EXHIBIT 10.1
EXECUTION COPY
$257,500,000 CREDIT AGREEMENT
DATED AS OF MARCH, 31ST 2004
AMONG
THE HILLMAN COMPANIES, INC.
HILLMAN INVESTMENT COMPANY
THE HILLMAN GROUP, INC.
THE LENDERS FROM TIME TO TIME PARTY HERETO,
MERRILL LYNCH CAPITAL,
AS ADMINISTRATIVE AGENT, ISSUING LENDER AND SWINGLINE LENDER,
JPMORGAN CHASE BANK,
AS SYNDICATION AGENT,
AND
MERRILL LYNCH & CO.,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
AND J.P. MORGAN SECURITIES
AS JOINT LEAD ARRANGERS AND JOINT LEAD BOOKRUNNERS
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TABLE OF CONTENTS
PAGE
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ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms............................................................................. 1
Section 1.02 Computation of Time Periods and Other Definitional Provisions............................. 41
Section 1.03 Accounting Terms and Determinations....................................................... 41
Section 1.04 Classes and Types of Borrowings........................................................... 42
ARTICLE II
THE CREDIT FACILITIES
Section 2.01 Commitments to Lend....................................................................... 42
Section 2.02 Notice of Borrowings...................................................................... 44
Section 2.03 Notice to Lenders; Funding of Loans....................................................... 45
Section 2.04 Evidence of Loans......................................................................... 46
Section 2.05 Letters of Credit......................................................................... 47
Section 2.06 Interest.................................................................................. 56
Section 2.07 Extension and Conversion.................................................................. 57
Section 2.08 Maturity of Loans......................................................................... 58
Section 2.09 Prepayments............................................................................... 58
Section 2.10 Adjustment of Commitments................................................................. 62
Section 2.11 Fees...................................................................................... 64
Section 2.12 Pro-Rata Treatment........................................................................ 65
Section 2.13 Sharing of Payments....................................................................... 66
Section 2.14 Payments; Computations.................................................................... 66
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
Section 3.01 Taxes..................................................................................... 67
Section 3.02 Change in Law, Etc........................................................................ 69
Section 3.03 Basis for Determining Interest Rate Inadequate or Unfair.................................. 69
Section 3.04 Increased Costs and Reduced Return........................................................ 70
Section 3.05 Funding Losses............................................................................ 71
Section 3.06 Base Rate Loans Substituted for Affected Eurodollar Loans................................. 72
ARTICLE IV
CONDITIONS
Section 4.01 Conditions to Closing..................................................................... 72
Section 4.02 Conditions to All Credit Extensions....................................................... 79
ARTICLE V
REPRESENTATIONS AND WARRANTIES
Section 5.01 Organization and Good Standing............................................................ 80
Section 5.02 Power; Authorization; Enforceable Obligations............................................. 80
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Section 5.03 No Conflicts.............................................................................. 81
Section 5.04 No Default................................................................................ 81
Section 5.05 Financial Condition....................................................................... 81
Section 5.06 No Material Change........................................................................ 83
Section 5.07 Title to Properties; Possession Under Leases.............................................. 83
Section 5.08 Litigation................................................................................ 83
Section 5.09 Taxes..................................................................................... 83
Section 5.10 Compliance with Law....................................................................... 83
Section 5.11 Employee Benefit Arrangements............................................................. 84
Section 5.12 Subsidiaries.............................................................................. 85
Section 5.13 Governmental Regulations, Etc............................................................. 85
Section 5.14 Purpose of Loans and Letters of Credit.................................................... 86
Section 5.15 Labor Matters............................................................................. 86
Section 5.16 Environmental Matters..................................................................... 86
Section 5.17 Intellectual Property..................................................................... 87
Section 5.18 Solvency.................................................................................. 87
Section 5.19 Disclosure................................................................................ 88
Section 5.20 Collateral Documents...................................................................... 88
Section 5.21 Ownership................................................................................. 89
Section 5.22 Certain Transactions...................................................................... 89
ARTICLE VI
AFFIRMATIVE COVENANTS
Section 6.01 Information............................................................................... 90
Section 6.02 Preservation of Existence and Franchises.................................................. 92
Section 6.03 Books and Records; Lender Meeting......................................................... 93
Section 6.04 Compliance with Law; Employee Benefit Arrangements........................................ 93
Section 6.05 Payment of Taxes.......................................................................... 93
Section 6.06 Insurance; Certain Proceeds............................................................... 94
Section 6.07 Maintenance of Property................................................................... 94
Section 6.08 Use of Proceeds........................................................................... 95
Section 6.09 Audits/Inspections........................................................................ 95
Section 6.10 Additional Credit Parties; Additional Security............................................ 95
Section 6.11 Interest Rate Protection Agreements....................................................... 98
Section 6.12 Contributions............................................................................. 98
ARTICLE VII
NEGATIVE COVENANTS
Section 7.01 Limitation on Debt........................................................................ 98
Section 7.02 Restriction on Liens...................................................................... 101
Section 7.03 Nature of Business........................................................................ 103
Section 7.04 Consolidation, Merger and Dissolution..................................................... 103
Section 7.05 Asset Dispositions........................................................................ 105
Section 7.06 Investments............................................................................... 107
Section 7.07 Restricted Payments, etc.................................................................. 109
Section 7.08 Prepayments of Debt, etc.................................................................. 111
Section 7.09 Transactions with Affiliates.............................................................. 112
Section 7.10 Fiscal Year; Organizational and Other Documents........................................... 113
Section 7.11 Restrictions with Respect to Intercorporate Transfers..................................... 113
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Section 7.12 Ownership of Subsidiaries; Limitations on Holdings and the Borrower....................... 114
Section 7.13 Sale and Leaseback Transactions........................................................... 115
Section 7.14 Capital Expenditures...................................................................... 115
Section 7.15 Additional Negative Pledges............................................................... 116
Section 7.16 Impairment of Security Interests.......................................................... 116
Section 7.17 Financial Covenants....................................................................... 117
Section 7.18 No Other "Designated Senior Debt"......................................................... 117
Section 7.19 Independence of Covenants................................................................. 118
ARTICLE VIII
DEFAULTS
Section 8.01 Events of Default......................................................................... 118
Section 8.02 Acceleration; Remedies.................................................................... 120
Section 8.03 Allocation of Payments After Event of Default............................................. 121
ARTICLE IX
AGENCY PROVISIONS
Section 9.01 Appointment; Authorization................................................................ 123
Section 9.02 Delegation of Duties...................................................................... 124
Section 9.03 Exculpatory Provisions.................................................................... 125
Section 9.04 Reliance on Communications................................................................ 125
Section 9.05 Notice of Default......................................................................... 125
Section 9.06 Credit Decision; Disclosure of Information by Administrative Agent........................ 126
Section 9.07 No Reliance on Arranger's or Agent's Customer Identification Program...................... 126
Section 9.08 Indemnification........................................................................... 126
Section 9.09 Agents in Their Individual Capacity....................................................... 127
Section 9.10 Successor Agents.......................................................................... 127
Section 9.11 Certain Other Agents...................................................................... 128
Section 9.12 Agents' Fees; Arranger Fee................................................................ 128
ARTICLE X
MISCELLANEOUS
Section 10.01 Notices and Other Communications.......................................................... 128
Section 10.02 No Waiver; Cumulative Remedies............................................................ 129
Section 10.03 Amendments, Waivers and Consents.......................................................... 129
Section 10.04 Expenses.................................................................................. 131
Section 10.05 Indemnification........................................................................... 131
Section 10.06 Successors and Assigns.................................................................... 132
Section 10.07 Confidentiality and Disclosure............................................................ 136
Section 10.08 Set-off................................................................................... 137
Section 10.09 Interest Rate Limitation.................................................................. 137
Section 10.10 Counterparts.............................................................................. 137
Section 10.11 Integration............................................................................... 137
Section 10.12 Survival of Representations and Warranties................................................ 138
Section 10.13 Severability.............................................................................. 138
Section 10.14 Headings.................................................................................. 138
Section 10.15 Defaulting Lenders........................................................................ 138
Section 10.16 Governing Law; Submission to Jurisdiction................................................. 138
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Section 10.17 Waiver of Jury Trial...................................................................... 139
Section 10.18 Binding Effect............................................................................ 139
Section 10.19 Lenders' U.S. Patriot Act Compliance Certification........................................ 139
Section 10.20 U.S. Patriot Act Notice................................................................... 140
SCHEDULES:
Schedule 1.01A - Lenders and Commitments
Schedule 1.01B - Consolidated EBITDA; Non-Cash Accounting
Adjustments in Respect of the Acquisition
Schedule 1.01C - Refinanced Agreements
Schedule 1.01D - Management Group
Schedule 1.01E - Lender Addresses
Schedule 1.01F - Insignificant Subsidiaries
Schedule 1.01G - Historical Financial Covenant Information
Schedule 2.05 - Existing Letters of Credit
Schedule 4.01(k)(i) - Mortgaged Properties
Schedule 5.02 - Required Consents, Authorizations, Notices
and Filings
Schedule 5.04 - Defaults, Etc.
Schedule 5.05 - Certain Liabilities
Schedule 5.08 - Litigation
Schedule 5.09 - Taxes
Schedule 5.10 - Compliance with Law
Schedule 5.11 - ERISA
Schedule 5.12 - Subsidiaries
Schedule 5.16 - Environmental Matters
Schedule 5.17 - Intellectual Property
Schedule 5.20(c) - Mortgage Recordings
Schedule 5.21 - Ownership of Holdings
Schedule 5.22 - Broker's Fees
Schedule 6.10(b) - Exceptions to Additional Security
Schedule 7.02 - Existing Liens
Schedule 7.05 - Scheduled Asset Dispositions
Schedule 7.06 - Existing Investments
Schedule 7.09 - Transactions with Affiliates
EXHIBITS:
Exhibit A-1 - Form of Notice of Borrowing
Exhibit A-2 - Form of Notice of Extension/Conversion
Exhibit A-3 - Form of Letter of Credit Request
Exhibit A-4 - Form of Swingline Loan Request
Exhibit B-1 - Form of Revolving Note
Exhibit B-2 - Form of Term B Note
Exhibit B-3 - Form of Swingline Note
Exhibit C - Form of Assignment and Acceptance
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Exhibit D-1 - Form of Opinion of Counsel for the Borrower
and the Other Credit Parties
Exhibit D-2 - Form of Opinion of Special Local Counsel
for the Borrower and the Other Credit
Parties
Exhibit D-3 - Form of Opinion of Special Local Counsel
for the Borrower and the Other Credit
Parties (Real Property Collateral)
Exhibit E - Form of Guaranty
Exhibit F-1 - Form of Security Agreement
Exhibit F-2 Form of Pledge Agreement
Exhibit F-3 - Form of Perfection Certificate
Exhibit F-4 - Form of Mortgage
Exhibit G - Form of Intercompany Note
Exhibit H - Form of Intercompany Note Subordination
Provisions
Exhibit I - Form of Credit Party Accession Agreement
Exhibit J - Form of OFAC/Anti-Terrorism Compliance
Certificate
Exhibit K - Form of Solvency Certificate
Exhibit L - Form of Secretary's Certificate
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CREDIT AGREEMENT
This Credit Agreement is dated as of ________, __, 2004 and is among
THE HILLMAN COMPANIES, INC. ("Holdings"), HILLMAN INVESTMENT COMPANY
("Intermediate Holdings"), THE HILLMAN GROUP, INC., (the "Borrower"), the banks
and other financial institutions from time to time party hereto (the "Lenders"),
MERRILL LYNCH CAPITAL, a division of Merrill Lynch Business Financial Services,
Inc., as Administrative Agent, Issuing Lender and Swingline Lender, JPMORGAN
CHASE BANK, as Syndication Agent, and MERRILL LYNCH & CO., MERRILL LYNCH,
PIERCE, FENNER & SMITH INCORPORATED and J.P. MORGAN SECURITIES together as the
Joint Lead Arrangers and Joint Bookrunners.
Holdings and the Borrower have requested the Lenders to provide
credit facilities to the Borrower in the aggregate principal amount of up to
$257,500,000 for the purposes described herein. The Lenders are willing to make
the requested credit facilities available on the terms and conditions set forth
herein. Accordingly, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 DEFINED TERMS. The following terms, as used herein,
have the following meanings:
"Accession Agreement" means a Credit Party Accession Agreement,
substantially in the form of Exhibit I hereto, executed and delivered by an
Additional Subsidiary Guarantor after the Closing Date in accordance with
Section 6.10(a).
"Acquisition" means the acquisition contemplated by the Acquisition
Agreement.
"Acquisition Agreement" means the Agreement and Plan of Merger dated
as of February 14, 2004 among AcquisitionCo, the Sellers and Target, as the same
may be amended, modified or supplemented from time to time in accordance with
the provisions thereof and of this Agreement.
"AcquisitionCo" means HCI Acquisition Corp., a Delaware incorporated
company.
"Acquisition Documents" means the Acquisition Agreement, including
all exhibits and schedules thereto, and all other agreements, documents and
instruments relating to the Acquisition, in each case as the same may be
amended, modified or supplemented from time to time in accordance with the
provisions thereof and of this Agreement.
"Additional Collateral Documents" has the meaning set forth in
Section 6.10(b).
"Additional Letter of Credit" means any letter of credit issued
hereunder by an Issuing Lender on or after the Closing Date.
"Additional Subsidiary Guarantor" means each Person that becomes a
Subsidiary Guarantor after the Closing Date by execution of an Accession
Agreement as provided in Section 6.10.
"Adjusted London Interbank Offered Rate" means, for the Interest
Period for each Eurodollar Loan comprising part of the same Group, the quotient
obtained (rounded upward, if necessary, to the next higher 1/100th of 1%) by
dividing (i) the applicable London Interbank Offered Rate for such Interest
Period by (ii) 1.00 minus the Eurodollar Reserve Percentage.
"Administrative Agent" means Merrill Lynch Capital, in its capacity
as administrative agent for the Lenders hereunder and under the other Senior
Finance Documents, and its successor or successors in such capacity.
"Administrative Agent's Office" means the Administrative Agent's
office located at Merrill Lynch Capital, 222 N. LaSalle Street, 16th Floor,
Chicago IL 60601, or such other office as may be designated by the
Administrative Agent by written notice to the Borrower and the Lenders.
"Affiliate" means, with respect to any Person, (i) any Person that
directly, or indirectly through one or more intermediaries, controls such Person
(a "Controlling Person") or (ii) any other Person which is controlled by or is
under common control with a Controlling Person. As used herein, the term
"control" means (i) with respect to any Person having voting shares or their
equivalent and elected directors, managers or Persons performing similar
functions, the possession, directly or indirectly, of the power to vote 10% or
more of the Equity Interests having ordinary voting power of such Person or (ii)
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting shares or their equivalent, by contract or otherwise.
"Agent" means the Administrative Agent, the Syndication Agent, or
the Collateral Agent and any successors and assigns in such capacity, and
"Agents" means any two or more of them.
"Agreement" means this Credit Agreement, as amended, restated,
modified or supplemented from time to time.
"Anti-Terrorism Laws" means any Laws relating to terrorism or
money-laundering, including, without limitation, (i) Executive Order No. 13224
on Terrorist Financing, effective September 24, 2001 and relating to Blocking
Property and Prohibiting Transactions with Persons Who Commit, Threaten to
Commit, or Support Terrorism, (ii) the U.S. Patriot Act, (iii) the International
Emergency Economic Power Act, 50 U.S.C. Section 1701 et seq., (iv) the Bank
Secrecy Act, (v) the Trading with the Enemy Act, 50 U.S.C. App. 1 et seq. and
(vi) any related rules and regulations of the U.S. Treasury Department's Office
of Foreign Assets Control or any other Governmental Authority, in each case as
the same may be amended, supplemented, modified, replaced or otherwise in effect
from time to time.
"Applicable Lending Office" means (i) with respect to any Lender and
for each Type of Loan, the "Lending Office" of such Lender (or of an Affiliate
of such Lender) designated for such Type of Loan on Schedule 1.01E hereto or in
any applicable Assignment and Acceptance pursuant to which such Lender became a
Lender hereunder or such other office of such Lender (or of an Affiliate of such
Lender) as such Lender may from time to time (so long as no additional cost to
the Borrower results) specify to the Administrative Agent and the Borrower as
the office by which its Loans of such Type are to be made and maintained and
(ii) with respect to any Issuing Lender and for each Letter of Credit, the
"Lending Office" of such Issuing Lender (or of an Affiliate of such Issuing
Lender) designated on the signature pages hereto or such other office of such
Issuing Lender (or of an Affiliate of such Issuing Lender) as such Issuing
Lender may from time to time specify (so long as no additional cost to the
Borrower results) to the Administrative Agent and the Borrower as the office by
which its Letters of Credit are to be issued and maintained.
"Applicable Margin" means, (i) for purposes of calculating the
applicable interest rate for any day for any Term B Loan, (x) 3.25% in the case
of Eurodollar Loans and 2.25% in the case of Base Rate Loans if the Leverage
Ratio as of the applicable Calculation Date equals or exceeds 3.00 to 1.0 and
(the pricing described in the foregoing clause (i)(x) constituting Pricing Level
I with respect to Term B Loans for purposes of the next succeeding paragraph of
this definition), (y) otherwise, 3.00% in the case
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of Eurodollar Loans and 2.00% in the case of Base Rate Loans (the pricing
described in the foregoing clause (i)(y) constituting Pricing Level II with
respect to Term B Loans for purposes of the next succeeding paragraph), and (ii)
for purposes of calculating the applicable interest rate for any day for any
Revolving Loan, or any Swingline Loan or the applicable rate of the Letter of
Credit Fee for any day for purposes of Section 2.11(b)(i), the appropriate
applicable margin set forth below corresponding to the Leverage Ratio as of the
most recent Calculation Date:
REVOLVING LOANS AND SWINGLINE LOANS LETTER OF CREDIT FEES
- -----------------------------------------------------------------------------------------------------------
Applicable Margin
Applicable Margin For Base Applicable Margin For
Leverage For Rate Letter of
Pricing Level Ratio Eurodollar Loans Loans Credit Fee
- -----------------------------------------------------------------------------------------------------------
I > or = 3.5 to 1.0 3.00% 2.00% 3.00%
- -----------------------------------------------------------------------------------------------------------
II <3.5 to 1.0 but 2.75% 1.75% 2.75%
> or = 2.5 to 1.0
- -----------------------------------------------------------------------------------------------------------
III <2.5 to 1.0 but 2.50% 1.50% 2.50%
> or = 1.5 to 1.0
- -----------------------------------------------------------------------------------------------------------
IV <1.5 to 1.0 2.25% 1.25% 2.25%
- -----------------------------------------------------------------------------------------------------------
Each Applicable Margin shall be determined and adjusted quarterly on the date
(each a "Calculation Date") five Business Days after the date by which the
Borrower is required to provide the consolidated financial information required
by Section 6.01(a) or (b) and the officer's certificate required by Section
6.01(c) for the fiscal quarter or year of the Borrower most recently ended prior
to the Calculation Date; provided, however, that: (i) the initial Applicable
Margin for Eurodollar Loans shall be 3.25%, in the case of Term B Loans, and
3.00%, in the case of Revolving Loans and Letter of Credit Fees; (ii) the
initial Applicable Margin for Base Rate Loans shall be 2.25%, in the case of
Term B Loans, and 2.00%, in the case of Revolving Loans and Letter of Credit
Fees; (iii) the initial Applicable Margins determined in accordance with the
immediately preceding clauses (i) and (ii) shall remain in effect until the
first Calculation Date occurring after the end of the first full fiscal quarter
of the Borrower ending at least three months after the Closing Date and,
thereafter, each Applicable Margin for Term B Loans, Revolving Loans and Letter
of Credit Fees shall be based on the Pricing Level (as shown above)
corresponding to the Leverage Ratio as of the last day of the most recently
ended fiscal quarter or year of the Borrower preceding the applicable
Calculation Date; and (iv) if the Borrower fails to provide the consolidated
financial information required by Section 6.01(a) or (b) or the officer's
certificate required by Section 6.01(c) for the most recently ended fiscal
quarter or year of the Borrower preceding any applicable Calculation Date, (A)
each Applicable Margin for Term B Loans, Revolving Loans and Letter of Credit
Fees from such Calculation Date shall be based on the Pricing Level (as shown or
described above) one level above that theretofore in effect (with Pricing Level
I being one level higher than Pricing Level II and so on) and in each case until
such time as such consolidated financial information and the officer's
certificate is provided, whereupon each Applicable Margin shall be based on the
Pricing Level (as shown or described above) corresponding to the Leverage Ratio
as of the last day of the most recently ended fiscal quarter or year of the
Borrower preceding such Calculation Date. Each Applicable Margin shall be
effective from one Calculation Date until the next Calculation Date. Any
adjustment in the Applicable Margins shall be applicable to all Loans and
Letters of Credit then existing or subsequently made or issued.
"Approved Fund" means (i) with respect to any Lender, an entity
(whether a corporation, partnership, limited liability company, trust or
otherwise) that is engaged in making, purchasing, holding or otherwise investing
in bank loans and similar extensions of credit in the ordinary course of its
business
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and is managed by such Lender, its parent holding company or any of their
respective subsidiaries, (ii) with respect to any Lender that is a fund that
invests in bank loans and similar extensions of credit, any other fund that
invests in bank loans and similar extensions of credit and is managed by the
same investment advisor as such Lender or by any parent company of such Lender
or any of their respective Subsidiaries and (iii) any special purpose funding
vehicle described in Section 10.06(h).
"Asset Disposition" means any sale (including any Sale/Leaseback
Transaction, whether or not involving a Capital Lease), lease (as lessor),
transfer or other disposition (including any such transaction effected by way of
merger or consolidation and including any sale or other disposition of Equity
Interests of a Subsidiary, but excluding any sale or other disposition by way of
Casualty or Condemnation) by any Group Company of any asset.
"Assignment and Acceptance" means an Assignment and Acceptance,
substantially in the form of Exhibit C hereto, under which an interest of a
Lender hereunder is transferred to an Eligible Assignee pursuant to Section
10.06(b).
"Attributable Debt" means, at any date (i) in respect of any Capital
Lease of any Person, the capitalized amount thereof that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP,
(ii) in respect of any Synthetic Lease Obligation of any Person, the capitalized
or principal amount of the remaining lease payments under the relevant lease
that would appear on a balance sheet of such Person prepared as of such date in
accordance with GAAP if such lease or other agreement were accounted for as a
Capital Lease and (iii) in respect of any Sale/Leaseback Transaction described
in Section 7.13, the lesser of (A) the present value, discounted in accordance
with GAAP at the interest rate implicit in the related lease, of the obligations
of the lessee for net rental payments over the remaining term of such lease
(including any period for which such lease has been extended or may, at the
option of the lessor be extended) and (B) the fair market value of the assets
subject to such transaction.
"Availability Period" means the period from the Closing Date to the
Revolving Termination Date.
"Bank Secrecy Act" means the Financial Recordkeeping and Reporting
of Currency and Foreign Transactions Act of 1970, 31 U.S.C. 1051, et seq., as
the same may be amended, supplemented, modified, replaced or otherwise in effect
from time to time.
"Base Rate" means, for any day, a rate per annum equal to the higher
of (i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the
Federal Funds Rate for such day. Any change in the Base Rate due to a change in
the Prime Rate or the Federal Funds Rate shall be effective on the effective
date of such change in the Prime Rate or the Federal Funds Rate.
"Base Rate Loan" means at any date a Loan bearing interest at a rate
determined by reference to the Base Rate.
"Borrower" means The Hillman Group, Inc.
"Borrowing" has the meaning set forth in Section 1.04.
"Business Acquisition" means the acquisition by the Borrower or one
or more of its Wholly-Owned Subsidiaries of all of the Equity Interests of, or
all (or any division, line of business or substantial part for which financial
statements or other financial information reasonably satisfactory to the
Administrative Agent is available) of the assets or property of, another Person.
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"Business Day" means any day except a Saturday, Sunday or other day
on which commercial banks in The City of New York are authorized or required to
close, except that (i) when used in Section 2.05 with respect to any action
taken by or with respect to any Issuing Lender, the term "Business Day" shall
not include any day on which commercial banks are authorized by law to close in
the jurisdiction where such Issuing Lender's Applicable Lending Office is
located; and (ii) if such day relates to a borrowing of, a payment or prepayment
of principal of or interest on, or the Interest Period for, a Eurodollar Loan,
or a notice by the Borrower with respect to any such borrowing, payment,
prepayment or Interest Period, such day shall also be a day on which commercial
banks are open for international business (including dealings in Dollar
deposits) in London.
"Capital Lease" of any Person means any lease of (or other
arrangement conveying the right to use) property (whether real, personal or
mixed) by such Person as lessee which would, in accordance with GAAP, be
required to be accounted for as a capital lease on the balance sheet of such
Person.
"Capital Lease Obligations" means, with respect to any Person, all
obligations of such Person as lessee under Capital Leases, in each case taken at
the amount thereof accounted for as liabilities in accordance with GAAP.
"Capitalization Documents" has the meaning set forth in Section
4.01(f).
"Cash Collateralize" means to pledge and deposit with or deliver to
the Collateral Agent, for the benefit of the Issuing Lenders and the Revolving
Lenders, as collateral for the LC Obligations, cash or deposit balances pursuant
to documentation in form and substance reasonably satisfactory to the
Administrative Agent and the Issuing Lenders.
"Cash Equivalents" means, at any date of determination:
(i) securities issued or directly and fully guaranteed or
insured by the United States or any agency or instrumentality thereof
(provided that the full faith and credit of the United States is pledged
in support thereof) or, with respect to any Foreign Subsidiary, an
equivalent obligation of the government of the country in which such
Foreign Subsidiary transacts business, in each case maturing within one
year after such date;
(ii) time deposits and certificates of deposit, including
eurodollar time deposits and, with respect to any Foreign Subsidiary, time
deposits in the currency of any country in which such Foreign Subsidiary
transacts business, of any commercial bank organized in the United States
having capital and surplus in excess of $100,000,000 or, with respect to
any Foreign Subsidiary, a commercial bank organized under the laws of any
other country in which such Foreign Subsidiary transacts business having
total assets in excess of $100,000,000 (or its foreign currency
equivalent)with a maturity date not more than one year from the date of
acquisition;
(iii) repurchase obligations with a term of not more than
seven days for underlying securities of the types described in clauses (i)
above entered into with any bank meeting the qualifications specified in
clause (ii) above and organized in the United States;
(iv) direct obligations issued by any state of the United
States or any political subdivision of any state or any public
instrumentality thereof maturing within 90 days after the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from either S&P or Moody's (or, if at any time
neither S&P nor Moody's shall be
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rating such obligations, then from such other nationally recognized rating
service reasonably acceptable to the Administrative Agent);
(v) commercial paper issued by the parent corporation of any
commercial bank organized in the United States having capital and surplus
in excess of $100,000,000, or, with respect to any Foreign Subsidiary, a
commercial bank organized under the laws of any other country in which
such Foreign Subsidiary transacts business having total assets in excess
of $100,000,000 (or its foreign currency equivalent), and commercial paper
issued by others having one of the two highest ratings obtainable from
either S&P or Moody's (or, if at any time neither S&P nor Moody's shall be
rating such obligations, then from such other nationally recognized rating
services reasonably acceptable to the Administrative Agent) and in each
case maturing within one year after the date of acquisition;
(vi) overnight bank deposits and bankers' acceptances at any
commercial bank organized in the United States having capital and surplus
in excess of $100,000,000 or with respect to any Foreign Subsidiary, a
commercial bank organized under the laws of any other country in which
such Foreign Subsidiary transacts business having total assets in excess
of $100,000,000 (or its foreign currency equivalent);
(vii) deposits available for withdrawal on demand with
commercial banks organized in the United States having capital and surplus
in excess of $50,000,000 or, with respect to any Foreign Subsidiary, a
commercial bank organized under the laws of any other country in which
such Foreign Subsidiary transacts business having total assets in excess
of $50,000,000 (or its foreign currency equivalent); and
(viii) investments in money market funds substantially all of
whose assets comprise securities of the types described in clauses (i)
through (vii).
"Casualty" means any casualty, loss, damage, destruction or other
similar loss with respect to real or personal property or improvements.
"Casualty Insurance Policy" means any insurance policy maintained by
any Group Company covering losses with respect to Casualties.
"Change in Law" means the occurrence, after the date of this
Agreement, of any of the following: (i) the adoption or taking effect of any
applicable law, rule, regulation or treaty, (ii) any change in any applicable
law, rule, regulation or treaty or in the administration, interpretation or
application thereof by any Governmental Authority or (iii) the making or
issuance of any request, guideline or directive (whether or not having the force
of law) by any Governmental Authority.
"Change of Control" means the occurrence of any of the following
events:
(i) (A) Holdings shall cease to own directly or indirectly
100% of the Common Stock Equity Interests of Intermediate Holdings, on a
fully-diluted basis assuming the conversion and exercise of all
outstanding Equity Equivalents (whether or not such securities are then
currently convertible or exercisable), (B) the Investor Group shall cease
to own directly or indirectly 51% of the outstanding Preferred Stock of
Intermediate Holdings, (C) Intermediate Holdings shall cease to own
directly or indirectly 100% of the Equity Interests of the Borrower, on a
fully-diluted basis assuming the conversion and exercise of all
outstanding Equity Equivalents (whether or not such securities are then
currently convertible or exercisable), (D) the Investor Group shall cease
to own beneficially (as defined in the Exchange Act), directly or
- 6 -
indirectly, at least 51% of the outstanding voting Equity Interests of
Holdings, (E) any "person" or "group" (as each such term is defined in the
Exchange Act), other than the Sponsor Group, is or becomes the "beneficial
owner" (as defined in the Exchange Act, except that a Person will be
deemed to have beneficial ownership of all shares that such Person has the
right to acquire, whether such right is exercisable immediately or only
after the passage of time), directly or indirectly, of a greater
percentage of the voting Equity Interests of Holdings and the Preferred
Stock of Intermediate Holdings, than the percentage of the voting Equity
Interests of Holdings and Preferred Stock of Intermediate Holdings, then
owned beneficially, directly or indirectly, by the Sponsor Group or (F)
the failure at any time of the Investor Group to control, whether through
the ownership of voting securities or by contract, a majority of the seats
on the board of directors (or persons performing similar functions) of
Holdings; or
(ii) during any period of two consecutive calendar years,
individuals who at the beginning of such period constituted the board of
directors (or persons performing similar functions) of Holdings together
with any new members of such board of directors (A) whose elections by
such board of directors or whose nominations for election by the
equityholders of Holdings was approved by a vote of a majority of the
members of such board of directors then still in office who either were
directors at the beginning of such period or whose election or nomination
for election was previously so approved or by any new directors who were
nominated to serve on behalf of the Investor Group or (B) elected or
appointed by the Investor Group, cease for any reason to constitute a
majority of the directors of Holdings still in office; or
(iii) a "change of control" or similar event (as defined in
any debt instrument in excess of $5 million) occurs.
"Class" has the meaning set forth in Section 1.04.
"Closing Date" means the date on or after the Effective Date when
the first Credit Extension occurs in accordance with Section 4.01.
"Code" means the Internal Revenue Code of 1986, as amended, and any
successor statute thereto, as interpreted by the rules and regulations issued
thereunder, in each case as in effect from time to time.
"Collateral" means all of the property which is subject or is
purported to be subject to the Liens granted by the Collateral Documents.
"Collateral Agent" means Merrill Lynch Capital, in its capacity as
collateral agent for the Finance Parties under the Collateral Documents, and its
successor or successors in such capacity.
"Collateral Documents" means, collectively, the Security Agreement,
the Pledge Agreement, the Depositary Bank Agreements, each Mortgage, any
Additional Collateral Documents, any additional pledges, security agreements,
patent, trademark or copyright filings or mortgages required to be delivered
pursuant to the Finance Documents and any instruments of assignment, control
agreements, lockbox letters or other instruments or agreements executed pursuant
to the foregoing.
"Commitment" means (i) with respect to each Lender, its Revolving
Commitment and/or its Term B Commitment, as and to the extent applicable, (ii)
with respect to each Issuing Lender, its LC Commitment and (iii) with respect to
the Swingline Lender, the Swingline Commitment, in each case as set forth on
Schedule 1.01A or in the applicable Assignment and Acceptance as its Commitment
of the
- 7 -
applicable Class, as any such amount may be increased or decreased from time to
time pursuant to this Agreement.
"Commitment Fee" has the meaning set forth in Section 2.11(a).
"Common Stock" means the common stock of either Holdings,
Intermediate Holdings, the Borrower or any of its Subsidiaries.
"Computer Hardware" means all computer and other electronic data
processing hardware of a Credit Party, whether now or hereafter owned, licensed
or leased by such Credit Party, including, without limitation, all integrated
computer systems, central processing units, memory units, display terminals,
printers, features, computer elements, card readers, tape drives, hard and soft
disk drives, cables, electrical supply hardware, generators, power equalizers,
accessories, peripheral devices and other related computer hardware, all
documentation, flowcharts, logic diagrams, manuals, specifications, training
materials, charts and pseudo codes associated with any of the foregoing and all
options, warranties, services contracts, program services, test rights,
maintenance rights, support rights, renewal rights and indemnifications relating
to any of the foregoing.
"Condemnation" means any taking by a Governmental Authority of
property or assets, or any part thereof or interest therein, for public or
quasi-public use under the power of eminent domain, by reason of any public
improvement or condemnation.
"Condemnation Award" means all proceeds of any Condemnation or
transfer in lieu thereof.
"Consolidated Adjusted Working Capital" means at any date the excess
of (i) Consolidated Current Assets (excluding (A) cash and Cash Equivalents
classified as such in accordance with GAAP and (B) deferred taxes calculated in
accordance with GAAP) over (ii) Consolidated Current Liabilities (excluding (A)
the current portion of any Consolidated Funded Debt, (B) the aggregate principal
amount of outstanding Revolving Loans, (C) accrued and unpaid interest on any
Consolidated Funded Debt and/or Revolving Loans and (D) deferred taxes
calculated in accordance with GAAP).
"Consolidated Capital Expenditures" means for any period the
aggregate amount of all expenditures (whether paid in cash or other
consideration or accrued as a liability) that would, in accordance with GAAP, be
included as additions to property, plant and equipment and other capital
expenditures of Holdings and its Consolidated Subsidiaries for such period, as
the same are or would be set forth in a consolidated statement of cash flows of
Holdings and its Consolidated Subsidiaries for such period (including the amount
of assets leased under any Capital Lease), but excluding (to the extent that
they would otherwise be included) (i) any such expenditures made for the
replacement or restoration of assets in amounts not exceeding the aggregate
amount of Insurance Proceeds or Condemnation Award with respect to the asset or
assets being replaced or restored, (ii) for purposes of Section 7.14 only,
capital expenditures for Permitted Business Acquisitions, (iii) any such
expenditures made with proceeds of a Qualifying Equity Issuance, (iv) any such
expenditures to the extent Holdings or any of its Consolidated Subsidiaries has
received reimbursement in cash from a third party other than Holdings or one or
more of its Consolidated Subsidiaries and (v) capitalized interest; provided,
however, that Consolidated Capital Expenditures for any fiscal quarter shown on
Schedule 1.01G hereto shall be deemed to equal the applicable amount set forth
opposite such fiscal quarter on Schedule 1.01G.
"Consolidated Cash Interest Expense" means for any period
Consolidated Interest Expense that has been paid in cash for such period, or any
cash interest that is paid in such period for which the interest expense was
accrued in a prior period in accordance with GAAP, other than (to the
- 8 -
extent, but only to the extent, included in the determination of Consolidated
Interest Expense for such period in accordance with GAAP and paid in cash for
such period), (i) amortization of debt discount and debt issuance fees, (ii) any
fees (including underwriting fees and expenses) paid in connection with the
consummation of the Transaction or Permitted Business Acquisitions, (iii) any
payments made to obtain Derivatives Agreements, (iv) any agent or collateral
monitoring fees paid or required to be paid pursuant to any Finance Document,
(v) the actual or implied interest component of any consulting payments and (vi)
annual agency fees, unused line fees and letter of credit fees and expenses paid
hereunder; provided, however, that Consolidated Cash Interest Expense for any
fiscal quarter shown on Schedule 1.01G hereto shall be deemed to equal the
applicable amount set forth opposite such fiscal quarter on Schedule 1.01G.
"Consolidated Cash Tax Expense" means for any period the aggregate
Federal, state, local and foreign income, franchise, state single business
unitary and similar taxes that have been paid in cash by Holdings and its
Consolidated Subsidiaries for such period; provided, however, that Consolidated
Cash Tax Expense for any fiscal quarter shown on Schedule 1.01G hereto shall be
deemed to equal the applicable amount set forth opposite such fiscal quarter on
Schedule 1.01G.
"Consolidated Current Assets" means at any date the consolidated
current assets of Holdings and its Consolidated Subsidiaries determined as of
such date.
"Consolidated Current Liabilities" means at any date the
consolidated current liabilities of Holdings and its Consolidated Subsidiaries
determined as of such date.
"Consolidated Debt" means at any date the Debt of Holdings and its
Consolidated Subsidiaries, determined on a consolidated basis as of such date.
"Consolidated EBITDA" means for any period the sum of (i)
Consolidated Net Income for such period (excluding therefrom (x) any
extraordinary, or non-cash unusual or non recurring items of gain or loss, (y)
any gain or loss from discontinued operations and (z) any gain or loss
attributable to Asset Dispositions made other than in the ordinary course of
business), plus (ii) to the extent not otherwise included in the determination
of Consolidated Net Income for such period, all proceeds of business
interruption insurance policies, if any, received during such period plus (iii)
(without duplication) an amount which, in the determination of Consolidated Net
Income for such period, has been deducted for (A) Consolidated Interest Expense,
(B) provisions for Federal, state, local and foreign income, franchise, state
single business unitary and similar taxes, (C) depreciation, amortization
(including, without limitation, amortization of goodwill and other intangible
assets), impairment of goodwill and other non-cash charges or expenses
(excluding any such non-cash charge to the extent that it represents
amortization of a prepaid cash expense that was paid in a prior period), (D)
non-cash compensation expense, or other non-cash expenses or charges, arising
from the sale of stock, the granting of stock options, the granting of stock
appreciation rights and similar arrangements (including any repricing,
amendment, modification, substitution or change of any such stock, stock option,
stock appreciation rights or similar arrangements), (E) non-cash rent expense,
(F) any financial advisory fees, accounting fees, legal fees and other similar
advisory and consulting fees and related out-of-pocket expenses of the Borrower
incurred as a result of the Transaction, all determined in accordance with GAAP,
eliminating any increase or decrease in income resulting from non-cash
accounting adjustments made in connection with the Acquisition, (G) Transaction
related expenditures (including cash charges in respect of strategic market
reviews, management bonuses, including payments under the sale bonus program, of
up to $1,510,000.00 in aggregate, early retirement of Debt, restructuring,
consolidation, severance or discontinuance of any portion of operations,
employees and/or management) described on Schedule 1.01B, (H) expenses incurred
by Holdings or any Consolidated Subsidiary to the extent reimbursed in cash by a
third party other than Holdings or one or more of its Consolidated Subsidiaries,
(I) fees and expenses in connection with the exchange of the Subordinated
Debentures, (J) unrealized
- 9 -
losses on Derivatives Agreements, (K) losses from foreign currency adjustments,
(L) losses in respect of pension or other post-retirement benefits or pension
assets, (M) write-offs of deferred financing costs, (N) expenses in respect of
earn-out obligations (O) any financial advisory fees, accounting fees, legal
fees and similar advisory and consulting fees and related out-of-pocket expenses
of the Borrower and its Consolidated Subsidiaries incurred as a result of
Permitted Business Acquisitions, all determined in accordance with GAAP and in
each case eliminating any increase or decrease in income resulting from non-cash
accounting adjustments made in connection with the related Permitted Business
Acquisition and (P) expenses relating to the granting and exercising of
management options on or prior to the Closing Date, minus (iv) any amount which,
in the determination of Consolidated Net Income for such period, has been added
for any non-cash income or non-cash gains, all as determined in accordance with
GAAP minus (v) the aggregate amount of cash payments made during such period in
respect of any non-cash accrual, reserve or other non-cash charge or expense
accounted for in a prior period and not otherwise reducing Consolidated Net
Income for such period, provided, however, that Consolidated EBITDA for any
fiscal quarter shown on Schedule 1.01G hereto shall be deemed to equal the
applicable amount set forth opposite such fiscal quarter on Schedule 1.01G; and
provided, further, that Consolidated EBITDA for the fiscal quarter during which
the Closing Date occurs shall be calculated on a Pro-Forma Basis by reducing
Consolidated Net Income for such quarter by the aggregate amount of management
fees payable to the Sponsor in respect of such quarter or which would have been
payable in respect of such quarter if the Closing Date had occurred on the first
day of such quarter, each such pro-forma reduction to be in the applicable
amount shown therefor for such quarter on Schedule 1.01G.
For purposes of calculating Consolidated EBITDA for any period of
four consecutive fiscal quarters (each, a "Reference Period") pursuant to any
determination of the Leverage Ratio, the Interest Coverage Ratio and the Fixed
Charge Coverage Ratio, 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 and including the date as of which such calculation is made) any Group
Company shall have made an Asset Disposition or a series of Asset Dispositions
involving assets comprising all or substantially all of an operating unit of a
business or constituting all or substantially all of the common stock of a
Subsidiary or made a Permitted Business Acquisition, Consolidated EBITDA for
such Reference Period shall be calculated after giving effect thereto on a
Pro-Forma Basis, giving effect to projected or anticipated cost savings
permitted or required by regulations S-X or S-K under the Securities Act or
otherwise agreed to by the Administrative Agent in its reasonable discretion
after consultation with the Borrower.
"Consolidated Fixed Charges" means, for any period, the sum of (i)
Consolidated Cash Interest Expense for such period plus (ii) Consolidated
Scheduled Debt Payments for such period plus (iii) Consolidated Cash Tax Expense
for such period.
"Consolidated Funded Debt" means at any date the Funded Debt of
Holdings and its Consolidated Subsidiaries as of such date, determined on a
consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" means, for any period, the total
interest expense, whether paid or accrued in such period and whether or not
capitalized in such period, (including, without limitation, amortization of debt
issuance costs and original issue discount, non-cash interest payments, the
interest component of any deferred payment obligations, the interest component
of all payments under Capital Leases (regardless of whether accounted for as
interest expense under GAAP), all commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers' acceptances and net
costs in respect of Derivatives Obligations constituting interest rate swaps,
collars, caps or other arrangements requiring payments contingent upon interest
rates of Holdings and its Consolidated Subsidiaries), net of interest income, in
each case determined on a consolidated basis for such period.
- 10 -
"Consolidated Net Income" means, for any period, the net income (or
net loss) after taxes of Holdings and its Consolidated Subsidiaries for such
period, determined on a consolidated basis in accordance with GAAP; provided
that there shall be excluded from the calculation of Consolidated Net Income for
any period (i) the income (or loss) of any Person in which any other Person
(other than Holdings or any of its Wholly-Owned Consolidated Subsidiaries) has
an ownership interest, except to the extent that any such income is actually
received in cash by Holdings or such Wholly-Owned Consolidated Subsidiary in the
form of Restricted Payments during such period, (ii) the income (or loss) of any
Person accrued prior to the date it becomes a Consolidated Subsidiary of
Holdings or is merged with or into or consolidated with Holdings or any of its
Consolidated Subsidiaries or that Person's assets are acquired by Holdings or
any of its Consolidated Subsidiaries, except as provided in the definitions of
Consolidated EBITDA and "Pro-Forma Basis" herein and (iii) the income of any
Subsidiary of Holdings to the extent that the declaration or payment of
Restricted Payments or similar distributions by that Subsidiary of that income
is not at the time permitted by operation of the terms of its charter or any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Subsidiary.
"Consolidated Scheduled Debt Payments" means, for any period, the
sum of all scheduled payments of principal on the Loans and all other
Consolidated Funded Debt (including, without limitation, the principal component
of Capital Lease Obligations and Purchase Money Debt) paid or payable during
such period), but excluding payments due on Revolving Loans and Swingline Loans
during such period; provided that Consolidated Scheduled Debt Payments for any
period shall not include voluntary prepayments of Consolidated Funded Debt,
mandatory prepayments of the Term B Loans pursuant to Section 2.09(b) or other
mandatory prepayments (other than by virtue of scheduled amortization) of
Consolidated Funded Debt (but Consolidated Scheduled Debt Payments for a period
shall be adjusted to reflect the effect on scheduled payments of principal for
such period of the application of any prepayments of Consolidated Funded Debt
during or preceding such period); provided, however, that Consolidated Scheduled
Debt Payments for any fiscal quarter shown on Schedule 1.01G hereto shall be
deemed to equal the applicable amount set forth opposite such fiscal quarter on
Schedule 1.01G.
"Consolidated Subsidiary" means with respect to any Person at any
date any Subsidiary of such Person or other entity the accounts of which would
be consolidated with those of such Person in its consolidated financial
statements if such statements were prepared as of such date in accordance with
GAAP.
"Consolidated Total Assets" means at any date the total consolidated
assets of Holdings and its Consolidated Subsidiaries determined as of such date.
"Copyright" means any of the following, whether now existing or
hereafter arising, created or acquired: (i) all common law and/or statutory
rights in all copyrightable subject matter under the laws of the United States
or any other country (whether or not the underlying works of authorship have
been published); (ii) all registrations and applications for registration of any
such copyright in the United States or any other country, including
registrations, recordings, supplemental, derivative or collective work
registrations and pending applications for registrations in the United States
Copyright Office or any other country; (iii) all computer programs, web pages,
computer data bases and computer program flow diagrams, including all source
codes and object codes related to any or all of the foregoing; (iv) all tangible
property embodying or incorporating any or all of the foregoing, whether in
completed form or in some lesser state of completion, and all masters,
duplicates, drafts, versions, variations and copies thereof, in all formats; (v)
all claims for, and rights to sue for, past, present and future infringement of
any of the foregoing; (vi) all income, royalties, damages and payments now or
hereafter due or payable with respect to any of the foregoing, including,
without limitation, damages and payments for past, present or future
infringements thereof and payments and damages under all Copyright Licenses in
connection therewith; (vii) all rights in any of the foregoing, whether arising
under the laws of the United
- 11 -
States or any foreign country or otherwise, to copy, record, synchronize,
broadcast, transmit, perform and/or display any of the foregoing or any matter
which is the subject of any of the foregoing in any manner and by any process
now known or hereafter devised; and (viii) the name and title of each Copyright
item and all rights of any Credit Party to the use thereof, including, without
limitation, rights protected pursuant to trademark, service mark, unfair
competition, anti-cybersquatting and/or the rules and principles of any other
applicable statute, common law or other rule or principle of law now existing or
hereafter arising.
"Copyright License" means any agreement now or hereafter in
existence granting to any Credit Party any rights, whether exclusive or
non-exclusive, to use another Person's copyrights or copyright applications, or
pursuant to which any Credit Party has granted to any other Person, any right,
whether exclusive or non-exclusive, with respect to any Copyright, whether or
not registered.
"Credit Exposure" has the meaning set forth in the definition of
"Required Lenders" in this Section 1.01.
"Credit Extension" means a Borrowing or the issuance, renewal or
extension of a Letter of Credit.
"Credit Party" means each of Holdings, Intermediate Holdings, the
Borrower and each Subsidiary Guarantor, and "Credit Parties" means any
combination of the foregoing.
"Debt" of any Person means at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person under conditional sale or other title retention
agreements relating to property purchased by such Person to the extent of the
value of such property (other than customary reservations or retentions of title
under agreements with suppliers entered into in the ordinary course of
business), (iv) all obligations, other than intercompany items, of such Person
to pay the deferred purchase price of property or services (other than trade
accounts and accrued expenses arising in the ordinary course of business), (v)
the Attributable Debt of such Person in respect of Capital Lease Obligations,
(vi) (other than the Management Put Rights up to a maximum aggregate amount of
$8,000,000) all obligations of such Person to purchase securities or other
property which arise out of or in connection with the sale of the same or
substantially similar securities or property and which mature or otherwise
become non-contingent on or prior to the later of 90 days after the Revolving
Termination Date and the Term B Maturity Date, (vii) all non-contingent
obligations (and, solely for purposes of Section 7.01 and Section 8.01(e), all
contingent obligations) of such Person to reimburse any bank or other Person in
respect of amounts paid under a letter of credit, bankers' acceptance or similar
instrument, (viii) all obligations of others secured by (or for which the holder
of such obligations has an existing right, contingent or otherwise, to be
secured by) a Lien on, or payable out of the proceeds of production from, any
property or asset of such Person, whether or not such obligation is assumed by
such Person; provided that the amount of any Debt of others that constitutes
Debt of such Person solely by reason of this clause (viii) shall not for
purposes of this Agreement exceed the greater of the book value or the fair
market value of the properties or assets subject to such Lien, (ix) all Guaranty
Obligations of such Person in respect of Debt of another Person, (x) all Debt
Equivalents of such Person, (xi) all Derivatives Obligations of such Person
(determined at their then respective Derivatives Termination Values) and (xii)
the Debt of any other Person (including any partnership in which such Person is
a general partner and any unincorporated joint venture in which such Person is a
joint venturer) to the extent such Person would be liable therefor under
applicable law or any agreement or instrument by virtue of such Person's
ownership interest in or other relationship with such entity, except to the
extent the terms of such Debt provide that such person shall not be liable
therefore; provided (i) Debt shall not include (x) earn out obligations until
matured or earned or employee consulting agreements and (y) for the purposes
only of Section 7.17, the
- 12 -
Derivatives Termination Value, and (ii) that the amount of any Limited Recourse
Debt of any Person shall be equal to the lesser of (A) the aggregate principal
amount of such Limited Recourse Debt for which such Person provides credit
support of any kind (including any undertaking agreement or instrument that
would constitute Debt), is directly or indirectly liable as a guarantor or
otherwise or is the lender and (B) the fair market value of any assets securing
such Debt or to which such Debt is otherwise recourse.
"Debt Equivalents" of any Person means any Equity Interest of such
Person which by its terms (or by the terms of any security for which it is
convertible or for which it is exchangeable or exercisable), or upon the
happening of any event or otherwise (including an event which would constitute a
Change of Control but only to the extent such an event occurs), (A) matures or
is mandatorily redeemable or subject to any mandatory repurchase requirement,
pursuant to a sinking fund or otherwise, (B) is convertible into or exchangeable
for Debt or Debt Equivalents or (C) is redeemable or subject to any repurchase
requirement arising at the option of the holder thereof, in each case, in whole
or in part, on or prior to the first anniversary of the latest of the Revolving
Termination Date or the Term B Maturity Date.
"Debt Issuance" means the issuance by any Group Company of any Debt.
"Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"Defaulting Lender" means at any time any Lender that, within one
Business Day of when due, (i) has failed to make a Loan or purchase a
Participation Interest in a Swingline Loan or an LC Obligation required pursuant
to the terms of this Agreement, (ii) other than as set forth in clause (i)
above, has failed to pay to any Agent or any Lender an amount owed by such
Lender pursuant to the terms of the Agreement or any other Senior Finance
Document unless such amount is subject to a good faith dispute or (iii) has been
deemed insolvent or has become subject to a receivership or insolvency event.
"Depositary Bank Agreement" means an agreement between a Credit
Party and any bank or other depositary institution, substantially in the form of
Exhibit D to the Security Agreement, as the same may be amended, modified or
supplemented from time to time.
"Derivatives Agreement" means (i) any and all rate swap
transactions, basis swaps, credit derivative transactions, forward rate
transactions, commodity swaps, commodity options, forward commodity contracts,
equity or equity index swaps or options, bond price or bond index swaps or
options or forward bond or forward bond price or forward bond index
transactions, interest rate options, forward foreign exchange transactions, cap
transactions, floor transactions, collar transactions, currency swap
transactions, cross-currency rate swap transactions, currency options, spot
contracts or any other similar transactions or any combination of any of the
foregoing (including any options to enter into any of the foregoing), whether or
not any such transaction is governed by or subject to any master agreement and
(ii) any and all transactions of any kind, and the related confirmations, which
are subject to the terms and conditions of, or governed by, any form of master
agreement published by the International Swaps and Derivatives Association,
Inc., any International Foreign Exchange Master Agreement or any other master
agreement.
"Derivatives Creditor" means any Lender or any Affiliate of any
Lender from time to time party to one or more Derivatives Agreements permitted
hereunder with a Credit Party (even if any such Lender for any reason ceases
after the execution of such agreement to be a Lender hereunder), and its
successors and assigns, and "Derivatives Creditors" means any two or more of
them, collectively.
- 13 -
"Derivatives Obligations" of any Person means all obligations
(including, without limitation, any amounts which accrue after the commencement
of any bankruptcy or insolvency proceeding with respect to such Person, whether
or not allowed or allowable as a claim under any bankruptcy or insolvency
proceeding) of such Person in respect of any Derivatives Agreement, excluding
any amounts which such Person is entitled to set-off against its obligations
under applicable law.
"Derivatives Termination Value" means, at any date and in respect of
any one or more Derivatives Agreements, after taking into account the effect of
any legally enforceable netting agreements relating to such Derivatives
Agreements, (i) for any date on or after the date such Derivatives Agreements
have been closed out and termination value(s) determined in accordance
therewith, such termination value(s), and (ii) for any date prior to the date
referenced in clause (i), the amount(s) determined as the mark-to-market
value(s) for such Derivatives Agreements, as determined based upon one or more
mid-market or other readily available quotations provided by any recognized
dealer in such Derivatives Agreements (which may include any Lender).
"Dollars" and the sign "$" means lawful money of the United States
of America.
"Domestic Subsidiary" means with respect to any Person each
Subsidiary of such Person which is incorporated under the laws of the United
States or any state thereof, and the District of Columbia, and "Domestic
Subsidiaries" means any two or more of them.
"Effective Date" means the date this Agreement becomes effective in
accordance with Section 10.18.
"Eligible Assignee" means (i) any Lender, (ii) any Affiliate of a
Lender, (iii) any Approved Fund and (iv) any other commercial bank, finance
company, insurance company or other financial institution or fund (other than a
natural Person) approved by (A) the Administrative Agent, (B) in the case of any
assignment of a Revolving Commitment, the Issuing Lenders and the Swingline
Lender and unless (y) the assignment is being made to such person by an Agent on
or prior to the Syndication Date in consultation with the Borrower or (z) a
Default or an Event of Default has occurred and is continuing at the time any
assignment is effected pursuant to Section 10.06(b), the Borrower (each such
approval not to be unreasonably withheld, conditioned or delayed and any such
approval required of the Borrower to be deemed given by the Borrower if no
objection from the Borrower is received by the assigning Lender and the
Administrative Agent within five Business Days after notice of such proposed
assignment has been provided by the assigning Lender to the Borrower); provided,
however, that (i) Holdings and its Affiliates shall not qualify as Eligible
Assignees; and (ii) that no Person shall be an Eligible Assignee if such Person
appears on the list of Specially Designated Nationals and Blocked Persons
prepared by the U.S. Treasury Department's Office of Foreign Assets Control or
the purchase by such Person of an assignment or the performance by any Agent of
its duties under the Senior Finance Documents with respect to such Person
violates or would violate any Anti-Terrorism Law.
"Employee Benefit Arrangements" means, in any jurisdiction, the
benefit schemes or arrangements in respect of any employees or past employees
operated by any Group Company or in which any Group Company participates and
which provide benefits on retirement, ill-health, injury, death or voluntary
withdrawal from or termination of employment, including termination indemnity
payments and life assurance and post-retirement medical benefits.
"Environmental Laws" means all Laws relating in any way to the
protection of the environment, the preservation or reclamation of natural
resources, the management, release or threatened release of any Hazardous
Material or health and safety matters.
- 14 -
"Environmental Liability" means any liability, contingent or
otherwise (including any liability for damages, costs of remediation, fines,
penalties or indemnities), of any Group Company directly or indirectly resulting
from or based on (i) violation of any Environmental Law, (ii) the generation,
use, handling, transportation, storage, treatment or disposal of any Hazardous
Material, (iii) exposure to any Hazardous Material, (iv) the release or
threatened release of any Hazardous Material into the environment or (v) any
contract, agreement or other consensual arrangement pursuant to which liability
is assumed or imposed with respect to any of the foregoing.
"Equity Equivalents" means with respect to any Person any rights,
warrants, options, convertible securities, exchangeable securities, indebtedness
or other rights, in each case exercisable for or convertible or exchangeable
into, directly or indirectly, Equity Interests of such Person or securities
exercisable for or convertible or exchangeable into Equity Interests of such
Person, whether at the time of issuance or upon the passage of time or the
occurrence of some future event.
"Equity Interests" means all shares of capital stock, partnership
interests (whether general or limited), limited liability company membership
interests, beneficial interests in a trust and any other interest or
participation that confers on a Person the right to receive a share of profits
or losses, or distributions of assets, of an issuing Person, but excluding any
debt securities convertible into such Equity Interests.
"Equity Issuance" means (i) any sale or issuance by any Group
Company to any Person other than Holdings or a Subsidiary of Holdings of any
Equity Interests or any Equity Equivalents (other than any such Equity
Equivalents that constitute Debt) and (ii) the receipt by any Group Company of
any cash capital contributions, whether or not paid in connection with any
issuance of Equity Interests of any Group Company, from any Person other than
Holdings or a Subsidiary of Holdings.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended, and any rule or regulation issued thereunder.
"ERISA Affiliate" means each business or entity which is or was a
member of a "controlled group of corporations", under "common control" or a
member of an "affiliated service group" with a Group Company within the meaning
of Section 414(b), (c) or (m) of the Code, or required or was required to be
aggregated with a Group Company under Section 414(o) of the Code or is or was
under "common control" with a Group Company, within the meaning of Section
4001(a)(14) of ERISA.
