EXECUTION COPY
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CREDIT AGREEMENT
Dated as of August 12, 2003
among
ARMOR HOLDINGS, INC.,
as the Borrower,
The Other Lenders Party Hereto,
BANK OF AMERICA, N.A.,
as Administrative Agent, Swing Line Lender
and
L/C Issuer,
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Syndication Agent,
and
KEYBANK NATIONAL ASSOCIATION,
as Documentation Agent
BANC OF AMERICA SECURITIES LLC,
as
Sole Lead Arranger and Sole Book Manager
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TABLE OF CONTENTS
Section Page
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ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS............................................................1
1.01 Defined Terms...............................................................................1
1.02 Other Interpretive Provisions..............................................................25
1.03 Accounting Terms...........................................................................25
1.04 UCC Terms..................................................................................26
1.05 Rounding...................................................................................26
1.06 References to Agreements and Laws..........................................................26
1.07 Exchange Rates; Currency Equivalents.......................................................26
1.08 Additional Alternative Currencies..........................................................27
1.09 Change of Currency.........................................................................27
1.10 Times of Day...............................................................................28
1.11 Letter of Credit Amounts...................................................................28
ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS......................................................28
2.01 Committed Loans............................................................................28
2.02 Borrowings, Conversions and Continuations of Committed Loans...............................29
2.03 Letters of Credit..........................................................................31
2.04 Swing Line Loans...........................................................................39
2.05 Prepayments................................................................................42
2.06 Termination or Reduction of Commitments....................................................44
2.07 Repayment of Loans.........................................................................44
2.08 Interest...................................................................................44
2.09 Fees.......................................................................................45
2.10 Computation of Interest and Fees...........................................................46
2.11 Evidence of Debt...........................................................................46
2.12 Payments Generally.........................................................................47
2.13 Sharing of Payments........................................................................48
2.14 Security...................................................................................49
ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY.....................................................49
3.01 Taxes......................................................................................49
3.02 Illegality.................................................................................51
3.03 Inability to Determine Rates...............................................................51
3.04 Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurocurrency Rate
Loans......................................................................................52
3.05 Compensation for Losses....................................................................53
3.06 Matters Applicable to all Requests for Compensation........................................53
3.07 Survival...................................................................................53
ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS..................................................54
4.01 Conditions of Initial Credit Extension.....................................................54
4.02 Conditions to all Credit Extensions........................................................57
ARTICLE V. REPRESENTATIONS AND WARRANTIES.............................................................58
5.01 Financial Condition........................................................................58
5.02 No Change..................................................................................59
5.03 Existence; Compliance with Law.............................................................59
5.04 Power; Authorization; Enforceable Obligations..............................................59
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5.05 No Legal Bar...............................................................................60
5.06 No Material Litigation.....................................................................60
5.07 No Default.................................................................................60
5.08 Ownership of Property; Liens...............................................................60
5.09 Intellectual Property......................................................................60
5.10 No Burdensome Restrictions.................................................................61
5.11 Taxes......................................................................................61
5.12 Federal Regulations........................................................................61
5.13 ERISA......................................................................................61
5.14 Investment Company Act; Other Regulations..................................................62
5.15 Subsidiaries...............................................................................62
5.16 Security Documents.........................................................................62
5.17 Accuracy and Completeness of Information...................................................62
5.18 Labor Relations............................................................................63
5.19 Insurance..................................................................................63
5.20 Solvency...................................................................................63
5.21 Purpose of Loans...........................................................................64
5.22 Environmental Matters......................................................................64
5.23 Regulation H...............................................................................65
5.24 Tax Shelter Regulations....................................................................65
5.25 Survival of Representations and Warranties.................................................65
ARTICLE VI. AFFIRMATIVE COVENANTS......................................................................65
6.01 Financial Statements.......................................................................65
6.02 Certificates; Other Information............................................................66
6.03 Payment of Obligations.....................................................................67
6.04 Conduct of Business and Maintenance of Existence...........................................67
6.05 Maintenance of Property; Insurance.........................................................68
6.06 Inspection of Property; Books and Records; Discussions.....................................68
6.07 Notices....................................................................................68
6.08 Environmental Laws.........................................................................69
6.09 Additional Subsidiaries....................................................................69
ARTICLE VII. NEGATIVE COVENANTS.........................................................................70
7.01 Financial Covenants........................................................................70
7.02 Limitation on Indebtedness.................................................................70
7.03 Limitation on Liens........................................................................72
7.04 Limitation on Guarantee Obligations........................................................73
7.05 Limitation on Fundamental Changes..........................................................74
7.06 Limitation on Sale of Assets...............................................................74
7.07 Limitation on Issuance of Capital Stock....................................................75
7.08 Limitation on Changes to Cash Management Practices.........................................75
7.09 Limitation on Dividends....................................................................75
7.10 Limitation on Capital Expenditures.........................................................76
7.11 Limitation on Investments, Loans and Advances..............................................76
7.12 Limitation on Optional Payments and Modifications of Debt Instruments and
Acquisition Documents......................................................................77
7.13 Limitation on Transactions with Affiliates.................................................77
7.14 Limitation on Sales and Leasebacks.........................................................77
7.15 Limitation on Changes in Fiscal Year.......................................................77
7.16 Limitation on Negative Pledge Clauses......................................................77
7.17 Limitation on Lines of Business............................................................78
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7.18 Governing Documents........................................................................78
7.19 Limitation on Subsidiary Formation.........................................................78
7.20 Limitation on Securities Issuances.........................................................78
7.21 Amendments, Payments and Prepayments of High Yield Bonds...................................78
ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES.............................................................79
8.01 Events of Default..........................................................................79
8.02 Remedies Upon Event of Default.............................................................81
8.03 Application of Funds.......................................................................81
ARTICLE IX. ADMINISTRATIVE AGENT.......................................................................82
9.01 Appointment and Authorization of Administrative Agent......................................82
9.02 Delegation of Duties.......................................................................83
9.03 Liability of Administrative Agent..........................................................83
9.04 Reliance by Administrative Agent...........................................................84
9.05 Notice of Default..........................................................................84
9.06 Credit Decision; Disclosure of Information by Administrative Agent.........................84
9.07 Indemnification of Administrative Agent....................................................85
9.08 Administrative Agent in its Individual Capacity............................................85
9.09 Successor Administrative Agent.............................................................86
9.10 Administrative Agent May File Proofs of Claim..............................................86
9.11 Collateral and Guaranty Matters............................................................87
9.12 Other Agents; Arrangers and Managers.......................................................88
ARTICLE X. MISCELLANEOUS..............................................................................88
10.01 Amendments, Etc............................................................................88
10.02 Notices and Other Communications; Facsimile Copies.........................................89
10.03 No Waiver; Cumulative Remedies.............................................................90
10.04 Attorney Costs, Expenses and Taxes.........................................................90
10.05 Indemnification by the Borrower............................................................91
10.06 Payments Set Aside.........................................................................92
10.07 Successors and Assigns.....................................................................92
10.08 Confidentiality............................................................................95
10.09 Set-off....................................................................................96
10.10 Interest Rate Limitation...................................................................96
10.11 Counterparts...............................................................................97
10.12 Integration................................................................................97
10.13 Survival of Representations and Warranties.................................................97
10.14 Severability...............................................................................97
10.15 Tax Forms..................................................................................97
10.16 Replacement of Lenders.....................................................................99
10.17 Governing Law..............................................................................99
10.18 Waiver of Right to Trial by Jury..........................................................100
10.19 Judgement Currency........................................................................100
10.20 Continuity of Contract....................................................................101
10.21 Entire Agreement..........................................................................101
SIGNATURES.............................................................................................S-1
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SCHEDULES
1.01(a) Existing Letters of Credit
1.01(b) Mandatory Cost Formulae
2.01 Commitments and Pro Rata Shares
5.01 Additions to Financial Statements
5.02 No Changes; Stock Repurchases
5.03 Existence; Compliance with Laws
5.04 Consents and Filings
5.06 Material Litigation
5.09 Intellectual Property Matters
5.15 Subsidiaries
5.19 Insurance
5.22 Environmental Matters
7.02 Indebtedness
7.03 Liens
7.04 Guarantee Obligations
7.11 Loans to Officers
10.02 Administrative Agent's Office, Certain Addresses for
Notices
EXHIBITS
FORM OF
A Committed Loan Notice
B Swing Line Loan Notice
C Note
D Compliance Certificate
E Assignment and Assumption
F Collateral Agreement
G Opinion
H Joinder Agreement
I Subsidiary Guaranty Agreement
J Charge Over Shares
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CREDIT AGREEMENT
This CREDIT AGREEMENT ("Agreement") is entered into as of August 12,
2003, among ARMOR HOLDINGS, INC., a Delaware corporation (the "Borrower"), each
lender from time to time party hereto (collectively, the "Lenders" and
individually, a "Lender"), BANK OF AMERICA, N.A., as Administrative Agent, Swing
Line Lender and L/C Issuer, Wachovia Bank, National Association, as Syndication
Agent, and KeyBank National Association, as Documentation Agent.
The Borrower has requested that the Lenders provide a revolving credit
facility, and the Lenders are willing to do so on the terms and conditions set
forth herein.
In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:
ARTICLE I.
DEFINITIONS AND ACCOUNTING TERMS
1.01 DEFINED TERMS. As used in this Agreement, the following terms
shall have the meanings set forth below:
"Acquired Business" means any Person, or any assets constituting a
business unit of any Person, acquired (whether by purchase of Capital Stock,
purchase of assets, merger or otherwise) by the Borrower or any Subsidiary of
the Borrower so long as such acquisition was permitted hereunder.
"Administrative Agent" means Bank of America in its capacity as
administrative agent under any of the Loan Documents, or any successor
administrative agent.
"Administrative Agent's Office" means, with respect to any currency,
the Administrative Agent's address and, as appropriate, account as set forth on
Schedule 10.02 with respect to such currency, or such other address or account
with respect to such currency as the Administrative Agent may from time to time
notify the Borrower and the Lenders.
"Administrative Questionnaire" means an Administrative Questionnaire in
a form supplied by the Administrative Agent.
"Affiliate" means, with respect to any Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified. "Control"
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise. "Controlling" and
"Controlled" have meanings correlative thereto. Without limiting the generality
of the foregoing, a Person shall be deemed to be Controlled by another Person if
such other Person possesses, directly or indirectly, power to vote 10% or more
of the securities having ordinary voting power for the election of directors,
managing general partners or the equivalent.
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"Agent-Related Persons" means the Administrative Agent, together with
its Affiliates (including, in the case of Bank of America in its capacity as the
Administrative Agent, the Arranger), and the officers, directors, employees,
agents and attorneys-in-fact of such Persons and Affiliates.
"Aggregate Commitments" means the Commitments of all the Lenders. On
the Closing Date the Aggregate Commitments shall be $60,000,000.
"Agreement" means this Credit Agreement, as amended, restated,
supplemented or otherwise modified from time to time.
"Alternative Currency" means (a) the Euro, (b) the Pound Sterling, and
(c) the Canadian Dollar, (d) the Japanese Yen and (e) the Mexican Peso and each
other currency (other than Dollars) that is approved in accordance with Section
1.08.
"Alternative Currency Equivalent" means, at any time, with respect to
any amount denominated in Dollars, the equivalent amount thereof in the
applicable Alternative Currency as determined by the Administrative Agent or the
L/C Issuer, as the case may be, at such time on the basis of the Spot Rate
(determined in respect of the most recent Revaluation Date) for the purchase of
such Alternative Currency with Dollars.
"Alternative Currency Sublimit" means the lesser of (a) $5,000,000 and
(b) the Aggregate Commitment, as such amount may be modified at any time or from
time to time pursuant to the terms hereof. The Alternative Currency Sublimit is
part of, and in addition to, the Aggregate Commitments.
"Applicable Rate" means, from time to time, the following percentages
per annum, based upon the ratio of Consolidated Senior Indebtedness to EBITDA as
set forth below:
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APPLICABLE RATE
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PRICING CONSOLIDATED SENIOR COMMITMENT FEE EUROCURRENCY RATE LOANS AND BASE RATE LOANS
LEVEL INDEBTEDNESS TO EBITDA LETTER OF CREDIT FEE
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3 Greater than or equal to 0.500% 1.625% 0.00%
1.5:1.0
2 Less than 1.5:1.0, but 0.375% 1.375% 0.00%
greater than 1.0:1.0
1 Less than or equal to 1.0:1.0 0.250% 1.125% 0.00%
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Any increase or decrease in the Applicable Rate resulting from a change
in the ratio of Consolidated Senior Indebtedness to EBITDA shall become
effective as of the first Business Day immediately following the date a
Compliance Certificate is delivered pursuant to Section 6.02(b); provided,
however, that if a Compliance Certificate is not delivered when due in
accordance with such Section, then Pricing Level 3 shall apply as of the first
Business Day after the date on which such Compliance Certificate was required to
have been delivered. The
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Applicable Rate in effect from the Closing Date through September 30, 2003 shall
be determined based upon Pricing Level 1. With respect to each Eurocurrency Rate
Loan, the Applicable Rate shall be increased by an amount equal to the
applicable Mandatory Cost.
"Applicable Time" means, with respect to any borrowings and payments in
any Alternative Currency, the local time in the place of settlement for such
Alternative Currency as may be determined by the Administrative Agent or the L/C
Issuer, as the case may be, to be necessary for timely settlement on the
relevant date in accordance with normal banking procedures in the place of
payment.
"Approved Fund" shall have the meaning set forth in Section 10.07(g).
"Arranger" means Banc of America Securities LLC in its capacity as sole
lead arranger, or any successor thereto.
"Assignment and Assumption" means an Assignment and Assumption
substantially in the form of Exhibit E.
"Attorney Costs" means and includes all reasonable fees, expenses and
disbursements of any law firm or other external counsel.
"Attributable Indebtedness" means, on any date, (a) 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,
and (b) in respect of any Synthetic Lease Obligation, the capitalized 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 were accounted for as a Capital Lease.
"Availability Period" means the period from and including the Closing
Date to the earliest of (a) the Maturity Date, (b) the date of termination of
the Aggregate Commitments pursuant to Section 2.06, and (c) the date of
termination of the commitment of each Lender to make Loans and of the obligation
of the L/C Issuer to make L/C Credit Extensions pursuant to Section 8.02.
"Bank of America" means Bank of America, N.A., a national banking
association, and its successors.
"Base Rate" means for any day a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest
in effect for such day as publicly announced from time to time by Bank of
America as its "prime rate." The "prime rate" is a rate set by Bank of America
based upon various factors including Bank of America'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. Any change in such rate announced by Bank of America shall take effect at
the opening of business on the day specified in the public announcement of such
change.
"Base Rate Committed Loan" means a Committed Loan that is a Base Rate
Loan.
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"Base Rate Loan" means a Loan that bears interest based on the Base
Rate. All Base Rate Loans shall be denominated in Dollars.
"Borrower" has the meaning specified in the introductory paragraph
hereto.
"Borrowing" means a Committed Borrowing or a Swing Line Borrowing, as
the context may require.
"Business Day" means any day other than a Saturday, Sunday or other day
on which commercial banks are authorized to close under the Laws of, or are in
fact closed in, the state where the Administrative Agent's Office with respect
to Obligations denominated in Dollars is located and:
(a) if such day relates to any interest rate settings as to a
Eurocurrency Rate Loan denominated in Dollars, any fundings, disbursements,
settlements and payments in Dollars in respect of any such Eurocurrency Rate
Loan, or any other dealings in Dollars to be carried out pursuant to this
Agreement in respect of any such Eurocurrency Rate Loan, means any such day on
which dealings in deposits in Dollars are conducted by and between banks in the
London interbank Eurocurrency market;
(b) if such day relates to any interest rate settings as to a
Eurocurrency Rate Loan denominated in Euro, any fundings, disbursements,
settlements and payments in Euro in respect of any such Eurocurrency Rate Loan,
or any other dealings in Euro to be carried out pursuant to this Agreement in
respect of any such Eurocurrency Rate Loan, means a TARGET Day;
(c) if such day relates to any interest rate settings as to a
Eurocurrency Rate Loan denominated in a currency other than Dollars or Euro,
means any such day on which dealings in deposits in the relevant currency are
conducted by and between banks in the London or other applicable offshore
interbank market for such currency; and
(d) if such day relates to any fundings, disbursements, settlements and
payments in a currency other than Dollars or Euro in respect of a Eurocurrency
Rate Loan denominated in a currency other than Dollars or Euro, or any other
dealings in any currency other than Dollars or Euro to be carried out pursuant
to this Agreement in respect of any such Eurocurrency Rate Loan (other than any
interest rate settings), means any such day on which banks are open for foreign
exchange business in the principal financial center of the country of such
currency.
"Canadian Dollar" means, at any time of determination, the then
official currency of Canada.
"Capital Lease" means any lease of property, real or personal, the
obligations of the lessee in respect of which are required in accordance with
GAAP to be capitalized on a balance sheet of the lessee.
"Capital Asset" means, with respect to the Borrower and its
Subsidiaries, any asset that should, in accordance with GAAP, be classified and
accounted for as a Capital Asset on a consolidated balance sheet of the Borrower
and its Subsidiaries.
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"Capital Stock" means any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all similar ownership interests in a Person (other than a corporation) and
any and all warrants or options to purchase any of the foregoing.
"Cash Collateralize" has the meaning specified in Section 2.03(g).
"Charge Over Shares" means the equitable mortgage dated as of February
12, 1999, made by the Borrower in favor of the Administrative Agent (as
successor to Canadian Imperial Bank of Commerce) for the ratable benefit of
itself and the Lenders, attached hereto as Exhibit J, as amended, restated,
supplemented or otherwise modified from time to time hereafter.
"Closing Date" means the first date all the conditions precedent in
Section 4.01 are satisfied (or, in the case of Section 4.01(d), waived by the
Person entitled to receive the applicable payment).
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" means the collateral security for all or a portion of the
Obligations pledged or granted pursuant to the Security Documents.
"Collateral Agreement" means that certain Collateral Agreement dated as
of the date hereof, executed by each of the Loan Parties, other than USDS, Inc.,
in favor of the Administrative Agent on behalf of the Lenders, attached hereto
as Exhibit F, as amended, restated, supplemented or otherwise modified from time
to time.
"Commitment" means, as to each Lender, its obligation to (a) make
Committed Loans to the Borrower pursuant to Section 2.01, (b) purchase
participations in L/C Obligations, and (c) purchase participations in Swing Line
Loans, in an aggregate principal amount at any one time outstanding not to
exceed the Dollar amount set forth opposite such Lender's name on Schedule 2.01
or in the Assignment and Assumption pursuant to which such Lender becomes a
party hereto, as applicable, as such amount may be adjusted from time to time in
accordance with this Agreement.
"Committed Borrowing" means a borrowing consisting of simultaneous
Committed Loans of the same Type, in the same currency and, in the case of
Eurocurrency Rate Loans, having the same Interest Period made by each of the
Lenders pursuant to Section 2.01.
"Committed Loan" has the meaning specified in Section 2.01.
"Committed Loan Notice" means a notice of (a) a Committed Borrowing,
(b) a conversion of Committed Loans from one Type to the other, or (c) a
continuation of Eurocurrency Rate Loans, pursuant to Section 2.02(a), which, if
in writing, shall be substantially in the form of Exhibit A.
"Compliance Certificate" means a certificate substantially in the form
of Exhibit D.
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"Consolidated Capital Expenditures" means, for any period, each
expenditure made by or committed to be made by the Borrower or any Subsidiary
during such period that, in conformity with GAAP, shall be classified as a
capital expenditure, regardless of the source of financing.
"Consolidated EBITDA" means, for any period, the sum, without
duplication, for such period of (a) Consolidated Net Income for such period, (b)
the sum of provisions for such period for income taxes, interest expense, and
depreciation and amortization expense used in determining such Consolidated Net
Income, (c) amounts deducted in such period in respect of non-cash expenses in
accordance with GAAP, (d) non-capitalized transaction costs deducted in such
period in connection with this Agreement and any Permitted Acquisitions and the
financings relating thereto, (e) the amount of any aggregate net loss during
such period arising from the sale, exchange or other disposition of Capital
Assets, and (f) non-cash expenses deducted in such period in connection with any
earn-out agreements, stock appreciation rights, "phantom" stock plans,
employment agreements, non-competition agreements, subscription and stockholders
agreements and other incentive and bonus plans and similar arrangements made in
connection with acquisitions of persons or businesses by the Borrower or its
Subsidiaries or the retention of executives, officers or employees by the
Borrower or its Subsidiaries (including, without limitation, non-compete
payments to employees and former owners); provided, however, that if, during any
Rolling Period for which Consolidated EBITDA is to be calculated, any Acquired
Business was acquired by the Borrower or any of its Subsidiaries, then
Consolidated EBITDA shall be increased by an amount equal to the sum of (A) the
Consolidated EBITDA of such Acquired Business (calculated without giving effect
to the proviso to this definition as if such Acquired Business were the
Borrower) for the four consecutive Fiscal Quarters of such Acquired Business
most recently ended, and (B) any adjustments certified to the Administrative
Agent by the chief financial officer of the Borrower that would, in the
reasonable determination of the Borrower, satisfy the requirements of Rule
11-02(a) of Regulation S-X of the Securities Act of 1933, as amended, as if
included in a registration statement filed with the Securities and Exchange
Commission; provided, that, with respect to each such calculation made prior to
one year following the date of acquisition of such Acquired Business by the
Borrower or a Subsidiary thereof, the amount set forth in this clause (ii) will
be calculated by multiplying the result obtained in subclauses (A), (B) and (C)
of this clause (ii) by a fraction, the numerator of which is the result of 365
minus the number of days elapsed since the date of such acquisition of such
Acquired Business to the end of such Rolling Period and the denominator of which
is 365.
"Consolidated Fixed Charges" means, for any period, the sum of, without
duplication, (a) the amounts deducted for the cash portion of Consolidated
Interest Expense in determining Consolidated Net Income for such period, and (b)
the amount of scheduled payments of principal of Indebtedness during such period
plus the non-interest portion of payments under Capital Leases during such
period.
"Consolidated Interest Expense" means, for any period, the amount
which, in conformity with GAAP, would be set forth opposite the caption
"interest expense" or any like caption (including, without limitation, imputed
interest included in payments under Capital Leases) on a consolidated income
statement of the Borrower and the Subsidiaries for such period, excluding (a)
the amortization of any original issue discount and (b) any offset for interest
income for such period.
6
"Consolidated Net Income" means, for any period, the consolidated net
income (or deficit) of the Borrower and the Subsidiaries for such period (taken
as a cumulative whole), determined in accordance with GAAP; provided that there
shall be excluded (a) the income (or deficit) of any Person accrued prior to the
date it becomes a Subsidiary or is merged into or consolidated with the Borrower
or any Subsidiary, (b) the income (or deficit) of any Person (other than a
Subsidiary) in which the Borrower or any Subsidiary has an ownership interest,
except to the extent that any such income has been actually received by the
Borrower or such Subsidiary in the form of dividends or similar distributions,
(c) the undistributed earnings of any Subsidiary to the extent that the
declaration or payment of dividends or similar distributions by such Subsidiary
is not at the time permitted by the terms of any Contractual Obligation or any
Law applicable to such Subsidiary, (d) any restoration to income of any
contingency reserve, except to the extent that provision for such reserve was
made out of income accrued during such period, (e) any aggregate net gain (but
not any aggregate net loss) during such period arising from the sale, exchange
or other disposition of Capital Assets (such term to include all fixed assets,
whether tangible or intangible, all inventory sold in conjunction with the
disposition of fixed assets and all securities), (f) any write-up of any asset,
(g) any net gain from the collection of the proceeds of life insurance policies,
(h) any gain arising from the acquisition of any securities, or the
extinguishment, under GAAP, of any Indebtedness, of the Borrower or any
Subsidiary, (i) in the case of a successor to the Borrower by consolidation or
merger or as a transferee of its assets, any earnings of the successor
corporation prior to such consolidation, merger or transfer of assets, and (j)
any deferred credit representing the excess of equity in any Subsidiary at the
date of acquisition over the cost of the investment in such Subsidiary.
"Consolidated Net Worth" means, at a particular date, all amounts that
would be included under "shareholders' equity" on a consolidated balance sheet
of the Borrower and its Subsidiaries determined on a consolidated basis in
accordance with GAAP as at such date.
"Consolidated Senior Indebtedness" means, as of any time, Consolidated
Total Indebtedness minus all amounts which would be included on a consolidated
balance sheet of the Borrower and its Subsidiaries as of such time prepared in
conformity with GAAP in respect of Indebtedness the payment of principal and
interest on which is stated to be subordinated to any other Indebtedness.
"Consolidated Total Indebtedness" means, at any time, the sum of the
aggregate outstanding principal amount of all Indebtedness of the Borrower and
its Subsidiaries, determined on a consolidated basis in accordance with GAAP and
all Guarantee Obligations permitted under Section 7.04(f) at such time
(calculated using the amount the applicable Loan Party would have to pay in
respect of such Guaranty Obligations if the market value of the common stock of
the Borrower was zero).
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Control" has the meaning set forth in the definition of "Affiliate."
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"Credit Extension" means each of the following: (a) a Borrowing and (b)
an L/C Credit Extension.
"Debtor Relief Laws" means the Bankruptcy Code of the United States,
and all other liquidation, conservatorship, bankruptcy, assignment for the
benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights of
creditors generally.
"Default" means any event or condition that constitutes an Event of
Default or that, with the giving of any notice, the passage of time, or both,
would be an Event of Default.
"Default Rate" means an interest rate equal to (a) the Base Rate plus
(b) the Applicable Rate, if any, applicable to Base Rate Loans plus (c) 2% per
annum; provided, however, that with respect to a Eurocurrency Rate Loan, the
Default Rate shall be an interest rate equal to the interest rate (including any
Applicable Rate and any Mandatory Cost) otherwise applicable to such Loan plus
2% per annum, in each case to the fullest extent permitted by applicable Laws.
"Defaulting Lender" means any Lender that (a) has failed to fund any
portion of the Committed Loans, participations in L/C Obligations or
participations in Swing Line Loans required to be funded by it hereunder within
one Business Day of the date required to be funded by it hereunder, (b) has
otherwise failed to pay over to the Administrative Agent or any other Lender any
other amount required to be paid by it hereunder within one Business Day of the
date when due, unless the subject of a good faith dispute, or (c) has been
deemed insolvent or become the subject of a bankruptcy or insolvency proceeding.
"Disposition" or "Dispose" means the sale, transfer, license, lease or
other disposition (including any sale and leaseback transaction) of any property
by any Person, including any sale, assignment, transfer or other disposal, with
or without recourse, of any notes or accounts receivable or any rights and
claims associated therewith.
"Disposition Proceeds" has the meaning set forth in Section 2.05(c)(v).
"Dollar" and "$" mean lawful money of the United States.
"Dollar Equivalent" means, at any time, (a) with respect to any amount
denominated in Dollars, such amount, and (b) with respect to any amount
denominated in any Alternative Currency, the equivalent amount thereof in
Dollars as determined by the Administrative Agent or the L/C Issuer, as the case
may be, at such time on the basis of the Spot Rate (determined in respect of the
most recent Revaluation Date) for the purchase of Dollars with such Alternative
Currency.
"Domestic Subsidiary" means any existing or future Subsidiary of the
Borrower that is organized under the laws of any political subdivision of the
United States.
"Eligible Assignee" has the meaning set forth in Section 10.07(g).
8
"EMU" means economic and monetary union in accordance with the Treaty
of Rome 1957, as amended by the Single European Act 1986, the Maastricht Treaty
of 1992 and the Amsterdam Treaty of 1998.
"EMU Legislation" means the legislative measures of the European
Council for the introduction of, change over to or operation of a single or
unified European currency.
"Environmental Laws" means any and all Federal, state, local,
municipal, and foreign statutes, laws, regulations, ordinances, rules,
judgments, orders, decrees, permits, concessions, grants, franchises, licenses,
agreements, governmental restrictions or other Applicable Law relating to
pollution and the protection of the environment or the release of any materials
into the environment, including those related to hazardous substances or wastes,
air emissions and discharges to waste or public systems.
