth below opposite
such period:
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PERIOD RATIO
------ -----
September 27, 1999 to and
including March 31, 2000 6.50 to 1.00
April 1, 2000 to and including
September 30, 2000 6.25 to 1.00
October 1, 2000 to and including
March 31, 2001 5.75 to 1.00
April 1, 2001 to and including
March 31, 2002 5.25 to 1.00
April 1, 2002 to and including
March 31, 2003 4.75 to 1.00
April 1, 2003 to and including
March 31, 2004 4.25 to 1.00
Thereafter 4.00 to 1.00
SECTION 6.13. SENIOR LEVERAGE RATIO. The Borrower will not
permit the Senior Leverage Ratio as of the last day of any fiscal quarter
ending on any date during any period set forth below to exceed the ratio set
forth below opposite such period:
PERIOD RATIO
------ -----
September 27, 1999 to and
including September 30, 2000 4.25 to 1.00
October 1, 2000 to and including
March 31, 2002 4.00 to 1.00
April 1, 2002 to and including
March 31, 2003 3.75 to 1.00
April 1, 2003 to and including
March 31, 2004 3.50 to 1.00
Thereafter 3.00 to 1.00
SECTION 6.14. CONSOLIDATED INTEREST EXPENSE COVERAGE RATIO.
The Borrower will not permit the ratio of (a) Consolidated EBITDA to (b)
Consolidated Interest Expense for any period of four consecutive fiscal
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quarters ending on any date during any period set forth below to be less than
the ratio set forth below opposite such period:
PERIOD RATIO
------ -----
September 27, 1999 to and
including December 31, 1999 1.50 to 1.00
January 1, 2000 to and including
June 30, 2000 1.55 to 1.00
July 1, 2000 to and including
December 31, 2000 1.65 to 1.00
January 1, 2001 to and including
June 30, 2001 1.90 to 1.00
July 1, 2001 to and including
March 31, 2002 2.00 to 1.00
April 1, 2002 to and including
March 31, 2003 2.25 to 1.00
Thereafter 2.50 to 1.00
For purposes of determining compliance with this Section 6.14, Consolidated
Interest Expense for the period of four consecutive fiscal quarters ended (i)
September 27, 1999, shall be deemed to be equal to the product of Consolidated
Interest Expense for the fiscal quarter then ended multiplied by four, (ii)
December 27, 1999, shall be deemed to be equal to the product of Consolidated
Interest Expense for the two consecutive fiscal quarters then ended multiplied
by two and (iii) March 27, 2000, shall be deemed to be equal to the product of
Consolidated Interest Expense for the three consecutive fiscal quarters then
ended multiplied by four-thirds.
SECTION 6.15. CONSOLIDATED FIXED CHARGE COVERAGE RATIO. The
Borrower will not permit the ratio of (a) Consolidated EBITDA minus Taxes paid
in cash by Holdings, the Borrower and its Restricted Subsidiaries to (b)
Consolidated Fixed Charges for any period of four consecutive fiscal quarters
ending on any date on or after September 27, 1999, to be less than 1.10 to
1.00. For purposes of determining compliance with this Section 6.15,
Consolidated Fixed Charges for the period of four consecutive fiscal quarters
ended (i) September 27, 1999, shall be deemed to be equal to the product of
Consolidated Fixed Charges for the fiscal quarter then ended multiplied by
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four, (ii) December 27, 1999, shall be deemed to be equal to the product of
Consolidated Fixed Charges for the two consecutive fiscal quarters then ended
multiplied by two and (iii) March 27, 2000, shall be deemed to be equal to the
product of Consolidated Fixed Charges for the three consecutive fiscal quarters
then ended multiplied by four-thirds.
SECTION 6.16. CAPITAL EXPENDITURES. The Borrower and its
Restricted Subsidiaries shall not incur or make Capital Expenditures during any
fiscal year ending on a date set forth below in excess of the amount set forth
below opposite such date:
Fiscal Year Ending Amount
------------------ ------
March 27, 2000 $17,500,000
March 26, 2001 $18,500,000
March 25, 2002 $19,000,000
March 27, 2003 and thereafter $20,000,000
PROVIDED that 50% of the unused amount of any Capital Expenditures permitted to
be made during each fiscal year and not made during such fiscal year may be
carried over and expended during the next succeeding fiscal year (and any
amount so carried over shall be deemed the first amount applied and expended
for Capital Expenditures during such next succeeding fiscal year).