"ERISA Event" means:
(i) a reportable event as defined in Section 4043 of ERISA
and the regulations issued under such Section with respect to a Plan,
excluding, however, such events as to which the PBGC by regulation has
waived the requirement of Section 4043(a) of ERISA that it be notified
within 30 days of the occurrence of such event;
(ii) the requirements of Section 4043(b) of ERISA apply with
respect to a contributing sponsor, as defined in Section 4001(a)(13) of
ERISA, of any Plan, and an event described in paragraph (9), (10), (11),
(12) or (13) of Section 4043(c) of ERISA is reasonably expected to occur
with respect to such Plan within the following 30 days;
(iii) (x) the failure to meet the minimum funding standard of
Section 412 of the Code with respect to any Plan (whether or not waived in
accordance with Section 412(d) of the Code), the application for a minimum
funding waiver under Section 303 of ERISA with respect to any Plan, or the
failure to make by its due date a required installment under Section
- 15 -
412(m) of the Code with respect to any Plan; or (y) the failure to make
any required contribution to a Multiemployer Plan;
(iv) the incurrence of any material liability by a Group
Company or any ERISA Affiliate pursuant to Title I or IV of ERISA or the
penalty or excise tax provisions of the Code relating to employee benefit
plans (as defined in Section 3 of ERISA), or the occurrence or existence
of any event, transaction or condition that could reasonably be expected
to result in the incurrence of any such material liability by a Group
Company or any ERISA Affiliate, or in the imposition of any lien on any of
the rights, properties or assets of a Group Company or any ERISA
Affiliate, in either case pursuant to Title I or IV of ERISA or to such
penalty or excise tax provisions of the Code or to Section 401(a)(29) or
412 of the Code;
(v) the provision by the administrator of any Plan pursuant
to Section 4041(a)(2) of ERISA of a notice (or the reasonable expectation
of such provision of notice) of intent to terminate such Plan in a
distress termination described in Section 4041(c) of ERISA, the
institution by the PBGC of proceedings to terminate any Plan or the
occurrence of any event or condition which could reasonably be expected to
constitute grounds under ERISA for the termination of, or the appointment
of a trustee by the PBGC to administer, any Plan;
(vi) the withdrawal of a Group Company or ERISA Affiliate in
a complete or partial withdrawal (within the meaning of Sections 4203 and
4205 of ERISA) from any Multiemployer Plan if there is any material
liability therefor, or the receipt by a Group Company or ERISA Affiliate
of notice from any Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends
to terminate or has terminated under Section 4041A or 4042 of ERISA;
(vii) the imposition of material liability (or the reasonable
expectation thereof) on a Group Company or ERISA Affiliate pursuant to
Section 4062, 4063, 4064 or 4069 of ERISA or by reason of the application
of Section 4212(c) of ERISA;
(viii) the assertion of a material claim (other than routine
claims for benefits) against any Plan or the assets thereof, or against a
Group Company in connection with any Plan;
(ix) the receipt from the United States Internal Revenue
Service of notice of the failure of any Plan (or any Employee Benefit
Arrangement intended to be qualified under Section 401(a) of the Code) to
qualify under Section 401(a) of the Code, or the failure of any trust
forming part of any Plan to qualify for exemption from taxation under
Section 501(a) of the Code, and, with respect to Multiemployer Plans,
notice thereof to any Group Company; or
(x) the establishment or amendment by a Group Company of any
Welfare Plan that provides post-employment welfare benefits in a manner
that would increase the liability of a Group Company.
"Eurodollar Loan" means at any date a Loan which bears interest at a
rate determined by reference to the Adjusted London Interbank Offered Rate.
"Eurodollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any other entity succeeding
to the functions currently performed thereby) for determining the maximum
reserve requirement for a member bank of the Federal Reserve System in New York
City with deposits exceeding five billion Dollars in respect of "Eurocurrency
liabilities" (or in respect of any other
- 16 -
category of liabilities which includes deposits by reference to which the
interest rate on Eurodollar Loans is determined or any category of extensions of
credit or other assets which includes loans by a non-United States office of any
Lender to United States residents), whether or not a Lender has any Eurocurrency
liabilities subject to such reserve requirement at that time. Eurodollar Loans
shall be deemed to constitute Eurocurrency liabilities and as such shall be
deemed subject to reserve requirements without benefits of credits for
prorations, exceptions or offsets that may be available from time to time to a
Lender. The Adjusted London Interbank Offered Rate shall be adjusted
automatically on and as of the effective date of any change in the Eurodollar
Reserve Percentage.
"Event of Default" has the meaning set forth in Section 8.01.
"Evergreen Letter of Credit" has the meaning set forth in Section
2.05(c).
"Excess Cash Flow" means for any period an amount equal to (i)
Consolidated EBITDA for such period plus (ii) all cash extraordinary, unusual or
non recurring gains, if any, during such period (whether or not accrued in such
period), plus (iii) (x) the decrease, if any, in Consolidated Adjusted Working
Capital less (y) the decrease, if any, in the principal amount of Revolving
Loans and Swingline Loans, in each case from the first day to the last day of
such period, minus (iv) the amount, if any, which, in the determination of
Consolidated Net Income for such period, has been included in respect of income
or gain from Asset Dispositions of Holdings and its Consolidated Subsidiaries to
the extent utilized or repay or prepay Loans pursuant to Section 2.09(b)(iv),
minus (v) the aggregate amount (without duplication and in each case except to
the extent paid, directly or indirectly, with proceeds of any Equity Issuance or
Debt Issuance (other than Revolving Loans) by any Group Company) of (A) the sum
of (x) cash payments during such period in respect of Consolidated Capital
Expenditures allowed under Section 7.14 plus (y) to the extent amounts permitted
to be paid during such period in respect of Consolidated Capital Expenditures
are carried forward to the next succeeding period in accordance with Section
7.14(b), the aggregate amounts of all cash payments (not to exceed such
permitted carryforward amount) in respect of such Consolidated Capital
Expenditures made during the first 90 days of such next succeeding period (it
being understood and agreed that any cash payments in respect of Consolidated
Capital Expenditures deducted from Excess Cash Flow pursuant to this clause
(v)(A)(y) shall not thereafter be deducted pursuant to clause (v)(A)(x) above in
the determination of Excess Cash Flow for the period during which such payments
were actually paid), (B) cash payments during such period in respect of
Permitted Business Acquisitions allowed under Section 7.06(a)(xiii), other
permitted Investments allowed under Section 7.06(a)(xxi) and Permitted Joint
Ventures allowed under Section 7.06(a)(xvii), (C) permitted optional prepayments
of Debt (other than Subordinated Debt) during such period, (D) to the extent not
included in clause (v) above, repayments or prepayments of the Revolving Loans
and Swingline Loans to the extent the Revolving Commitments and the Swingline
Commitment are permanently reduced at the time of such payment, (E) earn-out
payments paid in cash during such period, (F) the aggregate amount of all
Restricted Payments actually paid in cash in accordance with this agreement by
Holdings during such period, (G) the aggregate amount of all financial advisory
fees, accounting fees, legal fees and other similar advisory and consulting fees
and related out-of-pocket expenses incurred as a result of the Transaction or
any Permitted Business Acquisition and actually paid in cash by Holdings and its
Consolidated Subsidiaries during such period, in each case to the extent added
to Consolidated Net Income in the determination of Consolidated EBITDA for such
period, (H) Transaction related expenditures (including cash charges arising out
of strategic market reviews, early extinguishment of Debt, management bonuses,
restructuring, consolidation, severance or discontinuance of any portion of
operations, employees and/or management) described on Schedule 1.01B and
actually paid in cash by Holdings and its Consolidated Subsidiaries during such
period, in each case to the extent added to Consolidated Net Income in the
determination of Consolidated EBITDA for such period, (I) Consolidated Cash
Interest Expense and, without duplication and only to the extent included in
Consolidated Interest Expense for such period, any expenses identified in
clauses (i) through (vi) of the
- 17 -
definition of Consolidated Cash Interest Expense actually paid in cash by
Holdings and its Consolidated Subsidiaries during such period, (J) Consolidated
Cash Tax Expense actually paid by Holdings and its Consolidated Subsidiaries
during such period, and (K) Consolidated Scheduled Debt Payments actually paid
by Holdings and its Consolidated Subsidiaries during such period, minus (vi) all
cash extraordinary, unusual or non-recurring losses, if any, during such period
(whether or not accrued in such period), minus (vii) (x) the increase, if any,
in Consolidated Adjusted Working Capital less (y) the increase, if any, in the
principal amount of Revolving Loans and Swingline Loans, in each case from the
first day to the last day of such period, minus (viii) to the extent included in
the determination of Consolidated EBITDA for such period, amounts (whether
positive or negative) derived from changes in foreign currency exchange rates
during such period.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"Excluded Asset Disposition" means an Asset Disposition permitted
pursuant to Section 7.05 other than Asset Dispositions pursuant to Sections
7.05(vii), (xiii), and (xv).
"Excluded Equity Issuance" means (i) any issuance by any Subsidiary
of the Borrower of its Equity Interests to the Borrower or any other Subsidiary
of the Borrower, (ii) the receipt by any Subsidiary of the Borrower of a capital
contribution from the Borrower or a Subsidiary of the Borrower, (iii) any
Qualifying Equity Issuance and (iv) any issuance of Equity Interests to qualify
directors where required by applicable Law or to satisfy other requirements of
applicable Law with respect to the ownership of Equity Interests of Foreign
Subsidiaries.
"Excluded Taxes" means with respect to any Agent, any Lender or any
other recipient of any payment to be made by or on account of any obligation of
the Borrower hereunder, (i) income or franchise taxes imposed on (or measured
by) its net income by the United States 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, (ii) any branch profits taxes imposed by the United States or any
similar tax imposed by any other jurisdiction in which the Borrower is located,
and (iii) in the case of any Borrowing with respect to any Lender (other than an
Eligible Assignee pursuant to a request by a Borrower under Section 2.10(d)),
any withholding tax imposed by the jurisdiction in which the Borrower is located
that is (A) imposed on amounts payable to such Lender at the time such Lender
becomes a party to this Agreement or (B) is attributable to such Lender's
failure to comply (other than as a result of a Change in Law) with Section
3.01(d) and Section 10.06(c), except to the extent that such 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 such withholding tax pursuant to Sections 3.01(a).
"Existing Letters of Credit" means the letters of credit issued
before the Closing Date and described by date of issuance, letter of credit
number, undrawn amount, names of beneficiary and date of expiry on Schedule
2.05, and "Existing Letter of Credit" means any one of them.
"Failed Loan" has the meaning set forth in Section 2.03(e).
"Federal Funds Rate" means for any day the rate per annum equal to
the weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided that (i) if such day is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such transactions on
the next preceding Business Day as so published on the next succeeding Business
Day, and (ii) if no such rate is so published on such
- 18 -
next succeeding Business Day, the Federal Funds Rate for such day shall be the
average rate quoted to Merrill Lynch Capital on such day on such transactions as
determined by the Administrative Agent.
"Finance Document" means each Senior Finance Document and each
Derivatives Agreement between one or more Credit Parties and a Derivatives
Creditor evidencing Derivatives Obligations permitted hereunder, and "Finance
Documents" means all of them, collectively.
"Finance Obligations" means, at any date, (i) all Senior Obligations
and (ii) all Derivatives Obligations of a Credit Party permitted hereunder owed
or owing to any Derivatives Creditor.
"Finance Party" means each Lender, the Swingline Lender, each
Issuing Lender, each Derivatives Creditor, each Agent and each Indemnitee and
their respective successors and assigns, and "Finance Parties" means any two or
more of them, collectively.
"Fixed Charge Coverage Ratio" means, for any period, the ratio of
(i) Consolidated EBITDA to (ii) Consolidated Fixed Charges for such period plus
the aggregate amount of Consolidated Capital Expenditures for such period
(exclusive of the portion thereof financed with (A) Capital Leases, Purchase
Money Debt or other Debt (exclusive of Loans) permitted by Section 7.01 incurred
during such period or any Qualifying Equity Issuance or (B) Net Cash Proceeds of
Asset Dispositions received during such period and not required to be applied to
repay Loans or Cash Collateralize Letter of Credit Liabilities pursuant to
Section 2.09(b)(iv)).
"Foreign Pension Plan" means any plan, fund (including, without
limitation, any superannuation fund) or other similar program established or
maintained or formerly established or maintained outside the United States by
any Group Company primarily for the benefit of employees of any Group Company
residing outside the United States, which plan, fund or other similar program
provides or provided, or results or resulted in, retirement income, a deferral
of income in contemplation of retirement or payments to be made upon termination
of employment, and which plan is not subject to ERISA or the Code.
"Foreign Subsidiary" means with respect to any Person any Subsidiary
of such Person that is not a Domestic Subsidiary of such Person.
"Funded Debt" means, with respect to any Person, all Debt (including
current maturities) of such Person (including, in respect of the Credit Parties,
the Senior Obligations) that by its terms matures more than one year after the
date of its creation or matures within one year from such date but is renewable
or extendible, at the option of such Person, to a date more than one year after
such date or arises under a revolving credit or similar agreement that obligates
the lender or lenders to extend credit during a period of more than one year
after such date.
"GAAP" means at any time generally accepted accounting principles as
then in effect in the United States, applied on a basis consistent (except for
changes with which Holdings's independent public accountants have concurred)
with the most recent audited consolidated financial statements of Holdings and
its Consolidated Subsidiaries previously delivered to the Lenders.
"Government Acts" has the meaning set forth in Section 2.05(o)(i).
"Governmental Authority" means any federal, state, local, provincial
or foreign government, authority, agency, central bank, quasi-governmental or
regulatory authority, court or other body or entity, and any arbitrator with
authority to bind a party at law.
- 19 -
"Group Company" means any of Holdings, Intermediate Holdings, the
Borrower or their respective Subsidiaries (regardless of whether or not
consolidated with Holdings or the Borrower for purposes of GAAP), and "Group
Companies" means all of them, collectively.
"Group of Loans" means at any time a group of Loans consisting of
(i) all Loans which are Base Rate Loans at such time or (ii) all Loans which are
Eurodollar Loans having the same Interest Period at such time; provided that, if
a Loan of any particular Lender is converted to or made as a Base Rate Loan
pursuant to Article III, such Loan shall be included in the same Group or Group
of Loans from time to time as it would have been had it not been so converted or
made.
"Guarantor" means each of Holdings and each Subsidiary Guarantor.
"Guaranty" means the Guaranty, substantially in the form of Exhibit
E hereto, by Holdings, Intermediate Holdings, the Borrower and the Subsidiary
Guarantors in favor of the Administrative Agent, as the same may be amended,
modified or supplemented from time to time.
"Guaranty Obligation" means, with respect to any Person, without
duplication, any obligation (other than endorsements in the ordinary course of
business of negotiable instruments for deposit or collection) guarantying,
intended to guaranty, or having the economic effect of guarantying, any Debt or
other obligation of any other Person in any manner, whether direct or indirect,
and including, without limitation, any obligation, whether or not contingent,
(i) to purchase any such Debt or other obligation or any property constituting
security therefor, (ii) to advance or provide funds or other support for the
payment or purchase of such indebtedness or obligation or to maintain working
capital, solvency or other balance sheet condition of such other Person
(including, without limitation, maintenance agreements, comfort letters, take or
pay arrangements, put agreements or similar agreements or arrangements) for the
benefit of the holder of Debt or other obligation of such other Person, (iii) to
lease or purchase property, securities or services primarily for the purpose of
assuring the owner of such Debt or other obligation or (iv) to otherwise assure
or hold harmless the owner of such Debt or obligation against loss in respect
thereof, it being understood and agreed that indemnification and similar
reimbursement obligations entered into in the ordinary course of business in
favor of the obligor on any such Debt or other obligation which are not
enforceable by any holder of such Debt or other obligation and which do not
otherwise constitute Debt hereunder shall not be deemed to constitute Guaranty
Obligations for purposes of this Agreement and the other Senior Finance
Documents. The amount of any Guaranty Obligation hereunder shall (subject to any
limitations set forth therein) be deemed to be an amount equal to the lesser of
the outstanding principal amount or maximum principal amount of the Debt or
other obligation in respect of which such Guaranty Obligation is made.
"Harbour Vest" means Harbour Vest Partners VI - Direct Fund, L.P., a
Delaware limited partnership.
"Hazardous Materials" means all explosive or radioactive substances
or wastes and all hazardous or toxic substances, wastes or other pollutants, or
environmental contaminants, 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 Environment Law.
"Holdings" means The Hillman Companies, Inc., a Delaware
corporation, and its successors.
- 20 -
"Holdings Stockholder Agreement" means the stockholders' agreement
dated as of the date of this Agreement, among Holdings and the Investor Group as
the same may be amended, modified or supplemented from time to time in
accordance with the provisions thereof and this Agreement.
"Indemnified Liabilities" has the meaning set forth in Section
10.05.
"Indemnitee" has the meaning set forth in Section 10.05.
"Insignificant Subsidiaries" means (i) as of the Closing Date, the
Subsidiaries of Holdings listed on Schedule 1.01F hereto and, thereafter, (ii)
any Subsidiary of Holdings which is formed or acquired after the Closing Date
and designated as such by the Borrower; provided, however, that no Subsidiary of
Holdings may remain, or be designated, as an Insignificant Subsidiary if the
assets of such Subsidiary, when taken together with the assets of the other
Insignificant Subsidiaries at such time exceed the lesser of (i) 3% Consolidated
Total Assets or (ii) $7,500,000 in asset value.
"Insurance Proceeds" means all insurance proceeds (other than
business interruption insurance proceeds), damages, awards, claims and rights of
action with respect to any Casualty.
"Intellectual Property" means all Patents, Trademarks, Copyrights,
Software, Licenses, rights in intellectual property, goodwill, trade names,
service marks, trade secrets, confidential or proprietary technical and business
information, know-how, show-how, domain names, mask works, customer lists,
vendor lists, subscription lists, data bases and related documentation,
registrations, franchises and all other intellectual or other similar property
rights.
"Intercompany Note" means a promissory note contemplated by Section
7.06(a)(ix), substantially in the form of Exhibit G hereto, and "Intercompany
Notes" means any two or more of them.
"Interest Coverage Ratio" means for any period the ratio of (i)
Consolidated EBITDA to (ii) Consolidated Cash Interest Expense for such period.
"Interest Payment Date" means (i) as to Base Rate Loans, the last
day of each March, June, September and December and the Maturity Date for Loans
of the applicable Class and (ii) as to Eurodollar Loans, the last day of each
applicable Interest Period and the Maturity Date for Loans of the applicable
Class, and in addition where the applicable Interest Period for a Eurodollar
Loan is greater than three months, then also the date three months from the
beginning of the Interest Period and each three months thereafter.
"Interest Period" means with respect to each Eurodollar Loan, a
period commencing on the date of borrowing specified in the applicable Notice of
Borrowing or on the date specified in the applicable Notice of
Extension/Conversion and ending one, two, three, six or, if available to all of
the Lenders having Commitments or Loans of the applicable Class, and such
Lenders give their prior written consent, nine or twelve months thereafter, as
the Borrower may elect in the applicable notice; provided that:
(i) any Interest Period which would otherwise end on a day
which is not a Business Day shall, subject to clause (v) below, be
extended to the next succeeding Business Day unless such Business Day
falls in another calendar month, in which case such Interest Period shall
end on the next preceding Business Day;
- 21 -
(ii) any Interest Period which begins on the last Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of a calendar month;
(iii) no Interest Period in respect of Term Loans may be
selected which extends beyond a Principal Amortization Payment Date for
Loans of the applicable Class unless, after giving effect to the selection
of such Interest Period, the aggregate principal amount of Term Loans of
the applicable Class which are comprised of Base Rate Loans together with
such Term Loans comprised of Eurodollar Loans with Interest Periods
expiring on or prior to such Principal Amortization Payment Date are at
least equal to the aggregate principal amount of Term Loans of the
applicable Class due on such date;
(iv) no Interest Period in excess of one month may be elected
at any time when a Default or an Event of Default is then in existence;
and
(v) no Interest Period shall be elected which would end
after the Maturity Date for Loans of the applicable Class.
"Intermediate Holdings" means Hillman Investment Company, a Delaware
incorporated company.
"Intermediate Holdings Stockholder Agreement" means the
stockholders' agreement dated as of the date of this Agreement, among
Intermediate Holdings, Holdings and the Investor Group as the same may be
amended, modified or supplemented from time to time in accordance with the
provisions thereof and this Agreement.
"Investment" in any Person means (i) the acquisition (whether for
cash, property, services, assumption of Debt, securities or otherwise) of
assets, shares of Capital Stock, bonds, notes, debentures, time deposits or
other securities of such Person, (ii) any deposit with, or advance, loan or
other extension of credit to or for the benefit of such Person (other than
deposits made in connection with the purchase of equipment or inventory in the
ordinary course of business) or (iii) any other capital contribution to or
investment in such Person, including by way of Guaranty Obligations of any Debt
or other obligation of such Person, any support for a letter of credit issued on
behalf of such Person incurred for the benefit of such Person or any release,
cancellation, compromise or forgiveness in whole or in part of any Debt owing by
such Person. The outstanding amount of any Investment shall be deemed to equal
the difference of (i) the aggregate initial amount of such Investment less (ii)
all returns of principal thereof or capital with respect thereto and all
dividends and other distributions of income received in respect thereof and all
liabilities expressly assumed by another Person (and with respect to which
Holdings and its Subsidiaries, as applicable, shall have received a novation) in
connection with the sale of such Investment.
"Investor Group" means the Sponsor Group, the OTPP, Harbour Vest,
the Management Group and certain other investors identified to the Lead
Arrangers prior to the Closing Date.
"Investor Preferred Equity Issuance" means the $60,000,000
non-convertible accreting preferred stock of Intermediate Holdings issued to the
Investors Group.
"Issuing Lender" means (i) Merrill Lynch Capital or a bank or trust
company acceptable to Merrill Lynch Capital, in its capacity as Administrative
Agent, as issuer of Letters of Credit under Section 2.05(b), and their
respective successor or successors in such capacity; and (ii) each Lender listed
in Schedule 2.05 hereto as the issuer of an Existing Letter of Credit;
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"Junior Debentures" mean the junior subordinated debentures issued
by Holdings to The Hillman Group Capital Trust (the "Junior Debentures Holders")
pursuant to the Junior Debentures Indenture, as such Junior Debentures may be
amended, modified or supplemented from time to time in accordance with the
provisions thereof and the limitations set forth herein.
"Junior Debentures Documents" means the Junior Debentures Indenture,
in each case including all exhibits and schedules thereto, and all other
agreements, documents and instruments relating to the Junior Debentures, in each
case as the same may be amended, modified or supplemented from time to time in
accordance with the provisions thereof and of this Agreement.
"Junior Debentures Indenture" means the indenture dated September 5,
1997 between Holdings and The Bank of New York as the trustee, as such Junior
Debentures Indenture may be amended, modified or supplemented from time to time.
"Landlord Consent and Estoppel" means with respect to any Leased
Mortgaged Property, a Landlord Consent and Estoppel with respect to such Leased
Mortgaged Property, or similar letter, certificate or other instrument in
writing from the lessor under the related lease, reasonably satisfactory in form
and substance to the Lead Arrangers.
"Law" means any international, foreign, Federal, state or local
statute, treaty, rule, guideline, regulation, ordinance, code, or administrative
or judicial precedent or authority, including the interpretation or
administration thereof by any Governmental Authority charged with the
enforcement, interpretation or administration thereof, and all applicable
administrative orders, directed duties, requests, licenses, authorizations and
permits of, and agreements with, any Governmental Authority, in each case
whether or not having the force of law.
"LC Cash Collateral Account" has the meaning set forth in the
Security Agreement.
"LC Commitment" means the commitment of one or more Issuing Lenders
to issue Letters of Credit in an aggregate face amount at any one time
outstanding (together with the amounts of any unreimbursed drawings thereon) of
up to the LC Committed Amount.
"LC Committed Amount" has the meaning set forth in Section 2.05(b).
"LC Disbursement" means (i) a payment or disbursement made by an
Issuing Lender pursuant to an Existing Letter of Credit, and/or (ii) a payment
made by the Administrative Agent pursuant to an LC Support Agreement.
"LC Documents" means, with respect to any Letter of Credit or LC
Support Agreement, such Letter of Credit or LC Support Agreement, any amendments
thereto, any documents delivered in connection therewith, any application
therefor and any agreements, instruments, guaranties or other documents (whether
general in application or applicable only to such Letter of Credit or LC Support
Agreement) governing or providing for (i) the rights and obligations of the
parties concerned or at risk or (ii) any collateral security for such
obligations.
"LC Obligations" means at any time, the sum of (i) the maximum
amount which is, or at any time thereafter may become, available to be drawn
under (A) Existing Letters of Credit then outstanding, and (B) Additional
Letters of Credit to the extent subject to an LC Support Agreement, in each case
assuming compliance with all requirements for drawings referred to in such
Letters of Credit plus, without duplication (ii) the aggregate amount of all LC
Disbursements not yet reimbursed by the Borrower as provided in Section 2.05(g)
to the applicable Issuing Lenders or the Administrative Agent in
- 23 -
respect of drawings under Letters of Credit or payments under LC Support
Agreements, respectively, including any portion of any such obligation to which
a Lender has become subrogated pursuant to Section 2.05(h).
"LC Support Agreement" has the meaning given to it in Section
2.05(b).
"Lead Arrangers" means Merrill Lynch & Co., Merrill Lynch, Pierce,
Fenner & Smith Incorporated and J.P. Morgan Securities Inc. in their capacities
as joint-lead arrangers and joint bookrunners.
"Leased Mortgaged Property" and "Leased Mortgaged Properties" have
the respective meanings set forth in Section 4.01(k).
"Leaseholds" means with respect to any Person all of the right,
title and interest of such Person as lessee or licensee in, to and under leases
or licenses of land, improvements and/or fixtures.
"Lender" means each bank or other lending institution listed on
Schedule 1.01A, each Eligible Assignee that becomes a Lender pursuant to Section
10.06(b) and their respective successors and shall include, as the context may
require, the Swingline Lender in such capacity and each Issuing Lender in such
capacity.
"Letter of Credit" means an Existing Letter of Credit or an
Additional Letter of Credit, and "Letters of Credit" means any combination of
the foregoing.
"Letter of Credit Fee" has the meaning set forth in Section 2.11(b);
"Letter of Credit Request" has the meaning set forth in Section
2.05(c).
"Leverage Ratio" means on any day the ratio of (i) Consolidated
Funded Debt as of such date, less the aggregate amount outstanding under the
Junior Debentures and Subordinated Seller Paper, to (ii) Consolidated EBITDA for
the four consecutive fiscal quarters of Holdings ended on, or most recently
preceding, such day.
"License" means any Patent License, Trademark License, Copyright
License Software License or other license or sub-license of rights in
intellectual property.
"Lien" means, with respect to any asset, any mortgage, pledge,
hypothecation, assignment, deposit arrangement, lien (statutory or other) or
other security interest or preferential arrangement of any kind or nature
whatsoever (including any conditional sale or other title retention agreement,
any financing lease having substantially the same economic effect as any of the
foregoing, and the filing of any financing statement under the Uniform
Commercial Code or comparable Laws of any jurisdiction). Solely for the
avoidance of doubt, neither the filing of a Uniform Commercial Code financing
statement that is a protective lease filing in respect of an operating lease
that does not constitute a security interest in the leased property or otherwise
give rise to a Lien nor the filing of a Uniform Commercial Code financing
statement in respect of consigned goods that does not constitute a security
interest in the consigned goods or otherwise give rise to a Lien shall
constitute a Lien solely on account of being filed in a public office.
"Limited Recourse Debt" means with respect to any Persons, Debt to
the extent: (i) such Person (A) provides no credit support of any kind
(including any undertaking, agreement or instrument that would constitute Debt),
(B) is not directly or indirectly liable as a guarantor or otherwise or (C) does
- 24 -
not constitute the lender; and (ii) no default with respect thereto would permit
upon notice, lapse of time or both any holder of any other Debt (other than the
Loans or the Notes) of such Person to declare a default on such other Debt or
cause the payment thereof to be accelerated or payable prior to its stated
maturity.
"Loan" means a Revolving Loan, a Term B Loan or a Swingline Loan (or
a portion of any Revolving Loans, Term B Loan or Swingline Loans), individually
or collectively as appropriate; provided that, if any such loan or loans (or
portions thereof) are combined or subdivided pursuant to a Notice of
Extension/Conversion, the term "Loan" shall refer to the combined principal
amount resulting from such combination or to each of the separate principal
amounts resulting from such subdivision, as the case may be.
"London Interbank Offered Rate" means, for any Eurodollar Loan for
the Interest Period applicable thereto:
(i) the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate that appears on the page of
the Telerate screen (or any successor thereto) that displays an average
British Bankers Association Interest Settlement Rate for deposits in
Dollars (for delivery on the first day of such Interest Period) for a
period of time comparable to such Interest Period, determined as of
approximately 11:00 A.M. (London time) two Business Days prior to the
first day of such Interest Period; or
(ii) if the rate referred to in clause (i) above does not
appear on such Telerate page or service on such page or service shall
cease to be available, the rate per annum equal to the rate determined by
the Administrative Agent to be the offered rate or such other page or
service that displays an average British Bankers Association Interest
Settlement Rate for deposits in Dollars (for delivery on the first day of
such Interest Period) for a period of time comparable to such Interest
Period, determined as of approximately 11:00 A.M. two Business Days prior
to the first day of such Interest Period; or
(iii) if the rates referenced in the preceding clauses (i) and
(ii) are not available, the rate per annum determined by the
Administrative Agent as the rate of interest (rounded upwards to the next
1/16th of 1%) at which deposits in Dollars for delivery on the first day
of such Interest Period in same day funds in the approximate amount of the
Eurodollar Loan being made, continued or converted by Merrill Lynch
Capital and with a term equivalent to such Interest Period as would be
offered by Merrill Lynch Capital's London branch to major banks in the
offshore Dollar market at their request at approximately 11:00 A.M.
(London time) two Business Days prior to the first day of such Interest
Period.
"Management Agreement" means the Management Service Agreement dated
as of the date of this Agreement, between CHS Management IV, L.P. and The
Hillman Group, Inc. as the same may be amended, supplemented or modified from
time to time in accordance with the terms thereof and of this Agreement
"Management Group" means the Persons identified on Schedule 1.01D.
"Management Put Rights" means the rights of certain members of management of
Holdings or its Subsidiaries to put Equity Interests of Holdings and
Intermediate Holdings to Holdings pursuant to the Executive Securities
Agreements dated as of the date of this Agreement, between HCI Acquisition Corp.
and each such member of management.
- 25 -
"Margin Stock" means "margin stock" as such term is defined in
Regulation U.
"Material Adverse Effect" means (i) any material adverse effect upon
the business, operations, assets, condition (financial or otherwise) liabilities
(contingent or otherwise) or prospects of Holdings and its Consolidated
Subsidiaries, taken as a whole, (ii) a material adverse effect on the ability of
a Credit Party to consummate the transactions contemplated hereby to occur on
the Closing Date or (iii) a material impairment of the rights and remedies of
the Lenders in the aggregate under any Senior Finance Document.
"Maturity Date" means (i) as to Revolving Loans and Swingline Loans,
the Revolving Termination Date and (ii) as to Term B Loans, the Term B Maturity
Date.
"Merger" means the merger of HCI Acquisition Corp. with and into
Holdings pursuant to, and in accordance with the terms of, the Acquisition
Documents, with Holdings as the surviving entity of said merger.
"Moody's" means Moody's Investors Service, Inc., a Delaware
corporation, and its successors or, absent any such successor, such nationally
recognized statistical rating organization as the Borrower and the
Administrative Agent may select.
"Mortgage" means (i) in the case of owned real property interests, a
mortgage or deed of trust, substantially in the form of, or otherwise
substantially identical in substance to the provisions of, Exhibit F-4 hereto,
among any Credit Party, the Collateral Agent and one or more trustees, as the
same may be amended, modified or supplemented from time to time, or (ii) in the
case of a Leasehold, a leasehold mortgage or leasehold deed of trust,
substantially in the form of, or otherwise substantially identical in substance
to the provisions of, Exhibit F-4 hereto, among any Credit Party, the Collateral
Agent and one or more trustees, as the same may be amended, modified or
supplemented from time to time.
"Mortgage Policies" has the meaning set forth in Section 4.01(k)
hereto.
"Mortgaged Properties" means the real property interests of Holdings
and its Subsidiaries described in Schedule 4.01(k) hereto.
"Multiemployer Plan" means a "multiemployer plan" as defined in
Section 3(37) or 4001(a)(3) of ERISA.
"Net Cash Proceeds" means:
(i) with respect to any Asset Disposition, (other than an
Asset Disposition consisting of a lease where one or more Group Companies
is acting as lessor, entered into in the ordinary course of business),
Casualty or Condemnation, (A) the gross amount of all cash proceeds
(including Insurance Proceeds and Condemnation Awards in the case of any
Casualty or Condemnation, except to the extent and for so long as such
Insurance Proceeds or Condemnation Awards constitute Reinvestment Funds or
unless such Insurance Proceeds or Condemnation Awards are to be used for
repair, restoration or replacement pursuant to plans approved by the
Required Lenders) actually paid to or actually received by any Group
Company in respect of such Asset Disposition, Casualty or Condemnation
(including any cash proceeds received as income or other proceeds of any
noncash proceeds of any Asset Disposition, Casualty or Condemnation as and
when received), less (B) the sum of (w) the amount, if any, of all taxes
(other than income taxes) and all income taxes (as estimated in good faith
by the applicable financial or accounting
- 26 -
officer of Holdings giving effect to the overall tax position of Holdings
and its Subsidiaries), and customary fees, brokerage fees, commissions,
costs and other expenses (other than those payable to any Group Company or
to Affiliates of any Group Company other than pursuant to the Management
Agreement as in effect on the Closing Date) that are incurred in
connection with such Asset Disposition, Casualty or Condemnation and are
payable by any Group Company, but only to the extent not already deducted
in arriving at the amount referred to in clause (i)(A) above, (x) all
appropriate amounts that must be set aside as a reserve in accordance with
GAAP against any liabilities associated with such Asset Disposition,
Casualty or Condemnation, (y) if applicable, the amount of any Debt
secured by a Permitted Lien that has been repaid or refinanced in
accordance with its terms with the proceeds of such Asset Disposition,
Casualty or Condemnation; and (z) any payments to be made by any Group
Company as agreed between such Group Company and the purchaser of any
assets subject to an Asset Disposition, Casualty or Condemnation in
connection therewith; and
(ii) with respect to any Equity Issuance or Debt Issuance,
the gross amount of cash proceeds paid to or received by any Group Company
in respect of such Equity Issuance or Debt Issuance as the case may be
(including cash proceeds subsequently as and when received at any time in
respect of such Equity Issuance or Debt Issuance from non-cash
consideration initially received or otherwise), net of underwriting
discounts and commissions or placement fees, investment banking fees,
legal fees, consulting fees, accounting fees and other customary fees and
expenses incurred by any Group Company in connection therewith (other than
those payable to any Group Company or to any Affiliate of any Group
Company) other than pursuant to the Management Agreement as in effect on
the Closing Date.
"Non-Renewal Notice Date" has the meaning set forth in Section
2.05(c).
"Note" means a Revolving Note, a Term B Note or a Swingline Note,
and "Notes" means any combination of the foregoing.
"Notice of Borrowing" means a request by the Borrower for a
Borrowing, substantially in the form of Exhibit A-1 hereto.
"Notice of Extension/Conversion" has the meaning set forth in
Section 2.07(a).
"Operating Lease" means, as applied to any Person, a lease
(including leases which may be terminated by the lessee at any time) of any
property (whether real, personal or mixed) by such Person as lessee which is not
a Capital Lease.
"Other Taxes" has the meaning set forth in Section 3.01(b).
"OTPP" means the Ontario Teachers' Pension Plan Board.
"OTPP Side Letters" means, collectively, (i) that certain side
letter dated as of the date hereof and among Code Hennessy & Simmons IV LP
("CHS"), Holdings, the Borrower and Teabar Capital Corporation, and (ii) that
certain side letter dated as of the date hereof by and among CHS, the Company
and OTPP.
"Owned Mortgaged Property" and "Owned Mortgaged Properties" have the
respective meanings set forth in Section 4.01(k).
- 27 -
"Participation Interest" means a Credit Extension by a Lender by way
of a purchase of a participation interest in an LC Support Agreement or LC
Obligations as provided in Section 2.05(e), in Swingline Loans as provided in
Section 2.01(c)(vi) or in any Loans as provided in Section 2.13.
"Patent" means any of the following: (i) all letters patent and
design letters patent of the United States or any other country; (ii) all
applications filed or in preparation for filing for letters patent and design
letters patent of the United States or any other country including, without
limitation, applications in the United States Patent and Trademark Office or in
any similar office or agency of the United States or any other country or
political subdivision thereof; (iii) all reissues, divisions, continuations,
continuations-in-part, revisions, renewals or extensions thereof; (iv) all
claims for, and rights to sue for, past, present or future infringement of any
of the foregoing; (v) all income, royalties, damages and payments now or
hereafter due or payable with respect to any of the foregoing, including,
without limitation, damages and payments for past, present or future
infringements thereof and payments and damages under all Patent Licenses in
connection therewith; and (vi) all rights corresponding to any of the foregoing
whether arising under the laws of the United States or any foreign country or
otherwise.
"Patent License" means any agreement now or hereafter in existence
granting to any Credit Party any right, whether exclusive or non-exclusive, with
respect to any Person's patent or any invention now or hereafter in existence,
whether or not patentable, or pursuant to which any Credit Party has granted to
any other Person, any right, whether exclusive or non-exclusive, with respect to
any Patent or any invention now or hereafter in existence, whether or not
patentable and whether or not a Patent or application for Patent is in or
hereafter comes into existence on such invention.
"PBGC" means the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA or any entity succeeding to any or
all of its functions under ERISA.
"Perfection Certificate" means with respect to any Credit Party a
certificate, substantially in the form of Exhibit F-3 to this Agreement,
completed and supplemented with the schedules and attachments contemplated
thereby and duly executed by a Responsible Officer of such Credit Party.
"Permit" means any license, permit, franchise, right or privilege,
certificate of authority or order, or any waiver of the foregoing, issued or
issuable by any Governmental Authority.
"Permitted Business Acquisition" means a Business Acquisition;
provided that:
(i) the Equity Interests or property or assets acquired in
such acquisition relate to a line of business similar to the business of
the Borrower or any of its Subsidiaries engaged in on the Closing Date or
reasonably related or ancillary or complimentary thereto;
(ii) the representations and warranties made by the Credit
Parties in each Senior Finance Document shall be true and correct in all
material respects at and as of the date of such acquisition (as if made on
such date after giving effect to such acquisition), except to the extent
such representations and warranties expressly relate to an earlier date
(in which case such representations and warranties shall be true and
correct in all material respects at and as of such earlier date);
(iii) the Administrative Agent or the Collateral Agent, as
applicable, shall have received all items in respect of the Equity
Interests or property or assets acquired in such acquisition (and/or the
seller thereof) required to be delivered by Section 6.10;
- 28 -
(iv) in the case of an acquisition of the Equity Interests of
another Person, (A) except in the case of the incorporation of a new
Subsidiary, the board of directors (or other comparable governing body) of
such other Person shall have duly approved such acquisition and (B) the
Equity Interests so acquired shall constitute 100% of the total Equity
Interests of the issuer thereof (it being understood that, subject to the
limitations set forth in Section 7.06(a)(x) and other provisions of this
Agreement, the foregoing restriction shall not prohibit the acquisition of
a Person which itself has non-Wholly-Owned Subsidiaries);
(v) no Default or Event of Default shall have occurred and
be continuing immediately before or immediately after giving effect to
such acquisition, and Holdings shall have delivered to the Administrative
Agent a Pro-Forma Compliance Certificate demonstrating that, upon giving
effect to such acquisition on a Pro-Forma Basis (with pro-forma
adjustments reasonably satisfactory to the Lead Arrangers), (A) Holdings
shall be in compliance with all of the financial covenants set forth in
Section 7.17 hereof as of the last day of the most recent period of four
consecutive fiscal quarters of Holdings which precedes or ends on the date
of such acquisition and with respect to which the Administrative Agent has
received the consolidated financial information required under Section
6.01(a) and (b) and the certificate required by Section 6.01(c) and (B)
the Leverage Ratio as of the last day of such period shall not be greater
than the ratio set forth below opposite the period during which such
period ends:
FISCAL QUARTERS ENDED DURING RATIO
- ---------------------------- -----
Closing Date through 3/31/05 4.65 to 1.0
4/01/05 through 9/30/05 4.50 to 1.0
10/01/05 through 3/31/06 4.25 to 1.0
4/01/06 through 9/30/06 4.00 to 1.0
10/01/06 through 6/30/07 3.75 to 1.0
7/01/07 through 6/30/08 3.50 to 1.0
7/01/08 through 9/30/08 3.25 to 1.0
10/01/08 through 12/31/08 3.00 to 1.0
1/01/09 through 12/31/09 2.75 to 1.0
1/01/10 through 12/31/10 2.25 to 1.0
1/01/11 through 3/31/11 2.00 to 1.0
(vi) after giving effect to such acquisition, the Revolving
Committed Amount shall be at least $15,000,000 greater than the aggregate
Revolving Outstandings; and
(vii) the aggregate consideration (including cash, earn-out
payments (to the extent required to be reserved for under GAAP),
assumption and/or incurrence of Debt and non-cash consideration for all
such acquisitions occurring after the Closing Date shall not exceed
$60,000,000; provided that (A) the aggregate amount of Debt incurred and
assumed in connection with all such acquisitions shall not exceed
$40,000,000 plus $10,000,000 permitted to be incurred under Section
7.01(xvii), and (B) any incurrence of Debt in connection with such
acquisitions shall be permitted under Section 7.01(xi) or (xvii) and any
assumption of Debt in connection with such acquisitions shall be permitted
under Section 7.01(iv).
"Permitted Encumbrances" means (i) those liens, encumbrances and
other matters affecting title to any Mortgaged Property listed in the Mortgage
Policies in respect thereof and found, on the date of delivery of such Mortgage
Policies to the Collateral Agent in accordance with the terms hereof, reasonably
acceptable by the Collateral Agent, (ii) zoning, building codes, land use and
other similar laws and municipal ordinances which are not violated in any
material respect by the existing
- 29 -
improvements and the present use by the mortgagor of the Premises (as defined in
the respective Mortgage), (iii) such other items to which the Collateral Agent
may consent (such consent not to be unreasonably withheld) and (iv)
encumbrances, right of way and other matters affecting title to any Mortgaged
Property that would not have a Material Adverse Effect.
"Permitted Joint Venture" means a joint venture, in the form of a
corporation, limited liability company, business trust, joint venture,
association, company or partnership, entered into by the Borrower or any of its
Subsidiaries which (i) is engaged in a line of business related, ancillary or
complementary to those engaged in by the Borrower and its Subsidiaries and (ii)
is formed or organized in a manner that limits the exposure of the Borrower and
its Subsidiaries for the liabilities thereof to (A) the Investments of the
Borrower and its Subsidiaries therein permitted under Section 7.06(a)(xvii) and
(B) any Debt of any Permitted Joint Venture or any Guaranty Obligations by the
Borrower or any of its Subsidiaries in respect of such Debt, which Debt or
Guaranty Obligations are permitted at the time under Section 7.01.
"Permitted Liens" has the meaning set forth in Section 7.02.
"Person" means an individual, a corporation, a partnership, an
association, a limited liability company, a trust or an unincorporated
association or any other entity or organization, including a government or
political subdivision or an agency or instrumentality thereof.
"Plan" means an employee pension benefit plan which is covered by
Title IV of ERISA or subject to the minimum funding standards under Section 412
of the Code maintained or formerly maintained by or contributed or formerly
contributed to by any Group Company or any ERISA Affiliate, including a
Multiemployer Plan.
"Pledge Agreement" means the Pledge Agreement, substantially in the
form of Exhibit F-2 hereto, dated as of the date hereof among Holdings,
Intermediate Holdings, the Borrower, the Subsidiary Guarantors and the
Collateral Agent, as the same may be amended, supplemented or modified from time
to time.
"Pledged Collateral" means the "Collateral" as defined in the Pledge
Agreement.
"Pre-Commitment Information" means, taken as an entirety, (i)
information with respect to Holdings and its Subsidiaries contained in the
Confidential Information Memorandum dated November 2003 Holdings or the
Acquisition provided to any Agent or Lender by or on behalf of Holdings prior to
the Closing Date.
"Preferred Stock" means, as applied to the Equity Interests of a
Person, Equity Interests of any class or classes (however designated) which is
preferred as to the payment of dividends or distributions, or as to the
distribution of assets upon any voluntary or involuntary liquidation or
dissolution of such Person, over the Equity Interests of any other class of such
Person.
"Prepayment Account" has the meaning set forth in Section
2.09(b)(x).
"Prime Rate" means for any day the rate of interest announced by
Merrill Lynch Capital in New York City (or such other principal office of the
Administrative Agent as communicated in writing to the Borrower and the Lenders)
from time to time as its Prime Rate for Dollars loaned in the United States. It
is a rate set by Merrill Lynch Capital based upon a variety of factors,
including Merrill Lynch Capital's costs and desired return, general economic
conditions and other factors, and is used as a reference point for pricing some
loans, which may be priced at, above or below such announced rate.
- 30 -
Any change in the interest rate resulting from a change in the Prime Rate shall
take effect at the opening of business on the day specified in the announcement
of such change.
"Principal Amortization Payment" means a scheduled principal payment
on the Term B Loan pursuant to Section 2.08(b).
"Principal Amortization Payment Date" means (i) the last Business
Day of each calendar quarter, commencing with the first such date occurring at
least three months after the Closing Date and ending on the Term B Maturity Date
and (ii) the Term B Maturity Date.
"Pro-Forma Basis" means, for purposes of calculating compliance of
any transaction with any provision hereof, that the transaction in question
shall be deemed to have occurred as of the first day of the most recent period
of four consecutive fiscal quarters of Holdings which precedes or ends on the
date of such transaction and with respect to which the Administrative Agent has
received the financial information for Holdings and its Consolidated
Subsidiaries required under Section 6.01(a) and (b), as applicable, and the
certificate required by Section 6.01(c) for such period. As used in this
definition, "transaction" means (i) any incurrence or assumption by a Group
Company of Attributable Debt in respect of a Sale/Leaseback Transaction under
Section 7.13, (ii) any Permitted Business Acquisition referred to in Section
7.06(a)(xiii) or in clause (v) of the definition of "Permitted Business
Acquisition" set forth in Section 1.01, (iii) any Asset Disposition referred to
in Section 7.05(xiv), or (iv) any computation of Consolidated EBITDA under the
circumstances contemplated by the second sentence of the definition thereof, or
(v) Equity Issuances requiring prepayment under Section 2.09(b)(v), and any
related repayment of Debt. In connection with any calculation of the financial
covenants set forth in Section 7.17 upon giving effect to a transaction on a
"Pro-Forma Basis", (i) any Debt incurred or any Equity Interests issued, and any
related repayment of Debt, by Holdings or any of its Subsidiaries in connection
with such transaction (or any other transaction which occurred during the
relevant four fiscal quarter period) shall be deemed to have been incurred as of
the first day of the relevant four fiscal-quarter period, (ii) if such Debt has
a floating or formula rate, then the rate of interest for such Debt for the
applicable period for purposes of the calculations contemplated by this
definition shall be determined by utilizing the rate which is or would be in
effect with respect to such Debt as at the relevant date of such calculations,
(iii) income statement items (whether positive or negative) attributable to all
property acquired in such transaction or to the Investment comprising such
transaction, as applicable, shall be included as if such transaction has
occurred as of the first day of the relevant four-fiscal-quarter period, (iv)
such other pro forma adjustments which would be permitted or required by
Regulation S-X or S-K under the Securities Act shall be taken into account, and
(v) such other adjustments as may be reasonably agreed between the Borrower and
the Administrative Agent shall be taken into account.
"Pro-Forma Compliance Certificate" means a certificate of the chief
financial officer or chief accounting officer of Holdings delivered to the
Administrative Agent in connection with any "transaction" as defined in the
definition of "Pro-Forma Basis" above and containing reasonably detailed
calculations, upon giving effect to the applicable transaction on a Pro-Forma
Basis, of the Interest Coverage Ratio and the Leverage Ratio as of the last day
of the most recent period of four consecutive fiscal quarters of Holdings which
precedes or ends on the date of the applicable transaction and with respect to
which the Administrative Agent shall have received the consolidated financial
information for Holdings and its Consolidated Subsidiaries required under
Section 6.01(a) or (b), as applicable, and the certificate required by Section
6.01(c) for such period.
"Purchase Money Debt" means Debt of Holdings or any of its
Subsidiaries incurred for the purpose of financing all or any part of the
purchase price or cost of construction or improvement of property used in the
business of Holdings or such Subsidiary; provided that such Debt is incurred
within 120 days after such property is acquired or, in the case of improvements,
constructed.
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"Qualifying Equity Issuance" means (i) any Equity Issuance by
Holdings or Intermediate Holdings to, or any receipt by Holdings or Intermediate
Holdings of a capital contribution from, the Investor Group and any other Person
holding Equity Interests, directly or indirectly, of Holdings or Intermediate
Holdings on the Closing Date and any subsequent holders of preemptive rights in
respect of Equity Interests of Holdings or Intermediate Holdings, the Net Cash
Proceeds of which are contributed immediately, directly or indirectly, to the
common equity of the Borrower, (ii) grants of stock of Holdings or Preferred
Stock of Intermediate Holdings, or options to acquire stock of Holdings or
Preferred Stock of Intermediate Holdings, to the management of Holdings and its
Subsidiaries, and (iii) the issuance by Holdings or Intermediate Holdings for
cash of its common Equity Interests to the Sponsor Group or any other Person if:
(A) 100% of the proceeds of such issuance shall be immediately contributed,
directly or indirectly, by Holdings or Intermediate Holdings (as the case may
be) to the Borrower; (B) after giving effect thereto, no Change of Control shall
have occurred; (C) such stock shall be issued in a private placement exempt from
registration under the Securities Act; (D) the proceeds thereof shall be used
(without duplication) only (w) to make Consolidated Capital Expenditures, (x) to
make Permitted Business Acquisitions pursuant to Section 7.06(a)(xiii),
Investments in Permitted Joint Ventures pursuant to Section 7.06(a)(xvii) and
other Investments pursuant to Section 7.06(a)(xxi), (y) to repay Debt of the
Borrower and its Subsidiaries or (z) to make Restricted Payments pursuant to
Section 7.07(viii), and in any event the proceeds thereof shall not be used to
repay any Subordinated Debt or to make any Restricted Payment other than
Restricted Payments expressly permitted pursuant to Section 7.07(viii); (E)
within five Business Days after such issuance, Holdings or Intermediate Holdings
(as the case may be) shall have delivered to the Administrative Agent a
certificate of the chief financial officer or chief accounting officer of
Holdings (in each case) attesting to the satisfaction of the foregoing
conditions, describing the uses of the proceeds of such issuance and attesting
that such use shall not constitute a Default or an Event of Default; and (F)
such proceeds shall be used within 30 days after such issuance as described in
such certificate.
"Real Property" means, with respect to any Person, all of the right,
title and interest of such Person in and to land, improvements and fixtures,
including Leaseholds.
"Recorded Leasehold Interest" means a Leased Mortgaged Property with
respect to which a Recorded Document has been recorded in all places necessary
or desirable, in the reasonable judgment of the Lead Arrangers, to give
constructive notice of such Leased Mortgaged Property to third-party purchasers
and encumbrancers of the affected real property. For purposes of this
definition, the term "Recorded Document" means, with respect to any Leased
Mortgaged Property, (i) the lease evidencing such Leased Mortgaged Property or a
memorandum thereof, executed and acknowledged by the owner of the affected real
property, as lessor, or (ii) if such Leased Mortgaged Property was acquired or
subleased from the holder of a Recorded Leasehold Interest, the applicable
assignment or sublease document, executed and acknowledged by such holder, in
each case in form and sufficient to give such constructive notice upon
recordation and otherwise in form reasonably satisfactory to the Lead Arrangers.
"Refinanced Agreements" means those instruments, documents and
agreements listed on Schedule 1.01C.
"Refunded Swingline Loan" has the meaning set forth in Section
2.01(c).
"Register" has the meaning set forth in Section 10.06(d).
"Regulation D, T, U or X" means Regulation D, T, U or X,
respectively, of the Board of Governors of the Federal Reserve System as
amended, or any successor regulation.
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"Regulation S-X" means Regulation S-X under the Securities Act, as
amended, or any successor regulation.
"Reinvestment Funds" means, with respect to any Insurance Proceeds
or any Condemnation Award, that portion of such funds as shall, according to a
certificate of a Responsible Officer of Holdings delivered to the Administrative
Agent within 30 days after an executive officer of Holdings becoming aware of
the occurrence of the Casualty or Condemnation giving rise thereto, be
reinvested or contractually committed to be reinvested within one year after the
date of receipt of such Insurance Proceeds or Condemnation Award in the repair,
restoration or replacement of the properties that were the subject of such
Casualty or Condemnation or in other tangible assets of a like nature used or
useful in the ordinary course of business of the Borrower and its Subsidiaries;
provided that (i) the aggregate amount of such proceeds with respect to any such
event or series of related events shall not exceed $15,000,000 without the prior
written consent of the Required Lenders, (ii) such certificate shall be
accompanied by evidence reasonably satisfactory to the Administrative Agent that
any property subject to such Casualty or Condemnation has been or will be
repaired, restored or replaced to, or better than, its condition immediately
prior to such Casualty or Condemnation, or that such Insurance Proceeds or
Condemnation Awards have otherwise been reinvested in tangible assets of a like
nature used or useful in the ordinary course of business of Holdings and its
Subsidiaries, (iii) at the request of the Collateral Agent or the Administrative
Agent, pending such reinvestment in the case of Insurance Proceeds or
Condemnation Awards in excess of $5,000,000, the entire amount of such proceeds
shall be deposited in an account with respect to which an Account Control
Agreement (as defined in the Security Agreement) is in full force and effect,
and (iv) from and after the date of delivery of such certificate, Holdings or
one or more of its Subsidiaries shall diligently proceed, in a commercially
reasonable manner, to complete the repair, restoration or replacement of the
properties that were the subject of such Casualty or Condemnation or otherwise
reinvest such Insurance Proceeds or Condemnation Awards as described in such
certificate; and provided, further, that, if any of the foregoing conditions
shall cease to be satisfied at any time, such funds shall no longer be deemed
Reinvestment Funds and such funds shall immediately be applied to prepayment of
the Loans in accordance with Section 2.09(b); and provided, further, that any
funds not so reinvested within such one year period shall immediately be applied
to the payment of the Loans in accordance with Section 2.09(b).
"Replacement Date" has the meaning set forth in Section 2.10(d).
"Required Lenders" means Lenders whose aggregate Credit Exposure (as
hereinafter defined) constitutes more than 50% of the Credit Exposure of all
Lenders at such time; provided, however, that if any Lender shall be a
Defaulting Lender at such time then there shall be excluded from the
determination of Required Lenders such Lender and the aggregate principal amount
of Credit Exposure of such Lender at such time. For purposes of the preceding
sentence, the term "Credit Exposure" as applied to each Lender shall mean (i) at
any time prior to the termination of the Commitments, the sum of (A) the
Revolving Commitment Percentage of such Lender multiplied by the Revolving
Committed Amount plus (B) the Term B Commitment Percentage of such Lender
multiplied by the aggregate principal amount of the Term B Loans outstanding at
such time, and (ii) at any time after the termination of the Commitments, the
sum of (A) the aggregate amount of the outstanding Loans of such Lender plus (B)
such Lender's Participation Interests in all LC Obligations and Swingline Loans.
"Reset Date" has the meaning set forth in Section 1.05.
"Required Revolving Lenders" means Lenders whose aggregate Revolving
Credit Exposure (as hereinafter defined) constitutes more than 50% of the
Revolving Credit Exposure of all Lenders at such time; provided, however, that
if any Lender shall be a Defaulting Lender at such time then there shall be
excluded from the determination of Required Revolving Lenders such Lender and
the
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aggregate principal amount of Revolving Credit Exposure of such Lender at such
time. For purposes of the preceding sentence, the term "Revolving Credit
Exposure" as applied to each Lender shall mean (i) at any time prior to the
termination of the Revolving Commitments, the Revolving Commitment Percentage of
such Lender multiplied by the Revolving Committed Amount, and (ii) at any time
after the termination of the Revolving Commitments, the sum of (A) the principal
balance of the outstanding Revolving Loans of such Lender plus (B) such Lender's
Participation Interests in all LC Obligations.
"Responsible Officer" means the chief executive officer, president,
senior vice president, vice president, chief financial officer, treasurer or
assistant treasurer, secretary or assistant secretary of a Credit Party. Any
document delivered hereunder that is signed by a Responsible Officer of a Credit
Party shall be conclusively presumed to have been authorized by all necessary
corporate, partnership and/or other action on the part of such Credit Party and
such Responsible Officer shall be conclusively presumed to have acted on behalf
of such Credit Party.
"Restricted Payment" means (i) any dividend or other distribution,
direct or indirect, on account of any class of Equity Interests or Equity
Equivalents of any Group Company, now or hereafter outstanding, (ii) any
redemption, retirement, sinking fund or similar payment, purchase or other
acquisition for value, direct or indirect, of any class of Equity Interests or
Equity Equivalents of any Group Company, now or hereafter outstanding and (iii)
any payment made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire any class of Equity Interests or
Equity Equivalents of any Group Company, now or hereafter outstanding.
"Revolving Borrowing" means a Borrowing comprised of Revolving Loans
and identified as such in the Notice of Borrowing with respect thereto.
"Revolving Commitment" means, with respect to any Lender, the
commitment of such Lender, in an aggregate principal amount at any time
outstanding of up to such Lender's Revolving Commitment Percentage of the
Revolving Committed Amount, (i) to make Revolving Loans in accordance with the
provisions of Section 2.01(a), (ii) to purchase Participation Interests in
Swingline Loans in accordance with the provisions of Section 2.01(c) and (iii)
to purchase Participation Interests in Letters of Credit in accordance with the
provisions of Section 2.05(e).
"Revolving Commitment Percentage" means, for each Lender, the
percentage identified as its Revolving Commitment Percentage on Schedule 1.01A
hereto, as such percentage may be modified in connection with any assignment
made in accordance with the provisions of Section 10.06(b).
"Revolving Committed Amount" means $40,000,000 or such lesser amount
to which the Revolving Committed Amount may be reduced pursuant to Section 2.10.
"Revolving Credit Exposure" has the meaning set forth in the
definition of "Required Revolving Lenders" contained in this Section 1.01.
"Revolving Lender" means each Lender identified in Schedule 1.01A as
having a Revolving Commitment and each Eligible Assignee which acquires a
Revolving Commitment or Revolving Loan pursuant to Section 10.06(b) and their
respective successors.