"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower, any other Loan Party or any of their
respective Subsidiaries directly or indirectly resulting from or based upon (a)
violation of any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials, (c)
exposure to any Hazardous Materials, (d) the release or threatened release of
any Hazardous Materials into the environment or (e) any contract, agreement or
other consensual arrangement pursuant to which liability is assumed or imposed
with respect to any of the foregoing.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the Borrower within the meaning of
Section 4001 of ERISA or is part of a group which includes the Borrower and
which is treated as a single employer under Section 414 of the Code.
"ERISA Event" means (a) a Reportable Event with respect to a Pension
Plan; (b) a withdrawal by the Borrower or any ERISA Affiliate from a Pension
Plan subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is
in reorganization; (d) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Sections 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Title IV of ERISA, other than for PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower
or any ERISA Affiliate.
"Euro" means the lawful currency of the Participating Member States
introduced in accordance with the EMU Legislation.
9
"Eurocurrency Base Rate" has the meaning set forth in the definition of
Eurocurrency Rate.
"Eurocurrency Rate" means for any Interest Period with respect to a
Eurocurrency Rate Loan, a rate per annum determined by the Administrative Agent
pursuant to the following formula:
Eurocurrency Base Rate
Eurocurrency Rate = ------------------------------------
1.00 - Eurodollar Reserve Percentage
Where,
"Eurocurrency Base Rate" means, for such Interest Period:
(a) the applicable Screen Rate for such Interest Period;
or
(b) if the applicable Screen Rate shall not be available, the
rate per annum determined by the Administrative Agent as the rate of
interest at which deposits in the relevant currency for delivery on the
first day of such Interest Period in Same Day Funds in the approximate
amount of the Eurocurrency Rate Loan being made, continued or converted
by Bank of America and with a term equivalent to such Interest Period
would be offered by Bank of America's London Branch (or other Bank of
America branch or Affiliate) to major banks in the London or other
offshore interbank market for such currency at their request at
approximately 4:00 p.m. (London time) two Business Days prior to the
first day of such Interest Period.
"Eurodollar Reserve Percentage" means, for any day during any
Interest Period, the reserve percentage (expressed as a decimal,
carried out to five decimal places) in effect on such day, whether or
not applicable to any Lender, under regulations issued from time to
time by the FRB for determining the maximum reserve requirement
(including any emergency, supplemental or other marginal reserve
requirement) with respect to Eurocurrency funding (currently referred
to as "Eurocurrency liabilities"). The Eurocurrency Rate for each
outstanding Eurocurrency Rate Loan shall be adjusted automatically as
of the effective date of any change in the Eurodollar Reserve
Percentage.
"Eurocurrency Rate Loan" means a Loan that bears interest at a rate
based on the Eurocurrency Rate. Eurocurrency Rate Loans may be denominated in
Dollars or in an Alternative Currency. All Committed Loans denominated in an
Alternative Currency must be Eurocurrency Rate Loans.
"Event of Default" has the meaning set forth in Section 8.01.
"Exchange Offer" means the exchange of registered High Yield Bonds for
the unregistered High Yield Bonds as contemplated by the terms of the High Yield
Bond Issuance.
"Existing Credit Agreement" means the Amended and Restated Credit
Agreement dated as of August 22, 2001 (as amended by the Amendment dated as of
December 9, 2002, the Second Amendment dated as of April 25, 2003 and as may be
further amended, restated,
10
supplemented or otherwise modified from time to time), by and among the
Borrower, the lenders party thereto, the Administrative Agent, and the other
agents party thereto.
"Existing Letters of Credit" means those letters of credit described on
Schedule 1.01(a).
"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 on the Business Day next
succeeding such day; provided that (a) 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 (b) if no such rate is so published on such next succeeding Business Day,
the Federal Funds Rate for such day shall be the average rate (rounded upward,
if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on
such day on such transactions as determined by the Administrative Agent.
"Fee Letter" means the letter agreement, dated July 18, 2003, among the
Borrower, Bank of America and the Arranger.
"Fiscal Year" means the Borrower's Fiscal Year, which is the period of
twelve consecutive calendar months ending on December 31.
"Fiscal Quarter" means each of the four periods of three consecutive
calendar months which make up each Fiscal Year.
"Foreign Lender" has the meaning set forth in Section 10.15(a)(i).
"Foreign Subsidiary" means any Subsidiary that is not a Domestic
Subsidiary.
"FRB" means the Board of Governors of the Federal Reserve System of the
United States.
"Fund" shall have the meaning set forth in Section 10.07(g).
"GAAP" means generally accepted accounting principles in the United
States set forth in the opinions and pronouncements of the Accounting Principles
Board and the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board or such other
principles as may be approved by a significant segment of the accounting
profession in the United States, that are applicable to the circumstances as of
the date of determination, consistently applied.
"Governmental Approvals" means all authorizations, consents, approvals,
licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
11
"Guarantors" means, collectively, all existing and future Domestic
Subsidiaries; provided that USDS, Inc. may be released pursuant to the terms of
the Subsidiary Guaranty Agreement.
"Guarantee" means, as to any Person, (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation payable or performable by
another Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of such Person, direct or indirect, (i)
to purchase or pay (or advance or supply funds for the purchase or payment of)
such Indebtedness or other obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of
income or cash flow of the primary obligor so as to enable the primary obligor
to pay such Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person. Unless the guaranteeing instrument
contains a maximum amount of such Guarantee, the amount of any Guarantee shall
be deemed to be an amount equal to the stated or determinable amount of the
related primary obligation, or portion thereof, in respect of which such
Guarantee is made or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof as determined by the guaranteeing
Person in good faith. The term "Guarantee" as a verb has a corresponding
meaning.
"Hazardous Materials" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including gasoline, petroleum or petroleum distillates (including crude oil or
any fraction thereof), asbestos or asbestos-containing materials,
polychlorinated biphenyls, radon gas, urea-formaldehyde insulation, infectious
or medical wastes and all other material, substances or wastes of any nature
defined or regulated pursuant to any Environmental Law.
"High Yield Bond Documents" means the High Yield Bond Indenture and all
exhibits and schedules thereto and each other document, instrument, certificate
and agreement executed or delivered by the Borrower or any Subsidiary thereof in
connection with the High Yield Bond Indenture or otherwise referred to therein
or contemplated thereby (including the registration rights agreement and such
documents executed and delivered in connection with any Exchange Offer), all as
amended, restated or otherwise modified pursuant to the terms and conditions set
forth in this Agreement.
"High Yield Bond Indenture" means the Indenture in the form provided to
the Administrative Agent and the Lenders as of the Closing Date, including such
indenture as subsequently qualified under the Trust Indenture Act of 1939
pursuant to which notes registered under the Securities Act of 1933 will be
issued in exchange for the notes issued on or about the Closing Date, as each
may be amended, restated, supplemented or otherwise modified pursuant to the
terms and conditions set forth in this Agreement.
12
"High Yield Bond Issuance" has the meaning set forth in Section
4.01(f)(i).
"High Yield Bonds" means the collective reference to the senior
subordinated notes of the Borrower, due 2013, issued pursuant to the High Yield
Bond Indenture in the initial principal amount of up to $150,000,000.
"Indebtedness" means, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes, loan
agreements or other similar instruments;
(b) all direct or contingent obligations of such Person
arising under letters of credit (including standby and commercial),
bankers' acceptances, bank guaranties, surety bonds and similar
instruments;
(c) net obligations of such Person under any Swap Contract;
(d) all obligations of such Person to pay the deferred
purchase price of property or services (other than trade accounts
payable in the ordinary course of business);
(e) indebtedness (excluding prepaid interest thereon) secured
by a Lien on property owned or being purchased by such Person
(including indebtedness arising under conditional sales or other title
retention agreements), whether or not such indebtedness shall have been
assumed by such Person or is limited in recourse;
(f) Capital Leases and Synthetic Lease Obligations; and
(g) all Guarantees of such Person in respect of any of the
foregoing.
For all purposes hereof, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such Person
is a general partner or a joint venturer, unless such Indebtedness is expressly
made non-recourse to such Person. The amount of any net obligation under any
Swap Contract on any date shall be deemed to be the Swap Termination Value
thereof as of such date. The amount of any Capital Lease or Synthetic Lease
Obligation as of any date shall be deemed to be the amount of Attributable
Indebtedness in respect thereof as of such date.
"Indemnified Liabilities" has the meaning set forth in Section 10.05.
"Indemnitees" has the meaning set forth in Section 10.05.
"Insurance and Condemnation Proceeds" has the meaning set forth in
Section 2.05(c)(vi).
"Interest Payment Date" means, (a) as to any Loan other than a Base
Rate Loan, the last day of each Interest Period applicable to such Loan and the
Maturity Date; provided, however,
13
that if any Interest Period for a Eurocurrency Rate Loan exceeds three months,
the respective dates that fall every three months after the beginning of such
Interest Period shall also be Interest Payment Dates; and (b) as to any Base
Rate Loan (including a Swing Line Loan), the last Business Day of each calendar
quarter and the Maturity Date.
"Interest Period" means, as to each Eurocurrency Rate Loan, the period
commencing on the date such Eurocurrency Rate Loan is disbursed or converted to
or continued as a Eurocurrency Rate Loan and ending on the date one, two, three
or six months thereafter, as selected by the Borrower in its Committed Loan
Notice; provided that:
(a) any Interest Period that would otherwise end on a day that
is not a Business Day shall 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;
(b) any Interest Period that begins on the last Business Day
of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at the
end of such Interest Period;
(c) no Interest Period shall extend beyond the Maturity Date;
and
(d) after giving effect to all Borrowings, all conversions of
Loans from one Type to the other, and all continuations of Loans as
the same Type, there shall not be more than six Interest Periods in
effect with respect to Eurocurrency Rate Loans.
"IRS" means the United States Internal Revenue Service.
"ISP" means, with respect to any Letter of Credit, 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).
"Issuer Documents" means with respect to any Letter of Credit, the
Letter Credit Application, and any other document, agreement and instrument
entered into by the L/C Issuer and the Borrower (or any Subsidiary) or in favor
the L/C Issuer and relating to any such Letter of Credit.
"Japanese Yen" means, at any time of determination, the then official
currency of Japan.
"Joinder Agreement" means each joinder agreement executed in favor of
the Administrative Agent, for the ratable benefit of itself and the Lenders,
pursuant to requirements of Section 6.09 substantially in the form of Exhibit H.
"Laws" means, collectively, all international, foreign, Federal, state
and local statutes, treaties, rules, guidelines, regulations, ordinances, codes
and administrative or judicial precedents or authorities, 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
14
permits of, and agreements with, any Governmental Authority, in each case
whether or not having the force of law.
"L/C Advance" means, with respect to each Lender, such Lender's funding
of its participation in any L/C Borrowing in accordance with its Pro Rata Share.
All L/C Advances shall be denominated in Dollars.
"L/C Borrowing" means an extension of credit resulting from a drawing
under any Letter of Credit which has not been reimbursed on the date when made
or refinanced as a Committed Borrowing. All L/C Borrowings shall be denominated
in Dollars.
"L/C Credit Extension" means, with respect to any Letter of Credit, the
issuance thereof or extension of the expiry date thereof, or the renewal or
increase of the amount thereof.
"L/C Issuer" means Bank of America in its capacity as issuer of Letters
of Credit hereunder, or any successor issuer of Letters of Credit hereunder.
"L/C Obligations" means, as at any date of determination, the aggregate
undrawn amount of all outstanding Letters of Credit plus the aggregate of all
Unreimbursed Amounts, including all L/C Borrowings. For all purposes of this
Agreement, if on any date of determination a Letter of Credit has expired by its
terms but any amount may still be drawn thereunder by reason of the operation of
Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be "outstanding"
in the amount so remaining available to be drawn.
"Lender" has the meaning set forth in the introductory paragraph hereto
and, as the context requires, includes the L/C Issuer and the Swing Line Lender.
"Lending Office" means, as to any Lender, the office or offices of such
Lender described as such in such Lender's Administrative Questionnaire, or such
other office or offices as a Lender may from time to time notify the Borrower
and the Administrative Agent.
"Letter of Credit" means any letter of credit issued hereunder and
shall include the Existing Letters of Credit. A Letter of Credit may be a
commercial letter of credit or a standby letter of credit. Letters of Credit may
be issued in Dollars or in an Alternative Currency.
"Letter of Credit Application" means an application and agreement for
the issuance or amendment of a Letter of Credit in the form from time to time in
use by the L/C Issuer.
"Letter of Credit Expiration Date" means the day that is seven days
prior to the Maturity Date then in effect (or, if such day is not a Business
Day, the next preceding Business Day).
"Letter of Credit Sublimit" means an amount equal to the lesser of (a)
$25,000,000 and (b) the Aggregate Commitments. The Letter of Credit Sublimit is
part of, and not in addition to, the Aggregate Commitments.
"Lien" means any deed of trust, mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or other), charge,
or preference, priority or other security interest or preferential arrangement
in the nature of a security interest of any kind or
15
nature whatsoever (including any conditional sale or other title retention
agreement, and any financing lease having substantially the same economic effect
as any of the foregoing).
"Loan" means an extension of credit by a Lender to the Borrower under
Article II in the form of a Committed Loan or a Swing Line Loan.
"Loan Documents" means this Agreement, each Note, each Security
Document, each Issuer Document and the Fee Letter.
"Loan Parties" means, collectively, the Borrower and each Guarantor.
"Mandatory Cost" means, with respect to any period, the percentage rate
per annum determined in accordance with Schedule 1.01(b).
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, liabilities
(actual or contingent) or condition (financial or otherwise) of the Borrower and
its Subsidiaries taken as a whole; (b) a material impairment of the ability of
any Loan Party to perform its obligations under any Loan Document to which it is
a party; or (c) a material adverse effect upon the legality, validity, binding
effect or enforceability against any Loan Party of any Loan Document to which it
is a party.
"Material Environmental Amount" means an amount payable by the Borrower
and/or its Subsidiaries in excess of $1,000,000 for remedial costs, compliance
costs, compensatory damages, punitive damages, fines, penalties or any
combination thereof.
"Maturity Date" means August 12, 2008.
"Multiemployer Plan" means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA
Affiliate makes or is obligated to make contributions, or during the preceding
five plan years, has made or been obligated to make contributions.
"Net Cash Proceeds" means:
(a) with respect to any incurrence of any Debt by the Borrower or any
Subsidiary, the aggregate amount of all cash received by the Borrower or any
Subsidiary in respect of such Debt, net of all reasonable fees, discounts,
commissions and expenses incurred by the Borrower or such Subsidiary in
connection therewith.
(b) with respect to the sale of any asset by the Borrower or any
Subsidiary, the excess, if any, of (i) the sum of cash and cash equivalents
received in connection with such sale (including any cash received by way of
deferred payment pursuant to, or by monetization of, a note receivable or
otherwise, but only as and when so received) over (ii) the sum of (A) the
principal amount of any Indebtedness that is secured by such asset and that is
required to be repaid in connection with the sale thereof (other than
Indebtedness under the Loan Documents), (B) the out-of-pocket expenses incurred
by the Borrower or any Subsidiary in connection with such sale and (C) the
amount of any taxes incurred in connection with such transaction;
16
(c) with respect to the sale of any Capital Stock by the Borrower or
any Subsidiary, the excess of (i) the sum of the cash and cash equivalents
received in connection with such sale over (ii) the underwriting discounts and
commissions, and other out-of-pocket expenses, incurred by the Borrower or such
Subsidiary in connection with such sale; and
(d) with respect to any payment under an insurance policy or in
connection with a condemnation proceeding, the amount of cash proceeds received
by the Borrower or any Subsidiary from an insurance company or Governmental
Authority, as applicable, net of all expenses of collection.
"Note" means a promissory note made by the Borrower in favor of a
Lender evidencing Loans made by such Lender, substantially in the form of
Exhibit C.
"O'Gara Acquisition" means the acquisition by the Borrower and/or its
Subsidiaries of all of the Capital Stock of the O'Gara Companies which comprise
the Security and Products and Services Group of The Kroll-O'Gara Company,
pursuant to the O'Gara Acquisition Agreement.
"O'Gara Acquisition Agreement" means the Stock Purchase Agreement,
dated as of April 20, 2001, by and among the Borrower, Bengal Acquisition Corp.,
and The Kroll-O'Gara Company, as amended, supplemented or otherwise modified
from time to time in accordance with Section 10.11.
"O'Gara Companies": collectively, O'Gara-Hess & Eisenhardt Armoring
Company, a Delaware corporation, The O'Gara Company, an Ohio corporation, O'Gara
Security Associates, Inc., a Delaware corporation, and their respective
Subsidiaries.
"Obligations" means (a) all advances to, and debts, liabilities, fees,
commissions, obligations, covenants and duties of, any Loan Party arising under
any Loan Document or otherwise with respect to any Loan or Letter of Credit,
whether direct or indirect (including those acquired by assumption), absolute or
contingent, due or to become due, now existing or hereafter arising and
including interest and fees that accrue after the commencement by or against any
Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief
Laws naming such Person as the debtor in such proceeding, regardless of whether
such interest and fees are allowed claims in such proceeding and (b) all
existing or future payment and other obligations owing by any Loan Party under
any Swap Contract (which such Swap Contract is permitted hereunder) entered into
with any Person which was a Lender or its Affiliate at the time such Swap
Contract was entered into.
"Organization Documents" means, (a) with respect to any corporation,
the certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement; and (c) with respect to
any partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
17
organization and, if applicable, any certificate or articles of formation or
organization of such entity.
"Other Taxes" has the meaning specified in Section 3.01(b).
"Outstanding Amount" means (a) with respect to Committed Loans on any
date, the Dollar Equivalent amount of the aggregate outstanding principal amount
thereof after giving effect to any borrowings and prepayments or repayments of
such Committed Loans occurring on such date; (b) with respect to Swing Line
Loans on any date, the aggregate outstanding principal amount thereof after
giving effect to any borrowings and prepayments or repayments of such Swing Line
Loans occurring on such date; and (c) with respect to any L/C Obligations on any
date, the Dollar Equivalent amount of the aggregate outstanding amount of such
L/C Obligations on such date after giving effect to any L/C Credit Extension
occurring on such date and any other changes in the aggregate amount of the L/C
Obligations as of such date, including as a result of any reimbursements of
outstanding unpaid drawings under any Letters of Credit or any reductions in the
maximum amount available for drawing under Letters of Credit taking effect on
such date.
"Overnight Rate" means, for any day, (a) with respect to any amount
denominated in Dollars, the Federal Funds Rate, and (b) with respect to any
amount denominated in an Alternative Currency, the rate of interest per annum at
which overnight deposits in the applicable Alternative Currency, in an amount
approximately equal to the amount with respect to which such rate is being
determined, would be offered for such day by a branch or Affiliate of Bank of
America in the applicable offshore interbank market for such currency to major
banks in such interbank market. "Participant" has the meaning set forth in
Section 10.07(d).
"Participating Member State" means each state so described in any EMU
Legislation.
"PBGC" means the Pension Benefit Guaranty Corporation.
"Pension Plan" means any "employee pension benefit plan" (as such term
is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Borrower or
any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes
or has an obligation to contribute, or in the case of a multiple employer or
other plan described in Section 4064(a) of ERISA, has made contributions at any
time during the immediately preceding five plan years.
"Permitted Acquisition" means any acquisition of (a) at least 85% of
the common stock or other ownership interests of a Person, whether by way of
stock purchase, merger, consolidation, tender offer or otherwise (or any
combination of the foregoing), or (b) the assets of a Person, or of a business
unit, division or subdivision of a Person, in each case having some material
application to the manufacturing, development, distribution, marketing and sale
of law enforcement or military use products and security, investigative, risk
management, safety and similar business services and lines of business related
thereto; provided that
(i) no less than ten (10) Business Days prior to the proposed closing
date of such proposed acquisition, the Borrower shall have delivered written
notice of such proposed
18
acquisition to the Administrative Agent and the Lenders, which notice shall
include the proposed closing date of such proposed acquisition;
(ii) no later than five Business Days prior to the proposed closing
date of such proposed acquisition, the Borrower shall have delivered to the
Administrative Agent and the Lenders a Compliance Certificate for the most
recent Rolling Period preceding such proposed acquisition demonstrating, in form
and substance reasonably satisfactory thereto, pro forma compliance with each
covenant contained in Section 7.01 (both before and after giving effect to such
proposed acquisition) as if such proposed acquisition had been consummated as of
the first day of such Rolling Period, and based on, with respect to the Person
or business unit to be acquired in such acquisition, the financial statements of
such Person or business unit provided to the Borrower (so long as (A) not more
than six months and 15 days shall have elapsed from the date of such financial
statements to the date of the execution of a definitive acquisition agreement
for such acquisition and so long as the consummation of such acquisition occurs
within a reasonable time following the date of such execution, (B) the Borrower
uses its good faith efforts to obtain updated financial statements of such
Person or business unit if more than three months have elapsed from the date of
such financial statements and (C) to the extent any such updated financial
statements do not disclose a material adverse change in the business,
operations, property, liabilities, or financial condition of such Person or
business unit);
(iii) no later than five (5) Business Days prior to the proposed
closing date of such proposed acquisition the Borrower shall have delivered to
the Administrative Agent, to the extent requested by the Administrative Agent,
copies of (A) substantially final Permitted Acquisition Documents, which shall
be in form and substance reasonably satisfactory to the Administrative Agent and
shall be delivered to the Administrative Agent promptly upon the finalization
thereof, and (B) substantially complete Permitted Acquisition Diligence
Information, which shall be in form and substance reasonably satisfactory to the
Administrative Agent;
(iv) the Borrower shall have certified on or before the closing date of
such proposed acquisition, in writing and in a form reasonably acceptable to the
Administrative Agent and the Lenders, that such proposed acquisition has been
approved by the board of directors or equivalent governing body of the Person to
be acquired;
(v) no Default or Event of Default shall have occurred and be
continuing both before and after giving effect to such proposed acquisition;
(vi) the Borrower shall comply with Section 6.09; and
(vii) the Borrower shall have obtained the prior written consent of the
Administrative Agent and the Required Lenders prior to the consummation of such
proposed acquisition if (A) the aggregate purchase price of such acquisition or
series of related acquisitions (including, without limitation, all cash
payments, Capital Stock, Indebtedness and other obligations assumed, earn out
payments (valued at an amount to be agreed upon between the Borrower and the
Administrative Agent), seller financing or deferred payments, but excluding
working capital adjustments made pursuant to the terms of the Permitted
Acquisition Documents) exceeds $100,000,000 or (B) the aggregate purchase price
of all acquisitions (including, without limitation, all cash payments,
Indebtedness and other obligations assumed, earn out payments
19
(valued at an amount to be agreed upon between the Borrower and the
Administrative Agent), seller financing or deferred payments, but excluding
working capital adjustments made pursuant to the terms of the Permitted
Acquisition Documents) consummated during any Fiscal Year (including, without
limitation, such proposed acquisition) exceeds $200,000,000 (inclusive of the
purchase price of the Simula Acquisition).
Except for acquisitions for an aggregate consideration of less than
$5,000,000, if the financial statements described in clause (ii) of this proviso
were not audited, and no audit was performed on the financial condition of the
Person or business unit prior to the consummation of such acquisitions, the
definitive acquisition document shall require the seller to provide such an
audit within 75 days following such consummation, and shall contain reasonable
provisions for reserves against any purchase price adjustment resulting from
such audit.
The Simula Acquisition shall be deemed a Permitted Acquisition;
provided the Borrower has complied with the requirements of clauses (ii) through
(vi) set forth above with respect thereto.
"Permitted Acquisition Diligence Information" means with respect to any
acquisition proposed by the Borrower or any Subsidiary thereof, to the extent
applicable, all material financial information, all material environmental
reports (including, without limitation, any phase I and, to the extent
applicable, phase II reports), all material contracts, all customer lists, all
supply agreements, and all other material information, in each case, reasonably
requested to be delivered to the Administrative Agent in connection with such
proposed acquisition (except to the extent that any such information is (a)
subject to any confidentiality agreement, unless mutually agreeable arrangements
can be made to preserve such information as confidential, (b) classified or (c)
subject to any attorney-client privilege).
"Permitted Acquisition Documents" means with respect to any acquisition
proposed by the Borrower or any Subsidiary thereof, substantially final drafts
if not executed at required time of delivery the purchase agreement, sale
agreement, merger agreement or other agreement evidencing such acquisition,
including, without limitation, all legal opinions and each other document
executed, delivered, contemplated by or prepared in connection therewith and any
amendment, modification or supplement to any of the foregoing.
"Permitted Liens" means those Liens permitted pursuant to Section 7.03.
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any "employee benefit plan" (as such term is defined in
Section 3(3) of ERISA) established by the Borrower or, with respect to any such
plan that is subject to Section 412 of the Code or Title IV of ERISA, any ERISA
Affiliate.
"Pounds Sterling" means, at any time of determination, the then
official currency of the United Kingdom of Great Britain and Northern Ireland.
"Properties" has the meaning set forth in Section 5.22.
20
"Pro Rata Share" means, with respect to each Lender at any time, a
fraction (expressed as a percentage, carried out to the ninth decimal place),
the numerator of which is the amount of the Commitment of such Lender at such
time and the denominator of which is the amount of the Aggregate Commitments at
such time; provided that if the commitment of each Lender to make Loans and the
obligation of the L/C Issuer to make L/C Credit Extensions have been terminated
pursuant to Section 8.02, then the Pro Rata Share of each Lender shall be
determined based on the Pro Rata Share of such Lender immediately prior to such
termination and after giving effect to any subsequent assignments made pursuant
to the terms hereof. The initial Pro Rata Share of each Lender is set forth
opposite the name of such Lender on Schedule 2.01 or in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable.
"Qualifying Services Division Sale" means any single transaction or
series of related transactions involving the disposition of any of the entities
classified as held for sale and presented separately as discontinued operations
in the Borrower's audited financial statements for the Fiscal Year ended and as
of December 31, 2002 in accordance with Financial Accounting Standards No. 144,
as long as such entity is so held for sale and presented separately as
discontinued operations.
"Register" has the meaning set forth in Section 10.07(c).
"Reportable Event" means any of the events set forth in Section 4043(c)
of ERISA, other than events for which the 30 day notice period has been waived.
"Request for Credit Extension" means (a) with respect to a Borrowing,
conversion or continuation of Committed Loans, a Committed Loan Notice, (b) with
respect to an L/C Credit Extension, a Letter of Credit Application, and (c) with
respect to a Swing Line Loan, a Swing Line Loan Notice.
"Required Lenders" means, as of any date of determination, Lenders
having more than 50% of the Aggregate Commitments or, if the commitment of each
Lender to make Loans and the obligation of the L/C Issuer to make L/C Credit
Extensions have been terminated pursuant to Section 8.02, Lenders holding in the
aggregate more than 50% of the Total Outstandings (with the aggregate amount of
each Lender's risk participation and funded participation in L/C Obligations and
Swing Line Loans being deemed "held" by such Lender for purposes of this
definition); provided that (a) the Commitment of, and the portion of the Total
Outstandings held or deemed held by, any Defaulting Lender shall be excluded for
purposes of making a determination of Required Lenders and (b) Required Lenders
shall at all times be comprised of at least two (2) Lenders.
"Responsible Officer" means the chief executive officer, president,
chief financial officer, chief operating officer, chief accounting officer,
corporate controller, treasurer or assistant treasurer of a Loan Party. Any
document delivered hereunder that is signed by a Responsible Officer of a Loan
Party shall be conclusively presumed to have been authorized by all necessary
corporate, partnership and/or other action on the part of such Loan Party and
such Responsible Officer shall be conclusively presumed to have acted on behalf
of such Loan Party.
"Restricted Payment" has the meaning set forth in Section 7.09.