ARTICLE VII
EVENTS OF DEFAULT
If any of the following events ("EVENTS OF DEFAULT") shall
occur:
(a) the Borrower shall fail to pay any principal of any Loan
or any reimbursement obligation in respect of any LC Disbursement when
and as the same shall become due and payable, whether at the due date
thereof or at a date fixed for prepayment thereof or otherwise;
(b) the Borrower shall fail to pay any interest on any Loan
or any fee or any other amount (other than an amount referred to in
clause (a) of this Article) payable under this Agreement or any other
Loan Document, when and as the same shall become due and payable, and
such failure shall continue unremedied for a period of three Business
Days;
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(c) any representation or warranty made or deemed made by or
on behalf of Holdings, the Borrower or any Subsidiary in or in
connection with any Loan Document or any amendment or modification
thereof or waiver thereunder, or in any report, certificate, financial
statement or other document furnished pursuant to or in connection
with any Loan Document or any amendment or modification thereof or
waiver thereunder, shall prove to have been incorrect (or, in the case
of any such representation or warranty that is not qualified as to
materiality, incorrect in any material respect) when made or deemed
made;
(d) Holdings or the Borrower shall fail to observe or perform
any covenant, condition or agreement contained in Section 5.02, 5.04
(with respect to the existence of Holdings or the Borrower) or 5.11 or
in Article VI;
(e) any Loan Party shall fail to observe or perform any
covenant, condition or agreement contained in any Loan Document (other
than those specified in clause (a), (b) or (d) of this Article), and
such failure shall continue unremedied for a period of 30 days after
notice thereof from the Administrative Agent to the Borrower (which
notice will be given at the request of any Lender);
(f) Holdings, the Borrower or any Restricted Subsidiary shall
fail to make any payment of principal or interest (regardless of
amount) in respect of any Material Indebtedness, when and as the same
shall become due and payable (after giving effect to any applicable
period of grace, in the case of interest);
(g) any event or condition occurs that results in any
Material Indebtedness becoming due prior to its scheduled maturity or
that enables or permits the holder or holders of any Material
Indebtedness or any trustee or agent on its or their behalf to cause
any Material Indebtedness to become due, or to require the prepayment,
repurchase, redemption or defeasance thereof, prior to its scheduled
maturity; PROVIDED that this clause (g) shall not apply to secured
Indebtedness that becomes due as a result of the voluntary sale or
transfer of the property or assets securing such Indebtedness;
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(h) an involuntary proceeding shall be commenced or an
involuntary petition shall be filed seeking (i) liquidation,
reorganization or other relief in respect of Holdings, the Borrower or
any Restricted Subsidiary or its debts, or of a substantial part of
its assets, under any Federal, state or foreign bankruptcy,
insolvency, receivership or similar law now or hereafter in effect or
(ii) the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for Holdings, the Borrower or any
Restricted Subsidiary or for a substantial part of its assets, and, in
any such case, such proceeding or petition shall continue undismissed
for 60 days or an order or decree approving or ordering any of the
foregoing shall be entered;
(i) Holdings, the Borrower or any Restricted Subsidiary shall
(i) voluntarily commence any proceeding or file any petition seeking
liquidation, reorganization or other relief under any Federal, state
or foreign bankruptcy, insolvency, receivership or similar law now or
hereafter in effect, (ii) consent to the institution of, or fail to
contest in a timely and appropriate manner, any proceeding or petition
described in clause (h) of this Article, (iii) apply for or consent to
the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for Holdings, the Borrower or any
Restricted Subsidiary or for a substantial part of its assets, (iv)
file an answer admitting the material allegations of a petition filed
against it in any such proceeding, (v) make a general assignment for
the benefit of creditors or (vi) take any action for the purpose of
effecting any of the foregoing;
(j) Holdings, the Borrower or any Restricted Subsidiary shall
become unable, admit in writing its inability or fail generally to pay
its debts as they become due;
(k) one or more judgments for the payment of money in an
aggregate amount in excess of $5,000,000 shall be rendered against
Holdings, the Borrower, any Restricted Subsidiary or any combination
thereof and the same shall remain undischarged for a period of 30
consecutive days during which execution shall not be effectively
stayed, or any action shall be legally taken by a judgment creditor to
attach or levy upon any assets of Holdings, the Borrower or any
Restricted Subsidiary to enforce any such judgment;
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(l) an ERISA Event shall have occurred that, when taken
together with all other ERISA Events that have occurred, could
reasonably be expected to result in a Material Adverse Effect;
(m) any Lien purported to be created under any Security
Document shall cease to be, or shall be asserted by any Loan Party not
to be, a valid and perfected Lien on any Collateral, with the priority
required by the applicable Security Document, except (i) as a result
of the sale or other disposition of the applicable Collateral in a
transaction permitted under the Loan Documents or (ii) as a result of
the Administrative Agent's failure to maintain possession of any stock
certificates, promissory notes or other instruments delivered to it
under the Collateral Agreement; or
(n) a Change in Control shall occur;
then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower, take either
or both of the following actions, at the same or different times: (i) terminate
the Commitments, and thereupon the Commitments shall terminate immediately, and
(ii) declare the Loans then outstanding to be due and payable in whole (or in
part, in which case any principal not so declared to be due and payable may
thereafter be declared to be due and payable), and thereupon the principal of
the Loans so declared to be due and payable, together with accrued interest
thereon and all fees and other obligations of the Borrower accrued hereunder,
shall become due and payable immediately, without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by the Borrower;
and in case of any event with respect to the Borrower described in clause (h)
or (i) of this Article, the Commitments shall automatically terminate and the
principal of the Loans then outstanding, together with accrued interest thereon
and all fees and other obligations of the Borrower accrued hereunder, shall
automatically become due and payable, without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrower.
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ARTICLE VIII
THE AGENTS
Each of the Lenders and the Issuing Bank hereby irrevocably
appoints The Chase Manhattan Bank as Administrative Agent and Collateral Agent
(for purposes of this Article VIII, collectively, the "AGENT") and authorizes
the Agent to take such actions on its behalf and to exercise such powers as are
delegated to the Agent by the terms of the Loan Documents, together with such
actions and powers as are reasonably incidental thereto.