"Revolving Loan" means a Loan made under Section 2.01(a).
"Revolving Note" means a promissory note, substantially in the form
of Exhibit B-1 hereto, evidencing the obligation of the Borrower to repay
outstanding Revolving Loans, as such note may be amended, supplemented,
extended, renewed or replaced from time to time.
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"Revolving Outstandings" means at any date the aggregate outstanding
principal amount of all Revolving Loans and Swingline Loans plus the aggregate
outstanding amount of all LC Obligations.
"Revolving Termination Date" means the sixth anniversary of the
Closing Date (or, if such day is not a Business Day, the next preceding Business
Day) or such earlier date upon which the Revolving Commitments shall have been
terminated in their entirety in accordance with this Agreement.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw
Hill, Inc., a New York corporation, and its successor or, absent any such
successor, such nationally recognized statistical rating organization as the
Borrower and the Administrative Agent may select.
"Sale/Leaseback Transaction" means any direct or indirect
arrangement with any Person or to which any such Person is a party providing for
the leasing to Holdings or any of its Subsidiaries of any property, whether
owned by Holdings or any of its Subsidiaries as of the Closing Date or later
acquired, which has been or is to be sold or transferred by Holdings or any of
its Subsidiaries to such Person or to any other Person from whom funds have
been, or are to be, advanced by such Person on the security of such property.
"Securities Act" means the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
"Security Agreement" means the Security Agreement, substantially in
the form of Exhibit F-2 hereto, dated as of the date hereof among Holdings,
Intermediate Holdings, the Borrower, the Subsidiary Guarantors and the
Collateral Agent, as the same may be amended, modified or supplemented from time
to time.
"Sellers" means the Optionholders and Stockholders, each as defined
under the Acquisition Agreement.
"Senior Finance Documents" means this Agreement, the Notes, the
Guaranty, the Collateral Documents, each Perfection Certificate, the
Intercompany Notes, each Accession Agreement and each LC Document, collectively,
and all other related agreements and documents issued or delivered hereunder or
thereunder or pursuant hereto or thereto, in each case as the same may be
amended, modified or supplemented from time to time.
"Senior Obligations" means with respect to each Credit Party,
without duplication:
(i) in the case of Borrower, all principal of and interest
(including, without limitation, any interest which accrues after the
commencement of any bankruptcy or insolvency proceeding with respect to
the Borrower, whether or not allowed or allowable as a claim under any
bankruptcy or insolvency proceeding) on any Loan made or LC Obligation
issued under, or any Note issued pursuant to, this Agreement or any other
Senior Finance Document;
(ii) all fees, expenses, indemnification obligations, foreign
currency exchange obligations and other amounts of whatever nature now or
hereafter payable by such Credit Party (including, without limitation, any
amounts which accrue after the commencement of any bankruptcy or
insolvency proceeding with respect to such Credit Party, whether or not
allowed or allowable as a claim under any bankruptcy or insolvency
proceeding) pursuant to this Agreement or any other Senior Finance
Document;
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(iii) all expenses of the Agents as to which one or more of
the Agents have a right to reimbursement by such Credit Party under
Section 10.04 of this Agreement or under any other similar provision of
any other Senior Finance Document, including, without limitation, any and
all sums advanced by the Collateral Agent to preserve the Collateral or
preserve its security interests in the Collateral to the extent permitted
hereunder or under any Senior Finance Document;
(iv) all amounts paid by any Indemnitee as to which such
Indemnitee has the right to reimbursement by such Credit Party under
Section 10.05 of this Agreement or under any other similar provision of
any other Senior Finance Document; and
(v) in the case of each Subsidiary Guarantor, all amounts
now or hereafter payable by such Subsidiary Guarantor and all other
obligations or liabilities now existing or hereafter arising or incurred
(including, without limitation, any amounts which accrue after the
commencement of any bankruptcy or insolvency proceeding with respect to
the Borrower, Holdings or such Subsidiary Guarantor, whether or not
allowed or allowable as a claim under any bankruptcy or insolvency
proceeding) on the part of such Subsidiary Guarantor pursuant to this
Agreement, the Guaranty or any other Senior Finance Document;
together in each case with all renewals, modifications, consolidations or
extensions thereof.
"Software" means all "software" (as defined in the UCC), and also
means and includes all software programs, whether now or hereafter owned,
licensed or leased by a Credit Party, designed for use on Computer Hardware,
including, without limitation, all operating system software, utilities and
application programs in whatever form and whether or not embedded in goods, all
source code and object code in magnetic tape, disk or hard copy format or any
other listings whatsoever, all firmware associated with any of the foregoing all
documentation, flowcharts, logic diagrams, manuals, specifications, training
materials, charts and pseudo codes associated with any of the foregoing, and all
options, warranties, services contracts, program services, test rights,
maintenance rights, support rights, renewal rights and indemnifications relating
to any of the foregoing.
"Software License" means any agreement (including any agreement
constituting a Copyright License, Patent License and/or Trademark License) now
or hereafter in existence granting to any Credit Party any right, whether
exclusive or non-exclusive, to use another Person's Software, or pursuant to
which any Credit Party has granted to any other Person, any right, whether
exclusive or non-exclusive, to use any Software, whether or not subject to any
registration.
"Solvent" means, with respect to any Person as of a particular date,
that on such date (i) such Person is able generally to pay its debts and other
liabilities, contingent obligations and other commitments as they mature in the
normal course of business, (ii) such Person does not intend to, and does not
believe that it will, incur debts beyond such Person's ability to pay as such
debts mature, (iii) such Person is not engaged in a business or a transaction,
and is not about to engage in a business or a transaction, for which such
Person's assets would constitute unreasonably small capital after giving due
consideration to the prevailing practice in the industry in which such Person is
engaged or is to engage, (iv) the fair value (determined in accordance with the
United States Bankruptcy Code) of the assets of such Person is greater than the
total amount of liabilities, including, without limitation, probable
liabilities, of such Person and (v) the present fair value (i.e., the amount
that may be realized within a commercially reasonable time either through
collection or sale at the regular market value, conceiving the latter as the
amount that could be obtained for the assets in question within such period by a
capable and diligent businessman from a buyer who is willing to purchase under
ordinary selling conditions) of the assets of such Person will exceed the amount
that will be required to pay the probable liability on such
- 36 -
Person's existing debts as they become absolute and matured. For purposes of
this definition, "debt" means any legal liability, whether matured, unmatured,
liquidated or unliquidated, absolute, fixed or contingent, or (ii) a right to an
equitable remedy for breach of performance if such breach gives rise to a
payment, whether or not such right is an equitable remedy, is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, secured or unsecured.
"Sponsor" means Code Hennessy & Simmons LLC and Code Hennessy &
Simmons IV, LP, collectively, and their respective successors.
"Sponsor Group" means the Sponsor and any of its Subsidiaries or
Affiliates.
"Standby Letter of Credit" has the meaning set forth in Section
2.05(b).
"Stockholder Agreements" means the Holdings Stockholder Agreement
and the Intermediate Holdings Stockholder Agreement.
"Subordinated Debentures" means the subordinated debentures issued
by the Borrower in favor of Allied Capital Corporation (the "Subordinated
Debentures Holder") pursuant to the Subordinated Debentures Indenture, as such
Subordinated Debentures may be amended, modified or supplemented from time to
time in accordance with the limitations set forth herein.
"Subordinated Debentures Documents" means the Subordinated
Debentures Indenture, in each case including all exhibits and schedules thereto,
the Subordination Agreement and all other agreements, documents and instruments
relating to the Subordinated Debentures, in each case as the same may be
amended, modified or supplemented from time to time in accordance with the
provisions thereof and of this Agreement.
"Subordinated Debentures Indenture" means the $47,500,000 loan
agreement dated as of the Closing Date between among others the Borrower and
Allied Capital Corporation, as such Subordinated Debentures Indenture may be
amended, modified or supplemented from time to time.
"Subordinated Debt" of any Person means (i) the Subordinated
Debentures, (ii) the Junior Debentures, and (iii) all other Debt (A) the
principal of which by its terms is not required to be repaid, in whole or in
part, before the first anniversary of the later of the Revolving Termination
Date and the Term B Maturity Date, (B) is contractually or structurally
subordinated in right of payment to such Person's indebtedness, obligations and
liabilities to the Finance Parties under the Senior Finance Documents pursuant
to payment and subordination provisions reasonably satisfactory in form and
substance to the Lead Arrangers and (C) is issued pursuant to credit documents
having covenants, subordination provisions and events of default that in no
event are less favorable, including with respect to rights of acceleration, to
such Person than the terms hereof or are otherwise reasonably satisfactory in
form and substance to the Lead Arrangers.
"Subordinated Seller Paper" means unsecured Subordinated Debt of
Holdings which (i) is issued to a seller of assets or a Person the subject of a
Permitted Business Acquisition in a transaction permitted by this Agreement,
(ii) by its terms does not require the payment of interest in cash or Cash
Equivalents until a date on or after the first anniversary of the later of the
Revolving Termination Date and the Term B Maturity Date, and (iii) is issued on
terms, covenants and conditions satisfactory in all respects to the Lead
Arrangers. For the avoidance of doubt Subordinated Seller Paper shall not
include the Subordinated Debentures.
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"Subordination Agreement" means the subordination and intercreditor
agreement dated on the date hereof and made between the Credit Parties, the
Administrative Agent and the Subordinated Debentures Holder, as the same may be
amended, modified or supplemented from time to time in accordance with the
provisions thereof and of this Agreement.
"Subsidiary" means with respect to any Person any corporation,
partnership, limited liability company, association or other business entity of
which (i) if a corporation, more than 50% of the total voting power of stock
entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by that Person or one or more of the other
Subsidiaries of that Person or a combination thereof, or (ii) if a partnership,
limited liability company, association or business entity other than a
corporation, more than 50% of the partnership or other similar ownership
interests thereof is at the time owned or controlled, directly or indirectly, by
that Person or one or more Subsidiaries of that Person or a combination thereof.
For purposes hereof, a Person or Persons shall be deemed to have more than 50%
ownership interest in a partnership, limited liability company, association or
other business entity if such Person or Persons shall be allocated more than 50%
of partnership, association or other business entity gains or losses or shall be
or control the managing director, manager or a general partner of such
partnership, association or other business entity.
"Subsidiary Guarantor" means each Subsidiary of Holdings existing on
the Closing Date (other than a Foreign Subsidiary) and each Subsidiary of
Holdings (other than a Foreign Subsidiary), except to the extent otherwise
provided in Section 6.10(d), that becomes a party to the Guaranty after the
Closing Date by execution of an Accession Agreement referring to the Guaranty or
otherwise, and "Subsidiary Guarantors" means any two or more of them.
"Swingline Commitment" means the agreement of the Swingline Lender
to make Loans pursuant to Section 2.01(c).
"Swingline Committed Amount" means $5,000,000, as such Swingline
Committed Amount may be reduced pursuant to Section 2.10.
"Swingline Lender" means Merrill Lynch Capital, in its capacity as
the Swingline Lender under Section 2.01(c), and its successor or successors in
such capacity.
"Swingline Loan" means a Base Rate Loan made by the Swingline Lender
pursuant to Section 2.01(c), and "Swingline Loans" means any two or more of such
Base Rate Loans.
"Swingline Loan Request" has the meaning set forth in Section
2.02(b).
"Swingline Note" means a promissory note, substantially in the form
of Exhibit B-3 hereto, evidencing the obligation of the Borrower to repay
outstanding Swingline Loans, as such note may be amended, modified,
supplemented, extended, renewed or replaced from time to time.
"Swingline Termination Date" means the earlier of (i) the Revolving
Termination Date and (ii) the date on which the Swingline Commitment is
terminated in its entirety in accordance with this Agreement.
"Syndication Date" means the earliest of (i) the date which is 30
days after the Closing Date, (ii) the date on which the Lead Arrangers determine
in their sole discretion (and shall notify the Borrower thereof) that the
primary syndication (and the resulting addition of Lenders pursuant to Section
10.06(b)) has been completed and (iii) the date on which the Syndication Agent
has received Term B
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Commitments, or Term B Lenders other than the Lead Arrangers and their
respective Affiliates have acquired Term B Loans in an aggregate amount equal to
the Term B Committed Amount.
"Synthetic Lease Obligation" means the monetary obligation of a
Person under (i) a so-called synthetic, off-balance sheet or tax retention lease
or (ii) an agreement for the use or possession of property creating obligations
that do not appear on the balance sheet of such Person but which, upon the
insolvency or bankruptcy of such Person, would be characterized as the
indebtedness of such person (without regard to accounting treatment).
"Target" means The Hillman Companies, Inc., a Delaware corporation
(prior to the consummation of the Merger).
"Taxes" has the meaning set forth in Section 3.01.
"Term B Borrowing" means a Borrowing comprised of Term B Loans and
identified as such in the Notice of Borrowing with respect thereto.
"Term B Commitment" means, with respect to any Lender, the
commitment of such Lender to make a Term B Loan on the Closing Date in a
principal amount equal to such Lender's Term B Commitment Percentage of the Term
B Committed Amount.
"Term B Commitment Percentage" means, for each Lender, the
percentage identified as its Term B Commitment Percentage on Schedule 1.01A, or
in the applicable Assignment and Acceptance, as such percentage may be (i)
reduced pursuant to Section 2.10(c) and (ii) modified in connection with any
assignment made in accordance with the provisions of Section 10.06(b).
"Term B Committed Amount" means $217,500,000.
"Term B Lender" means each Lender identified on Schedule 1.01A as
having a Term B Commitment and each Eligible Assignee which acquires a Term B
Loan pursuant to Section 10.06(b) and their respective successors.
"Term B Loan" means a Loan made under Section 2.01(b).
"Term B Maturity Date" means the seventh anniversary of the Closing
Date (or if such day is not a Business Day, the next preceding Business Day).
"Term B Note" means a promissory note, substantially in the form of
Exhibit B-2 hereto, evidencing the obligation of the Borrower to repay
outstanding Term B Loans, as such note may be amended, modified or supplemented
from time to time.
"Title Insurance Company" has the meaning set forth in Section
4.01(k).
"Trade Letter of Credit" has the meaning set forth in Section
2.05(b).
"Trademark" means any of the following: (i) all trademarks, trade
names, corporate names, company names, business names, fictitious business
names, trade styles, service marks, logos, certification marks, collective
marks, brand names and trade dress which are or have been used in the United
States or in any state, territory or possession thereof, or in any other place,
nation or jurisdiction, along with all prints and labels on which any of the
foregoing have appeared or appear, package and other designs, and any other
source or business identifiers, and general intangibles of like nature, and the
rights
- 39 -
in any of the foregoing which arise under applicable law; (ii) the
goodwill of the business symbolized thereby or associated with each of the
foregoing; (iii) all registrations and applications in connection therewith,
including, without limitation, registrations and applications in the United
States Patent and Trademark Office or in any similar office or agency of the
United States, any state thereof or any other country or any political
subdivision thereof, (iv) all reissues, extensions and renewals thereof; (v) all
claims for, and rights to sue for, past, present or future infringements of any
of the foregoing; (vi) all income, royalties, damages and payments now or
hereafter due or payable with respect to any of the foregoing, including,
without limitation, damages and payments for past, present or future
infringements thereof and payments and damages under all Trademark Licenses in
connection therewith; and (vii) all rights corresponding to any of the foregoing
whether arising under the laws of the United States or any foreign country or
otherwise.
"Trademark License" means any agreement now or hereafter in
existence granting to any Credit Party any right, whether exclusive or
non-exclusive, to use another Person's trademarks or trademark applications, or
pursuant to which any Credit Party has granted to any other Person, any right,
whether exclusive or non-exclusive, to use any Trademark, whether or not
registered, and the rights to prepare for sale, sell and advertise for sale, all
of the inventory now or hereafter owned by any Credit Party and now or hereafter
covered by such license agreements.
"Transaction" means the events contemplated by the Transaction
Documents to occur on the Closing Date.
"Transaction Documents" means the Acquisition Documents, the
Capitalization Documents, the Subordinated Debenture Documents, and the Senior
Finance Documents, collectively, and "Transaction Document" means any one of
them.
"Trust Common Securities" means the 11.6% trust common securities of
The Hillman Group Capital Trust held by The Hillman Companies, Inc.
"Trust Preferred Securities" means the 11.6% trust preferred
securities issued by Hillman Group Capital Trust pursuant to an amended and
restated declaration of trust dated September 5, 1997 as amended, revised or
modified.
"Type" has the meaning set forth in Section 1.04.
"UCC" means the Uniform Commercial Code as in effect from time to
time in the State of New York; provided that if by reason of mandatory
provisions of law, the perfection, the effect of perfection or non-perfection or
the priority of the security interests of the Collateral Agent in any Collateral
is governed by the Uniform Commercial Code as in effect in a jurisdiction other
than New York, "UCC" means the Uniform Commercial Code as in effect in such
other jurisdiction for purposes of the provisions hereof relating to such
perfection, effect of perfection or non-perfection or priority.
"Unfunded Liabilities" means with respect to each Plan, the amount
(if any) by which the present value of all nonforfeitable benefits under each
Plan exceeds the current value of such Plan's assets allocable to such benefits,
all determined in accordance with the respective most recent valuations for such
Plan using applicable PBGC plan termination actuarial assumptions (the terms
"present value" and "current value" shall have the same meanings specified in
Section 3 of ERISA).
"United States" means the United States of America, including each
of the States and the District of Columbia, but excluding its territories and
possessions.
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"Unused Revolving Commitment Amount" means, for any period, the
amount by which (i) the then applicable aggregate Revolving Committed Amount of
all non-Defaulting Lenders exceeds (ii) the daily average sum for such period of
(A) the aggregate amount of all outstanding Revolving Loans plus (B) the
aggregate amount of all outstanding LC Obligations.
"U.S. Patriot Act" means the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of
2001 (Title III of Pub. L. 107-56 (signed into law October 26, 2001)), as the
same may be amended, supplemented, modified, replaced or otherwise in effect
from time to time.
"Welfare Plan" means a "welfare plan" as such term is defined in
Section 3(1) of ERISA.
"Wholly-Owned Subsidiary" means, with respect to any Person at any
date, any Subsidiary of such Person all of the shares of capital stock or other
ownership interests of which (except directors' qualifying shares are at the
time directly or indirectly owned by such Person and for the purposes of this
Agreement, Intermediate Holdings and the Borrower shall be deemed to be
wholly-owned Subsidiaries of Holdings, notwithstanding the Investor Preferred
Equity Issuance.)
SECTION 1.02 COMPUTATION OF TIME PERIODS AND OTHER DEFINITIONAL
PROVISIONS. For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding". All references to time herein shall be references to Eastern
Standard time or Eastern Daylight time, as the case may be, unless specified
otherwise. References in this Agreement to Articles, Sections, Schedules,
Appendices or Exhibits shall be to Articles, Sections, Schedules, Appendices or
Exhibits of or to this Agreement unless otherwise specifically provided. The
definitions in Section 1.01 shall apply equally to both the singular and plural
forms of the terms defined.
SECTION 1.03 ACCOUNTING TERMS AND DETERMINATIONS. Except as
otherwise expressly provided herein, all accounting terms used herein shall be
interpreted, and all financial statements and certificates and reports as to
financial matters required to be delivered to the Lenders hereunder shall be
prepared, in accordance with GAAP applied on a consistent basis. All financial
statements delivered to the Lenders hereunder shall be accompanied by a
statement from Holdings that GAAP has not changed since the most recent
financial statements delivered by Holdings to the Lenders or if GAAP has changed
describing such changes in detail and explaining how such changes affect the
financial statements. All calculations made for the purposes of determining
compliance with this Agreement shall (except as otherwise expressly provided
herein) be made by application of GAAP applied on a basis consistent with the
most recent annual or quarterly financial statements delivered pursuant to
Section 6.01 (or, prior to the delivery of the first financial statements
pursuant to Section 6.01, consistent with the financial statements described in
Section 5.05(a)); provided, however, if (i) Holdings shall object to determining
such compliance on such basis at the time of delivery of such financial
statements due to any change in GAAP or the rules promulgated with respect
thereto or (ii) either the Administrative Agent or the Required Lenders shall so
object in writing within 60 days after delivery of such financial statements (or
after the Lenders have been informed of the change in GAAP affecting such
financial statements, if later), then such calculations shall be made on a basis
consistent with the most recent financial statements delivered by Holdings to
the Lenders as to which no such objection shall have been made. Any financial
ratios required to be maintained by any Group Company pursuant to this Agreement
shall be calculated by dividing the appropriate component by the other
component, carrying the result to one place more than the number of places by
which such ratio is expressed herein and rounding the result up or down to the
nearest number (with a rounding-up if there is no nearest number).
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SECTION 1.04 CLASSES AND TYPES OF BORROWINGS. The term "Borrowing"
denotes the aggregation of Loans of one or more Lenders made to the Borrower
pursuant to Article II on the same date, all of which Loans are of the same
Class and Type (subject to Article III) and, except in the case of Base Rate
Loans, have the same initial Interest Period. Loans hereunder are distinguished
by "Class" and "Type". The "Class" of a Loan (or of a Commitment to make such a
Loan or of a Borrowing comprised of such Loans) refers to whether such Loan is a
Revolving Loan or a Term B Loan. The "Type" of a Loan refers to whether such
Loan is a Eurodollar Loan or a Base Rate Loan. Identification of a Loan (or a
Borrowing) by both Class and Type (e.g., a "Term B Eurodollar Loan") indicates
that such Loan is a Loan of both such Class and such Type (e.g., both a Term B
Loan and a Eurodollar Loan) or that such Borrowing is comprised of such Loans.
ARTICLE II
THE CREDIT FACILITIES
SECTION 2.01 COMMITMENTS TO LEND.
(a) Revolving Loans. Each Revolving Lender severally agrees, on
the terms and conditions set forth in this Agreement, to make Revolving Loans to
the Borrower pursuant to this Section 2.01(a) from time to time during the
Availability Period in amounts such that its Revolving Outstandings shall not
exceed (after giving effect to all Revolving Loans repaid, all reimbursements of
LC Disbursements made, and all Refunded Swingline Loans paid concurrently with
the making of any Revolving Loans) its Revolving Commitment; provided that,
immediately after giving effect to each such Revolving Loan, (i) the aggregate
Revolving Outstandings shall not exceed the Revolving Committed Amount and (ii)
with respect to each Revolving Lender individually, such Lender's outstanding
Revolving Loans plus its (other than the Swingline Lender's in its capacity as
such) Participation Interests in outstanding Swingline Loans plus its
Participation Interests in outstanding LC Obligations shall not exceed such
Lender's Revolving Commitment Percentage of the Revolving Committed Amount. Each
Revolving Borrowing shall be in an aggregate principal amount of $1,000,000 or
any larger multiple of $100,000 (except that any such Borrowing may be in the
aggregate amount of the unused Revolving Commitments) and shall be made from the
several Revolving Lenders ratably in proportion to their respective Revolving
Commitments. Within the foregoing limits, the Borrower may borrow under this
Section 2.01(a), repay, or, to the extent permitted by Section 2.09, prepay,
Revolving Loans and reborrow under this Section 2.01(a).
(b) Term B Loans. Each Term B Lender severally agrees, on the
terms and conditions set forth in this Agreement, to make a Term B Loan to the
Borrower on the Closing Date in a principal amount not exceeding its Term B
Commitment. The Term B Borrowing shall be made from the several Term B Lenders
ratably in proportion to their respective Term B Commitments. The Term B
Commitments are not revolving in nature, and amounts repaid or prepaid prior to
the Term B Maturity Date may not be reborrowed.
(c) Swingline Loans.
(i) The Swingline Lender agrees, on the terms and subject to
the conditions set forth herein and in the other Senior Finance Documents, to
make a portion of the Revolving Commitments available to the Borrower from time
to time during the Availability Period by making Swingline Loans to the Borrower
in Dollars (each such loan, a "Swingline Loan" and, collectively, the "Swingline
Loans"); provided that (A) the aggregate principal amount of the Swingline Loans
outstanding at any one time shall not exceed the Swingline Committed Amount, (B)
with regard to each Lender individually (other than the Swingline Lender in its
capacity as such), such Lender's outstanding Revolving Loans plus its
Participation Interests in outstanding Swingline Loans plus its Participation
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Interests in outstanding LC Obligations shall not at any time exceed such
Lender's Revolving Commitment Percentage of the Revolving Committed Amount, (C)
with regard to the Revolving Lenders collectively, the sum of the aggregate
principal amount of Swingline Loans outstanding plus the aggregate amount of
Revolving Loans outstanding plus the aggregate amount of LC Obligations
outstanding shall not exceed the Revolving Committed Amount and (D) the
Swingline Committed Amount shall not exceed the aggregate of the Revolving
Commitments then in effect. Swingline Loans shall be made and maintained as Base
Rate Loans and may be repaid and reborrowed in accordance with the provisions
hereof prior to the Swingline Termination Date. Swingline Loans may be made
notwithstanding the fact that such Swingline Loans, when aggregated with the
Swingline Lender's other Revolving Outstandings, exceeds its Revolving
Commitment. The proceeds of a Swingline Borrowing may not be used, in whole or
in part, to refund any prior Swingline Borrowing.
(ii) The principal amount of all Swingline Loans shall be due
and payable on the earliest of (A) the Swingline Termination Date, (B) the
occurrence of a bankruptcy or similar proceeding with respect to the Borrower or
(C) the acceleration of any Loan or the termination of the Revolving Commitments
pursuant to Section 8.02.
(iii) With respect to any Swingline Loans that have not been
voluntarily prepaid by the Borrower or paid by the Borrower when due under
clause (ii) above, the Swingline Lender (by request to the Administrative Agent)
or the Administrative Agent at any time may, on one Business Day's notice,
require each Revolving Lender, including the Swingline Lender, and each such
Lender hereby agrees, subject to the provisions of this Section 2.01(c), to make
a Revolving Loan (which shall be initially funded as a Base Rate Loan) in an
amount equal to such Lender's Revolving Commitment Percentage of the amount of
the Swingline Loans (the "Refunded Swingline Loans") outstanding on the date
notice is given.
(iv) In the case of Revolving Loans made by Lenders other
than the Swingline Lender under clause (iii) above, each such Revolving Lender
shall make the amount of its Revolving Loan available to the Administrative
Agent, in same day funds, at the Administrative Agent's Office, not later than
1:00 P.M. on the Business Day next succeeding the date such notice is given. The
proceeds of such Revolving Loans shall be immediately delivered to the Swingline
Lender (and not to the Borrower) and applied to repay the Refunded Swingline
Loans. On the day such Revolving Loans are made, the Swingline Lender's
Revolving Commitment Percentage of the Refunded Swingline Loans shall be deemed
to be paid with the proceeds of a Revolving Loan made by the Swingline Lender
and such portion of the Swingline Loans deemed to be so paid shall no longer be
outstanding as Swingline Loans and shall instead be outstanding as Revolving
Loans. The Borrower authorizes the Administrative Agent and the Swingline Lender
to charge the Borrower's account with the Administrative Agent (up to the amount
available in such account) in order to pay immediately to the Swingline Lender
the amount of such Refunded Swingline Loans to the extent amounts received from
the Revolving Lenders, including amounts deemed to be received from the
Swingline Lender, are not sufficient to repay in full such Refunded Swingline
Loans. If any portion of any such amount paid (or deemed to be paid) to the
Swingline Lender should be recovered by or on behalf of the Borrower from the
Swingline Lender in bankruptcy, by assignment for the benefit of creditors or
otherwise, the loss of the amount so recovered shall be ratably shared among all
Revolving Lenders in the manner contemplated by Section 2.13.
(v) A copy of each notice given by the Swingline Lender
pursuant to this Section 2.01(c) shall be promptly delivered by the Swingline
Lender to the Administrative Agent and the Borrower. Upon the making of a
Revolving Loan by a Revolving Lender pursuant to this Section 2.01(c), the
amount so funded shall no longer be owed in respect of its Participation
Interest in the related Refunded Swingline Loans.
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(vi) If as a result of any bankruptcy or similar proceeding,
Revolving Loans are not made pursuant to this Section 2.01(c) sufficient to
repay any amounts owed to the Swingline Lender as a result of a nonpayment of
outstanding Swingline Loans, each Revolving Lender agrees to purchase, and shall
be deemed to have purchased, a participation in such outstanding Swingline Loans
in an amount equal to its Revolving Commitment Percentage of the unpaid amount
together with accrued interest thereon. Upon one Business Day's notice from the
Swingline Lender, each Revolving Lender shall deliver to the Swingline Lender an
amount equal to its respective Participation Interest in such Swingline Loans in
same day funds at the office of the Swingline Lender specified or referred to in
Section 10.01. In order to evidence such Participation Interest each Revolving
Lender agrees to enter into a participation agreement at the request of the
Swingline Lender in form and substance reasonably satisfactory to all parties.
In the event any Revolving Lender fails to make available to the Swingline
Lender the amount of such Revolving Lender's Participation Interest as provided
in this Section 2.01(c)(vi), the Swingline Lender shall be entitled to recover
such amount on demand from such Revolving Lender together with interest at the
customary rate set by the Swingline Lender for correction of errors among banks
in New York City for one Business Day and thereafter at the Base Rate plus the
then Applicable Margin for Base Rate Loans.
(vii) Each Revolving Lender's obligation to make Revolving
Loans pursuant to clause (iv) above and to purchase Participation Interests in
outstanding Swingline Loans pursuant to clause (vi) above shall be absolute and
unconditional and shall not be affected by any circumstance, including (without
limitation) (i) any set-off, counterclaim, recoupment, defense or other right
which such Revolving Lender or any other Person may have against the Swingline
Lender, the Borrower, Holdings or any other Credit Party, (ii) the occurrence or
continuance of a Default or an Event of Default or the termination or reduction
in the amount of the Revolving Commitments after any such Swingline Loans were
made, (iii) any adverse change in the condition (financial or otherwise) of the
Borrower, Holdings or any other Person, (iv) any breach of this Agreement or any
other Senior Finance Document by the Borrower or any other Lender, (v) whether
any condition specified in Article IV is then satisfied or (vi) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the forgoing. If such Lender does not pay such amount forthwith upon the
Swingline Lender's demand therefor, and until such time as such Lender makes the
required payment, the Swingline Lender shall be deemed to continue to have
outstanding Swingline Loans in the amount of such unpaid Participation Interest
for all purposes of the Senior Finance Documents other than those provisions
requiring the other Lenders to purchase a participation therein. Further, such
Lender shall be deemed to have assigned any and all payments made of principal
and interest on its Loans, and any other amounts due to it hereunder to the
Swingline Lender to fund Swingline Loans in the amount of the Participation
Interest in Swingline Loans that such Lender failed to purchase pursuant to this
Section 2.01(c)(vii) until such amount has been purchased (as a result of such
assignment or otherwise).
SECTION 2.02 NOTICE OF BORROWINGS.
(a) Borrowings Other Than Swingline Loans. Except in the case of
Swingline Loans, the Borrower shall give the Administrative Agent a Notice of
Borrowing (or telephone notice promptly confirmed by a Notice of Borrowing) not
later than 12 noon. on (i) the Business Day of each Base Rate Borrowing and (ii)
the third Business Day before each Eurodollar Borrowing. Each such Notice of
Borrowing shall be irrevocable and shall specify:
(A) the date of such Borrowing, which shall be a
Business Day;
(B) the aggregate principal amount of such Borrowing;
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(C) the Class and initial Type of the Loans comprising
such Borrowing;
(D) in the case of a Eurodollar Borrowing, the
duration of the initial Interest Period applicable thereto, subject
to the provisions of the definition of Interest Period and to
Section 2.06(a); and
(E) the location and number of the Borrower's account
to which funds are to be disbursed, which shall comply with the
requirements of Section 2.03.
If the duration of the initial Interest Period is not specified with respect to
any requested Eurodollar Borrowing, then the Borrower shall be deemed to have
selected an initial Interest Period of one month, subject to the provisions of
the definition of Interest Period and to Section 2.06(a).
(b) Swingline Borrowings. The Borrower shall request a Swingline
Loan by written notice (or telephone notice promptly confirmed in writing)
substantially in the form of Exhibit A-4 hereto (a "Swingline Loan Request") to
the Swingline Lender and the Administrative Agent not later than 12 Noon on the
Business Day of the requested Swingline Loan. Each such notice shall be
irrevocable and shall specify (i) that a Swingline Loan is requested, (ii) the
date of the requested Swingline Loan (which shall be a Business Day) and (iii)
the principal amount of the Swingline Loan requested and, (iv) the location and
number of the Borrower's account to which funds are to be disbursed, which shall
comply with the requirements of Section 2.03. Each Swingline Loan shall be made
as a Base Rate Loan.
SECTION 2.03 NOTICE TO LENDERS; FUNDING OF LOANS.
(a) Notice to Lenders. Upon receipt of a Notice of Borrowing, the
Administrative Agent shall promptly notify each Lender of such Lender's ratable
share (if any) of the Borrowing referred to therein.
(b) Funding of Loans.
(i) On the date of each Borrowing (other than a Swingline
Borrowing), each Lender participating therein shall make available its
share of such Borrowing, in Federal or other immediately available funds,
to the Administrative Agent at the Administrative Agent's Office. Unless
the Administrative Agent determines that any applicable condition
specified in Article IV has not been satisfied, the Administrative Agent
shall promptly distribute the proceeds to an account designated by the
Borrower from time to time in the Applicable Notice of Borrowing (provided
such account is the subject of an Account Control Agreement (as defined in
the Security Agreement) and is in full force and effect at the date
thereof), or if not so identified, credit the amounts so received to the
general deposit account of the Borrower with the Administrative Agent or,
if a Borrowing shall not occur on such date because any condition
precedent herein shall not have been met, promptly return the amounts
received from the Lenders in like funds.
(ii) Not later than 3:00 P.M. on the date of each Swingline
Borrowing, the Swingline Lender shall, unless the Administrative Agent
shall have notified the Swingline Lender that any applicable condition
specified in Article IV has not been satisfied, make available the amount
of such Swingline Borrowing, in Dollars in Federal or other immediately
available funds, to the Borrower at an account designated by the Borrower
from time to time in the Swingline Loan Request (provided such account is
the subject of an Account Control Agreement (as defined
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in the Security Agreement) and is in full force and effect at the date
thereof), or if not so identified, to the Borrower at the Swingline
Lender's address referred to in Section 10.01.
(c) Funding by the Administrative Agent in Anticipation of Amounts
Due from the Lenders. Unless the Administrative Agent shall have received notice
from a Lender prior to the date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender's share of such Borrowing, the
Administrative Agent may assume that such Lender has made such share available
to the Administrative Agent on the date of such Borrowing in accordance with
subsection (b) of this Section 2.03, and the Administrative Agent may, in
reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Lender shall not have so
made such share available to the Administrative Agent, such Lender and the
Borrower severally agree to repay to the Administrative Agent forthwith within
two Business Days of such corresponding amount, together with interest thereon
for each day from the date such amount is made available to the Borrower until
the date such amount is repaid to the Administrative Agent at (i) a rate per
annum equal to the higher of the Federal Funds Rate and the interest rate
applicable thereto pursuant to Section 2.06, in the case of the Borrower, and
(ii) the Federal Funds Rate, in the case of such Lender. If such Lender shall
repay to the Administrative Agent such corresponding amount, such amount so
repaid shall constitute such Lender's Loan included in such Borrowing for
purposes of this Agreement.
(d) Obligations of Lenders Several. The failure of any Lender to
make a Loan required to be made by it as part of any Borrowing hereunder shall
not relieve any other Lender of its obligation, if any, hereunder to make any
Loan on the date of such Borrowing, but no Lender shall be responsible for the
failure of any other Lender to make the Loan to be made by such other Lender on
such date of Borrowing.
(e) Failed Loans. If any Lender shall fail to make any Loan (a
"Failed Loan") which such Lender is otherwise obligated hereunder to make to the
Borrower on the date of Borrowing thereof, and the Administrative Agent shall
not have received notice from the Borrower or such Lender that any condition
precedent to the making of the Failed Loan has not been satisfied, then, until
such Lender shall have made or be deemed to have made (pursuant to the last
sentence of this subsection (e)) the Failed Loan in full or the Administrative
Agent shall have received notice from the Borrower or such Lender that any
condition precedent to the making of the Failed Loan was not satisfied at the
time the Failed Loan was to have been made, whenever the Administrative Agent
shall receive any amount from the Borrower for the account of such Lender, (i)
the amount so received (up to the amount of such Failed Loan) will, upon receipt
by the Administrative Agent, be deemed to have been paid to the Lender in
satisfaction of the obligation for which paid, without actual disbursement of
such amount to the Lender, (ii) the Lender will be deemed to have made the same
amount available to the Administrative Agent for disbursement as a Loan to the
Borrower (up to the amount of such Failed Loan) and (iii) the Administrative
Agent will disburse such amount (up to the amount of the Failed Loan) to the
Borrower or, if the Administrative Agent has previously made such amount
available to the Borrower on behalf of such Lender pursuant to the provisions
hereof, reimburse itself (up to the amount of the amount made available to the
Borrower); provided, however, that the Administrative Agent shall have no
obligation to disburse any such amount to the Borrower or otherwise apply it or
deem it applied as provided herein unless the Administrative Agent shall have
determined in its sole discretion that to so disburse such amount will not
violate any law, rule, regulation or requirement applicable to the
Administrative Agent. Upon any such disbursement by the Administrative Agent,
such Lender shall be deemed to have made a Base Rate Loan of the same Class as
the Failed Loan to the Borrower in satisfaction, to the extent thereof, of such
Lender's obligation to make the Failed Loan.
SECTION 2.04 EVIDENCE OF LOANS.
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(a) Lender Accounts. Each Lender shall maintain in accordance with
its usual practice an account or accounts evidencing the indebtedness to such
Lender resulting from each Loan made by such Lender from time to time, including
the amounts of principal and interest payable and paid to such Lender from time
to time under this Agreement.
(b) Administrative Agent Records. The Administrative Agent shall
maintain accounts in which it will record (i) the amount of each Loan made
hereunder, the Class and Type of each Loan made and the Interest Period, if any,
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 from
the Borrower and each Lender's share thereof.
(c) Evidence of Debt. The entries made in the accounts maintained
pursuant to subsections (a) and (b) of this Section 2.04 shall be prima facie
evidence of the existence and amounts of the obligations therein recorded;
provided, however, 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
obligations of the Borrower to repay the Loans made to it in accordance with
their terms.
(d) Notes. Notwithstanding any other provision of this Agreement,
if any Lender shall request and receive a Note or Notes as provided in Section
10.06 or otherwise, then the Loans of such Lender shall be evidenced by one or
more Revolving Notes or Term B Notes, as applicable, in each case, substantially
in the form of Exhibit B-1 or B-2 as applicable, payable to the order of such
Lender for the account of its Applicable Lending Office in an amount equal to
the aggregate unpaid principal amount of such Lender's Revolving Loan or Term B
Loan, as applicable. If requested by the Swingline Lender, the Swingline Loans
shall be evidenced by a single Swingline Note, substantially in the form of
Exhibit B-3, payable to the order of the Swingline Lender in an amount equal to
the aggregate unpaid principal amount of the Swingline Loans.
(e) Note Endorsements. Each Lender having one or more Notes issued
by the Borrower shall record the date, amount, Class and Type of each Loan made
by it to the Borrower evidenced by such Note and the date and amount of each
payment of principal made by the Borrower with respect thereto, and may, if such
Lender so elects in connection with any transfer or enforcement of any Note,
endorse on the reverse side or on the schedule, if any, forming a part thereof
appropriate notations to evidence the foregoing information with respect to each
outstanding Loan evidenced thereby; provided that the failure of any Lender to
make any such recordation or endorsement shall not affect the obligations of the
Borrower hereunder or under any such Note. Each Lender is hereby irrevocably
authorized by the Borrower so to endorse each of its Notes and to attach to and
make a part of each of its Notes a continuation of any such schedule as and when
required.
SECTION 2.05 LETTERS OF CREDIT.
(a) Existing Letters of Credit. On the Closing Date, each Issuing
Lender that has issued an Existing Letter of Credit shall be deemed, without
further action by any party hereto, to have sold to each Revolving Lender, and
each such Revolving Lender shall be deemed, without further action by any party
hereto, to have purchased from each such Issuing Lender, without recourse or
warranty, an undivided participation interest in such Existing Letter of Credit
and the related LC Obligations in the proportion its Revolving Commitment
Percentage bears to the Revolving Committed Amount (although any fronting fee
payable under Section 2.11 shall be payable directly to the Administrative Agent
for the accounting of each applicable Issuing Lender, and the Lenders (other
than the applicable Issuing Lender) shall have no right to receive any portion
of such fronting fee) and any security therefore or guaranty
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pertaining thereto. On and after the Closing Date, each Existing Letter of
Credit shall constitute a Letter of Credit for all purposes hereof.
(b) Additional Letters of Credit. The Administrative Agent agrees,
on the terms and conditions set forth in this Agreement, to issue letters of
credit or guarantees (each an "LC Support Agreement") to an Issuing Lender to
induce such Issuing Lender to issue Letters of Credit denominated in Dollars
from time to time before the 30th day prior to the Revolving Termination Date
for the account, and upon the request, of the Borrower and in support of (i)
trade obligations of the Borrower and/or its Subsidiaries, which shall be
payable at sight (each such letter of credit, a "Trade Letter of Credit" and,
collectively, the "Trade Letters of Credit") and (ii) such other obligations of
the Borrower that are acceptable to the Administrative Agent (each such letter
of credit, a "Standby Letter of Credit" and, collectively, the "Standby Letters
of Credit"); provided that, immediately after each Letter of Credit is issued,
(i) the aggregate LC Obligations shall not exceed $15,000,000 (the "LC Committed
Amount"), (ii) the Revolving Outstandings shall not exceed the Revolving
Committed Amount, and (iii) with respect to each individual Revolving Lender,
the aggregate outstanding principal amount of the Revolving Lender's Revolving
Loans plus its Participation Interests in outstanding LC Obligations plus its
(other than the Swingline Lender's) Participation Interests in outstanding
Swingline Loans shall not exceed such Revolving Lender's Revolving Commitment
Percentage of the Revolving Committed Amount. Notwithstanding the foregoing, the
account party for each Additional Letter of Credit shall be the Borrower.
(c) Method of Issuance of Letters of Credit. The Borrower shall
give the Administrative Agent notice substantially in the form of Exhibit A-3
hereto (a "Letter of Credit Request") of the requested issuance or amendment of
a Letter of Credit prior to 1:00 P.M. (Chicago time) on the proposed date of the
issuance or amendment of Trade Letters of Credit (which shall be a Business Day)
and at least three Business Days before the proposed date of issuance or
extension of Standby Letters of Credit (which shall be a Business Day) (or such
shorter period as may be agreed by the applicable Issuing Lender in any
particular instance). In the case of a request for an initial issuance of a
Letter of Credit, such Letter of Credit Request shall specify in form and detail
reasonably satisfactory to the Administrative Agent: (i) the proposed issuance
date of the requested Letter of Credit (which shall be a Business Day); (ii) the
amount thereof; (iii) the expiry date thereof; (iv) the name and address of the
beneficiary thereof; (v) the documents to be presented by such beneficiary in
case of any drawing thereunder; (vi) the full text of any certificate to be
presented by such beneficiary in case of any drawing thereunder; and (vii) such
other matters as the Administrative Agent may require. In the case of a request
for an amendment of any outstanding Letter of Credit, such Letter of Credit
Request shall specify in form and detail reasonably satisfactory to the
Administrative Agent: (i) the Letter of Credit to be amended; (ii) the proposed
date of amendment thereof (which shall be a Business Day); (iii) the nature of
the proposed amendment; and (iv) such other matters as the Administrative Agent
may require. If requested by the Administrative Agent, the Borrower shall also
submit a letter of credit application on the Administrative Agent's standard
form in connection with any request for a letter of credit. The extension or
renewal of any Letter of Credit shall be deemed to be an issuance of such Letter
of Credit. Subject to the provisions of the following paragraph with respect to
Evergreen Letters of Credit, no Letter of Credit shall have a term of more than
one year or shall have a term extending or be extendible beyond the fifth
Business Day before the Revolving Termination Date.
If the Borrower so requests in any applicable Letter of Credit
Request, the Administrative Agent may, in its sole and absolute discretion,
agree to induce an Issuing Lender to issue a Letter of Credit that has automatic
renewal provisions (each, an "Evergreen Letter of Credit"); provided that any
such Evergreen Letter of Credit must permit the Issuing Lender to prevent any
such renewal at least once in each twelve-month period (commencing with the date
of issuance of such Letter of Credit) by giving prior notice to the beneficiary
thereof not later than a day (the "Nonrenewal Notice Date") in each such
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twelve-month period to be agreed upon at the time such Letter of Credit is
issued. Unless otherwise directed by the Administrative Agent, the Borrower
shall not be required to make a specific request to the Administrative Agent for
any such renewal. Once an Evergreen Letter of Credit has been issued, the
Revolving Lenders shall be deemed to have authorized (but may not require) the
Issuing Lender to permit the renewal of such Letter of Credit at any time to a
date not later than the Revolving Termination Date; provided, however, that the
Administrative Agent shall not permit any such renewal if (i) the Issuing Lender
would have no obligation at such time to issue such Letter of Credit in its
renewed form under the terms hereof or (ii) it has received notice (which may be
by telephone or in writing) on or before the Business Day immediately preceding
the Nonrenewal Notice Date (A) from the Administrative Agent that the Required
Revolving Lenders have elected not to permit such renewal or (B) from the
Administrative Agent, any Revolving Lender or the Borrower that one or more of
the applicable conditions specified in Section 4.02 is not then satisfied.
Notwithstanding anything to the contrary contained herein, the Issuing Lender
shall have no obligation to permit the renewal of any Evergreen Letter of Credit
at any time.
Promptly after its delivery of any Letter of Credit or any amendment
to a Letter of Credit to an advising bank with respect thereto or to the
beneficiary thereof, the Issuing Lender will also deliver to the Borrower and
the Administrative Agent a true and complete copy of such Letter of Credit or
amendment.
(d) Conditions to Issuance of Additional Letters of Credit. The
issuance by the Administrative Agent of an LC Support Agreement to induce an
Issuing Lender to issue each Additional Letter of Credit shall, in addition to
the conditions precedent set forth in Section 4.02, be subject to the conditions
precedent that (i) such Letter of Credit shall be reasonably satisfactory in
form and substance to the Administrative Agent, (ii) the Borrower shall have
executed and delivered such other instruments and agreements relating to such
Letter of Credit as the Administrative Agent shall have reasonably requested,
(iii) on the date of (and after giving effect to) such issuance that (A) the
aggregate amount of all LC Obligations will not exceed the LC Committed Amount
and (B) the aggregate Revolving Outstandings will not exceed the aggregate
amount of the Revolving Commitments and (iv) the Issuing Lender shall not have
been notified by the Administrative Agent that any condition specified in
Section 4.02(b) or (c) is not satisfied on the date such Additional Letter of
Credit is to be issued. Notwithstanding any other provision of this Section
2.05, the Administrative Agent shall not be under any obligation hereunder to
issue any LC Support Agreement if: (i) any order, judgment or decree of any
Governmental Authority shall by its terms purport to enjoin or restrain the
Administrative Agent from issuing such LC Support Agreement, or any requirement
of Law applicable to the Administrative Agent or any request or directive
(whether or not having a force of Law) from any Governmental Authority with
jurisdiction over the Administrative Agent shall prohibit, or request that the
Administrative Agent refrain from, the issuance of letters of credit generally
or such LC Support Agreement in particular or shall impose upon the
Administrative Agent with respect to such LC Support Agreement any restriction,
reserve or capital requirement (for which the Administrative Agent is not
otherwise compensated hereunder) not in effect on the Closing Date, or shall
impose upon the Administrative Agent any unreimbursed loss, cost or expense
which was not applicable on the Closing Date and which the Administrative Agent
in good faith deems material to it; or (ii) the issuance of such LC Support
Agreement shall violate any applicable general policies of the Administrative
Agent.
(e) Purchase and Sale of Letter of Credit Participations. Upon the
issuance by an Issuing Lender of an Additional Letter of Credit, the
Administrative Agent shall be deemed, without further action by any party
hereto, to have sold to each Revolving Lender, and each Revolving Lender shall
be deemed, without further action by any party hereto, to have purchased from
the Administrative Agent, without recourse or warranty, an undivided
Participation Interest in the LC Support Agreement obligations in respect of
such Additional Letter of Credit and the related LC Obligations in the
proportion
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its Revolving Commitment Percentage bears to the Revolving Committed Amount
(although any fronting fee payable under Section 2.11 shall be payable directly
to the Administrative Agent for the account of the applicable Issuing Lender,
and the Lenders (other than such Issuing Lender) shall have no right to receive
any portion of any such fronting fee) and any security therefor or guaranty
pertaining thereto. Upon any change in the Revolving Commitments pursuant to
Section 10.06, there shall be an automatic adjustment to the Participation
Interests in all outstanding LC Support Agreements to reflect the adjusted
Revolving Commitments of the assigning and assignee Lenders or of all Lenders
having Revolving Commitments, as the case may be.
(f) Duties of Issuing Lenders and the Administrative Agent to
Revolving Lenders; Reliance. In determining whether to pay under any Letter of
Credit or LC Support Agreement, the relevant Issuing Lender or Administrative
Agent as applicable shall not have any obligation relative to the Revolving
Lenders participating in such Letter of Credit or any LC Support Agreement other
than to determine that any document or documents required to be delivered under
a Letter of Credit have been delivered and that they substantially comply on
their face with the requirements of such Letter of Credit. Any action taken or
omitted to be taken by the Administrative Agent as applicable under or in
connection with any LC Support Agreement or Letter of Credit shall not create
for the Issuing Lender or Administrative Agent as applicable any resulting
liability if taken or omitted in the absence of bad faith, gross negligence or
willful misconduct. Each Issuing Lender or the Administrative Agent as
applicable shall be entitled (but not obligated) to rely, and shall be fully
protected in relying, on the representation and warranty by the Borrower set
forth in the last sentence of Section 4.02 to establish whether the conditions
specified in paragraphs (b) and (c) of Section 4.02 are met in connection with
any issuance or extension of an LC Support Agreement or a Letter of Credit. Each
Issuing Lender or the Administrative Agent as applicable shall be entitled to
rely, and shall be fully protected in relying, upon advice and statements of
legal counsel, independent accountants and other experts selected by such
Issuing Lender or Administrative Agent as applicable and upon any Letter of
Credit, LC support Agreement draft, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopier, telex or
teletype message, statement, order or other document believed by it in good
faith to be genuine and correct and to have been signed, sent or made by the
proper Person or Persons, and may accept documents that appear on their face to
be in order, without responsibility for further investigation, regardless of any
notice or information to the contrary unless the beneficiary and the Borrower
shall have notified such Issuing Lender or the Administrative Agent as
applicable that such documents do not comply with the terms and conditions of
the Letter of Credit. Each Issuing Lender and the Administrative Agent shall be
fully justified in refusing to take any action requested of it under this
Section 2.05 in respect of any Letter of Credit or any LC Support Agreement
unless it shall first have received such advice or concurrence of the Required
Revolving Lenders as it reasonably deems appropriate or it shall first be
indemnified to its reasonable satisfaction by the Revolving Lenders against any
and all liability and expense which may be incurred by it by reason of taking or
continuing to take, or omitting or continuing to omit, any such action.
Notwithstanding any other provision of this Section 2.05, each Issuing Lender
and the Administrative Agent and shall in all cases be fully protected in
acting, or in refraining from acting, under this Section 2.05 in respect of any
LC Support Agreement or Letter of Credit or in accordance with a request of the
Required Revolving Lenders, and such request and any action taken or failure to
act pursuant hereto shall be binding upon all Revolving Lenders and all future
holders of participations in such LC Support Agreement or Letter of Credit.
(g) Reimbursement Obligations. The Borrower shall be irrevocably
and unconditionally obligated forthwith to reimburse each Issuing Lender for any
amounts paid by such Issuing Lender upon any drawing under any Existing Letter
of Credit and reimburse the Administrative Agent upon any payment made by the
Administrative Agent pursuant to an LC Support Agreement, together with any and
all reasonable charges and expenses which the Issuing Lender or Administrative
Agent respectively may pay or incur relative to such drawing or payment and
interest on the amount
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drawn or paid at the rate applicable to Revolving Base Rate Loans for each day
from and including the date such amount is drawn or paid to but excluding the
date such reimbursement payment is due and payable. Such reimbursement payment
shall be due and payable (i) at or before 2:00 P.M. (Chicago time or the
relevant local time, as applicable) on the third Business Day after the date the
Issuing Lender or Administrative Agent (as the case may be) notifies the
Borrower of such drawing or payment; provided that no payment otherwise required
by this sentence to be made by the Borrower at or before 2:00 P.M. (Chicago time
or the relevant local time, as applicable) on any day shall be overdue hereunder
if arrangements for such payment satisfactory to the applicable Issuing Lender
or the Administrative Agent, in its reasonable discretion, shall have been made
by the Borrower at or before 2:00 P.M. (Chicago time or the relevant local time,
as applicable) on such day and such payment is actually made at or before 3:00
P.M. (Chicago time or the relevant local time, as applicable) on such day. In
addition to the foregoing, the Borrower agrees to pay to the Issuing Lender and
Administrative Agent interest, payable on demand, on any and all amounts not
paid by the Borrower to the Issuing Lender or the Administrative Agent (as
applicable) when due under this subsection (g), for each day from and including
the date when such amount becomes due to but excluding the date such amount is
paid in full, whether before or after judgment, at a rate per annum equal to the
sum of 2.00% plus the rate applicable to Revolving Base Rate Loans for such day.
Subject to the satisfaction of all applicable conditions set forth in Article
IV, the Borrower may, at its option, utilize the Swingline Commitment or the
Revolving Commitments, or make other arrangements for payment satisfactory to
the Issuing Lender or the Administrative Agent, (as applicable) for the
reimbursement of all LC Disbursements as required by this subsection (g). Each
reimbursement payment to be made by the Borrower pursuant to this subsection (g)
shall be made to the Issuing Lender or the Administrative Agent (as applicable)
in Federal or other funds immediately available to it at its address referred to
in Section 10.01.
(h) Obligations of Revolving Lenders to Reimburse Issuing Lender
and the Administrative Agent for Unpaid LC Disbursements. If the Borrower shall
not have reimbursed an Issuing Lender or the Administrative Agent (as the case
may be) in full for any LC Disbursement as required pursuant to subsection (g)
of this Section 2.05, the Issuing Lender shall promptly notify the
Administrative Agent, and the Administrative Agent shall promptly notify each
Revolving Lender, (other than the relevant Issuing Lender), and each such
Revolving Lender shall promptly and unconditionally pay to the Administrative
Agent, for the account of such Issuing Lender; or for itself as the case may be,
such Revolving Lender's pro-rata share of such unreimbursed LC Disbursement
(each such Lender's pro rata share of such LC Disbursement determined by the
proportion its Revolving Commitment Percentage bears to the aggregate Revolving
Committed Amount) in Dollars in Federal or other immediately available funds.
Such payment from the Revolving Lender shall be due (i) at or before 1:00 P.M.
(Chicago time) on the date the Administrative Agent so notifies a Revolving
Lender, if such notice is given at or before 10:00 A.M. (Chicago time) on such
date or (ii) at or before 10:00 A.M. (Chicago time) on the next succeeding
Business Day, together with interest on such amount for each day from and
including the date of such drawing to but excluding the day such payment is due
from such Revolving Lender at the Federal Funds Rate for such day (which funds,
in the case of a failure to reimburse an Issuing Lender under an Existing Letter
of Credit, the Administrative Agent shall promptly remit to the applicable
Issuing Lender). The failure of any Revolving Lender to make available to the
Administrative Agent its pro-rata share of any unreimbursed LC Disbursement
shall not relieve any other Revolving Lender of its obligation hereunder to make
available to the Administrative Agent its pro-rata share of any payment made
under any Letter of Credit or LC Support Agreement (as applicable) on the date
required, as specified above, but no such Lender shall be responsible for the
failure of any other Lender to make available to the Administrative Agent such
other Lender's pro-rata share of any such payment. Upon payment in full of all
amounts payable by a Lender under this subsection (h), such Lender shall be
subrogated to the rights of the Issuing Lender or the Administrative Agent as
applicable against the Borrower to the extent of such Lender's pro-rata share of
the related LC Obligation so paid (including interest accrued thereon). If any
Revolving Lender fails to pay any amount required to be paid by it
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pursuant to this subsection (h) on the date on which such payment is due,
interest shall accrue on such Lender's obligation to make such payment, for each
day from and including the date such payment became due to but excluding the
date such Lender makes such payment, whether before or after judgment, at a rate
per annum equal to (i) for each day from the date such payment is due to the
third succeeding Business Day, inclusive, the Federal Funds Rate for such day as
determined by the relevant Issuing Lender and (ii) for each day thereafter, the
sum of 2.00% plus the rate applicable to its Revolving Base Rate Loans for such
day. Any payment made by any Lender after 3:00 P.M. on any Business Day shall be
deemed for purposes of the preceding sentence to have been made on the next
succeeding Business Day.
(i) Obligations in Respect of Letters of Credit Unconditional. The
obligations of the Borrower under Section 2.05(g) above shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement, under all circumstances whatsoever, including,
without limitation, the following circumstances:
(i) any lack of validity or enforceability of this Agreement
any LC Support Agreement, or any Letter of Credit or any document related
hereto or thereto;
(ii) any amendment or waiver of or any consent to departure
from all or any of the provisions of this Agreement, any LC Support
Agreement, or any Letter of Credit or any document related hereto or
thereto, in each case consented to by the Borrower;
(iii) the use which may be made of the Letter of Credit by, or
any acts or omission of, a beneficiary of a Letter of Credit (or any
Person for whom the beneficiary may be acting);
(iv) the existence of any claim, set-off, defense or other
rights that the Borrower may have at any time against a beneficiary of a
Letter of Credit (or any Person for whom the beneficiary may be acting),
the Administrative Agent, any Issuing Lender or any other Person, whether
in connection with this Agreement, any LC Support Agreement or any Letter
of Credit or any document related hereto or thereto or any unrelated
transaction;
(v) any statement or any other document presented under an
LC Support Agreement or 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 whatsoever;
(vi) payment under a Letter of Credit against presentation to
an Issuing Lender of a draft or certificate that does not comply with the
terms of such Letter of Credit; provided that the relevant Issuing
Lender's determination that documents presented under such Letter of
Credit comply with the terms thereof shall not have constituted gross
negligence or willful misconduct of such Issuing Lender; or
(vii) any other act or omission to act or delay of any kind by
the Administrative Agent, any Issuing Lender or any other Person or any
other event or circumstance whatsoever that might, but for the provisions
of this subsection (vii), constitute a legal or equitable discharge of the
Borrower's obligations hereunder.