21
"Revaluation Date" means (a) with respect to any Loan, each of the
following: (i) each date of a Borrowing of a Eurocurrency Rate Loan denominated
in an Alternative Currency, (ii) each date of a continuation of a Eurocurrency
Rate Loan denominated in an Alternative Currency pursuant to Section 2.02, and
(iii) such additional dates as the Administrative Agent shall determine or the
Required Lenders shall require; and (b) with respect to any Letter of Credit,
each of the following: (i) each date of issuance of a Letter of Credit
denominated in an Alternative Currency, (ii) each date of any payment by the L/C
Issuer of any Letter of Credit denominated in an Alternative Currency, (iii) in
the case of the Existing Letters of Credit, the Closing Date, and (iv) such
additional dates as the Administrative Agent or the L/C Issuer shall determine
or the Required Lenders shall require.
"Rolling Period" means any period of four consecutive Fiscal Quarters
of the Borrower, provided, that changes in any amount calculated based on
Rolling Periods shall occur as of the date financial statements for the last
Fiscal Quarter of such Rolling Period are, or are required to be, delivered
pursuant to Section 6.01.
"Same Day Funds" means (a) with respect to disbursements and payments
in Dollars, immediately available funds, and (b) with respect to disbursements
and payments in an Alternative Currency, same day or other funds as may be
determined by the Administrative Agent or the L/C Issuer, as the case may be, to
be customary in the place of disbursement or payment for the settlement of
international banking transactions in the relevant Alternative Currency.
"Screen Rate" means, for any Interest Period:
(a) 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 the relevant
currency (for delivery on the first day of such Interest Period) with a term
equivalent to such Interest Period, determined as of approximately 11:00 a.m.
(London time) two Business Days prior to the first day of such Interest Period;
or
(b) if the rate referenced in the preceding clause (a) does not appear
on such page or service or 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 on such other page or other service that displays an average
British Bankers Association Interest Settlement Rate for deposits in the
relevant currency (for delivery on the first day of such Interest Period) with a
term equivalent to such Interest Period, determined as of approximately 11:00
a.m. (London time) two Business Days prior to the first day of such Interest
Period.
"SEC" means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
"Security Documents" means the collective reference to the Subsidiary
Guaranty Agreement and the Collateral Agreement, together with any documents
creating a Lien for the benefit of the Administrative Agent executed by any Loan
Party after the Closing Date.
22
"Simula Acquisition" means the acquisition by the Borrower and/or its
Subsidiaries of all of the Capital Stock of Simula, Inc., whether by merger or
otherwise, as disclosed by the Borrower in its July 23, 2003 press release.
"Solvent" means, as to the Borrower and its Subsidiaries on a
particular date, that any such Person (a) has capital sufficient to carry on its
business and transactions and all business and transactions in which it is about
to engage and is able to pay its debts as they mature, (b) owns property having
a value, both at fair valuation and at present fair saleable value, greater than
the amount required to pay its probable liabilities (including contingencies),
and (c) does not believe that it will incur debts or liabilities beyond its
ability to pay such debts or liabilities as they mature.
"Special Notice Currency" means at any time an Alternative Currency,
other than the currency of a country that is a member of the Organization for
Economic Cooperation and Development at such time located in North America or
Europe.
"Spot Rate" for a currency means the rate determined by the
Administrative Agent or the L/C Issuer, as applicable, to be the rate quoted by
the Person acting in such capacity as the spot rate for the purchase by such
Person of such currency with another currency through its principal foreign
exchange trading office at approximately 11:00 a.m. on the date two Business
Days prior to the date as of which the foreign exchange computation is made;
provided that the Administrative Agent or the L/C Issuer may obtain such spot
rate from another financial institution designated by the Administrative Agent
or the L/C Issuer if the Person acting in such capacity does not have as of the
date of determination a spot buying rate for any such currency; and provided
further that the L/C Issuer may use such spot rate quoted on the date as of
which the foreign exchange computation is made in the case of any Letter of
Credit denominated in an Alternative Currency.
"Subsidiary" of a Person means a corporation, partnership, joint
venture, limited liability company or other business entity of which a majority
of the shares of securities or other interests having ordinary voting power for
the election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person. Unless otherwise specified, all references herein to a
"Subsidiary" or to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of
the Borrower.
"Subsidiary Guaranty Agreement" means the Subsidiary Guaranty Agreement
dated as of the date hereof, made by the Guarantors in favor of the
Administrative Agent for the ratable benefit of itself and the Lenders,
substantially in the form of Exhibit I, as amended, restated, supplemented or
otherwise modified from time to time.
"Swap Contract" means (a) 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 or 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
23
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 (b) 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 (any such master
agreement, together with any related schedules, a "Master Agreement"), including
any such obligations or liabilities under any Master Agreement.
"Swap Termination Value" means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as the
mark-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender).
"Swing Line" means the revolving credit facility made available by the
Swing Line Lender pursuant to Section 2.04.
"Swing Line Borrowing" means a borrowing of a Swing Line Loan pursuant
to Section 2.04.
"Swing Line Lender" means Bank of America in its capacity as provider
of Swing Line Loans, or any successor swing line lender hereunder.
"Swing Line Loan" has the meaning set forth in Section 2.04(a).
"Swing Line Loan Notice" means a notice of a Swing Line Borrowing
pursuant to Section 2.04(b), which, if in writing, shall be substantially in the
form of Exhibit B.
"Swing Line Sublimit" means an amount equal to the lesser of (a)
$5,000,000 and (b) the Aggregate Commitments. The Swing Line Sublimit is part
of, and not in addition to, the Aggregate Commitments.
"Synthetic Lease Obligation" means the monetary obligation of a Person
under (a) a so-called synthetic, off-balance sheet or tax retention lease, or
(b) 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 Day" means any day on which the Trans-European Automated
Real-time Gross Settlement Express Transfer (TARGET) payment system (or, if such
payment system ceases to be operative, such other payment system (if any)
determined by the Administrative Agent to be a suitable replacement) is open for
the settlement of payments in Euro.
24
"Taxes" has the meaning specified in Section 3.01(a).
"Total Outstandings" means the aggregate Outstanding Amount of all
Loans and all L/C Obligations.
"Type" means, with respect to a Committed Loan, its character as a Base
Rate Loan a Eurocurrency Rate Loan.
"UCC" means, subject to Section 1.04, the Uniform Commercial Code in
effect in the State of New York, as amended or modified from time to time.
"United States" and "U.S." mean the United States of America.
"Unreimbursed Amount" has the meaning set forth in Section 2.03(c)(i).
1.02 OTHER INTERPRETIVE PROVISIONS. With reference to this Agreement
and each other Loan Document, unless otherwise specified herein or in such other
Loan Document:
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
(b) (i) The words "herein," "hereto," "hereof" and "hereunder" and
words of similar import when used in any Loan Document shall refer to such Loan
Document as a whole and not to any particular provision thereof.
(ii) Article, Section, Exhibit and Schedule references are to
the Loan Document in which such reference appears.
(iii) The term "including" is by way of example and not
limitation.
(iv) The term "documents" includes any and all instruments,
documents, agreements, certificates, notices, reports, financial
statements and other writings, however evidenced, whether in physical
or electronic form.
(c) In the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including;" the words "to"
and "until" each mean "to but excluding;" and the word "through" means "to and
including."
(d) Section headings herein and in the other Loan Documents are
included for convenience of reference only and shall not affect the
interpretation of this Agreement or any other Loan Document.
1.03 ACCOUNTING TERMS. (a) All accounting terms not specifically or
completely defined herein shall be construed in conformity with, and all
financial data (including financial ratios and other financial calculations)
required to be submitted pursuant to this Agreement shall be prepared in
conformity with, GAAP applied on a consistent basis, as in effect from time to
time, applied in a manner consistent with that used in preparing the audited
financial statements of the Borrower and its Subsidiaries, except as otherwise
specifically prescribed herein.
25
(b) If at any time any change in GAAP would affect the computation of
any financial ratio or requirement set forth in any Loan Document, and either
the Borrower or the Required Lenders shall so request, the Administrative Agent,
the Lenders and the Borrower shall negotiate in good faith to amend such ratio
or requirement to preserve the original intent thereof in light of such change
in GAAP (subject to the approval of the Required Lenders); provided that, until
so amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (ii) the Borrower shall
provide to the Administrative Agent and the Lenders financial statements and
other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change in GAAP.
1.04 UCC TERMS. Terms defined in the UCC in effect on the Closing Date
and not otherwise defined herein shall, unless the context otherwise indicates,
have the meanings provided by those definitions. Subject to the foregoing, the
term "UCC" refers, as of any date of determination, to the UCC then in effect.
1.05 ROUNDING. Any financial ratios required to be maintained by the
Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed herein and
rounding the result up or down to the nearest number (with a rounding-up if
there is no nearest number).
1.06 REFERENCES TO AGREEMENTS AND LAWS. Unless otherwise expressly
provided herein, (a) references to Organization Documents, agreements (including
the Loan Documents) and other contractual instruments shall be deemed to include
all subsequent amendments, restatements, extensions, supplements and other
modifications thereto, but only to the extent that such amendments,
restatements, extensions, supplements and other modifications are not prohibited
by any Loan Document; and (b) references to any Law shall include all statutory
and regulatory provisions consolidating, amending, replacing, supplementing or
interpreting such Law.
1.07 EXCHANGE RATES; CURRENCY EQUIVALENTS.
(a) The Administrative Agent or the L/C Issuer, as applicable, shall
determine the Spot Rates as of each Revaluation Date to be used for calculating
Dollar Equivalent amounts of Credit Extensions and Outstanding Amounts
denominated in Alternative Currencies. Such Spot Rates shall become effective as
of such Revaluation Date and shall be the Spot Rates employed in converting any
amounts between the applicable currencies until the next Revaluation Date to
occur. Except for purposes of financial statements delivered by Loan Parties
hereunder or calculating financial covenants hereunder or except as otherwise
provided herein, the applicable amount of any currency (other than Dollars) for
purposes of the Loan Documents shall be such Dollar Equivalent amount as so
determined by the Administrative Agent or the L/C Issuer, as applicable.
(b) Wherever in this Agreement in connection with a Committed
Borrowing, conversion, continuation or prepayment of a Eurocurrency Rate Loan or
the issuance, amendment or extension of a Letter of Credit, an amount, such as a
required minimum or
26
multiple amount, is expressed in Dollars, but such Committed Borrowing,
Eurocurrency Rate Loan or Letter of Credit is denominated in an Alternative
Currency, such amount shall be the relevant Alternative Currency Equivalent of
such Dollar amount (rounded to the nearest unit of such Alternative Currency,
with 0.5 of a unit being rounded upward), as determined by the Administrative
Agent or the L/C Issuer, as the case may be.
1.08 ADDITIONAL ALTERNATIVE CURRENCIES.
(a) The Borrower may from time to time request that Eurocurrency Rate
Loans be made and/or Letters of Credit be issued in a currency other than those
specifically listed in the definition of "Alternative Currency;" provided that
such requested currency is a lawful currency (other than Dollars) that is
readily available and freely transferable and convertible into Dollars. In the
case of any such request with respect to the making of Eurocurrency Rate Loans,
such request shall be subject to the approval of the Administrative Agent and
the Lenders; and in the case of any such request with respect to the issuance of
Letters of Credit, such request shall be subject to the approval of the
Administrative Agent and the L/C Issuer.
(b) Any such request shall be made to the Administrative Agent not
later than 11:00 a.m., 10 Business Days prior to the date of the desired Credit
Extension (or such other time or date as may be agreed by the Administrative
Agent and, in the case of any such request pertaining to Letters of Credit, the
L/C Issuer, in its or their sole discretion). In the case of any such request
pertaining to Eurocurrency Rate Loans, the Administrative Agent shall promptly
notify each Lender thereof; and in the case of any such request pertaining to
Letters of Credit, the Administrative Agent shall promptly notify the L/C Issuer
thereof. Each Lender (in the case of any such request pertaining to Eurocurrency
Rate Loans) or the L/C Issuer (in the case of a request pertaining to Letters of
Credit) shall notify the Administrative Agent, not later than 11:00 a.m., ten
Business Days after receipt of such request whether it consents, in its sole
discretion, to the making of Eurocurrency Rate Loans or the issuance of Letters
of Credit, as the case may be, in such requested currency.
(c) Any failure by a Lender or the L/C Issuer, as the case may be, to
respond to such request within the time period specified in the preceding
sentence shall be deemed to be a refusal by such Lender or the L/C Issuer, as
the case may be, to permit Eurocurrency Rate Loans to be made or Letters of
Credit to be issued in such requested currency. If the Administrative Agent and
all the Lenders consent to making Eurocurrency Rate Loans in such requested
currency, the Administrative Agent shall so notify the Borrower and such
currency shall thereupon be deemed for all purposes to be an Alternative
Currency hereunder for purposes of any Committed Borrowings of Eurocurrency Rate
Loans; and if the Administrative Agent and the L/C Issuer consent to the
issuance of Letters of Credit in such requested currency, the Administrative
Agent shall so notify the Borrower and such currency shall thereupon be deemed
for all purposes to be an Alternative Currency hereunder for purposes of any
Letter of Credit issuances. If the Administrative Agent shall fail to obtain
consent to any request for an additional currency under this Section, the
Administrative Agent shall promptly so notify the Borrower.
1.09 CHANGE OF CURRENCY.
27
(a) Each obligation of the Borrower to make a payment denominated in
the national currency unit of any member state of the European Union that adopts
the Euro as its lawful currency after the date hereof shall be redenominated
into Euro at the time of such adoption (in accordance with the EMU Legislation).
If, in relation to the currency of any such member state, the basis of accrual
of interest expressed in this Agreement in respect of that currency shall be
inconsistent with any convention or practice in the London interbank market for
the basis of accrual of interest in respect of the Euro, such expressed basis
shall be replaced by such convention or practice with effect from the date on
which such member state adopts the Euro as its lawful currency; provided that if
any Committed Borrowing in the currency of such member state is outstanding
immediately prior to such date, such replacement shall take effect, with respect
to such Committed Borrowing, at the end of the then current Interest Period.
(b) Each provision of this Agreement shall be subject to such
reasonable changes of construction as the Administrative Agent may from time to
time specify to be appropriate to reflect the adoption of the Euro by any member
state of the European Union and any relevant market conventions or practices
relating to the Euro.
(c) Each provision of this Agreement also shall be subject to such
reasonable changes of construction as the Administrative Agent may from time to
time specify to be appropriate to reflect a change in currency of any other
country and any relevant market conventions or practices relating to the change
in currency.
1.10 TIMES OF DAY. Unless otherwise specified, all references herein to
times of day shall be references to Eastern time (daylight or standard, as
applicable).
1.11 LETTER OF CREDIT AMOUNTS. Unless otherwise specified, all
references herein to the amount of a Letter of Credit at any time shall be
deemed to mean the Dollar Equivalent of the maximum face amount of such Letter
of Credit after giving effect to all increases thereof contemplated by such
Letter of Credit or the Issuer Documents related thereto, whether or not such
maximum face amount is in effect at such time.
ARTICLE II.
THE COMMITMENTS AND CREDIT EXTENSIONS
2.01 COMMITTED LOANS. Subject to the terms and conditions set forth
herein, each Lender severally agrees to make loans (each such loan, a "Committed
Loan") to the Borrower in Dollars or in one or more Alternative Currencies from
time to time, on any Business Day during the Availability Period, in an
aggregate amount not to exceed at any time outstanding the amount of such
Lender's Commitment; provided, however, that after giving effect to any
Committed Borrowing, (a) the Total Outstandings shall not exceed the Aggregate
Commitments, (b) the aggregate Outstanding Amount of the Committed Loans of any
Lender, plus such Lender's Pro Rata Share of the Outstanding Amount of all L/C
Obligations, plus such Lender's Pro Rata Share of the Outstanding Amount of all
Swing Line Loans shall not exceed such Lender's Commitment and (c) the aggregate
Outstanding Amount of all Committed Loans and L/C Obligations denominated in
Alternative Currencies shall not exceed the Alternative Currency Sublimit. Any
Committed Loan to be made in an Alternative Currency shall be funded in an
amount equal to the Alternative Currency Amount of such Committed Loan. Within
the limits of each Lender's
28
Commitment, and subject to the other terms and conditions hereof, the Borrower
may borrow under this Section 2.01, prepay under Section 2.05, and reborrow
under this Section 2.01. Committed Loans may be Base Rate Loans or Eurocurrency
Rate Loans, as further provided herein.
2.02 BORROWINGS, CONVERSIONS AND CONTINUATIONS OF COMMITTED LOANS.
(a) Each Committed Borrowing, each conversion of Committed Loans from
one Type to the other, and each continuation of Eurocurrency Rate Loans shall be
made upon the Borrower's irrevocable notice to the Administrative Agent, which
may be given by telephone. Each such notice must be received by the
Administrative Agent not later than 11:00 a.m. (i) three Business Days prior to
the requested date of any Borrowing of, conversion to or continuation of
Eurocurrency Rate Loans denominated in Dollars or of any conversion of
Eurocurrency Rate Loans denominated in Dollars to Base Rate Committed Loans,
(ii) four Business Days (or five Business Days in the case of a Special Notice
Currency) prior to the requested date of any Borrowing or continuation of
Eurocurrency Rate Loans denominated in Alternative Currencies, and (iii) on the
requested date of any Borrowing of Base Rate Committed Loans. Each telephonic
notice by the Borrower pursuant to this Section 2.02(a) must be confirmed
promptly by delivery to the Administrative Agent of a written Committed Loan
Notice, appropriately completed and signed by a Responsible Officer of the
Borrower. Except as provided in Sections 2.03(c) and 2.04(c), each Borrowing of,
conversion to or continuation of Eurocurrency Rate Loans shall be in a principal
amount of $1,000,000 or a whole multiple of $250,000 in excess thereof. Each
Committed Borrowing of or conversion to Base Rate Committed Loans shall be in a
principal amount of $500,000 or a whole multiple of $100,000 in excess thereof.
Each Committed Loan Notice (whether telephonic or written) shall specify (i)
whether the Borrower is requesting a Committed Borrowing, a conversion of
Committed Loans from one Type to the other, or a continuation of Eurocurrency
Rate Loans, (ii) the requested date of the Borrowing, conversion or
continuation, as the case may be (which shall be a Business Day), (iii) the
principal amount of Committed Loans to be borrowed, converted or continued, (iv)
the Type of Committed Loans to be borrowed or to which existing Committed Loans
are to be converted, (v) if applicable, the duration of the Interest Period with
respect thereto, and (vi) the currency of the Committed Loans to be borrowed. If
the Borrower fails to specify a currency in a Committed Loan Notice requesting a
Borrowing, then the Committed Loans so requested shall be made in Dollars. If
the Borrower fails to specify a Type of Committed Loan in a Committed Loan
Notice or if the Borrower fails to give a timely notice requesting a conversion
or continuation, then the applicable Committed Loans shall be made as, or
converted to, Base Rate Loans; provided, however, that in the case of a failure
to timely request a continuation of Committed Loans denominated in an
Alternative Currency, such Loans shall be continued as Eurocurrency Rate Loans
in their original currency with an Interest Period of one month. Any automatic
conversion to Base Rate Loans shall be effective as of the last day of the
Interest Period then in effect with respect to the applicable Eurocurrency Rate
Loans. If the Borrower requests a Borrowing of, conversion to, or continuation
of Eurocurrency Rate Loans in any such Committed Loan Notice, but fails to
specify an Interest Period, it will be deemed to have specified an Interest
Period of one month. No Committed Loan may be converted into or continued as a
Committed Loan denominated in a different currency, but instead must be prepaid
in the original currency of such Committed Loan and reborrowed in the other
currency.
29
(b) Following receipt of a Committed Loan Notice, the Administrative
Agent shall promptly notify each Lender of the amount (and currency) of its Pro
Rata Share of the applicable Committed Loans, and if no timely notice of a
conversion or continuation is provided by the Borrower, the Administrative Agent
shall notify each Lender of the details of any automatic conversion to Base Rate
Loans or continuation of Committed Loans denominated in a currency other than
Dollars, in each case as described in the preceding subsection. In the case of a
Committed Borrowing, each Lender shall make the amount of its Committed Loan
available to the Administrative Agent in Same Day Funds at the Administrative
Agent's Office for the applicable currency not later than 1:00 p.m., in the case
of any Committed Loan denominated in Dollars, and not later than the Applicable
Time specified by the Administrative Agent in the case of any Committed Loan in
an Alternative Currency, in each case on the Business Day specified in the
applicable Committed Loan Notice. Upon satisfaction of the applicable conditions
set forth in Section 4.02 (and, if such Borrowing is the initial Credit
Extension, Section 4.01), the Administrative Agent shall make all funds so
received available to the Borrower in like funds as received by the
Administrative Agent either by (i) crediting the account of the Borrower on the
books of Bank of America with the amount of such funds or (ii) wire transfer of
such funds, in each case in accordance with instructions provided to (and
reasonably acceptable to) the Administrative Agent by the Borrower; provided,
however, that if, on the date the Committed Loan Notice with respect to such
Borrowing denominated in Dollars is given by the Borrower, there are L/C
Borrowings outstanding, then the proceeds of such Borrowing, first, shall be
applied to the payment in full of any such L/C Borrowings, and, second, shall be
made available to the Borrower as provided above.
(c) Except as otherwise provided herein, a Eurocurrency Rate Loan may
be continued or converted only on the last day of an Interest Period for such
Eurocurrency Rate Loan. During the existence of a Default, no Loans may be
requested as, converted to or continued as Eurocurrency Rate Loans (whether in
Dollars or any Alternative Currency) without the consent of the Required
Lenders, and the Required Lenders may demand that any or all of the then
outstanding Eurocurrency Rate Loans denominated in an Alternative Currency be
prepaid, or redenominated into Dollars in the amount of the Dollar Equivalent
thereof, on the last day of the then current Interest Period with respect
thereto.
(d) The Administrative Agent shall promptly notify the Borrower and the
Lenders of the interest rate applicable to any Interest Period for Eurocurrency
Rate Loans upon determination of such interest rate. The determination of the
Eurocurrency Rate by the Administrative Agent shall be conclusive in the absence
of manifest error. At any time that Base Rate Loans are outstanding, the
Administrative Agent shall notify the Borrower and the Lenders of any change in
Bank of America's prime rate used in determining the Base Rate promptly
following the public announcement of such change.
(e) After giving effect to all Committed Borrowings, all conversions of
Committed Loans from one Type to the other, and all continuations of Committed
Loans as the same Type, there shall not be more than six Interest Periods in
effect with respect to Committed Loans.
30
2.03 LETTERS OF CREDIT.
(a) Letter of Credit Commitment.
(i) Subject to the terms and conditions set forth herein, (A)
the L/C Issuer agrees, in reliance upon the agreements of the other Lenders set
forth in this Section 2.03, (1) from time to time on any Business Day during the
period from the Closing Date until the Letter of Credit Expiration Date, to
issue Letters of Credit denominated in Dollars or in one or more Alternative
Currencies for the account of the Borrower or its Subsidiaries, and to amend or
extend Letters of Credit previously issued by it, in accordance with subsection
(b) below, and (2) to honor drawings under the Letters of Credit; and (B) the
Lenders severally agree to participate in Letters of Credit issued for the
account of the Borrower or its Subsidiaries and any drawings thereunder;
provided that the Borrower shall not request, and the L/C Issuer shall not be
obligated to make, any L/C Credit Extension with respect to any Letter of
Credit, and no Lender shall be obligated to participate in any Letter of Credit,
if as of the date of such L/C Credit Extension, (w) the Total Outstandings would
exceed the Aggregate Commitments, (x) the aggregate Outstanding Amount of the
Committed Loans of any Lender, plus such Lender's Pro Rata Share of the
Outstanding Amount of all L/C Obligations, plus such Lender's Pro Rata Share of
the Outstanding Amount of all Swing Line Loans would exceed such Lender's
Commitment, or (y) the Outstanding Amount of the L/C Obligations would exceed
the Letter of Credit Sublimit, or (z) the aggregate Outstanding Amount of all
L/C Obligations and all Committed Loans denominated in Alternative Currencies
would exceed the Alternative Currency Sublimit. Within the foregoing limits, and
subject to the terms and conditions hereof, the Borrower's ability to obtain
Letters of Credit shall be fully revolving, and accordingly the Borrower may,
during the foregoing period, obtain Letters of Credit to replace Letters of
Credit that have expired or that have been drawn upon and reimbursed. All
Existing Letters of Credit shall be deemed to have been issued pursuant hereto,
and from and after the Closing Date shall be subject to and governed by the
terms and conditions hereof.
(ii) The L/C Issuer shall not issue any Letter of Credit, if:
(A) subject to Section 2.03(b)(iii), the expiry date of
such requested Letter of Credit would occur more than eighteen months after the
date of issuance or last extension, unless the Required Lenders have approved
such expiry date; or
(B) such Letter of Credit is to be denominated in a
currency other than Dollars or an Alternative Currency, unless all the Lenders
have consented thereto.
(iii) The L/C Issuer shall not be under any obligation to
issue any Letter of Credit if:
(A) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or restrain the L/C
Issuer from issuing such Letter of Credit, or any Law applicable to the L/C
Issuer or any request or directive (whether or not having the force of law) from
any Governmental Authority with jurisdiction over the L/C Issuer shall prohibit,
or request that the L/C Issuer refrain from, the issuance of letters of credit
generally or such Letter of Credit in particular or shall impose upon the L/C
Issuer with respect
31
to such Letter of Credit any restriction, reserve or capital requirement (for
which the L/C Issuer is not otherwise compensated hereunder) not in effect on
the Closing Date, or shall impose upon the L/C Issuer any unreimbursed loss,
cost or expense which was not applicable on the Closing Date and which the L/C
Issuer in good faith deems material to it;
(B) the issuance of such Letter of Credit would violate
any Laws or one or more policies of the L/C Issuer;
(C) except as otherwise agreed by the Administrative
Agent and the L/C Issuer, such Letter of Credit is in an initial face amount
less than $50,000;
(D) the L/C Issuer does not as of the issuance date of
such requested Letter of Credit issue Letters of Credit in the requested
currency;
(E) such Letter of Credit contains any provisions for
automatic reinstatement of the stated amount after any drawing thereunder; or
(F) a default of any Lender's obligations to fund under
Section 2.03(c) exists or any Lender is at such time a Defaulting Lender
hereunder, unless the L/C Issuer has entered into satisfactory arrangements with
the Borrower or such Lender to eliminate the L/C Issuer's risk with respect to
such Lender.
(iv) The L/C Issuer shall not amend any Letter of Credit if
the L/C Issuer would not be permitted at such time to issue such Letter of
Credit in its amended form under the terms hereof.
(v) The L/C Issuer shall be under no obligation to amend any
Letter of Credit if (A) the L/C Issuer would have no obligation at such time to
issue such Letter of Credit in its amended form under the terms hereof, or (B)
the beneficiary of such Letter of Credit does not accept the proposed amendment
to such Letter of Credit.
(b) Procedures for Issuance and Amendment of Letters of Credit;
Auto-Extension Letters of Credit.
(i) Each Letter of Credit shall be issued or amended, as the
case may be, upon the request of the Borrower delivered to the L/C Issuer (with
a copy to the Administrative Agent) in the form of a Letter of Credit
Application, appropriately completed and signed by a Responsible Officer of the
Borrower. Such Letter of Credit Application must be received by the L/C Issuer
and the Administrative Agent (A) not later than 11:00 a.m. at least five
Business Days prior to the proposed issuance date or date of amendment, as the
case may be, of any Letter of Credit denominated in Dollars, and (B) not later
than 11:00 a.m. at least ten Business Days prior to the proposed issuance date
or date of amendment, as the case may be, of any Letter of Credit denominated in
an Alternative Currency; or in each case such later date and time as the
Administrative Agent and the L/C Issuer may agree in a particular instance in
their sole discretion. In the case of a request for an initial issuance of a
Letter of Credit, such Letter of Credit Application shall specify in form and
detail satisfactory to the L/C Issuer: (A) the proposed issuance date of the
requested Letter of Credit (which shall be a Business Day); (B) the amount and
currency thereof; (C) the expiry date thereof; (D) the name and address of the
32
beneficiary thereof; (E) the documents to be presented by such beneficiary in
case of any drawing thereunder; (F) the full text of any certificate to be
presented by such beneficiary in case of any drawing thereunder; and (G) such
other matters as the L/C Issuer may reasonably require. In the case of a request
for an amendment of any outstanding Letter of Credit, such Letter of Credit
Application shall specify in form and detail satisfactory to the L/C Issuer (A)
the Letter of Credit to be amended; (B) the proposed date of amendment thereof
(which shall be a Business Day); (C) the nature of the proposed amendment; and
(D) such other matters as the L/C Issuer may require. Additionally, the Borrower
shall furnish to the L/C Issuer and the Administrative Agent such other
documents and information pertaining to such requested Letter of Credit issuance
or amendment, including any Issuer Documents, as the L/C Issuer or the
Administrative Agent may reasonably require.