The bank serving as the Agent hereunder shall have the same
rights and powers in its capacity as a Lender as any other Lender and may
exercise the same as though it were not the Agent, and such bank and its
Affiliates may accept deposits from, lend money to and generally engage in any
kind of business with Holdings, the Borrower or any Subsidiary or other
Affiliate thereof as if it were not the Agent hereunder.
The Agent shall not have any duties or obligations except
those expressly set forth in the Loan Documents. Without limiting the
generality of the foregoing, (a) the Agent shall not be subject to any
fiduciary or other implied duties, regardless of whether a Default has occurred
and is continuing, (b) the Agent shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated by the Loan Documents that the Agent
is required to exercise in writing by the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02), and (c) except as expressly set
forth in the Loan Documents, the Agent shall not have any duty to disclose, and
shall not be liable for the failure to disclose, any information relating to
Holdings, the Borrower or any of its Subsidiaries that is communicated to or
obtained by the bank serving as Agent or any of its Affiliates in any capacity.
The Agent shall not be liable for any action taken or not taken by it with the
consent or at the request of the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02) or in the absence of its own gross negligence or
wilful misconduct. The Agent shall be deemed not to have knowledge of any
Default unless and until written notice thereof is given to the Agent by
Holdings, the Borrower or a Lender, and the Agent shall not be responsible for
or have any duty to ascertain or inquire into (i) any statement, warranty or
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representation made in or in connection with any Loan Document, (ii) the
contents of any certificate, report or other document delivered thereunder or
in connection therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth in any Loan
Document, (iv) the validity, enforceability, effectiveness or genuineness of
any Loan Document or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in Article IV or elsewhere in any Loan
Document, other than to confirm receipt of items expressly required to be
delivered to the Agent.
The Agent shall be entitled to rely upon, and shall not incur
any liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed or sent by the proper Person. The Agent also may rely
upon any statement made to it orally or by telephone and believed by it to be
made by the proper Person, and shall not incur any liability for relying
thereon. The Agent may consult with legal counsel (who may be counsel for the
Borrower), independent accountants and other experts selected by it, and shall
not be liable for any action taken or not taken by it in accordance with the
advice of any such counsel, accountants or experts.
The Agent may perform any and all its duties and exercise its
rights and powers by or through any one or more sub-agents appointed by the
Agent. The Agent and any such sub-agent may perform any and all its duties and
exercise its rights and powers through their respective Related Parties. The
exculpatory provisions of the preceding paragraphs shall apply to any such
sub-agent and to the Related Parties of each Agent and any such sub-agent, and
shall apply to their respective activities in connection with the syndication
of the credit facilities provided for herein as well as activities as Agent.
Subject to the appointment and acceptance of a successor
Agent as provided in this paragraph, the Agent may resign at any time by
notifying the Lenders, the Issuing Bank and the Borrower. Upon any such
resignation, the Required Lenders shall have the right, in consultation with
the Borrower, to appoint a successor. If no successor shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within 30 days after the retiring Agent gives notice of its resignation, then
the retiring Agent may, on behalf of the Lenders and the Issuing Bank, appoint
a successor Agent which shall be a bank with an office in New York, New York,
or an Affiliate of any such bank. Upon the acceptance of its appointment as
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Agent hereunder by a successor, such successor shall succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
Agent, and the retiring Agent shall be discharged from its duties and
obligations hereunder. The fees payable by the Borrower to a successor Agent
shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrower and such successor. After the Agent's resignation
hereunder, the provisions of this Article and Section 9.03 shall continue in
effect for the benefit of such retiring Agent, its sub-agents and their
respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while it was acting as Agent.
Each Lender acknowledges that it has, independently and
without reliance upon the Agent or any other Lender and based on such documents
and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender also acknowledges that it
will, independently and without reliance upon the Agent or any other Lender and
based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any other Loan Document or related
agreement or any document furnished hereunder or thereunder.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. NOTICES. Except in the case of notices and
other communications expressly permitted to be given by telephone, all notices
and other 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:
(a) if to Holdings or the Borrower, to it at American Media
Operations, Inc., 600 East Coast Avenue, Lantana, Florida 33464-0002,
Attention of Richard W. Pickert and Peter A. Nelson (Telecopy No.
(561) 540-1018), with a copy to EMP Group L.L.C., 65 East 55th Street,
New York, New York 10022, Attention of Austin M. Beutner (Telecopy No.
(212) 857-3122);
(b) if to the Administrative Agent, to The Chase Manhattan
Bank, Loan and Agency Services Group, One Chase Manhattan Plaza, 8th
Floor, New York, New York 10081, Attention of Janet Belden (Telecopy
No. (212) 552-5658), with a copy to The Chase Manhattan Bank, 270 Park
Avenue, New York, New York 10017, Attention of Ed deForest (Telecopy
No. (212) 270-5120);
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(c) if to the Issuing Bank, to it at The Chase Manhattan
Bank, Loan and Agency Services Group, One Chase Manhattan Plaza, 8th
Floor, New York, New York 10081, Attention of Janet Belden (Telecopy
No. (212) 552-5658);
(d) if to the Swingline Lender, to it at The Chase Manhattan
Bank, Loan and Agency Services Group, One Chase Manhattan Plaza, 8th
Floor, New York, New York 10081, Attention of Janet Belden (Telecopy
No. (212) 552-5658); and
(e) if to any other Lender, to it at its address (or telecopy
number) set forth in its Administrative Questionnaire.