(j) Designation of Subsidiaries as Account Parties.
Notwithstanding anything to the contrary set forth in this Agreement, an LC
Support Agreement or Letter of Credit issued hereunder may contain a statement
to the effect that such Letter of Credit is issued for the account of a
Subsidiary of the Borrower; provided that notwithstanding such statement, the
Borrower shall be the actual account party
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for all purposes of this Agreement for such Letter of Credit and such statement
shall not affect the Borrower's reimbursement obligations hereunder with respect
to such Letter of Credit.
(k) Modification and Extension. The issuance of any supplement,
restatement, modification, amendment, renewal, or extensions to any LC Support
Agreement or Letter of Credit shall, for purposes hereof, be treated in all
respects the same as a Credit Extension hereunder.
(l) Uniform Customs and Practices. Unless otherwise expressly
agreed by the Administrative Agent and the Borrower when an LC Support Agreement
is issued in support of a Letter of Credit (including any such agreement
applicable to an Existing Letter of Credit), (i) the rules of the "International
Standby Practices 1998" published by the Institute of International Banking Law
& Practice (or such later version thereof as may be in effect at the time of
issuance) shall apply to each Standby Letter of Credit, and (ii) the rules of
the Uniform Customs and Practice for Documentary Credits, as most recently
published by the International Chamber of Commerce (the "ICC") at the time of
issuance (including the ICC decision published by the Commission on Banking
Technique and Practice on April 6, 1998 regarding the European single currency
(euro)) shall apply to each Trade Letter of Credit.
(m) Responsibility of Issuing Lenders. It is expressly understood
and agreed that the obligations of the Issuing Lenders and Administrative Agent
hereunder to the Revolving Lenders are only those expressly set forth in this
Agreement and that each Issuing Lender and the Administrative Agent shall be
entitled to assume that the conditions precedent set forth in Section 4.02 have
been satisfied unless it shall have acquired actual knowledge that any such
condition precedent has not been satisfied; provided, however, that nothing set
forth in this Section 2.05 shall be deemed to prejudice the right of any
Revolving Lender to recover from any Issuing Lender and the Administrative Agent
any amounts made available by such Revolving Lender to such Issuing Lender and
the Administrative Agent pursuant to this Section 2.05 in the event that it is
determined by a court of competent jurisdiction that the payment with respect to
a Letter of Credit or an LC Support Agreement constituted gross negligence or
willful misconduct on the part of the Issuing Lender or Administrative Agent (as
applicable).
(n) Conflict with LC Documents. In the event of any conflict
between this Agreement and any LC Document, this Agreement shall govern.
(o) Indemnification of Issuing Lenders and the Administrative
Agent.
(i) In addition to its other obligations under this
Agreement, the Borrower hereby agrees to protect, indemnify, pay and save
the Administrative Agent and each Issuing Lender harmless from and against
any and all claims, demands, liabilities, damages, losses, costs, charges
and expenses (including reasonable attorneys' fees) that the
Administrative Agent and Issuing Lender may incur or be subject to as a
consequence, direct or indirect, of (A) the issuance of any LC Support
Agreement or Letter of Credit as applicable or (B) the failure of the
Administrative Agent or such Issuing Lender to honor a drawing under an LC
Support Agreement or Letter of Credit as a result of any act or omission,
whether rightful or wrongful, of any present or future de jure or de facto
government or Governmental Authority (all such acts or omissions, herein
called "Government Acts").
(ii) As between the Borrower and the Administrative Agent or
each Issuing Lender, the Borrower shall assume all risks of the acts or
omissions of or the misuse of any Letter of Credit by the beneficiary
thereof. The Administrative Agent or Issuing Lender shall not be
responsible for: (A) the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in
connection with the application for and issuance of any LC Support
Agreement or Letter of Credit, even if it should in fact prove to be in
any or all respects
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invalid, insufficient, inaccurate, fraudulent or forged; (B) the validity
or sufficiency of any instrument transferring or assigning or purporting
to transfer or assign any Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, that may prove to be
invalid or ineffective for any reason; (C) failure of the beneficiary of a
Letter of Credit to comply fully with conditions required in order to draw
upon a Letter of Credit; (D) errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable, telegraph, telex
or otherwise, whether or not they be in cipher; (E) errors in
interpretation of technical terms; (F) any loss or delay in the
transmission or otherwise of any documents required in order to make a
drawing under a Letter of Credit or of the proceeds thereof; and (G) any
consequences arising from causes beyond the control of the Administrative
Agent or Issuing Lender, including, without limitation, any Government
Acts. None of the above shall affect, impair, or prevent the vesting of
the Administrative Agent or Issuing Lender's rights or powers hereunder.
(iii) In furtherance and extension and not in limitation of
the specific provisions hereinabove set forth, any action taken or omitted
by the Administrative Agent or an Issuing Lender, under or in connection
with any LC Support Agreement or Letter of Credit or the related
certificates, if taken or omitted in good faith, shall not put the
Administrative Agent or Issuing Lender under any resulting liability to
the Borrower or any other Credit Party other than for gross negligence,
bad faith or willful misconduct. It is the intention of the parties that
this Agreement shall be construed and applied to protect and indemnify the
Administrative Agent or Issuing Lenders against any and all risks involved
in the issuance of any LC Support Agreement or Letter of Credit, all of
which risks are hereby assumed by the Credit Parties, including, without
limitation, any and all risks, whether rightful or wrongful, of any
present or future Government Acts. The Administrative Agent or Issuing
Lenders shall not, in any way, be liable for any failure by the
Administrative Agent or Issuing Lenders or anyone else to pay any drawing
under any LC Support Agreement or Letter of Credit as a result of any
Government Acts or any other cause beyond the control of the Issuing
Lenders.
(iv) Nothing in this subsection (o) is intended to limit the
reimbursement obligation of the Borrower contained in this Section 2.05.
The obligations of the Borrower under this subsection (o) shall survive
the termination of this Agreement. No act or omission of any current or
prior beneficiary of a Letter of Credit shall in any way affect or impair
the rights of the Administrative Agent or any Issuing Lender to enforce
any right, power or benefit under this Agreement.
(v) Notwithstanding anything to the contrary contained in
this subsection (o), the Borrower shall not have any obligation to
indemnify the Administrative Agent or any Issuing Lender in respect of any
liability to the extent incurred by the Administrative Agent or such
Issuing Lender arising solely out of the gross negligence, bad faith, or
willful misconduct of the Administrative Agent or Issuing Lender,
respectively, as determined by a court of competent jurisdiction. Nothing
in this Agreement shall relieve Administrative Agent or any Issuing Lender
of any liability to the Borrower in respect of any action taken by the
Administrative Agent or such Issuing Lender which action constitutes gross
negligence, bad faith or willful misconduct of the Administrative Agent or
such Issuing Lender or a violation of the UCP or Uniform Commercial Code,
as applicable, as determined by a court of competent jurisdiction.
(p) Cash Collateral. If the Borrower is required pursuant to the
terms of this Agreement to Cash Collateralize any LC Obligations, the Borrower
shall deposit in an account (which may be an LC Cash Collateral Account under
the Security Agreement) with the Collateral Agent an amount in Dollars in cash
equal to 105% of such LC Obligations. Such deposit shall be held by the
Collateral Agent as collateral for the payment and performance of the LC
Obligations. The Collateral
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s
Agent shall have exclusive control, including the exclusive right of withdrawal,
over each collateral account referred to in this subsection (p). The Collateral
Agent will, at the request of the Borrower, invest amounts deposited in such
account in Cash Equivalents; provided, however, that (i) the Collateral Agent
shall not be required to make any investment that, in its sole judgment, would
require or cause the Collateral Agent to be in, or would result in any,
violation of any Law, (ii) such Cash Equivalents shall be subjected to a first
priority perfected security interest in favor of the Collateral Agent and (iii)
if an Event of Default shall have occurred and be continuing, the selection of
such Cash Equivalents shall be in the sole discretion of the Collateral Agent.
The Borrower shall indemnify the Collateral Agent for any losses relating to
such investments in Cash Equivalents. Other than any interest or profits earned
on such investments, 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 Collateral Agent to reimburse the Issuing
Lenders immediately for drawings under the applicable Letters of Credit and
reimburse the Administrative Agent immediately for payments under the applicable
LC Support Agreement and, if the maturity of the Loans has been accelerated, to
satisfy the LC Obligations of the Borrower. If the Borrower is required to
provide an amount of cash collateral hereunder as a result of an Event of
Default, such amount together with any interest or profits earned thereon (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. If
the Borrower is required to provide an amount of cash collateral hereunder
pursuant to Section 2.08(a) or 2.09(b)(i), such amount together with any
interest or profits earned thereon (to the extent not applied as aforesaid)
shall be returned to the Borrower upon demand; provided that, after giving
effect to the return, (i) the aggregate Revolving Outstandings would not exceed
the Revolving Committed Amount and (ii) no Default or Event of Default shall
have occurred and be continuing. If the Borrower is required to deposit an
amount of cash collateral hereunder pursuant to Section 2.09(b) (iii), (iv),
(v), (vi), or (vii), interest or profits thereon (to the extent not applied as
aforesaid) shall be returned to the Borrower after the full amount of such
deposit has been applied by the Collateral Agent to reimburse the Issuing Lender
for drawings under Letters of Credit and the Administrative Agent for payments
under LC Support Agreements. The Borrower hereby pledges and assigns to the
Collateral Agent, for its benefit and the benefit of the Finance Parties, each
cash collateral account established by it hereunder (and all monies and
investments held therein) to secure its Finance Obligations.
(q) Resignation or Removal of an Issuing Lender. An Issuing Lender
may resign at any time by giving 60 days' notice to the Administrative Agent,
the Revolving Lenders and the Borrower; provided, however, that such resignation
shall not affect the status of any outstanding Letters of Credit issued by such
resigning Issuing Lender as set forth in subsection (r) below. Upon any such
resignation, the Borrower shall (within 60 days after such notice of
resignation) either appoint a successor, or terminate the unutilized LC
Commitment of such Issuing Lender; provided, however, that, if the Borrower
elects to terminate such unutilized LC Commitment, the Borrower may at any time
thereafter that the Revolving Commitments are in effect reinstate such LC
Commitment in connection with the appointment of another Issuing Lender. Subject
to subsection (r) below, upon the acceptance of any appointment as an Issuing
Lender hereunder by a successor Issuing Lender, such successor shall succeed to
and become vested with all the interests, rights and obligations of the retiring
Issuing Lender and the retiring Issuing Lender shall be discharged from its
obligations to issue Additional Letters of Credit hereunder. The acceptance of
any appointment as Issuing Lender hereunder by a successor Issuing Lender shall
be evidenced by an agreement entered into by such successor, in a form
reasonably satisfactory to the Borrower and the Administrative Agent, and, from
and after the effective date of such agreement, (i) such successor shall be a
party hereto and have all the rights and obligations of an Issuing Lender under
this Agreement and the other Senior Finance Documents, and (ii) references
herein and in the other Senior Finance Documents to the "Issuing Lender" shall
be deemed to refer to such successor or to any previous Issuing Lender, or to
such successor and all previous Issuing Lenders, as the context shall require.
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(r) Rights with Respect to Outstanding Letters of Credit. After
the resignation of an Issuing Lender hereunder the retiring Issuing Lender shall
remain a party hereto and shall continue to have all the rights and obligations
of an Issuing Lender under this Agreement and the other Senior Finance Documents
with respect to Letters of Credit issued by it prior to such resignation, but
shall not be required to issue Additional Letters of Credit.
(s) Reporting. Each Issuing Lender will report in writing to the
Administrative Agent (i) on the first Business Day of each week, the aggregate
amount of the face amount of Letters of Credit issued by it and outstanding as
of the last Business Day of the preceding week, (ii) on or prior to each
Business Day on which such Issuing Lender expects to issue, amend, renew or
extend any Letter of Credit, the date of such issuance or amendment, and the
aggregate amount of the face amount of Letters of Credit to be issued, amended,
renewed or extended by it and outstanding after giving effect to such issuance,
amendment, renewal or extension (and such Issuing Lender shall advise the
Administrative Agent on such Business Day whether such issuance, amendment,
renewal or extension occurred and whether the amount thereof changed), (iii) on
each Business Day on which such Issuing Lender makes any LC Disbursement, the
date of such LC Disbursement and the amount of such LC Disbursement and (iv) on
any Business Day on which the Borrower fails to reimburse an LC Disbursement
required to be reimbursed to such Issuing Lender on such day, the date of such
failure, the Borrower and the amount, of such LC Disbursement.
SECTION 2.06 INTEREST.
(a) Rate Options Applicable to Loans. Each Borrowing made prior to
the Syndication Date shall be comprised of Base Rate Loans or (except in the
case of Swingline Loans, which shall be made and maintained as Base Rate Loans)
Eurodollar Loans with a one-month Interest Period (ending on the same date), as
the Borrower may request pursuant to Section 2.02. Each Borrowing made on or
after the Syndication Date shall be comprised of Base Rate Loans or (except in
the case of Swingline Loans, which shall be made and maintained as Base Rate
Loans) Eurodollar Loans, as the Borrower may request pursuant to Section 2.02.
Borrowings of more than one Type may be outstanding at the same time; provided,
however, that the Borrower may not request any Borrowing that, if made, would
result in an aggregate of more than 15 separate Groups of Eurodollar Loans being
outstanding hereunder at any one time. For this purpose, Loans having different
Interest Periods, regardless of whether commencing on the same date, shall be
considered separate Groups.
(b) Base Rate Loans. Each Loan of a Class which is made as, or
converted into, a Base Rate Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is made as, or
converted into, a Base Rate Loan until it becomes due or is converted into a
Loan of any other Type, at a rate per annum equal to the Base Rate for such day
plus the then Applicable Margin. Such interest shall be payable in arrears on
each Interest Payment Date and, with respect to the principal amount of any Base
Rate Loan converted to a Eurodollar Loan, on the date such Base Rate Loan is so
converted.
(c) Eurodollar Loans. Each Eurodollar Loan of a Class shall bear
interest on the outstanding principal amount thereof, for each day during the
Interest Period applicable thereto, at a rate per annum equal to the sum of the
applicable Adjusted London Interbank Offered Rate for such Interest Period plus
the then Applicable Margin. Such interest shall be payable for each Interest
Period on each Interest Payment Date.
(d) Determination and Notice of Interest Rates. The Administrative
Agent shall determine each interest rate applicable to the Loans hereunder. The
Administrative Agent shall give prompt notice to the Borrower and the
participating Lenders of each rate of interest so determined, and its
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determination thereof shall be conclusive in the absence of manifest error. Any
such notice shall, without the necessity of the Administrative Agent so stating
in such notice, be subject to the provisions of the definition of "Applicable
Margin" providing for adjustments in the Applicable Margin from time to time.
When during an Interest Period any event occurs that causes an adjustment in the
Applicable Margin applicable to Loans to which such Interest Period is
applicable, the Administrative Agent shall give prompt notice to the Borrower
and the Lenders of such event and the adjusted rate of interest so determined
for such Loans, and its determination thereof shall be conclusive in the absence
of manifest error.
(e) Default Interest. Upon the occurrence and during the
continuance of an Event of Default under Section 8.01(a) and/or (f), the overdue
principal of and, to the extent permitted by law, overdue interest on the Loans
and any other overdue amounts owing herein or under the other Senior Finance
Documents shall bear interest, payable on demand, at a per annum rate equal to
(i) in the case of principal of any Loan, the rate otherwise applicable to such
Loan during such period pursuant to this Section 2.06 plus 2.00%, (ii) in the
case of interest on any Loan the Base Rate plus the Applicable Margin for Loans
of such Class on such day plus 2.00% and (iii) in the case of any other amount,
if expressly provided for herein, at the rate so provided and otherwise at the
Base Rate plus the Applicable Margin for Revolving Base Rate Loans plus 2.00%.
SECTION 2.07 EXTENSION AND CONVERSION.
(a) Continuation and Conversion Options. The Loans included in
each Borrowing shall bear interest initially at the type of rate allowed by
Section 2.06 and as specified by the Borrower in the applicable Notice of
Borrowing. Thereafter, the Borrower shall have the option to elect to change or
continue the type of interest rate borne by each Group of Loans (subject in each
case to the provisions of Article III and subsection 2.07(d)), as follows:
(i) if such Loans are Base Rate Loans, the Borrower may
elect pursuant to a Notice of Extension/Conversion to convert such Loans
to Eurodollar Loans as of any Business Day; and
(ii) if such Loans are Eurodollar Loans, the Borrower may
elect to convert such Loans to Base Rate Loans or elect to continue such
Loans as Eurodollar Loans for an additional Interest Period, subject to
Section 3.05 in the case of any such conversion or continuation effective
on any day other than the last day of the then current Interest Period
applicable to such Loans.
Each such election shall be made by delivering a notice, substantially in the
form of Exhibit A-2 hereto (a "Notice of Extension/Conversion") or by telephone
promptly confirmed by a Notice of Extension/Conversion, which notice shall not
thereafter be revocable by the Borrower, to the Administrative Agent not later
than 12:00 Noon on the second Business Day before the conversion or continuation
selected in such notice is to be effective. A Notice of Extension/Conversion
may, if it so specifies, apply to only a portion of the aggregate principal
amount of the relevant Group of Loans; provided that (i) such portion is
allocated ratably among the Loans comprising such Group and (ii) the portion to
which such Notice applies, and the remaining portion to which it does not apply,
are each $1,000,000 or any larger multiple of $100,000.
(b) Contents of Notice of Extension/Conversion. Each Notice of
Extension/Conversion shall specify:
(i) the Group of Loans (or portion thereof) to which such
notice applies;
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(ii) the date on which the conversion or continuation
selected in such notice is to be effective, which shall comply with the
applicable clause of subsection 2.07(a) above;
(iii) if the Loans comprising such Group are to be converted,
the new Type of Loans and, if the Loans being converted are to be
Eurodollar Loans, the duration of the next succeeding Interest Period
applicable thereto; and
(iv) if such Loans are to be continued as Eurodollar Loans
for an additional Interest Period, the duration of such additional
Interest Period.
Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definitions of the term "Interest Period". If
no Notice of Extension/Conversion is timely received prior to the end of an
Interest Period for any Group of Eurodollar Loans, the Borrower shall be deemed
to have elected that such Group be converted to Base Rate Loans as of the last
day of such Interest Period.
(c) Notification to Lenders. Upon receipt of a Notice of
Extension/Conversion (written or telephonic as set forth above) from the
Borrower pursuant to subsection 2.07(a) above, the Administrative Agent shall
promptly notify each Lender of the contents thereof.
(d) Limitation on Conversion/Continuation Options. The Borrower
shall not be entitled to elect to convert any Loans to, or continue any Loans
for an additional Interest Period as, Eurodollar Loans if (i) the aggregate
principal amount of any Group of Eurodollar Loans created or continued as a
result of such election would be less than $1,000,000 or (ii) an Event of
Default shall have occurred and be continuing when the Borrower delivers notice
of such election to the Administrative Agent. The Borrower shall not be entitled
to elect to continue any Eurodollar Loans for an Interest Period in excess of
one month, if a Default shall have occurred and be continuing when the Borrower
delivers notice of such election to the Administrative Agent.
(e) Accrued Interest. Accrued interest on a Loan (or portion
thereof) being extended or converted shall be paid by the Borrower (i) with
respect to any Base Rate Loan being converted to a Eurodollar Loan, on the last
day of the first fiscal quarter of the Borrower ending on or after the date of
conversion and (ii) otherwise, on the date of extension or conversion.
SECTION 2.08 MATURITY OF LOANS.
(a) Maturity of Revolving Loans. The Revolving Loans shall mature
on the Revolving Termination Date, and any Revolving Loans, Swingline Loans and
LC Obligations then outstanding (together with accrued interest thereon and fees
in respect thereof) shall be due and payable on such date.
(b) Scheduled Amortization of Term B Loan. The Borrower shall
repay, and there shall become due and payable (together with accrued interest
thereon) on each Principal Amortization Payment Date, (i) 1/4 of 1% of the
aggregate initial principal amount of the Term B Loan, in the case of each of
the first 24 Principal Amortization Payment Dates and (ii) thereafter, 23.5% of
the aggregate initial principal amount of the Term B Loan, in the case of the
four final Principal Amortization Dates, and in each case the Term B Loans of
each class of each Lender shall be ratably repaid.
SECTION 2.09 PREPAYMENTS.
(a) Voluntary Prepayments. The Borrower shall have the right
voluntarily to prepay Loans in whole or in part from time to time, subject to
Section 3.05 but otherwise without premium or
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penalty; provided, however, that (i) each partial prepayment of Loans of any
Class shall be in a minimum principal amount of $1,000,000 and integral
multiples of $100,000 in excess thereof, (ii) the Borrower shall have given
prior written or telecopy notice (or telephone notice promptly confirmed by
written or telecopy notice) to the Administrative Agent, (A) in the case of any
Revolving Loan which is a Base Rate Loan or any Swingline Loan, by 12 Noon on
the date of prepayment and (B), in the case of any other Loan, by 12 Noon at
least two Business Days prior to the date of prepayment and (iii) voluntary
prepayments of Term Loans under this Section 2.09(a) shall be applied ratably to
the remaining Principal Amortization Payments thereof. Each notice of prepayment
shall specify the prepayment date, the principal amount remaining and amount to
be prepaid, whether the Loan to be prepaid is a Revolving Loan, Term B Loan or
Swingline Loan, whether the Loan to be prepaid is a Eurodollar Loan or a Base
Rate Loan and, in the case of a Eurodollar Loan, the Interest Period of such
Loan. Each notice of prepayment shall be irrevocable and shall commit the
Borrower to prepay such Loan by the amount, and on the date stated therein.
Subject to the foregoing, amounts prepaid under this Section 2.09(a) shall be
applied as the Borrower may elect; provided that if the Borrower fails to
specify the application of a voluntary prepayment, then such prepayment shall be
applied first to Revolving Loans to the full extent thereof (without a permanent
reduction in the Revolving Committed Amount), then to Swingline Loans to the
full extent thereof (without a permanent reduction in the Revolving Committed
Amount), then to Term B Loans (ratably to the remaining Principal Amortization
Payments thereof), in each case first to Base Rate Loans and then to Eurodollar
Loans of the applicable Class in direct order of Interest Period maturity. All
prepayments under this Section 2.09(a) shall be accompanied by accrued interest
on the principal amount being prepaid to the date of payment. Notwithstanding
the foregoing, the Borrower may elect to cause all or a portion of any such
prepayment of Term B Loans to be applied to the remaining Principal Amortization
Payments thereof in direct order of maturity.
(b) Mandatory Prepayments.
(i) Revolving Committed Amount. If on any date the aggregate
Revolving Outstandings exceed the Revolving Committed Amount, the Borrower
shall repay, and there shall become due and payable (together with accrued
interest thereon), on such date an aggregate principal amount of Swingline
Loans equal to such excess. If the outstanding Swingline Loans have been
repaid in full, the Borrower shall prepay, and there shall become due and
payable (together with accrued interest thereon), Revolving Loans in such
amounts as are necessary so that, after giving effect to the repayment of
the Swingline Loans and the repayment of Revolving Loans, the aggregate
Revolving Outstandings do not exceed the Revolving Committed Amount. If
the outstanding Revolving Loans and Swingline Loans have been repaid in
full, the Borrower shall Cash Collateralize LC Obligations so that, after
giving effect to the repayment of Swingline Loans and Revolving Loans and
the Cash Collateralization of LC Obligations pursuant to this subsection
(i), the aggregate Revolving Outstandings do not exceed the Revolving
Committed Amount. In determining the aggregate Revolving Outstandings for
purposes of this subsection (i), LC Obligations shall be reduced to the
extent that they are Cash Collateralized as contemplated by this
subsection (i). Each prepayment of Revolving Loans required pursuant to
this subsection (i) shall be applied ratably among outstanding Revolving
Loans based on the respective amounts of principal then outstanding. Each
Cash Collateralization of LC Obligations required by this subsection (i)
shall be applied ratably among LC Obligations based on the respective
amounts thereof then outstanding.
(ii) Excess Cash Flow. Within 120 days after the end of each
fiscal year of the Borrower (commencing with the fiscal year ending
December 31, 2004, but with respect to such year, from the Closing Date
only), the Borrower shall prepay the Loans and/or Cash Collateralize or
pay the LC Obligations in an aggregate amount equal to (A) 75% of the
Excess Cash Flow for such prior fiscal year if the Leverage Ratio as of
the last day of such prior fiscal
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year was equal to or greater than 3.0 to 1.0, (B) 50% of the Excess Cash
Flow for such prior fiscal year, if the Leverage Ratio as of the last day
of such prior fiscal year was less than 3.0 to 1.0 but equal to or greater
than 2.0 to 1.0 or (C) 25% of the Excess Cash Flow for the prior fiscal
year, if the Leverage Ratio as of the last day of such prior fiscal year
was less than 2.0 to 1.0. Notwithstanding the foregoing, if on the date of
such prepayment, a payment in respect of the Junior Debentures would not
be permitted pursuant to Section 7.08 (d) below, the Borrower shall prepay
the Loans and/or Cash Collateralize or pay the LC Obligations in an
aggregate amount equal to 75% of the Excess Cash Flow for such prior
fiscal year.
(iii) Asset Dispositions, Casualties and Condemnations, etc.
Within five Business Days after receipt by any Group Company of proceeds
from any Asset Disposition (other than any Excluded Asset Disposition),
Casualty or Condemnation, the Borrower shall prepay the Loans and/or Cash
Collateralize or pay the LC Obligations in an aggregate amount equal to
100% of the Net Cash Proceeds of such Asset Disposition, Casualty or
Condemnation, as applicable
(iv) Debt Issuances. Within five Business Days after receipt
by any Group Company of proceeds from any Debt Issuance (other than such
Debt Issuance permitted pursuant to Section 7.01 of this Agreement), the
Borrower shall prepay the Loans and/or Cash Collateralize the LC
Obligations in an aggregate amount equal to 100% of the Net Cash Proceeds
of such Debt Issuance.
(v) Equity Issuances. Within five Business Days after
receipt by any Group Company of proceeds from any Equity Issuance (other
than any Excluded Equity Issuance), the Borrower shall prepay the Loans
and/or Cash Collateralize the LC Obligations in an aggregate amount equal
to (A) 75% of the Net Cash Proceeds of such Equity Issuance if the
Leverage Ratio as of the last day of the fiscal quarter on a Pro-Forma
Basis (as confirmed by the delivery of the Pro-Forma Compliance
Certificate) of the Borrower ending on or most recently preceding the date
of the receipt of such proceeds was equal to or greater than 3.5 to 1.0,
(B) 50% of the Net Cash Proceeds of such Equity Issuance, if the Leverage
Ratio as of the last day of the fiscal quarter on a Pro-Forma Basis (as
confirmed by the delivery of the Pro-Forma Compliance Certificate) of the
Borrower ending on or most recently preceding the date of the receipt of
such proceeds was less than 3.5 to 1.0 but equal to or greater than 2.5 to
1.0, and (C) 25% of the Net Cash Proceeds of such Equity Issuance, if the
Leverage Ratio as of the last day of the fiscal year of the Borrower
ending on or most recently preceding the date of the receipt of such
proceeds was less than 2.5 to 1.0, and in each case, Holdings shall have
delivered to the Administrative Agent a Pro-Forma Compliance Certificate
in connection therewith.
(vi) Payments in Respect of Subordinated Debt. Immediately
upon receipt by the Administrative Agent or any Lender of any amount
pursuant to the subordination provision of any Debt of Holdings or any of
its Subsidiaries that is subordinate to the Senior Obligations, all
proceeds thereof shall be applied as set forth in subsection (vii)(B)
below.
(vii) Application of Mandatory Prepayments. All amounts
required to be paid pursuant to this Section 2.09(b) shall be applied as
follows:
(A) with respect to all amounts paid pursuant to
Section 2.09(b)(i) in the order provided in such Section; and
(B) with respect to all amounts paid pursuant to
Section 2.09(b)(ii), (iii), (iv), (v) or (vi) (1) first, to the Term
B Loans (ratably to the remaining Principal
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Amortization Payments thereof, provided that the Borrower may elect
to cause all or a portion of such prepayment of Term B Loans to be
applied to the remaining Principal Amortization Payments thereof in
direct order of maturity, due in the twelve month period commencing
on the date of prepayment) and (2) second, (x) to the Revolving
Loans (with a corresponding reduction in the Revolving Committed
Amount pursuant to Section 2.10(b)), (y) then to Swingline Loans
(with a corresponding reduction in the Revolving Committed Amount
and the Swingline Committed Amount pursuant to Section 2.10(b)), and
(z) then to Cash Collateralize LC Obligations.
(viii) Order of Applications. All amounts allocated to
Revolving Outstandings as provided in this Section 2.09(b) shall be
applied, first, to Swingline Loans, second, after all Swingline Loans have
been repaid, to Revolving Loans, and third, after all Revolving Loans have
been repaid, to Cash Collateralize or pay the LC Obligations; provided
that any balance of such amounts remaining after all Revolving Loans have
been repaid and, if applicable, all LC Obligations have been Cash
Collateralized shall be applied to the Term B Loans in each case ratably
to the remaining Principal Amortization Payments thereof. Within the
parameters of the applications set forth above, prepayments of Revolving
Loans and Term B Loans shall be applied first to Base Rate Loans and then,
subject to subsection (ix) below, to Eurodollar Loans in direct order of
Interest Period maturities. All prepayments under this Section 2.09(b)
shall be subject to Section 3.05. All prepayments under this Section
2.09(b) shall be accompanied by accrued interest on the principal amount
being prepaid to the date of payment.
(ix) Prepayment Accounts. Amounts to be applied as provided
in subsection (vii) above to the prepayment of Revolving Loans or Term B
Loans shall be applied first to reduce outstanding Base Rate Loans of such
Class. Any amounts remaining after each such application shall, at the
option of the Borrower, be applied to prepay Eurodollar Loans of such
Class immediately and/or shall be deposited in a separate Prepayment
Account (as defined below) for the Loans of such Class. The Administrative
Agent shall apply any cash deposited in the Prepayment Account for any
Class of Loans, upon withdrawal by the Collateral Agent, to prepay
Eurodollar Loans of such Class on the last day of their respective
Interest Periods (or, at the direction of the Borrower, on any earlier
date) until all outstanding Loans of such Class have been prepaid or until
all the allocable cash on deposit in the Prepayment Account for such Class
has been exhausted. Concurrently with such application, the aggregate
amount of any interest or profits earned on the amount so applied shall be
withdrawn by the Collateral Agent and paid to the order of the Borrower.
For purposes of this Agreement, the term "Prepayment Account" for any
Class of Loans shall mean an account (which may include the Prepayment
Account established under the Security Agreement) established by the
Borrower with the Collateral Agent and over which the Collateral Agent
shall have exclusive dominion and control, including the exclusive right
of withdrawal for application in accordance with this subsection (ix). The
Collateral Agent will, at the request of the Borrower, invest amounts on
deposit in the Prepayment Account for any Class of Loans in Cash
Equivalents that mature prior to the last day of the applicable Interest
Periods of the Eurodollar Loans of such Class to be prepaid; provided,
however, that (i) the Collateral Agent shall not be required to make any
investment that, in its sole judgment, would require or cause the
Collateral Agent to be in, or would result in any, violation of any Law,
(ii) such Cash Equivalents shall be subjected to a first priority
perfected security interest in favor of the Collateral Agent and (iii) if
any Event of Default shall have occurred and be continuing, the selection
of such Cash Equivalents shall be in the sole discretion of the Collateral
Agent. The Borrower shall indemnify the Collateral Agent for any losses
relating to such investments in Cash Equivalents so that the amount
available to prepay Eurodollar Loans on the last day of the applicable
Interest Periods is not less than the amount that would have been
available had no investments been made pursuant thereto. Other than any
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interest or profits earned on such investments, the Prepayment Accounts
shall not bear interest. Interest or profits, if any, on the investments
in any Prepayment Account shall accumulate in such Prepayment Account and
be paid to the Borrower as provided above. If the maturity of the Loans
has been accelerated pursuant to Section 8.02, the Administrative Agent
may, in its sole discretion, cause the Collateral Agent to withdraw
amounts on deposit in the Prepayment Account for any Class of Loans and
apply such funds to satisfy any of the Senior Obligations related to such
Class of Loans.
(x) Payments Cumulative. Except as otherwise expressly
provided in this Section 2.09, payments required under any subsection or
clause of this Section 2.09 are in addition to payments made or required
under any other subsection or clause of this Section 2.09.
(xi) Notice. The Borrower shall give to the Administrative
Agent and the Lenders at least five Business Days' prior written or
telecopy notice of each and every event or occurrence requiring a
prepayment under Section 2.09(b)(iii), (iv), (v) or (vi), including the
amount of Net Cash Proceeds expected to be received therefrom and the
expected schedule for receiving such proceeds; provided, however, that in
the case of any prepayment event consisting of a Casualty or Condemnation,
the Borrower shall give such notice within five Business Days after the
occurrence of such event.
SECTION 2.10 ADJUSTMENT OF COMMITMENTS.
(a) Optional Termination or Reduction of Commitments (Pro-Rata).
The Borrower may from time to time permanently reduce or terminate the Revolving
Committed Amount in whole or in part (in minimum aggregate amounts of $1,000,000
or in integral multiples of $100,000 in excess thereof (or, if less, the full
remaining amount of the then applicable Revolving Committed Amount)) upon two
Business Days' prior written or telecopy notice to the Administrative Agent;
provided, however, that no such termination or reduction shall be made which
would cause the Revolving Outstandings to exceed the Revolving Committed Amount
as so reduced unless, concurrently with such termination or reduction, the
Revolving Loans are repaid or, if no Revolving Loans are outstanding, the
Swingline Loans are repaid and, after the Swingline Loans have been paid in
full, the LC Obligations are Cash Collateralized to the extent necessary to
eliminate such excess. The Administrative Agent shall promptly notify each
affected Lender of the receipt by the Administrative Agent of any notice from
the Borrower pursuant to this Section 2.10(a). Any partial reduction of the
Revolving Committed Amount pursuant to this Section 2.10(a) shall be applied to
the Revolving Commitments of the Lenders of the applicable Class pro-rata based
upon their respective Revolving Commitment Percentages. The Borrower shall pay
to the Administrative Agent for the account of the Lenders in accordance with
the terms of Section 2.11, on the date of each termination or reduction of the
Revolving Committed Amount, any fees accrued through the date of such
termination or reduction on the amount of the Revolving Committed Amount so
terminated or reduced.
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(b) Mandatory Reductions.
On any date that any Revolving Loans are required to be
prepaid, Swingline Loans are required to be prepaid and/or LC Obligations are
required to be Cash Collateralized pursuant to the terms of Section 2.09(b),
(iv), (v) or (vi) (or would be so required if any Revolving Loans, Swingline
Loans or LC Obligations were outstanding), the Revolving Committed Amount shall
be automatically and permanently reduced by the total amount of such required
prepayments and cash collateral (and, in the event that the amount of any
payment referred to in Section 2.09(b), (iv), (v) or (vi) which is allocable to
the Revolving Outstandings exceeds the amount of all outstanding Revolving
Outstandings, the Revolving Committed Amount shall be further reduced by 100% of
such excess).
(c) Termination. The Revolving Commitments of the Lenders and the
LC Commitments of the Issuing Lenders shall terminate automatically on the
Revolving Termination Date. The Swingline Commitment of the Swingline Lender
shall terminate automatically on the Swingline Termination Date. The Term B
Commitments of the Lenders shall terminate automatically immediately after the
making of the Term B Loan on the Closing Date.
(d) Optional Termination of Commitments (Non-Pro-Rata). If (i) any
Lender has demanded compensation or indemnification pursuant to Section 3.01 or
Section 3.04, (ii) the obligation of any Lender to make Eurodollar Loans has
been suspended pursuant to Section 3.02, (iii) any Lender is a Defaulting Lender
or (iv) any Lender has failed to consent to a proposed amendment, waiver,
discharge or termination which pursuant to the terms of Section 10.03 or any
other provision of any Senior Finance Document requires the consent of more than
the Required Lenders and with respect to which the Required Lenders shall have
granted their consent, the Borrower shall have the right, if no Default or Event
of Default then exists, to (i) remove such Lender by terminating such Lender's
Commitment in full or (ii) replace such Lender by causing such Lender to assign
its Commitment to one or more existing Lenders or Eligible Assignees pursuant to
Section 10.06; provided, however, that if the Borrower elects to exercise such
right with respect to any Lender pursuant to clause (i) or (ii) above, it shall
be obligated to remove or replace, as the case may be, all Lenders that have
similar requests then outstanding for compensation pursuant to Section 3.01 or
3.04 or whose obligation to make Eurodollar Loans has been similarly suspended.
The replacement of a Lender pursuant to this Section 2.10(d) shall be effective
on the date of notice of such replacement to the Lenders through the
Administrative Agent (the "Replacement Date"), subject to the satisfaction of
the following conditions:
(i) each replacement Lender and/or Eligible Assignee, and
the Administrative Agent acting on behalf of each Lender subject to
replacement, shall have satisfied the conditions to an Assignment and
Acceptance set forth in Section 10.06(b) and, in connection therewith, the
replacement Lender(s) and/or Eligible Assignee(s) shall pay:
(A) to each Lender subject to replacement an amount
equal in the aggregate to the sum of (x) the principal of, and all
accrued but unpaid interest on, its outstanding Loans, (y) the
amount of all LC Disbursements that have been funded by (and not
reimbursed to) it under Section 2.05, together with all accrued but
unpaid interest with respect thereto, and (z) all accrued but unpaid
fees owing to it pursuant to Section 2.11; and
(B) to the Issuing Lenders an amount equal to the
aggregate amount owing by the replaced Lenders to the Issuing
Lenders as reimbursement pursuant to Section 2.05, to the extent
such amount was not theretofore funded by such replaced Lenders; and
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(ii) the Borrower shall have paid to the Administrative Agent
for the account of each replaced Lender an amount equal to all obligations
owing to such replaced Lenders by the Borrower pursuant to this Agreement
and the other Senior Finance Documents (other than those obligations of
the Borrower referred to in clause (i)(A) above).
In the case of the removal of a Lender pursuant to this Section
2.10(d), upon (i) payment by the Borrower to the Administrative Agent for the
account of the Lender subject to such removal of an amount equal to the sum of
(A) the aggregate principal amount of all Loans and LC Obligations held by such
Lender and (B) all accrued interest, fees and other amounts owing to such Lender
hereunder, including, without limitation, all amounts payable by the Borrower to
such Lender under Article III or Sections 10.04 and 10.05, and (ii) provision by
the Borrower to the Swingline Lender and each Issuing Lender of appropriate
assurances and indemnities (which may include letters of credit) as each may
reasonably require with respect to any continuing obligation of such removed
Lender to purchase Participation Interests in any LC Obligations or Swingline
Loans then outstanding, such Lender shall, without any further consent or other
action by it, cease to constitute a Lender hereunder; provided that the
provisions of this Agreement (including, without limitation, the provisions of
Article III and Sections 10.04 and 10.05) shall continue to govern the rights
and obligations of a removed Lender with respect to any Loans made, any Letters
of Credit issued or any other actions taken by such removed Lender while it was
a Lender.
(e) General. The Borrower shall pay to the Administrative Agent
for the account of the Lenders in accordance with the terms of Section 2.11, on
the date of each termination or reduction of the Revolving Committed Amount, the
Commitment Fee accrued through the date of such termination or reduction on the
amount of the Revolving Committed Amount so terminated or reduced.
SECTION 2.11 FEES.
(a) Commitment Fee. The Borrower shall pay to the Administrative
Agent for the account of each Revolving Lender a fee (the "Commitment Fee") on
such Lender's Revolving Commitment Percentage of the daily Unused Revolving
Committed Amount, computed at a per annum rate for each day equal to 0.50%. The
Commitment Fee shall commence to accrue on the Closing Date and shall be due and
payable in arrears on the last Business Day of each March, June, September and
December (and any date that the Revolving Committed Amount is reduced as
provided in Section 2.10(a) or (b) and the Revolving Termination Date for the
applicable Class) for the quarter or portion thereof ending on each such date,
beginning with the first of such dates to occur after the Closing Date.
(b) Letter of Credit Fees.
(i) Letter of Credit Fee. The Borrower shall pay to the
Administrative Agent for the account of each Revolving Lender a fee (the
"Letter of Credit Fee") on such Lender's Revolving Commitment Percentage
of the average daily maximum amount available to be drawn under each such
Letter of Credit computed at a per annum rate for each day from the date
of issuance to the date of expiration equal to the Applicable Margin for
Letter of Credit Fees in effect from time to time. The Letter of Credit
Fee will be payable quarterly in arrears on the last Business Day of each
March, June, September and December for the immediately preceding quarter
(or portion thereof), beginning with the first of such dates to occur
after the date of issuance of such Letter of Credit, and on the Revolving
Termination Date.
(ii) Fronting Fees. The Borrower shall pay directly to each
Issuing Lender for its own account a fronting fee with respect to each
Letter of Credit, in an amount to be agreed between the Borrower and the
relevant Issuing Lender, such fronting fee to be due and payable
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quarterly in arrears on the last Business Day of each March, June,
September and December, commencing with the first such date after the
issuance of such Letter of Credit, and on the Revolving Termination Date.
(iii) Issuing Lender Fees. In addition to the Letter of Credit
Fee payable pursuant to clause (i) above and any fronting fees payable
pursuant to clause (ii) above, the Borrower promises to pay to the Issuing
Lender for its own account without sharing by the other Lenders the letter
of credit fronting and negotiation fees agreed to by the Borrower and the
Issuing Lender from time to time and the customary charges from time to
time of the Issuing Lender with respect to the issuance, amendment,
transfer, administration, cancellation and conversion of, and drawings
under, each Letter of Credit (collectively, the "Issuing Lender Fees").
(iv) Computation of Certain Fees after Default. Upon the
occurrence and during the continuance of a payment or insolvency Event of
Default under Section 8.01(a) and/or (f) any overdue Letter of Credit Fee
payable under subsection (i) above shall be computed at a rate per annum
equal to the relevant "Applicable Margin for Letter of Credit Fee" as set
forth in the applicable table in the definition of "Applicable Margin" in
Section 1.01 hereof plus 2.00%.
SECTION 2.12 PRO-RATA TREATMENT. Except to the extent otherwise
provided herein:
(a) Loans. Each Borrowing, each payment or prepayment of principal
of or interest on any Loan, each payment of fees (other than the Issuing Lender
Fees retained by an Issuing Lender for its own account and the administrative
fees retained by the Agents for their own account), each reduction of the
Revolving Committed Amount and each conversion or continuation of any Loan,
shall be allocated pro-rata among the relevant Lenders in accordance with the
respective Revolving Commitment Percentages and Term B Commitment Percentages,
as applicable, of such Lenders (or, if the Commitments of such Lenders have
expired or been terminated, in accordance with the respective principal amounts
of the outstanding Loans of the applicable Class and Participation Interests of
such Lenders); provided that, in the event any amount paid to any Lender
pursuant to this subsection (a) is rescinded or must otherwise be returned by
the Administrative Agent, each Lender shall, upon the request of the
Administrative Agent, repay to the Administrative Agent the amount so paid to
such Lender, with interest for the period commencing on the date such payment is
returned by the Administrative Agent until the date the Administrative Agent
receives such repayment at a rate per annum equal to, during the period to but
excluding the date two Business Days after such request, the Federal Funds Rate,
and thereafter, the Base Rate plus 2.00% per annum.
(b) Letters of Credit. Each payment of LC Obligations shall be
allocated to each Revolving Lender pro-rata in accordance with its Revolving
Commitment Percentage; provided that, if any Revolving Lender shall have failed
to pay its applicable pro-rata share of any LC Disbursement, then any amount to
which such Revolving Lender would otherwise be entitled pursuant to this
subsection (b) shall instead be payable to the Issuing Lender; provided,
further, that in the event any amount paid to any Revolving Lender pursuant to
this subsection (b) is rescinded or must otherwise be returned by the Issuing
Lender, each Revolving Lender shall, upon the request of the Issuing Lender,
repay to the Administrative Agent for the account of the Issuing Lender the
amount so paid to such Revolving Lender, with interest for the period commencing
on the date such payment is returned by the Issuing Lender until the date the
Issuing Lender receives such repayment at a rate per annum equal to, during the
period to but excluding the date two Business Days after such request, the
Federal Funds Rate, and thereafter, the Base Rate plus 2.00% per annum.
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SECTION 2.13 SHARING OF PAYMENTS. The Lenders agree among themselves
that, except to the extent otherwise provided herein, if any Lender shall obtain
payment in respect of any Loan, unreimbursed LC Disbursements or any other
obligation owing to such Lender under this Agreement through the exercise of a
right of setoff, banker's lien or counterclaim, or pursuant to a secured claim
under Section 506 of the Bankruptcy Code or other security or interest arising
from, or in lieu of, such secured claim, received by such Lender under any
applicable bankruptcy, insolvency or other similar law or otherwise, or by any
other means, in excess of its pro-rata share of such payment as provided for in
this Agreement, such Lender shall promptly pay in cash or purchase from the
other Lenders a participation in such Loans, unreimbursed LC Disbursements, and
other obligations in such amounts, and make such other adjustments from time to
time, as shall be equitable to the end that all Lenders share such payment in
accordance with their respective ratable shares as provided for in this
Agreement; provided that nothing in this Section 2.13 shall impair the right of
any Lender to exercise any right of set-off or counterclaim it may have for
payment of indebtedness of the Borrower other than its indebtedness hereunder.
The Lenders further agree among themselves that if payment to a Lender obtained
by such Lender through the exercise of a right of setoff, banker's lien,
counterclaim or other event as aforesaid shall be rescinded or must otherwise be
restored, each Lender which shall have shared the benefit of such payment shall,
by payment in cash or a repurchase of a participation theretofore sold, return
its share of that benefit (together with its share of any accrued interest
payable with respect thereto) to each Lender whose payment shall have been
rescinded or otherwise restored. Holdings and the Borrower agree that any Lender
so purchasing such a participation may, to the fullest extent permitted by law,
exercise all rights of payment, including setoff, banker's lien or counterclaim,
with respect to such participation as fully as if such Lender were a holder of
such Loan, LC Obligation or other obligation in the amount of such
participation. If under any applicable bankruptcy, insolvency or other similar
law, any Lender receives a secured claim in lieu of a setoff to which this
Section 2.13 applies, such Lender shall, to the extent practicable, exercise its
rights in respect of such secured claim in a manner consistent with the rights
of the Lenders under this Section 2.13 to share in the benefits of any recovery
on such secured claim.
SECTION 2.14 PAYMENTS; COMPUTATIONS.
(a) Payments by the Borrower. Each payment of principal of and
interest on Loans, LC Obligations and fees hereunder (other than fees payable
directly to the Issuing Lenders) shall be paid not later than 2:00 P.M. on the
date when due, in Federal or other funds immediately available to the
Administrative Agent at the account designated by it by notice to the Borrower.
Each such payment shall be made irrespective of any set-off, counterclaim or
defense to payment which might in the absence of this provision be asserted by
the Borrower or any Affiliate against any Agent or any Lender. Payments received
after 2:00 P.M. shall be deemed to have been received on the next Business Day.
The Borrower shall, at the time it makes any payments under this Agreement,
specify to the Administrative Agent the Loan, Letters of Credit, fees or other
amounts payable by the Borrower hereunder to which such payment is to be applied
(and any such specified application would be inconsistent with the terms hereof,
the Administrative Agent shall, subject to Section 2.12, distribute such payment
to the Lenders in such manner as the Administrative Agent may deem reasonably
appropriate). The Administrative Agent will distribute such payments to the
applicable Lenders on the date of receipt thereof, if such payment is received
prior to 2:00 P.M.; otherwise the Administrative Agent may, in its sole
discretion distribute such payment to the applicable Lenders on the date of
receipt thereof or on the immediately succeeding Business Day. Whenever any
payment hereunder shall be due on a day which is not a Business Day, the date
for payment thereof shall be extended to the next succeeding Business Day unless
such Business Day falls in another calendar month, in which case the date for
payment thereof shall be the next preceding Business Day. If the date for any
payment of principal is extended by operation of law or otherwise, interest
thereon shall be payable for such extended time. The Borrower hereby authorizes
and directs each Agent to debit any account maintained by the Borrower for such
purpose with such Agent to pay
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when due any amounts required to be paid from time to time under this Agreement
as directed at such time(s) by the Borrower.
(b) Distributions by the Administrative Agent. Unless the
Administrative Agent shall have received notice (written or telephonic) from the
Borrower prior to the date on which any payment is due to the Lenders hereunder
that the Borrower will not make such payment in full, the Administrative Agent
may assume that the Borrower has made such payment in full to the Administrative
Agent on such date, and the Administrative Agent may, in reliance upon such
assumption, cause to be distributed to each Lender on such due date an amount
equal to the amount then due such Lender. If and to the extent that the Borrower
shall not have so made such payment, each Lender shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Lender
together with interest thereon, for each day from the date such amount is
distributed to such Lender until the date such Lender repays such amount to the
Administrative Agent, at the Federal Funds Rate.
(c) Computations. Except for interest on Base Rate Loans which
shall be computed on the basis of a 365 or 366 day year as the case may be
(unless the Base Rate is determined by reference to the Federal Funds Rate), all
computations of interest and fees hereunder shall be made on the basis of the
actual number of days elapsed over a year of 360 days. Interest shall accrue
from and including the date of borrowing (or continuation or conversion) but
excluding the date of payment.
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
SECTION 3.01 TAXES.
(a) Payments Net of Certain Taxes. Any and all payments by any
Credit Party to or for the account of any Lender or any Agent hereunder or under
any other Senior Finance Document shall be made free and clear of and without
deduction for any and all present or future taxes, duties, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect thereto,
excluding any and all Excluded Taxes (all such non-Excluded Taxes being
hereinafter referred to as "Taxes"). If any Credit Party shall be required by
law to deduct or withhold any Taxes from or in respect of any sum payable under
this Agreement or any other Senior Finance Document to any Lender or any Agent,
(i) the sum payable shall be increased as necessary so that after making all
required deductions and withholdings (including deductions and withholdings
applicable to additional sums payable under this Section 3.01) such Lender or
such Agent receives an amount equal to the sum it would have received had no
such deductions or withholdings been made, (ii) such Credit Party shall make
such deductions and withholdings, (ii) such Credit Party shall pay the full
amount deducted or withheld to the relevant taxation authority or other
authority in accordance with applicable law and (iv) such Credit Party shall
furnish to the Administrative Agent, at the Administrative Agent's Office, the
original or a certified copy of a receipt, if any, evidencing payment thereof or
other documentation evidencing such payment.
(b) Other Taxes. In addition, the Borrower agrees to pay any and
all present or future stamp or documentary, excise or property taxes or similar
charges or levies (including mortgage recording taxes) which arise from any
payment made by it under this Agreement or any other Senior Finance Document or
from the execution, delivery, registration or enforcement of, or otherwise with
respect to, this Agreement or any other Senior Finance Document (hereinafter
referred to as "Other Taxes").
(c) Additional Taxes. The Borrower agrees to indemnify each Lender
and each Agent for the full amount of Taxes and Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed or asserted by any jurisdiction on
amounts payable under this Section 3.01), as applicable,
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whether or not correctly or legally asserted, paid by such Lender or such Agent
(as the case may be) and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto; provided, however, that if
the Borrower reasonably believes that such Taxes or Other Taxes were not
correctly or legally asserted, the Administrative Agent or the Lender, as the
case may be, will use reasonable efforts to cooperate with the Borrower to
obtain a refund of such Taxes or other Taxes so long as such efforts would not,
in the sole discretion of the Administrative Agent or the Lender, as the case
may be, result in any additional costs, expenses or risks or be otherwise
disadvantageous to it.
(d) U.S. Tax Forms and Certificates. Each Lender organized under
the laws of a jurisdiction outside the United States (a "Non-U.S. Lender"), on
or prior to the date of its execution and delivery of this Agreement in the case
of each Lender listed on the signature pages hereof and on or prior to the date
on which it becomes a Lender in the case of each other Lender, and from time to
time thereafter as required by law, shall provide the Borrower and the
Administrative Agent with (i) Internal Revenue Service Form W-8 BEN, W-8 IMY or
W-8 ECI, as appropriate, or any successor form prescribed by the Internal
Revenue Service, certifying that such Lender is entitled to benefits under an
income tax treaty to which the United States is a party which reduces the rate
of withholding tax on payments of interest or certifying that the income
receivable pursuant to this Agreement is effectively connected with the conduct
of a trade or business in the United States, and (ii) any other form or
certificate required by any taxing authority (including any certificate required
by Sections 871(h) and 881(c) of the Internal Revenue Code), certifying that
such Lender is entitled to an exemption from or a reduced rate of tax on
payments pursuant to this Agreement or any of the other Senior Finance
Documents. Should a Lender, which is otherwise exempt from or subject to a
reduced rate of withholding tax, become subject to Taxes because of its failure
to deliver a form required to be delivered hereunder, the Borrower shall take
such steps as such Lender shall reasonably request to assist such Lender to
recover such Taxes.
(e) Obligations in Respect of Non-U.S. Lenders. The Borrower shall
not be required to indemnify any Non-U.S. Lender or to pay any additional
amounts to any Non-U.S. Lender, in respect of Taxes (other than Other Taxes)
pursuant to subsection (a) above to the extent that the obligation to withhold
amounts with respect to Taxes (other than Other Taxes) existed on the date such
Non-U.S. Lender became a party to this Agreement (or, in the case of a
participant, on the date such participant acquired its participation interest)
or, with respect to payments to a new Applicable Lending Office, the date such
Non-U.S. Lender designated such new Applicable Lending Office with respect to a
Loan; provided, however, that this subsection (e) shall not apply (i) to any
participant or new Applicable Lending Office that becomes a participant or new
Applicable Lending Office as a result of an assignment, participation, transfer
or designation made at the request of the Borrower and (ii) to the extent the
indemnity payment or additional amounts any participant, or any Lender acting
through a new Applicable Lending Office, would be entitled to receive (without
regard to this subsection (e)) do not exceed the indemnity payment or additional
amounts that the Person making the assignment, participation or transfer to such
participant, or Lender (or participant) making the designation of such new
Applicable Lending Office, would have been entitled to receive in the absence of
such assignment, participation, transfer or designation.
(f) Mitigation. If any Credit Party is required to pay additional
amounts to or for the account of any Lender pursuant to this Section 3.01, then
such Lender will agree to use reasonable efforts to change the jurisdiction of
its Applicable Lending Office or to file or deliver to the Borrower any
certificate or document so as to eliminate or reduce any such additional payment
which may thereafter accrue if such change, filing or delivery, in the judgment
of such Lender, is not otherwise disadvantageous to such Lender.
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(g) Tax Receipts. Within thirty days after the date of any payment
of Taxes, the Borrower shall furnish to the Administrative Agent the original or
a certified copy of a receipt evidencing such payment (to the extent the
Borrower receives a receipt for such payment).
(h) Refunds or Credits. If any Lender or Agent (i) receives a
refund from a taxation authority in respect of any tax for which it has been
indemnified by a Credit Party or with respect to which a Credit Party has paid
additional amounts pursuant to this Section 3.01 or (ii) claims any credit or
other tax benefit (such credit to include any increase in any foreign tax
credit) with respect to any tax for which it has been indemnified by a Credit
Party or with respect to which a Credit Party has paid additional amounts
pursuant to this Section 3.01, which refund, credit or other tax benefit in the
sole judgment of such Lender or Agent is directly attributable to any such
indemnified tax or additional amounts, such Lender or Agent shall (within 30
days from the date of such receipt) pay over to such Credit Party the amount of
such refund, credit or other tax benefit (but only to the extent of indemnity
payments made, or additional amounts paid, by such Credit Party with respect to
the tax giving rise to such refund or credit), net of all out-of-pocket expenses
(including any taxes on a refund or on interest received or credited) which such
Lender or Agent certifies that it has reasonably determined to have been
incurred in connection with obtaining such refund, credit or other tax benefit;
provided, however, that (i) each Credit Party shall repay, upon the request of
such Lender or Agent, the amount paid over to such Credit Party (plus penalties,
interest or other charges) to such Lender or Agent in the event such Lender or
Agent is required to repay such refund or credit to such tax authority, (ii)
such Lender or Agent, as the case may be, shall have no obligation to cooperate
with respect to any contest (or continue to cooperate with respect to any
contest), or to seek or claim any refund, credit or other tax benefit if such
Lender or Agent determines that its interest would be adversely affected by so
cooperating (or continuing to cooperate) or by seeking or claiming any such
refund, credit or other tax benefit and (iii) no Credit Party shall have any
right to examine the tax returns or other records of any Lender or Agent or to
obtain any information with respect thereto by reason of the provisions of this
Section 3.01 or any judgment or determination made by any Lender or Agent
pursuant to this Section 3.01.
SECTION 3.02 CHANGE IN LAW, ETC. If, on or after the date of this
Agreement, the adoption of any applicable Law, or any change in any applicable
Law, or any change in the interpretation or administration thereof by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender (or its
Applicable Lending Office) with any request or directive (whether or not having
the force of Law) of any such authority, central bank or comparable agency shall
make it unlawful or impossible for any Lender (or its Applicable Lending Office)
to make, maintain or fund any of its Eurodollar Loans and, in each such case,
the affected Lender shall so notify the Administrative Agent, the Administrative
Agent shall forthwith give notice thereof to the other Lenders and the Borrower,
whereupon, until each affected Lender notifies the Borrower and the
Administrative Agent that the circumstances giving rise to such suspension no
longer exist, (i) the obligation of each affected Lender to make Eurodollar
Loans, or to convert outstanding Loans into Eurodollar Loans, shall be
suspended. Before giving any notice to the Administrative Agent pursuant to this
Section 3.02, such Lender shall designate a different Applicable Lending Office
if such designation will avoid the need for giving such notice and will not, in
the judgment of such Lender, be otherwise disadvantageous to such Lender. If
such notice is given, each Eurodollar Loan of such Lender then outstanding shall
be converted to a Base Rate Loan either (i) on the last day of the then current
Interest Period applicable to such Eurodollar Loan, if such Lender may lawfully
continue to maintain and fund such Loan to such day or (ii) immediately, if such
Lender shall determine that it may not lawfully continue to maintain and fund
such Loan to such day.