(ii) Promptly after receipt of any Letter of Credit
Application, the L/C Issuer will confirm with the Administrative Agent (by
telephone or in writing) that the Administrative Agent has received a copy of
such Letter of Credit Application from the Borrower and, if not, the L/C Issuer
will provide the Administrative Agent with a copy thereof. Unless the L/C Issuer
has received written notice from any Lender, the Administrative Agent or any
Loan Party, at least one Business Day prior to the requested date of issuance or
amendment of the applicable Letter of Credit, that one or more applicable
conditions contained in Article IV shall not then be satisfied, then, subject to
the terms and conditions hereof, the L/C Issuer shall, on the requested date,
issue a Letter of Credit for the account of the Borrower (or the applicable
Subsidiary) or enter into the applicable amendment, as the case may be, in each
case in accordance with the L/C Issuer's usual and customary business practices.
Immediately upon the issuance of each Letter of Credit, each Lender shall be
deemed to, and hereby irrevocably and unconditionally agrees to, purchase from
the L/C Issuer a risk participation in such Letter of Credit in an amount equal
to the product of such Lender's Pro Rata Share times the amount of such Letter
of Credit.
(iii) If the Borrower so requests in any applicable Letter of
Credit Application, the L/C Issuer may, in its sole and absolute discretion,
agree to issue a Letter of Credit that has automatic extension provisions (each,
an "Auto-Extension Letter of Credit"); provided that any such Auto-Extension
Letter of Credit must permit the L/C Issuer to prevent any such extension 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 "Non-Extension Notice Date") in each such twelve-month
period to be agreed upon at the time such Letter of Credit is issued. Unless
otherwise directed by the L/C Issuer, the Borrower shall not be required to make
a specific request to the L/C Issuer for any such extension. Once an
Auto-Extension Letter of Credit has been issued, the Lenders shall be deemed to
have authorized (but may not require) the L/C Issuer to permit the extension of
such Letter of Credit at any time to an expiry date not later than the Letter of
Credit Expiration Date; provided, however, that the L/C Issuer shall not permit
any such extension if (A) the L/C Issuer has determined that it would not be
permitted, or would have no obligation, at such time to issue such Letter of
Credit in its revised form (as extended) under the terms hereof (by reason of
the provisions of clauses (ii) or (iii) of Section 2.03(a) or otherwise), or (B)
it has received notice (which may be by telephone or in writing) on or before
the day that is five Business Days before the Non-Extension Notice Date (1) from
the Administrative Agent that the Required Lenders have elected not to permit
such extension or (2) from the Administrative Agent, any Lender or any Loan
Party that one or more
33
of the applicable conditions specified in Section 4.02 is not then satisfied,
and in each such case directing the L/C Issuer not to permit such extension.
(iv) 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 L/C Issuer will also deliver to the Borrower and
the Administrative Agent a true and complete copy of such Letter of Credit or
amendment.
(c) Drawings and Reimbursements; Funding of Participations.
(i) Upon receipt from the beneficiary of any Letter of Credit
of any notice of a drawing under such Letter of Credit, the L/C Issuer shall
notify the Borrower and the Administrative Agent thereof. In the case of a
Letter of Credit denominated in an Alternative Currency, the Borrower shall
reimburse the L/C Issuer in such Alternative Currency, unless (i) the L/C Issuer
(at its option) shall have specified in such notice that it will require
reimbursement in Dollars, or (ii) in the absence of any such requirement for
reimbursement in Dollars, the Borrower shall have notified the L/C Issuer
promptly following receipt of the notice of drawing that the Borrower will
reimburse the L/C Issuer in Dollars. In the case of any such reimbursement in
Dollars of a drawing under a Letter of Credit denominated in an Alternative
Currency, the L/C Issuer shall notify the Borrower of the Dollar Equivalent of
the amount of the drawing promptly following the determination thereof. Not
later than 11:00 a.m. on the date of any payment by the L/C Issuer under a
Letter of Credit to be reimbursed in Dollars, or the Applicable Time on the date
of any payment by the L/C Issuer under a Letter of Credit to be reimbursed in an
Alternative Currency (each such date, an "Honor Date"), the Borrower shall
reimburse the L/C Issuer through the Administrative Agent in an amount equal to
the amount of such drawing and in the applicable currency. If the Borrower fails
to so reimburse the L/C Issuer by such time on the Honor Date, the L/C Issuer
shall so notify the Administrative Agent (with a copy to the Borrower), and
specify in such notice the amount of the unreimbursed drawing (expressed in
Dollars in the amount of the Dollar Equivalent thereof in the case of a Letter
of Credit denominated in an Alternative Currency) (the "Unreimbursed Amount").
Immediately upon receipt of such notice from the L/C Issuer, the Administrative
Agent shall promptly notify each Lender of the Honor Date, the amount of the
Unreimbursed Amount, and the amount of such Lender's Pro Rata Share thereof. In
such event, the Borrower shall be deemed to have requested a Committed Borrowing
of Base Rate Loans to be disbursed on the Honor Date in an amount equal to the
Unreimbursed Amount, without regard to the minimum and multiples specified in
Section 2.02 for the principal amount of Base Rate Loans, but subject to the
amount of the unutilized portion of the Aggregate Commitments and the conditions
set forth in Section 4.02 (other than the delivery of a Committed Loan Notice).
Any notice given by the L/C Issuer or the Administrative Agent pursuant to this
Section 2.03(c)(i) may be given by telephone if immediately confirmed in
writing; provided that the lack of such an immediate confirmation shall not
affect the conclusiveness or binding effect of such notice.
(ii) Each Lender (including the Lender acting as L/C Issuer)
shall upon any notice pursuant to Section 2.03(c)(i) make funds available to the
Administrative Agent for the account of the L/C Issuer, in Dollars, at the
Administrative Agent's Office for Dollar-denominated payments in an amount equal
to its Pro Rata Share of the Unreimbursed Amount not later than 1:00 p.m. on the
Business Day specified in such notice by the Administrative
34
Agent, whereupon, subject to the provisions of Section 2.03(c)(iii), each Lender
that so makes funds available shall be deemed to have made a Base Rate Committed
Loan to the Borrower in such amount. The Administrative Agent shall remit the
funds so received to the L/C Issuer in Dollars, or if requested by the L/C
Issuer, the equivalent amount thereof in an Alternative Currency as determined
by the Administrative Agent at such time on the basis of the Spot Rate
(determined as of such funding date) for the purchase of such Alternative
Currency with Dollars.
(iii) With respect to any Unreimbursed Amount that is not
fully refinanced by a Committed Borrowing of Base Rate Loans because the
conditions set forth in Section 4.02 cannot be satisfied or for any other
reason, the Borrower shall be deemed to have incurred from the L/C Issuer an L/C
Borrowing in the amount of the Unreimbursed Amount that is not so refinanced,
which L/C Borrowing shall be due and payable on demand (together with interest)
and shall bear interest at the Default Rate. In such event, each Lender's
payment to the Administrative Agent for the account of the L/C Issuer pursuant
to Section 2.03(c)(ii) shall be deemed payment in respect of its participation
in such L/C Borrowing and shall constitute an L/C Advance from such Lender in
satisfaction of its participation obligation under this Section 2.03.
(iv) Until each Lender funds its Committed Loan or L/C Advance
pursuant to this Section 2.03(c) to reimburse the L/C Issuer for any amount
drawn under any Letter of Credit, interest in respect of such Lender's Pro Rata
Share of such amount shall be solely for the account of the L/C Issuer.
(v) Each Lender's obligation to make Committed Loans or L/C
Advances to reimburse the L/C Issuer for amounts drawn under Letters of Credit,
as contemplated by this Section 2.03(c), shall be absolute and unconditional and
shall not be affected by any circumstance, including (A) any set-off,
counterclaim, recoupment, defense or other right which such Lender may have
against the L/C Issuer, the Borrower, any Subsidiary or any other Person for any
reason whatsoever; (B) the occurrence or continuance of a Default, or (C) any
other occurrence, event or condition, whether or not similar to any of the
foregoing; provided, however, that each Lender's obligation to make Committed
Loans pursuant to this Section 2.03(c) is subject to the conditions set forth in
Section 4.02 (other than delivery by the Borrower of a Committed Loan Notice).
No such making of an L/C Advance shall relieve or otherwise impair the
obligation of the Borrower to reimburse the L/C Issuer for the amount of any
payment made by the L/C Issuer under any Letter of Credit, together with
interest as provided herein.
(vi) If any Lender fails to make available to the
Administrative Agent for the account of the L/C Issuer any amount required to be
paid by such Lender pursuant to the foregoing provisions of this Section 2.03(c)
by the time specified in Section 2.03(c)(ii), the L/C Issuer shall be entitled
to recover from such Lender (acting through the Administrative Agent), on
demand, such amount with interest thereon for the period from the date such
payment is required to the date on which such payment is immediately available
to the L/C Issuer at a rate per annum equal to the applicable Overnight Rate
from time to time in effect. A certificate of the L/C Issuer submitted to any
Lender (through the Administrative Agent) with respect to any amounts owing
under this clause (vi) shall be conclusive absent manifest error.
35
(d) Repayment of Participations.
(i) At any time after the L/C Issuer has made a payment under
any Letter of Credit and has received from any Lender such Lender's L/C Advance
in respect of such payment in accordance with Section 2.03(c), if the
Administrative Agent receives for the account of the L/C Issuer any payment in
respect of the related Unreimbursed Amount or interest thereon (whether directly
from the Borrower or otherwise, including proceeds of Cash Collateral applied
thereto by the Administrative Agent), the Administrative Agent will distribute
to such Lender its Pro Rata Share thereof (appropriately adjusted, in the case
of interest payments, to reflect the period of time during which such Lender's
L/C Advance was outstanding) in Dollars and in the same funds as those received
by the Administrative Agent.
(ii) If any payment received by the Administrative Agent for
the account of the L/C Issuer pursuant to Section 2.03(c)(i) is required to be
returned under any of the circumstances described in Section 10.06 (including
pursuant to any settlement entered into by the L/C Issuer in its discretion),
each Lender shall pay to the Administrative Agent for the account of the L/C
Issuer its Pro Rata Share thereof on demand of the Administrative Agent, plus
interest thereon from the date of such demand to the date such amount is
returned by such Lender, at a rate per annum equal to the applicable Overnight
Rate from time to time in effect.
(e) Obligations Absolute. The obligation of the Borrower to reimburse
the L/C Issuer for each drawing under each Letter of Credit and to repay each
L/C Borrowing shall be absolute, unconditional and irrevocable, and shall be
paid strictly in accordance with the terms of this Agreement under all
circumstances, including the following:
(i) any lack of validity or enforceability of such Letter of
Credit, this Agreement, or any other Loan Document;
(ii) the existence of any claim, counterclaim, set-off,
defense or other right that the Borrower or any Subsidiary may have at any time
against any beneficiary or any transferee of such Letter of Credit (or any
Person for whom any such beneficiary or any such transferee may be acting), the
L/C Issuer or any other Person, whether in connection with this Agreement, the
transactions contemplated hereby or by such Letter of Credit or any agreement or
instrument relating thereto, or any unrelated transaction;
(iii) any draft, demand, certificate or other document
presented under such Letter of Credit proving to be forged, fraudulent, invalid
or insufficient in any respect or any statement therein being untrue or
inaccurate in any respect; or any loss or delay in the transmission or otherwise
of any document required in order to make a drawing under such Letter of Credit;
(iv) any payment by the L/C Issuer under such Letter of Credit
against presentation of a draft or certificate that does not strictly comply
with the terms of such Letter of Credit; or any payment made by the L/C Issuer
under such Letter of Credit to any Person purporting to be a trustee in
bankruptcy, debtor-in-possession, assignee for the benefit of creditors,
liquidator, receiver or other representative of or successor to any beneficiary
or any
36
transferee of such Letter of Credit, including any arising in connection with
any proceeding under any Debtor Relief Law;
(v) any adverse change in the relevant exchange rates or in
the availability of the relevant Alternative Currency to the Borrower or any
Subsidiary or in the relevant currency markets generally; or
(vi) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing, including any other circumstance that
might otherwise constitute a defense available to, or a discharge of, the
Borrower or any Subsidiary.
The Borrower shall promptly examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Borrower's instructions or other irregularity, the
Borrower will immediately notify the L/C Issuer. The Borrower shall be
conclusively deemed to have waived any such claim against the L/C Issuer and its
correspondents unless such notice is given as aforesaid.
(f) Role of L/C Issuer. Each Lender and the Borrower agree that, in
paying any drawing under a Letter of Credit, the L/C Issuer shall not have any
responsibility to obtain any document (other than any sight draft, certificates
and documents expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document. None of the L/C Issuer,
any Agent-Related Person nor any of the respective correspondents, participants
or assignees of the L/C Issuer shall be liable to any Lender for (i) any action
taken or omitted in connection herewith at the request or with the approval of
the Lenders or the Required Lenders, as applicable; (ii) any action taken or
omitted in the absence of gross negligence or willful misconduct; or (iii) the
due execution, effectiveness, validity or enforceability of any document or
instrument related to any Letter of Credit or Letter of Credit Application. The
Borrower hereby assumes all risks of the acts or omissions of any beneficiary or
transferee with respect to its use of any Letter of Credit; provided, however,
that this assumption is not intended to, and shall not, preclude the Borrower's
pursuing such rights and remedies as it may have against the beneficiary or
transferee at law or under any other agreement. None of the L/C Issuer, any
Agent-Related Person, nor any of the respective correspondents, participants or
assignees of the L/C Issuer, shall be liable or responsible for any of the
matters described in clauses (i) through (v) of Section 2.03(e); provided,
however, that anything in such clauses to the contrary notwithstanding, the
Borrower may have a claim against the L/C Issuer, and the L/C Issuer may be
liable to the Borrower, to the extent, but only to the extent, of any direct, as
opposed to consequential or exemplary, damages suffered by the Borrower which
the Borrower proves were caused by the L/C Issuer's willful misconduct or gross
negligence or the L/C Issuer's willful failure to pay under any Letter of Credit
after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of
Credit. In furtherance and not in limitation of the foregoing, the L/C Issuer
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, and the L/C Issuer shall not be responsible for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason.
37
(g) Cash Collateral. Upon the request of the Administrative Agent, (i)
if the L/C Issuer has honored any full or partial drawing request under any
Letter of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if,
as of the Letter of Credit Expiration Date, (A) any Letter of Credit for any
reason remains outstanding and partially or wholly undrawn or (B) any amount
remains available to be drawn under any Letter of Credit by reason of the
operation of Rule 3.14 of the ISP, the Borrower shall immediately Cash
Collateralize the then Outstanding Amount of all L/C Obligations (in an amount
equal to such Outstanding Amount determined as of the date of such L/C Borrowing
or the Letter of Credit Expiration Date, as the case may be). The Administrative
Agent may, at any time and from time to time after the initial deposit of Cash
Collateral, request that additional Cash Collateral be provided in order to
protect against the results of exchange rate fluctuations. Sections 2.05 and
8.02(c) set forth certain additional requirements to deliver Cash Collateral
hereunder. For purposes of this Section 2.03, Section 2.05 and Section 8.02(c),
"Cash Collateralize" means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the L/C Issuer and the Lenders, as
collateral for the L/C Obligations, cash or deposit account balances pursuant to
documentation in form and substance reasonably satisfactory to the
Administrative Agent and the L/C Issuer (which documents are hereby consented to
by the Lenders). Derivatives of such term have corresponding meanings. The
Borrower hereby grants to the Administrative Agent, for the benefit of the L/C
Issuer and the Lenders, a security interest in all such cash, deposit accounts
and all balances therein and all proceeds of the foregoing. Cash Collateral
shall be maintained in blocked, non-interest bearing deposit accounts at Bank of
America.
(h) Applicability of ISP and UCP. Unless otherwise expressly agreed by
the L/C Issuer and the Borrower when a Letter of Credit is issued (including any
such agreement applicable to an Existing Letter of Credit), (i) the rules of the
ISP 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 at the time of issuance shall apply to
each commercial Letter of Credit.
(i) Letter of Credit Fees. The Borrower shall pay to the Administrative
Agent for the account of each Lender in accordance with its Pro Rata Share, in
Dollars, letter of credit fees (the "Letter of Credit Fees") for each Letter of
Credit equal to the Applicable Rate times the Dollar Equivalent of the actual
daily maximum amount available to be drawn under such Letter of Credit (whether
or not such maximum amount is then in effect under such Letter of Credit). Such
letter of credit fees shall be computed on a quarterly basis in arrears. Such
letter of credit fees shall be due and payable on the first Business Day after
the end of each calendar quarter, commencing with the first such date to occur
after the issuance of such Letter of Credit, on the Letter of Credit Expiration
Date and thereafter on demand. If there is any change in the Applicable Rate
during any quarter, the daily maximum amount of each Letter of Credit shall be
computed and multiplied by the Applicable Rate separately for each period during
such quarter that such Applicable Rate was in effect.
(j) Fronting Fee and Documentary and Processing Charges Payable to L/C
Issuer. The Borrower shall pay directly to the L/C Issuer for its own account,
in Dollars, a fronting fee with respect to each Letter of Credit at a rate equal
to 0.125% per annum, payable on the Dollar Equivalent of the actual daily
maximum amount available to be drawn under such Letter of Credit (whether or not
such maximum amount is then in effect under such Letter of Credit).
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Such fronting fee shall be computed on a quarterly basis in arrears. Such
fronting fee shall be due and payable on the first Business Day after the end of
each calendar quarter, commencing with the first such date to occur after the
issuance of such Letter of Credit, on the Letter of Credit Expiration Date and
thereafter on demand. In addition, the Borrower shall pay directly to the L/C
Issuer for its own account the customary issuance, presentation, amendment and
other processing fees, and other standard costs and charges, of the L/C Issuer
relating to letters of credit as from time to time in effect, in Dollars or such
Alternative Currency as shall be separately agreed. Such customary fees and
standard costs and charges are due and payable on demand and are nonrefundable.
(k) Conflict with Issuer Documents. In the event of any conflict
between the terms hereof and the terms of any Issuer Documents, the terms hereof
shall control.
(l) Letters of Credit Issued for Subsidiaries. Notwithstanding that a
Letter of Credit issued or outstanding hereunder is in support of any
obligations of, or is for the account of, a Subsidiary, the Borrower shall be
obligated to reimburse the L/C Issuer hereunder for any and all drawings under
such Letter of Credit. The Borrower hereby acknowledges that the issuance of
Letters of Credit for the account of Subsidiaries inures to the benefit of the
Borrower, and that the Borrower's business derives substantial benefits from the
businesses of such Subsidiaries.
2.04 SWING LINE LOANS.
(a) The Swing Line. Subject to the terms and conditions set forth
herein, the Swing Line Lender agrees to make loans in Dollars (each such loan, a
"Swing Line Loan") to the Borrower from time to time on any Business Day during
the Availability Period in an aggregate amount not to exceed at any time
outstanding the amount of the Swing Line Sublimit, notwithstanding the fact that
such Swing Line Loans, when aggregated with the Pro Rata Share of the
Outstanding Amount of Committed Loans and L/C Obligations of the Lender acting
as Swing Line Lender, may exceed the amount of such Lender's Commitment;
provided, however, that after giving effect to any Swing Line Loan, (i) the
Total Outstandings shall not exceed the Aggregate Commitments, and (ii) the
aggregate Outstanding Amount of the Committed Loans of any Lender, plus such
Lender's Pro Rata Share of the Outstanding Amount of all L/C Obligations, plus
such Lender's Pro Rata Share of the Outstanding Amount of all Swing Line Loans
shall not exceed such Lender's Commitment, and provided, further, that the
Borrower shall not use the proceeds of any Swing Line Loan to refinance any
outstanding Swing Line Loan. Within the foregoing limits, and subject to the
other terms and conditions hereof, the Borrower may borrow under this Section
2.04, prepay under Section 2.05, and reborrow under this Section 2.04. Each
Swing Line Loan shall be a Base Rate Loan. Immediately upon the making of a
Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the Swing Line Lender a risk
participation in such Swing Line Loan in an amount equal to the product of such
Lender's Pro Rata Share times the amount of such Swing Line Loan.
(b) Borrowing Procedures. Each Swing Line Borrowing shall be made upon
the Borrower's irrevocable notice to the Swing Line Lender and the
Administrative Agent, which may be given by telephone. Each such notice must be
received by the Swing Line Lender and the Administrative Agent not later than
1:00 p.m. on the requested borrowing date, and shall specify
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(i) the amount to be borrowed, which shall be a minimum of $250,000, and (ii)
the requested borrowing date, which shall be a Business Day. Each such
telephonic notice must be confirmed promptly by delivery to the Swing Line
Lender and the Administrative Agent of a written Swing Line Loan Notice,
appropriately completed and signed by a Responsible Officer of the Borrower.
Promptly after receipt by the Swing Line Lender of any telephonic Swing Line
Loan Notice, the Swing Line Lender will confirm with the Administrative Agent
(by telephone or in writing) that the Administrative Agent has also received
such Swing Line Loan Notice and, if not, the Swing Line Lender will notify the
Administrative Agent (by telephone or in writing) of the contents thereof.
Unless the Swing Line Lender has received notice (by telephone or in writing)
from the Administrative Agent (including at the request of any Lender) prior to
2:00 p.m. on the date of the proposed Swing Line Borrowing (A) directing the
Swing Line Lender not to make such Swing Line Loan as a result of the
limitations set forth in the proviso to the first sentence of Section 2.04(a),
or (B) that one or more of the applicable conditions specified in Article IV is
not then satisfied, then, subject to the terms and conditions hereof, the Swing
Line Lender will, not later than 3:00 p.m. on the borrowing date specified in
such Swing Line Loan Notice, make the amount of its Swing Line Loan available to
the Borrower at its office by crediting the account of the Borrower on the books
of the Swing Line Lender in Same Day Funds.
(c) Refinancing of Swing Line Loans.
(i) The Swing Line Lender at any time in its sole and absolute
discretion may request, on behalf of the Borrower (which hereby irrevocably
authorizes the Swing Line Lender to so request on its behalf), that each Lender
make a Base Rate Committed Loan in an amount equal to such Lender's Pro Rata
Share of the amount of Swing Line Loans then outstanding. Such request shall be
made in writing (which written request shall be deemed to be a Committed Loan
Notice for purposes hereof) and in accordance with the requirements of Section
2.02, without regard to the minimum and multiples specified therein for the
principal amount of Base Rate Loans, but subject to the unutilized portion of
the Aggregate Commitments and the conditions set forth in Section 4.02. The
Swing Line Lender shall furnish the Borrower with a copy of the applicable
Committed Loan Notice promptly after delivering such notice to the
Administrative Agent. Each Lender shall make an amount equal to its Pro Rata
Share of the amount specified in such Committed Loan Notice available to the
Administrative Agent in Same Day Funds for the account of the Swing Line Lender
at the Administrative Agent's Office for Dollar-denominated payments not later
than 1:00 p.m. on the day specified in such Committed Loan Notice, whereupon,
subject to Section 2.04(c)(ii), each Lender that so makes funds available shall
be deemed to have made a Base Rate Committed Loan to the Borrower in such
amount. The Administrative Agent shall remit the funds so received to the Swing
Line Lender.
(ii) If for any reason any Swing Line Loan cannot be
refinanced by such a Committed Borrowing in accordance with Section 2.04(c)(i),
the request for Base Rate Committed Loans submitted by the Swing Line Lender as
set forth herein shall be deemed to be a request by the Swing Line Lender that
each of the Lenders fund its risk participation in the relevant Swing Line Loan
and each Lender's payment to the Administrative Agent for the account of the
Swing Line Lender pursuant to Section 2.04(c)(i) shall be deemed payment in
respect of such participation.
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(iii) If any Lender fails to make available to the
Administrative Agent for the account of the Swing Line Lender any amount
required to be paid by such Lender pursuant to the foregoing provisions of this
Section 2.04(c) by the time specified in Section 2.04(c)(i), the Swing Line
Lender shall be entitled to recover from such Lender (acting through the
Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment
is immediately available to the Swing Line Lender at a rate per annum equal to
the applicable Overnight Rate from time to time in effect. A certificate of the
Swing Line Lender submitted to any Lender (through the Administrative Agent)
with respect to any amounts owing under this clause (iii) shall be conclusive
absent manifest error.
(iv) Each Lender's obligation to make Committed Loans or to
purchase and fund risk participations in Swing Line Loans pursuant to this
Section 2.04(c) shall be absolute and unconditional and shall not be affected by
any circumstance, including (A) any set-off, counterclaim, recoupment, defense
or other right which such Lender may have against the Swing Line Lender, the
Borrower or any other Person for any reason whatsoever, (B) the occurrence or
continuance of a Default, or (C) any other occurrence, event or condition,
whether or not similar to any of the foregoing; provided, however, that each
Lender's obligation to make Committed Loans pursuant to this Section 2.04(c) is
subject to the conditions set forth in Section 4.02. No such funding of risk
participations shall relieve or otherwise impair the obligation of the Borrower
to repay Swing Line Loans, together with interest as provided herein.
(d) Repayment of Participations.
(i) At any time after any Lender has purchased and funded a
risk participation in a Swing Line Loan, if the Swing Line Lender receives any
payment on account of such Swing Line Loan, the Swing Line Lender will
distribute to such Lender its Pro Rata Share of such payment (appropriately
adjusted, in the case of interest payments, to reflect the period of time during
which such Lender's risk participation was funded) in the same funds as those
received by the Swing Line Lender.
(ii) If any payment received by the Swing Line Lender in
respect of principal or interest on any Swing Line Loan is required to be
returned by the Swing Line Lender under any of the circumstances described in
Section 10.06 (including pursuant to any settlement entered into by the Swing
Line Lender in its discretion), each Lender shall pay to the Swing Line Lender
its Pro Rata Share thereof on demand of the Administrative Agent, plus interest
thereon from the date of such demand to the date such amount is returned, at a
rate per annum equal to the applicable Overnight Rate. The Administrative Agent
will make such demand upon the request of the Swing Line Lender.
(e) Interest for Account of Swing Line Lender. The Swing Line Lender
shall be responsible for invoicing the Borrower for interest on the Swing Line
Loans. Until each Lender funds its Base Rate Committed Loan or risk
participation pursuant to this Section 2.04 to refinance such Lender's Pro Rata
Share of any Swing Line Loan, interest in respect of such Pro Rata Share shall
be solely for the account of the Swing Line Lender.
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(f) Payments Directly to Swing Line Lender. The Borrower shall make all
payments of principal and interest in respect of the Swing Line Loans directly
to the Swing Line Lender.
2.05 PREPAYMENTS.
(a) Voluntary Prepayments of Committed Loans. The Borrower may, upon
notice from the Borrower to the Administrative Agent, at any time or from time
to time voluntarily prepay Committed Loans in whole or in part without premium
or penalty; provided that (i) such notice must be received by the Administrative
Agent not later than 11:00 a.m. (A) three Business Days prior to any date of
prepayment of Eurocurrency Rate Loans denominated in Dollars, (B) four Business
Days (or five, in the case of prepayment of Loans denominated in Special Notice
Currencies) prior to any date of prepayment of Eurocurrency Rate Loans
denominated in Alternative Currencies, and (C) on the date of prepayment of Base
Rate Committed Loans; (ii) any prepayment of Eurocurrency Rate Loans shall be in
a principal amount of $1,000,000 or a whole multiple of $250,000 in excess
thereof; and (iii) any prepayment of Base Rate Committed Loans shall be in a
principal amount of $500,000 or a whole multiple of $100,000 in excess thereof
or, in each case, if less, the entire principal amount thereof then outstanding.