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.
SECTION 9.02. WAIVERS; AMENDMENTS. (a) No failure or delay by
the Administrative Agent, the Collateral Agent, the Issuing Bank or any Lender
in exercising any right or power hereunder or under any other Loan Document
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof
or the exercise of any other right or power. The rights and remedies of the
Administrative Agent, the Collateral Agent, the Issuing Bank and the Lenders
hereunder and under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver
of any provision of any Loan Document or consent to any departure by any Loan
Party therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) of this Section, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given. Without limiting the generality of the foregoing, the making of a Loan
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or issuance of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether the Administrative Agent, the Collateral Agent,
any Lender or the Issuing Bank may have had notice or knowledge of such Default
at the time.
(b) Neither this Agreement nor any other Loan Document nor
any provision hereof or thereof may be waived, amended or modified except, in
the case of this Agreement, pursuant to an agreement or agreements in writing
entered into by Holdings, the Borrower and the Required Lenders or, in the case
of any other Loan Document, pursuant to an agreement or agreements in writing
entered into by the Collateral Agent and the Loan Party or Loan Parties that
are parties thereto, in each case with the consent of the Required Lenders;
PROVIDED that no such agreement shall (i) increase the Commitment of any Lender
without the written consent of such Lender, (ii) reduce the principal amount of
any Loan or LC Disbursement or reduce the rate of interest thereon, or reduce
any fees payable hereunder, without the written consent of each Lender affected
thereby, (iii) postpone the maturity of any Loan, or any scheduled date of
payment of the principal amount of any Term Loan under Section 2.10, or the
required date of reimbursement of any LC Disbursement, or any date for the
payment of any interest or fees payable hereunder, or reduce the amount of,
waive or excuse any such payment, or postpone the scheduled date of expiration
of any Commitment, without the written consent of each Lender affected thereby,
(iv) change Section 2.18(b) or (c) in a manner that would alter the pro rata
sharing of payments required thereby, without the written consent of each
Lender, (v) change any of the provisions of this Section or the percentage set
forth in the definition of "Required Lenders" or any other provision of any
Loan Document specifying the number or percentage of Lenders (or Lenders of any
Class) required to waive, amend or modify any rights thereunder or make any
determination or grant any consent thereunder, without the written consent of
each Lender (or each Lender of such Class, as the case may be), (vi) release
all or any substantial part of the Guarantees made by Holdings and the
Subsidiary Loan Parties under the Guarantee Agreement (except as expressly
provided in the Guarantee Agreement), or limit their liability in respect of
all or any substantial part of such Guarantees, without the written consent of
each Lender, (vii) release all or any substantial part of the Collateral from
the Liens of the Security Documents, without the written consent of each
Lender, (viii) change any provisions of any Loan Document in a manner that by
its terms adversely affects the rights in respect of payments due to Lenders
holding Loans of any Class differently than those holding Loans of any other
Class, without the written consent of Lenders holding a majority in interest of
the outstanding Loans and unused Commitments of each adversely affected Class
or (ix) change the rights of the Tranche B Lenders to decline mandatory
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prepayments as provided in Section 2.11, without the written consent of Tranche
B Lenders holding a majority of the outstanding Tranche B Loans; PROVIDED
FURTHER that (A) no such agreement shall amend, modify or otherwise affect the
rights or duties of the Administrative Agent, the Collateral Agent, the Issuing
Bank or the Swingline Lender without the prior written consent of the
Administrative Agent, the Collateral Agent, the Issuing Bank or the Swingline
Lender, as the case may be, and (B) any waiver, amendment or modification of
this Agreement that by its terms affects the rights or duties under this
Agreement of the Revolving Lenders (but not the Tranche A Lenders and Tranche B
Lenders), the Tranche A Lenders (but not the Revolving Lenders and Tranche B
Lenders) or the Tranche B Lenders (but not the Revolving Lenders and Tranche A
Lenders) may be effected by an agreement or agreements in writing entered into
by Holdings, the Borrower and requisite percentage in interest of the affected
Class of Lenders. Notwithstanding the foregoing, any provision of this
Agreement may be amended by an agreement in writing entered into by the
Borrower, the Required Lenders and the Administrative Agent (and, if their
rights or obligations are affected thereby, the Issuing Bank and the Swingline
Lender) if (i) by the terms of such agreement the Commitment of each Lender not
consenting to the amendment provided for therein shall terminate upon the
effectiveness of such amendment and (ii) at the time such amendment becomes
effective, each Lender not consenting thereto receives payment in full of the
principal of and interest accrued on each Loan made by it and all other amounts
owing to it or accrued for its account under this Agreement.