SECTION 3.03 BASIS FOR DETERMINING INTEREST RATE INADEQUATE OR
UNFAIR. If on or prior to the first day of any Interest Period for any
Eurodollar Loan:
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(i) the Administrative Agent determines (which determination
shall be conclusive) that by reason of circumstances affecting the
relevant market, adequate and reasonable means do not exist for
ascertaining the applicable Eurodollar Rate for such Interest Period; or
(ii) Lenders having 50% or more of the aggregate amount of
the Commitments of the relevant Class advise the Administrative Agent that
the London Interbank Offered Rate as determined by the Administrative
Agent will not adequately and fairly reflect the cost to such Lenders of
funding their Eurodollar Loans for such Interest Period;
the Administrative Agent shall forthwith give notice thereof to the Borrower and
the relevant Lenders, whereupon, until the Administrative Agent notifies the
Borrower that the circumstances giving rise to such suspension no longer exist,
(i) the obligations of the Lenders to make Eurodollar Loans, or to continue or
convert outstanding Loans as or into Eurodollar Loans, shall be suspended and
(ii) each outstanding Eurodollar Loan shall be converted into a Base Rate Loan
on the last day of the then current Interest Period applicable thereto. Unless
the Borrower notifies the Administrative Agent at least two Business Days before
the date of any Eurodollar Borrowing for which a Notice of Borrowing has
previously been given that it elects not to borrow on such date, such Borrowing
shall instead be made as a Base Rate Borrowing in the same aggregate amount as
the requested Borrowing and shall bear interest for each day from and including
the first day to but excluding the last day of the Interest Period applicable
thereto at the rate applicable to Revolving Base Rate Loans for such day.
SECTION 3.04 INCREASED COSTS AND REDUCED RETURN.
(a) If on or after the date hereof, the adoption of or any change
in any applicable Law or in the interpretation or application thereof applicable
to any Lender (or its Applicable Lending Office), or compliance by any Lender
(or its Applicable Lending Office) with any request or directive (whether or not
having the force of Law) from any central bank or other Governmental Authority,
in each case made subsequent to the Effective Date (or, if later, the date on
which such Lender becomes a Lender):
(i) shall subject such Lender (or its Applicable Lending
Office) to any tax of any kind whatsoever with respect to any Letter of
Credit, any Eurodollar Loans made by it or any of its Notes or its
obligation to make Eurodollar Loans or to participate in Letters of
Credit, or change the basis of taxation of payments to such Lender (or its
Applicable Lending Office) in respect thereof (except for (A) Taxes and
Other Taxes covered by Section 3.01 (including Taxes imposed solely by
reason of any failure of such Lender to comply with its obligations under
Section 3.01(d)) and (B) Excluded Taxes);
(ii) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in or for the account of, advances,
loans or other extensions of credit by, or any other acquisition of funds
by, any office of such Lender (or its Applicable Lending Office) which is
not otherwise included in the determination of the Eurodollar Rate
hereunder; or
(iii) shall impose on such Lender (or its Applicable Lending
Office) any other condition (excluding any tax of any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such Lender
(or its Applicable Lending Office) of making, converting into, continuing or
maintaining any Eurodollar Loans or issuing or participating in Letters of
Credit or to reduce any amount receivable hereunder in respect thereof, then, in
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any such case, upon notice to the Borrower from such Lender, through the
Administrative Agent, in accordance herewith, the Borrower shall be obligated to
pay such Lender, within 10 Business Days of its demand, any additional amounts
necessary to compensate such Lender on an after-tax basis (after taking into
account applicable deductions and credits in respect of the amount indemnified)
for such increased cost or reduced amount receivable.
(b) If any Lender shall have determined that the adoption or the
becoming effective of, or any change in, or any change by any Governmental
Authority, central bank or comparable agency charged with the interpretation or
administration thereof in the interpretation or administration of, any
applicable Law regarding capital adequacy, or compliance by such Lender, or its
parent corporation, with any request or directive regarding capital adequacy
(whether or not having the force of Law) of any such Governmental Authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on such Lender's (or parent corporation's) capital or assets as a
consequence of its commitments or obligations hereunder to a level below that
which such Lender, or its parent corporation, could have achieved but for such
adoption, effectiveness, change or compliance (taking into consideration such
Lender's (or parent corporation's) policies with respect to capital adequacy),
then, upon notice from such Lender to the Borrower, the Borrower shall be
obligated to pay to such Lender such additional amount or amounts as will
compensate such Lender on an after-tax basis (after taking into account
applicable deductions and credits in respect of the amount indemnified) for such
reduction; provided, that the Borrower shall not required to compensate any
Lender pursuant to subsection (a) above or this subsection (b) for any
additional costs or reductions suffered more than 180 days prior to the date
such Lender notifies the Borrower of the circumstances giving rise to such
additional costs or reductions and of such Lender's intentions to claim
compensation therefor, and provided, further, that, if the Change in Law or in
the interpretation or administration thereof giving rise to such additional
costs or reductions is retroactive, then the 180-day period referred to above
shall be extended to include the period of retroactive effect thereof. Each
determination by any such Lender of amounts owing under this Section 3.04 shall,
absent manifest error, be conclusive and binding on the parties hereto.
(c) A certificate in reasonable detail of each Lender setting
forth such amount or amounts as shall be necessary to compensate such Lender or
its holding company as specified in subsection (a) or (b) above, as the case may
be, shall be delivered to the Borrower and shall be conclusive absent manifest
error. The Borrower shall pay each Lender or the Issuing Lender the amount shown
as due on any such certificate delivered by it within 10 Business Days after
receipt of the same.
(d) Promptly after any Lender becomes aware of any circumstance
that will, in its reasonable judgment, result in a request for increased
compensation pursuant to this Section 3.04, such Lender shall notify the
Borrower thereof. Failure on the part of any Lender so to notify the Borrower or
to demand compensation for any increased costs or reduction in amounts received
or receivable or reduction in return on capital with respect to any period shall
not constitute a waiver of such Lender's right to demand compensation with
respect to such period or any other period, except as expressly otherwise
provided above. The protection of this Section 3.04 shall be available to each
Lender regardless of any possible contention of the invalidity or
inapplicability of the law, rule, regulation, guideline or other change or
condition which shall have occurred or been imposed.
SECTION 3.05 FUNDING LOSSES. The Borrower shall indemnify each
Lender against any loss or expense (but excluding in any event loss of
anticipated profit) which such Lender may sustain or incur as a consequence of
(i) any failure by the Borrower to fulfill on the date of any Borrowing
hereunder the applicable conditions set forth in Article IV, (ii) any failure by
the Borrower to borrow or to refinance, convert or continue any Loan hereunder
after irrevocable notice of such Borrowing, refinancing, conversion or
continuation has been given pursuant to Section 2.02 or 2.07, (iii) any payment,
prepayment or conversion of a Eurodollar Loan, whether voluntary or involuntary,
pursuant to
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any other provision of this Agreement or otherwise made on a date other than the
last day of the Interest Period applicable thereto, or (iv) 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 2.10(d),
including, in each such case, any loss or reasonable expense sustained or
incurred or to be sustained or incurred in liquidating or employing deposits
from third parties acquired to effect or maintain such Loan or any part thereof
as a Eurodollar Loan. Such loss or reasonable expense (other than loss of
anticipated profits) shall include an amount equal to the excess, if any, as
reasonably determined by such Lender, of (i) its cost of obtaining the funds for
the Loan being paid, prepaid, converted, not borrowed or assigned (based on the
applicable London Interbank Offered Rate), for the period from the date of such
payment, prepayment, conversion, failure to borrow, convert or continue to the
last day of the Interest Period for such Loan (or, in the case of a failure to
borrow, the Interest Period for such Loan which would have commenced on the date
of such failure to borrow, convert or continue) or assignment over (ii) the
amount of interest (as reasonably determined by such Lender) that would be
realized by such Lender in reemploying the funds so paid, prepaid, converted,
not borrowed, converted or continued for such period or Interest Period or
assignment, as the case may be. A certificate of any Lender setting forth any
amount or amounts which such Lender is entitled to receive pursuant to this
Section 3.05 shall be delivered to the Borrower and shall be conclusive absent
manifest error.
SECTION 3.06 BASE RATE LOANS SUBSTITUTED FOR AFFECTED EURODOLLAR
LOANS. If (i) the obligation of any Lender to make, or to continue or convert
outstanding Loans as or to, Eurodollar Loans has been suspended pursuant to
Section 3.02 or (ii) any Lender has demanded compensation under Section 3.01 or
3.04 with respect to its Eurodollar Loans, and in any such case the Borrower
shall, by at least five Business Days' prior notice to such Lender through the
Administrative Agent, have elected that the provisions of this Section 3.06
shall apply to such Lender, then, unless and until such Lender notifies the
Borrower that the circumstances giving rise to such suspension or demand for
compensation no longer exist, all Loans which would otherwise be made by such
Lender as (or continued as or converted to) Eurodollar Loans shall instead be
Base Rate Loans (on which interest and principal shall be payable
contemporaneously with the related Eurodollar Loans of the other Lenders). If
such Lender notifies the Borrower that the circumstances giving rise to such
suspension or demand for compensation no longer exist, the principal amount of
each such Base Rate Loan shall be converted into a Eurodollar Loan on the first
day of the next succeeding Interest Period applicable to the related Eurodollar
Loans of the other Lenders.
ARTICLE IV
CONDITIONS
SECTION 4.01 CONDITIONS TO CLOSING. The obligation of each Lender to
make a Loan or issue a Letter of Credit on the Closing Date is subject to the
satisfaction of the following conditions:
(a) Executed Senior Finance Documents. Receipt by the
Administrative Agent of duly executed copies of: (i) this Agreement; (ii) the
Notes; (iii) the Guaranty; (iv) the Collateral Documents and (v) all other
Senior Finance Documents, each in form and substance satisfactory to the Lead
Arrangers and the Required Lenders in their sole discretion.
(b) Legal Matters. All legal matters incident to this Agreement
and the borrowings hereunder shall be reasonably satisfactory to the Lead
Arrangers and to Fried, Frank, Harris, Shriver & Jacobson LLP, counsel for the
Lead Arrangers.
(c) Organizational Documents. After giving effect to the
transactions contemplated by the Transaction Documents, the ownership, capital,
corporate, organizational and legal structure of each Credit Party shall be
reasonably satisfactory to the Lead Arrangers, and the Administrative Agent
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shall have received: (i) a copy of the certificate or articles of incorporation
or other organizational documents, as applicable, including all amendments
thereto, of each Credit Party, certified as of a recent date by the Secretary of
State or other applicable authority of its respective jurisdiction of
organization; (ii) a certificate as to the good standing of each Credit Party,
as of a recent date, from the Secretary of State or other applicable authority
of its respective jurisdiction of organization and, to the extent reasonably
available, from each other state in which such Credit Party is qualified or is
required to be qualified to do business, together in each case, to the extent
generally available, with a certificate or other evidence of good standing as to
payment of any applicable franchise or similar taxes from the appropriate taxing
authority of each such jurisdiction; (iii) a certificate of the Secretary or
Assistant Secretary of each Credit Party dated the Closing Date substantially in
the form of Exhibit L hereto; (iv) a certificate of another officer as to the
incumbency and specimen signature of the Secretary or Assistant Secretary
executing the certificate pursuant to clause (iii) above; and (v) such other
corporate or other constitutive or organizational documents as the Lead
Arrangers or Fried, Frank, Harris, Shriver & Jacobson LLP, counsel for the Lead
Arrangers, may reasonably request.
(d) Officer's Certificates. The Administrative Agent shall have
received (i) a certificate, dated the Closing Date and signed by a Responsible
Officer of each of Holdings, Intermediate Holdings and the Borrower, confirming
compliance with the conditions precedent set forth in paragraphs (b) and (c) of
Section 4.02 and (ii) a certificate, dated the Closing Date and signed by a
Responsible Officer of each other Credit Party, confirming compliance with the
condition precedent set forth in paragraph (b) of Section 4.02.
(e) Opinions of Counsel. On the Closing Date, the Administrative
Agent shall have received:
(i) a written opinion of Kirkland & Ellis LLP, special
counsel to the Credit Parties, addressed to the Agents and each Lender,
dated the Closing Date, substantially in the form of Exhibit D-1 hereto;
(ii) from Kirkland & Ellis LLP, special counsel to the Credit
Parties, or special local counsel to the Borrower and the other Credit
Parties (which counsel shall be reasonably satisfactory to the Lead
Arrangers) for each State in which any Credit Party is located (within the
meaning of Section 9-301 of the Uniform Commercial Code as in effect in
the State of New York), an opinion addressed to the Agents and each
Lender, dated the Closing Date, substantially in the form of Exhibit D-2
hereto and covering such additional matters incident to the transactions
contemplated hereby as the Lead Arrangers or the Required Lenders may
reasonably request;
(iii) from special local counsel to the Borrower and the other
Credit Parties (which counsel shall be reasonably satisfactory to the Lead
Arrangers) for each jurisdiction in which a Mortgaged Property is located,
an opinion addressed to the Agents and each Lender, dated the Closing
Date, substantially in the form of Exhibit D-3 hereto, with respect to the
enforceability of the form of Mortgage and sufficiency of the form of
UCC-1 financing statements or similar notices to be recorded or filed in
such jurisdiction, if applicable, and such other matters as the Lead
Arrangers or the Required Lenders may reasonably request;
(iv) from special counsel to the Target in respect of the
Acquisition, copies of each opinion delivered by them in connection with
the Acquisition, accompanied in each case by a letter from such counsel
stating that the Agents and the Lenders are entitled to rely on such
opinions as if they were addressed to the Agents and the Lenders; and
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(v) from Kirkland & Ellis LLP, special counsel to the
Borrower, copies of the opinions delivered by them under the purchase
agreement for the Subordinated Debentures, accompanied in each case by a
letter from such special counsel stating that the Agents and the Lenders
are entitled to rely on such opinions as if they were addressed to the
Agents and the Lenders.
(f) Capitalization. On or prior to the Closing Date, (i)
AcquisitionCo shall have received gross cash proceeds of not less than
$95,000,000 (less the amount of Rollover Stock (as defined in the Acquisition
Agreement)) in connection with the purchase by the Investor Group of common and
preferred equity of AcquisitionCo (the "Investor Equity Issuance"), (ii)
Intermediate Holdings shall have received gross cash proceeds of not less than
$60,000,000 in connection with the Investor Preferred Equity Issuance (less the
amount of Rollover Stock as defined in the Acquisition Agreement), (iii) without
the express written consent of the Lead Arrangers, no common or preferred stock
of Holdings, Intermediate Holdings or the Borrower shall be subject to any
redemption, put, call, repurchase or similar provisions prior to the Maturity
Date with respect to any Loan (except in connection with the Management Put
Rights and preemptive rights), (iv) the proceeds of the Investor Equity Issuance
and the Investor Preferred Equity Issuance, when aggregated with the
Subordinated Debentures and the Term B Loan incurred by the Borrower on the
Closing Date, shall be used, and shall be sufficient, to pay the purchase price
required to be paid on the Closing Date to consummate the Acquisition and to pay
all fees and expenses owing in connection therewith on the Closing Date, and (v)
the Administrative Agent shall have received true and correct copies, certified
as such by an appropriate officer of Holdings, of all subscription agreements,
registration rights agreements, shareholder agreements and other documents and
instruments delivered in connection therewith (collectively, the "Capitalization
Documents"), each of which shall be in full force and effect and shall be in
form and substance reasonably satisfactory to the Lead Arrangers.
(g) Issuance of Subordinated Debentures. On or prior to the
Closing Date, the Borrower shall have (A) entered into the Subordinated
Debentures Documents on terms that are reasonably satisfactory to the Lead
Arrangers, (B) executed and delivered the Subordinated Debentures, (C) delivered
to the Administrative Agent true and correct copies, certified as such by an
appropriate officer of the Borrower, of the Subordinated Debentures Indenture,
each of the Subordinated Debentures as originally executed and delivered and
each of the other Subordinated Debentures Documents (on terms that are
reasonably satisfactory to the Lead Arrangers), each of which shall be in full
force and effect, and (D) utilized the full amount of such cash proceeds to make
payments owing in connection with the Transaction prior to or concurrently with
the utilization of any proceeds of the Loans for such purpose.
(h) Consummation of the Acquisition. On or prior to the Closing
Date, there shall have been delivered to the Administrative Agent true and
correct copies of all Acquisition Documents, certified as such by an appropriate
officer of the Borrower, and all terms and conditions of the Acquisition
Documents shall be in form and substance reasonably satisfactory to the Lead
Arrangers. The Acquisition, including all of the terms and conditions thereof
and including, without limitation, the Merger, shall have been duly approved by
the board of directors and (if required by applicable law) the shareholders of
each of the Borrower (prior to the consummation of the Merger), the Target and
each other Group Company party thereto, and all Acquisition Documents shall have
been duly executed and delivered by the parties thereto and shall be in full
force and effect. The representations and warranties set forth in the
Acquisition Documents shall be true and correct in all material respects as if
made on and as of the Closing Date (except to the extent such representations
and warranties expressly refer to a prior date, in which case such
representations and warranties shall have been true and correct as of such prior
date), and each of the parties to the Acquisition Documents shall have complied
in all material respects with all covenants set forth in the Acquisition
Documents to be complied with by it on or prior to the Closing Date (without
giving effect to any modification, amendment, supplement or waiver of any of the
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material terms thereof unless consented to by the Lead Arrangers, which consent
shall not be unreasonably withheld or delayed). Each of the material conditions
precedent to the Group Companies' obligations to consummate the Acquisition as
set forth in the Acquisition Documents shall have been satisfied to the
reasonable satisfaction of the Lead Arrangers or waived with the consent of the
Lead Arrangers, and, on or prior to the Closing Date and prior to the borrowing
of the initial Loans, the Acquisition shall have been consummated for aggregate
consideration not in excess of $510,000,000 (excluding purchase price
adjustments) (excluding related transaction fees and expenses not exceeding
$20,000,000) in accordance with all applicable laws and the Acquisition
Documents (without giving effect to any material amendment or modification
thereof or material waiver with respect thereto including, but not limited to,
any material modification, amendment, supplement or waiver relating to any
disclosure schedule or exhibit, unless such modification, amendment, supplement
or waiver could not reasonably be expected to be materially adverse in any
respect to the Lenders or unless consented to by the Lead Arrangers). On the
Closing Date, the certificate of merger with respect to the Merger shall have
been filed with the appropriate Governmental Authority having primary
jurisdiction over affairs of corporations in Delaware.
(i) Refinancing of Certain Existing Debt; Other Debt. On the
Closing Date, the commitments under all Refinanced Agreements shall have been
terminated, all loans outstanding thereunder shall have been repaid in full
(other than contingent indemnification obligations not due and payable),
together with accrued interest thereon (including, without limitation, any
prepayment premium), all letters of credit issued thereunder shall have been
terminated or backstopped through the issuance of Letters of Credit hereunder or
shall have become Letters of Credit hereunder and all other amounts owing
pursuant to each Refinanced Agreement shall have been repaid in full, and the
Administrative Agent shall have received evidence in form, scope and substance
reasonably satisfactory to the Lead Arrangers that the matters set forth in this
subsection (i) have been satisfied at such time. In addition, on the Closing
Date, the creditors under each Refinanced Agreement shall have terminated and
released all applicable Liens on the capital stock of and assets owned by the
Borrower and its Subsidiaries (including, without limitation, all capital stock
and assets of Holdings and its Subsidiaries), and the Lead Arrangers shall have
received all such releases as may have been requested by the Lead Arrangers,
which releases shall be in form and substance satisfactory to the Lead
Arrangers. After the consummation of the transactions contemplated by the
Acquisition Agreement on the Closing Date, the Group Companies shall have no
material liabilities (actual or contingent) required to be disclosed in its
financial statements or Preferred Stock, except (i) as disclosed in the most
recent interim balance sheet included in the financial statements delivered
pursuant to subsection (q) below or the footnotes thereto, (ii) for current
obligations and contractual obligations incurred in the ordinary course of
business, (iii) Debt under the Senior Finance Documents and the Subordinated
Debentures, (iv) the Junior Debentures and the preferred stock issued in
connection with the Investor Preferred Equity Issuance and (v) contingent
indemnification obligations not due and payable.
(j) Perfection of Personal Property Security Interests and
Pledges; Search Reports. On or prior to the Closing Date, the Collateral Agent
shall have received or have completed or arrangements satisfactory to the
Collateral Agent shall have been provided for:
(i) a Perfection Certificate from each Credit Party;
(ii) appropriate financing statements (Form UCC-1 or such
other financing statements or similar notices as shall be required by
local law) authenticated and authorized for filing under the Uniform
Commercial Code or other applicable local law of each jurisdiction in
which the filing of a financing statement or giving of notice may be
required, or reasonably requested by the Collateral Agent, to perfect the
security interests created by the Collateral Documents;
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(iii) copies of reports from CT Corporation or another
independent search service reasonably satisfactory to the Collateral Agent
listing all effective financing statements, notices of tax, PBGC or
judgment liens or similar notices that name the Borrower or any other
Credit Party, as such (under its present name and any previous name and,
if requested by the Collateral Agent, under any trade names), as debtor or
seller that are filed in the jurisdictions referred to in clause (ii)
above or in any other jurisdiction having files which must be searched in
order to determine fully the existence of Uniform Commercial Code security
interests, notices of the filing of federal tax Liens (filed pursuant to
Section 6323 of the Code), Liens of the PBGC (filed pursuant to Section
4068 of ERISA) or judgment Liens on any Collateral, together with copies
of such financing statements, notices of tax, PBGC or judgment Liens or
similar notices (none of which shall cover the Collateral except to the
extent evidencing Permitted Liens or for which the Collateral Agent shall
have received termination statements (Form UCC-3 or such other termination
statements as shall be required by local law) authenticated and authorized
for filing);
(iv) searches of ownership of intellectual property in the
appropriate governmental offices and such patent, trademark and/or
copyright filings as may be requested by the Collateral Agent to the
extent necessary or reasonably advisable to perfect the Collateral Agent's
security interest in intellectual property Collateral;
(v) all of the Pledged Collateral, which Pledged Collateral
shall be in suitable form for transfer by delivery, or shall be
accompanied by duly executed instruments of transfer or assignment in
blank, with signatures appropriately guaranteed, accompanied in each case
by any required transfer tax stamps, all in form and substance reasonably
satisfactory to the Collateral Agent; and
(vi) evidence of the completion of all other filings and
recordings of or with respect to the Collateral Documents and of all other
actions as may be necessary or, in the opinion of the Collateral Agent,
desirable to perfect the security interests intended to be created by the
Collateral Documents.
(k) Real Property Collateral. The Collateral Agent shall have
received (in form and substance satisfactory to the Lead Arrangers):
(i) fully executed and notarized mortgages, deeds of trust
or deeds to secure debt (each a "Mortgage" and, collectively, the
"Mortgages") encumbering the fee interest of the Credit Parties in each
real property asset owned by a Credit Party set forth on Schedule
4.01(k)(i) (each an "Owned Mortgaged Property" and collectively, the
"Owned Mortgaged Properties") and the leasehold interest of the Credit
Parties in each real property asset leased by a Credit Party set forth on
Schedule 4.01(k)(i) (each a "Leased Mortgaged Property" and, collectively,
the "Leased Mortgaged Properties" and, together with the Owned Mortgaged
Property, each a "Mortgaged Property" and, collectively, the "Mortgaged
Properties"), together with such UCC-1 financing statements or similar
notices as the Collateral Agent shall reasonably deem appropriate with
respect to each such Mortgaged Property;
(ii) the Borrower shall have obtained a fully executed
Landlord Consent and Estoppel with respect to each Leased Mortgaged
Property, together with evidence that such Leased Mortgaged Property is a
Recorded Leasehold Interest;
(iii) ALTA or other appropriate form mortgagee title insurance
policies (the "Mortgage Policies") issued by Chicago Title Insurance
Company (the "Title Insurance
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Company"), in an amount reasonably satisfactory to the Lead Arrangers with
respect to each Mortgaged Property, which amount shall not exceed the fair
market value for each such Mortgaged Property, assuring the Lead Arrangers
that the applicable Mortgages create valid and enforceable first priority
mortgage liens on the respective Mortgaged Property, free and clear of all
defects and encumbrances except Permitted Encumbrances, which Mortgage
Policies shall contain such endorsements as shall be reasonably
satisfactory to the Lead Arrangers and for any other matters that the Lead
Arrangers may request, and providing affirmative insurance and such
reinsurance as the Lead Arrangers may request, all of the foregoing in
form and substance reasonably satisfactory to the Lead Arrangers;
(iv) if requested by the Lead Arrangers, copies of all
recorded documents listed as exceptions to title or otherwise referred to
in the Mortgage Policies; and
(v) such evidence satisfactory to the Lead Arrangers as the
Lead Arrangers reasonably may request to the effect that each of the
Mortgaged Properties, and the uses of the Mortgaged Properties, are in
compliance in all material respects with all applicable Laws.
(l) Evidence of Insurance. Receipt by the Collateral Agent of
copies of insurance policies or certificates of insurance of the Credit Parties
and their Subsidiaries evidencing liability and casualty insurance meeting the
requirements set forth in the Senior Finance Documents, including, but not
limited to, naming the Collateral Agent as additional insured and loss payee on
behalf of the Lenders.
(m) Consents and Approvals. On the Closing Date, all governmental
(domestic or foreign), regulatory and third party approvals (including, without
limitation, with respect to real property leases and license agreements relating
to intellectual property) required and material in connection with the
transactions contemplated by the Acquisition Agreement and the other Transaction
Documents and otherwise referred to herein or therein shall have been obtained
and remain in full force and effect, and all applicable waiting periods
(including any applicable waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976) and appeal periods shall have expired, in each case
without any action being taken or threatened by any competent authority which
has or could have a reasonable likelihood of restraining, preventing or imposing
materially burdensome conditions on such transactions or impose, in the sole
judgment of the Lead Arrangers, materially burdensome conditions or
qualifications upon the consummation of such transactions.
(n) Litigation; Judgments. On the Closing Date, there shall be no
actions, suits, proceedings, counterclaims or investigations pending or overtly
threatened (i) challenging the consummation of any portion of the Transaction or
which in the judgment of the Lead Arrangers or the Required Lenders could
restrain, prevent or impose burdensome conditions on the Transaction, in the
aggregate, or any other transaction contemplated hereunder, (ii) seeking to
prohibit the ownership or operation by Holdings, the Borrower, or any of their
respective Subsidiaries of all or any material portion of any of their
respective businesses or assets or (iii) seeking to obtain, or which could
result or has resulted in the entry of, any judgment, order or injunction that
(A) would restrain, prohibit or impose adverse or burdensome conditions on the
ability of the Lenders to make the Loans, (B) in the judgment of the Lead
Arrangers and the Required Lenders could reasonably be expected to result in a
Material Adverse Effect with respect to Holdings, the Borrower and their
Subsidiaries taken as a whole (after giving effect to the Transaction) or (C)
could purport to affect the legality, validity or enforceability of any Senior
Finance Document or could have a material adverse effect on the ability of any
Credit Party to fully and timely perform their payment and security obligations
under the Senior Finance Documents or the rights and remedies of the Lenders.
Additionally, there shall not exist any judgment, order, injunction or other
restraint issued or filed or a hearing seeking injunctive relief or other
restraint pending or notified
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prohibiting or imposing materially adverse conditions upon the consummation of
the transactions contemplated by the Transaction Documents and otherwise
referred to herein or therein.
(o) Solvency Certificate. On or prior to the Closing Date, the
Borrower shall have delivered or caused to be delivered to the Administrative
Agent a solvency certificate from the chief financial or chief accounting
officer of the Borrower, substantially in the form of Exhibit K hereto and
otherwise in form and substance reasonably satisfactory to the Lead Arrangers,
setting forth the conclusions that, after giving effect to the Acquisition and
the consummation of all financings contemplated herein, Holdings and its
Subsidiaries (on a consolidated basis) and the Borrower and its Subsidiaries (on
a consolidated basis) are solvent.
(p) Environmental Reports. On or prior to the Closing Date, if
requested by the Lead Arrangers in their reasonable discretion, the Borrower
shall have delivered or caused to be delivered to the Administrative Agent the
environmental assessment reports with respect to the Tempe, AZ and
Goodlettsville, TN facilities) in scope, form and substance and prepared by
Gaiatech, Incorporated or another environmental consultant, in each case
satisfactory to the Lead Arrangers, together with reliance letters with respect
thereto as reasonably requested by the Lead Arrangers.
(q) Financial Information. The Administrative Agent and the Lead
Arrangers shall each be reasonably satisfied that the financial statements
referred to in Section 5.05, including the pro-forma balance sheet referenced to
in Section 5.05(b), are not materially inconsistent with the information,
projections, sources and uses of funds or financial model delivered to the Lead
Arrangers prior to the Closing Date.
(r) Material Adverse Effect. There shall not have occurred or
become known any condition, fact, event or development that has resulted or
could reasonably be expected to result in a material adverse change in the
business, assets, operations, condition (financial or otherwise), liabilities
(contingent or otherwise) or prospects of Holdings and its Subsidiaries
(including the Borrower and its Subsidiaries), taken as a whole (both before and
after giving effect to the Transaction) since December 31, 2003.
(s) Management Employment Agreements and Arrangements. On or prior
to the Closing Date, there shall have been delivered to the Administrative Agent
copies of management employment agreements or arrangements, including management
equity incentive agreements, and all terms and conditions of such management
employment agreements or arrangements shall be, as of the Closing Date, in form
and substance reasonably satisfactory to the Lead Arrangers.
(t) Minimum EBITDA; Maximum Pro-Forma Leverage Ratio. The Lead
Arrangers shall have received reasonably satisfactory evidence (including
satisfactory supporting schedules and other data) that: (i) pro-forma EBITDA of
Holdings and its subsidiaries after giving effect to the Transactions for the
trailing four quarters ended December 31, 2003, calculated in a manner
reasonably acceptable to the Lead Arrangers was not less than $60.0 million and
(ii) the ratio of pro forma consolidated debt (not including undrawn letters of
credit) to pro forma EBITDA of Holdings, Borrower and its subsidiaries after
giving effect to the Transaction for the trailing four quarters ended December
31, 2003, calculated in a manner reasonably acceptable to the Lead Arrangers,
was not greater than 6.22x (based on an average outstanding revolver balance
necessary to meet average working capital needs over a 12 month period). At the
Closing Date, the maximum aggregate outstandings under all Letters of Credit
shall not exceed $4,648,431.
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(u) OFAC/Anti-Terrorism Compliance Certificate. The Administrative
Agent shall have received a certificate substantially in the form of Exhibit J
hereto, dated the Closing Date and signed by a Responsible Officer of Holdings,
certifying as to the matters set forth in Exhibit J.
(v) Payment of Fees. All costs, fees and expenses due to the Lead
Arrangers, the Agents and the Lenders on or before the Closing Date shall have
been paid to the extent invoiced to the Borrower (together with reasonable
detail therefor).
(w) Counsel Fees. The Lead Arrangers shall have received full
payment from the Borrower of the fees and expenses of Fried, Frank, Harris,
Shriver & Jacobson LLP described in Section 10.04 which are billed through the
Closing Date.
All corporate and legal proceedings and instruments and agreements
relating to the transactions contemplated by this Agreement and the other
Transaction Documents or in any other document delivered in connection herewith
or therewith shall be reasonably satisfactory in form and substance to the Lead
Arrangers and their counsel, and the Lead Arrangers shall have received all
information and copies of all documents and papers, including records of
corporate proceedings, governmental approvals, good standing certificates and
bring-down facsimiles, if any, which the Lead Arrangers reasonably may have
requested in connection therewith, such documents and papers where appropriate
to be certified by proper corporate or Governmental Authorities. The documents
referred to in this Section 4.01 shall be delivered to the Administrative Agent
or Lead Arrangers, as applicable, no later than the Closing Date. The
certificates and opinions referred to in this Section 4.01 shall be dated the
Closing Date.
The requirement that any document, agreement, certificate or other
writing be reasonably satisfactory to the Required Lenders shall be deemed to be
satisfied if (i) such document, agreement, certificate or other writing was
delivered to the Lenders not less than two Business Days prior to the Closing
Date, (ii) such document, agreement, certificate or other writing is
satisfactory to the Lead Arrangers and (iii) Lenders holding at least 50% of the
Commitments have not objected in writing to such document, agreement,
certificate or other writing to the Lead Arrangers prior to the Closing Date.
Promptly after the Closing Date occurs, the Administrative Agent
shall notify the Borrower and the Lenders of the Closing Date, and such notice
shall be conclusive and binding on all parties hereto. If the Closing Date does
not occur before 5:00 P.M. on April 30, 2004, the Commitments shall terminate at
the close of business on such date and all unpaid fees accrued to such date
shall be due and payable on such date.
SECTION 4.02 CONDITIONS TO ALL CREDIT EXTENSIONS. The obligation of
any Lender to make a Loan on the occasion of any Borrowing and the obligation of
any Issuing Lender to issue (or renew or extend the term of) any Letter of
Credit is subject to the satisfaction of the following conditions:
(a) Notice. The Borrower shall have delivered (i) in the case of
any Revolving Loan, to the Administrative Agent, an appropriate Notice of
Borrowing, duly executed and completed, by the time specified in, and otherwise
as permitted by, Section 2.02 and (ii) in the case of any Letter of Credit, to
the Issuing Lender, an appropriate Letter of Credit Request duly executed and
completed in accordance with the provisions of Section 2.05.
(b) Representations and Warranties. The representations and
warranties made by the Credit Parties in any Senior Finance Document are true
and correct in all material respects at and as if made as of such date except to
the extent they expressly relate to an earlier date.
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(c) No Default. No Default or Event of Default shall exist or be
continuing either prior to or after giving effect thereto.
(d) Availability. Immediately after giving effect to the making of
a Loan (and the application of the proceeds thereof) or to the issuance of a
Letter of Credit, as the case may be, (i) the sum of the Revolving Loans
outstanding plus the amount of all LC Obligations outstanding plus all Swingline
Loans outstanding shall not exceed the Revolving Committed Amount, (ii) the
amount of all LC Obligations outstanding shall not exceed the LC Committed
Amount and (iii) the sum of all Swingline Loans outstanding shall not exceed the
Swingline Committed Amount.
(e) Term Borrowings. In the case of the initial Revolving
Borrowing, the fact that prior to, or concurrently with, such Revolving
Borrowing, the Borrower has made a Term B Borrowing in the full amount of the
Term B Commitments.
The delivery of each Notice of Borrowing, Swingline Loan Request and
each request for a Letter of Credit shall constitute a representation and
warranty by the Credit Parties of the correctness of the matters specified in
subsections (b), (c) and (d) above.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
Each of Holdings, Intermediate Holdings and the Borrower represents
and warrants that:
SECTION 5.01 ORGANIZATION AND GOOD STANDING. Each of the Group
Companies is a corporation, partnership or limited liability company duly
organized or formed, validly existing and in good standing under the laws of the
jurisdiction of its formation, has all corporate, partnership or limited
liability company powers and all material governmental licenses, franchises,
permits, certificates, authorizations, qualifications, accreditations,
easements, rights of way and other rights, consents and approvals required to
own its property and carry on its business as now conducted and is duly
qualified as a foreign corporation, licensed and in good standing in each
jurisdiction where qualification or licensing is required by the nature of its
business or the character and location of its property, business or customers,
except to the extent the failure to so qualify or be licensed, as the case may
be, in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.
SECTION 5.02 POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS. Each of
the Credit Parties has the corporate, partnership, limited liability company or
other necessary power and authority, and the legal right, to execute, deliver
and perform the Transaction Documents to which it is a party and, in the case of
the Borrower, to obtain extensions of credit hereunder, and has taken all
necessary corporate, partnership or limited liability action to authorize the
borrowings and other extensions of credit on the terms and conditions of this
Agreement and to authorize the execution, delivery and performance of the
Transaction Documents to which it is a party. No consent or authorization of,
filing with, notice to or other similar act by or in respect of, any
Governmental Authority or any other Person is required to be obtained or made by
or on behalf of any Credit Party in connection with the borrowings or other
extensions of credit hereunder or with the execution, delivery, performance,
validity or enforceability of the Transaction Documents, except for (i)
consents, authorizations, notices and filings disclosed in Schedule 5.02, all of
which have been obtained or made, and (ii) filings to perfect the Liens created
by the Collateral Documents. This Agreement has been, and each other Transaction
Document to which Holdings or any of its Subsidiaries is a party will be, duly
executed and delivered on behalf of such Person. This Agreement constitutes, and
each other Transaction Document to which any Credit Party or Holdings is a party
when executed and delivered will constitute, a legal, valid and binding
obligation of each Credit Party thereto and, to the knowledge of Holdings and
the Borrower enforceable against each
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such Person in accordance with its terms, except (i) as such enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditors' rights generally and (ii)
that rights of acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability (regardless of whether
enforcement is sought by proceedings in equity or at law).
SECTION 5.03 NO CONFLICTS. Neither the execution and delivery by any
Credit Party of the Transaction Documents to which it is a party, nor the
consummation of the transactions contemplated therein, nor performance of and
compliance with the terms and provisions thereof by such Person, nor the
exercise of remedies by the Agents and the Lenders under the Senior Finance
Documents, will (i) violate or conflict with any provision of the articles or
certificate of incorporation, bylaws, partnership agreement, operating agreement
or other organizational or governing documents of such Person, (ii) violate,
contravene or conflict with any Law applicable to it or its properties, (iii)
violate, contravene or conflict with contractual provisions of, cause an event
of default under, or give rise to material increased, additional, accelerated or
guaranteed, rights of any Person under, any indenture, loan agreement, mortgage,
deed of trust or other instrument, material contract or material lease to which
it is a party or by which it may be bound or (iv) result in or require the
creation of any Lien (other than the Lien of the Collateral Documents) upon or
with respect to its properties, except in the case of clause (iii) for such
violations as could not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect.
SECTION 5.04 NO DEFAULT. Except as disclosed on Schedule 5.04, none
of the Group Companies is in default in any respect under (i) any loan
agreement, indenture, mortgage, security agreement or other agreement relating
to Debt or any other contract, lease, agreement or obligation to which it is a
party or by which any of its properties is bound which default could reasonably
be expected to have a Material Adverse Effect, (ii) the Subordinated Debentures
Indenture or (iii) the Junior Debentures Indenture. No Default or Event of
Default has occurred or exists.
SECTION 5.05 FINANCIAL CONDITION.
(a) Audited Financial Statements. The consolidated balance sheets
of Holdings and its Consolidated Subsidiaries as of December 31, 2001, December
31, 2002 and December 31, 2003 and the related consolidated and consolidating
statements of income and cash flows for the respective fiscal years then ended,
reported on by PricewaterhouseCoopers LLP, copies of each of which have been
delivered to each of the Lenders, fairly present in all material respects, in
accordance with GAAP (except as disclosed therein), the consolidated financial
position of Holdings and its Consolidated Subsidiaries as of each such date and
their consolidated results of operations and cash flows for such fiscal year.
(b) Pro-Forma Financial Statements. The consolidated balance sheet
of Holdings and its Consolidated Subsidiaries as of the end of the most recent
fiscal quarter prior to the Closing Date for which financial information is
available, prepared on a pro-forma basis in accordance with Regulation S-X
giving effect to the consummation of the Transactions, has heretofore been
furnished to each Lender as part of the Pre-Commitment Information. Such
pro-forma balance sheet has been prepared in good faith by the Borrower, based
on the assumptions used to prepare the pro-forma financial information contained
in the Pre-Commitment Information (which assumptions are believed by the
Borrower on the date hereof and on the Closing Date to be reasonable and fair in
light of current conditions and facts known to the Borrower), is based on the
best information available to the Borrower as of the date of delivery thereof,
accurately reflects all material adjustments required to be made to give effect
to the Transactions and presents fairly on a pro-forma basis the estimated
consolidated financial position of Holdings and its Consolidated Subsidiaries as
of December 31, 2003, assuming that the Transactions had actually occurred on
that date. None of Holdings or any of its Subsidiaries has any reason to believe
that
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such pro-forma balance sheet is misleading in any material respect in light of
the circumstances existing at the time of the preparation thereof.
(c) Projections. The projections prepared as part of, and included
in, the Pre-Commitment Information (which include projected balance sheets,
income and cash flow statements on a quarterly basis for the period from the
Closing Date through December 31, 2008 and on an annual basis for each of the
following two fiscal years) have been prepared on a basis consistent with the
financial statements referred to in subsection (a) above and are based on good
faith estimates and assumptions believed by management of the Borrower to be
reasonable and fair in light of current conditions and facts known to the
Borrower at the time delivered. On the Closing Date, such management believes
that such projections are reasonable and attainable, it being recognized by the
Lenders, however, that projections as to future events are not to be viewed as
facts or guaranties of future performance, that actual results during the period
or periods covered by such projections may differ from the projected results and
that such differences may be material and that the Credit Parties make no
representation that such projections will be in fact be realized. There is no
fact known to Holdings or the Borrower or any of their Subsidiaries which could
reasonably be expected to have a Material Adverse Effect which has not been
disclosed herein or in the Pre-Commitment Information.
(d) Post-Closing Financial Statements. The financial statements
delivered to the Lenders pursuant to Section 6.01(a) and (b), if any, (i) have
been prepared in accordance with GAAP (except as may otherwise be permitted
under Section 6.01(a) and (b)) and (ii) present fairly in all material respects
(on the basis disclosed in the footnotes to such financial statements, if any)
the consolidated and consolidating financial condition, results of operations
and cash flows of Holdings and its Consolidated Subsidiaries as of the
respective dates thereof and for the respective periods covered thereby.
(e) No Undisclosed Liabilities. Except as disclosed on Schedule
5.05 hereto or as fully reflected in the financial statements described in
subsection (a) and (b) above and the Debt incurred under this Agreement, the
Subordinated Debentures Documents and the Junior Debentures Documents, (i) there
were as of the Closing Date (and after giving effect to any Loans made and
Letters of Credit issued on such date), no liabilities or obligations (excluding
current obligations and contractual obligations incurred in the ordinary course
of business) with respect to any Group Company of any nature whatsoever (whether
absolute, accrued, contingent or otherwise and whether or not due and including
obligations or liabilities for taxes, long-term leases and unusual forward or
other long-term commitments), and (ii) neither Holdings nor the Borrower knows
of any basis for the assertion against any Group Company of any such liability
or obligation in each case which, either individually or in the aggregate, are
or could reasonably be expected to have, a Material Adverse Effect.
(f) Sarbanes-Oxley Act Compliance. To the extent applicable to
each Group Company subject thereto, each required form, report and document
containing financial statements that has been filed with or submitted to the
United States Securities and Exchange Commission since July 31, 2002, was
accompanied by the certifications required to be filed or submitted by the chief
executive officer and chief financial officer of any Group Company pursuant to
the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act"), and at the time of
filing or submission of each such certification, such certification was true and
accurate and complied in all material respects with the Sarbanes-Oxley Act and
the rules and regulations promulgated thereunder, except to the extent the
failure to do so could not reasonably be expected to have a Material Adverse
Effect. No Group Company nor, to the knowledge of Holdings or the Borrower, any
director, senior officer, employee, auditor, accountant or authorized
representative of any Group Company has received or otherwise had or obtained
knowledge of any complaint, allegation, assertion or claim, whether written or
oral, regarding the accounting or auditing practices, procedures, methodologies
or methods of any Group Company or their respective internal accounting
controls, including any complaint, allegation, assertion or claim that any Group
Company has
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engaged in questionable accounting or auditing practices, in each case which if
determined to be valid could reasonably be expected to have a Material Adverse
Effect. Except as set forth on Schedule 5.05, to the knowledge of Holdings and
the Borrower, no attorney representing any Group Company, whether or not
employed by any Group Company, has reported evidence of a material violation of
securities laws, breach of fiduciary duty or similar violation by any Group
Company or any of its officers, directors, employees or agents to the board of
directors of any Group Company or any committee thereof or to any director or
officer of any Group Company, in each case which if determined to have occurred
could reasonably be expected to have a Material Adverse Effect.
SECTION 5.06 NO MATERIAL CHANGE. Since December 31, 2003 there has
been no Material Adverse Effect, and no event or development has occurred which
could reasonably be expected to result in a Material Adverse Effect.
SECTION 5.07 TITLE TO PROPERTIES; POSSESSION UNDER LEASES. Each
Group Company has good insurable and legal fee title to (in the case of owned
Real Property), or valid leasehold interests in (in the case of Leaseholds), all
its material properties and assets, except for minor defects in title that do
not interfere with its ability to conduct its business as currently conducted.
All such material properties and assets are free and clear of Liens other than
Permitted Liens. Each Group Company has complied with all obligations under all
leases to which it is a party, other than leases that, individually or in the
aggregate, are not material to the Group Companies, taken as a whole, and the
violation of which will not result in a Material Adverse Effect, and all such
leases are in full force and effect, other than leases that, individually or in
the aggregate, are not material to the Group Companies, taken as a whole, and in
respect of which the failure to be in full force and effect will not result in a
Material Adverse Effect. Each Group Company enjoys peaceful and undisturbed
possession under all such leases with respect to which it is the lessee, other
than leases that, individually or in the aggregate, are not material to the
Group Companies, taken as a whole, and in respect of which the failure to enjoy
peaceful and undisturbed possession will not result in a Material Adverse
Effect.
SECTION 5.08 LITIGATION. Except as disclosed in Schedule 5.08, there
are no actions, suits, investigations or legal, equitable, arbitration or
administrative proceedings pending or, to the knowledge of any Credit Party,
threatened against or affecting any Group Company in which there is a reasonable
possibility of an adverse decision that (i) involve any Senior Finance Document
or any of the Transactions or (ii) if adversely determined, could reasonably be
expected, individually or in the aggregate, to result in a Material Adverse
Effect.
SECTION 5.09 TAXES. Except as disclosed in Schedule 5.09 or
otherwise permitted by Section 6.05, each Group Company has filed, or caused to
be filed, all federal and all material state, local and foreign tax returns)
required to be filed and paid (i) all amounts of taxes shown thereon to be due
(including interest and penalties) and (ii) all other taxes, fees, assessments
and other governmental charges (including mortgage recording taxes, documentary
stamp taxes and intangible taxes) owing by it. No Credit Party knows of any
pending investigation of such party by any taxing authority or proposed tax
assessments against any Group Company.
SECTION 5.10 COMPLIANCE WITH LAW. Except as disclosed in Schedule
5.10, each Group Company is in compliance with all requirements of Law
(including Environmental Laws) applicable to it or to its properties, except for
any such failure to comply which could not reasonably be expected to cause a
Material Adverse Effect. Except as disclosed in Schedule 5.10, to the knowledge
of the Credit Parties, none of the Group Companies or any of their respective
material properties or assets is subject to or in default with respect to any
judgment, writ, injunction, decree or order of any court or other Governmental
Authority which, individually or in the aggregate, could reasonably be expected
to result in a Material Adverse Effect. Except as disclosed in Schedule 5.10,
none of the Group Companies has
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received any written communication from any Governmental Authority that alleges
that any of the Group Companies is not in compliance in any material respect
with any Law, except for allegations that have been satisfactorily resolved and
are no longer outstanding or which, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.
SECTION 5.11 EMPLOYEE BENEFIT ARRANGEMENTS.
(a) ERISA. Except as disclosed in Schedule 5.11:
(i) Except as could not reasonably be expected to have a
Material Adverse Effect, there are no Unfunded Liabilities (A) with
respect to any member of the Group Companies and (B) with respect to any
ERISA Affiliates; provided that for purposes of this Section 5.11(a)(i)(B)
only, Unfunded Liabilities shall mean the amount (if any) by which the
projected benefit obligation exceeds the value of the plan's assets as of
its last valuation date.
(ii) Each Plan complies in all respects with the applicable
requirements of ERISA and the Code, and each Group Company complies in all
respects with the applicable requirements of ERISA and the Code with
respect to all Multiemployer Plans to which it contributes, except to the
extent that the failure to comply therewith would not reasonably be
expected to have a Material Adverse Effect.
(iii) Except to the extent that such ERISA Event could not
reasonably be expected to have a Material Adverse Effect, no ERISA Event
has occurred or, subject to the passage of time, is reasonably expected to
occur with respect to any Plan and, except to the extent that such ERISA
Event would not reasonably be expected to have a Material Adverse Effect,
no ERISA Event has occurred or, subject to the passage of time, is
reasonably expected to occur with respect to any Plan maintained or
formerly maintained by an ERISA Affiliate.
(iv) No Group Company: (A) is or has been within the last six
years a party to any Multiemployer Plan; or (B) has completely or
partially withdrawn from any Multiemployer Plan, except to the extent that
the participation in or withdrawal from such Multiemployer Plan could not
reasonably be expected to have a Material Adverse Effect.
(v) If any Group Company or any ERISA Affiliate incurred or
were to incur a complete or partial withdrawal (as described in Section
4203 of ERISA) from any Multiemployer Plan as of the Closing Date, the
aggregate withdrawal liability, as determined under Section 4201 of ERISA,
with respect to all such Multiemployer Plans would not exceed an amount
that could reasonably be expected to have a Material Adverse Effect.
(vi) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereunder will not involve
any transaction that is subject to the prohibitions of Section 406 of
ERISA or in connection with which taxes could be imposed pursuant to
Section 4975(c)(1)(A)-(D) of the Code, for which an exemption under ERISA
does not apply.
(vii) Except as could not reasonably be expected to have a
Material Adverse Effect, no Group Company or, to the knowledge of any
Group Company, any ERISA Affiliate has any contingent liability with
respect to any post-retirement benefit under a Welfare Plan, other than
liability for continuation coverage described in Part 6 of Title I of
ERISA.
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(viii) No Group Company has any material liability in
connection with or arising from a Foreign Pension Plan.
(b) Employee Benefit Arrangements.
(i) All liabilities under the Employee Benefit Arrangements
are (A) funded to at least the minimum level required by law or, if
higher, to the level required by the terms governing the Employee Benefit
Arrangements, (B) insured with a reputable insurance company, (C) provided
for or recognized in the financial statements most recently delivered to
the Administrative Agent pursuant to Section 6.01(c) hereof or (D)
estimated in the formal notes to the financial statements most recently
delivered to the Administrative Agent pursuant to Section 6.01(a) hereof
where such failure to fund, insure, provide for, recognize or estimate the
liabilities arising under such arrangements could reasonably be expected
to have a Material Adverse Effect.
(ii) There are no circumstances which may give rise to a
liability in relation to the Employee Benefit Arrangements which are not
funded, insured, provided for, recognized or estimated in the manner
described in clause (i) above and which could reasonably be expected to
have a Material Adverse Effect.
(iii) Each Group Company is in material compliance with all
applicable Laws, trust documentation and contracts relating to the
Employee Benefit Arrangements.
(iv) Except as set forth on Schedule 5.11, the execution and
delivery of the Acquisition Agreement and the consummation of the
transactions contemplated thereby (i) does not require any Group Company
to make any contributions (including accelerating the timing of
contributions) in respect of the Hillman Companies Inc. Non-Qualified
Deferred Compensation Plan and (ii) does not otherwise increase the
liability of any Group Company under such plan.
SECTION 5.12 SUBSIDIARIES. Schedule 5.12 sets forth a complete and
accurate list as of the Closing Date of all Subsidiaries of Holdings. Schedule
5.12 sets forth as of the Closing Date the jurisdiction of formation of each
such Subsidiary, whether each such Subsidiary is a Subsidiary Guarantor, the
number of authorized shares of each class of Equity Interests of each such
Subsidiary, the number of outstanding shares of each class of Equity Interests,
the number and percentage of outstanding shares of each class of Equity
Interests of each such Subsidiary owned (directly or indirectly) by any Person
and the number and effect, if exercised, of all Equity Equivalents with respect
to Capital Stock of each such Subsidiary. All the outstanding Equity Interests
of each Subsidiary of Holdings are validly issued, fully paid and non-assessable
and were not issued in violation of the preemptive rights of any shareholder
and, as of the Closing Date, are owned by Holdings, directly or indirectly, free
and clear of all Liens (other than those arising under the Collateral
Documents). Other than as set forth on Schedule 5.12, as of the Closing Date, no
such Subsidiary has outstanding any Equity Equivalents nor does any such Person
have outstanding any rights to subscribe for or to purchase or any options for
the purchase of, or any agreements providing for the issuance (contingent or
otherwise) of, or any calls, commitments or claims of any character relating to,
its Equity Interests. Holdings has no Subsidiaries, other than Intermediate
Holdings, the Borrower and its Subsidiaries.
SECTION 5.13 GOVERNMENTAL REGULATIONS, ETC.
(a) None of Holdings and its Subsidiaries is engaged principally,
or as one of its important activities, in the business of extending credit for
the purpose of purchasing or carrying "margin stock" within the meaning of
Regulation U. No part of the Letters of Credit or proceeds of the Loans will be
used, directly or indirectly, for the purpose of purchasing or carrying any
"margin stock" within the
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meaning of Regulation U. If requested by any Lender or the Administrative Agent,
the Borrower will furnish to the Administrative Agent and each Lender a
statement to the foregoing effect in conformity with the requirements of FR Form
U-1 referred to in Regulation U. No indebtedness being reduced or retired out of
the proceeds of the Loans was or will be incurred for the purpose of purchasing
or carrying any margin stock within the meaning of Regulation U or any "margin
security" within the meaning of Regulation T. "Margin stock" within the meaning
of Regulation U does not constitute more than 25% of the value of the
consolidated assets of Holdings and its Consolidated Subsidiaries. None of the
transactions contemplated by this Agreement (including the direct or indirect
use of the proceeds of the Loans) will violate or result in a violation of the
Securities Act, the Exchange Act, or Regulation T, U or X.
(b) None of the Group Companies is subject to regulation under the
Public Utility Holding Company Act of 1935, the Federal Power Act or the
Investment Company Act of 1940, each as amended. In addition, none of the Group
Companies is (i) an "investment company" registered or required to be registered
under the Investment Company Act of 1940, as amended, (ii) controlled by such a
company, or (iii) a "holding company", a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary" of a
"holding company", within the meaning of the Public Utility Holding Company Act
of 1934, as amended.
SECTION 5.14 PURPOSE OF LOANS AND LETTERS OF CREDIT. The proceeds of
the Term B Loans and any Revolving Loans made on the Closing Date will be used
solely to fund a portion of the consideration paid pursuant to the Acquisition
Agreement, to refinance existing Debt of Holdings and its Subsidiaries, and to
pay fees and expenses incurred in connection with the transactions contemplated
by the Acquisition Agreement. The proceeds of the Revolving Loans and Swingline
Loans made on and after the Closing Date will be used solely to provide for the
working capital requirements of the Borrower and its Subsidiaries and for the
general corporate purposes of the Borrower and its Subsidiaries. The Letters of
Credit shall be used only for or in connection with appeal bonds, reimbursement
obligations arising in connection with surety and reclamation bonds,
reinsurance, domestic or international trade transactions and other obligations
relating to transactions entered into by the Borrower and its Subsidiaries in
the ordinary course of business and for the general corporate purposes of the
Borrower and its Subsidiaries.
SECTION 5.15 LABOR MATTERS. There are no strikes against Holdings or
any of its Subsidiaries, other than any strikes that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect. The hours worked and payments made to employees of Holdings and its
Subsidiaries have not been in violation in any material respect of the Fair
Labor Standards Act or any other applicable Law dealing with such matters,
except to the extent any such violation or violations, could not, individually
or in the aggregate, reasonably be expected to result in a Material Adverse
Effect. All payments due from Holdings or any of its Subsidiaries, or for which
any claim may be made against Holdings or any of its Subsidiaries, 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 the Borrower and its
Subsidiaries, as applicable. The consummation of the Transactions will not give
rise to a right of termination or right of renegotiation on the part of any
union under any collective bargaining agreement to which Holdings or any of its
Subsidiaries is a party or by which Holdings or any of its Subsidiaries (or any
predecessor) is bound, other than collective bargaining agreements which,
individually or in the aggregate, are not material to Holdings and its
Subsidiaries taken as a whole.
SECTION 5.16 ENVIRONMENTAL MATTERS. Except as disclosed on Schedule
5.16, no Group Company 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 or is subject to any Environmental Liability which,
in any of the foregoing cases, individually or collectively, could
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reasonably be expected to result in a Material Adverse Effect, or has received
notice of any claim with respect to any Environmental Liability, or knows of any
basis for any Environmental Liability against any Group Company, in either case
which, individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
SECTION 5.17 INTELLECTUAL PROPERTY. (a) Part A of Schedule 5.17 (as
such schedule may be amended or supplemented from time to time) sets forth a
true and complete list of (i) all United States and foreign registrations of and
applications for Patents, Trademarks, domain names and Copyrights owned by
Holdings and its domestic Subsidiaries and all material United States and
foreign registrations of and applications for Patents, Trademarks, domain names
and Copyrights owned by Foreign Subsidiaries of Holdings, and (ii) all Licenses
material to the business of the Borrower and its Subsidiaries.
(b) Holdings and its Subsidiaries own, or possess the right to
use, all of the Trademarks, service marks, trade names, Copyrights, Patents,
Patent rights, franchises, Licenses and other rights that are reasonably
necessary for the operation of their respective businesses, without conflict
with the rights of any other Person, except to the extent the failure to own or
possess the right to use any such Intellectual Property could not reasonably be
expected to have a Material Adverse Effect.
(c) To the best knowledge of Holdings and the Borrower, no
Trademark, slogan or other advertising device, product, process, method,
substance, part or other material now employed, or now contemplated to be
employed, by the Borrower or any Subsidiary infringes upon any rights held by
any other Person, except to the extent any such infringement, individually or in
the aggregate, could not reasonably be expected to have a Material Adverse
Effect.
(d) Holdings, the Borrower and their Subsidiaries have taken all
action to maintain and preserve their rights in the Intellectual Property owned
by Holdings, the Borrower and their Subsidiaries, including without limitation
paying all renewal, maintenance, and other fees and taxes required to maintain
each and every registration and application of Intellectual Property in full
force and effect, except to the extent such action or proceeding would not have
a Material Adverse Effect.