Each such notice shall specify the date and amount of such prepayment and the
Type(s) of Committed Loans to be prepaid and, if Eurocurrency Loans are to be
prepaid, the Interest Period(s) of such Loans. The Administrative Agent will
promptly notify each Lender of its receipt of each such notice, and of the
amount of such Lender's Pro Rata Share of such prepayment. If such notice is
given by the Borrower, the Borrower shall make such prepayment and the payment
amount specified in such notice shall be due and payable on the date specified
therein. Any prepayment of a Eurocurrency Rate Loan shall be accompanied by all
accrued interest on the amount prepaid, together with any additional amounts
required pursuant to Section 3.05. Each such prepayment shall be applied to the
Committed Loans of the Lenders in accordance with their respective Pro Rata
Shares. No optional prepayment of Committed Loans denominated in an Alternative
Currency may be made other than on the last day of the applicable Interest
Period for such Committed Loans, unless the Lenders consent thereto.
(b) Voluntary Prepayments of Swing Line Loans The Borrower may, upon
notice to the Swing Line Lender (with a copy to the Administrative Agent), at
any time or from time to time, voluntarily prepay Swing Line Loans in whole or
in part without premium or penalty; provided that (i) such notice must be
received by the Swing Line Lender and the Administrative Agent not later than
1:00 p.m. on the date of the prepayment, and (ii) any such prepayment shall be
in a minimum principal amount of $100,000. Each such notice shall specify the
date and amount of such prepayment. If such notice is given by the Borrower, the
Borrower shall make such prepayment and the payment amount specified in such
notice shall be due and payable on the date specified therein.
(c) Mandatory Prepayments of Committed Loans.
(i) Aggregate Commitment. If for any reason the Total
Outstandings at any time exceed the Aggregate Commitments then in effect, the
Borrower shall immediately prepay Loans and/or the Borrower shall Cash
Collateralize the L/C Obligations in an aggregate amount equal to such excess,
as the Borrower shall select; provided, however, that the Borrower shall not be
required to Cash Collateralize the L/C Obligations pursuant to this Section
2.05(c) unless after
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the prepayment in full of the Committed Loans and Swing Line Loans the Total
Outstandings exceed the Aggregate Commitments then in effect.
(ii) Alternative Currency Sublimit. If the Administrative
Agent notifies the Borrower at any time that the Outstanding Amount of all Loans
and L/C Obligations denominated in Alternative Currencies at such time exceeds
an amount equal to 105% of the Alternative Currency Sublimit then in effect,
then, within two Business Days after receipt of such notice, the Borrower shall
prepay Loans and/or the Borrower shall Cash Collateralize the L/C Obligations,
as the Borrower shall select, in an aggregate amount sufficient to reduce such
Outstanding Amount as of such date of payment to an amount not to exceed 100% of
the Alternative Currency Sublimit then in effect. The Administrative Agent may,
at any time and from time to time after the initial deposit of such Cash
Collateral, request that additional Cash Collateral be provided in order to
protect against the results of further exchange rate fluctuations.
(iii) Debt Proceeds. The Borrower shall make mandatory
principal prepayments of the Committed Loans in the manner set forth in Section
2.05(c)(vii) in amounts equal to one hundred percent (100%) of the aggregate Net
Cash Proceeds from any incurrence of Debt (excluding certain Debt permitted
pursuant to Section 7.02 by the Borrower or any of its Subsidiaries). Such
prepayment shall be made within three (3) Business Days after the date of
receipt of Net Cash Proceeds of any such transaction.
(iv) Equity Proceeds. The Borrower shall make mandatory
principal prepayments of the Committed Loans in the manner set forth in Section
2.05(c)(vii) in amounts equal to one hundred percent (100%) of the aggregate Net
Cash Proceeds from any offering of equity securities by the Borrower or any of
its Subsidiaries (other than issuances with respect to the exercise of stock
options and stock grants pursuant to the Borrower's stock incentive plans in
effect from time to time and issuances in connection with specifically
identified Permitted Acquisitions). Such prepayment shall be made within three
(3) Business Days after the date of receipt of Net Cash Proceeds of any such
transaction.
(v) Asset Sale Proceeds. No later than one hundred eighty
(180) days following the Borrower's receipt thereof, the Borrower shall make
mandatory principal prepayments of the Committed Loans in the manner set forth
in Section 2.05(c)(vii) in amounts equal to one hundred percent (100%) of the
aggregate Net Cash Proceeds from the Disposition or series of related
Dispositions of assets by the Borrower or any of its Subsidiaries (including
sales of stock of Subsidiaries) permitted pursuant to Section 7.06(b), (d), (f)
(g) and (h) (the "Disposition Proceeds"). Notwithstanding any of the foregoing
to the contrary, upon and during the continuance of an Event of Default and upon
notice from the Administrative Agent, all Disposition Proceeds, received by the
Borrower and its Subsidiaries shall be applied to make prepayments of the
Committed Loans, such prepayments to be made within three (3) Business Days
after the Borrower's receipt of such Disposition Proceeds.
(vi) Insurance and Condemnation Proceeds. No later than one
hundred eighty (180) days following the date of receipt by the Borrower or any
of its Subsidiaries of any Net Cash Proceeds under any of the insurance policies
maintained pursuant to Section 7.07 or from any condemnation proceeding (the
"Insurance and Condemnation Proceeds") which have not been reinvested as of such
date in similar replacement assets, the Borrower shall make
43
mandatory principal prepayments of the Committed Loans in the manner set forth
in Section 2.05(c)(vii) in amounts equal to one hundred percent (100%) of the
aggregate amount of such Insurance and Condemnation Proceeds received by the
Borrower or any of its Subsidiaries. Notwithstanding any of the foregoing to the
contrary, upon and during the continuance of an Event of Default and upon notice
from the Administrative Agent, all Insurance and Condemnation Proceeds, received
by the Borrower and its Subsidiaries shall be applied to make prepayments of the
Committed Loans, such prepayments to be made within three (3) Business Days
after the Borrower's receipt of such Insurance and Condemnation Proceeds.
(vii) Notice; Manner of Payment. Upon the occurrence of any
event triggering the prepayment requirement under Sections 2.05(c)(i) through
and including 2.05(c)(vi), the Borrower shall promptly give written notice to
the Administrative Agent and upon receipt of such notice, the Administrative
Agent shall promptly so notify the Lenders. Amounts prepaid under the Committed
Loans pursuant to this Section 2.05(c) may be reborrowed and will not constitute
a permanent reduction in the Aggregate Commitments. Each prepayment shall be
accompanied by any amount required to be paid pursuant to Section 3.06 hereof.
2.06 TERMINATION OR REDUCTION OF COMMITMENTS. The Borrower may, upon
notice to the Administrative Agent, terminate the Aggregate Commitments, or from
time to time permanently reduce the Aggregate Commitments; provided that (a) any
such notice shall be received by the Administrative Agent not later than 11:00
a.m. five Business Days prior to the date of termination or reduction, (b) any
such partial reduction shall be in an aggregate amount of $10,000,000 or any
whole multiple of $1,000,000 in excess thereof, (c) the Borrower shall not
terminate or reduce the Aggregate Commitments if, after giving effect thereto
and to any concurrent prepayments hereunder, the Total Outstandings would exceed
the Aggregate Commitments, and (d) if, after giving effect to any reduction of
the Aggregate Commitments, the Letter of Credit Sublimit, the Swing Line
Sublimit or the Alternative Currency Sublimit exceeds the amount of the
Aggregate Commitments, such Sublimit shall be automatically reduced by the
amount of such excess. The Administrative Agent will promptly notify the Lenders
of any such notice of termination or reduction of the Aggregate Commitments. Any
reduction of the Aggregate Commitments shall be applied to the Commitment of
each Lender according to its Pro Rata Share. All fees accrued until the
effective date of any termination of the Aggregate Commitments shall be paid on
the effective date of such termination.
2.07 REPAYMENT OF LOANS.
(a) The Borrower shall repay to the Lenders on the Maturity Date the
aggregate principal amount of Committed Loans outstanding on such date.
(b) The Borrower shall repay or refinance each Swing Line Loan on the
earlier to occur of (i) the date ten Business Days after such Loan is made and
(ii) the Maturity Date.
2.08 INTEREST.
(a) Subject to the provisions of subsection (b) below, (i) each
Eurocurrency Rate Loan shall bear interest on the outstanding principal amount
thereof for each Interest Period at a rate per annum equal to the Eurocurrency
Rate for such Interest Period plus the Applicable Rate
44
plus (in the case of a Eurocurrency Rate Loan of any Lender which is lent from a
Lending Office in the United Kingdom or a Participating Member State) the
Mandatory Cost; (ii) each Base Rate Committed Loan shall bear interest on the
outstanding principal amount thereof from the applicable borrowing date at a
rate per annum equal to the Base Rate plus the Applicable Rate; and (iii) each
Swing Line Loan shall bear interest on the outstanding principal amount thereof
from the applicable borrowing date at a rate per annum equal to the Base Rate
plus the Applicable Rate.
(b) If any amount payable by the Borrower under any Loan Document is
not paid when due (without regard to any applicable grace periods), whether at
stated maturity, by acceleration or otherwise, such amount shall thereafter bear
interest at a fluctuating interest rate per annum at all times equal to the
Default Rate to the fullest extent permitted by applicable Laws. Furthermore,
upon the request of the Required Lenders, while any Event of Default exists, the
Borrower shall pay interest on the principal amount of all outstanding
Obligations at a fluctuating interest rate per annum at all times equal to the
Default Rate to the fullest extent permitted by applicable Laws. Accrued and
unpaid interest on past due amounts (including interest on past due interest)
shall be due and payable upon demand.
(c) Interest on each Loan shall be due and payable in arrears on each
Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.
(d) For the purposes of the Interest Act (Canada), (i) whenever a rate
of interest or fee rate hereunder is calculated on the basis of a year (the
"deemed year") that contains fewer days than the actual number of days in the
calendar year of calculation, such rate of interest or fee rate shall be
expressed as a yearly rate by multiplying such rate of interest or fee rate by
the actual number of days in the calendar year of calculation and dividing it by
the number of days in the deemed year, (ii) the principle of deemed reinvestment
of interest shall not apply to any interest calculation hereunder and (iii) the
rates of interest stipulated herein are intended to be nominal rates and not
effective rates or yields.
2.09 FEES. In addition to certain fees described in subsections (i) and
(j) of Section 2.03:
(a) Commitment Fee. The Borrower shall pay to the Administrative Agent
for the account of each Lender in accordance with its Pro Rata Share, a
commitment fee (the "Commitment Fee") in Dollars equal to the Applicable Rate
times the actual daily amount by which the Aggregate Commitments exceed the sum
of (i) the Outstanding Amount of Committed Loans denominated in Dollars and (ii)
the Outstanding Amount of L/C Obligations denominated in Dollars. The commitment
fee shall accrue at all times during the Availability Period, including at any
time during which one or more of the conditions in Article IV is not met, and
shall be due and payable quarterly in arrears on the last Business Day of each
calendar quarter, commencing with the first such date to occur after the Closing
Date, and on the Maturity Date. The Commitment Fee shall be calculated quarterly
in arrears, and if there is any change in the Applicable Rate during any
quarter, the actual daily amount shall be computed and multiplied by
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the Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect. Notwithstanding the foregoing, the Applicable
Rate for determining the Commitment Fee will be 0.50% until the outstanding
amount of Committed Loans denominated in Dollars and L/C Obligations denominated
in Dollars exceeds $20,000,000 in the aggregate.
(b) Other Fees. (i) The Borrower shall pay to the Arranger and the
Administrative Agent for their own respective accounts, in Dollars, fees in the
amounts and at the times specified in the Fee Letter. Such fees shall be fully
earned when paid and shall not be refundable for any reason whatsoever.
(ii) The Borrower shall pay to the Lenders, in Dollars, such fees as
shall have been separately agreed upon in writing in the amounts and at the
times so specified. Such fees shall be fully earned when paid and shall not be
refundable for any reason whatsoever.
2.10 COMPUTATION OF INTEREST AND FEES. All computations of interest for
Base Rate Loans when the Base Rate is determined by Bank of America's "prime
rate" shall be made on the basis of a year of 365 or 366 days, as the case may
be, and actual days elapsed. All other computations of fees and interest shall
be made on the basis of a 360-day year and actual days elapsed (which results in
more fees or interest, as applicable, being paid than if computed on the basis
of a 365-day year), or, in the case of interest in respect of Committed Loans
denominated in Alternative Currencies as to which market practice differs from
the foregoing, in accordance with such market practice. Interest shall accrue on
each Loan for the day on which the Loan is made, and shall not accrue on a Loan,
or any portion thereof, for the day on which the Loan or such portion is paid,
provided that any Loan that is repaid on the same day on which it is made shall,
subject to Section 2.12(a), bear interest for one day.
2.11 EVIDENCE OF DEBT.
(a) The Credit Extensions made by each Lender shall be evidenced by one
or more accounts or records maintained by such Lender and by the Administrative
Agent in the ordinary course of business. The accounts or records maintained by
the Administrative Agent and each Lender shall be conclusive absent manifest
error of the amount of the Credit Extensions made by the Lenders to the Borrower
and the interest and payments thereon. Any failure to so record or any error in
doing so shall not, however, limit or otherwise affect the obligation of the
Borrower hereunder to pay any amount owing with respect to the Obligations. In
the event of any conflict between the accounts and records maintained by any
Lender and the accounts and records of the Administrative Agent in respect of
such matters, the accounts and records of the Administrative Agent shall control
in the absence of manifest error. Upon the request of any Lender made through
the Administrative Agent, the Borrower shall execute and deliver to such Lender
(through the Administrative Agent) a Note, which shall evidence such Lender's
Loans in addition to such accounts or records. Each Lender may attach schedules
to its Note and endorse thereon the date, Type (if applicable), amount, currency
and maturity of its Loans and payments with respect thereto.
(b) In addition to the accounts and records referred to in subsection
(a), each Lender and the Administrative Agent shall maintain in accordance with
its usual practice accounts or records evidencing the purchases and sales by
such Lender of participations in Letters of Credit
46
and Swing Line Loans. In the event of any conflict between the accounts and
records maintained by the Administrative Agent and the accounts and records of
any Lender in respect of such matters, the accounts and records of the
Administrative Agent shall control in the absence of manifest error.
2.12 PAYMENTS GENERALLY.
(a) All payments to be made by the Borrower shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff.
Except as otherwise expressly provided herein and except with respect to
principal of and interest on Loans denominated in an Alternative Currency, all
payments by the Borrower hereunder shall be made to the Administrative Agent,
for the account of the respective Lenders to which such payment is owed, at the
applicable Administrative Agent's Office in Dollars and in Same Day Funds not
later than 2:00 p.m. on the date specified herein. Except as otherwise expressly
provided herein, all payments by the Borrower hereunder with respect to
principal and interest on Loans denominated in an Alternative Currency shall be
made to the Administrative Agent, for the account of the respective Lenders to
which such payment is owed, at the applicable Administrative Agent's Office in
such Alternative Currency and in Same Day Funds not later than the Applicable
Time specified by the Administrative Agent on the dates specified herein.
Without limiting the generality of the foregoing, the Administrative Agent may
require that any payments due under this Agreement be made in the United States.
If, for any reason, the Borrower is prohibited by any Law from making any
required payment hereunder in an Alternative Currency, the Borrower shall make
such payment in Dollars in the Dollar Equivalent of the Alternative Currency
payment amount. The Administrative Agent will promptly distribute to each Lender
its Pro Rata Share (or other applicable share as provided herein) of such
payment in like funds as received by wire transfer to such Lender's Lending
Office. All payments received by the Administrative Agent (i) after 2:00 p.m.,
in the case of payments in Dollars, or (ii) after the Applicable Time specified
by the Administrative Agent in the case of payments in an Alternative Currency,
shall in each case be deemed received on the next succeeding Business Day and
any applicable interest or fee shall continue to accrue.
(b) If any payment to be made by the Borrower shall come due on a day
other than a Business Day, payment shall be made on the next following Business
Day, and such extension of time shall be reflected in computing interest or
fees, as the case may be.
(c) Unless the Borrower or any Lender has notified the Administrative
Agent, prior to the date any payment is required to be made by it to the
Administrative Agent hereunder, that the Borrower or such Lender, as the case
may be, will not make such payment, the Administrative Agent may assume that the
Borrower or such Lender, as the case may be, has timely made such payment and
may (but shall not be so required to), in reliance thereon, make available a
corresponding amount to the Person entitled thereto. If and to the extent that
such payment was not in fact made to the Administrative Agent in Same Day Funds,
then:
(i) if the Borrower failed to make such payment, each Lender
shall forthwith on demand repay to the Administrative Agent the portion of such
assumed payment that was made available to such Lender in Same Day Funds,
together with interest thereon in respect of each day from and including the
date such amount was made available by the Administrative
47
Agent to such Lender to the date such amount is repaid to the Administrative
Agent in Same Day Funds at the applicable Overnight Rate from time to time in
effect; and
(ii) if any Lender failed to make such payment, such Lender
shall forthwith on demand pay to the Administrative Agent the amount thereof in
Same Day Funds, together with interest thereon for the period from the date such
amount was made available by the Administrative Agent to a Borrower to the date
such amount is recovered by the Administrative Agent (the "Compensation Period")
at a rate per annum equal to the applicable Overnight Rate from time to time in
effect. If such Lender pays such amount to the Administrative Agent, then such
amount shall constitute such Lender's Committed Loan included in the applicable
Borrowing. If such Lender does not pay such amount forthwith upon the
Administrative Agent's demand therefor, the Administrative Agent may make a
demand therefor upon the Borrower, and the Borrower shall pay such amount to the
Administrative Agent, together with interest thereon for the Compensation Period
at a rate per annum equal to the rate of interest applicable to the applicable
Borrowing. Nothing herein shall be deemed to relieve any Lender from its
obligation to fulfill its Commitment or to prejudice any rights which the
Administrative Agent or the Borrower may have against any Lender as a result of
any default by such Lender hereunder.
A notice of the Administrative Agent to any Lender or the Borrower with
respect to any amount owing under this subsection (c) shall be conclusive,
absent manifest error.
(d) If any Lender makes available to the Administrative Agent funds for
any Loan to be made by such Lender as provided in the foregoing provisions of
this Article II, and such funds are not made available to the Borrower by the
Administrative Agent because the conditions to the applicable Credit Extension
set forth in Article IV are not satisfied or waived in accordance with the terms
hereof, the Administrative Agent shall return such funds (in like funds as
received from such Lender) to such Lender, without interest.
(e) The obligations of the Lenders hereunder to make Committed Loans
and to fund participations in Letters of Credit and Swing Line Loans are several
and not joint. The failure of any Lender to make any Committed Loan or to fund
any such participation on any date required hereunder shall not relieve any
other Lender of its corresponding obligation to do so on such date, and no
Lender shall be responsible for the failure of any other Lender to so make its
Committed Loan or purchase its participation.
(f) Nothing herein shall be deemed to obligate any Lender to obtain the
funds for any Loan in any particular place or manner or to constitute a
representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.
2.13 SHARING OF PAYMENTS. If, other than as expressly provided
elsewhere herein, any Lender shall obtain on account of the Committed Loans made
by it, or the participations in L/C Obligations or in Swing Line Loans held by
it, any payment (whether voluntary, involuntary, through the exercise of any
right of set-off, or otherwise) in excess of its ratable share (or other share
contemplated hereunder) thereof, such Lender shall immediately (a) notify the
Administrative Agent of such fact, and (b) purchase from the other Lenders such
participations in the Committed Loans made by them and/or such subparticipations
in the participations in L/C Obligations or Swing Line Loans held by them, as
the case may be, as shall be necessary to
48
cause such purchasing Lender to share the excess payment in respect of such
Committed Loans or such participations, as the case may be, pro rata with each
of them; provided, however, that if all or any portion of such excess payment is
thereafter recovered from the purchasing Lender under any of the circumstances
described in Section 10.06 (including pursuant to any settlement entered into by
the purchasing Lender in its discretion), such purchase shall to that extent be
rescinded and each other Lender shall repay to the purchasing Lender the
purchase price paid therefor, together with an amount equal to such paying
Lender's ratable share (according to the proportion of (i) the amount of such
paying Lender's required repayment to (ii) the total amount so recovered from
the purchasing Lender) of any interest or other amount paid or payable by the
purchasing Lender in respect of the total amount so recovered, without further
interest thereon. The Borrower agrees that any Lender so purchasing a
participation from another Lender may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off, but subject
to Section 10.09) with respect to such participation as fully as if such Lender
were the direct creditor of the Borrower in the amount of such participation.
The Administrative Agent will keep records (which shall be conclusive and
binding in the absence of manifest error) of participations purchased under this
Section and will in each case notify the Lenders following any such purchases or
repayments. Each Lender that purchases a participation pursuant to this Section
shall from and after such purchase have the right to give all notices, requests,
demands, directions and other communications under this Agreement with respect
to the portion of the Obligations purchased to the same extent as though the
purchasing Lender were the original owner of the Obligations purchased.
2.14 SECURITY. The Obligations shall be secured as provided in the
Security Documents.
ARTICLE III.
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 TAXES.
(a) Any and all payments by the Borrower to or for the account of the
Administrative Agent or any Lender under any Loan Document shall be made free
and clear of and without deduction for any and all present or future taxes,
duties, levies, imposts, deductions, assessments, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the case of the
Administrative Agent and each Lender, taxes imposed on or measured by its
overall net income, and franchise taxes imposed on it (in lieu of net income
taxes), by the jurisdiction (or any political subdivision thereof) under the
Laws of which the Administrative Agent or such Lender, as the case may be, is
organized or maintains a lending office (all such non-excluded taxes, duties,
levies, imposts, deductions, assessments, fees, withholdings or similar charges,
and liabilities being hereinafter referred to as "Taxes"). If the Borrower shall
be required by any Laws to deduct any Taxes from or in respect of any sum
payable under any Loan Document to the Administrative Agent or any Lender, (i)
the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section), each of the Administrative Agent and such Lender receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) the
49
Borrower shall make such deductions, (iii) the Borrower shall pay the full
amount deducted to the relevant taxation authority or other authority in
accordance with applicable Laws, and (iv) within 30 days after the date of such
payment, the Borrower shall furnish to the Administrative Agent (which shall
forward the same to such Lender) the original or a certified copy of a receipt
evidencing payment thereof.
(b) In addition, the Borrower agrees to pay any and all present or
future stamp, court or documentary taxes and any other excise or property taxes
or charges or similar levies which arise from any payment made by the Borrower
under any Loan Document or from the execution, delivery, performance,
enforcement or registration of, or otherwise with respect to, any Loan Document
(hereinafter referred to as "Other Taxes").
(c) If the Borrower shall be required to deduct or pay any Taxes or
Other Taxes from or in respect of any sum payable under any Loan Document to the
Administrative Agent or any Lender, the Borrower shall also pay to the
Administrative Agent or to such Lender, as the case may be, at the time interest
is paid, such additional amount that the Administrative Agent or such Lender
specifies is necessary to preserve the after-tax yield (after factoring in all
taxes, including taxes imposed on or measured by net income) that the
Administrative Agent or such Lender would have received if such Taxes or Other
Taxes had not been imposed.
(d) The Borrower agrees to indemnify the Administrative Agent and each
Lender for (i) the full amount of Taxes and Other Taxes (including any Taxes or
Other Taxes imposed or asserted by any jurisdiction on amounts payable under
this Section) paid by the Administrative Agent and such Lender, (ii) amounts
payable under Section 3.01(c) and (iii) any liability (including additions to
tax, penalties, interest and expenses) arising therefrom or with respect
thereto, in each case whether or not such Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. Payment
under this subsection (d) shall be made within 30 days after the date the Lender
or the Administrative Agent makes a demand therefor accompanied with appropriate
supporting documentation.
(e) Without limiting the obligations of the Lenders under Section 10.15
regarding delivery of certain forms and documents to establish each Lender's
status for U.S. withholding tax purposes, each Lender agrees promptly to deliver
to the Administrative Agent or the Borrower, as the Administrative Agent or the
Borrower shall reasonably request, on or prior to the Closing Date, and in a
timely fashion thereafter, such other documents and forms required by any
relevant taxing authorities under the Laws of any other jurisdiction, duly
executed and completed by such Lender, as are required under such Laws to
confirm such Lender's entitlement to any available exemption from, or reduction
of, applicable withholding taxes in respect of all payments to be made to such
Lender outside of the U.S. by the Borrower pursuant to this Agreement or
otherwise to establish such Lender's status for withholding tax purposes in such
other jurisdiction. Each Lender shall promptly (i) notify the Administrative
Agent of any change in circumstances which would modify or render invalid any
such claimed exemption or reduction, and (ii) take such steps as shall not be
materially disadvantageous to it, in the reasonable judgment of such Lender, and
as may be reasonably necessary (including the re-designation of its Lending
Office) to avoid any requirement of applicable Laws of any such jurisdiction
that the Borrower make any deduction or withholding for taxes from amounts
payable to such Lender. Additionally, the Borrower shall promptly deliver to the
Administrative
50
Agent or any Lender, as the Administrative Agent or such Lender shall reasonably
request, on or prior to the Closing Date, and in a timely fashion thereafter,
such documents and forms required by any relevant taxing authorities under the
Laws of any jurisdiction, duly executed and completed by the Borrower, as are
required to be furnished by such Lender or the Administrative Agent under such
Laws in connection with any payment by the Administrative Agent or any Lender of
Taxes or Other Taxes, or otherwise in connection with the Loan Documents, with
respect to such jurisdiction.
3.02 ILLEGALITY. If any Lender reasonably determines that any Law has
made it unlawful, or that any Governmental Authority has asserted that it is
unlawful, for any Lender or its applicable Lending Office to make, maintain or
fund Eurocurrency Rate Loans (whether denominated in Dollars or an Alternative
Currency), or to determine or charge interest rates based upon the Eurocurrency
Rate, or any Governmental Authority has imposed material restrictions on the
authority of such Lender to purchase or sell, or to take deposits of, Dollars or
any Alternative Currency in the applicable interbank market, then, on notice
thereof by such Lender to the Borrower through the Administrative Agent, any
obligation of such Lender to make or continue Eurocurrency Rate Loans in the
affected currency or currencies or, in the case of Eurocurrency Rate Loans in
Dollars, to convert Base Rate Committed Loans to Eurocurrency Rate Loans, shall
be suspended until such Lender notifies the Administrative Agent and the
Borrower that the circumstances giving rise to such determination no longer
exist. Upon receipt of such notice, the Borrower shall, upon demand from such
Lender (with a copy to the Administrative Agent), prepay or, if applicable and
such Loans are denominated in Dollars, convert all such Eurocurrency Rate Loans
of such Lender to Base Rate Loans, either on the last day of the Interest Period
therefor, if such Lender may lawfully continue to maintain such Eurocurrency
Rate Loans to such day, or immediately, if such Lender may not lawfully continue
to maintain such Eurocurrency Rate Loans. Upon any such prepayment or
conversion, the Borrower shall also pay accrued interest on the amount so
prepaid or converted. Each Lender agrees to designate a different Lending Office
if such designation will avoid the need for such notice and will not, in the
good faith judgment of such Lender, otherwise be materially disadvantageous to
such Lender.