SECTION 9.03. EXPENSES; INDEMNITY; DAMAGE WAIVER. (a) The
Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the
Administrative Agent, the Collateral Agent and their Affiliates, including the
reasonable fees, charges and disbursements of counsel for the Administrative
Agent and the Collateral Agent, in connection with the syndication of the
credit facilities provided for herein, the preparation and administration of
the Loan Documents or any amendments, modifications or waivers of the
provisions thereof (whether or not the transactions contemplated hereby or
thereby shall be consummated), (ii) all reasonable out-of-pocket expenses
incurred by the Issuing Bank in connection with the issuance, amendment,
renewal or extension of any Letter of Credit or any demand for payment
thereunder and (iii) all out-of-pocket expenses incurred by the Administrative
Agent, the Collateral Agent, the Issuing Bank or any Lender, including the
fees, charges and disbursements of any counsel for the Administrative Agent,
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the Collateral Agent, the Issuing Bank or any Lender, in connection with the
enforcement or protection of its rights in connection with the Loan Documents,
including its rights under this Section, or in connection with the Loans made
or Letters of Credit issued hereunder, including all such out-of-pocket
expenses incurred during any workout, restructuring or negotiations in respect
of such Loans or Letters of Credit.
(b) The Borrower shall indemnify the Administrative Agent,
the Collateral Agent, the Issuing Bank and each Lender, and each Related Party
of any of the foregoing Persons (each such Person being called an "INDEMNITEE")
against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including the fees, charges and
disbursements of any counsel for any Indemnitee, incurred by or asserted
against any Indemnitee arising out of, in connection with, or as a result of
(i) the execution or delivery of any Loan Document or any other agreement or
instrument contemplated hereby, the performance by the parties to the Loan
Documents of their respective obligations thereunder or the consummation of the
Transactions or any other transactions contemplated hereby, (ii) any Loan or
Letter of Credit or the use of the proceeds therefrom (including any refusal by
the Issuing Bank to honor a demand for payment under a Letter of Credit if the
documents presented in connection with such demand do not strictly comply with
the terms of such Letter of Credit), (iii) any actual or alleged presence or
release of Hazardous Materials on or from any Mortgaged Property or any other
property currently or formerly owned or operated by the Borrower or any of its
Subsidiaries, or any Environmental Liability related in any way to the Borrower
or any of its Subsidiaries, or (iv) any actual or prospective claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether based on contract, tort or any other theory and regardless of whether
any Indemnitee is a party thereto; PROVIDED that such indemnity shall not, as
to any Indemnitee, be available to the extent that such losses, claims,
damages, liabilities or related expenses resulted from the gross negligence or
wilful misconduct of such Indemnitee.
(c) To the extent that the Borrower fails to pay any amount
required to be paid by it to the Administrative Agent, the Collateral Agent,
the Issuing Bank or the Swingline Lender under paragraph (a) or (b) of this
Section, each Lender severally agrees to pay to the Administrative Agent, the
Collateral Agent, the Issuing Bank or the Swingline Lender, as the case may be,
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such Lender's pro rata share (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount;
PROVIDED that the unreimbursed expense or indemnified loss, claim, damage,
liability or related expense, as the case may be, was incurred by or asserted
against the Administrative Agent, the Collateral Agent, the Issuing Bank or the
Swingline Lender in its capacity as such. For purposes hereof, a Lender's "pro
rata share" shall be determined based upon its share of the sum of the total
Revolving Exposures, outstanding Term Loans and unused Commitments at the time.
(d) To the extent permitted by applicable law, neither
Holdings nor the Borrower shall assert, and each hereby waives, any claim
against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement or any
agreement or instrument contemplated hereby, the Transactions, any Loan or
Letter of Credit or the use of the proceeds thereof.
(e) All amounts due under this Section shall be payable
promptly after written demand therefor.
SECTION 9.04. SUCCESSORS AND ASSIGNS. (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 (including
any Affiliate of the Issuing Bank that issues any Letter of Credit), except
that the Borrower may not assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of each Lender (and any
attempted assignment or transfer by the Borrower without such consent shall be
null and void). 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 (including any Affiliate of
the Issuing Bank that issues any Letter of Credit) and, to the extent expressly
contemplated hereby, the Related Parties of each of the Administrative Agent,
the Issuing Bank and the Lenders) any legal or equitable right, remedy or claim
under or by reason of this Agreement.
(b) Any Lender may assign to one or more assignees all or a
portion of its rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans at the time owing to it); PROVIDED that
(i) except in the case of an assignment to a Lender or an Affiliate of a Lender
or a Related Fund of a Lender, each of the Borrower and the Administrative
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Agent (and, in the case of an assignment of all or a portion of a Revolving
Commitment or any Lender's obligations in respect of its LC Exposure or
Swingline Exposure, the Issuing Bank and the Swingline Lender) must give their
prior written consent to such assignment (which consent shall not be
unreasonably withheld), (ii) except in the case of an assignment to a Lender or
an Affiliate of a Lender or a Related Fund of a Lender or an assignment of the
entire remaining amount of the assigning Lender's Commitment or Loans, the
amount of the Commitment or Loans of the assigning Lender subject to each such
assignment (determined as of the date the 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, (iii) 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, except that this clause (iii) shall not be
construed to prohibit the assignment of a proportionate part of all the
assigning Lender's rights and obligations in respect of one Class of
Commitments or Loans, (iv) 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, and (v) the assignee, if it shall
not be a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire; and PROVIDED FURTHER that any consent of the Borrower otherwise
required under this paragraph shall not be required if an Event of Default
under clause (h) or (i) of Article VII has occurred and is continuing. Subject
to acceptance and recording thereof pursuant to paragraph (d) of this Section,
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 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 Sections
2.15, 2.16, 2.17 and 9.03). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this paragraph 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 (e)
of this Section.