(e) The Intellectual Property material to the business of
Holdings, the Borrower and their Subsidiaries is valid and enforceable in all
material respects, and no holding, decision, or judgment has been rendered in
any action or proceeding before any court or administrative authority
challenging the validity of Holdings or the Borrower's or their Subsidiaries'
right to register, or Holdings or the Borrower's or their Subsidiaries' rights
to own or use any Intellectual Property, and no such action or proceeding is
pending or, to Holdings or the Borrower's and their Subsidiaries' knowledge,
threatened, except as disclosed in Part E of Schedule 5.17 or except to the
extent the failure to do so would not have a Material Adverse Effect.
(f) All registrations and applications for Copyrights, Patents and
Trademarks are standing in the name of the Borrower or one of its Subsidiaries,
and no material Intellectual Property has been licensed by Holdings, the
Borrower or their Subsidiaries to any third party, except in the ordinary course
of business (such Licenses in effect on the Closing Date being as disclosed in
Part F of Schedule 5.17).
SECTION 5.18 SOLVENCY. Each of Holdings and its Consolidated
Subsidiaries (on a consolidated basis) and the Borrower and its Consolidated
Subsidiaries (on a consolidated basis) is and, after consummation of the
Transactions, will be Solvent.
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SECTION 5.19 DISCLOSURE. No information, or data (excluding
financial projections, budgets, estimates and general market data) made by any
Credit Party in any Senior Finance Document or furnished to the Administrative
Agent or any Lender by or on behalf of any Credit Party in connection with any
Senior Finance Document, when taken as a whole as of the date furnished contains
any untrue statement of a material fact or omits any material fact necessary to
make the statements therein, in light of the circumstances under which they were
made, not materially misleading in light of the circumstances under which such
statements were made; provided that (i) to the extent any such statement,
information or report therein was based upon or constitutes a forecast or
projection, the Borrower represents only that it acted in good faith and
utilized assumptions believed by it to be reasonable at the time made (it being
understood and agreed that projections as to future events are not to be viewed
as facts or guaranties of future performance, that actual results during the
period or periods covered by such projections may differ from the projects
results and that such differences may be material and that the Credit Parties
make no representation that such representations will in fact be realized) and
(ii) as to statements, information and reports specified as having been supplied
by third parties, other than Affiliates of the Borrower or any of its
Subsidiaries, the Borrower represents only that it is not aware of any material
misstatement or omission therein.
SECTION 5.20 COLLATERAL DOCUMENTS.
(a) Article 9 Collateral. Each of the Security Agreement and the
Pledge Agreement is effective to create in favor of the Collateral Agent, for
the ratable benefit of the Finance Parties, a valid and enforceable security
interest in the Collateral described therein and, when financing statements in
appropriate form are filed in the offices specified on Schedule 4.01 to the
Security Agreement and the Pledged Collateral is delivered to the Collateral
Agent, each of the Security Agreement and the Pledge Agreement shall constitute
a fully perfected Lien on, and security interest in, all right, title and
interest of the grantors thereunder in such of the Collateral in which a
security interest can be perfected under Article 9 of the Uniform Commercial
Code, in each case prior in right to any other Person, other than with respect
to Permitted Liens.
(b) Intellectual Property. When financing statements in
appropriate form are filed in the offices specified on Schedule 4.01 to the
Security Agreement, the Assignment of Patents and Trademarks, substantially in
the form of Exhibit A to the Security Agreement, is filed in the United States
Patent and Trademark Office and the Assignment of Copyrights, substantially in
the form of Exhibit B to the Security Agreement, is filed in the United States
Copyright Office, the Security Agreement shall constitute a fully perfected Lien
on, and security interest in, all right, title and interest of the grantors
thereunder in the United States trademarks, copyrights, patents, licenses and
other intellectual property rights covered in such Assignments, in each case
prior in right to any other Person (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 Credit Parties
after the Closing Date).
(c) Real Property Mortgages. The Mortgages are effective to create
in favor of the Collateral Agent, for the ratable benefit of the Finance
Parties, a legal, valid and enforceable Lien on all of the right, title and
interest of the Credit Parties in and to the Mortgaged Properties thereunder and
the proceeds thereof, and when the Mortgages are filed in the offices specified
on Schedule 5.20(c), the Mortgages shall constitute a fully perfected Lien on,
and security interest in, all right, title and interest of the Credit Parties in
such Mortgaged Properties and the proceeds thereof, in each case prior in right
to any other Person, other than with respect to Permitted Liens.
(d) Status of Liens. The Collateral Agent, for the ratable benefit
of the Finance Parties, will at all times have the Liens provided for in the
Collateral Documents and, subject to the filing
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by the Collateral Agent of continuation statements to the extent required by the
Uniform Commercial Code, the Collateral Documents will at all times constitute
valid and continuing liens of record and first priority perfected security
interests in all the Collateral referred to therein, except as priority may be
affected by Permitted Liens. As of the Closing Date, no filings or recordings
are required in order to perfect the security interests created under the
Collateral Documents, except for filings or recordings listed on Schedule 4.01
to the Security Agreement.
SECTION 5.21 OWNERSHIP.
(a) Securities of the Borrower. Intermediate Holdings owns good,
valid and insurable legal title to all the outstanding common stock of the
Borrower, free and clear of all Liens of every kind, whether absolute, matured,
contingent or otherwise, other than those arising under the Collateral
Documents. Except as set forth on Schedule 5.21, there are no shareholder
agreements or other agreements pertaining to Intermediate Holdings' beneficial
ownership of the common stock of the Borrower, including any agreement that
would restrict Intermediate Holdings' right to dispose of such common stock
and/or its right to vote such common stock.
(b) Holdings Equity Interests. Schedule 5.21 sets forth a true and
accurate list as of the Closing Date of each holder of any Equity Interest or
Equity Equivalent of Holdings, indicating the name of each such holder and the
Equity Interest or Equity Equivalent held by each such Person. Except as set
forth on Schedule 5.21, as of the Closing Date there are no shareholders
agreements or other agreements pertaining to the Investor Group's beneficial
ownership of the common stock of Holdings, including any agreement that would
restrict the Investor Group's right to dispose of such common Equity Interests
and/or its right to vote such common Equity Interests.
SECTION 5.22 CERTAIN TRANSACTIONS.
(a) Acquisition Agreement. On the Closing Date, (i) the
Acquisition Agreement has not been amended or modified, nor has any material
condition thereof been waived by Holdings or the Borrower, (ii) all conditions
to the obligations of Holdings and the Borrower to consummate the transactions
contemplated by the Acquisition Agreement have been satisfied or waived in
accordance with Section 4.01(h), (iii) all funds advanced on the Closing Date by
the Lenders have been used in accordance with Section 5.14 and (iv) the
transactions contemplated by the Acquisition Agreement have been consummated in
accordance with the Acquisition Agreement in all material respects and all
applicable requirements of Law.
(b) Subordinated Debentures and Junior Debentures. On the Closing
Date, (i) neither the Subordinated Debentures Documents nor the Junior
Debentures Documents have been amended or modified, (ii) nor has any condition
thereof been waived by the Borrower in a manner adverse in any material respect
to the rights or interests of the Lenders, and (iii) all funds advanced by the
Subordinated Debentures Holder, have been used to consummate the transactions
contemplated by the Acquisition Agreement.
(c) No Broker's Fees. Except as disclosed on Schedule 5.22, no
broker's or finder's fee or commission will be payable with respect to this
Agreement or any of the transactions contemplated hereby as a result of any
action by or on behalf of the Borrower or their Affiliates, and each of Holdings
and the Borrower hereby indemnifies each Agent and each Lender against, and
agrees that it will hold each Agent and each Lender harmless from, any claim,
demand or liability for any such broker's or finder's fees alleged to have been
incurred in connection herewith or therewith and any expenses (including
reasonable fees, expenses and disbursements of counsel) arising in connection
with any such claim, demand or liability.
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ARTICLE VI
AFFIRMATIVE COVENANTS
Each of Holdings, Intermediate Holdings and the Borrower agrees that
so long as any Lender has any Commitment hereunder, any Senior Obligation or
other amount payable hereunder or under any Note or other Senior Finance
Document or any LC Obligation (in each case other than contingent
indemnification obligations) remains unpaid or any Letter of Credit remains in
effect:
SECTION 6.01 INFORMATION. The Borrower will furnish, or cause to be
furnished, to the Administrative Agent for delivery to each of the Lenders:
(a) Annual Financial Statements. As soon as available, and in any
event within 90 days after the end of each fiscal year of the Borrower, a
consolidated balance sheet and income statement of Holdings and its Consolidated
Subsidiaries, as of the end of such fiscal year, and the related consolidated
statement of operations and retained earnings and consolidated statement of cash
flows for such fiscal year, setting forth in comparative form consolidated
figures for the preceding fiscal year and corresponding figures from the annual
forecast, all such financial statements to be in reasonable form and detail and
(in the case of such consolidated financial statements) audited by independent
certified public accountants of recognized national standing reasonably
acceptable to the Lead Arrangers and accompanied by an opinion of such
accountants (which shall not be qualified or limited in any material respect) to
the effect that such consolidated financial statements have been prepared in
accordance with GAAP and present fairly in all material respects the
consolidated financial position and consolidated results of operations and cash
flows of Holdings and its Consolidated Subsidiaries in accordance with GAAP
consistently applied (except for changes with which such accountants concur) and
accompanied by a written statement by the accountants reporting on compliance
with this Agreement to the effect that in the course of the audit upon which
their opinion on such financial statements was based (but without any special or
additional audit procedures for the purpose), they obtained knowledge of no
condition or event relating to financial matters which constitutes a Default or
an Event of Default or, if such accountants shall have obtained in the course of
such audit knowledge of any such Default or Event of Default, disclosing in such
written statement the nature and period of existence thereof, it being
understood that such accountants shall be under no liability, directly or
indirectly, to the Lenders for failure to obtain knowledge of any such condition
or event.
(b) Quarterly Financial Statements. As soon as available, and in
any event within 45 days after the end of each of the first three fiscal
quarters in each fiscal year of the Borrower, a consolidated balance sheet of
Holdings and its Consolidated Subsidiaries as of the end of such fiscal quarter,
together with related consolidated statement of operations and retained earnings
and consolidated statement of cash flows for such fiscal quarter and the then
elapsed portion of such fiscal year, setting forth in comparative form
consolidated figures for the corresponding periods of the preceding fiscal year
and the annual forecast, all such financial statements to be in form and detail
and reasonably acceptable to the Administrative Agent, and accompanied by a
certificate of the chief financial officer of the Borrower to the effect that
such quarterly financial statements have been prepared in accordance with GAAP
and present fairly in all material respects the consolidated financial position
and consolidated results of operations and cash flows of Holdings and its
Consolidated Subsidiaries in accordance with GAAP consistently applied, subject
to changes resulting from normal year-end audit adjustments and the absence of
footnotes required by GAAP.
(c) Monthly Financial Statements. As soon as available, and in any
event within 30 days after the end of each month in each fiscal year of the
Borrower, a consolidated balance sheet of Holdings and its Consolidated
Subsidiaries as of the end of such month, together with related consolidated
statement of operations and retained earnings and consolidated statement of cash
flows for
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such month and the then elapsed portion of such fiscal year, setting forth in
comparative form consolidated figures for the corresponding periods of the
preceding fiscal year and the annual forecast, all such financial statements to
be in form and detail and reasonably acceptable to the Lenders, and accompanied
by a certificate of the chief financial officer of the Borrower to the effect
that such monthly financial statements have been prepared in accordance with
GAAP and present fairly in all material respects the consolidated financial
position and consolidated results of operations and cash flows of Holdings and
its Consolidated Subsidiaries in accordance with GAAP consistently applied,
subject to changes resulting from normal year-end audit adjustments and the
absence of footnotes required by GAAP.
(d) Officer's Certificate. At the time of delivery of the
financial statements provided for in Sections 6.01(a) and 6.01(b) above, a
certificate of the chief financial officer or other appropriate Responsible
Officer of the Borrower (i) demonstrating compliance with the financial
covenants contained in Section 7.17 by calculation thereof as of the end of the
fiscal period covered by such financial statements, (ii) stating that no Default
or Event of Default exists, or if any Default or Event of Default does exist,
specifying the nature and extent thereof and what action the Borrower and the
other Credit Parties propose to take with respect thereto and (iii) stating
whether, since the date of the most recent financial statements delivered
hereunder, there has been any material change in the GAAP applied in the
preparation of the financial statements of Holdings and its Consolidated
Subsidiaries, and, if so, describing such change. At the time such certificate
is required to be delivered, the Borrower shall promptly deliver to the
Administrative Agent, at the Administrative Office, information regarding any
change in the Leverage Ratio that would change the then existing Applicable
Margin.
(e) Annual Business Plan and Budgets. At least 90 days after the
end of each fiscal year of the Borrower, beginning with the delivery of the
business plan and budget for the fiscal year ending December 31, 2005 within 90
days of the end of the fiscal year ending December 31, 2004, an annual business
plan and budget of Holdings and its Consolidated Subsidiaries containing, among
other things, projected financial statements for the then-current fiscal year.
(f) Excess Cash Flow. Within 120 days after the end of each fiscal
year of the Borrower, commencing with the fiscal year ending December 31, 2004,
a certificate of the chief financial officer of the Borrower containing
information regarding the calculation of Excess Cash Flow for such fiscal year.
(g) Auditor's Reports. Within five Business Days of receipt
thereof, a copy of any other final report or "management letter" submitted by
independent accountants to Holdings, the Borrower or any of their respective
Subsidiaries in connection with any annual, interim or special audit of the
books of Holdings, the Borrower or any of their respective Subsidiaries.
(h) Reports. Promptly upon transmission or receipt thereof, copies
of all filings and registrations with, and reports to or from, the Securities
and Exchange Commission, or any successor agency, and copies of all financial
statements, proxy statements, notices and reports any Group Company shall send
to its shareholders generally or to a holder of the Subordinated Debentures or
the Junior Debentures or holders of any other Debt (excluding Capital Leases)
owed by any Group Company where the outstanding amount of principal and interest
in respect of such other Debt exceeds $5,000,000, in their capacity as such a
holder.
(i) Notices. Prompt notice of: (i) the occurrence of any Default
or Event of Default; (ii) any matter that has resulted or may result in a
Material Adverse Effect, including (A) breach or non-performance of, or any
default under, any material agreement of Holdings or any of its Subsidiaries;
(B) any dispute, litigation, investigation, proceeding or suspension between
Holdings or any of its
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Subsidiaries and any Governmental Authority; (C) the commencement of, or any
material adverse development in, any litigation or proceeding affecting Holdings
or any of its Subsidiaries, including pursuant to any applicable Environmental
Law; (D) any litigation, investigation or proceeding affecting any Credit Party
in which the amount involved exceeds $5,000,000, or in which injunctive relief
or similar relief is sought, which relief, if granted, could be reasonably
expected to have a Material Adverse Effect; and (E) any material change in
accounting policies or financial reporting practice by Holdings or any of its
Subsidiaries. Each notice pursuant to this Section 6.01(h) shall (i) be
accompanied by a statement of a Responsible Officer of the Borrower setting
forth details of the occurrence referred to therein and stating what action the
Borrower or any other Credit Party has taken and proposes to take with respect
thereto and (ii) describe with particularity any and all provisions of this
Agreement or the other Senior Finance Documents that have been breached.
(j) Employee Benefits Arrangements. (i) The Borrower will give
written notice to the Administrative Agent promptly (and in any event within
five Business Days after any officer of any Group Company obtains knowledge
thereof) of: (A) any event or condition that constitutes, or is reasonably
likely to lead to, an ERISA Event; (B) any change in the funding status of any
Plan that could reasonably be expected to have a Material Adverse Effect,
together with a description of any such event or condition or a copy of any such
notice and a statement by the chief financial officer of the Borrower briefly
setting forth the details regarding such event, condition or notice and the
action, if any, which has been or is being taken or is proposed to be taken by
the Borrower and the other Credit Parties with respect thereto; or (C) any event
or condition that constitutes, or is reasonably likely to lead to, an event
described in Section 8.01(h)(iii)-(viii). Promptly upon request, the Borrower
shall furnish the Administrative Agent and the Lenders with such additional
information concerning any Plan or Employee Benefit Arrangement as may be
reasonably requested, including, but not limited to, with respect to any Plans,
copies of each annual report/return (Form 5500 series), as well as all schedules
and attachments thereto required to be filed with the Department of Labor and/or
the Internal Revenue Service pursuant to ERISA and the Code, respectively, for
each "plan year" (within the meaning of Section 3(39) of ERISA) of each Plan;
and (ii) the Borrower will promptly deliver to the Administrative Agent the most
recently prepared actuarial reports in relation to the Employee Benefit
Arrangements for the time being operated by Group Companies which are prepared
in order to comply with the then current statutory or auditing requirements
within the relevant jurisdiction.
(k) Domestication in Other Jurisdiction. Not less than 20 days
prior to any change in the jurisdiction of organization of any Credit Party, a
copy of all documents and certificates intended to be filed or otherwise
executed to effect such change.
(l) Other Information. With reasonable promptness upon request
therefor, such other information regarding the business, properties or financial
condition of any Group Company as the Administrative Agent or any other Finance
Party may reasonably request, which may include such information as any Senior
Finance Party may reasonably determine is necessary or advisable to enable it
either (i) to comply with the policies and procedures adopted by it and its
Affiliates to comply with the Bank Secrecy Act, the U.S. Patriot Act and all
applicable regulations thereunder or (ii) to respond to requests for information
concerning Holdings and its Subsidiaries from any government, self-regulatory
organization or financial institution in connection with its anti-money
laundering and anti-terrorism regulatory requirements or its compliance
procedures under the U.S. Patriot Act, including in each case information
concerning the Borrower's direct and indirect shareholders and its use of the
proceeds of the Credit Extensions hereunder.
SECTION 6.02 PRESERVATION OF EXISTENCE AND FRANCHISES. Except as a
result of or in connection with a dissolution, merger or disposition of a
Subsidiary of the Borrower permitted under Section 7.04 or Section 7.05, each
Group Company will do all things necessary to preserve and keep in
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full force and effect its legal existence and do or cause to be done all things
necessary to obtain, preserve, renew, extend and keep in full force and effect
the rights, licenses, permits, franchises, authorizations, patents, copyrights,
trademarks and trade names material to the conduct of its business and to
maintain and operate such business in substantially the manner in which it is
presently conducted and operated; provided, however, that neither Holdings nor
any of its Subsidiaries shall be required to preserve any such rights, licenses,
permits, franchises, authorizations or Intellectual Property if the preservation
thereof is no longer desirable in the conduct of the business of the Borrower
and its Subsidiaries or the loss thereof could not reasonably be expected to
result in a Material Adverse Effect.
SECTION 6.03 BOOKS AND RECORDS; LENDER MEETING. Each of the Group
Companies will keep complete and accurate books and records of its transactions
in accordance with good accounting practices on the basis of GAAP (including the
establishment and maintenance of appropriate reserves). At the request of the
Administrative Agent, within 110 days after the end of each fiscal year of the
Borrower, the Borrower will conduct a meeting (which may be by telephone) of the
Lenders to discuss such fiscal year's results and the financial condition of
Holdings and its Consolidated Subsidiaries. Such meetings shall be held at times
and places convenient to the Lenders and to the Borrower.
SECTION 6.04 COMPLIANCE WITH LAW; EMPLOYEE BENEFIT ARRANGEMENTS.
Each of the Group Companies will comply with all requirements of Law applicable
to it and its properties to the extent that noncompliance with any such
requirement of Law could reasonably be expected to have a Material Adverse
Effect. Without limiting the generality of the foregoing, each of the Group
Companies will do each of the following as it relates to any Plan, Foreign
Pension Plan or Employee Benefit Arrangement, except to the extent that failure
to do any of the following could not reasonably be expected to have a Material
Adverse Effect: (i) maintain each Plan, Foreign Pension Plan and Employee
Benefit Arrangement in compliance in all material respects with the applicable
provisions of ERISA, the Code or other Federal, state or foreign law; (ii) cause
each Plan which is qualified under Section 401(a) of the Code to maintain such
qualifications; (iii) make all required contributions to any Plan subject to
Section 412 of the Code and make all required contributions to Multiemployer
Plans; (iv) ensure that there are no Unfunded Liabilities in excess of an amount
that could reasonably be expected to have a Material Adverse Effect; (v) except
for the obligations set forth on Schedule 5.11, not become a party to any
Multiemployer Plan; (vi) make all contributions (including any special payments
to amortize any Unfunded Liabilities) required to be made in accordance with all
applicable laws and the terms of each Foreign Pension Plan in a timely manner;
(vii) ensure that all liabilities under the Employee Benefit Arrangements are
either (A) funded to at least the minimum level required by Law or, if higher,
to the level required by the terms governing the Employee Benefit Arrangements;
(B) insured with a reputable insurance company; (C) provided for or recognized
in the accounts most recently delivered to the Administrative Agent under
Section 6.01(c); or (D) estimated in the formal notes to the accounts most
recently delivered to the Administrative Agent under Section 6.01(a); (viii)
ensure that the contributions or premium payments to or in respect of all
Employee Benefit Arrangements are and continue to be promptly paid at no less
than the rates required under the rules of such arrangements and in accordance
with the most recent actuarial advice received in relation to the Employee
Benefit Arrangement and generally in accordance with applicable law; and (ix)
shall use its reasonable efforts to cause each ERISA Affiliate to do each of the
items listed in clauses (i) through (iv) above as it relates to Plans maintained
by or contributed to by such ERISA Affiliate.
SECTION 6.05 PAYMENT OF TAXES. Each of the Group Companies will pay
and discharge (i) all taxes, assessments and other governmental charges or
levies imposed upon it, or upon its income or profits, or upon any of its
properties, before they shall become delinquent and (ii) all lawful claims
(including claims for labor, materials and supplies) which, if unpaid, might
give rise to a Lien (other than a Permitted Lien) upon any of its properties;
provided, however, that no Group Company shall be required to pay any such tax,
assessment, charge, levy or claim (i) which is being contested in good
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faith by appropriate proceedings diligently pursued and as to which adequate
reserves have been established in accordance with GAAP, (ii) in respect of
immaterial, state, local or foreign taxes, or (iii) unless the failure to make
any such payment (A) could give rise to an immediate right to foreclose on a
Lien securing such amounts (unless proceedings thereto conclusively operate to
stay such foreclosure) or (B) could reasonably be expected to have a Material
Adverse Effect.
SECTION 6.06 INSURANCE; CERTAIN PROCEEDS.
(a) Insurance Policies. Each of the Group Companies will at all
times maintain in full force and effect insurance (including worker's
compensation insurance, liability insurance or casualty insurance) in such
amounts, covering such risk and liabilities and with such deductibles or
self-insurance retentions as are in accordance with normal industry practice or
otherwise consistent with past practice of the Group Companies or prudent in the
reasonable business judgment of the senior management of the Borrower. The
Collateral Agent shall be named as loss payee or mortgagee, as its interest may
appear, with respect to all such property and casualty policies and additional
insured with respect to all such other policies (other than workers'
compensation, employee health and directors and officers policies), and each
provider of any such insurance shall agree, by endorsement upon the policy or
policies issued by it or by independent instruments furnished to the Collateral
Agent, that if the insurance carrier shall have received written notice from the
Collateral Agent of the occurrence and continuance of an Event of Default, the
insurance carrier shall pay all proceeds otherwise payable to Holdings or one or
more of its Subsidiaries under such policies directly to the Collateral Agent
(which agreement shall be evidenced by a "standard" or "New York" lender's loss
payable endorsement in the name of the Collateral Agent on Accord Form 27) and
that it will give the Collateral Agent 30 days' prior written notice before any
such policy or policies shall be altered or canceled, and that no act or default
of any Group Company or any other Person shall affect the rights of the
Collateral Agent or the Lenders under such policy or policies.
(b) Loss Events. In case of any Casualty or Condemnation with
respect to any property of any Group Company or any part thereof in excess of
$1,000,000, the Borrower shall promptly give written notice thereof to the
Administrative Agent generally describing the nature and extent of such damage,
destruction or taking. The Borrower shall, or shall cause such Group Company to,
repair, restore or replace the property of such Person (or part thereof) which
was subject to such Casualty or Condemnation, at such Person's cost and expense,
whether or not the Insurance Proceeds or Condemnation Award, if any, received on
account of such event shall be sufficient for that purpose; provided, however,
that such property need not be repaired, restored or replaced to the extent the
failure to make such repair, restoration or replacement (i) is desirable to the
proper conduct of the business of such Person in the ordinary course and
otherwise in the best interest of such Person or (ii) the failure to repair,
restore or replace the property is attributable to the contemplated application
of the Insurance Proceeds from such Casualty or the Condemnation Award from such
Condemnation to the acquisition of other tangible assets used or useful in the
business of the Borrower and its Subsidiaries as contemplated in the definition
of "Reinvestment Funds" in Section 1.01 or to payment of the Senior Obligations
in accordance with the provisions of Section 2.09(b)(iv).
(c) Certain Rights of the Lenders. In connection with the
covenants set forth in this Section 6.06, it is understood and agreed that none
of the Agents, the Lenders or their respective agents or employees shall be
liable for any loss or damage insured by the insurance policies required to be
maintained under this Section 6.06, it being understood that the Group Companies
shall look solely to their insurance companies or any other parties other than
the aforesaid parties for the recovery of such loss or damage.
SECTION 6.07 MAINTENANCE OF PROPERTY. Each of the Group Companies
will maintain and preserve its properties and equipment material to the conduct
of its business in good repair, working
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order and condition, normal wear and tear and Casualty and Condemnation
excepted, and will make, or cause to be made, as to such properties and
equipment from time to time all repairs, renewals, replacements, extensions,
additions, betterments and improvements thereto as may be needed or proper in
the reasonable good faith business judgment of the Responsible Officers of such
Group Companies.
SECTION 6.08 USE OF PROCEEDS. The Borrower will use the proceeds of
the Loans and will use the Letters of Credit solely for the purposes set forth
in Section 5.14.
SECTION 6.09 AUDITS/INSPECTIONS. Upon reasonable notice and during
normal business hours, each of the Group Companies will permit representatives
appointed by the Agents or the Required Lenders to visit and inspect its
executive offices and/or manufacturing facilities and, following the occurrence
and during the continuance of any Event of Default, any of its properties, to
review and inspect its books and records, accounts receivable and inventory, and
to make photocopies or photographs thereof and to write down and record any
information such representatives obtain and shall permit the Agents or such
representatives to investigate and verify the accuracy of information provided
to the Lenders and to discuss all such matters with the officers, employees,
independent accountants and representatives of the Group Companies, in each case
so long as a Responsible Officer has been given the opportunity to be present;
provided, however, that prior to the occurrence and continuance of an Event of
Default, such visits shall be limited to one per year per location, and the
Group Companies shall not be obligated to reimburse the expenses of more than
two representatives of the Administrative Agent and the Lenders in the
aggregate.
SECTION 6.10 ADDITIONAL CREDIT PARTIES; ADDITIONAL SECURITY.
(a) Additional Subsidiary Guarantors. Each of Holdings and the
Borrower will take, and will cause each of its Subsidiaries (other than Foreign
Subsidiaries, except to the extent provided in subsection (d) below) to take,
such actions from time to time as shall be necessary to ensure that all
Subsidiaries of Holdings (other than the Borrower and Foreign Subsidiaries,
except to the extent provided in subsection (d) below) are Subsidiary
Guarantors. Without limiting the generality of the foregoing, if any Group
Company shall form or acquire any new Subsidiary, the Borrower, as soon as
practicable and in any event within 30 days after such formation or acquisition,
will provide the Collateral Agent with notice of such formation or acquisition
setting forth in reasonable detail a description of all of the assets of such
new Subsidiary and will cause such new Subsidiary (other than a Foreign
Subsidiary, except to the extent provided in subsection (d) below) to:
(i) within 30 days after such formation or acquisition,
execute an Accession Agreement pursuant to which such new Subsidiary shall
agree to become a "Guarantor" under the Guaranty, an "Obligor" under the
Security Agreement, an "Obligor" under the U.S. Pledge Agreement and/or an
obligor under such other Collateral Documents as may be applicable to such
new Subsidiary; and
(ii) deliver such proof of organizational authority,
incumbency of officers, opinions of counsel and other documents as is
consistent with those delivered by each Credit Party pursuant to Section
4.01 on the Closing Date or as the Administrative Agent, the Collateral
Agent or the Required Lenders reasonably shall have requested.
(b) Additional Security. Each of Holdings and the Borrower will
cause, and will cause each of its Subsidiaries (other than a Foreign Subsidiary,
except to the extent provided in subsection (d) below) to cause, (i) all of its
owned Real Properties and personal property located in the United States, other
that those owned Real Properties set forth on Schedule 6.10(b) and other than
owned Real Properties which are subject to a Permitted Lien the terms of which
prohibit the granting of a Lien thereon
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in favor of the Finance Parties and (ii) to the extent deemed to be material by
the Administrative Agent or the Required Lenders in its or their sole reasonable
discretion, (A) all of its personal property located in the United States
(except to the extent expressly excluded from the Collateral Documents), (B) all
of its leased Real Properties located in the United States (other than
leaseholds the terms of which prohibit the granting of a Lien thereon in favor
of the Finance Parties) and (C) all other assets and properties of Holdings and
its Domestic Subsidiaries located in the United States as are not covered by the
original Collateral Documents (or specifically excluded therefrom) and as may be
requested by the Collateral Agent or the Required Lenders in their sole
reasonable discretion to be subject at all times to first priority (subject only
to Permitted Liens), perfected and, in the case of Real Property (whether leased
or owned), title insured Liens in favor of the Collateral Agent pursuant to the
Collateral Documents or such other security agreements, pledge agreements,
mortgages or similar collateral documents as the Collateral Agent shall request
in its sole and reasonable discretion (collectively, the "Additional Collateral
Documents"). With respect to any Real Property (whether leased or owned) located
in the United States acquired or leased by any Credit Party subsequent to the
Closing Date for which the Collateral Agent is entitled to a Lien pursuant to
the preceding sentence, such Person will cause to be delivered to the Collateral
Agent with respect to such Real Property (other than immaterial leased
properties or except for properties with respect to which landlord consent for
such Mortgage cannot be obtained after commercially reasonable efforts by the
Borrower, to do so or as otherwise approved by the Administrative Agent)
documents, instruments and other items of the types required to be delivered
pursuant to Section 4.01(k), all in form, content and scope reasonably
satisfactory to the Collateral Agent. In furtherance of the foregoing terms of
this Section 6.10, the Borrower agrees to promptly provide the Administrative
Agent with written notice of the acquisition by Holdings or any of its
Subsidiaries of any Real Property located in the United States having a market
value greater than $500,000 or the entering into a lease by Holdings or any of
its Subsidiaries of any Real Property located in the United States for annual
rent of $150,000 or more, setting forth in each case in reasonable detail the
location and a description of the asset(s) so acquired or leased. Without
limiting the generality of the foregoing, Holdings and the Borrower will cause,
and will cause each of their respective Subsidiaries to cause, 100% of the
Equity Interests of each of their respective direct and indirect Subsidiaries
(or 65% of such Equity Interests, if such Subsidiary is a direct Foreign
Subsidiary, except as provided in subsection (d) below) to be subject at all
times to a first priority, perfected Lien in favor of the Collateral Agent
pursuant to the terms and conditions of the Collateral Documents, subject only
to Permitted Liens described in paragraph (ii) and/or (iv) of Section 7.02.
If, subsequent to the Closing Date, a Credit Party shall acquire any
Intellectual Property, securities, instruments, chattel paper or other personal
property required to be delivered to the Collateral Agent as Collateral under
any of the Collateral Documents, the Borrower shall promptly (and in any event
within 10 Business Days after any Responsible Officer of any Credit Party
acquires knowledge of the same) notify the Collateral Agent of the same. Each of
the Credit Parties shall adhere to the covenants regarding the location of
personal property as set forth in the Collateral Documents.
All such security interests and mortgages shall be granted pursuant
to documentation consistent with the Collateral Documents executed at Closing
and otherwise reasonably satisfactory in form and substance to the Collateral
Agent and shall constitute valid and enforceable perfected security interests
and mortgages prior to the rights of all third Persons and subject to no other
Liens except for Permitted Liens. The Additional Collateral Documents or
instruments related thereto shall have been duly recorded or filed in such
manner and in such places as are required by law to establish, perfect, preserve
and protect the Liens in favor of the Collateral Agent required to be granted
pursuant to the Additional Collateral Documents, and all taxes, fees and other
charges payable in connection therewith shall have been paid in full. The
Borrower shall cause to be delivered to the Collateral Agent such opinions of
counsel, title insurance and other related documents as may be reasonably
requested by the Collateral Agent to assure itself that this Section 6.10(b) has
been complied with.
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(c) Real Property Appraisals. If the Collateral Agent or the
Required Lenders determine that they are required by law or regulation to have
appraisals prepared in respect of the Real Property of any Group Company
constituting Collateral, the Borrower shall provide to the Collateral Agent
appraisals which satisfy the applicable requirements set forth in 12 C.F.R.,
Part 34 - Subpart C or any successor or similar statute, rule, regulation,
guideline or order, and which shall be in scope, form and substance, and from
appraisers, reasonably satisfactory to the Required Lenders and shall be
accompanied by a certification of the appraisal firm providing such appraisals
that the appraisals comply with such requirements.
(d) Foreign Subsidiaries Security. If, following a change that is
reasonably determined to be relevant by the Administrative Agent in the relevant
sections of the Code or the regulations, rules, rulings, notices or other
official pronouncements issued or promulgated thereunder, counsel for the
Borrower reasonably acceptable to the Collateral Agent and the Required Lenders
fails within 90 days after a reasonable request from the Collateral Agent and
the Required Lenders to deliver evidence, in form and substance mutually
satisfactory to the Collateral Agent and the Borrower, with respect to any
Foreign Subsidiary of Holdings which has not already had all of the Equity
Interests issued by it pledged pursuant to the Pledge Agreement that (i) a
pledge (A) of two-thirds or more of the total combined voting power of all
classes of capital stock of such Foreign Subsidiary entitled to vote, and (B) of
any promissory note issued by such Foreign Subsidiary to the Borrower or any of
its Domestic Subsidiaries, (ii) the entering into by such Foreign Subsidiary of
a guaranty in form and substance substantially similar to the Guaranty, (iii)
the entering into by such Foreign Subsidiary of a security agreement in form and
substance substantially similar to the Security Agreement, and (iv) the entering
into by such Foreign Subsidiary of a pledge agreement substantially similar to
the Pledge Agreement, in any such case would reasonably be expected to be
restricted by applicable Law of the jurisdiction of organization of such Foreign
Subsidiary or would reasonably be expected to cause the undistributed earnings
or future earnings, if any, of such Foreign Subsidiary as determined for United
States federal income tax purposes to be included as gross income of such
Foreign Subsidiary's United States parent (or other domestic Affiliate) for
United States federal income tax purposes, then, (A) in the case of a failure to
deliver the evidence described in clause (i) above, that portion of such Foreign
Subsidiary's outstanding capital stock or any promissory notes so issued by such
Foreign Subsidiary, in each case not theretofore pledged pursuant to the Pledge
Agreement, shall be pledged to the Collateral Agent for the benefit of the
Finance Parties pursuant to the Pledge Agreement (or another pledge agreement in
substantially similar form, if needed), in each case only to the extent that
such pledge would not reasonably be expected to cause the undistributed earnings
or future earnings, if any, of such Foreign Subsidiary as determined for United
States federal income tax purposes to be included in gross income of such
Foreign Subsidiary's United States parent (or other domestic Affiliate) for
United States federal income tax purposes or would not reasonably be expected to
be restricted by Applicable Law of the jurisdiction of organization of such
Foreign Subsidiary; (B) in the case of a failure to deliver the evidence
described in clause (ii) above, such Foreign Subsidiary shall execute and
deliver the Guaranty (or another guaranty in substantially similar form, if
needed), guaranteeing the Finance Obligations; (C) in the case of a failure to
deliver the evidence described in clause (iii) above, such Foreign Subsidiary
shall execute and deliver the Security Agreement (or another security agreement
in substantially similar form, if needed), granting to the Collateral Agent, for
the benefit of the Finance Parties, a security interest in all of such Foreign
Subsidiary's assets and securing the Finance Obligations; and (D) in the case of
a failure to deliver the evidence described in clause (iv) above, such Foreign
Subsidiary shall execute and deliver the Pledge Agreement (or another pledge
agreement in substantially similar form, if needed), pledging to the Collateral
Agent, for the benefit of the Finance Parties, all of the capital stock and
promissory notes owned by such Foreign Subsidiary, in each case to the extent
that entering into the Guaranty, Security Agreement or Pledge Agreement is
permitted by the Laws of the respective foreign jurisdiction and with all
documents delivered pursuant to this Section 6.10(d) to be in form, scope and
substance reasonably satisfactory to the Collateral Agent and the Required
Lenders.
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(e) Each of Holdings and the Borrower agrees that, except as
otherwise provided in this Section 6.10, each action required by this Section
6.10 shall be completed as soon as reasonably possible, but in no event later
than 90 days after such action is either requested to be taken by the Collateral
Agent or the Required Lenders or required to be taken by Holdings or any of its
Subsidiaries pursuant to the terms of this Section 6.10.
SECTION 6.11 INTEREST RATE PROTECTION AGREEMENTS. Within 90 days
after the Closing Date, the Borrower will enter into and thereafter maintain in
full force and effect interest rate swaps, rate caps, collars or other similar
agreements or arrangements designed to hedge the position of the Borrower with
respect to interest rates at rates and on terms reasonably satisfactory to the
Lead Arrangers, taking into account current market conditions, the effect of
which is that at least 50% of the Consolidated Debt of Holdings and its
Consolidated Subsidiaries will bear interest at a fixed or capped rate or the
interest cost in respect of which will be fixed or capped for a period expiring
no earlier than 24 months after the Closing Date. The Borrower will promptly
deliver evidence of the execution and delivery of such agreements to the
Administrative Agent.
SECTION 6.12 CONTRIBUTIONS. Within three Business Days following its
receipt thereof, Holdings will contribute as a common equity contribution to the
capital of Intermediate Holdings which will then contribute an equal amount to
the capital of the Borrower, any cash proceeds received by Holdings after the
Closing Date from any Asset Disposition, Casualty, Condemnation, Debt Issuance
or Equity Issuance or any cash capital contributions received by Holdings after
the Closing Date (less any Restricted Payments permitted under Section 7.07 and
made in connection with such Asset Disposition, Casualty, Condemnation, Debt
Issuance, Equity Issuance or cash capital contribution).
ARTICLE VII
NEGATIVE COVENANTS
Each of Holdings, Intermediate Holdings and the Borrower agrees that
so long as any Lender has any Commitment hereunder, any Senior Obligations or
other amount payable hereunder or under any Note or other Senior Finance
Document or any LC Obligation (in each case other than contingent
indemnification obligations) remains unpaid or any Letter of Credit remains
unexpired:
SECTION 7.01 LIMITATION ON DEBT. None of the Group Companies will
incur, create, assume or permit to exist any Debt, Derivatives Obligations or
Synthetic Lease Obligations except:
(i) Debt of the Credit Parties under this Agreement and
the other Senior Finance Documents;
(ii) Debt arising under (A) the Subordinated Debentures
Indenture and the Subordinated Debentures and (B) the Junior Debentures
Indenture and the Junior Debentures (but with respect to this clause (B)
not including any renewal, refinancing or extension thereof);
(iii) Capital Lease Obligations and Purchase Money Debt of
the Borrower and its Subsidiaries incurred after the Closing Date to
finance Capital Expenditures permitted by Section 7.14; provided that (A)
the aggregate amount of all such Debt (together with refinancing thereof
permitted by clause (v) below) does not exceed $10,000,000 at any time
outstanding, (B) the aggregate amount of all such Debt consisting of
Capital Lease Obligations (together with refinancing thereof permitted by
clause (v) below) does not exceed $7,500,000 at any time outstanding, (C)
the Debt when incurred shall not be less than 80% or more than 100% of the
lesser of the cost or fair market value as of the time of acquisition of
the asset financed, (D) such Debt is issued and any Liens securing such
Debt are created concurrently with, or within 120
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days after, the acquisition of the asset financed and (E) no Lien securing
such Debt shall extend to or cover any property or asset of any Group
Company other than the asset so financed;
(iv) Debt of the Borrower or its Subsidiaries secured by
Liens permitted by clauses (xi), (xii) and (xiii) of Section 7.02 or any
other Debt acquired or assumed in a Permitted Business Acquisition or in
connection with the acquisition of assets; provided that (A) the aggregate
principal amount of all Debt incurred or assumed pursuant to this clause
(iv) (together with refinancings thereof permitted by clause (v) below)
shall not exceed (x) in the aggregate, together with all Debt incurred
pursuant to clause (xi) below, $40,000,000 at any time outstanding and (y)
in the case of any such Debt that does not constitute unsecured
Subordinated Debt (together with all Debt incurred pursuant to subclause
(B) of the proviso to clause (xi) below), $20,000,000 at any time
outstanding, and (B) such Debt was not incurred in connection with, or in
anticipation of, the events described in such clauses;
(v) Debt (A) of the Borrower representing a refinancing,
replacement or refunding of the Subordinated Debentures and Subordinated
Debentures Indenture, (B) of Holdings representing a refinancing,
replacement or refunding of the Junior Debentures and Junior Debentures
Indenture permitted by clause (ii) above, provided that the Required
Lenders shall have given their prior written consent to such refinancing,
replacement or refunding, which consent shall not be unreasonably withheld
or delayed, or (C) of the Borrower or its Subsidiaries representing a
refinancing, replacement or refunding of Debt permitted by clause (iii) or
(iv) above, provided in each case that (A) such Debt (the "Refinancing
Debt") is an original aggregate principal amount not greater than the
aggregate principal amount of, and unpaid interest on, the Debt being
refinanced, replaced or refunded plus the amount of any premiums required
to be paid thereon and fees and expense associated therewith, (B) such
Refinancing Debt has a later or equal final maturity and a larger or equal
weighted average life than the Debt being refinanced, replaced or
refunded, (C) if the Debt being refinanced, replaced or refunded is
subordinated to the Senior Obligations, such Refinancing Debt is
subordinated to the Senior Obligations on terms no less favorable to the
Lenders than the terms of the Debt being refinanced, replaced or refunded,
(D) the covenants, events of default and any Guaranty Obligations in
respect thereof shall be no less favorable to the Lenders than those
contained in the Debt being refinanced, replaced or refunded and (E) at
the time of, and after giving effect to, such refinancing, replacement or
refunding, no Default or Event of Default shall have occurred and be
continuing;
(vi) Derivatives Obligations of the Borrower or any
Subsidiary under Derivatives Agreements to the extent entered into after
the Closing Date in compliance with Section 6.11 or to manage interest
rate or foreign currency exchange rate risks and not for speculative
purposes;
(vii) Debt owed to any Person providing property, casualty,
liability or other insurance to the Borrower or any Subsidiary of the
Borrower, so long as such Debt shall not be in excess of the amount of the
unpaid cost of, and shall be incurred only to defer the cost of, such
insurance for the year in which such Debt is incurred and such Debt shall
be outstanding only during such year;
(viii) Debt consisting of Guaranty Obligations (A) by
Holdings and Intermediate Holdings in respect of Debt incurred by the
Borrower under the Subordinated Debentures or otherwise permitted to be
incurred by the Borrower or any of its subsidiaries, provided, however,
that all such Guaranty Obligations by Holdings and Intermediate Holdings
shall be unsecured, (B) by Holdings in respect of Debt incurred by Hillman
Group Capital Trust under the Trust Preferred Securities, (C) by the
Borrower in respect of Debt permitted to be
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incurred by the Subsidiaries of the Borrower and (D) by Subsidiaries of
the Borrower of Debt permitted to be incurred by the Borrower or
Subsidiaries of the Borrower;
(ix) (A) Debt owing to the Borrower or a Subsidiary of the
Borrower to the extent permitted by Section 7.06(a)(ix), (x), (xi) or
(xxi) and (B) Debt owing by the Borrower to Holdings or Intermediate
Holdings to the extent permitted by (x) Section 7.06(a)(xi) or (y)
incurred in connection with tax planning, provided that in the case of (y)
the Administrative Agent shall have given its prior consent such consent
not to be unreasonably withheld;
(x) contingent liabilities in respect of any
indemnification, adjustment of purchase price, earn-out, incentive,
non-compete, consulting, deferred compensation and similar obligations of
Holdings and its Subsidiaries incurred in connection with the Acquisition
and Permitted Business Acquisitions;
(xi) Debt of the Borrower or any of its Subsidiaries that
is issued to a seller of assets or a Person the subject of a Permitted
Business Acquisition or that is otherwise incurred to fund consideration
payable in a Permitted Business Acquisition (and for no other purpose) in
a transaction permitted by this Agreement in an aggregate principal amount
at any one time outstanding not exceeding $40,000,000; provided that (A)
any such Debt that constitutes Subordinated Debt shall be unsecured and
(B) any such Debt other than Subordinated Debt shall not (together with
all Debt assumed pursuant to subclause (A)(y) of the proviso to clause
(iv) above) exceed $20,000,000 at any one time outstanding;
(xii) unsecured Debt of Holdings or Intermediate Holdings
representing the obligation of Holdings or Intermediate Holdings to make
payments with respect to the cancellation or repurchase of certain Equity
Interests of officers, employees or directors (or their estates) of
Holdings and its Subsidiaries, to the extent permitted by Section
7.07(iii);
(xiii) contingent liabilities in respect of any
indemnification, adjustment of purchase price, earn-out, incentive,
non-compete, consulting, deferred compensation and similar obligations of
Holdings and its Subsidiaries incurred or assumed in connection with the
disposition of any business, assets or a Subsidiary, other than Guaranty
Obligations in respect of Debt of any Person acquiring all or any portion
of such business, assets or Subsidiary for the purpose of financing such
acquisition;
(xiv) Debt in respect of performance bonds, bid bonds,
appeal bonds, surety bonds and completion guarantees and similar
obligations, in each case provided in the ordinary course of business,
including those incurred to secure health, safety and environmental
obligations in the ordinary course of business;
(xv) Debt arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument drawn
against insufficient funds in the ordinary course of business; provided
that (A) such Debt (other than credit or purchase cards) is extinguished
within three Business Days of its incurrence and (B) such Debt in respect
of credit or purchase cards in extinguished within 60 days from its
incurrence;
(xvi) accrual of interest on Debt otherwise permitted under
this Section 7.01, accretion or amortization of original issue discount
with respect to Debt otherwise permitted under this Section 7.01 and/or
Debt incurred as a result of payment of interest in kind on Debt otherwise
permitted under this Section 7.01;
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(xvii) Debt or Synthetic Lease Obligations of the Borrower
and its Subsidiaries not otherwise permitted by this Section 7.01 incurred
after the Closing Date in an aggregate principal amount not to exceed
$10,000,000 at any time outstanding; provided that no Default or Event of
Default shall have occurred and be continuing immediately before and
immediately after giving effect to such incurrence; and
(xviii) Debt of Foreign Subsidiaries of the Borrower organized
and operating in Canada or Mexico incurred after the Closing Date in an
aggregate principal amount not to exceed $1,000,000 at any time
outstanding.
SECTION 7.02 RESTRICTION ON LIENS. None of the Group Companies will
create, incur, assume or permit to exist any Lien on any property or assets
(including Equity Interests or other securities of any Person, including any
Subsidiary of Holdings) now owned or hereafter acquired by it or on any income
or rights in respect of any thereof, except Liens described in any of the
following clauses (collectively, "Permitted Liens"):
(i) Liens created by the Collateral Documents;
(ii) Liens (other than any Liens imposed by ERISA or
pursuant to any Environmental Law) for taxes (including outstanding
Chapter 11 taxes), assessments or governmental charges or levies not yet
more than 30 days overdue or not required to be paid pursuant to Section
6.05;
(iii) Liens securing the charges, claims, demands or levies
of landlords, carriers, warehousemen, mechanics, sellers of goods,
carriers and other like persons which were incurred in the ordinary course
of business and which (A) secure charges, claims, demands, or levies which
are not more than 30 days overdue or not required to be paid pursuant to
Section 6.05 or (B) do not, individually or in the aggregate, materially
detract from the value of the property or assets which are the subject of
such Lien or materially impair the use thereof in the operation of the
business of the Borrower or any of its Subsidiaries or (C) which are being
contested in good faith by appropriate proceedings diligently pursued,
which proceedings have the effect of preventing the forfeiture or sale of
the property or assets subject to such Lien;
(iv) Liens arising from judgments, decrees or attachments
(or securing of appeal bonds with respect thereto) in circumstances not
constituting an Event of Default under Section 8.01; provided that no cash
or other property (other than proceeds of insurance payable by reason of
such judgments, decrees or attachments) the fair value of which exceeds
$5,000,000 is deposited or delivered to secure any such judgment, decree
or award, or any appeal bond in respect thereof;
(v) Liens (other than any Liens imposed by ERISA or
pursuant to any Environmental Law) not securing Debt or Derivatives
Obligations incurred or deposits made in the ordinary course of business
in connection with workers' compensation, unemployment insurance and other
types of social security and other similar obligations incurred in the
ordinary course of business;
(vi) Liens (including pledges or deposits) securing
obligations in respect of surety bonds (other than appeal bonds), bids,
trade contracts, public or statutory obligations, leases, government
contracts, performance and return-of-money bonds and other similar
obligations incurred in the ordinary course of business;
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(vii) pledges or deposits of cash and Cash Equivalents
securing deductibles, self-insurance, co-payment, co-insurance, retentions
and similar obligations to providers of insurance on the ordinary cause of
business;
(viii) zoning restrictions, building codes, easements, rights
of way, licenses, reservations, covenants, conditions, waivers,
restrictions on the use of property or other minor encumbrances or
irregularities of title not securing Debt or Derivatives Obligations which
do not, individually or in the aggregate, materially impair the use of any
property in the operation or business of Holdings or any of its
Subsidiaries or the value of such property for the purpose of such
business;
(ix) Permitted Encumbrances;
(x) Liens securing Capital Lease Obligations and Purchase
Money Debt permitted to be incurred under Section 7.01(iii) and Liens
securing Debt of Foreign Subsidiaries permitted under Section 7.01
(xviii);
(xi) any Lien existing on any asset of any Person at the
time such Person becomes a Subsidiary of the Borrower and not created in
contemplation of such event;
(xii) any Lien on any asset of any Person existing at the
time such Person is merged or consolidated with or into the Borrower or a
Subsidiary of the Borrower and not created in contemplation of such event;
(xiii) any Lien existing on any asset prior to the
acquisition thereof by the Borrower or a Subsidiary of the Borrower and
not created in contemplation of such acquisition;
(xiv) any Lien securing Refinancing Debt in respect of any
Debt of the Borrower or any Subsidiary of the Borrower secured by any Lien
permitted by clauses (xi), (xii), (xiii) or (xxi) of this Section 7.02;
provided that such Debt is not secured by any additional assets;
(xv) Liens arising solely by virtue of any statutory or
common law provision relating to banker's liens, rights of set-off or
similar rights, in each case incurred in the ordinary course of business;
(xvi) licenses, sublicenses, leases or subleases granted by
a Group Company as lessor to third Persons in the ordinary course of
business not interfering in any material respect with the business of any
Group Company;
(xvii) Liens on (A) incurred premiums, dividends and rebates
which may become payable under insurance policies and loss payments which
reduce the incurred premiums on such insurance policies and (B) rights
which may arise under State insurance guarantee funds relating to any such
insurance policy, in each case securing Debt permitted to be incurred
pursuant to Section 7.01(vii);
(xviii) any (A) Lien not securing any Debt, Derivatives
Obligations or Synthetic Lease Obligations constituting an interest or
title of a licensor, lessor or sublicensor or sublessor under any
Operating Lease or license entered into by the Borrower or any of its
Subsidiaries in compliance with this Agreement or (B) Lien resulting from
the subordination by any such lessor or sublessor of its interest or title
under such Operating Lease to any Lien described in
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subparagraph (viii) above; provided that the holder of such Lien or
restriction agrees in writing to recognize the rights of such lessee or
sublessee under such Operating Lease;
(xix) Liens in favor of customs and revenue authorities
arising as a matter of Law to secure payment of customs duties in
connection with the importation of goods;
(xx) Liens securing obligations (other than Debt or
Derivatives Obligations) under operating, reciprocal easement or similar
agreements entered into in the ordinary course of business of the Borrower
and its Subsidiaries;
(xxi) Liens existing on the Closing Date and listed on
Schedule 7.02 hereto; provided that such Liens shall secure only those
obligations which they secure on the date hereof (and permitted
extensions, renewals and refinancings of such obligations) and shall not
subsequently apply to any other property or assets of Holdings and its
Subsidiaries (other than accessions to and the proceeds of the property or
assets subject to such Liens to the extent provided by the terms thereof
on the date hereof);
(xxii) Liens solely on any cash earnest money deposits made
by the Borrower or any of its Subsidiaries in connection with any letter
of intent or purchase agreement with respect to a Permitted Business
Acquisition;
(xxiii) Liens upon specific items or inventory or other goods
and proceeds of the Borrower or any of its Subsidiaries securing such
Person's obligations in respect of bankers' acceptances or documentary
letters of credit issued or created for the account of such Person to
facilitate the shipment or storage of such inventory or other goods; and
(xxiv) Liens deemed to exist in the ordinary course in
connection with Cash Equivalents; and
(xxv) other Liens incurred by the Borrower and its
Subsidiaries if the aggregate amount of the obligations secured thereby do
not exceed $10,000,000.
SECTION 7.03 NATURE OF BUSINESS. None of the Group Companies will
alter in any material respect the character of the business conducted by such
Person as of the Closing Date except that the Borrower and its Subsidiaries may
engage in reasonable extensions thereof and in business reasonably related,
ancillary or complementary thereto.
SECTION 7.04 CONSOLIDATION, MERGER AND DISSOLUTION. Except in
connection with an Asset Disposition permitted by the terms of Section 7.05,
none of the Group Companies will enter into any transaction of merger or
consolidation or liquidate, wind up or dissolve itself or its affairs (or suffer
any liquidations or dissolutions); provided that:
(i) the Merger shall be permitted;
(ii) any Domestic Subsidiary of the Borrower may merge with
and into, or be voluntarily dissolved or liquidated into, the Borrower, so
long as (A) the Borrower is the surviving corporation of such merger,
dissolution or liquidation, (B) the security interests granted to the
Collateral Agent for the benefit of the Finance Parties pursuant to the
Collateral Documents in the assets of the Borrower and such Domestic
Subsidiary so merged, dissolved or liquidated shall remain in full force
and effect and perfected (to at least the same extent as in effect
immediately prior to such merger, dissolution or liquidation), (C) no
Default or Event of Default
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shall have occurred and be continuing immediately before or immediately
after giving effect to such transaction and (D) no Person other than the
Borrower or a Subsidiary Guarantor receives any consideration in respect
or as a result of such transaction;
(iii) any Domestic Subsidiary of the Borrower may merge with
and into, or be voluntarily dissolved or liquidated into, any other
Domestic Subsidiary of the Borrower, so long as (A) in the case of any
such merger, dissolution or liquidation involving one or more Subsidiary
Guarantors, (y) a Subsidiary Guarantor is the surviving corporation of
such merger, dissolution or liquidation, (z) no Person other than the
Borrower or a Subsidiary Guarantor receives any consideration in respect
of or as a result of such transaction, (B) the security interests granted
to the Collateral Agent for the benefit of the Finance Parties pursuant to
the Collateral Documents in the assets of each Domestic Subsidiary so
merged, dissolved or liquidated and in the Equity Interests of the
surviving entity of such merger dissolution or liquidation shall remain in
full force and effect and perfected (to at least the same extent as in
effect immediately prior to such merger, dissolution or liquidation) and
(C) no Default or Event of Default shall have occurred and be continuing
immediately before or immediately after giving effect to such transaction;
(iv) any Foreign Subsidiary of the Borrower may be merged
with and into, or be voluntarily dissolved or liquidated into, the
Borrower or any Subsidiary of the Borrower, so long as (A) in the case of
any such merger, dissolution or liquidation involving one or more
Subsidiary Guarantors, (y) the Borrower or a Subsidiary Guarantor, as the
case may be, is the surviving corporation of any such merger, dissolution
or liquidation and (z) no Person other than the Borrower or a Subsidiary
Guarantor receives any consideration in respect of or as a result of such
transaction, (B) the security interests granted to the Collateral Agent
for the benefit of the Finance Parties pursuant to the Collateral
Documents in the assets of such Foreign Subsidiary, if any, and the
Borrower or such other Subsidiary, as the case may be, and in Equity
Interests of the surviving entity of such merger, dissolution or
liquidation shall remain in full force and effect and perfected (to at
least the same extent as in effect immediately prior to such merger,
dissolution or liquidation) and (C) no Default or Event of Default shall
have occurred and be continuing immediately before or immediately after
giving effect to such transaction; and
(v) the Borrower or any Subsidiary of the Borrower may
merge with any Person (other than Holdings) in connection with a Permitted
Business Acquisition if (A) in the case of any such merger involving the
Borrower, the Borrower shall be the continuing or surviving corporation in
such merger, (B) in the case of any such merger involving a Subsidiary
Guarantor, such Subsidiary Guarantor, as the case may be, shall be the
continuing or surviving corporation in such merger or the continuing or
surviving corporation in such merger shall, simultaneously with the
consummation of such merger, become a Subsidiary Guarantor having all the
responsibilities and obligations of the Subsidiary Guarantor so merged, or
(C) the Credit Parties shall cause to be executed and delivered such
documents, instruments and certificates as the Lead Arrangers may
reasonably request so as to cause the Credit Parties to be in compliance
with the terms of Section 6.10 after giving effect to such transactions.
In the case of any merger or consolidation permitted by this Section 7.04
of any Subsidiary of Holdings which is not a Credit Party into a Credit
Party, the Credit Parties shall cause to be executed and delivered such
documents, instruments and certificates as the Administrative Agent may
reasonably request so as to cause the Credit Parties to be in compliance
with the terms of Section 6.10 after giving effect to such transaction.
Notwithstanding anything to the contrary contained above in this Section
7.04, no action shall be permitted which results in a Change of Control.