3.03 INABILITY TO DETERMINE RATES. If the Required Lenders reasonably
determine that for any reason in connection with any request for a Eurocurrency
Rate Loan or a conversion to or continuation thereof that (i) deposits (whether
in Dollars or an Alternative Currency) are not being offered to banks in the
applicable offshore interbank market for such currency for the applicable amount
and Interest Period of such Eurocurrency Rate Loan, (ii) adequate and reasonable
means do not exist for determining the Eurocurrency Base Rate for any requested
Interest Period with respect to a proposed Eurocurrency Rate Loan (whether
denominated in Dollars or an Alternative Currency), or (iii) the Eurocurrency
Base Rate for any requested Interest Period with respect to a proposed
Eurocurrency Rate Loan does not adequately and fairly reflect the cost to such
Lenders of funding such Eurocurrency Rate Loan, the Administrative Agent will
promptly so notify the Borrower and each Lender. Thereafter, the obligation of
the Lenders to make or maintain Eurocurrency Rate Loans in the affected currency
or currencies shall be suspended until the Administrative Agent (upon the
instruction of the Required Lenders) revokes such notice. Upon receipt of such
notice, the Borrower may revoke any pending request for a Borrowing of,
conversion to or continuation of Eurocurrency Rate Loans in the affected
51
currency or currencies or, failing that, will be deemed to have converted such
request into a request for a Committed Borrowing of Base Rate Loans in the
amount specified therein.
3.04 INCREASED COST AND REDUCED RETURN; CAPITAL ADEQUACY; RESERVES ON
EUROCURRENCY RATE LOANS.
(a) If any Lender reasonably determines that as a result of the
introduction of or any change in or in the interpretation of any Law, or such
Lender's compliance therewith, there shall be any increase in the cost to such
Lender of agreeing to make or making, funding or maintaining Eurocurrency Rate
Loans or (as the case may be) issuing or participating in Letters of Credit, or
a reduction in the amount received or receivable by such Lender in connection
with any of the foregoing (excluding for purposes of this subsection (a) any
such increased costs or reduction in amount resulting from (i) Taxes or Other
Taxes (as to which Section 3.01 shall govern), (ii) changes in the basis of
taxation of overall net income or overall gross income by the United States or
any foreign jurisdiction or any political subdivision of either thereof under
the Laws of which such Lender is organized or has its Lending Office, (iii)
reserve requirements contemplated by Section 3.04(c) or utilized in the
determination of the Eurocurrency Rate and (iv) the requirements of the Bank of
England and the Financial Services Authority or the European Central Bank
reflected in the Mandatory Cost, other than as set forth below) or the Mandatory
Cost, as calculated hereunder, does not represent the cost to such Lender of
complying with the requirements of the Bank of England and/or the Financial
Services Authority or the European Central Bank in relation to its making,
funding or maintaining of Eurocurrency Rate Loans, then from time to time upon
demand of such Lender (with a copy of such demand to the Administrative Agent),
the Borrower shall pay to such Lender such additional amounts as will compensate
such Lender for such increased cost or reduction or, if applicable, the portion
of such cost that is not represented by the Mandatory Cost.
(b) If any Lender reasonably determines that the introduction of any
Law regarding capital adequacy or any change therein or in the interpretation
thereof, or compliance by such Lender (or its Lending Office) therewith, has the
effect of reducing the rate of return on the capital of such Lender or any
corporation controlling such Lender as a consequence of such Lender's
obligations hereunder (taking into consideration its policies with respect to
capital adequacy and such Lender's desired return on capital), then from time to
time upon demand of such Lender (with a copy of such demand to the
Administrative Agent), the Borrower shall pay to such Lender such additional
amounts as will compensate such Lender for such reduction.
(c) The Borrower shall pay to each Lender, as long as such Lender shall
be required to comply with any reserve ratio requirement or analogous
requirement of any central banking or financial regulatory authority imposed in
respect of the maintenance of the Commitments or the funding of the Eurocurrency
Rate Loans, such additional costs (expressed as a percentage per annum and
rounded upwards, if necessary, to the nearest five decimal places) equal to the
actual costs allocated to such Commitment or Loan by such Lender (as determined
by such Lender in good faith, which determination shall be conclusive), which
shall be due and payable on each date on which interest is payable on such Loan,
provided the Borrower shall have received at least 15 days' prior notice (with a
copy to the Administrative Agent) of such additional costs from such Lender. If
a Lender fails to give notice 15 days prior to the relevant Interest Payment
Date, such additional costs shall be due and payable 15 days from receipt of
such notice.
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3.05 COMPENSATION FOR LOSSES. Upon demand of any Lender (with a copy to
the Administrative Agent) from time to time, the Borrower shall promptly
compensate such Lender for and hold such Lender harmless from any loss, cost or
expense incurred by it as a result of:
(a) any continuation, conversion, payment or prepayment of any Loan
other than a Base Rate Loan on a day other than the last day of the Interest
Period for such Loan (whether voluntary, mandatory, automatic, by reason of
acceleration, or otherwise);
(b) any failure by the Borrower (for a reason other than the failure of
such Lender to make a Loan) to prepay, borrow, continue or convert any Loan
other than a Base Rate Loan on the date or in the amount notified by the
Borrower;
(c) any failure by the Borrower to make payment of any Loan or drawing
under any Letter of Credit (or interest due thereon) denominated in an
Alternative Currency on its scheduled due date or any payment thereof in a
different currency; or
(d) any assignment of a Eurocurrency Rate Loan on a day other than the
last day of the Interest Period therefor as a result of a request by the
Borrower pursuant to Section 10.16;
including any loss of anticipated profits, any foreign exchange losses and any
loss or expense arising from the liquidation or reemployment of funds obtained
by it to maintain such Loan, from fees payable to terminate the deposits from
which such funds were obtained or from the performance of any foreign exchange
contract. The Borrower shall also pay any customary administrative fees charged
by such Lender in connection with the foregoing.
For purposes of calculating amounts payable by the Borrower to the Lenders under
this Section 3.05, each Lender shall be deemed to have funded each Eurocurrency
Rate Loan made by it at the Eurocurrency Base Rate used in determining the
Eurocurrency Rate for such Loan by a matching deposit or other borrowing in the
offshore interbank market for such currency for a comparable amount and for a
comparable period, whether or not such Eurocurrency Rate Loan was in fact so
funded.
3.06 MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION.
(a) A certificate of the Administrative Agent or any Lender claiming
compensation under this Article III and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, the Administrative Agent or such
Lender may use any reasonable averaging and attribution methods.
(b) Upon any Lender's making a claim for compensation under Section
3.01 or 3.04, the Borrower may replace such Lender in accordance with Section
10.16.
3.07 SURVIVAL. All of the Borrower's obligations under this Article III
shall survive termination of the Aggregate Commitments and repayment of all
other Obligations hereunder.
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ARTICLE IV.
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS
4.01 CONDITIONS OF INITIAL CREDIT EXTENSION. The obligation of each
Lender to make its initial Credit Extension hereunder is subject to satisfaction
of the following conditions precedent:
(a) Loan Documents, Certificates and Opinions. The Administrative
Agent's receipt of the following, each of which shall be originals or facsimiles
(followed promptly by originals) unless otherwise specified, each properly
executed by a Responsible Officer of the signing Loan Party, each dated the
Closing Date (or, in the case of certificates of governmental officials, a
recent date before the Closing Date) and each in form and substance satisfactory
to the Administrative Agent and its legal counsel:
(i) executed counterparts of this Agreement, the Collateral
Agreement, the Subsidiary Guaranty Agreement and any other applicable Loan
Documents, sufficient in number for distribution to the Administrative Agent,
each Lender and the Borrower;
(ii) a Note executed by the Borrower in favor of each Lender
requesting a Note;
(iii) such certificates of resolutions or other action,
incumbency certificates and/or other certificates of Responsible Officers of
each Loan Party as the Administrative Agent may require evidencing the identity,
authority and capacity of each Responsible Officer thereof authorized to act as
a Responsible Officer in connection with this Agreement and the other Loan
Documents to which such Loan Party is a party;
(iv) such documents and certifications as the Administrative
Agent may reasonably require to evidence that each Loan Party is duly organized
or formed, and that each Loan Party is validly existing, in good standing under
the laws of its jurisdiction of organization and, to the extent requested by the
Administrative Agent, each other jurisdiction where each Loan Party is qualified
to do business and a certificate, if available, of the relevant taxing
authorities of such jurisdictions certifying that such Loan Party has filed
required tax returns and owes no delinquent taxes; provided that, with respect
to items noted herein, such Loan Party shall not be required to deliver the
documents noted therein if such Loan Party certifies that the articles or
certificate of incorporation or formation of such Loan Party and all amendments
thereto and the bylaws or other governing document of such Loan Party and all
amendments thereto which were delivered to the Administrative Agent in
connection with the Existing Credit Agreement have not been repealed, revoked,
rescinded or further amended in any respect and that each remains in full force
and effect as of the Closing Date;
(v) a favorable opinion of Kane Kessler, P.C., counsel to the
Loan Parties, addressed to the Administrative Agent and each Lender,
substantially in the form of Exhibit G;
(vi) a certificate of a Responsible Officer of each Loan Party
either (A) attaching copies of all consents, licenses and approvals required in
connection with the execution, delivery and performance by such Loan Party and
the validity against such Loan Party of the Loan Documents to which it is a
party, and such consents, licenses and approvals shall be
54
in full force and effect, or (B) stating that no such consents, licenses or
approvals are so required and no action has been taken by any Person that could
reasonably be expected restrain, prevent or impose any material adverse
conditions on any of the Loan Parties or such other transactions or that could
seek or threaten any of the foregoing, and no law or regulation shall be
applicable which in the reasonable judgment of the Administrative Agent could
reasonably be expected to have such effect;
(vii) a certificate signed by a Responsible Officer of the
Borrower certifying (A) that the conditions specified in Sections 4.02(a) and
(b) have been satisfied, (B) that there has been no event or circumstance since
December 31, 2002 that has had or could be reasonably expected to have, either
individually or in the aggregate, a Material Adverse Effect, and (C) that no
actions, suits, investigations or proceedings are pending or threatened in any
court or before any arbitrator or Governmental Authority that purport (1) to
materially and adversely affect the Loan Parties or (2) to affect any
transaction contemplated by this Agreement or the ability of the Loan Parties or
any other obligor under the Loan Documents to perform their respective
obligations under the Loan Documents; and
(viii) such other assurances, certificates, documents,
consents or opinions as the Administrative Agent, the L/C Issuer, the Swing Line
Lender or the Required Lenders reasonably may require.
(b) Collateral.
(i) Filings and Recordings. All filings and recordations that
are necessary to perfect the security interests of the Lenders in the collateral
described in the Security Documents shall have been forwarded for filing in all
appropriate locations and the Administrative Agent shall have received evidence
satisfactory to the Administrative Agent that upon such filings and recordations
such security interests constitute valid and perfected first priority Liens
therein except for Permitted Liens.
(ii) Pledged Collateral. The Administrative Agent shall have
received (A) original stock certificates or other certificates evidencing the
Capital Stock pledged pursuant to the Security Documents, together with an
undated stock power for each such certificate duly executed in blank by the
registered owner thereof and (B) each original promissory note pledged pursuant
to the Security Documents.
(iii) Lien Search. The Administrative Agent shall have
received the results of a Lien search (including a search as to judgments,
pending litigation and tax matters) made against the Loan Parties under the UCC
(or applicable judicial docket) as in effect in any state in which any of its
assets are located, indicating among other things that its assets are free and
clear of any Lien except for Liens permitted hereunder.
(iv) Hazard and Liability Insurance. The Administrative Agent
shall have received certificates of insurance, evidence of payment of all
insurance premiums for the current policy year of each, and, if requested by the
Administrative Agent, copies (certified by a Responsible Officer) of insurance
policies in the form required under the Security Documents and otherwise in form
and substance reasonably satisfactory to the Administrative Agent.
55
(c) Financial Matters.
(i) Financial Statements. The Administrative Agent and the
Lenders shall have received (A) the audited consolidated balance sheet of the
Borrower and its Subsidiaries and the related consolidated statements of income
or operations, shareholders' equity and cash flows for the Fiscal Years ended
December 31, 2000, December 31, 2001 and December 31, 2002, (B) the pro forma
financial statements of the Borrower and its Subsidiaries after giving effect to
the High Yield Bond Issuance and the other transactions contemplated by this
Agreement and (C) such other financial information as the Administrative Agent
may reasonably request, all in form and substance satisfactory to the
Administrative Agent and the Lenders and prepared in accordance with GAAP.
(ii) Financial Condition Certificate. The Borrower shall have
delivered to the Administrative Agent a certificate, in form and substance
satisfactory to the Administrative Agent, and certified as accurate by a
Responsible Officer, that (A) after giving effect to the transactions
contemplated by the High Yield Bond Issuance and the other transactions
contemplated by this Agreement, the Borrower and each of its Subsidiaries, taken
as a whole, are each Solvent, (B) the Borrower's payables are current and not
past due, (C) attached thereto are calculations evidencing compliance on a pro
forma basis and after giving effect to the High Yield Bond Issuance and the
other transactions contemplated by this Agreement, with the covenants contained
in Section 7.01 and (D) the pro forma financial statements delivered pursuant to
Section 4.01(c)(i) and the financial projections previously delivered to the
Administrative Agent represent the good faith estimates (utilizing reasonable
assumptions) of the financial condition and operations of the Borrower and its
Subsidiaries.
(iii) Fees. The Borrower shall have paid (A) all fees and
expenses required to be paid on or before the Closing Date and (B) all Attorney
Costs of the Administrative Agent to the extent invoiced prior to or on the
Closing Date, plus such additional amounts of Attorney Costs as shall constitute
its reasonable estimate of Attorney Costs incurred or to be incurred by it
through the closing proceedings (provided that such estimate shall not
thereafter preclude a final settling of accounts between the Borrower and the
Administrative Agent).
(iv) Other Financial Information. The Administrative Agent
shall have received any updates or modifications to the financial information
previously provided thereto by the Borrower, as reasonably requested by the
Administrative Agent.
(d) Existing Indebtedness. All existing Indebtedness for borrowed money
of the Borrower and its Subsidiaries (other than the Indebtedness permitted
pursuant to Section 7.02) shall have been repaid in full with the proceeds of
the initial Loans hereunder and terminated, and Indebtedness under the Existing
Credit Agreement (other than the Existing Letters of Credit) shall have been
repaid in full and such credit agreement shall have been terminated and any
Liens granted thereunder or pursuant thereto shall have been released or
arrangements satisfactory to the Agents shall have been made with respect
thereto.
(e) Other Documents. All opinions, certificates and other instruments
and all proceedings in connection with the transactions contemplated by this
Agreement shall be satisfactory in form and substance to the Administrative
Agent. The Administrative Agent shall
56
have received (i) copies of information regarding litigation, tax, accounting,
labor, insurance, pension liabilities (actual or contingent), real estate
leases, material contracts, debt agreements, property ownership, environmental
maters, contingent liabilities and management of the Borrower and its
subsidiaries and (ii) all other documents, certificates and instruments
reasonably requested thereby, with respect to the transactions contemplated by
this Agreement.
(f) High Yield Bonds.
(i) High Yield Bond Issuance. The Borrower shall have
received, on or prior to the Closing Date, net cash proceeds from the issuance
of the High Yield Bonds in an aggregate amount equal to at least $125,000,000
(collectively, the "High Yield Bond Issuance").
(ii) No Injunction, Etc. No action, proceeding, investigation,
regulation or legislation shall have been instituted, threatened or proposed
before any Governmental Authority to enjoin, restrain, or prohibit, or to obtain
substantial damages in respect of, or which is related to or arises out of the
High Yield Bond Documents or the consummation of the transactions contemplated
thereby, or which, in the Administrative Agent's reasonable discretion, would
make it inadvisable to consummate the transactions contemplated by this
Agreement and the other Loan Documents.
(iii) Other Documents. The Administrative Agent shall have
received any High Yield Bond Documents requested thereby, and each High Yield
Bond Document shall be in form and substance reasonably satisfactory to the
Administrative Agent.
4.02 CONDITIONS TO ALL CREDIT EXTENSIONS. The obligation of each Lender
to honor any Request for Credit Extension is subject to the following conditions
precedent:
(a) The representations and warranties of the Borrower and each other
Loan Party contained in Article V or any other Loan Document, or which are
contained in any document furnished at any time under or in connection herewith
or therewith, shall be true and correct on and as of the date of such Credit
Extension, except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they shall be true and
correct as of such earlier date, and except that for purposes of this Section
4.02, the representations and warranties contained in subsections (a) and (b) of
Section 5.01 shall be deemed to refer to the most recent statements furnished
pursuant to clauses (a) and (b), respectively, of Section 6.01.
(b) No Default or Event of Default shall exist, or would result from
such proposed Credit Extension.
(c) The Administrative Agent and, if applicable, the L/C Issuer or the
Swing Line Lender shall have received a Request for Credit Extension in
accordance with the requirements hereof.
(d) The Administrative Agent shall have received each additional
document, instrument, legal opinion or other item reasonably requested by it.
(e) In the case of a Credit Extension to be denominated in an
Alternative Currency, there shall not have occurred any change in national or
international financial, political or
57
economic conditions or currency exchange rates or exchange controls which in the
reasonable opinion of the Administrative Agent, the Required Lenders (in the
case of any Loans to be denominated in an Alternative Currency) or the L/C
Issuer (in the case of any Letter of Credit to be denominated in an Alternative
Currency) would make it impracticable for such Credit Extension to be
denominated in the relevant Alternative Currency.
Each Request for Credit Extension submitted by the Borrower shall be
deemed to be a representation and warranty that the conditions specified in
Sections 4.02(a) and (b) have been satisfied on and as of the date of the
applicable Credit Extension.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Administrative Agent and
the Lenders that:
5.01 FINANCIAL CONDITION.
(a) The consolidated balance sheet of the Borrower and its consolidated
Subsidiaries as at December 31, 2002 and the related consolidated statements of
income and of cash flows for the Fiscal Year ended on such date, audited by
PricewaterhouseCoopers LLP, copies of which have heretofore been furnished to
each Lender, are complete and correct in all material respects and present
fairly the consolidated financial condition of the Borrower and its consolidated
Subsidiaries as at such date, and the consolidated results of their operations
and their consolidated cash flows for the Fiscal Year then ended. The unaudited
consolidated balance sheet of the Borrower and its consolidated Subsidiaries as
at March 31, 2003 and the related unaudited consolidated statements of income
and of cash flows for the three-month period ended on such date, certified by a
Responsible Officer, copies of which have heretofore been furnished to each
Lender, are complete and correct in all material respects and present fairly the
consolidated financial condition of the Borrower and its consolidated
Subsidiaries as at such date, and the consolidated results of their operations
and their consolidated cash flows for the three-month period then ended (subject
to normal year-end audit adjustments and the absence of footnotes). All such
financial statements, including the related schedules and notes thereto, have
been prepared in accordance with GAAP applied consistently throughout the
periods involved (except as approved by such accountants or Responsible Officer,
as the case may be, and as disclosed therein). Except as set forth on Schedule
5.01, neither the Borrower nor any of its consolidated Subsidiaries had, at the
date of the most recent balance sheet referred to above, any material Guarantee
Obligation, contingent liability or liability for taxes, or any long-term lease
or unusual forward or long-term commitment, including, without limitation, any
interest rate or foreign currency swap or exchange transaction or other
financial derivative, which is not reflected in the foregoing statements or in
the notes thereto. Except as set forth in Schedule 5.01, during the period from
December 31, 2002 to and including the date hereof there has been no sale,
transfer or other disposition by the Borrower or any of its consolidated
Subsidiaries of any material part of its business or property, other than sales
in the ordinary course of business, permitted sales of inventory and sales of
obsolete or worn out goods or equipment and no purchase or other acquisition of
any business or property (including any Capital Stock of any
58
other Person) material in relation to the consolidated financial condition of
the Borrower and its consolidated Subsidiaries at December 31, 2002.
(b) The operating forecast of the Borrower and its consolidated
Subsidiaries, copies of which have heretofore been furnished to the Lenders,
have been prepared in good faith under the direction of a Responsible Officer of
the Borrower, and in accordance with GAAP except that such forecast and
projections do not include footnotes and other disclosures which may be required
pursuant to GAAP. The Borrower has no reason to believe that as of the date of
delivery such operating forecast was materially incorrect or misleading in any
material respect, or omitted to state any material fact which would render them
misleading in any material respect. The parties hereto acknowledge that all such
forecasts and projections are based on various facts and assumptions which the
Borrower believes are reasonable, but there can be no assurance that such facts
or assumptions will materialize as anticipated, and the actual results may vary
materially from such forecasts and projections.
5.02 NO CHANGE. Except as set forth in Schedule 5.02, (a) since
December 31, 2002 there has been no development or event which has had or could
reasonably be expected to have a Material Adverse Effect, and (b) during the
period from December 31, 2002 to and including the date of this Agreement no
dividends or other distributions have been declared, paid or made upon the
Capital Stock of the Borrower nor has any of the Capital Stock of the Borrower
been redeemed, retired, purchased or otherwise acquired for value by the
Borrower or any of its Subsidiaries.
5.03 EXISTENCE; COMPLIANCE WITH LAW. Except as set forth in Schedule
5.03, each of the Borrower and its Subsidiaries (a) is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization, (b) has the requisite power and authority, and the legal right, to
own and operate its property, to lease the property it operates as lessee and to
conduct the business in which it is currently engaged, (c) is duly qualified as
a foreign corporation and in good standing under the laws of each jurisdiction
where its ownership, lease or operation of property or the conduct of its
business requires such qualification and (d) is in compliance with all
applicable Law, except to the extent that, in each such case, the failure to
comply therewith could not reasonably be expected to, in the aggregate, have a
Material Adverse Effect.
5.04 POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS. Each of the
Borrower and its Subsidiaries has the corporate power and authority, and the
legal right, to execute, deliver and perform the Loan Documents to which it is a
party and to borrow hereunder and has taken all necessary corporate action to
authorize the borrowings on the terms and conditions of this Agreement and any
Notes and to authorize the execution, delivery and performance of the Loan
Documents to which it is a party. Except as set forth in Schedule 5.04, no
consent or authorization of, filing with, notice to or other act by or in
respect of, any Governmental Authority or any other Person is required in
connection with the borrowings hereunder or with the execution, delivery,
performance, validity or enforceability of the Loan Documents to which the
Borrower or any of its Subsidiaries is a party. This Agreement has been, and
each other Loan Document to which it is a party will be, duly executed and
delivered on behalf of the Borrower and its Subsidiaries. This Agreement
constitutes, and each other Loan Document to which it is a party when executed
and delivered will constitute, a legal, valid and binding obligation of the
59
Borrower and its Subsidiaries, as the case may be, enforceable against the
Borrower and its Subsidiaries, as the case may be, in accordance with its
respective terms, subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable principles (whether
considered in a proceeding in equity or at law) and an implied covenant of good
faith and fair dealing.
5.05 NO LEGAL BAR. The execution, delivery and performance of the Loan
Documents to which the Borrower and its Subsidiaries are a party, the borrowings
hereunder and the use of the proceeds thereof will not violate any applicable
Law or Contractual Obligation of the Borrower or of any of its Subsidiaries and
will not result in, or require, the creation or imposition of any Lien on any of
its or their respective properties or revenues pursuant to any such applicable
Law or Contractual Obligation (other than Liens created by the Security
Documents in favor of the Administrative Agent).
5.06 NO MATERIAL LITIGATION. Except as set forth on Schedule 5.06, no
litigation, investigation or proceeding of or before any arbitrator or
Governmental Authority is pending or, to the knowledge of the Borrower,
threatened by or against the Borrower or any of its Subsidiaries or against any
of its or their respective properties or revenues (a) with respect to any of
the Loan Documents or any of the transactions contemplated hereby or thereby, or
(b) which could reasonably be expected to have a Material Adverse Effect.
5.07 NO DEFAULT. Neither the Borrower nor any of its Subsidiaries is in
default under or with respect to any of its Contractual Obligations in any
respect which could reasonably be expected to have a Material Adverse Effect. No
Default or Event of Default has occurred and is continuing or would result from
the consummation of the transactions contemplated by this Agreement or any other
Loan Document.
5.08 OWNERSHIP OF PROPERTY; LIENS. Each of the Borrower and its
Subsidiaries has good record and marketable title in fee simple to, or a valid
leasehold interest in, all its real property, and good title to, or a valid
leasehold interest in, all its other property, and none of such property is
subject to any Lien except as permitted by Section 7.03.
5.09 INTELLECTUAL PROPERTY. The Borrower and each of its Subsidiaries
owns, or is licensed to use, all trademarks, tradenames, copyrights, technology,
know-how and processes necessary for the conduct of its business as currently
conducted except for those the failure to own or license which could not have a
Material Adverse Effect (the "Intellectual Property"). Except as set forth on
Schedule 5.09, no claim has been asserted and is pending by any Person
challenging or questioning the use of any such Intellectual Property or the
validity or effectiveness of any such Intellectual Property, nor does the
Borrower know of any valid basis for any such claim. The use of such
Intellectual Property by the Borrower and its Subsidiaries does not to the
knowledge of the Borrower infringe on the rights of any Person, except for such
claims and infringements that, in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.
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5.10 NO BURDENSOME RESTRICTIONS. No applicable Law or Contractual
Obligation of the Borrower or any of its Subsidiaries could reasonably be
expected to have a Material Adverse Effect.
5.11 TAXES. Each of the Borrower and its Subsidiaries has filed or
caused to be filed all tax returns which, to the knowledge of the Borrower, are
required to be filed and has paid all taxes shown to be due and payable on said
returns or on any assessments made against it or any of its property and all
other taxes, fees or other charges imposed on it or any of its property by any
Governmental Authority (other than any the amount or validity of which are
currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on the
books of the Borrower or its Subsidiaries, as the case may be, except where the
failure to file such return or pay such tax or other fee or charge could not
reasonably be expected to have a Material Adverse Effect); no tax Lien has been
filed, and, to the knowledge of the Borrower, no claim is being asserted, with
respect to any such tax, fee or other charge.
5.12 FEDERAL REGULATIONS. No part of the proceeds of any Loans will be
used for "purchasing" or "carrying" any "margin stock" within the respective
meanings of each of the quoted terms under Regulation U of the Board of
Governors of the Federal Reserve System as now and from time to time hereafter
in effect, or for any purpose which violates, or which would be inconsistent
with, the provisions of the regulations of such Board of Governors. 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 G-3 or FR Form U-1 referred to in
said Regulation U, as the case may be.
5.13 ERISA. Neither an ERISA Event nor an "accumulated funding
deficiency" (within the meaning of Section 412 of the Code or Section 302 of
ERISA) has occurred during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Plan, and each Plan
has complied in all material respects with the applicable provisions of ERISA
and the Code relating to the foregoing. No termination of a Pension Plan has
occurred, and no Lien in favor of the PBGC or a Plan has arisen, during such
five-year period. The present value of all accrued benefits under each Pension
Plan (based on those assumptions used to fund such Plans) did not, as of the
last annual valuation date prior to the date on which this representation is
made or deemed made, exceed the value of the assets of such Plan allocable to
such accrued benefits. Neither the Borrower nor any ERISA Affiliate has had a
complete or partial withdrawal from any Multiemployer Plan, and neither the
Borrower nor any ERISA Affiliate would become subject to any liability under
ERISA if the Borrower or any such ERISA Affiliate were to withdraw completely
from all Multiemployer Plans as of the valuation date most closely preceding the
date on which this representation is made or deemed made. The present value
(determined using actuarial and other assumptions which are reasonable in
respect of the benefits provided and the employees participating) of the
liability of the Borrower and each ERISA Affiliate for post retirement benefits
to be provided to their current and former employees under Plans which are
welfare benefit plans (as defined in Section 3(1) of ERISA) does not, in the
aggregate, exceed the assets under all such Plans allocable to such benefits by
an amount in excess of (a) at any time prior to the consummation of the Simula
Acquisition, $500,000 or (b) on and after the consummation of the Simula
Acquisition, $4,000,000.
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5.14 INVESTMENT COMPANY ACT; OTHER REGULATIONS. The Borrower is not an
"investment company", or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended. The
Borrower is not subject to regulation under any Federal or State statute or
regulation (other than Regulation X of the Board of Governors of the Federal
Reserve System) which limits its ability to incur Indebtedness.