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(c) The Administrative Agent, acting for this purpose as an
agent of the Borrower, shall maintain at one of its offices in the City of New
York 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
Commitment of, and principal amount of the Loans and LC Disbursements owing to,
each Lender pursuant to the terms hereof from time to time (the "Register").
The entries in the Register shall be conclusive, and Holdings, the Borrower,
the Administrative Agent, the Issuing Bank 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,
the Issuing Bank and any Lender, at any reasonable time and from time to time
upon reasonable prior notice.
(d) 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 Section and any written consent to such assignment required by
paragraph (b) of this Section, 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.
(e) Any Lender may, without the consent of the Borrower, the
Administrative Agent, the Issuing Bank or the Swingline Lender, 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 and the Loans owing to it);
PROVIDED that (i) such Lender's obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations and (iii) Holdings, the
Borrower, the Administrative Agent, the Issuing Bank 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 the Loan Documents and
to approve any amendment, modification or waiver of any provision of the Loan
Documents; PROVIDED that such agreement or instrument may provide that such
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Lender will not, without the consent of the Participant, agree to any
amendment, modification or waiver described in the first proviso to Section
9.02(b) that affects such Participant. Subject to paragraph (f) of this
Section, the Borrower agrees that each Participant shall be entitled to the
benefits of Sections 2.15, 2.16 and 2.17 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 9.08 as though it were a Lender, provided
such Participant agrees to be subject to Section 2.18(c) as though it were a
Lender.
(f) A Participant shall not be entitled to receive any
greater payment under Section 2.15 or 2.17 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
Foreign Lender if it were a Lender shall not be entitled to the benefits of
Section 2.17 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 Section 2.17(e) as though it were a Lender.
(g) 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 Section 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.
SECTION 9.05. SURVIVAL. All covenants, agreements,
representations and warranties made by the Loan Parties in the Loan Documents
and in the certificates or other instruments delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the other parties hereto and shall survive the
execution and delivery of the Loan Documents and the making of any Loans and
issuance of any Letters of Credit, regardless of any investigation made by any
such other party or on its behalf and notwithstanding that the Administrative
Agent, the Collateral Agent, the Issuing Bank or any Lender may have had notice
or knowledge of any Default or incorrect representation or warranty at the time
any credit is extended hereunder, and shall continue in full force and effect
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as long as the principal of or any accrued interest on any Loan or any fee or
any other amount payable under this Agreement is outstanding and unpaid or any
Letter of Credit is outstanding and so long as the Commitments have not expired
or terminated. The provisions of Sections 2.15, 2.16, 2.17 and 9.03 and Article
VIII shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof.
SECTION 9.06. COUNTERPARTS; INTEGRATION; EFFECTIVENESS. This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. This Agreement,
the other Loan Documents and any separate letter agreements with respect to
fees payable to the Administrative Agent and Collateral Agent constitute the
entire contract among the parties relating to the subject matter hereof and
supersede any and all previous agreements and understandings, oral or written,
relating to the subject matter hereof. Except as provided in Section 4.01, this
Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received
counterparts hereof which, when taken together, bear the signatures of each of
the other parties hereto, and thereafter shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns.
Delivery of an executed counterpart of a signature page of this Agreement by
telecopy shall be effective as delivery of a manually executed counterpart of
this Agreement.
SECTION 9.07. SEVERABILITY. Any provision of this Agreement
held to be invalid, illegal or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such invalidity, illegality
or unenforceability without affecting the validity, legality and enforceability
of the remaining provisions hereof; and the invalidity of a particular
provision in a particular jurisdiction shall not invalidate such provision in
any other jurisdiction.
SECTION 9.08. RIGHT OF SETOFF. If an Event of Default shall
have occurred and be continuing, each Lender and each of its Affiliates 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
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special, time or demand, provisional or final) at any time held and other
obligations at any time owing by such Lender or Affiliate to or for the credit
or the account of the Borrower against any of and all the obligations of the
Borrower now or hereafter existing under this Agreement held by such Lender,
irrespective of whether or not such Lender shall have made any demand under
this Agreement and although such obligations may be unmatured. The rights of
each Lender under this Section are in addition to other rights and remedies
(including other rights of setoff) which such Lender may have.
SECTION 9.09. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE
OF PROCESS. (a) This Agreement shall be construed in accordance with and
governed by the law of the State of New York.
(b) Each of Holdings and the Borrower hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of the Supreme Court of the State of New York sitting in New York
County and of the United States District Court of the Southern District of New
York, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to any Loan Document, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court. Each of the parties hereto agrees that
a final judgment in any such action or proceeding shall be conclusive and may
be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. Nothing in this Agreement or any other Loan Document
shall affect any right that the Administrative Agent, the Collateral Agent, the
Issuing Bank or any Lender may otherwise have to bring any action or proceeding
relating to this Agreement or any other Loan Document against Holdings, the
Borrower or its properties in the courts of any jurisdiction.
(c) Each of Holdings and the Borrower hereby irrevocably and
unconditionally waives, to the fullest extent it may legally and effectively do
so, any objection which it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this Agreement or
any other Loan Document in any court referred to in paragraph (b) of this
Section. Each of the parties hereto hereby irrevocably waives, to the fullest
extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.