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SECTION 7.05 ASSET DISPOSITIONS. None of the Group Companies will
make any Asset Disposition; provided that:
(i) any Group Company may sell inventory in the ordinary
course of business on an arms'-length basis;
(ii) the Borrower may make any Asset Disposition to any of
the Subsidiary Guarantors if (A) the Credit Parties shall cause to be
executed and delivered such documents, instruments and certificates as the
Administrative Agent or the Collateral Agent may request so as to cause
the Credit Parties to be in compliance with the terms of Section 6.10
after giving effect to such Asset Disposition and (B) after giving effect
to such Asset Disposition, no Default or Event of Default exists;
(iii) the Borrower and its Subsidiaries may liquidate or
sell Cash Equivalents;
(iv) the Borrower or any of its Subsidiaries may sell,
lease, transfer, assign or otherwise dispose of assets (other than in
connection with any Casualty or Condemnation) to any other Person provided
that the aggregate fair market value of all property disposed of pursuant
to this clause (iv) does not exceed $3,000,000 in the aggregate in any
fiscal year of the Borrower or $10,000,000 in the aggregate from and after
the Closing Date;
(v) the Borrower or any of its Subsidiaries may dispose of
machinery or equipment which will be replaced or upgraded with machinery
or equipment put to a similar use and owned, or otherwise used or useful
in the ordinary course of business of and owned by such Person; provided
that (A) such replacement or upgraded machinery and equipment is acquired
within 120 days after such disposition, and (B) upon their acquisition,
such replacement assets become subject to the Lien of the Collateral Agent
under the Collateral Documents (to the extent in effect immediately prior
to such disposition);
(vi) the Borrower or any of its Subsidiaries may in the
ordinary course of business and in a commercially reasonable manner,
dispose of obsolete, worn-out or surplus tangible assets and other excess
property no longer used or useful in the ordinary course of business;
(vii) any Group Company may enter into any Sale/Leaseback
Transaction not prohibited by Section 7.13;
(viii) any Subsidiary of the Borrower may sell, lease or
otherwise transfer (x) any or all or substantially all of its assets
(including any such transaction effected by way of merger or
consolidation) to the Borrower or any Wholly-Owned Domestic Subsidiary of
the Borrower, so long as (A) the security interests granted to the
Collateral Agent for the benefit of the Finance Parties pursuant to the
Collateral Documents in such assets shall remain in full force and effect
and perfected (to at least the same extent as in effect immediately prior
to such sale, lease or other transfer) and (B) after giving effect to such
Asset Disposition, no Default or Event of Default exists, and (y) assets
to Foreign Subsidiaries or non-Wholly-Owned Domestic Subsidiaries to the
extent permitted by Section 7.06(x);
(ix) any non-Wholly-Owned Domestic Subsidiary or Foreign
Subsidiary of the Borrower may sell, lease or otherwise transfer any or
all or substantially all of its assets (including any such transactions
effected by way of merger or consolidation) to any other non-Wholly-Owned
Domestic Subsidiary or Foreign Subsidiary of the Borrower, so long as the
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security interests granted to the Collateral Agent for the benefit of the
Finance Parties pursuant to the Collateral Documents in such assets shall
remain in full force and effect and perfected (to at least the same extent
as in effect immediately prior to such sale, lease or other transfer);
(x) any Group Company may (A) lease, as lessor or
sublessor, or license, as licensor or sublicensor, real or personal
property (including Intellectual Property) in the ordinary course of
business and consistent with past practices and (B) grant options to
purchase, lease or acquire real or personal property in the ordinary
course of business, so long as the Asset Disposition resulting from the
exercise of such option would otherwise be permitted under this Section
7.05;
(xi) any Group Company may dispose of defaulted receivables
and similar obligations in the ordinary course of business and not as part
of an accounts receivable financing transaction;
(xii) any Group Company may dispose of non-core assets
acquired in connection with Permitted Business Acquisitions;
(xiii) any Group Company may make one or more Asset
Dispositions involving any or all of the assets described in Schedule
7.05;
(xiv) any Group Company may make one or more Asset
Dispositions in connection with a like-kind exchange pursuant to Section
1031 of the Code; provided that the Borrower shall have delivered to the
Administrative Agent a Pro-Forma Compliance Certificate demonstrating that
upon giving effect on a Pro-Forma Basis to such transaction, the Credit
Parties will be in compliance with all of the financial covenants set
forth in Section 7.17(a) and (b) as of the last day of the most recent
period of four consecutive fiscal quarters of Holdings which precedes or
ends on the date of such transaction and with respect to which the
Administrative Agent has received the consolidated financial information
required under Section 6.01(a) or (b) and the officer's certificate
required under Section 6.01(c);
(xv) any Group Company may sell or dispose of Equity
Interests in its Subsidiaries to qualify directors where required by
applicable law or to satisfy other requirements of applicable law with
respect to the ownership of Equity Interests of Foreign Subsidiaries; and
(xvi) any Group Company may make any other Asset
Disposition; provided that (A) at least 75% of the consideration therefor
is cash or Cash Equivalents; (B) if such transaction is a Sale/Leaseback
Transaction, such transaction is permitted by Section 7.01 and Section
7.13; (C) such transaction does not involve the sale or other disposition
of a minority Equity Interest in any Group Company; (D) the aggregate fair
market value of all assets sold or otherwise disposed of by the Group
Companies in all such transactions in reliance on this clause (xvi) shall
not exceed $10,000,000 in the aggregate from and after the Closing Date;
and (E) no Default or Event of Default shall have occurred and be
continuing immediately before or immediately after giving effect to such
transaction.
Upon consummation of an Asset Disposition permitted under this Section 7.05, the
Lien therein created (but not the Lien on any proceeds thereof) under the
Collateral Documents shall be automatically released and the Administrative
Agent shall (or shall cause the Collateral Agent to) (to the extent applicable)
deliver to the Borrower, upon the Borrower's request and at the Borrower's
expense, such documentation as is reasonably necessary to evidence the release
of the Collateral Agent's security interests, if any, in the assets being
disposed of, including amendments or terminations of Uniform Commercial Code
Financing
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Statements, if any, the return of stock certificates, if any, and the release of
any Subsidiary being disposed of in its entirety from all of its obligations, if
any, under the Senior Finance Documents.
SECTION 7.06 INVESTMENTS.
(a) Investments. None of the Group Companies will hold, make or
acquire, any Investment in any Person, except the following:
(i) Investments existing on the date hereof in Persons
which are Subsidiaries on the date hereof;
(ii) Holdings, the Borrower, Intermediate Holdings or any
Subsidiary of the Borrower may invest in cash and Cash Equivalents;
(iii) Holdings or Intermediate Holdings may acquire and hold
obligations of one or more officers or other employees of Holdings or any
of its Subsidiaries in connection with such officers' or employees'
acquisition of Equity Interests of Holdings or Intermediate Holdings, so
long as no cash is paid by Holdings or any of its Subsidiaries to such
officers or employees in connection with the acquisition of any such
obligations or such cash is immediately reinvested in such Equity
Interests;
(iv) the Borrower and any Subsidiary of the Borrower may
acquire and hold receivables not constituting Debt owing to them, if
created or acquired in the ordinary course of business;
(v) the Borrower and each Subsidiary of the Borrower may
acquire and own Investments (including Debt obligations) received in
connection with the bankruptcy or reorganization of suppliers and
customers and in settlement of delinquent obligations of, and other
disputes with, customers and suppliers arising in the ordinary course of
business;
(vi) deposits by the Borrower or any Subsidiary of the
Borrower made in the ordinary course of business consistent with past
practices to secure the performance of leases shall be permitted;
(vii) Holdings may make equity contributions to the capital
of Intermediate Holdings which may make equity contributions to the
capital of the Borrower and both Holdings and Intermediate Holdings may
incur Guaranty Obligations permitted under Section 7.01(viii);
(viii) Holdings and Intermediate Holdings may hold (i) the
Trust Common Securities and (ii) promissory notes issued by Borrower and
Intermediate Holdings (as applicable);
(ix) the Borrower may make Investments in any of its
Wholly-Owned Domestic Subsidiaries and any Subsidiary of the Borrower may
make Investments in the Borrower or any Wholly-Owned Domestic Subsidiary
of the Borrower; provided that (A) each item of intercompany Debt
evidencing intercompany loans and advances made by a Foreign Subsidiary or
a non-Wholly-Owned Domestic Subsidiary to the Borrower or a Wholly-Owned
Domestic Subsidiary of the Borrower shall be evidenced by a promissory
note in the form of Exhibit G hereto containing the subordination
provisions set forth in Exhibit H hereto and (B) each promissory note
evidencing intercompany loans and advances payable to a Credit Party shall
be pledged to the Collateral Agent pursuant to the Collateral Documents;
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(x) the Borrower and its Subsidiaries may make Investments
in any Foreign Subsidiary organized and operating in Canada and Mexico or
any non-Wholly-Owned Domestic Subsidiary of the Borrower (A) in the case
of Investments by the Borrower or any Wholly-Owned Domestic Subsidiary of
the Borrower, in an aggregate amount (determined without regard to any
write-downs or write-offs of any such Investments constituting Debt) and
together with the fair market value of all assets transferred pursuant to
Section 7.05(viii) at any one time outstanding not exceeding $5,000,000
and (B) to the extent such Investments arise from the sale of inventory in
the ordinary course of business by the Borrower or such Subsidiary to such
Foreign Subsidiary or non-Wholly-Owned Domestic Subsidiary for resale by
such Foreign Subsidiary or non-Wholly-Owned Domestic Subsidiary (including
any such Investments resulting from the extension of the payment terms
with respect to such sales); provided that each promissory note evidencing
intercompany loans and advances (other than promissory notes (A) issued by
Foreign Subsidiaries of the Borrower to the Borrower or any of its
Domestic Subsidiaries or (B) held by Foreign Subsidiaries of the Borrower,
in each case except to the extent provided in Section 6.10(d)) or
non-Wholly-Owned Subsidiaries of the Borrower who are not and are not
required to be Credit Parties) shall be pledged to the Collateral Agent
pursuant to the Collateral Documents;
(xi) so long as no Default or Event of Default is then in
existence or would otherwise arise therefrom, the Borrower may make
Investments in Holdings and Intermediate Holdings provided that (A) all
proceeds thereof are applied by Holdings or passed on by Intermediate
Holdings to Holdings solely for the purposes of Section 7.08(d); (B) no
such Investment shall be made if an interest payment in respect of the
Junior Debentures could not, but for such Investment, be made in
accordance with Section 7.08(d); and (C) each item of intercompany Debt
evidencing intercompany loans and advances made by the Borrower to
Holdings or Intermediate Holdings shall be evidenced by a promissory note
in the form of Exhibit G hereto containing the subordination provisions
set forth in Exhibit H hereto;
(xii) the Borrower and its Subsidiaries may make transfers
of assets to the Borrower and its Subsidiaries in accordance with Section
7.05(viii) and (ix) and in connection with mergers and consolidations
permitted under Section 7.04;
(xiii) the Borrower and its Subsidiaries may purchase
inventory, machinery, equipment and other assets in the ordinary course of
business;
(xiv) the Borrower and its Subsidiaries may make
expenditures in respect of Permitted Business Acquisitions;
(xv) the Borrower or any of its Subsidiaries may make loans
and advances to employees of Holdings and its Subsidiaries for moving and
travel and other similar expenses, in each case in the ordinary course of
business, in an aggregate principal amount not to exceed $250,000 at any
one time outstanding (determined without regard to any write-downs or
write-offs of such loans and advances);
(xvi) the Borrower or any of its Subsidiaries may make loans
and advances to Holdings and Intermediate Holdings and Intermediate
Holdings may make loans to Holdings for the purposes and in the amounts
necessary to make payments described in Section 7.07;
(xvii) Holdings and Intermediate Holdings may redeem or
repurchase Equity Interests to the extent permitted by Section 7.07;
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(xviii) the Borrower and its Subsidiaries may make Investments
in Permitted Joint Ventures in an aggregate amount (determined without
regard to any write-downs or write-offs of any such Investments
constituting Debt) at any one time outstanding not exceeding $5,000,000;
(xix) Investments existing on the date hereof and identified
on Schedule 7.06;
(xx) Investments arising out of the receipt by the Borrower
or any of its Subsidiaries of noncash consideration for the sale of assets
permitted under Section 7.05;
(xxi) Investments resulting from pledges and deposits
specifically referred to in Section 7.02; and
(xxii) other Investments not otherwise permitted by this
Section 7.06 in an aggregate amount (determined without regard to any
write-downs or write-offs of any such Investments constituting Debt but
excluding any portion thereof funded with proceeds of an Qualifying Equity
Issuance) at any time outstanding not exceeding the sum of (A) $5,000,000
plus (B) an amount, not exceeding $5,000,000 in the aggregate, equal to
that portion of Excess Cash Flow for the fiscal years ended after the
Closing Date, if any, not required to be used to prepay the Loans or Cash
Collateralize LC Obligations in accordance with Section 2.09;
provided that no Group Company may make or own any Investment in Margin Stock.
(b) Limitation on the Creation of Subsidiaries. No Group Company
will establish, create or acquire after the Closing Date any Subsidiary;
provided that the Borrower and its Subsidiaries shall be permitted to establish,
create or acquire Subsidiaries so long as (i) at least 5 days' prior written
notice thereof is given to the Administrative Agent, (ii) the Investment
resulting from such establishment, creation or acquisition is permitted pursuant
to Section 7.06(a) above, (iii) the capital stock or other equity interests of
such new Subsidiary (other than a Foreign Subsidiary, except to the extent
otherwise required pursuant to Section 6.10(d)) is pledged pursuant to, and to
the extent required by, the Pledge Agreement and the certificates representing
such interests, together with transfer powers duly executed in blank, are
delivered to the Collateral Agent, (iv) such new Subsidiary (other than a
Foreign Subsidiary, except to the extent otherwise required pursuant to Section
6.10(d)) executes a counterpart of the Accession Agreement, the Guaranty, the
Security Agreement and the Pledge Agreement to the extent required by Section
6.10(b), and (v) such new Subsidiary, to the extent requested by the
Administrative Agent, takes all other actions required pursuant to Section 6.10.
SECTION 7.07 RESTRICTED PAYMENTS, ETC. None of the Group Companies
will declare or pay any Restricted Payments (other than Restricted Payments
payable solely in Equity Interests (exclusive of Debt Equivalents) of such
Person), except that:
(i) any Wholly-Owned Subsidiary of the Borrower may make
Restricted Payments to the Borrower or to any Wholly-Owned Subsidiary of
the Borrower;
(ii) any non-Wholly-Owned Subsidiary of the Borrower may
make Restricted Payments to the Borrower or to any Wholly-Owned Subsidiary
of the Borrower or ratably to all holders of its outstanding Equity
Interests;
(iii) Holdings and Intermediate Holdings may redeem or
repurchase Equity Interests (or Equity Equivalents) or to make payments on
notes issued in connection with the prior redemption or purchase of such
Equity Interests and permitted pursuant to Section 7.01(xii)
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from (A) officers, employees and directors of any Group Company (or their
estates, spouses or former spouses) upon the death, permanent disability,
retirement or termination of employment of any such Person or otherwise or
(B) other holders of Equity Interests or Equity Equivalents in Holdings
and Intermediate Holdings, so long as the purpose of such purchase is to
acquire stock for reissuance to new officers, employees and directors (or
their estates) of any Group Company, to the extent so reissued within 12
months of any such purchase; provided that in all such cases (A) no
Default or Event of Default is then in existence or would otherwise arise
therefrom, (B) the aggregate amount of all cash distributed by the
Borrower directly or indirectly to Holdings and Intermediate Holdings in
respect of all such shares so redeemed or repurchased (or otherwise spent
by Holdings and Intermediate Holdings) does not exceed $2,000,000 in any
fiscal year of Holdings (with unused amounts being carried forward to
succeeding fiscal years) or $10,000,000 in the aggregate from and after
the Closing Date, and provided further that Holdings and Intermediate
Holdings may purchase, redeem or otherwise acquire Equity Interests and
Equity Equivalents of Holdings and Intermediate Holdings pursuant to this
clause (iii) without regard to the restrictions set forth in the first
proviso above for consideration consisting of the proceeds of key man life
insurance obtained for the purposes described in this clause (iii);
(iv) so long as no Default or Event of Default is then in
existence or would otherwise arise therefrom, the Borrower may make cash
Restricted Payments, directly or indirectly, to Holdings and Intermediate
Holdings, if Holdings and Intermediate Holdings promptly use such proceeds
for the purposes described in clause (iii) above;
(v) the Borrower and Intermediate Holdings may make cash
Restricted Payments, directly or indirectly, to Intermediate Holdings or
Holdings (as the case may be) for the purpose of paying, and in amounts
not to exceed the amount necessary to pay, (A) the then currently due fees
and expenses of Holdings' counsel, accountants and other advisors and
consultants, and other operating and administrative expenses of Holdings
(including employee and compensation expenditures and other similar costs
and expenses) incurred in the ordinary course of business that are for the
benefit of, or are attributable to, or are related to, including the
financing or refinancing of, Holdings' Investment in the Borrower and its
Subsidiaries, (B) the then currently due fees and expenses of Holdings'
independent directors and observers and (C) the then currently due taxes
payable by Holdings solely on account of the income of Holdings related to
its Investment in the Borrower and its Subsidiaries and the reasonable
expenses of preparing returns reflecting such taxes; provided that
Holdings agrees to be obligated to contribute to the Borrower any refund
Holdings receives relating to any such taxes and (D) so long as no Default
or Event of Default is then in existence or would arise therefrom, other
fees and expenses permitted under Section 7.09;
(vi) the Borrower may pay directly or indirectly to
Intermediate Holdings or Holdings the amount that Holdings is required to
pay for franchise, federal, state, local or other taxes as the common
parent of an affiliated group (within the meaning of Section 1504 of the
Code) and quarterly or annually for other taxes incurred by Intermediate
Holdings or Holdings; provided that (A) such payments with respect to
income taxes may be made only in respect of the period during which the
Borrower is consolidated with Holdings for purposes of the payment of such
taxes and (B) no such payment by the Borrower may be paid until receipt by
the Administrative Agent of a certificate of the chief financial officer
or chief accounting officer of the Borrower in form and substance
acceptable to the Administrative Agent demonstrating compliance with the
foregoing provisions (such payments being herein referred to as
("Permitted Tax Dividends").
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(vii) so long as no Default or Event of Default is then in
existence or would otherwise arise therefrom, the Borrower may make
Restricted Payments to Holdings, directly or indirectly, provided that (A)
all proceeds thereof are applied by Holdings solely for the purposes of
Section 7.08(d); and (B) no such Restricted Payment shall be made if an
interest payment in respect of the Junior Debentures could not, but for
such Restricted Payment, be made in accordance with Section 7.08(d);
(viii) Holdings and its Subsidiaries may make Restricted
Payments made with Net Cash Proceeds of one or more Qualifying Equity
Issuances within three Business Days following the receipt thereof;
provided that, after giving effect to such Restricted Payment, no Change
of Control shall have occurred;
(ix) Holdings and Intermediate Holdings may make noncash
repurchases of Equity Interests deemed to occur upon exercise of stock
options if such Equity Interests represent a portion of the exercise price
of such options; and
(x) cash payments by Holdings and Intermediate Holdings in
lieu of the issuance of fractional shares upon exercise or conversion of
Equity Equivalents.
SECTION 7.08 PREPAYMENTS OF DEBT, ETC.
(a) Amendments of Agreements. None of the Group Companies will, or
will permit any of their respective Subsidiaries to, after the issuance thereof,
amend, waive or modify (or permit the amendment, waiver or modification of) any
of the terms, agreements, covenants or conditions of or applicable to (i) the
Subordinated Debentures Documents or the Junior Debentures or (ii) any other
Subordinated Debt issued by such Group Company if such amendment, waiver or
modification would add or change any terms, agreements, covenants or conditions
in any manner adverse to any Group Company, or shorten the final maturity or
average life to maturity or require any payment to be made sooner than
originally scheduled or increase the interest rate applicable thereto or change
any subordination provision thereof.
(b) Prohibition Against Certain Payments of Principal and Interest
of Other Debt. Except as provided in subsection (c) or (d) below, none of the
Group Companies will (i) directly or indirectly, redeem, purchase, prepay,
retire, defease or otherwise acquire for value, prior to scheduled maturity,
scheduled repayment or scheduled sinking fund payment, any Subordinated Debt, or
set aside any funds for such purpose, whether such redemption, purchase,
prepayment, retirement or acquisition is made at the option of the maker or at
the option of the holder thereof, and whether or not any such redemption,
purchase, prepayment, retirement or acquisition is required under the terms and
conditions applicable to such Debt or (ii) make any interest or other payment in
respect of Subordinated Debentures, the Junior Debentures or any other
Subordinated Debt.
(c) Certain Allowed Payments in Respect of Subordinated Debt.
Holdings, the Borrower and any of its Subsidiaries may (i) make interest
payments as and when due in respect of the Subordinated Debentures and any other
Subordinated Debt (other than the Junior Debentures) of the Borrower entered
into in compliance with Section 7.01; and other fees, costs and expenses in
connection with the Subordinated Debentures as permitted by the Subordination
Agreement; (ii) refinance Subordinated Debt to the extent expressly permitted
under Section 7.01, in each case other than any such payments prohibited by the
subordination provisions thereof; (iii) exchange Subordinated Debt of Holdings
or any of its Subsidiaries for Equity Interests issued by Holdings or
Intermediate Holdings (provided that Subordinated Debt of Holdings may be
exchanged for Equity Interests of Holdings only);
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and (iv) permit the cancellation or forgiveness of Subordinated Debt of Holdings
or any of its Subsidiaries.
(d) Allowed Payments in Respect of the Junior Debentures.
(i) Holdings may make (A) interest payments as and when
due, and (B) payments of deferred interest (or a portion thereof), in
respect of the Junior Debentures, in each case, if (x) there is no Event
of Default existing under Section 8.01(a) of the Subordinated Debenture
continuing unremedied or unwaived, and (y) Holdings shall have delivered
to the Administrative Agent a Pro-Forma Compliance Certificate
demonstrating that upon giving effect to such payments on a Pro-Forma
Basis, including as if such payments under clause (A) and (B) were made in
the prior period of calculation (with pro-forma adjustments satisfactory
to the Administrative Agent), the Fixed Charge Coverage Ratio, as of the
last day of the period of four consecutive fiscal quarters of Holdings,
taken as a single accounting period, most recent period of four
consecutive fiscal quarters of Holdings which precedes or ends on the date
of such payment, will not be less than the ratio set forth below opposite
the period during which such day occurs:
FISCAL QUARTERS ENDED DURING RATIO
- ----------------------------- -----------
Closing Date through 12/31/06 1.20 to 1.0
1/01/07 through 12/31/07 1.25 to 1.0
1/01/08 through 12/31/08 1.30 to 1.0
1/01/09 through 12/31/09 1.35 to 1.0
1/01/10 through 3/31/11 1.40 to 1.0
(ii) In the event that Holdings cannot make a payment
pursuant to the terms of paragraph (i) above, Holdings will within 5
Business Days after the calculation under clause (i) above prior to the
relevant scheduled interest payment date under the Junior Debentures serve
a notice on the Junior Debenture Holders of an Extension Period for a
period of not less than six months (as such term is defined in the Junior
Debentures Indenture) (an "Extension Notice"), with a copy of such notice,
certified as true and correct, to be simultaneously delivered to the
Administrative Agent; and
(iii) Holdings hereby irrevocably appoints the
Administrative Agent as its attorney-in-fact (with full power of
substitution and delegation) in its name and on its behalf to serve an
Extension Notice on the Junior Debentures Holders, in the event that
Holdings does not deliver an Extension Notice to the Junior Debentures
Holders and the Administrative Agent within the applicable period as
prescribed in paragraph (ii) above.
SECTION 7.09 TRANSACTIONS WITH AFFILIATES. None of the Group
Companies will engage in any transaction or series of transactions with any
Affiliate of Holdings other than:
(i) commencing with the fiscal quarter of the Borrower
ended March 31, 2004, the payment of management and other fees when due,
pursuant to the Management Agreement and OTPP Side Letters, in each case,
as in effect, on the date hereof; provided that no such payment may be
made if the Administrative Agent shall have notified the Borrower (which
notice may be provided by electronic mail) that a Default or Event of
Default shall have occurred and be continuing immediately before or
immediately after giving effect to such payment (it being understood and
agreed that any payment which cannot be made when due as a result of a
Default or an Event of Default shall continue to accrue and may be made
upon the cure or waiver of such Default or Event of Default or otherwise
with the consent of the Required Lenders);
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(ii) reimbursement of reasonable out-of-pocket expenses and
indemnities pursuant to the Management Agreement and OTPP Side Letters;
(iii) transfers of assets to any Credit Party other than
Holdings permitted by Section 7.05;
(iv) transactions expressly permitted by Section 7.01,
Section 7.04, Section 7.05, Section 7.06 or Section 7.07;
(v) normal compensation, indemnities and reimbursement of
reasonable expenses of officers, directors and board observers;
(vi) other transactions in existence on the Closing Date to
the extent disclosed in Schedule 7.09;
(vii) any transaction entered into among the Borrower and
its Wholly-Owned Subsidiaries or among such Wholly-Owned Subsidiaries;
(viii) preemptive rights held by the Investor Group in
respect of the Equity Interests of Holdings or Intermediate Holdings; and
(ix) so long as no Default or Event of Default has occurred
and is continuing, other transactions which are engaged in by the Borrower
or any of its Subsidiaries in the ordinary course of its business on terms
and conditions as favorable to such Person as would be obtainable by it in
a comparable arms'-length transaction with an independent, unrelated third
party.
Notwithstanding the foregoing, none of Holdings or any of its Subsidiaries will
enter into any management, consulting or similar agreement or arrangement other
than the Management Agreement with, or otherwise pay any professional,
consulting, management or similar fees to or for the benefit of, the Sponsor
Group or its successors or transferees, except for payments pursuant to the
Management Agreement permitted under clause (i), (ii), (vi) or (viii) above.
SECTION 7.10 FISCAL YEAR; ORGANIZATIONAL AND OTHER DOCUMENTS. None
of the Group Companies will (i) change its fiscal year or (ii) consent to any
amendment, modification or supplement that is adverse in any respect to the
Lenders to its articles or certificate of incorporation, bylaws (or analogous
organizational documents), the Acquisition Documents, the Management Agreement
or any agreement entered into by it with respect to its Equity Interests
(including the Capitalization Documents and the Stockholder Agreements), in each
case as in effect on the Closing Date. The Borrower will cause the Group
Companies to promptly provide the Lenders with copies of all amendments to the
foregoing documents and instruments as in effect as of the Closing Date.
SECTION 7.11 RESTRICTIONS WITH RESPECT TO INTERCORPORATE TRANSFERS.
None of the Group Companies will create or otherwise cause or permit to exist
any consensual encumbrance or restriction which prohibits or otherwise restricts
(i) the ability of any such Subsidiary to (A) make Restricted Payments or pay
any Debt owed to the Borrower or any Subsidiary of the Borrower, (B) pay Debt or
other obligations owed to any Credit Party, (C) make loans or advances to the
Borrower or any Subsidiary of the Borrower, (D) transfer any of its properties
or assets to the Borrower or any Subsidiary of the Borrower or (E) act as a
Subsidiary Guarantor and pledge its assets pursuant to the Senior Finance
Documents or any renewals, refinancings, exchanges, refundings or extensions
thereof or (ii) the ability of Holdings or any Subsidiary of Holdings to create,
incur, assume or permit to exist any Lien upon its
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property or assets whether now owned or hereafter acquired to secure the Senior
Obligations, except in each case for prohibitions or restrictions existing under
or by reason of:
(i) this Agreement and the other Senior Finance Documents;
(ii) restrictions in effect on the date of this Agreement
contained in the Subordinated Debentures Documents or the Junior
Debentures Documents, all as in effect on the date of this Agreement, and,
if such Debt is renewed, extended or refinanced, restrictions in the
agreements governing the renewed, extended or refinancing Debt (and
successive renewals, extensions and refinancings thereof) if such
restrictions are no more restrictive than those contained in the
agreements governing the Debt being renewed, extended or refinanced;
(iii) customary non-assignment provisions with respect to
contracts, leases or licensing agreements entered into by the Borrower or
any of its Subsidiaries, in each case entered into in the ordinary course
of business and consistent with past practices;
(iv) any restriction or encumbrance with respect to any
asset of the Borrower or any of its Subsidiaries or a Subsidiary of the
Borrower imposed pursuant to an agreement which has been entered into for
the sale or disposition of such assets or all or substantially all of the
capital stock or assets of such Subsidiary, so long as such sale or
disposition is permitted under this Agreement;
(v) customary provisions in joint venture agreements and
other similar agreements entered into in the ordinary course of business
in connection with Permitted Joint Ventures;
(vi) restrictions on cash and other deposits or net worth
imposed by customers or suppliers in the ordinary course of business and
consistent with past practice;
(vii) any restriction applicable to an acquired Subsidiary
of the Borrower pursuant to agreements in effect on the date such
Subsidiary became a Subsidiary of the Borrower and otherwise permitted to
remain in effect hereunder; provided that such restrictions apply only to
such Subsidiary;
(viii) Liens permitted under Section 7.02 and any documents
or instruments governing the terms of any Debt or other obligations
secured by any such Liens; provided that such prohibitions or restrictions
apply only to the assets subject to such Liens; and
(ix) documents evidencing indebtedness incurred by Foreign
Subsidiaries to the extent permitted under Section 7.01.
SECTION 7.12 OWNERSHIP OF SUBSIDIARIES; LIMITATIONS ON HOLDINGS AND
THE BORROWER.
(a) Holdings and the Borrower will not (i) permit any Subsidiary
of the Borrower to issue Equity Interests to any Person, except (A) the Borrower
or any Wholly-Owned Subsidiary of the Borrower, (B) to qualify directors where
required by applicable Law or to satisfy other requirements of applicable Law
with respect to the ownership of Equity Interests of Foreign Subsidiaries or (C)
in the case of non-Wholly-Owned Subsidiaries of the Borrower, ratably to all
holders of its outstanding Equity Interests or (ii) permit any non Wholly Owned
Subsidiary of the Borrower to issue any shares of Preferred Stock.
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(b) Each of Holdings and Intermediate Holdings will not (i) hold
any material assets other than the Trust Common Securities, the Equity Interests
of Intermediate Holdings and the Borrower respectively and cash or Cash
Equivalents expressly permitted to be received and held by it from time to time
in accordance with this Agreement, (ii) have any material liabilities other than
(A) liabilities under the Senior Finance Documents, the Subordinated Debentures,
the Junior Debentures or the Management Put Rights and other obligations or
liabilities expressly permitted to be incurred by it pursuant to Section 7.01
and (B) tax and accrued liabilities and expenses in the ordinary course of
business or (iii) engage in any business activity other than (A) owning the
Trust Common Securities, the common stock of Intermediate Holdings and the
Borrower, respectively (including purchasing additional shares of common stock
after the Closing Date), and activities incidental or related thereto or to the
maintenance of the corporate existence of Holdings and Intermediate Holdings,
respectively, or compliance with applicable law, (B) acting as a Guarantor under
its Guaranty and pledging its assets to the Collateral Agent, for the benefit of
the Lenders, pursuant to the Collateral Documents to which it is a party, (C)
acting as a guarantor in respect of the Debt arising under (x) the Subordinated
Debentures Indenture and the Subordinated Debentures, and (y) the Trust
Preferred Securities, and other Guaranty Obligations expressly permitted to be
incurred by it pursuant to Section 7.01 and (D) issuing its own Capital Stock
(other than Debt Equivalents).
(c) Holdings and Intermediate Holdings will not permit any Person
other than (i) Holdings to hold any Equity Interests comprising of common stock
of Intermediate Holdings and (ii) Intermediate Holdings to hold Equity Interests
or Equity Equivalents of the Borrower.
SECTION 7.13 SALE AND LEASEBACK TRANSACTIONS. None of the Group
Companies will directly or indirectly become or remain liable as lessee or as
guarantor or other surety with respect to any lease (whether an Operating Lease
or a Capital Lease) of any property (whether real, personal or mixed), whether
now owned or hereafter acquired, (i) which such Group Company has sold or
transferred or is to sell or transfer to any other Person which is not a Group
Company or (ii) which such Group Company intends to use for substantially the
same purpose as any other property which has been sold or is to be sold or
transferred by such Group Company to another Person which is not a Group Company
in connection with such lease; provided, however, that the Group Companies may
enter into any Sale/Leaseback Transaction if (i) after giving effect on a
Pro-Forma Basis to such Sale/Leaseback Transaction, the aggregate outstanding
Attributable Debt in respect of all Sale/Leaseback Transactions does not exceed
$5,000,000 and the Borrower shall be in compliance with all other provisions of
this Agreement, including Section 7.01 and Section 7.02, (B) the gross cash
proceeds of any such Sale/Leaseback Transaction are at least equal to the fair
market value of such property (as determined by the Board of Directors, whose
determination shall be conclusive if made in good faith) and (C) the Net Cash
Proceeds are applied as set forth in Section 2.09(b)(iv) to the extent required
therein.
SECTION 7.14 CAPITAL EXPENDITURES.
(a) None of the Group Companies will make any Consolidated Capital
Expenditures, except that during any of the fiscal years set forth below, the
Borrower and its Subsidiaries may make Consolidated Capital Expenditures so long
as the aggregate amount of such Consolidated Capital Expenditures (other than
Consolidated Capital Expenditures made with the Net Cash Proceeds of one or more
Qualified Equity Issuances) does not exceed the amount indicated opposite such
period; provided that the reference below to the 2004 fiscal year shall be to
the year from the Closing Date to the last day of such fiscal year:
PERIOD AMOUNT
- ------ -----------
2004 $15,000,000
2005 $15,000,000
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2006 $15,000,000
2007 $16,000,000
2008 $16,000,000
2009 $17,000,000
2010 $17,000,000
2011 $18,000,000
(b) To the extent that Consolidated Capital Expenditures permitted
under subsection (a) above for any period set forth above are less than the
applicable amount specified in the table in subsection (a) above, the difference
may be carried forward and utilized to make Consolidated Capital Expenditures
during succeeding fiscal years so long as the aggregate amount of Consolidated
Capital Expenditures made during any fiscal year does not exceed 120% of the
applicable amount set forth for such year in the table above.
(c) Notwithstanding the foregoing, the Borrower and its
Subsidiaries may make Consolidated Capital Expenditures (which Consolidated
Capital Expenditures will not be included in any determination under subsection
(a) above) with the Net Cash Proceeds of Asset Dispositions, to the extent such
Net Cash Proceeds are not required to be applied to repay Loans or Cash
Collateralize Letter of Credit Liabilities pursuant to Section 2.09(b)(iii).
SECTION 7.15 ADDITIONAL NEGATIVE PLEDGES. None of the Group
Companies will enter into, assume or become subject to any agreement prohibiting
or otherwise restricting the creation or assumption of any Lien upon its
properties or assets, whether now owned or hereafter acquired, or requiring the
grant of any security for an obligation if security is given for some other
obligation, except (i) pursuant to this Agreement and the other Senior Finance
Documents, the Subordinated Debentures Indenture and any Debt consisting of
Refinancing Debt issued to refinance all or any portion of the foregoing, (ii)
pursuant to any document or instrument governing Capital Lease Obligations or
Purchase Money Debt incurred pursuant to Section 7.01 if any such restriction
contained therein relates only to the assets or assets acquired in connection
therewith, (iii) pursuant to any Derivatives Agreement entered into pursuant to
Section 7.01(vi), (iv) pursuant to any document or instrument governing Debt
incurred by Foreign Subsidiaries and permitted by Section 7.01, (v) pursuant to
any documents or agreements creating any Lien referred to in Section 7.02(xvii)
if such restriction contained therein relates only to the incurred premiums,
dividends, rebates and other rights permitted to be subject to such Lien in
accordance with Section 7.02(xvii), (vi) any documents or agreements creating
any Lien referred to in Section 7.02(vi) if such restriction contained therein
relates only to the property of assets subject to the surety bond or similar
obligation permitted to be secured thereby pursuant to Section 7.02(vi), (vii)
pursuant to an agreement which has been entered into by the Borrower or any of
its Subsidiaries for the sale or disposition of any assets of the Borrower or
such Subsidiary or of any Subsidiary of the Borrower if such restriction
contained therein relates only to the Subsidiary or its assets which is the
subject of the sale provided for therein, and (viii) pursuant to a joint venture
or other similar agreement entered into in the ordinary course of business in
connection with Permitted Joint Ventures so long as any such restriction
contained therein relates only to the assets of, or the interest of the Borrower
and its Subsidiaries in, such Permitted Joint Venture.
SECTION 7.16 IMPAIRMENT OF SECURITY INTERESTS. None of the Group
Companies will (i) take or omit to take any action which action or omission
could reasonably be expected to materially impair the security interests in
favor of the Collateral Agent with respect to the Collateral or (ii) grant to
any Person (other than the Collateral Agent pursuant to the Collateral
Documents) any interest whatsoever in the Collateral, except for Permitted
Liens.
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SECTION 7.17 FINANCIAL COVENANTS.
(a) Leverage Ratio. The Leverage Ratio as of the last day of the
most recently ended fiscal quarter of Holdings ending on the last day of any
calendar quarter ending during any period described below will not be greater
than the ratio set forth below opposite the period during which such calendar
quarter ends:
CALENDAR QUARTERS ENDED DURING RATIO
- ------------------------------ -----------
Closing Date through 3/31/05 4.90 to 1.0
4/01/05 through 9/30/05 4.75 to 1.0
10/01/05 through 3/31/06 4.50 to 1.0
4/01/06 through 9/30/06 4.25 to 1.0
10/01/06 through 6/30/07 4.00 to 1.0
7/01/07 through 6/30/08 3.75 to 1.0
7/01/08 through 9/30/08 3.50 to 1.0
10/01/08 through 12/31/08 3.25 to 1.0
1/01/09 through 12/31/09 3.00 to 1.0
1/01/10 through 12/31/10 2.50 to 1.0
1/01/11 through 3/31/11 2.25 to 1.0
(b) Interest Coverage Ratio. The Interest Coverage Ratio as of the
last day of the most recently ended fiscal quarter of the Borrower and its
Consolidated Subsidiaries ending on or about the last day of any calendar
quarter ending during any period described below, in each case for the period of
four consecutive fiscal quarters of the Borrower and its Consolidated
Subsidiaries then ended, taken as a single accounting period, will not be less
than the ratio set forth below opposite the period during which such calendar
quarter ends:
CALENDAR QUARTERS ENDED DURING RATIO
- ------------------------------ -----------
Closing Date through 12/31/05 3.10 to 1.0
1/01/06 through 6/30/08 3.35 to 1.0
7/01/08 through 12/31/08 3.50 to 1.0
1/01/09 through 12/31/10 3.75 to 1.0
1/01/11 through 3/31/11 4.00 to 1.0
(c) Fixed Charge Coverage Ratio. The Fixed Charge Coverage Ratio
as of the last day of the most recently ended fiscal quarter of Holdings ending
on or about the last day of any calendar quarter ending during any period
described below, in each case for the period of four consecutive fiscal quarters
of Holdings then ended, taken as a single accounting period will not be less
than the ratio set forth below opposite the period during which such calendar
quarter ends:
CALENDAR QUARTERS ENDED DURING RATIO
- ------------------------------ -----------
Closing Date through 12/31/04 1.10 to 1.0
1/01/05 through 12/31/05 1.05 to 1.0
1/01/06 through 3/31/11 1.15 to 1.0
SECTION 7.18 NO OTHER "DESIGNATED SENIOR DEBT". None of Holdings or
the Borrower shall designate, or permit the designation of, any Debt (other than
under this Agreement and the other Finance Documents) as "Designated Senior
Debt" or any other similar term as such term is commonly used for the purpose of
the definition of the same or the subordination provisions contained in
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the Subordinated Debentures Indenture, the Junior Debentures Indenture or any
indenture governing any Subordinated Debt permitted under Section 7.01.
SECTION 7.19 INDEPENDENCE OF COVENANTS. All covenants contained
herein shall be given independent effect so that if a particular action or
condition is not permitted by any of such covenants, the fact that such action
or condition would be permitted by an exception to, or otherwise be within the
limitations of, another covenant shall not avoid the occurrence of a Default if
such action is taken or condition exists.
ARTICLE VIII
DEFAULTS
SECTION 8.01 EVENTS OF DEFAULT. An Event of Default shall exist upon
the occurrence of any of the following specified events or conditions (each an
"Event of Default"):
(a) Payment. Any Credit Party shall:
(i) default in the payment when due (whether by scheduled
maturity, acceleration or otherwise) of any principal of any of the Loans
or any LC Disbursements; or
(ii) default, and such default shall continue for five or
more Business Days, (A) in the payment when due of any interest on the
Loans, or (B) after receipt of a notice of a default with respect thereto,
in the payment of any fees or other amounts owing hereunder, under any of
the other Senior Finance Documents or in connection herewith.
(b) Representations. Any representation, warranty or statement
made or deemed to be made by any Credit Party herein, in any of the other Senior
Finance Documents, or in any statement or certificate delivered or required to
be delivered pursuant hereto or thereto shall prove untrue in any material
respect on the date as of which it was made or deemed to have been made.
(c) Covenants. Any Credit Party shall:
(i) default in the due performance or observance of any
term, covenant or agreement contained in Sections 6.01(a), (e) or (j),
6.08, 6.11 or Article VII;
(ii) default in the due performance or observance of any
term, covenant or agreement contained in Sections 6.01(b) or (c) and such
default shall continue unremedied for a period of five Business Days after
the earlier of an executive officer of a Credit Party becoming aware of
such default or notice thereof given by the Administrative Agent; or
(iii) default in the due performance or observance by it of
any term, covenant or agreement contained in Section 6.01(d), (f), (g),
(h) or (i) and such default shall continue unremedied for a period of ten
Business Days after the earlier of an executive officer of a Credit Party
becoming aware of such default or notice thereof given by the
Administrative Agent; or
(iv) default in the due performance or observance by it of
any term, covenant or agreement (other than those referred to in
subsections (a), (b), (c)(i), (c)(ii) or (c)(iii) of this Section 8.01)
contained in this Agreement and such default shall continue unremedied for
a period of 30 days after the earlier of an executive officer of a Credit
Party becoming aware of such default or notice thereof given by the
Administrative Agent.
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(d) Other Senior Finance Documents. (i) Any Credit Party shall
default in the due performance or observance of any term, covenant or agreement
in any of the other Senior Finance Documents and such default shall continue
unremedied for a period of 30 days after the earlier of an executive officer of
a Credit Party becoming aware of such default or notice thereof given by the
Administrative Agent or (ii) except pursuant to the terms thereof, any Senior
Finance Document shall fail to be in full force and effect or any Credit Party
shall so assert.
(e) Cross-Default.
(i) any Group Company (A) fails to make payment when due
(whether by scheduled maturity, required prepayment, acceleration, demand
or otherwise but after giving effect to all applicable grace periods),
regardless of amount, in respect of any Debt, Guaranty Obligation or
Synthetic Lease Obligations (other than in respect of (x) Debt outstanding
under the Senior Finance Documents and (y) Derivatives Agreements) having
an aggregate principal amount (including undrawn committed or available
amounts and including amounts owing to all creditors under any combined or
syndicated credit arrangement) of more than $5,000,000, (B) fails to
perform or observe any other condition or covenant, or any other event
shall occur or condition shall exist, under any agreement or instrument
relating to any such Debt, Guaranty Obligation or Synthetic Lease
Obligations, if the effect of such failure, event or condition is to
cause, or to permit the holder or holders or beneficiary or beneficiaries
of such Debt, Guaranty Obligation or Synthetic Lease Obligations (or a
trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, such Debt or Synthetic Lease Obligations to be
declared to be due and payable prior to its stated maturity or such
Guaranty Obligation to become payable, or cash collateral in respect
thereof to be demanded or (C) shall be required by the terms of such Debt,
Guaranty Obligation or Synthetic Lease Obligation to offer to prepay or
repurchase such Debt or Synthetic Lease Obligation or the primary Debt
underlying such Guaranty Obligation (or any portion thereof) prior to the
stated maturity thereof; or
(ii) there occurs under any Derivatives Agreement or
Derivatives Obligation an Early Termination Date (as defined in such
Derivatives Agreement) resulting from (A) any event of default under such
Derivatives Agreement as to which any Group Company is the Defaulting
Party (as defined in such Derivatives Agreement) or (B) any Termination
Event (as so defined) as to which any Group Company is an Affected Party
(as so defined), and, in either event, the Derivatives Termination Value
owed and not paid within 10 Business Days of when due by a Group Company
as a result thereof is greater than $5,000,000.
(f) Insolvency Events. (i) Any Group Company (other than an
Insignificant Subsidiary) shall commence a voluntary case or other proceeding
seeking liquidation, reorganization or other relief with respect to itself or
its debts under any bankruptcy, insolvency or other similar law now or hereafter
in effect or seeking the appointment of a trustee, receiver, liquidator,
custodian or other similar official of it or any substantial part of its
property, or shall consent to any such relief or to the appointment of or taking
possession by any such official in an involuntary case or other proceeding
commenced against it, or shall make a general assignment for the benefit of
creditors, or shall fail generally to pay its debts as they become due, or shall
take any corporate action to authorize any of the foregoing or (ii) an
involuntary case or other proceeding shall be commenced against any Group
Company (other than an Insignificant Subsidiary) seeking liquidation,
reorganization or other relief with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its property, and such
involuntary case or other proceeding shall remain undismissed and unstayed for a
period of 60 days, or any order for relief shall be entered against any Group
Company (other than an Insignificant Subsidiary) under the federal bankruptcy
laws as now or hereafter in effect.
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(g) Judgments. One or more judgments, orders, decrees or
arbitration awards is entered against any Group Company involving in the
aggregate a liability (to the extent not covered by independent third-party
insurance or an indemnity from a creditworthy third party as to which the
insurer or indemnitor, as applicable, does not dispute coverage), as to any
single or related series of transactions, incidents or conditions, of $5,000,000
or more, and the same shall not have been discharged, vacated or stayed pending
appeal within 30 days after the entry thereof.
(h) Employee Benefit Plans. (i) An ERISA Event occurs which has
resulted or could reasonably be expected to result in liability of any Group
Company in an amount that could reasonably be expected to have a Material
Adverse Effect.
(i) Guaranties. Any Guaranty given by any Credit Parties or any
provision thereof shall, except pursuant to the terms thereof, cease to be in
full force and effect, or any Guarantor thereunder or any Person acting by or on
behalf of such guarantor shall deny or disaffirm such Guarantor's obligations
under such Guaranty.
(j) Impairment of Collateral. Any security interest purported to
be created by any Collateral Document shall cease to be, or shall be asserted by
any Group Company not to be, a valid, perfected, first-priority (except as
otherwise expressly provided in such Collateral Document) security interest in
the securities, assets or properties covered thereby, other than in respect of
assets and properties which, individually and in the aggregate, are not material
to the Group Companies taken as a whole;
(k) Ownership. A Change of Control shall occur.
(l) Subordinated Debt. (i) Any Governmental Authority with
applicable jurisdiction determines that the Lenders are not holders of Senior
Indebtedness (as defined in the Senior Subordinated Debentures Indenture and the
Junior Debentures Indenture and any other Subordinated Debt) or (ii) the
subordination provisions creating the Subordinated Debt shall, in whole or in
part terminate, cease to be effective or cease to be legally valid, binding and
enforceable as to any holder of the Subordinated Debt.
SECTION 8.02 ACCELERATION; REMEDIES. Upon the occurrence of an Event
of Default, and at any time thereafter unless and until such Event of Default
has been waived in writing by the Required Lenders (or the Lenders as may be
required pursuant to Section 10.03), the Administrative Agent (or the Collateral
Agent, as applicable) shall, upon the request and direction of the Required
Lenders, by written notice to the Borrower, take any of the following actions
without prejudice to the rights of the Agents or any Lender to enforce its
claims against the Credit Parties except as otherwise specifically provided for
herein:
(a) Termination of Commitments. Declare the Commitments terminated
whereupon the Commitments shall be immediately terminated.
(b) Acceleration of Loans. Declare the unpaid principal of and any
accrued interest in respect of all Loans, any reimbursement obligations arising
from drawings under Letters of Credit and any and all other indebtedness or
obligations of any and every kind owing by a Credit Party to any of the Lenders
hereunder to be due whereupon the same shall be immediately due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Credit Parties.
(c) Cash Collateral. Direct the Borrower to pay (and the Borrower
agrees that upon receipt of such notice, or upon the occurrence of an Event of
Default under Section 8.01(f), it will immediately pay) to the Collateral Agent
additional cash, to be held by the Collateral Agent, for the
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benefit of the Lenders, in a cash collateral account as additional security for
the LC Obligations in respect of subsequent drawings under all then outstanding
Letters of Credit in an amount equal to 105% of the maximum aggregate amount
which may be drawn under all Letters of Credits then outstanding.
(d) Enforcement of Rights. Enforce any and all rights and
interests created and existing under the Senior Finance Documents, including,
without limitation, all rights and remedies existing under the Collateral
Documents, all rights and remedies against a Guarantor and all rights of
set-off.
Notwithstanding the foregoing, if an Event of Default specified in
Section 8.01(f) shall occur, then the Commitments shall automatically terminate
and all Loans, all reimbursement obligations under Letters of Credit, all
accrued interest in respect thereof and all accrued and unpaid fees and other
indebtedness or obligations owing to the Lenders hereunder and under the other
Senior Finance Documents shall immediately become due and payable without the
giving of any notice or other action by the Administrative Agent or the Lenders,
which notice or other action is expressly waived by the Credit Parties.
Notwithstanding the fact that enforcement powers reside primarily
with the Administrative Agent, each Lender has, to the extent permitted by law,
a separate right of payment and shall be considered a separate "creditor"
holding a separate "claim" within the meaning of Section 101(5) of the
Bankruptcy Code or any other insolvency statute.
In case any one or more of the covenants and/or agreements set forth
in this Agreement or any other Senior Finance Document shall have been breached
by any Credit Party, then the Administrative Agent may proceed to protect and
enforce the Lenders' rights either by suit in equity and/or by action at law,
including an action for damages as a result of any such breach and/or an action
for specific performance of any such covenant or agreement contained in this
Agreement or such other Senior Finance Document. Without limitation of the
foregoing, the Borrower agrees that failure to comply with any of the covenants
contained herein will cause irreparable harm and that specific performance shall
be available in the event of any breach thereof. The Administrative Agent acting
pursuant to this paragraph shall be indemnified by the Borrower against all
liability, loss or damage, together with all reasonable costs and expenses
related thereto (including reasonable legal and accounting fees and expenses) in
accordance with Section 10.05.
SECTION 8.03 ALLOCATION OF PAYMENTS AFTER EVENT OF DEFAULT.
(a) Priority of Distributions. The Borrower hereby irrevocably
waives the right to direct the application of any and all payments in respect of
its Finance Obligations and any proceeds of Collateral after the occurrence and
during the continuance of an Event of Default and agrees that, notwithstanding
the provisions of Sections 2.09(b) and 2.14, after the occurrence and during the
continuance of an Event of Default, all amounts collected or received by the
Administrative Agent, the Collateral Agent or any Finance Party on account of
amounts then due and outstanding under any of the Senior Finance Documents or
any Derivative Agreement or in respect of the Collateral shall be paid over or
delivered in respect of its Finance Obligations as follows:
FIRST, to pay interest on and then principal of any portion of
the Revolving Loans that the Administrative Agent may have advanced on
behalf of any Lender for which the Administrative Agent has not then been
reimbursed by such Lender or the Borrower;
SECOND, to pay interest on and then principal of any Swingline
Loan;
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THIRD, to the payment of all reasonable out-of-pocket costs
and expenses (including reasonable attorneys' fees) of the Administrative
Agent or the Collateral Agent in connection with enforcing the rights of
the Finance Parties under the Finance Documents, including all expenses of
sale or other realization of or in respect of the Collateral, including
reasonable compensation to the agents and counsel for the Collateral
Agent, and all expenses, liabilities and advances incurred or made by the
Collateral Agent in connection therewith, and any other obligations owing
to the Collateral Agent in respect of sums advanced by the Collateral
Agent to preserve the Collateral or to preserve its security interest in
the Collateral;
FOURTH, to the payment of all reasonable out-of-pocket costs
and expenses (including reasonable attorneys' fees) of (i) each of the
Lenders (including any Issuing Lender in its capacity as such) in
connection with enforcing its rights under the Senior Finance Documents or
otherwise with respect to the Senior Obligations owing to such Lender and
(ii) each Derivatives Creditor in connection with enforcing any of its
rights under the Derivatives Agreements or otherwise with respect to the
Derivatives Obligations owing to such Derivatives Creditor;
FIFTH, to the payment of all of the Senior Obligations
consisting of accrued fees and interest;
SIXTH, except as set forth in clauses First through Fifth
above, to the payment of the outstanding Senior Obligations and
Derivatives Obligations owing to any Finance Party, pro-rata, as set forth
below, with (i) an amount equal to the Senior Obligations being paid to
the Collateral Agent (in the case of Senior Obligations owing to the
Collateral Agent) or to the Administrative Agent (in the case of all other
Senior Obligations) for the account of the Lenders or any Agent, with the
Collateral Agent, each Lender and the Agents receiving an amount equal to
its outstanding Senior Obligations, or, if the proceeds are insufficient
to pay in full all Senior Obligations, its Pro-Rata Share of the amount
remaining to be distributed, and (ii) an amount equal to the Derivatives
Obligations being paid to the trustee, paying agent or other similar
representative (each a "Representative") for the Derivatives Creditors,
with each Derivatives Creditor receiving an amount equal to the
outstanding Derivatives Obligations owed to it by the Credit Parties or,
if the proceeds are insufficient to pay in full all such Derivatives
Obligations, its Pro-Rata Share of the amount remaining to be distributed;
SEVENTH, to the payment of the surplus, if any, to whomever
may be lawfully entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be applied
in the numerical order provided until exhausted prior to application to the next
succeeding category; (ii) each of the Finance Parties shall receive an amount
equal to its Pro-Rata Share of amounts available to be applied pursuant to
clauses "FOURTH", "FIFTH", and "SIXTH"" above; and (iii) to the extent that any
amounts available for distribution pursuant to clause "SIXTH" above are
attributable to the issued but undrawn amount of outstanding Letters of Credit,
such amounts shall be held by the Collateral Agent in a cash collateral account
and applied (x) first, to reimburse the Issuing Lender from time to time for any
drawings under such Letters of Credit and (y) then, following the expiration of
all Letters of Credit, to all other obligations of the types described in clause
"SIXTH" above in the manner provided in this Section 8.03.
(b) Pro-Rata Treatment. For purposes of this Section, "Pro-Rata
Share" means, when calculating a Finance Party's portion of any distribution or
amount, that amount (expressed as a percentage) equal to a fraction the
numerator of which is the then unpaid amount of such Finance Party's Senior
Obligations or Derivatives Obligations, as the case may be, and the denominator
of which is the
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then outstanding amount of all Senior Obligations or Derivatives Obligations, as
the case may be. When payments to the Finance Parties are based upon their
respective Pro-Rata Shares, the amounts received by such Finance Parties
hereunder shall be applied (for purposes of making determinations under this
Section 8.03 only) (i) first, to their Senior Obligations and (ii) second, to
their Derivatives Obligations. If any payment to any Finance Party of its
Pro-Rata Share of any distribution would result in overpayment to such Finance
Party, such excess amount shall instead be distributed in respect of the unpaid
Senior Obligations or Derivatives Obligations, as the case may be, of the other
Finance Parties, with each Finance Party whose Senior Obligations or Derivatives
Obligations, as the case may be, have not been paid in full to receive an amount
equal to such excess amount multiplied by a fraction the numerator of which is
the unpaid Senior Obligations or Derivatives Obligations, as the case may be, of
such Finance Party and the denominator of which is the unpaid Senior Obligations
or Derivatives Obligations, as the case may be, of all Finance Parties entitled
to such distribution.
(c) Distributions with Respect to Letters of Credit. Each of the
Finance Parties agrees and acknowledges that if (after all outstanding Loans and
Reimbursement Obligations with respect to Letters of Credit have been paid in
full) the Lenders are to receive a distribution on account of undrawn amounts
with respect to Letters of Credit issued (or deemed issued) under the Credit
Agreement, such amounts shall be deposited in the LC Cash Collateral Account as
cash security for the repayment of Senior Obligations owing to the Lenders as
such. Upon termination of all outstanding Letters of Credit, all of such cash
security shall be applied to the remaining Senior Obligations of the Lenders. If
there remains any excess cash security, such excess cash shall be withdrawn by
the Collateral Agent from the LC Cash Collateral Account and distributed in
accordance with Section 8.03(a) hereof.
(d) Distributions of Funds on Deposit in a Prepayment Account.
Notwithstanding the foregoing provisions of this Section 8.03, amounts on
deposit in a Prepayment Account for any Class of Loans shall be applied upon the
occurrence of any Event of Default, first, to pay Loans of such Class and,
second, after all the Loans of such Class have been paid in full, to the other
Senior Obligations in the manner provided in this Section 8.03.
(e) Reliance by Collateral Agent. For purposes of applying
payments received in accordance with this Section 8.03, the Collateral Agent
shall be entitled to rely upon (i) the Administrative Agent under the Credit
Agreement and (ii) the Representative, if any, for the Derivatives Creditors for
a determination (which the Administrative Agent, each Representative for any
Derivatives Creditor and the Finance Parties agree (or shall agree) to provide
upon request of the Collateral Agent) of the outstanding Senior Obligations or
Derivatives Obligations owed to the Agents, the Lenders or the Derivatives
Creditors, as the case may be. Unless it has actual knowledge (including by way
of written notice from a Derivatives Creditor or any Representatives thereof) to
the contrary, the Collateral Agent, in acting hereunder, shall be entitled to
assume that no Derivatives Agreements are in existence.
ARTICLE IX
AGENCY PROVISIONS
SECTION 9.01 APPOINTMENT; AUTHORIZATION.
(a) Appointment. Each Lender hereby designates and appoints
Merrill Lynch Capital as Administrative Agent and as Collateral Agent and
JPMorgan Chase Bank as Syndication Agent for such Lender to act as specified
herein and in the other Senior Finance Documents, and each such Lender hereby
authorizes the Agents, as the agents for such Lender, to take such action on its
behalf under the provisions of this Agreement and the other Senior Finance
Documents and to exercise such powers and perform such duties as are expressly
delegated by the terms hereof and of the other Senior Finance Documents,
together with such other powers as are reasonably incidental thereto.