5.15 SUBSIDIARIES. Schedule 5.15 sets forth the name of each direct or
indirect Subsidiary of the Borrower, its form of organization, its jurisdiction
of organization, the total number of issued and outstanding shares or other
interests of Capital Stock thereof, the classes and number of issued and
outstanding shares or other interests of Capital Stock of each such class, the
name of each holder of Capital Stock thereof and the number of shares or other
interests of such Capital Stock held by each such holder and the percentage of
all outstanding shares or other interests of such class of Capital Stock held by
such holders. All outstanding shares or other interest of Capital Stock of the
Borrower or its Subsidiaries have been duly authorized and validly issued and
are fully paid and nonassessable, with no personal liability attaching to the
ownership thereof, and not subject to any preemptive or similar rights. As of
the Closing Date, there are no outstanding stock purchase warrants,
subscriptions, options, securities, instruments or other rights of any type or
nature whatsoever, which are convertible into, exchangeable for or otherwise
provide for or permit the issuance of Capital Stock of the Borrower or its
Subsidiaries, except as described on Schedule 5.15.
5.16 SECURITY DOCUMENTS.
(a) The provisions of each Security Document are effective to create in
favor of the Administrative Agent for the ratable benefit of the Lenders a
legal, valid and enforceable security interest in all right, title and interest
of the Loan Party thereto in the "Collateral" described therein.
(b) When certificates representing the Investment Property and
Partnership/LLC Interests (as defined in the Collateral Agreement) are delivered
to the Administrative Agent, together with stock powers endorsed in blank by a
duly authorized officer of the pledgors thereof, the Collateral Agreement shall
constitute a fully perfected first Lien on, and security interest in, all right,
title and interest of the pledgors parties thereto in the "Collateral" described
therein, assuming continued and uninterrupted possession by the Administrative
Agent of such Investment Property and Partnership/LLC Interests, subject to
Permitted Liens.
5.17 ACCURACY AND COMPLETENESS OF INFORMATION.
(a) All factual information, reports and other papers and data with
respect to the Loan Parties (other than projections) furnished, and all factual
statements and representations made, to the Administrative Agent or the Lenders
by a Loan Party, or on behalf of a Loan Party, were, at the time the same were
so furnished or made, when taken together with all such other factual
information, reports and other papers and data previously so furnished and all
such other factual statements and representations previously so made, complete
and correct in all material respects, to the extent necessary to give the
Administrative Agent and the Lenders true and accurate knowledge of the subject
matter thereof in all material respects, and did not, as of the date so
furnished or made, contain any untrue statement of a material fact or omit to
state any material
62
fact necessary in order to make the statements contained therein not misleading
in light of the circumstances in which the same were made.
(b) All forecasts with respect to the Loan Parties furnished by or on
behalf of a Loan Party to the Administrative Agent or the Lenders were prepared
and presented in good faith by or on behalf of such Loan Party. The parties
hereto acknowledge that all such forecasts are based on various facts and
assumptions which the Borrower believes are reasonable, but there can be no
assurance that such facts or assumptions will materialize as anticipated, and
the actual results may vary materially from such forecasts. No fact is known to
a Loan Party which materially and adversely affects or in the future is
reasonably likely (so far as such Loan Party can reasonably foresee) to have a
Material Adverse Effect which has not been set forth in the financial statements
referred to in Section 7.1 or in such information, reports, papers and data or
otherwise disclosed in writing to the Administrative Agent or the Lenders prior
to the Closing Date.
5.18 LABOR RELATIONS. No Loan Party is engaged in any unfair labor
practice which could reasonably be expected to have a Material Adverse Effect.
There is (a) no unfair labor practice complaint pending or, to the best
knowledge of each Loan Party and each of the Subsidiaries, threatened against a
Loan Party before the National Labor Relations Board which could reasonably be
expected to have a Material Adverse Effect and no grievance or arbitration
proceeding arising out of or under a collective bargaining agreement is so
pending or threatened; (b) no strike, labor dispute, slowdown or stoppage
pending or, to the best knowledge of each Loan Party, threatened against a Loan
Party; and (c) no petition for union representation has been filed with respect
to the employees of a Loan Party and, to the best of the Borrower's knowledge,
no union organizing activities are taking place with respect to any thereof.
5.19 INSURANCE. Each Loan Party has, with respect to its properties and
business, insurance covering the risks, in the amounts, with the deductible or
other retention amounts, and with the carriers, listed on Schedule 5.19, which
insurance meets the requirements of Section 6.05 hereof as of the date hereof
and the Closing Date.
5.20 SOLVENCY. On the Closing Date, after giving effect to the
incurrence of all Indebtedness and obligations being incurred on or prior to
such date in connection herewith, (i) the amount of the "present fair saleable
value" of the assets of the Borrower and of the Borrower and its Subsidiaries,
taken as a whole, will, as of such date, exceed the amount of all "liabilities
of the Borrower and of the Borrower and its Subsidiaries, taken as a whole,
contingent or otherwise", as of such date, as such quoted terms are determined
in accordance with applicable federal and state laws governing determinations of
the insolvency of debtors, (ii) the present fair saleable value of the assets of
the Borrower and of the Borrower and its Subsidiaries, taken as a whole, will,
as of such date, be greater than the amount that will be required to pay the
liabilities of the Borrower and of the Borrower and its Subsidiaries, taken as a
whole, on their respective debts as such debts become absolute and matured,
(iii) neither the Borrower nor the Borrower and its Subsidiaries, taken as a
whole, will have, as of such date, an unreasonably small amount of capital with
which to conduct their respective businesses, and (iv) each of the Borrower and
the Borrower and its Subsidiaries, taken as a whole, will be able to pay their
respective debts as they mature. For purposes of this Section 5.20, "debt" means
"liability on a claim", "claim" means any (x) right to payment, whether or not
such a right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable,
63
secured or unsecured, and (y) right to an equitable remedy for breach of
performance if such breach gives rise to a right to payment, whether or not such
right to an equitable remedy is reduced to judgment, fixed, contingent, matured
or unmatured, disputed, undisputed, secured or unsecured.
5.21 PURPOSE OF LOANS. The proceeds of the Credit Extensions shall be
used by the Borrower (a) for working capital, capital expenditures, and other
lawful corporate purposes, (b) to finance future Permitted Acquisitions, (c) to
refinance existing Indebtedness, including, without limitation, Indebtedness
outstanding under the Existing Credit Agreement, and (d) to pay for transaction
costs in connection with this Agreement and the High Yield Bonds.
5.22 ENVIRONMENTAL MATTERS.
Except as set forth on Schedule 5.22:
(a) The facilities and properties owned, leased or operated by the
Borrower or any of its Subsidiaries (the "Properties") do not contain, and have
not previously contained, any Hazardous Materials in amounts or concentrations
which (i) constitute or constituted a violation of, or (ii) could give rise to
liability under, any Environmental Law except in either case insofar as such
violation or liability, or any aggregation thereof, is not reasonably likely to
result in the payment of a Material Environmental Amount.
(b) The Properties and all operations at the Properties are in
compliance, and have in the last three years been in compliance, in all material
respects with all applicable Environmental Laws, and there is no contamination
at, under or about the Properties or violation of any Environmental Law with
respect to the Properties or the business operated by the Borrower or any of its
Subsidiaries (the "Business") which could materially interfere with the
continued operation of the Properties or materially impair the fair saleable
value thereof.
(c) Neither the Borrower nor any of its Subsidiaries has received any
notice of violation, alleged violation, non-compliance, liability or potential
liability regarding environmental matters or compliance with Environmental Laws
with regard to any of the Properties or the Business, nor does the Borrower have
knowledge or reason to believe that any such notice will be received or is being
threatened except insofar as such notice or threatened notice, or any
aggregation thereof, does not involve a matter or matters that is or are
reasonably likely to result in the payment of a Material Environmental Amount.
(d) Hazardous Materials have not been transported or disposed of from
the Properties in violation of, or in a manner or to a location which could give
rise to liability under, any Environmental Law, nor have any Hazardous Materials
been generated, treated, stored or disposed of at, on or under any of the
Properties in violation of, or in a manner that could give rise to liability
under, any applicable Environmental Law except insofar as any such violation or
liability referred to in this paragraph, or any aggregation thereof, is not
reasonably likely to result in the payment of a Material Environmental Amount.
(e) No judicial proceeding or governmental or administrative action is
pending or, to the knowledge of the Borrower, threatened, under any
Environmental Law to which the Borrower or any Subsidiary is or will be named as
a party with respect to the Properties or the
64
Business, nor are there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or judicial
requirements outstanding under any Environmental Law with respect to the
Properties or the Business except insofar as such proceeding, action, decree,
order or other requirement, or any aggregation thereof, is not reasonably likely
to result in the payment of a Material Environmental Amount.
(f) There has been no release or threat of release of Hazardous
Materials at or from the Properties, or arising from or related to the
operations of the Borrower or any Subsidiary in connection with the Properties
or otherwise in connection with the Business, in violation of or in amounts or
in a manner that could give rise to liability under Environmental Laws except
insofar as any such violation or liability referred to in this paragraph, or any
aggregation thereof, is not reasonably likely to result in the payment of a
Material Environmental Amount.
5.23 REGULATION H. None of the real property of the Borrower or any of
its Subsidiaries is located in an area that has been identified by the Secretary
of Housing and Urban Development as an area having special flood hazards and in
which flood insurance has been made available under the National Flood Insurance
Act of 1968.
5.24 TAX SHELTER REGULATIONS. The Borrower does not intend to treat the
Loans and/or Letters of Credit as being a "reportable transaction" (within the
meaning of Treasury Regulation Section 1.6011-4). In the event the Borrower
determines to take any action inconsistent with such intention, it will promptly
notify the Administrative Agent thereof. If the Borrower so notifies the
Administrative Agent, the Borrower acknowledges that one or more of the Lenders
may treat its Committed Loans and/or its interest in Swing Line Loans and/or
Letters of Credit as part of a transaction that is subject to Treasury
Regulation Section 301.6112-1, and such Lender or Lenders, as applicable, will
maintain the lists and other records required by such Treasury Regulation.
5.25 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties set forth in this Article V and all representations and
warranties contained in any certificate, or any of the Loan Documents
(including, but not limited to, any such representation or warranty made in or
in connection with any amendment thereto) shall constitute representations and
warranties made under this Agreement. All representations and warranties made
under this Agreement shall be made or deemed to be made at and as of the Closing
Date (except those that are expressly made as of a specific date), shall survive
the Closing Date and shall not be waived by the execution and delivery of this
Agreement, any investigation made by or on behalf of the Lenders or any
borrowing hereunder.
ARTICLE VI.
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding, the Borrower shall, and shall cause each
Subsidiary to:
6.01 FINANCIAL STATEMENTS.
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Furnish to each Lender:
(a) as soon as available, but in any event within 90 days (or, if
earlier, the date by which the Borrower shall be required to file its annual
report on Form 10-K) after the end of each Fiscal Year of the Borrower, a copy
of the consolidated balance sheet of the Borrower and its consolidated
Subsidiaries as at the end of such year and the related consolidated statements
of income and retained earnings and of cash flows for such year, setting forth
in each case in comparative form the figures for the previous year, reported on
without a "going concern" or like qualification or exception, or qualification
arising out of the scope of the audit, by PricewaterhouseCoopers LLP or other
independent certified public accountants of nationally recognized standing; and
(b) as soon as available, but in any event not later than 45 days (or,
if earlier, the date by which the Borrower shall be required to file its
quarterly report on Form 10-Q) after the end of each of the first three
quarterly periods of each Fiscal Year of the Borrower, the unaudited
consolidated balance sheet of the Borrower and its consolidated Subsidiaries as
at the end of such quarter and the related unaudited consolidated statements of
income and retained earnings and of cash flows of the Borrower and its
consolidated Subsidiaries for such quarter and the portion of the Fiscal Year
through the end of such quarter, setting forth in each case in comparative form
the figures for the previous year, certified by a Responsible Officer as being
fairly stated in all material respects (subject to normal year-end audit
adjustments, provided that, so long as the common stock of the Borrower is
registered pursuant to the Securities Exchange Act of 1934, as amended,
quarterly financial statements in compliance with the requirements of quarterly
report on Form 10-Q shall be deemed to satisfy the requirements of this Section
6.01(b));
(c) all such financial statements shall be complete and correct in all
material respects and shall be prepared in reasonable detail and in accordance
with GAAP applied consistently throughout the periods reflected therein and with
prior periods (except as approved by such accountants or officer, as the case
may be, and disclosed therein and with respect to unaudited financial
statements, as to the absence of footnotes and as to ordinary year-end audit
adjustments).
6.02 CERTIFICATES; OTHER INFORMATION.
Furnish to each Lender:
(a) concurrently with the delivery of the financial statements referred
to in Section 6.01(a), a certificate of the independent certified public
accountants reporting on such financial statements stating that in making the
examination necessary therefor no knowledge was obtained of any Default or Event
of Default, except as specified in such certificate;
(b) within five (5) Business Days following the delivery of the
financial statements referred to in Sections 6.01(a) and (b), a Compliance
Certificate of a Responsible Officer (i) stating that, to the best of such
Officer's knowledge, the Borrower during such period has observed or performed
all of its material covenants and other agreements, and satisfied every material
condition, contained in this Agreement and the other Loan Documents to be
observed,
66
performed or satisfied by it, and that such Officer has obtained no knowledge of
any Default or Event of Default except as specified in such certificate and (ii)
showing in reasonable detail the calculations supporting such Officer's
certification of the Borrower's compliance with the requirements of Section
7.01;
(c) not later than February 15 of each Fiscal Year of the Borrower, a
copy of the projections by the Borrower of the operating budget of the Borrower
and its Subsidiaries for such Fiscal Year, such projections to be accompanied by
a certificate of a Responsible Officer to the effect that such projections have
been prepared on the basis of sound financial planning practice and that such
Officer has no reason to believe they are incorrect or misleading in any
material respect. The parties hereto acknowledge that all such projections are
based on various facts and assumptions which the Borrower believes are
reasonable, but there can be no assurance that such facts or assumptions will
materialize as anticipated, and the actual results may vary materially from such
projections;
(d) within five days after the same are sent, copies of all financial
statements and reports which the Borrower sends to its stockholders, and within
five days after the same are filed, copies of all financial statements and
reports which the Borrower may make to, or file with, the Securities and
Exchange Commission or any successor or analogous Governmental Authority;
(e) during the month of January in each calendar year, a report of a
reputable insurance broker with respect to the insurance maintained by the
Borrower and its Subsidiaries in accordance with Section 6.05 and such
supplemental reports as the Administrative Agent may from time to time
reasonably request;
(f) promptly after the Borrower has notified the Administrative Agent
of any intention by the Borrower to treat the Loans and/or Letters of Credit as
being a "reportable transaction" (within the meaning of Treasury Regulation
Section 1.6011-4), a duly completed copy of IRS Form 8886 or any successor form;
and
(g) promptly, such additional financial and other information as any
Lender may from time to time reasonably request.
6.03 PAYMENT OF OBLIGATIONS. Pay, discharge or otherwise satisfy at or
before maturity or before they become delinquent, as the case may be, all its
obligations of whatever nature, except where the amount or validity thereof is
currently being contested in good faith by appropriate proceedings and reserves
in conformity with GAAP with respect thereto have been provided on the books of
the Borrower or its Subsidiaries, as the case may be.
6.04 CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE. Continue to
engage in business of the same general type as now conducted by it and preserve,
renew and keep in full force and effect its corporate existence and take all
reasonable action to maintain all rights, privileges and franchises necessary or
desirable in the normal conduct of its business except as otherwise permitted
pursuant to Section 7.05; comply with all Contractual Obligations and applicable
Law except to the extent that failure to comply therewith could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.
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6.05 MAINTENANCE OF PROPERTY; INSURANCE. Keep all property useful and
necessary in its business in good working order and condition, reasonable wear
and tear excepted; maintain with financially sound and reputable insurance
companies insurance on all its property in at least such amounts and against at
least such risks (but including in any event public liability, product liability
and business interruption) as are usually insured against in the same general
area by companies engaged in the same or a similar business, which insurance
shall name the Administrative Agent as lender loss payee, in the case of
property or casualty insurance, and as an additional insured, in the case of
liability insurance; and furnish to each Lender, upon written request, full
information as to the insurance carried.
6.06 INSPECTION OF PROPERTY; BOOKS AND RECORDS; DISCUSSIONS. Keep
proper books of records and account in which full, true and correct entries in
conformity with GAAP and all applicable Law shall be made of all dealings and
transactions in relation to its business and activities; and permit
representatives of any Lender to visit and inspect, upon reasonable notice, any
of its properties and examine and make abstracts from any of its books and
records at any reasonable time and as often as may reasonably be desired and to
discuss the business, operations, properties and financial and other condition
of the Borrower and its Subsidiaries with officers and employees of the Borrower
and its Subsidiaries and with its independent certified public accountants.
6.07 NOTICES.
Promptly give notice to the Administrative Agent and each Lender of:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any Contractual
Obligation of the Borrower or any of its Subsidiaries or (ii) litigation,
investigation or proceeding which may exist at any time between the Borrower or
any of its Subsidiaries and any Governmental Authority, which in either case, if
not cured or if adversely determined, as the case may be, could have a Material
Adverse Effect;
(c) any litigation or proceeding affecting the Borrower or any of its
Subsidiaries in which the amount involved is $1,000,000 or more and not covered
by insurance or in which injunctive or similar relief is sought;
(d) the acquisition by any Loan Party of any interest in any Subsidiary
(or any Person which is anticipated to become a Subsidiary) that is not subject
to a perfected Lien in favor of the Administrative Agent pursuant to the
Security Documents;
(e) the occurrence of any transaction or occurrence referred to in
Sections 2.05(c)(iii) through (vi) and the receipt of any Net Cash Proceeds or
any insurance proceeds as a result thereof (whether or not such Net Cash
Proceeds or proceeds are then required to be applied to the prepayment of Loans
as specified in Section 2.05;
(f) the following events, as soon as possible and in any event within
30 days after the Borrower knows or has reason to know thereof: (i) the
occurrence or expected occurrence of any ERISA Event with respect to any Plan, a
failure to make any required contribution to a Plan, the
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creation of any Lien in favor of the PBGC or a Plan or any withdrawal from, or
the termination, Reorganization or Insolvency of, any Multiemployer Plan or (ii)
the institution of proceedings or the taking of any other action by the PBGC or
the Borrower or any ERISA Affiliate or any Multiemployer Plan with respect to
the withdrawal from, or the terminating of, any Plan; and
(g) any development or event which has had or could reasonably be
expected to have a Material Adverse Effect.
Each notice pursuant to this Section shall be accompanied by a
statement of a Responsible Officer setting forth details of the occurrence
referred to therein and stating what action the Borrower proposes to take with
respect thereto.
6.08 ENVIRONMENTAL LAWS.
(a) Comply with, and ensure compliance by all tenants and subtenants,
if any, with, all applicable Environmental Laws and obtain and comply in all
material respects with and maintain, and ensure that all tenants and subtenants
obtain and comply in all material respects with and maintain, any and all
licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws except to the extent that failure to do so could
not be reasonably expected to have a Material Adverse Effect.
(b) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities regarding Environmental
Laws except to the extent that the same are being contested in good faith by
appropriate proceedings and the pendency of such proceedings could not be
reasonably expected to have a Material Adverse Effect.
6.09 ADDITIONAL SUBSIDIARIES. Notify the Administrative Agent promptly
after any Person becomes a Subsidiary of the Borrower, and promptly thereafter
(and in any event within 30 days), cause such Person to (a) become a guarantor
under the Subsidiary Guaranty Agreement and a grantor under the Collateral
Agreement by executing and delivering to the Administrative Agent a duly
executed Joinder Agreement (unless a Responsible Officer shall have certified to
the Administrative Agent and the Lenders that the execution of a Joinder
Agreement by a Foreign Subsidiary would materially and adversely affect the tax
position of such Foreign Subsidiary and of the Borrower), (b) deliver to the
Administrative Agent documents of the types referred to in clauses (iii) and
(iv) of Section 4.01(a) and, if requested by the Administrative Agent, favorable
opinions of counsel to such Person (which shall cover, among other things, the
legality, validity, binding effect and enforceability of the documentation
referred to in clause (a)), (c) deliver to the Administrative Agent such other
documents and closing certificates as may be reasonably requested by the
Administrative Agent, all in form, content and scope reasonably satisfactory to
the Administrative Agent and (d) deliver to the Administrative Agent an updated
Schedule 5.15 and updated schedules to the Collateral Agreement reflecting the
creation or acquisition of such Subsidiary. The Borrower and such Subsidiary
shall comply with the terms of each of the Security Documents.
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ARTICLE VII.
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding, the Borrower shall not, nor shall it permit any
Subsidiary to, directly or indirectly:
7.01 FINANCIAL COVENANTS.
(a) Consolidated EBITDA to Consolidated Fixed Charges. Permit the ratio
of (i) the sum of (A) Consolidated EBITDA for any Rolling Period ended during
the term of this Agreement minus (B) Consolidated Capital Expenditures made
during such period minus (C) cash taxes paid during such period, to (ii)
Consolidated Fixed Charges for such period to be less than 1.5 to 1.0.
(b) Consolidated Total Indebtedness to EBITDA. Permit, for any Rolling
Period ended during the term of this Agreement, the ratio of (i) the
Consolidated Total Indebtedness as of the last day of such period to (ii)
Consolidated EBITDA for such period to be greater than (A) for the period from
the Closing Date until the earlier of the closing of the Simula Acquisition and
December 31, 2003, 4.0 to 1.0 and (B) thereafter, 3.5 to 1.0.
(c) Consolidated Senior Indebtedness to EBITDA. Permit, for any Rolling
Period ended during the term of this Agreement, the ratio of (i) Consolidated
Senior Indebtedness as of the last day of such period to (ii) to Consolidated
EBITDA for such period to be greater than 2.0 to 1.0.
(d) Maintenance of Net Worth. Permit, as of the end of any Fiscal
Quarter during the term of this Agreement, Consolidated Net Worth at the end of
such period to be less than the sum of $244,000,000 plus (i) 75% of the positive
aggregate Consolidated Net Income for each Fiscal Quarter during the period
beginning with the Fiscal Quarter ending on or about September 30, 2003, and
ending as of the end of the Fiscal Quarter for which Consolidated Net Worth is
being measured, and (ii) 100% of the Net Cash Proceeds of all sales or issuances
of equity securities of the Borrower or any Subsidiary, whether in a public
offering, a private placement or otherwise, other than amounts received upon
exercise of stock options issued pursuant to a stock option plan permitted under
this Agreement, completed during such period.
7.02 LIMITATION ON INDEBTEDNESS.
Create, incur, assume or suffer to exist any Indebtedness, except:
(a) Indebtedness of the Borrower under this Agreement;
(b) Indebtedness of the Borrower to any Guarantor and of any Guarantor
to the Borrower or any other Guarantor;
(c) Indebtedness of the Borrower and any of its Subsidiaries incurred
to finance the acquisition of fixed or Capital Assets (whether pursuant to a
loan, a Capital Lease or otherwise)
70
in an aggregate principal amount not exceeding as to the Borrower and its
Subsidiaries $10,000,000 at any time outstanding;
(d) short-term Indebtedness of Foreign Subsidiaries owed to third
Persons other than the Borrower and its Subsidiaries incurred for working
capital purposes in an aggregate principal amount, together with the aggregate
amount of all investments made pursuant to Section 7.11(h), not exceeding as to
such Foreign Subsidiaries $15,000,000, at any time outstanding;
(e) Indebtedness outstanding on the date hereof and listed on Schedule
7.02 and any refinancings, refundings, renewals or extensions thereof; provided
that the amount of such Indebtedness is not increased at the time of such
refinancing, refunding, renewal or extension except by an amount equal to a
reasonable premium or other reasonable amount paid, and fees and expenses
reasonably incurred, in connection with such refinancing and by an amount equal
to any existing commitments unutilized thereunder;
(f) Indebtedness of a corporation which becomes a Subsidiary after the
date hereof, provided that (i) such Indebtedness existed at the time such
corporation became a Subsidiary and was not created in anticipation thereof and
(ii) immediately after giving effect to the acquisition of such corporation by
the Borrower no Default or Event of Default shall have occurred and be
continuing;
(g) additional unsecured Indebtedness of the Borrower not exceeding
$2,500,000 in aggregate principal amount at any one time outstanding;
(h) other Indebtedness of the Borrower or any Subsidiary incurred with
the prior written consent of the Administrative Agent and subordinated to the
Indebtedness on terms satisfactory to the Administrative Agent hereunder in its
sole discretion, and which shall not exceed $20,000,000 in aggregate principal
amount at any one time outstanding;
(i) Indebtedness of the Borrower or any Subsidiary under any Swap
Contracts; provided that (i) such obligations are (or were) entered into by such
Person in the ordinary course of business for the purpose of directly mitigating
risks associated with liabilities, commitments, investments, assets, or property
held or reasonably anticipated by such Person, or changes in the value of
securities issued by such Person, and not for purposes of speculation or taking
a "market view;" and (ii) such Swap Contracts do not contain any provision
exonerating the non-defaulting party from its obligation to make payments on
outstanding transactions to the defaulting party;
(j) Indebtedness of the Borrower under the High Yield Bonds in an
aggregate outstanding principal amount not to exceed $150,000,000, and
Indebtedness of the Borrower used to refinance, refund, renew, extend or
exchange the High Yield Bonds, including in connection with any Exchange Offer;
provided that (A) no Default or Event of Default exists and is continuing at the
time of such refinancing, refunding, renewal or extension above or would be
caused thereby, (B) the terms and conditions of the replacement notes and the
documents evidencing such refinancing, refunding, renewal or extension shall be
in form and substance no more restrictive than this Agreement as reasonably
agreed by the Administrative Agent and (C) the principal amount of the
replacement notes shall not exceed the principal amount set forth above on the
date of such refinancing plus an amount equal to a reasonable premium or other
71
reasonable amount paid, and fees and expenses reasonably incurred, in connection
with such refinancing and by an amount equal to any existing commitments
unutilized thereunder; and
(k) without duplication, Indebtedness consisting of investments
permitted under Section 7.11.
7.03 LIMITATION ON LIENS.
Create, incur, assume or suffer to exist any Lien upon any of its
property, assets or revenues, whether now owned or hereafter acquired, except
for:
(a) Liens for taxes not yet due or which are being contested in good
faith by appropriate proceedings; provided that adequate reserves with respect
thereto are maintained on the books of the Borrower or its Subsidiaries, as the
case may be, in conformity with GAAP (or, in the case of Foreign Subsidiaries,
generally accepted accounting principles in effect from time to time in their
respective jurisdictions of incorporation);
(b) carriers', warehousemen's, mechanics', materialmen's, repairmen's
or other like Liens arising in the ordinary course of business which are not
overdue for a period of more than 60 days or which are being contested in good
faith by appropriate proceedings, if adequate reserves with respect thereto are
maintained on the books of the Borrower or its Subsidiaries, as the case may be,
in conformity with GAAP (or, in the case of Foreign Subsidiaries, generally
accepted accounting principles in effect from time to time in their respective
jurisdictions of incorporation);
(c) pledges or deposits in connection with workers' compensation,
unemployment insurance and other social security legislation and deposits
securing liability to insurance carriers under insurance or self-insurance
arrangements;
(d) deposits to secure the performance of bids, trade contracts (other
than for borrowed money), leases, statutory obligations, surety and appeal
bonds, performance bonds and other obligations of a like nature incurred in the
ordinary course of business;
(e) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount and which do not in any case materially
detract from the value of the property subject thereto or materially interfere
with the ordinary conduct of the business of the Borrower or such Subsidiary;
(f) Liens in existence on the date hereof listed on Schedule 7.03,
securing Indebtedness permitted by Section 7.02(e), provided that no such Lien
is spread to cover any additional property after the Closing Date and that the
amount of Indebtedness secured thereby is not increased;
(g) Liens securing Indebtedness of the Borrower and its Subsidiaries
permitted by Section 7.02(c) incurred to finance the acquisition of fixed or
Capital Assets, provided that (i) such Liens shall be created substantially
simultaneously with the acquisition of such fixed or Capital Assets, (ii) such
Liens do not at any time encumber any property other than the property financed
by such Indebtedness, (iii) the amount of Indebtedness secured thereby is not
increased
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and (iv) the principal amount of Indebtedness secured by any such Lien shall at
no time exceed 90% of the original purchase price of such property of such
property at the time it was acquired;
(h) Liens on assets of any Foreign Subsidiary securing Indebtedness of
such Foreign Subsidiary permitted by Sections 7.02(d);
(i) Liens on the property or assets of a corporation which becomes a
Subsidiary after the date hereof securing Indebtedness permitted by Section
7.02(f), provided that (i) such Liens existed at the time such corporation
became a Subsidiary and were not created in anticipation thereof, (ii) any such
Lien is not spread to cover any property or assets of such corporation after the
time such corporation becomes a Subsidiary, and (iii) the amount of Indebtedness
secured thereby is not increased;
(j) Liens (not otherwise permitted hereunder) which secure obligations
not exceeding (as to the Borrower and all Subsidiaries) $1,000,000 in aggregate
amount at any time outstanding; and
(k) Liens created pursuant to the Security Documents.