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(d) Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in Section 9.01. Nothing
in this Agreement or any other Loan Document will affect the right of any party
to this Agreement to serve process in any other manner permitted by law.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY
HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING
OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.11. HEADINGS. Article and Section headings and the
Table of Contents used herein are for convenience of reference only, are not
part of this Agreement and shall not affect the construction of, or be taken
into consideration in interpreting, this Agreement.
SECTION 9.12. CONFIDENTIALITY. Each of the Administrative
Agent, the Issuing Bank and the Lenders agrees to maintain the confidentiality
of the Information (as defined below), except that Information may be disclosed
(a) to its and its Affiliates' and its Related Funds' directors, officers,
employees and agents, including accountants, legal counsel and other advisors
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential), or to any direct or indirect contractual
counterparty in swap agreements or such contractual counterparty's professional
advisor (so long as such contractual counterparty or professional advisor
agrees to be bound by the provisions of this Section 9.12), (b) to the extent
requested by any regulatory authority, (c) to the extent required by applicable
laws or regulations or by any subpoena or similar legal process, (d) to any
other party to this Agreement, (e) in connection with the exercise of any
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remedies hereunder or any suit, action or proceeding relating to this Agreement
or any other Loan Document or the enforcement of rights hereunder or
thereunder, (f) subject to an agreement containing provisions substantially the
same as those of this Section, to any assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights or obligations
under this Agreement, (g) with the consent of the Borrower or (h) to the extent
such Information (i) becomes publicly available other than as a result of a
breach of this Section or (ii) becomes available to the Administrative Agent,
the Issuing Bank or any Lender on a nonconfidential basis from a source other
than Holdings or the Borrower. For the purposes of this Section, "INFORMATION"
means all information received from Holdings or the Borrower relating to
Holdings or the Borrower or its business, other than any such information that
is available to the Administrative Agent, the Issuing Bank or any Lender on a
nonconfidential basis prior to disclosure by Holdings or the Borrower. Any
Person required to maintain the confidentiality of Information as provided in
this Section shall be considered to have complied with its obligation to do so
if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information.
SECTION 9.13. INTEREST RATE LIMITATION. Notwithstanding
anything herein to the contrary, if at any time the interest rate applicable to
any Loan, together with all fees, charges and other amounts which are treated
as interest on such Loan under applicable law (collectively the "CHARGES"),
shall exceed the maximum lawful rate (the "MAXIMUM RATE") which may be
contracted for, charged, taken, received or reserved by the Lender holding such
Loan in accordance with applicable law, the rate of interest payable in respect
of such Loan hereunder, together with all Charges payable in respect thereof,
shall be limited to the Maximum Rate and, to the extent lawful, the interest
and Charges that would have been payable in respect of such Loan but were not
payable as a result of the operation of this Section shall be cumulated and the
interest and Charges payable to such Lender in respect of other Loans or
periods shall be increased (but not above the Maximum Rate therefor) until such
cumulated amount, together with interest thereon at the Federal Funds Effective
Rate to the date of repayment, shall have been received by such Lender.
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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.
AMERICAN MEDIA, INC.,
By: /s/ Peter A. Nelson
-----------------------------------
Name: Peter A. Nelson
Title: Executive Vice President and
Chief Financial Officer
AMERICAN MEDIA OPERATIONS, INC.,
By: /s/ Peter A. Nelson
-----------------------------------
Name: Peter A. Nelson
Title: Executive Vice President and
Chief Financial Officer
THE CHASE MANHATTAN BANK,
individually and as
Administrative Agent,
By: /s/ Marian Schulman
-----------------------------------
Name: Marian Schulman
Title: Vice President
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CAISSE DE DEPOT ET PLACEMENT
DU QUEBEC,
By: /s/ Normand Provost
-----------------------------------
Name: Normand Provost
Title: Coordinating Vice President
By: /s/ Ginette Depelteau
-----------------------------------
Name: Ginette Depelteau
Title: Director and Corporate
Secretary
THE BANK OF NEW YORK,
By: /s/ Edward F. Ryan, Jr.
-----------------------------------
Name: Edward F. Ryan, Jr.
Title: Senior Vice President
SUMMIT BANK,
By: /s/ Henry G. Kush, Jr.
-----------------------------------
Name: Henry G. Kush, Jr.