Notwithstanding any
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provision to the contrary elsewhere herein and in the other Senior Finance
Documents, the Agents shall not have any duties or responsibilities, except
those expressly set forth herein and therein, or any fiduciary relationship with
any Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any of the other
Senior Finance Documents, or shall otherwise exist against the Agents. In
performing its functions and duties under this Agreement and the other Senior
Finance Documents, each Agent shall act solely as an agent of the Lenders and
does not assume and shall not be deemed to have assumed any obligation or
relationship of agency or trust with or for any Credit Party. Without limiting
the generality of the foregoing two sentences, the use of the term "agent"
herein and in the other Senior Finance Documents with reference to any Agent is
not intended to connote any fiduciary or other implied (or express) obligations
arising under agency doctrine of any applicable law. Instead, such term is used
merely as a matter of market custom, and is intended to create or reflect only
an administrative relationship between independent contracting parties. The
provisions of this Article IX (other than Section 9.10) are solely for the
benefit of the Agents and the Lenders, and none of the Credit Parties shall have
any rights as a third party beneficiary of the provisions hereof (other than
Section 9.10).
(b) Release of Collateral. The Lenders irrevocably authorize the
Collateral Agent, at the Collateral Agent's option and in its discretion, to
release any security interest in or Lien on any Collateral granted to or held by
the Collateral Agent (i) upon termination of this Agreement and the other Senior
Finance Documents, termination of the Commitments and all Letters of Credit and
payment in full of all Senior Obligations, including all fees and indemnified
costs and expenses that are payable pursuant to the terms of the Senior Finance
Documents, (ii) if such Collateral constitutes property sold or to be sold or
disposed of as part of or in connection with any disposition permitted pursuant
to the terms of this Agreement or (iii) if approved by the Required Lenders or
Lenders, as applicable, pursuant to the terms of Section 10.03. Upon the request
of the Collateral Agent, the Lenders will confirm in writing the Collateral
Agent's authority to release particular types or items of Collateral pursuant to
this Section 9.01(b).
(c) Release of Guarantors. The Lenders irrevocably authorize the
Administrative Agent, at the Administrative Agent's option and in its
discretion, to release any Guarantor from its obligations hereunder if (i) such
Guarantor is no longer required to be a Guarantor pursuant to the terms of this
Agreement or (ii) if approved by the Required Lenders or Lenders, as applicable,
pursuant to the terms of Section 10.03. Upon the request of the Administrative
Agent, the Lenders will confirm in writing the Administrative Agent's authority
to release a particular Guarantor pursuant to this Section 9.01(c).
(d) HLT Classification. Each Lender recognizes that applicable
Laws may require the Administrative Agent to determine whether the transactions
contemplated hereby should be classified as "highly leveraged" or assigned any
similar or successor classification, and that such determination may be binding
upon the other Lenders. Each Lender understands that any such determination
shall be made solely by the Administrative Agent based upon such factors (which
may include the Administrative Agent's internal policies and prevailing market
practices) as the Administrative Agent shall deem relevant and agrees that the
Administrative Agent shall have no liability for the consequences of any such
determination.
SECTION 9.02 DELEGATION OF DUTIES. An Agent may execute any of its
duties hereunder or under the other Senior Finance Documents by or through
agents, employees or attorneys-in-fact and shall be entitled to advice of
counsel and other consultants or experts concerning all matters pertaining to
such duties. An Agent shall not be responsible for the negligence or misconduct
of any agents or attorneys-in-fact selected by it in the absence of bad faith,
gross negligence or willful misconduct.
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SECTION 9.03 EXCULPATORY PROVISIONS. No Agent nor any of its or
their directors, officers, employees or agents shall be (i) liable for any
action lawfully taken or omitted to be taken by any of them under or in
connection herewith or in connection with any of the other Senior Finance
Documents or the transactions contemplated hereby or thereby (except for its own
bad faith, gross negligence or willful misconduct in connection with its duties
expressly set forth herein) or (ii) responsible in any manner to any of the
Lenders or participants for any recitals, statements, representations or
warranties made by any of the Credit Parties contained herein or in any of the
other Senior Finance Documents or in any certificate, report, document,
financial statement or other written or oral statement referred to or provided
for in, or received by an Agent under or in connection herewith or in connection
with the other Senior Finance Documents, or enforceability or sufficiency
therefor of any of the other Senior Finance Documents, or for any failure of any
Credit Party to perform its obligations hereunder or thereunder or be required
to ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or therein or
as to the use of the proceeds of the Loans or the use of the Letters of Credit
or of the existence or possible existence of any Default or Event of Default or
to inspect the properties, books or records of the Credit Parties.
SECTION 9.04 RELIANCE ON COMMUNICATIONS. The Agents shall be
entitled to rely, and shall be fully protected in relying, upon any note,
writing, resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex, teletype or e-mail message, statement, order or other
document or conversation believed by it to be genuine and correct and to have
been signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including, without limitation, counsel to any of
the Credit Parties, independent accountants and other experts selected by the
Agents). The Agents may deem and treat each Lender as the owner of its interests
hereunder for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent in
accordance with Section 10.06(b). The Agents shall be fully justified in failing
or refusing to take any action under this Agreement or under any of the other
Senior Finance Documents unless it shall first receive such advice or
concurrence of the Required Lenders as it deems appropriate or it shall first be
indemnified to its satisfaction by the Lenders against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take
any such action. The Agents shall in all cases be fully protected in acting, or
in refraining from acting, hereunder or under any of the other Senior Finance
Documents in accordance with a request of the Required Lenders (or to the extent
specifically provided in Section 10.03, all the Lenders) and such request and
any action taken or failure to act pursuant thereto shall be binding upon all
the Lenders (including their successors and assigns). Where this Agreement
expressly permits or prohibits an action unless the Required Lenders otherwise
determine, any Agent shall, and in all other instances an Agent may, but shall
not be required to, initiate any solicitation for the consent or vote of the
Lenders.
SECTION 9.05 NOTICE OF DEFAULT. An Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
hereunder, except with respect to defaults in the payment of principal, interest
and fees required to be paid to such Agent for the accounts of the Lenders,
unless such Agent has received notice from a Lender or the Borrower referring to
the Agreement, describing such Default or Event of Default and stating that such
notice is a "notice of default". If an Agent receives such a notice, such Agent
shall give prompt notice thereof to each other Agent and the Lenders. The
Administrative Agent and the Collateral Agent shall take such action with
respect to such Default or Event of Default as shall be reasonably directed by
the Required Lenders; provided, however, that unless and until the
Administrative Agent has received any such direction, the Administrative Agent
may (but shall not be obligated to) take such action, or refrain from taking
such action, with respect to such Default or Event of Default or it shall deem
advisable or in the best interest of the Lenders.
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SECTION 9.06 CREDIT DECISION; DISCLOSURE OF INFORMATION BY
ADMINISTRATIVE AGENT. Each Lender expressly acknowledges that no Agent has made
any representations or warranties to it and that no act by any Agent hereinafter
taken, including any consent to and acceptance of any assignment or review of
the affairs of any Credit Party or any Affiliate thereof, shall be deemed to
constitute any representation or warranty by any Agent to any Lender as to any
matter, including whether any Agent has disclosed material information in its
possession. Each Lender represents to the Agents that it has, independently and
without reliance upon any Agent or any other Lender, and based on such documents
and information as it has deemed appropriate, made its own appraisal of and
investigation into the business, assets, operations, property, financial and
other condition, prospects and creditworthiness of the Credit Parties, and all
requirements of Law pertaining to the Transaction, and made its own decision to
make its Loans hereunder and enter into this Agreement. Each Lender also
represents that it will, independently and without reliance upon any Agent or
any other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit analysis, appraisals
and decisions in taking or not taking action under this Agreement and the other
Senior Finance Documents, and to make such investigation as it deems necessary
to inform itself as to the business, assets, operations, property, financial and
other conditions, prospects and creditworthiness of the Borrower and the other
Credit Parties. Except for notices, reports and other documents expressly
required to be furnished to the Lenders by the Administrative Agent hereunder,
the Agents shall not have any duty or responsibility to provide any Lender with
any credit or other information concerning the business, operations, assets,
property, financial or other conditions, prospects or creditworthiness of any
Credit Party or their respective Affiliates which may come into the possession
of any Agent.
SECTION 9.07 NO RELIANCE ON ARRANGER'S OR AGENT'S CUSTOMER
IDENTIFICATION PROGRAM. Each Lender acknowledges and agrees that neither such
Lender nor any of its Affiliates, participants or assignees may rely on either
Lead Arranger or any Agent to carry out such Lender's, Affiliate's,
participant's or assignee's customer identification program, or other
obligations required or imposed under or pursuant to the U.S. Patriot Act or the
regulations thereunder, including the regulations contained in 31 C.F.R. 103.121
(as hereafter amended or replaced, the "CIP Regulations"), or any other
Anti-Terrorism Law, including any programs involving any of the following items
relating to or in connection with any of the Credit Parties, their Affiliates or
agents, the Senior Finance Documents or the transactions hereunder or
contemplated hereby: (i) any identification procedures; (ii) and recordkeeping;
(iii) comparisons with government lists, (iv) customer notices; or (v) other
procedures required under the CIP Regulations or such other Laws.
SECTION 9.08 INDEMNIFICATION. Whether or not the transactions
contemplated hereby are consummated, the Lenders agree to indemnify each Agent
(to the extent not reimbursed by the Borrower or any other Credit Party and
without limiting the obligation of the Borrower or any other Credit Party to do
so), ratably according to their respective Commitments (or if the Commitments
have expired or been terminated, in accordance with the respective principal
amounts of outstanding Loans and Participation Interests of the Lenders), from
and against any and all Indemnified Liabilities which may at any time (including
without limitation at any time following payment in full of the Senior
Obligations) be imposed on, incurred by or asserted against an Agent in its
capacity as such in any way relating to or arising out of this Agreement or the
other Senior Finance Documents or any documents contemplated by or referred to
herein or therein or the transactions contemplated hereby or thereby or any
action taken or omitted by an Agent under or in connection with any of the
foregoing; provided that no Lender shall be liable for the payment to any Agent
of any portion of such Indemnified Liabilities resulting from such Person's
gross negligence or willful misconduct; provided, however, that no action taken
in accordance with the directions of the Required Lenders shall be deemed to
constitute gross negligence or willful misconduct for purposes of this Section
9.08. If any indemnity furnished to an Agent for any purpose shall, in the
opinion of such Agent, be insufficient or become impaired, such Agent may call
for additional indemnity and cease, or not commence, to do the acts indemnified
against until such additional
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indemnity is furnished. Without limitation of the foregoing, each Lender shall
reimburse the Administrative Agent upon demand for its ratable share of any
costs or out-of-pocket expenses (including fees and disbursements of counsel)
incurred by the Administrative Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, this Agreement, any other
Senior Finance Document, or any document contemplated by or referred to herein,
to the extent that the Administrative Agent is not reimbursed for such expenses
by or on behalf of the Borrower or any other Credit Party. The agreements in
this Section 9.08 shall survive the payment of the Senior Obligations and all
other obligations and amounts payable hereunder and under the other Senior
Finance Documents.
SECTION 9.09 AGENTS IN THEIR INDIVIDUAL CAPACITY. Each Agent and its
Affiliates may make loans to, issue letters of credit for the account of, accept
deposits from, acquire Equity Interests in, and generally engage in any kind of
banking, trust, financial advisory, underwriting and other business with the
Borrower or any other Credit Party as though such Agent were not an Agent
hereunder or under another Senior Finance Document. The Lenders acknowledge
that, pursuant to any such activities, an Agent or its Affiliates may receive
information regarding any Credit Party or its Affiliates (including information
that may be subject to confidentiality obligations in favor of such Credit Party
or such Affiliate) and acknowledge that no Agent shall be under any obligation
to provide such information to them. With respect to the Loans made by and
Letters of Credit issued by and all obligations owing to it, an Agent shall have
the same rights and powers under this Agreement as any Lender and may exercise
the same as though it was not an Agent, and the terms "Lender" and "Lenders"
shall include each Agent in its individual capacity.
SECTION 9.10 SUCCESSOR AGENTS. Any Agent may, at any time, resign
upon 30 days' written notice to the Lenders. If an Agent resigns under a Senior
Finance Document, the Required Lenders shall appoint from among the Lenders a
successor Agent, which successor Agent shall be consented to by the Borrower at
all times other than during the existence of an Event of Default (which consent
of the Borrower shall not be unreasonably withheld or delayed). If no successor
Agent shall have been so appointed by the Required Lenders, and shall have
accepted such appointment prior to the effective date of the resignation of the
resigning Agent, then the resigning Agent shall have the right, after consulting
with the Lenders and the Borrower, to appoint a successor Agent; provided such
successor is a Lender hereunder or an Eligible Assignee. If no successor Agent
is appointed prior to the effective date of the resignation of the resigning
Agent, the Administrative Agent may appoint, after consulting with the Lenders
and the Borrower, a successor Agent from among the Lenders. Upon the acceptance
of any appointment as an Agent hereunder by a successor, such successor Agent
shall thereupon 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 as an Agent, as appropriate, under
this Agreement and the other Senior Finance Documents and the provisions of this
Section 9.10 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was an Agent under this Agreement. If no successor
Administrative Agent has accepted appointment as Administrative Agent within 60
days after the retiring Administrative Agent's giving notice of resignation, the
retiring Administrative Agent's resignation shall nevertheless become effective
and the Lenders shall perform all duties of the Administrative Agent hereunder
until such time, if any, as the Required Lenders appoint a successor
Administrative Agent as provided for above. Likewise, if no successor Collateral
Agent has accepted appointment as Collateral Agent within 60 days after the
retiring Collateral Agent's giving notice of resignation, the retiring
Collateral Agent's resignation shall nevertheless become effective and the
Lenders shall perform all duties of the Collateral Agent under the Collateral
Documents until such time, if any, as the Required Lenders appoint a successor
Collateral Agent as provided for above.
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SECTION 9.11 CERTAIN OTHER AGENTS. None of the Lenders identified on
the facing page or signature pages of this Agreement as a "syndication agent",
"documentation agent", "co-agent", "bookrunner", "lead manager" or "arranger"
shall have any right, power, obligation, liability, responsibility or duty under
the Agreement other than those applicable to all Lenders as such. Without
limiting the foregoing, none of the Lenders or any such Person so identified
shall have or be deemed to have any fiduciary relationship to any Lender or
Credit Party. Each Lender acknowledges that it has not relied, and will not
rely, on any of the Lenders or other Persons so identified in deciding to enter
into this Agreement or in taking or not taking action hereunder.
SECTION 9.12 AGENTS' FEES; ARRANGER FEE. The Borrower shall pay to
the Administrative Agent for its own account, to the Collateral Agent for its
own account and to the Lead Arrangers, in their capacity as Lead Arrangers, for
their own account, fees in the amounts and at the times previously agreed upon
between the Borrower and the Administrative Agent, the Collateral Agent and the
Lead Arrangers, respectively, in each case with respect to this Agreement, the
other Senior Finance Documents and the transactions contemplated hereby and
thereby.
ARTICLE X
MISCELLANEOUS
SECTION 10.01 NOTICES AND OTHER COMMUNICATIONS.
(a) General. Unless otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including by facsimile transmission) and mailed, faxed or delivered, to the
address, facsimile number or (subject to subsection (c) below) electronic mail
address specified for notices: (i) in the case of Holdings, Intermediate
Holdings, the Borrower, the Administrative Agent, or the Swingline Lender, as
set forth on the signature pages hereof, (ii) in the case of any Issuing Lender,
as set forth on the signature pages hereto, or in any applicable agreement
pursuant to which such Issuing Lender was designated as an Issuing Lender
hereunder, (iii) in the case of any Lender, as set forth in Schedule 1.01E
hereto or in any applicable Assignment and Acceptance pursuant to which such
Lender became a Lender hereunder, and (iv) in the case of any party, at such
other address as shall be designated by such party in a notice to the Borrower,
the Administrative Agent, any Issuing Lender and the Swingline Lender. All such
notices and other communications shall be deemed to be given or made upon the
earlier to occur of (i) actual receipt by the intended recipient and (ii) (A) if
delivered by hand or by courier, when signed for by the intended recipient; (B)
if delivered by mail, four Business Days after deposit in the mails, postage
prepaid; (C) if delivered by facsimile, when sent and receipt has been confirmed
by telephone; and (D) if delivered by electronic mail (which form of delivery is
subject to the provisions of subsection (c) below), when delivered; provided,
however, that notices and other communications to the Administrative Agent, any
Issuing Lender and the Swingline Lender pursuant to Article II shall not be
effective until actually received by such Person. Any notice or other
communication permitted to be given, made or confirmed by telephone hereunder
shall be given, made or confirmed by means of a telephone call to the intended
recipient at the number specified pursuant to this Section 10.01, it being
understood and agreed that a voicemail message shall in no event be effective as
a notice, communication or confirmation hereunder.
(b) Effectiveness of Facsimile Documents and Signatures. Senior
Finance Documents may be transmitted and/or signed by facsimile or signed and
delivered by electronic mail in an Adobe PDF document. The effectiveness of any
such documents and signatures shall, subject to requirements of Law, have the
same force and effect as manually-signed originals and shall be binding on all
Credit Parties, the Agents and the Lenders. The Administrative Agent may also
require that any such documents and signatures be confirmed by a manually-signed
original thereof; provided, however, that
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the failure to request or deliver the same shall not limit the effectiveness of
any facsimile document, Adobe PDF document or signature.
(c) Limited Use of Electronic Mail. Except as expressly provided
herein or as may be agreed by the Administrative Agent in its sole discretion,
electronic mail and internet and intranet websites may be used only to
distribute routine communications, such as financial statements and other
information, and to distribute Senior Finance Documents for execution by the
parties thereto, to distribute executed Senior Finance Documents in Adobe PDF
format and may not be used for any other purpose.
(d) Reliance by Agents and Lenders. The Agents and the Lenders
shall be entitled to rely and act upon any notices purportedly given by or on
behalf of the Borrower or any other Credit Party even if (i) such notices were
not made in a manner specified herein, were incomplete or were not preceded or
followed by any other form of notice specified herein or (ii) the terms thereof,
as understood by the recipient, varied from any confirmation thereof. The
Borrower shall indemnify each Agent and each Lender from all losses, costs,
expenses and liabilities resulting from the reliance by such Person on each
notice purportedly given by or on behalf of the Borrower. All telephonic notices
to and other communications with the Administrative Agent may be recorded by the
Administrative Agent, and each of the parties hereto hereby consents to such
recording.
SECTION 10.02 NO WAIVER; CUMULATIVE REMEDIES. No failure or delay on
the part of an Agent or any Lender in exercising any right, power or privilege
hereunder or under any other Senior Finance Document and no course of dealing
between the Agents or any Lender and any of the Credit Parties shall operate as
a waiver thereof; nor shall any single or partial exercise of any right, power
or privilege hereunder or under any other Senior Finance Document preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege hereunder or thereunder. The rights and remedies provided herein are
cumulative and not exclusive of any rights or remedies which the Agents or any
Lender would otherwise have. No notice to or demand on any Credit Party in any
case shall entitle the Credit Parties to any other or further notice or demand
in similar or other circumstances or constitute a waiver of the rights of the
Agents or the Lenders to any other or further action in any circumstances
without notice or demand.
SECTION 10.03 AMENDMENTS, WAIVERS AND CONSENTS. Neither this
Agreement nor any other Senior Finance Document nor any of the terms hereof or
thereof may be amended, changed, waived, discharged or terminated 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 Senior Finance Document, pursuant to an agreement or agreements in writing
entered into by Holdings, the Borrower, any other Credit Parties party thereto
and the Administrative Agent and/or the Collateral Agent, as applicable, party
thereto; provided that (i) the foregoing shall not restrict the ability of the
Required Lenders to waive any Event of Default prior to the time the
Administrative Agent shall have declared, or the Required Lenders shall have
requested the Administrative Agent to declare, the Loans immediately due and
payable pursuant to Article VIII and (ii) the Administrative Agent and the
Borrower may, with the consent of the other, amend, modify or supplement this
Agreement and any other Senior Finance Document to cure any ambiguity,
typographical error, defect or inconsistency if such amendment, modification or
supplement does not adversely affect the rights of any Agent, any Lender or any
Issuing Lender; provided, however, that:
(i) no such amendment, change, waiver, discharge or
termination shall, without the consent of each Lender directly affected
thereby:
(A) extend the final maturity of any Loan or the time
of payment of any reimbursement obligation, or any portion thereof,
arising from drawings under
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Letters of Credit, or extend or waive any Principal Amortization
Payment or any portion thereof (it being understood that only
Required Lenders are necessary to consent to the amendment or waiver
of any prepayment required under Section 2.09(b)); provided that
this clause (A) shall not restrict the ability of the Required
Lenders to waive any Event of Default (other than an Event of
Default the waiver of which would effectively result in any such
extension or waiver), prior to the time the Administrative Agent
shall have declared, or the Required Lenders shall have requested
the Administrative Agent to declare, the Loans immediately due and
payable pursuant to Article VIII;
(B) reduce the rate, or extend the time of payment, of
interest on any Loan (other than as a result of waiving the
applicability of any post-default increase in interest rates)
thereon or fees hereunder;
(C) reduce or waive the principal amount of any Loan
or any LC Disbursement;
(D) change the Commitment of a Lender from the amount
thereof in effect (it being understood and agreed that a waiver of
any Default or Event of Default or a mandatory reduction in the
Commitments shall not constitute a change in the terms of any
Commitment of any Lender);
(E) release all or substantially all of the Collateral
securing the Senior Obligations hereunder (provided that the
Collateral Agent may, without consent from any other Lender, release
any Collateral that is sold or transferred by a Credit Party in
compliance with Section 7.05 or released in compliance with Section
9.01(b));
(F) release the Borrower or substantially all of the
other Credit Parties from its or their obligations under the Senior
Finance Documents (provided that the Administrative Agent may,
without the consent of any other Lender, release any Guarantor that
is sold or transferred in compliance with Section 7.05);
(G) amend, modify or waive any provision of this
Section 10.03, or reduce any percentage specified in, or otherwise
modify, the definition of Required Lenders;
(H) consent to the assignment or transfer by the
Borrower or all or substantially all of the other Credit Parties of
any of its or their rights and obligations under (or in respect of)
the Senior Finance Documents, except as permitted thereby; or
(I) amend the priority of distributions to made
pursuant to Section 8.03 (a);
(ii) no provision of Article IX may be amended without the
consent of the Administrative Agent and the Collateral Agent, no provision
of Section 2.05 may be amended without the consent of each Issuing Lender
and no provision of Section 2.01(c) may be amended without the consent of
the Swingline Lender.
Notwithstanding the above, the right to deliver a Senior Default
Notice (as defined in the Subordination Agreement and a notice of an Extension
Period as defined in the Junior Debentures Indenture and the equivalent of a
payment blockage notice under any other Subordinated Debt), shall
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reside solely with the Administrative Agent, and the Administrative Agent shall
deliver such notice, only upon the direction of the Required Lenders.
Notwithstanding the fact that the consent of all the Lenders is
required in certain circumstances as set forth above, (i) each Lender is
entitled to vote as such Lender sees fit on any bankruptcy reorganization plan
that affects the Loans or the Letters of Credit, and each Lender acknowledges
that the provisions of Section 1126(c) of the Bankruptcy Code supersede the
unanimous consent provisions set forth herein and (ii) the Required Lenders may
consent to allow a Credit Party to use cash collateral in the context of a
bankruptcy or insolvency proceeding.
The various requirements of this Section 10.03 are cumulative. Each
Lender and each holder of a Note shall be bound by any waiver, amendment or
modification authorized by this Section 10.03 regardless of whether its Note
shall have been marked to make reference therein, and any consent by any Lender
or holder of a Note pursuant to this Section 10.03 shall bind any Person
subsequently acquiring a Note from it, whether or not such Note shall have been
so marked.
SECTION 10.04 EXPENSES. Holdings and the Borrower, jointly and
severally, agree (i) to pay or reimburse the Administrative Agent for all
reasonable out-of-pocket costs and expenses incurred in connection with the
preparation, negotiation and execution of this Agreement and the other Senior
Finance Documents and any amendment, waiver, consent or other modification of
the provisions hereof and thereof (whether or not the transactions contemplated
hereby or thereby are consummated), and the consummation of the transactions
contemplated hereby and thereby, including all reasonable fees, disbursements
and other charges of Fried, Frank, Harris, Shriver & Jacobson, LLP, counsel for
the Lead Arrangers and the Administrative Agent, and (ii) to pay or reimburse
(without duplication of any amount paid pursuant to Section 10.05) each Agent
and each Lender for all reasonable costs and expenses incurred in connection
with the enforcement, attempted enforcement or preservation of any rights or
remedies under this Agreement or the other Senior Finance Documents (including
all such costs and expenses incurred during any "workout" or restructuring in
respect of the Senior Obligations and during any legal proceeding, including any
proceeding under any bankruptcy or insolvency proceeding), including all
reasonable fees and disbursements of counsel (including the allocated charges of
internal counsel), provided that the Borrower shall not be required to reimburse
the legal fees and expenses of more than one outside counsel (in addition to up
to one local counsel in each applicable local jurisdiction) for all Persons
indemnified under this clause (ii) unless, in the written opinion of outside
counsel reasonably satisfactory to the Borrower, representation of all such
indemnified persons would be inappropriate due to the existence of an actual or
potential conflict of interest. The foregoing costs and expenses shall include
all search, filing, recording, title insurance and appraisal charges and fees
and taxes related thereto, and other out-of-pocket expenses incurred by any
Agent and the cost of independent public accountants and other outside experts
retained by or on behalf of the Agents and the Lender. The agreements in this
Section 10.04 shall survive the termination of the Commitments and repayment of
all Senior Obligations.
SECTION 10.05 INDEMNIFICATION. Whether or not the transactions
contemplated hereby are consummated, Holdings and the Borrower jointly and
severally agree to indemnify, save and hold harmless each Agent, each Lender and
their respective Affiliates, directors, officers, employees, counsel, agents,
trustees, investment advisors and attorneys-in-fact and their respective
successors and assignors (collectively, the "Indemnitees") from and against: (i)
any and all claims, demands, actions or causes of action that are asserted
against any Indemnitee by any Person (other than the Administrative Agent or any
Lender) relating directly or indirectly to a claim, demand, action or cause of
action that such Person asserts or may assert against any Credit Party, any
Affiliate of any Credit Party or any of their respective officers or directors;
(ii) any and all claims, demands, actions or causes of action that may at any
time (including at any time following repayment of the Senior Obligations and
the resignation or removal of
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any Agent or the replacement of any Lender) be asserted or imposed against any
Indemnitee, arising out of or relating to, the Senior Finance Documents, any
predecessor Senior Finance Documents, the Commitments, the use of or
contemplated use of the proceeds of any Credit Extension, or the relationship of
any Credit Party, any Agent and the Lenders under this Agreement or any other
Senior Finance Document or from any actual or alleged presence or release of
Hazardous Materials on or from any property owned or operated by any Group
Company , or any Environmental Liability related in any way to any Group
Company; (iii) any administrative or investigative proceeding by any
Governmental Authority arising out of or related to a claim, demand, action or
cause of action described in clause (i) or (ii) above; and (iv) any and all
liabilities (including liabilities under indemnities), losses, costs or expenses
(including fees and disbursements of counsel) that any Indemnitee suffers or
incurs as a result of the assertion of any foregoing claim, demand, action,
cause of action or proceeding, or as a result of the preparation of any defense
in connection with any foregoing claim, demand, action, cause of action or
proceeding, in all cases, and whether or not an Indemnitee is a party to such
claim, demand, action, cause of action, or proceeding (all the foregoing,
collectively, the "Indemnified Liabilities"); provided that no Indemnitee shall
be entitled to indemnification for any claim to the extent such claim is
determined by a court of competent jurisdiction is a final and nonappealable
judgment to have been caused by its own gross negligence, bad faith or willful
misconduct and provided further that Holdings and the Borrower shall not be
required to reimburse the legal fees and expenses of more than one outside
counsel (in addition to up to one local counsel in each applicable local
jurisdiction) for all Indemnities unless, in the written opinion of outside
counsel reasonably satisfactory to the Borrower, representation of all such
Indemnitees would be inappropriate due to the existence of an actual or
potential conflict of interest. In the case of an investigation, litigation or
other proceeding to which the indemnity in this Section 10.05 applies, such
indemnity shall be effective whether or not such investigation, litigation or
proceeding is brought by any Credit Party, its directors, shareholders or
creditors or an Indemnitee or any other Person or any Indemnitee is otherwise a
party thereto and whether or not the transactions contemplated hereby are
consummated. Each of Holdings and the Borrower agrees not to assert or permit
any of their respective Subsidiaries to assert any claim against any Agent, any
Lender, any of their Affiliates or any of their respective directors, officers,
employees, attorneys, agents and advisers, and each of the Agents and the
Lenders agrees not to assert or permit any of their respective Subsidiaries to
assert any claim against Holdings, the Borrower or any of their respective
Subsidiaries or any of their respective directors, officers, employees,
attorneys, agents, trustees or advisors, on any theory of liability, for
special, indirect, consequential or punitive damages arising out of or otherwise
relating to the Senior Finance Documents, any of the transactions contemplated
herein or therein or the actual or proposed use of the proceeds of the Loans or
the Letters of Credit. Without prejudice to the survival of any other agreement
of the Credit Parties hereunder and under the other Senior Finance Documents,
the agreements and obligations of the Credit Parties contained in this Section
10.05 shall survive the repayment of the Loans, LC Obligations and other
obligations under the Senior Finance Documents and the termination of the
Commitments hereunder.
SECTION 10.06 SUCCESSORS AND ASSIGNS.
(a) Generally. This Agreement shall be binding upon and inure to
the benefit of and be enforceable by the respective successors and assigns of
the parties hereto; provided that none of the Credit Parties may assign or
transfer any of its interests and obligations without the prior written consent
of either the Required Lenders or the Lenders, as the terms set forth in Section
10.03 may require;
(b) Assignments. Any Lender may assign all or a portion of its
rights and obligations under this Agreement (including, without limitation, all
or a portion of its Loans, its Notes, its Commitments and any Participation
Interest in Letters of Credit and Swingline Loans held by it); provided,
however, that
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(i) each such assignment shall be to an Eligible Assignee;
(ii) except in the case of an assignment to another Lender,
an Affiliate of an existing Lender or any Approved Fund (A) the aggregate
amount of the Revolving Commitment or Term B Loans of an assigning Lender
subject to each such assignments (determined as of the date the Assignment
and Acceptance with respect to such assignment is delivered to the
Administrative Agent or, if a "Trade Date" is specified in the Assignment
and Acceptance, as of the Trade Date) shall not, without the consent of
the Lead Arrangers and, if no Default or Event of Default has occurred and
is continuing, the Borrower, be less (with respect to any such Class) than
$1,000,000, and an integral multiple of $1,000,000 (or such lesser amount
as shall equal the assigning Lender's entire Revolving Commitment or Term
B Loans) and (B) after giving effect to such assignment, unless otherwise
consented to by the Borrower if no Default or Event of Default has
occurred and is continuing, the aggregate amount of the Revolving
Commitment and Term B Loans at the time owing to, the assigning Lender
shall not be less than $1,000,000 (unless the assigning Lender shall have
assigned its entire Revolving Commitment and Term B Loans at the time
owing it pursuant to such assignment or assignments otherwise complying
with this Section 10.06 executed substantially simultaneously with such
assignment); provided however, assignments in connection with the primary
syndication of the Revolving Commitments or Term B Loans (x) may be made
and may be recorded in the Register by the Administrative Agent without
any further consent or approval by the Lead Arrangers or the Borrower
notwithstanding that the amount subject to any such assignment fails to
equal or exceed $1,000,000 or any integral multiple thereof; and (y) may
be less than $1,000,000;
(iii) each such assignment by a Lender shall be of a constant,
and not varying, percentage of all rights and obligations in respect of a
particular Class of Commitments under this Agreement and the other Senior
Finance Documents; and
(iv) the parties to such assignment shall execute and deliver
to the Administrative Agent and, only with respect to any assignment of
all or a portion of the Revolving Committed Amount, the Issuing Lenders
for their acceptance an Assignment and Acceptance in the form of Exhibit
C, together with any Note subject to such assignment and a processing fee
of $3,500 (the "Assignment Fee"), payable or agreed between the assigning
Lender and the assignee (and which shall not be required to be paid by the
Borrower); provided however, if the parties of such assignment shall
electronically execute and deliver to the Administrative Agent an
Assignment and Acceptance via an electronic settlement system acceptable
to the Administrative Agent in its sole discretion (which initially shall
be Clearpar, LLC) the Assignment Fee shall be $500. No Assignment Fee
shall be payable in connection with any assignment to which Merrill Lynch,
Pierce, Fenner & Smith, Inc., Merrill Lynch Capital Corporation or any of
their affiliates are a party.
(c) Assignment and Acceptance. By executing and delivering an
Assignment and Acceptance in accordance with this Section 10.06, the assigning
Lender thereunder and the assignee thereunder shall be deemed to confirm to and
agree with each other and the other parties hereto as follows: (i) such
assigning Lender warrants that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim and the
assignee warrants that it is an Eligible Assignee; (ii) except as set forth in
clause (i) above, such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement, any of the other
Senior Finance Documents or any other instrument or document furnished pursuant
hereto or thereto, or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement, any of the other Senior
Finance Documents or any other instrument or document furnished pursuant hereto
or thereto or the financial
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condition of the Credit Parties or the performance or observance by any Credit
Party of any of its obligations under this Agreement, any of the other Senior
Finance Documents or any other instrument or document furnished pursuant hereto
or thereto; (iii) such assignee represents and warrants that it is legally
authorized to enter into such assignment agreement; (iv) such assignee confirms
that it has received a copy of this Agreement, the other Senior Finance
Documents, together with copies of the most recent financial statements
delivered pursuant to Section 6.01 and such other documents and information as
it has deemed appropriate to make its own credit analysis and decision to enter
into such Assignment and Acceptance; (v) such assignee will independently and
without reliance upon the Administrative Agent, any Issuing Lender, such
assigning Lender or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement and the
other Senior Finance Documents; (vi) such assignee appoints and authorizes each
of the Administrative Agent and the Collateral Agent to take such action on its
behalf and to exercise such powers under this Agreement or any other Senior
Finance Document as are delegated to such Persons by the terms hereof or
thereof, together with such powers as are reasonably incidental thereto; and
(vii) such assignee agrees that it will perform in accordance with their terms
all the obligations which by the terms of this Agreement and the other Senior
Finance Documents are required to be performed by it as a Lender. Upon
execution, delivery, and acceptance of such Assignment and Acceptance, the
assignee thereunder shall be a party hereto and, to the extent of such
assignment, have the obligations, rights, and benefits of a Lender hereunder and
the assigning Lender shall, to the extent of such assignment, relinquish its
rights and be released from its obligations under this Agreement. Upon the
consummation of any assignment pursuant to this Section 10.06(c), the assignor,
the Administrative Agent and the Credit Parties shall make appropriate
arrangements so that, if required, new Notes are issued to the assignor and the
assignee. If the assignee is not a United States person under Section
7701(a)(30) of the Code, it shall deliver to the Credit Parties and the
Administrative Agent certification as to exemption from deduction or withholding
of Taxes in accordance with Section 3.01. In addition, if applicable, the
assignee shall deliver to the Administrative Agent the information referred to
in Section 10.20.
(d) Register. The Borrower hereby designates the Administrative
Agent to serve as its agent, solely for purposes of this subsection 10.06(d), to
(i) maintain a register (the "Register") on which the Administrative Agent will
record the Commitments from time to time of each Lender, the Loans made by each
Lender and each repayment in respect of the principal amount of the Loans of
each Lender and to (ii) retain a copy of each Assignment and Acceptance
delivered to the Administrative Agent pursuant to this Section 10.06. Failure to
make any such recordation, or any error in such recordation, shall not affect
the Borrower's obligation in respect of such Loans. The entries in the Register
shall be conclusive, in the absence of manifest error, and the Borrower, the
Administrative Agent, the Issuing Lenders and the Lenders shall treat each
Person in whose name a Loan and the Note evidencing the same is registered as
the owner thereof for all purposes of this Agreement, notwithstanding notice or
any provision herein to the contrary. With respect to any Lender, the assignment
or other transfer of the Commitments of such Lender and the rights to the
principal of, and interest on, any Loan made and any Note issued pursuant to
this Agreement shall not be effective until such assignment or other transfer is
recorded on the Register and, except to the extent provided in this subsection
10.06(d), otherwise complies with Section 10.06, and prior to such recordation
all amounts owing to the transferring Lender with respect to such Commitments,
Loans and Notes shall remain owing to the transferring Lender. The registration
of assignment or other transfer of all or part of any Commitments, Loans and
Notes for a Lender shall be recorded by the Administrative Agent on the Register
only upon the acceptance by the Administrative Agent of a properly executed and
delivered Assignment and Acceptance and payment of the administrative fee
referred to in Section 10.06(b)(iv). The Register shall be available at the
offices where kept by the Administrative Agent for inspection by the Borrower
and any Lender at any reasonable time upon reasonable prior notice to the
Administrative Agent. The Borrower
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may not replace any Lender pursuant to Section 2.10(d), unless, with respect to
any Notes held by such Lender, the requirements of subsection 10.06(b) and this
subsection 10.06(d) have been satisfied.
(e) Participations. Each Lender may, without the consent of the
Borrower, the Issuing Lenders, the Swingline Lender or any Agent, sell
participations to one or more Persons in all or a portion of its rights,
obligations or rights and obligations under this Agreement (including all or a
portion of its Loans, its Notes, its Commitments and any Participation Interest
in Letters of Credit and Swingline Loans held by it); provided, however, 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, (iii) the participant shall be entitled to the
benefit of the right of setoff contained in Section 10.08 and the yield
protection provisions contained in Sections 3.01, 3.04 and 3.05 and to the same
extent that the Lender from which such participant acquired its participation
would be entitled to the benefits of such yield protection provisions; provided
that the Borrower shall not be required to reimburse any participant pursuant to
Sections 3.01, 3.04 or 3.05 in an amount which exceeds the amount that would
have been payable thereunder to such Lender had such Lender not sold such
participation and (iv) the Credit Parties, the Agents, the Issuing Lenders, the
Swingline Lender 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, and such Lender shall retain the sole right to
enforce the obligations of the Credit Parties relating to the Senior Obligations
owing to such Lender and to approve any amendment, modification or waiver of any
provision of this Agreement (other than amendments, modifications or waivers
decreasing the amount of principal of or the rate at which interest is payable
on such Loans or Notes, extending any scheduled principal payment date or date
fixed for the payment of interest on such Loans or Notes or extending its
Commitment).
(f) Other Assignments. Any Lender may at any time (i) assign all
or any portion of its rights under this Agreement and any Notes to a Federal
Reserve Bank, (ii) pledge or assign a security interest in all or any portion of
its interest and rights under this Agreement (including all or any portion of
its Notes, if any) to secure obligations of such Lender (including, without
limitation, any pledge or assignment to any holders of obligations owed, or
securities issued, by such Lender as collateral security for such obligations or
securities, or to any trustee for, or any other representative of such holders)
and (iii) grant to an SPC referred to in subsection (h) below identified as such
in writing from time to time by such Lender to the Administrative Agent and the
Borrower the option to provide to the Borrower all or any part of any Loans that
such Lender would otherwise be obligated to make to the Borrower pursuant to
this Agreement; provided that no such assignment, option, pledge or security
interest shall release a Lender from any of its obligations hereunder or
substitute any such Federal Reserve Bank or other Person to which such option,
pledge or assignment has been made for such Lender as a party hereto.
(g) Information. Any Lender may furnish any information concerning
any Credit Party or any of their respective Subsidiaries in the possession of
such Lender from time to time to assignees and participants (including
prospective assignees and participants), subject, however, to the provisions of
Section 10.07.
(h) Other Funding Vehicles. Notwithstanding anything to the
contrary contained herein, any Lender (a "Granting Lender") may grant to a
special purpose funding vehicle (an "SPC") the option to fund all or any part of
any Loan that such Granting Lender would otherwise be obligated to fund pursuant
to this Agreement; provided that (i) nothing herein shall constitute a
commitment by any SPC to fund any Loan, (ii) if an SPC elects not to exercise
such option or otherwise fails to fund all or any part of such Loan, the
Granting Lender shall be obligated to fund such Loan pursuant to the terms
hereof, (iii) no SPC shall have any voting rights pursuant to Section 10.01 and
(iv) with respect to notices, payments and other matters hereunder, the
Borrower, the Administrative Agent and the Lenders shall not be obligated to
deal with an SPC, but may limit their communications and other dealings relevant
to such SPC to the
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applicable Granting Lender. The funding of a Loan by an SPC hereunder shall
utilize the Revolving Commitment of the Granting Lender to the same extent that,
and as if, such Loan were funded by such Granting Lender. Each party hereto
hereby agrees that no SPC shall be liable for any indemnity or payment under
this Agreement for which a Lender would otherwise be liable for so long as, and
to the extent, the Granting Lender provides such indemnity or makes such
payment. Notwithstanding anything to the contrary contained in this Agreement,
any SPC may disclose on a confidential basis any non-public information relating
to its funding of Loans to any rating agency, commercial paper dealer or
provider of any surety or guarantee to such SPC. This subsection (h) may not be
amended without the prior written consent of each Granting Lender, all or any
part of whose Loan is being funded by an SPC at the time of such amendment.
SECTION 10.07 CONFIDENTIALITY AND DISCLOSURE. (a) Each of the
Administrative Agent and the Lenders agrees to maintain the confidentiality of
the Information (as defined below), except that Information may be disclosed (i)
to its and its Affiliates' directors, officers, employees, trustees 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); (ii) to the extent requested by any regulatory authority (in
which case the Administrative Agent or such Lender, as applicable, shall use
reasonable efforts to notify the "Borrower prior to such disclosure); (iii) to
the extent required by applicable Laws or regulations or by any subpoena or
similar legal process; (iv) to any other party to this Agreement; (v) in
connection with the exercise of any remedies hereunder or any suit, action or
proceeding relating to this Agreement or the enforcement of rights hereunder;
(vi) subject to an agreement containing provisions substantially the same as
those of this Section 10.07, to (A) any Eligible Assignee of or participant in,
or any prospective Eligible Assignee of or participant in, any of its rights or
obligations under this Agreement or (B) any direct or indirect contractual
counterparty or prospective counterparty (or such contractual counterparty's or
prospective counterparty's professional advisor) to any credit derivative
transaction relating to obligations of the Borrower; (vii) with the consent of
the Borrower; (viii) to the extent such information (A) becomes publicly
available other than as a result of a breach of this Section 10.07 or (B)
becomes available to an Agent or any Lender on a nonconfidential basis from a
source other than the Borrower; or (ix) to the National Association of Insurance
Commissioners or any other similar organization or any nationally recognized
rating agency that requires access to information about a Lender's or its
Affiliates' investment portfolio in connection with ratings issued with respect
to such Lender or its Affiliates. For the purposes of this Section 10.07,
"Information" means all information received from the Borrower or any of its
Affiliates relating to the Borrower or any of its Affiliates or their respective
businesses, other than any such information that is available to the
Administrative Agent or any Lender on a nonconfidential basis prior to
disclosure by the Borrower or any of its Affiliates; provided that, in the case
of information received from the Borrower after the date hereof, such
information is clearly identified in writing at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information
as provided in this Section 10.07 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. Notwithstanding the foregoing, any Agent and
any Lender may place advertisements in financial and other newspapers and
periodicals or on a home page or similar place for dissemination of information
on the Internet or worldwide web as it may choose, and circulate similar
promotional materials, after the closing of the transactions contemplated by
this Agreement in the form of a "tombstone" or otherwise describing the names of
the Credit Parties, or any of them, and the amount, type and closing date of
such transactions, all at their sole expense.
(b) Notwithstanding the foregoing or any other contrary provision
in this Agreement or any other Senior Finance Documents, the parties hereto
hereby agree that, from the commencement of discussions with respect to the
Transactions and the Senior Finance Documents, each of the parties hereto
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and each of their respective employees, representatives and other agents may
disclose to any and all Persons, without limitation of any kind, the tax
treatment and tax structure (as such terms are used in Sections 6011, 6111 and
6112 of the Code and the Treasury Regulations promulgated thereunder) of the
Senior Finance Documents and the Transaction and all materials of any kind
(including opinions or other tax analyses) that are provided to any of the
parties hereto relating to such tax treatment and tax structure, other than any
information for which nondisclosure is reasonably necessary in order to comply
with applicable securities laws; provided, however, that for this purpose the
U.S. federal income tax treatment and U.S. federal income tax structure shall
not include (i) the identity of any existing or future party (or affiliate of
such party) to this Agreement or (ii) any specific market pricing information,
including the amount of any fees, expenses, rates or payments, arising in
connection with this Agreement or the transactions contemplated hereby.
SECTION 10.08 SET-OFF. In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence and during the continuance of an Event of
Default, each Lender (and each of its Affiliates) is authorized at any time and
from time to time, without presentment, demand, protest or other notice of any
kind (all of such rights being hereby expressly waived), to set-off and to
appropriate and apply any and all deposits (general or specific, but excluding
Exempt Deposit Accounts as defined in the Security Agreement) and any other
indebtedness at any time held or owing by such Lender (including, without
limitation, branches, agencies or Affiliates of such Lender wherever located) to
or for the credit or the account of any Credit Party against obligations and
liabilities of such Credit Party then due to the Lenders hereunder, under the
Notes, under the other Senior Finance Documents or otherwise, and any such
set-off shall be deemed to have been made immediately upon the occurrence of an
Event of Default even though such charge is made or entered on the books of such
Lender subsequent thereto. The Credit Parties hereby agree that to the extent
permitted by law any Person purchasing a participation in the Loans, Commitments
and LC Obligations hereunder pursuant to Section 2.01(c), 2.05(a) or (e), 2.13
or 10.06(e) may exercise all rights of set-off with respect to its participation
interest as fully as if such Person were a Lender hereunder and any such set-off
shall reduce the amount owed by such Credit Party to the Lender.
SECTION 10.09 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 that are treated as interest
on such Loan under applicable law (collectively, the "Charges"), shall exceed
the maximum lawful rate (the "Maximum Rate") that may be charged or contracted
for, charged or otherwise received 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 10.09, 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 Lender
shall have received such cumulated amount, together with interest thereon at the
Federal Funds Rate to the date of payment.
SECTION 10.10 COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which when so executed and delivered shall be an
original, but all of which shall constitute one and the same instrument. It
shall not be necessary in making proof of this Agreement to produce or account
for more than one such counterpart.
SECTION 10.11 INTEGRATION. This Agreement, together with the other
Senior Finance Documents, comprises the complete and integrated agreement of the
parties on the subject matter hereof and thereof and supersedes all prior
agreements, written or oral, on such subject matter. In the event of any
conflict between the provisions of this Agreement and those of any other Senior
Finance Document,
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the provisions of this Agreement shall control; provided that the inclusion of
supplemental rights or remedies in favor of the Administrative Agent or the
Lenders in any other Senior Finance Document shall not be deemed a conflict with
this Agreement. Each Senior Finance Document was drafted with the joint
participation of the respective parties thereto and shall be construed neither
against nor in favor of any party, but rather in accordance with the fair
meaning thereof.
SECTION 10.12 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made hereunder and in any other Senior Finance
Document or other document delivered pursuant hereto or thereto or in connection
herewith or therewith shall survive the execution and delivery hereof and
thereof. Such representations and warranties have been or will be relied upon by
the Agents and each Lender, regardless of any investigation made by any Agent or
any Lender or on their behalf and notwithstanding that any Agent or any Lender
may have had notice or knowledge of any Default or Event of Default at the time
of any Credit Extension, and shall continue in full force and effect as long as
any Loan or any other Senior Obligation shall remain unpaid or unsatisfied or
any Letter of Credit shall remain outstanding.
SECTION 10.13 SEVERABILITY. Any provision of this Agreement and the
other Senior Finance Documents to which any Credit Party is a party that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions thereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 10.14 HEADINGS. The headings of the sections and subsections
hereof are provided for convenience only and shall not in any way affect the
meaning or construction of any provision of this Agreement.
SECTION 10.15 DEFAULTING LENDERS. Each Lender understands and agrees
that if such Lender is a Defaulting Lender then, notwithstanding the provisions
of Section 10.03, it shall not be entitled to vote on any matter requiring the
consent of the Required Lenders or to object to any matter requiring the consent
of all the Lenders adversely affected thereby; provided, however, that all other
benefits and obligations under the Senior Finance Documents shall apply to such
Defaulting Lender, except as provided in Section 2.03(e).
SECTION 10.16 GOVERNING LAW; SUBMISSION TO JURISDICTION.
(a) THIS AGREEMENT AND THE OTHER SENIOR FINANCE DOCUMENTS (OTHER
THAN LETTERS OF CREDIT AND OTHER THAN AS EXPRESSLY SET FORTH IN SUCH OTHER
SENIOR FINANCE DOCUMENTS) AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING, WITHOUT
LIMITATION, SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES. EACH LETTER OF CREDIT
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED IN ACCORDANCE WITH, THE LAWS OR
RULES DESIGNATED IN SUCH LETTER OF CREDIT, OR IF NO SUCH LAWS OR RULES ARE
DESIGNATED, THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS (1993
REVISION), INTERNATIONAL CHAMBER OF COMMERCE, PUBLICATION NO. 500 AND, AS TO
MATTERS NOT GOVERNED BY SUCH UNIFORM CUSTOMS, THE INTERNAL LAWS OF THE STATE OF
NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF
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LAWS PRINCIPLES. Any legal action or proceeding with respect to this Agreement
or any other Senior Finance Document may be brought in the courts of the State
of New York in New York County, or of the United States for the Southern
District of New York and, by execution and delivery of this Agreement, each of
Holdings and the Borrower hereby irrevocably accepts for itself and in respect
of its property, generally and unconditional, the nonexclusive jurisdiction of
such courts. Each of Holdings and the Borrower irrevocably waives, to the
fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of the venue of any such proceeding brought in such court and
any claim that any such proceeding brought in any such court has been brought in
an inconvenient forum.
(b) Each of Holdings and the Borrower hereby irrevocably consents
and agrees that any and all process which may be served in any suit, action or
proceeding of the nature referred to in this Section 10.16 may be served by the
mailing of a copy thereof by registered or certified mail, postage prepaid,
return receipt requested, to Holdings' or the Borrower's address referred to in
Section 10.03, as the case may be. Each of Holdings and the Borrower agrees that
such service (i) shall be deemed in every respect effective service of process
upon it in any such suit, action or proceeding and (ii) shall, to the fullest
extent permitted by law, be taken and held to be valid personal service upon and
personal delivery to it. Nothing in this Section 10.16 shall affect the right of
any Lender to serve process in any manner permitted by law or limit the right of
any Lender to bring proceedings against Holdings or the Borrower in the courts
of any jurisdiction or jurisdictions.
SECTION 10.17 WAIVER OF JURY TRIAL. EACH PARTY TO THIS AGREEMENT
HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION ARISING UNDER ANY SENIOR FINANCE DOCUMENT OR IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR
ANY OF THEM WITH RESPECT TO ANY SENIOR FINANCE DOCUMENT, OR THE TRANSACTIONS
RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES
AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE
DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY
FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT
TO TRIAL BY JURY. EACH PARTY HERETO 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 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 10.18 BINDING EFFECT. This Agreement shall become effective
at such time when it shall have been executed by Holdings, Intermediate
Holdings, the Borrower, and the Administrative Agent shall have received copies
hereof (telefaxed or otherwise) which, when taken together, bear the signatures
of each Lender, and thereafter this Agreement shall be binding upon and inure to
the benefit of Holdings, Intermediate Holdings, the Borrower, each Agent and
each Lender and their respective successors and assigns; provided, however,
unless the conditions set forth in Section 4.01 have been satisfied by the
Credit Parties or waived by the Lenders on or before April 2, 2004, none of
Holdings, the Borrower, the Agents or the Lenders shall have any obligations
under this Agreement.
SECTION 10.19 LENDERS' U.S. PATRIOT ACT COMPLIANCE CERTIFICATION.
Each Lender or assignee or participant of a Lender that is not incorporated
under the Laws of the United States or a State thereof (and is not excepted from
the certification requirement contained in Section 313 of the U.S.
-139-
Patriot Act and the applicable regulations because it is both (i) an Affiliate
of a depository institution or foreign bank that maintains a physical presence
in the United States or foreign country and (ii) subject to supervision by a
banking regulatory authority regulating such affiliated depository institution
or foreign bank) shall deliver to the Administrative Agent the certification or,
if applicable, recertification, certifying that such Lender is not a "shell" and
certifying to other matters as required by Section 313 of the U.S. Patriot Act
and the applicable regulations thereunder: (i) within 10 days after the Closing
Date or, if later, the date such Lender, assignee or participant of a Lender
becomes a Lender, assignee or participant of a Lender hereunder and (ii) at such
other times as are required under the U.S. Patriot Act.
SECTION 10.20 U.S. PATRIOT ACT NOTICE. Each Senior Finance Party
(for itself and not on behalf of any other Senior Finance Party) hereby notifies
each of Holdings and the Borrower that, pursuant to the requirements of the U.S.
Patriot Act, such Senior Finance Party is required to obtain, verify and record
information that identifies each of Holdings and each other Credit Party, which
information includes the name and address of each such Credit Party and other
information that will allow such Senior Finance Party to identify each such
Credit Party in accordance with the U.S. Patriot Act.
[Signature Pages Follow]
-140-
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.
THE HILLMAN GROUP, INC.
By: /s/ Max W. Hillman
--------------------------------
Name:
Title:
10590 Hamilton Avenue
Cincinnati, Ohio 45231-0012
THE HILLMAN COMPANIES, INC.
By: /s/ Max W. Hillman
--------------------------------
Name:
Title:
10590 Hamilton Avenue
Cincinnati, Ohio 45231-0012
HILLMAN INVESTMENT COMPANY
By: /s/ Max W. Hillman
--------------------------------
Name:
Title:
10590 Hamilton Avenue
Cincinnati, Ohio 45231-0012
CREDIT AGREEMENT SIGNATURE PAGES
MERRILL LYNCH CAPITAL, a division of
Merrill Lynch Business Financial Services Inc.,
as Issuing Lender
By: /s/ Joseph N. Lazewski
--------------------------------
Name: Joseph N. Lazewski
Title: Assistant Vice President
222 N. LaSalle Street
16th Floor
Chicago, IL 60601
CREDIT AGREEMENT SIGNATURE PAGES
MERRILL LYNCH CAPITAL, a division of
Merrill Lynch Business Financial Services Inc.,
as Swingline Lender
By: /s/ Joseph N. Lazewski
--------------------------------
Name: Joseph N. Lazewski
Title: Assistant Vice President
222 N. LaSalle Street
16th Floor
Chicago, IL 60601
CREDIT AGREEMENT SIGNATURE PAGES
MERRILL LYNCH CAPITAL, a division of
Merrill Lynch Business Financial Services Inc.,
as Administrative Agent
By: /s/ Joseph N. Lazewski
--------------------------------
Name: Joseph N. Lazewski
Title: Assistant Vice President
222 N. LaSalle Street
16th Floor
Chicago, IL 60601
CREDIT AGREEMENT SIGNATURE PAGES
JPMORGAN CHASE BANK,
as Syndication Agent
By: /S/ KATHRYN A. DUNCAN
---------------------------------
Name:
Title:
270 Park Avenue
New York, NY 10017
CREDIT AGREEMENT SIGNATURE PAGES
MERRILL LYNCH & CO., MERRILL LYNCH,
PIERCE, FENNER & SMITH INCORPORATED,
as Joint Lead Arranger and Joint
Bookrunner
By: /S/ SARANG R. GADKARI
--------------------------------
Name:
Title:
CREDIT AGREEMENT SIGNATURE PAGES
J.P. MORGAN SECURITIES,
as Joint Lead Arranger and Joint
Bookrunner
By: /s/ ADAM G. SELL
--------------------------------
Name:
Title:
CREDIT AGREEMENT SIGNATURE PAGES
MERRILL LYNCH CAPITAL CORPORATION,
as Lender
By: /s/ Lawrence Temlock
--------------------------------
Name: Lawrence Temlock
Title: Vice President
Four World Financial Center
250 Vesey Street
New York, NY 10080
CREDIT AGREEMENT SIGNATURE PAGES
MERRILL LYNCH CAPITAL, a division of
Merrill Lynch Business Financial Services Inc.,
as Lender
By: /s/ Joseph N. Lazewski
--------------------------------
Name: Joseph N. Lazewski
Title: Assistant Vice President
222 N. LaSalle Street
16th Floor
Chicago, IL 60601
CREDIT AGREEMENT SIGNATURE PAGES
JPMORGAN CHASE BANK,
as Lender
By: /s/ KATHRYN A. DUNCAN
----------------------------------
Name:
Title:
270 Park Avenue
New York, NY 10017
CREDIT AGREEMENT SIGNATURE PAGES
ING CAPITAL LLC,
as Lender
By: /s/ Steven Fleenor
--------------------------------
Name: Steven Fleenor
Title: Managing Director
333 South Grand Avenue
Suite 4120
Los Angles, CA 90071
CREDIT AGREEMENT SIGNATURE PAGES
GENERAL ELECTRIC CAPITAL
CORPORATION,
as Lender
By: /s/ Brian Schwinn
--------------------------------
Name: Brian Schwinn
Title: Duly Authorized Signatory
General Electric Capital Corporation
Corporate Financial Services
201 Merritt 7, P.O. Box 5201
Norwalk, CT 06856-5201
CREDIT AGREEMENT SIGNATURE PAGES
PNC BANK, NATIONAL ASSOCIATION,
as Issuing Lender
By: /s/ Benjamin Willingham
--------------------------------
Name: Benjamin Willingham
Title: Senior Vice President
201 East Fifth Street
P.O. Box 1198
Cincinnati, Ohio 45201-1198
CREDIT AGREEMENT SIGNATURE PAGES
PNC BANK, NATIONAL ASSOCIATION,
as Lender
By: /s/ Benjamin Willingham
--------------------------------
Name: Benjamin Willingham
Title: Senior Vice President
201 East Fifth Street
P.O. Box 1198
Cincinnati, Ohio 45201-1198
CREDIT AGREEMENT SIGNATURE PAGES