Title: Vice President
GENERAL ELECTRIC CAPITAL
CORPORATION,
By: /s/ Robert M. Kadlick
-----------------------------------
Name: Robert M. Kadlick
Title: Duly Authorized Signatory
HELLER FINANCIAL, INC.,
By: /s/ Robert M. Reeg
-----------------------------------
Name: Robert M. Reeg
Title: Assistant Vice President
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CREDIT AGRICOLE INDOSUEZ,
By: /s/ Craig Welch
-----------------------------------
Name: Craig Welch
Title: First Vice President
By: /s/ Sarah McClintock
-----------------------------------
Name: Sarah McClintock
Title: Vice President
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK AS TRUSTEE FOR A
COMINGLED TRUST (MGT HIGH
YIELD FUND),
By: /s/ David T. Ellis
-----------------------------------
Name: David T. Ellis
Title: Vice President
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK AS TRUSTEE FOR A
COMINGLED TRUST (SPECIAL
SITUATION FUND),
By: /s/ David T. Ellis
-----------------------------------
Name: David T. Ellis
Title: Vice President
DLJ CAPITAL FUNDING, INC.,
By: /s/ Stephen P. Hickey
-----------------------------------
Name: Stephen P. Hickey
Title: Managing Director
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CYPRESSTREE SENIOR FLOATING
RATE FUND
BY: CYPRESSTREE INVESTMENT
MANAGEMENT COMPANY, INC. AS
PORTFOLIO MANAGER,
By: /s/ Peter K. Merrill
-----------------------------------
Name: Peter K. Merrill
Title: Managing Director
NORTH AMERICAN SENIOR FLOATING
RATE FUND,
BY: CYPRESSTREE INVESTMENT
MANAGEMENT COMPANY, INC. AS
PORTFOLIO MANAGER,
By: /s/ Peter K. Merrill
-----------------------------------
Name: Peter K. Merrill
Title: Managing Director
CYPRESSTREE INVESTMENT FUND,
LLC,
BY: CYPRESSTREE INVESTMENT
MANAGEMENT COMPANY, INC.,
ITS MANAGING MEMBER,
By: /s/ Peter K. Merrill
-----------------------------------
Name: Peter K. Merrill
Title: Managing Director
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CYPRESSTREE INVESTMENT
MANAGEMENT COMPANY, INC.
AS: ATTORNEY-IN-FACT AND ON
BEHALF OF FIRST ALLMERICA
FINANCIAL LIFE INSURANCE
COMPANY AS PORTFOLIO
MANAGER,
By: /s/ Peter K. Merrill
-----------------------------------
Name: Peter K. Merrill
Title: Managing Director
KZH SHENKMAN LLC,
By: /s/ Virginia Conway
-----------------------------------
Name: Virginia Conway
Title: Authorized Agent
KZH IV LLC,
By: /s/ Virginia Conway
-----------------------------------
Name: Virginia Conway
Title: Authorized Agent
KZH SHOSHONE LLC,
By: /s/ Virginia Conway
-----------------------------------
Name: Virginia Conway
Title: Authorized Agent
KZH APALOOSA LLC,
By: /s/ Virginia Conway
-----------------------------------
Name: Virginia Conway
Title: Authorized Agent
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121
KZH SOLEIL-2 LLC,
By: /s/ Virginia Conway
-----------------------------------
Name: Virginia Conway
Title: Authorized Agent
KZH WATERSIDE LLC,
By: /s/ Virginia Conway
-----------------------------------
Name: Virginia Conway
Title: Authorized Agent
KZH STERLING LLC,
By: /s/ Virginia Conway
-----------------------------------
Name: Virginia Conway
Title: Authorized Agent
KZH RIVERSIDE LLC,
By: /s/ Virginia Conway
-----------------------------------
Name: Virginia Conway
Title: Authorized Agent
KZH CYPRESSTREE-1 LLC,
By: /s/ Virginia Conway
-----------------------------------
Name: Virginia Conway
Title: Authorized Agent
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122
TRAVELERS CORPORATE LOAN FUND, INC.,
BY: TRAVELERS ASSET
MANAGEMENT INTERNATIONAL
CORPORATION
By: /s/ John W. Petchler
-----------------------------------
Name: John W. Petchler
Title: Second Vice President
THE TRAVELERS INSURANCE COMPANY,
By: /s/ John W. Petchler
-----------------------------------
Name: John W. Petchler
Title: Second Vice President
SEQUILS I, LTD.
BY: TCW ADVISORS, INC. AS ITS
COLLATERAL MANAGER,
By: /s/ Justin L. Driscoll
-----------------------------------
Name: Justin L. Driscoll
Title: Senior Vice President
By: /s/ Jonathan R. Insull
-----------------------------------
Name: Jonathan R. Insull
Title: Vice President
FRANKLIN FLOATING RATE TRUST,
By: /s/ Chauncey Lufkin
-----------------------------------
Name: Chauncey Lufkin
Title: Vice President
128
123
MORGAN STANLEY DEAN WITTER
PRIME INCOME TRUST,
By: /s/ Sheila A. Finnerty
-----------------------------------
Name: Sheila A. Finnerty
Title: Vice President
NATIONSBANK, N.A.,
By: /s/ Sean P. Bonner
-----------------------------------
Name: Sean P. Bonner
Title: Vice President
SRF TRADING, INC.,
By: /s/ Kelly C. Walker
-----------------------------------
Name: Kelly C. Walker
Title: Vice President
STEIN ROE FLOATING RATE
LIMITED LIABILITY COMPANY,
By: /s/ Brian W. Good
-----------------------------------
Name: Brian W. Good
Title: Vice President
JACKSON NATIONAL LIFE
INSURANCE COMPANY
BY: PPM AMERICA, INC., AS
ATTORNEY IN FACT, ON BEHALF OF
JACKSON NATIONAL LIFE
INSURANCE COMPANY
By: /s/ Michael King
-----------------------------------
Name: Michael King
Title: Vice President
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124
MONUMENTAL LIFE INSURANCE
COMPANY,
By: /s/ Mary T. Pech
-----------------------------------
Name: Mary T. Pech
Title: Vice President
FLOATING RATE PORTFOLIO
BY: INVESCO SENIOR SECURED
MANAGEMENT, INC. AS
ATTORNEY IN FACT,
By: /s/ Joseph Rotondo
-----------------------------------
Name: Joseph Rotondo
Title: Authorized Signatory