7.04 LIMITATION ON GUARANTEE OBLIGATIONS.
Create, incur, assume or suffer to exist any Guarantee Obligation
except:
(a) Guarantee Obligations in existence on the date hereof and listed on
Schedule 7.04;
(b) Guarantee Obligations incurred after the date hereof in an
aggregate amount not to exceed (i) $2,000,000 at any one time outstanding for
the Borrower and its Domestic Subsidiaries and (ii) $2,000,000 at any one time
outstanding for the Borrower's Foreign Subsidiaries;
(c) guarantees made in the ordinary course of its business by the
Borrower of Indebtedness permitted by Section 7.02(c);
(d) Guarantee Obligations in respect of the undrawn portion of the face
amount of letters of credit issued for the account of the Borrower or any
Subsidiary in an aggregate amount not to exceed $2,000,000 at any one time
outstanding for the Borrower and its Subsidiaries;
(e) the Subsidiary Guaranty Agreement;
(f) Guarantee Obligations consisting of obligations of any Loan Party
to pay, reimburse, repurchase or otherwise hold harmless any Person against any
decrease in the market value of the common stock of the Borrower, provided that
for the most recent Rolling Period preceding the incurrence of any such Guaranty
Obligations, the ratio of (A) the Consolidated Senior Indebtedness of the
Borrower as of the last day of such period to (B) Consolidated EBITDA of the
Borrower for such period (calculated on a pro-forma basis as if such Guaranty
Obligations had been incurred as of the first day of such Rolling Period and for
the purposes of calculating Consolidated Senior Indebtedness the amount of such
Guaranty Obligations shall be
73
equal to the amount the applicable Loan Party would be required to pay in
respect of such Guaranty Obligations if the market value of the common stock of
the Borrower was zero but in no event exceed any maximum liability that may be
incurred in respect of such Guaranty Obligations pursuant to and in accordance
with the terms of the instruments creating such Guaranty Obligations) is less
than 1.0 to 1;
(g) Guarantee Obligations in respect of the Consideration Shares (as
defined in the O'Gara Acquisition Agreement) pursuant to Section 2.6 and
Schedule 2.6 of the O'Gara Acquisition Agreement; and
- (h) Guarantee Obligations in respect of Indebtedness permitted
pursuant to Section 7.02(j).
7.05 LIMITATION ON FUNDAMENTAL CHANGES.
Enter into any merger, consolidation or amalgamation, or liquidate,
wind up or dissolve itself (or suffer any liquidation or dissolution), or
convey, sell, lease, assign, transfer or otherwise dispose of, all or
substantially all of its property, business or assets, or make any material
change in its present method of conducting business not otherwise permitted
under Section 7.17, except:
(a) any Subsidiary of the Borrower may be merged or consolidated with
or into the Borrower (provided that the Borrower shall be the continuing or
surviving Person) or with or into any Guarantor (provided that the Guarantor
shall be the continuing or surviving Person);
(b) any wholly owned Subsidiary may sell, lease, transfer or otherwise
dispose of any or all of its assets (upon voluntary liquidation or otherwise) to
the Borrower or any other wholly owned Subsidiary; provided that if the
transferor in such a transaction is a Guarantor, then the transferee must either
be the Borrower or a Guarantor; and
(c) in connection with Permitted Acquisitions.
7.06 LIMITATION ON SALE OF ASSETS.
Convey, sell, lease, assign, transfer or otherwise dispose of any of
its property, business or assets (including, without limitation, receivables and
leasehold interests), whether now owned or hereafter acquired, except:
(a) the sale or other disposition of obsolete or worn out property in
the ordinary course of business;
(b) the sale or other disposition of any property in the ordinary
course of business; provided that (other than inventory) the aggregate book
value of all assets so sold or disposed of in any period of 12 consecutive
months shall not exceed 10% of the sum of (i) consolidated total assets of the
Borrower and its Subsidiaries as at the beginning of such twelve-month period
and (ii) the Net Cash Proceeds from all equity issuances of the Borrower during
such 12 month period;
(c) the sale of inventory in the ordinary course of business;
74
(d) the sale or discount without recourse of accounts receivable
arising in the ordinary course of business in connection with the compromise or
collection thereof;
(e) as permitted by Section 7.05(b);
(f) sales of up to 15% of the book value of the net equity investment
of the Borrower in any Foreign Subsidiary during the term of this Agreement;
(g) sales during any Fiscal Year of the Borrower of assets to which
were attributable to not more than 10% of the Consolidated EBITDA of the
Borrower during the most recently ended previous Fiscal Year (calculated on a
pro forma basis as if all acquisitions and dispositions during such previous
Fiscal Year had occurred at the beginning of such previous Fiscal Year); and
(h) any Qualifying Services Division Sale;
provided that, in the case of any sale or disposition pursuant to
clauses (b), (d), (f), (g) and (h) of this Section, the Net Cash Proceeds of
such transaction shall be applied to the prepayment of the Loans to the extent
provided in Section 2.05(c).
7.07 LIMITATION ON ISSUANCE OF CAPITAL STOCK. Issue or sell any shares
of any Subsidiary's Capital Stock to any Person other than the Borrower or any
wholly owned Subsidiary, except any issuance or sale in which the Net Cash
Proceeds of such transaction are applied to the prepayment of the Loans to the
extent provided in Section 2.05(c).
7.08 LIMITATION ON CHANGES TO CASH MANAGEMENT PRACTICES. Change the
cash management practices of the Borrower and the Subsidiaries from their
practices on the Closing Date in any manner which would have a Material Adverse
Effect.
7.09 LIMITATION ON DIVIDENDS. Declare or pay any dividend (other than
dividends payable solely in common stock of the Borrower) on, or make any
payment on account of, or set apart assets for a sinking or other analogous fund
for, the purchase, redemption, defeasance, retirement or other acquisition of,
any shares of any class of Capital Stock of the Borrower or any warrants or
options to purchase any such Stock, whether now or hereafter outstanding, or
make any other distribution in respect thereof, either directly or indirectly,
whether in cash or property or in obligations of the Borrower or any Subsidiary
(such declarations, payments, setting apart, purchases, redemptions,
defeasances, retirements, acquisitions and distributions being herein called
"Restricted Payments"). Notwithstanding the foregoing, however, the Borrower may
repurchase the Capital Stock of the Borrower pursuant to any currently existing
or subsequently adopted stock repurchase program without any limitation,
provided, that the ratio of Consolidated Senior Indebtedness to Consolidated
EBITDA as of the last day of any Rolling Period (calculated on a pro forma basis
as if such repurchase of Capital Stock of the Borrower, and the incurrence of
any Indebtedness by any Loan Party in connection therewith, had occurred
immediately prior to such day) is less than 1.0 to 1.0. From and after the last
day of any Rolling Period (beginning with the Rolling Period ended immediately
prior to the Closing Date) for which the ratio of Consolidated Senior
Indebtedness to Consolidated EBITDA as of the last day of any such Rolling
Period (calculated on a pro forma basis as if such repurchase of Capital Stock
of the Borrower, and the incurrence of any Indebtedness by any Loan Party in
connection
75
therewith, had occurred immediately prior to such day) is 1.0 to 1.0 or greater
(such day, the "Limitation Date"), the Borrower shall be subject to a limitation
of $15,000,000 in the aggregate for all such repurchases of Capital Stock (the
"Limitation") from and after the Limitation Date. The Limitation described
previously shall not be applicable during any subsequent Rolling Period in which
the ratio described herein for such Rolling Period is less than 1.0 to 1.0. For
any subsequent Rolling Period in which the ratio described herein for such
Rolling Period is 1.0 to 1.0 or greater, the Limitation shall again be
$15,000,000 in the aggregate from and after any such subsequent Rolling Period.
7.10 LIMITATION ON CAPITAL EXPENDITURES. Make or commit to make (by way
of the acquisition of securities of a Person or otherwise) any expenditure in
respect of the purchase or other acquisition of fixed or Capital Assets
(excluding any such asset acquired in connection with normal replacement and
maintenance programs properly charged to current operations) except for
expenditures in connection with Permitted Acquisitions and expenditures in the
ordinary course of business not exceeding $20,000,000, in the aggregate for the
Borrower and its Subsidiaries, during any Fiscal Year, provided that the
Borrower may carry forward up to one-half of such amount for any Fiscal Year to
the immediately succeeding Fiscal Year if such amount is not utilized.
7.11 LIMITATION ON INVESTMENTS, LOANS AND ADVANCES.
Make any advance, loan, extension of credit or capital contribution to,
or purchase any stock, bonds, notes, debentures or other securities of or any
assets constituting a business unit of, or make any other investment in, any
Person, except :
(a) extensions of trade credit in the ordinary course of business;
(b) investments in Cash Equivalents;
(c) in connection with Permitted Acquisitions;
(d) loans to officers of the Borrower listed on Schedule 7.11 in
aggregate principal amounts outstanding not to exceed the respective amounts set
forth for such officers on said Schedule;
(e) loans and advances to employees of the Borrower or its Subsidiaries
for travel, entertainment and relocation expenses in the ordinary course of
business in an aggregate amount for the Borrower and its Subsidiaries not to
exceed $250,000 at any one time outstanding;
(f) investments by the Borrower in Guarantors and investments by such
Guarantors in the Borrower and in other Guarantors;
(g) loans by the Borrower to its employees in connection with
management incentive plans in an aggregate amount not to exceed $500,000;
(h) investments in Foreign Subsidiaries (i) made prior to the Closing
Date, or (ii) made from and after the Closing Date in an aggregate amount,
together with the aggregate
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principal amount of all Indebtedness outstanding pursuant to Section 7.02(d),
not exceeding $15,000,000 at any time outstanding;
(i) venture investments for purposes of technological development
related to the lines of business described in Section 7.17 in an aggregate
amount not to exceed at any time 5% of the book value of the equity of the
Borrower at such time;
(j) open-market purchases of publicly traded securities made for the
ultimate purpose of consummating a Permitted Acquisition in an aggregate amount
not to exceed, at any time prior to the consummation of such Permitted
Acquisition, $20,000,000; and
(k) investments consisting of Indebtedness permitted under Section
7.02.
7.12 LIMITATION ON OPTIONAL PAYMENTS AND MODIFICATIONS OF DEBT
INSTRUMENTS AND ACQUISITION DOCUMENTS.
(a) Make any optional payment or prepayment on or redemption or
purchase of any Indebtedness (other than (i) the Loans and (ii) so long as no
Default or Event of Default exists at the time of such optional payment,
prepayment or redemption or purchase, or would result therefrom, Indebtedness
permitted under Section 7.02(f) which was incurred in connection with a
Permitted Acquisition), or (b) amend, modify or change, or consent or agree to
any amendment, modification or change to any of the terms of any such
Indebtedness (other than any such amendment, modification or change which would
extend the maturity or reduce the amount of any payment of principal thereof or
which would reduce the rate or extend the date for payment of interest thereon).
7.13 LIMITATION ON TRANSACTIONS WITH AFFILIATES. Enter into any
transaction, including, without limitation, any purchase, sale, lease or
exchange of property, the rendering of any service, or the payment of any
management fees or management compensation, with any Affiliate unless such
transaction is (a) otherwise permitted under this Agreement, (b) in the ordinary
course of the Borrower's or such Subsidiary's business and (c) upon fair and
reasonable terms no less favorable to the Borrower or such Subsidiary, as the
case may be, than it would obtain in a comparable arm's length transaction with
a Person which is not an Affiliate.
7.14 LIMITATION ON SALES AND LEASEBACKS. Enter into any arrangement
with any Person providing for the leasing by the Borrower or any Subsidiary of
real or personal property which has been or is to be sold or transferred by the
Borrower or such Subsidiary to such Person or to any other Person to whom funds
have been or are to be advanced by such Person on the security of such property
or rental obligations of the Borrower or such Subsidiary, except for such
transactions that do not exceed $10,000,000 in the aggregate during the term of
this Agreement.
7.15 LIMITATION ON CHANGES IN FISCAL YEAR. Permit the Fiscal Year of
the Borrower to end on a day other than December 31.
7.16 LIMITATION ON NEGATIVE PLEDGE CLAUSES. Enter into with any Person
any Contractual Obligation (other than this Agreement or any other Loan
Document) that prohibits or limits the ability of (a) any Subsidiary to make
dividends to the Borrower or any Guarantor or to
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otherwise transfer property to the Borrower or any Guarantor, (b) any Subsidiary
to guarantee the Indebtedness of the Borrower or (c) the Borrower or any of its
Subsidiaries to create, incur, assume or suffer to exist any Lien upon any of
its property, assets or revenues, whether now owned or hereafter acquired;
provided that this clause (c) shall not prohibit any negative pledge incurred or
provided in favor of any holder of industrial revenue bonds, purchase money
mortgages or Capital Leases otherwise permitted by this Agreement (in which
cases, any prohibition or limitation shall only be effective against the assets
financed thereby).
7.17 LIMITATION ON LINES OF BUSINESS. Enter into any business, either
directly or through any Subsidiary, except for businesses having some material
application to the manufacture, development, distribution, marketing and sale of
law enforcement and military use products and security, investigative, risk
management, safety and similar business services, and lines of business related
thereto.
7.18 GOVERNING DOCUMENTS. Amend its certificate of incorporation
(except to increase the number of authorized shares of common stock),
partnership agreement or other Governing Documents, without the prior written
consent of the Required Lenders, which shall not be unreasonably withheld or
delayed; provided, however, that the Required Lenders' prior written consent
shall not be necessary for any name, address or service of process amendment to
any Governing Documents of any Subsidiary provided that the Administrative Agent
receives written notice within ten Business Days of such amendment.
7.19 LIMITATION ON SUBSIDIARY FORMATION. Form any Subsidiaries unless,
immediately upon the formation of such Subsidiary, all requirements of Section
6.09 shall have been satisfied.
7.20 LIMITATION ON SECURITIES ISSUANCES. (A) Permit any Domestic
Subsidiary to issue any shares of Capital Stock that are not "certificated
securities" (as defined in ss. 8-102 of the Uniform Commercial Code as in effect
in the State of New York on the date hereof) and are not pledged to the
Administrative Agent pursuant to the Collateral Agreement or (B) issue or permit
any Subsidiary to issue any shares of preferred stock.
7.21 AMENDMENTS, PAYMENTS AND PREPAYMENTS OF HIGH YIELD BONDS.
(a) Amend or modify (or permit the amendment or modification of) any of
the terms or provisions of the High Yield Bonds in any respect which would
materially adversely affect the rights or interests of the Administrative Agent
and the Lenders.
(b) Purchase, defease, make any payment or prepayment on (including any
sinking fund payment), or redeem or acquire for value (including by way of
depositing with any trustee with respect thereto money or securities before due
for the purpose of paying when due), the High Yield Bonds (including making any
offer to do any of the foregoing), other than (i) refinancing, refundings,
renewals, extensions or exchanges of the High Yield Bonds, including in
connection with any Exchange Offer, pursuant to Section 7.02(j) and (ii)
regularly scheduled payments of accrued interest on the High Yield Bonds.
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ARTICLE VIII.
EVENTS OF DEFAULT AND REMEDIES
8.01 EVENTS OF DEFAULT. Any of the following shall constitute an Event
of Default:
(a) The Borrower shall fail to pay any principal of any Loan when due
in accordance with the terms hereof and in the currency required hereunder; or
the Borrower shall fail to pay any interest on any Loan, or any other amount
payable hereunder or under the other Loan Documents or the Fee Letter, within
five days after any such interest or other amount becomes due in accordance with
the terms thereof or hereof and in the currency required hereunder; or
(b) Any representation or warranty made or deemed made by the Borrower
or any other Loan Party herein or in any other Loan Document or which is
contained in any certificate, document or financial or other statement furnished
by it at any time under or in connection with this Agreement or any such other
Loan Document shall prove to have been incorrect in any material respect on or
as of the date made or deemed made; or
(c) The Borrower or any other Loan Party shall default in the
observance or performance of any agreement contained in Section 6.04 (with
respect to any Loan Party), Section 6.07(a) or Article VII or Sections 4.06 or
4.10 of the Collateral Agreement; or
(d) The Borrower or any other Loan Party shall default in the
observance or performance of any other material agreement contained in this
Agreement or any other Loan Document (other than as provided in paragraphs (a)
through (c) of this Section), and such default shall continue unremedied for a
period of 30 days; or
(e) The Borrower or any of its Subsidiaries shall (i) default in any
payment of principal of or interest of any Indebtedness (other than the Loans)
or in the payment of any Guarantee Obligation, beyond the period of grace (not
to exceed 30 days), if any, provided in the instrument or agreement under which
such Indebtedness or Guarantee Obligation was created, if the aggregate amount
of the Indebtedness and/or Guarantee Obligations in respect of which such
default or defaults shall have occurred is at least $1,000,000; or (ii) default
in the observance or performance of any other agreement or condition relating to
any such Indebtedness or Guarantee Obligation or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event shall
occur or condition exist, the effect of which default or other event or
condition is to cause, or to permit the holder or holders of such Indebtedness
or beneficiary or beneficiaries of such Guarantee Obligation (or a trustee or
Administrative Agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, with the giving of notice if required, such
Indebtedness to become due prior to its stated maturity or such Guarantee
Obligation to become payable; or
(f) (i) The Borrower or any of its Subsidiaries shall commence any
case, proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or (B)
seeking appointment of a receiver, trustee,
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custodian, conservator or other similar official for it or for all or any
substantial part of its assets, or the Borrower or any of its Subsidiaries shall
make a general assignment for the benefit of its creditors; or (ii) there shall
be commenced against the Borrower or any of its Subsidiaries any case,
proceeding or other action of a nature referred to in clause (i) above which (A)
results in the entry of an order for relief or any such adjudication or
appointment or (B) remains undismissed, undischarged or unbonded for a period of
60 days; or (iii) there shall be commenced against the Borrower or any of its
Subsidiaries any case, proceeding or other action seeking issuance of a warrant
of attachment, execution, distraint or similar process against all or any
substantial part of its assets which results in the entry of an order for any
such relief which shall not have been vacated, discharged, or stayed or bonded
pending appeal within 60 days from the entry thereof; or (iv) the Borrower or
any of its Subsidiaries shall take any action in furtherance of, or indicating
its consent to, approval of, or acquiescence in, any of the acts set forth in
clause (i), (ii), or (iii) above; or (v) the Borrower or any of its Subsidiaries
shall generally not, or shall be unable to, or shall admit in writing its
inability to, pay its debts as they become due; or
(g) (i) Any Person shall engage in any "prohibited transaction" (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan,
(ii) any "accumulated funding deficiency" (as defined in Section 302 of ERISA),
whether or not waived, shall exist with respect to any Plan or any Lien in favor
of the PBGC or a Plan shall arise on the assets of the Borrower or any ERISA
Affiliate, (iii) an ERISA Event shall occur with respect to, or proceedings
shall commence to have a trustee appointed, or a trustee shall be appointed, to
administer or to terminate, any Pension Plan, which ERISA Event or commencement
of proceedings or appointment of a trustee is, in the reasonable opinion of the
Required Lenders, likely to result in the termination of such Plan for purposes
of Title IV of ERISA, (iv) any Pension Plan shall terminate for purposes of
Title IV of ERISA, (v) the Borrower or any ERISA Affiliate shall, or in the
reasonable opinion of the Required Lenders is likely to, incur any liability in
connection with a withdrawal from, a Multiemployer Plan or (vi) any other event
or condition shall occur or exist with respect to a Plan; and in each case in
clauses (i) through (vi) above, such event or condition, together with all other
such events or conditions, if any, could reasonably be expected to have a
Material Adverse Effect; or
(h) One or more judgments or decrees shall be entered against the
Borrower or any of its Subsidiaries involving in the aggregate a liability (not
paid or fully covered by insurance) of $1,000,000 or more, and all such
judgments or decrees shall not have been vacated, discharged, stayed or bonded
pending appeal within 60 days from the entry thereof; or
(i) (i) Any of the Security Documents shall cease, for any reason, to
be in full force and effect, or the Borrower or any other Loan Party which is a
party to any of the Security Documents shall so assert or (ii) the Lien created
by any of the Security Documents shall cease to be enforceable and of the same
effect and priority purported to be created thereby; or
(j) The Subsidiary Guaranty Agreement shall cease, for any reason, to
be in full force and effect or any Guarantor shall so assert; or
(k) (i) Any Person or "group" (within the meaning of Section 13(d) or
14(d) of the Securities Exchange Act of 1934, as amended) other than the
existing executive officers and
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directors of the Borrower as of the Closing Date and their Affiliates (A) shall
have acquired beneficial ownership of 25% or more of any outstanding class of
Capital Stock having ordinary voting power in the election of directors of the
Borrower or (B) shall obtain the power (whether or not exercised) to elect a
majority of the Borrower's directors or (ii) the Board of Directors of the
Borrower shall not consist of a majority of Continuing Directors; "Continuing
Directors" shall mean the directors of the Borrower on the Closing Date and each
other director, if such other director's nomination for election to the Board of
Directors of the Borrower is recommended by a majority of the then Continuing
Directors.
8.02 REMEDIES UPON EVENT OF DEFAULT. If any Event of Default occurs and
is continuing, the Administrative Agent shall, at the request of, or may, with
the consent of, the Required Lenders, take any or all of the following actions:
(a) declare the commitment of each Lender to make Loans and any
obligation of the L/C Issuer to make L/C Credit Extensions to be terminated,
whereupon such commitments and obligation shall be terminated;
(b) declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Borrower;
(c) require that the Borrower Cash Collateralize the L/C Obligations in
an amount equal to the then Outstanding Amount thereof; and
(d) exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents or applicable
Law;
provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to the Borrower under the Bankruptcy Code of the
United States, the obligation of each Lender to make Loans and any obligation of
the L/C Issuer to make L/C Credit Extensions shall automatically terminate, the
unpaid principal amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable, and the
obligation of the Borrower to Cash Collateralize the L/C Obligations as
aforesaid shall automatically become effective, in each case without further act
of the Administrative Agent or any Lender.
8.03 APPLICATION OF FUNDS. After the exercise of remedies provided for
in Section 8.02 (or after the Loans have automatically become immediately due
and payable and the L/C Obligations have automatically been required to be Cash
Collateralized as set forth in the proviso to Section 8.02), any amounts
received on account of the Obligations shall be applied by the Administrative
Agent in the following order:
First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including Attorney Costs and amounts
payable under Article III) payable to the Administrative Agent in its capacity
as such;
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Second, to payment of that portion of the Obligations constituting
fees, indemnities and other amounts (other than principal and interest) payable
to the Lenders (including Attorney Costs and amounts payable under Article III),
ratably among them in proportion to the amounts described in this clause Second
payable to them;
Third, to payment of that portion of the Obligations constituting
accrued and unpaid interest on the Loans and L/C Borrowings, ratably among the
Lenders in proportion to the respective amounts described in this clause Third
payable to them;
Fourth, to payment of that portion of the Obligations constituting
unpaid principal of the Loans and L/C Borrowings and unpaid termination payments
due in respect of a Swap Contract with any with any Person that is a Lender or
an Affiliate thereof at the time such Swap Contract was executed, ratably among
the Lenders in proportion to the respective amounts described in this clause
Fourth held by them;
Fifth, to the Administrative Agent for the account of the L/C Issuer,
to Cash Collateralize that portion of L/C Obligations comprised of the aggregate
undrawn amount of Letters of Credit; and
Last, the balance, if any, after all of the Obligations have been
indefeasibly paid in full, to the Borrower or as otherwise required by Law.
Subject to Section 2.03(c), amounts used to Cash Collateralize the aggregate
undrawn amount of Letters of Credit pursuant to clause Fifth above shall be
applied to satisfy drawings under such Letters of Credit as they occur. If any
amount remains on deposit as Cash Collateral after all Letters of Credit have
either been fully drawn or expired, such remaining amount shall be applied to
the other Obligations, if any, in the order set forth above.
ARTICLE IX.
ADMINISTRATIVE AGENT
9.01 APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT.
(a) Each Lender hereby irrevocably appoints, designates and authorizes
the Administrative Agent to take such action on its behalf under the provisions
of this Agreement and each other Loan Document and to exercise such powers and
perform such duties as are expressly delegated to it by the terms of this
Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere herein or in any other Loan Document, the Administrative
Agent shall not have any duties or responsibilities, except those expressly set
forth herein, nor shall the Administrative Agent have or be deemed to have any
fiduciary relationship with any Lender or participant, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Loan Document or otherwise exist against the
Administrative Agent. Without limiting the generality of the foregoing sentence,
the use of the term "agent" herein and in the other Loan Documents with
reference to the Administrative Agent is not intended to connote any fiduciary
or other implied (or express) obligations arising under
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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.
(b) The L/C Issuer shall act on behalf of the Lenders with respect to
any Letters of Credit issued by it and the documents associated therewith, and
the L/C Issuer shall have all of the benefits and immunities (i) provided to the
Administrative Agent in this Article IX with respect to any acts taken or
omissions suffered by the L/C Issuer in connection with Letters of Credit issued
by it or proposed to be issued by it and the applications and agreements for
letters of credit pertaining to such Letters of Credit as fully as if the term
"Administrative Agent" as used in this Article IX and in the definition of
"Agent-Related Person" included the L/C Issuer with respect to such acts or
omissions, and (ii) as additionally provided herein with respect to the L/C
Issuer.
9.02 DELEGATION OF DUTIES. The Administrative Agent may execute any of
its duties under this Agreement or any other Loan Document by or through agents,
employees or attorneys-in-fact, including, for the purposes of any Borrowings or
payments in Alternative Currencies, such sub-administrative agents as shall be
deemed necessary by the Administrative Agent, and shall be entitled to advice of
counsel and other consultants or experts concerning all matters pertaining to
such duties. The Administrative Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects in the
absence of gross negligence or willful misconduct. Any such agent, sub-agent or
other Person retained or employed pursuant to this Section 9.02 shall have all
the benefits and immunities provided to the Administrative Agent in this Article
IX with respect to any acts taken or omissions suffered by such Person in
connection herewith or therewith, as fully as if the term "Administrative Agent"
as used in this Article IX and in the definition of "Agent-Related Person"
included such additional Persons with respect to such acts or omissions.
9.03 LIABILITY OF ADMINISTRATIVE AGENT. No Agent-Related Person shall
(a) be liable for any action taken or omitted to be taken by any of them under
or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct in connection with its duties expressly set forth herein), or (b) be
responsible in any manner to any Lender or participant for any recital,
statement, representation or warranty made by any Loan Party or any officer
thereof, contained herein or in any other Loan Document, or in any certificate,
report, statement or other document referred to or provided for in, or received
by the Administrative Agent under or in connection with, this Agreement or any
other Loan Document, or the validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document, or for any failure
of any Loan Party or any other party to any Loan Document to perform its
obligations hereunder or thereunder. No Agent-Related Person shall be under any
obligation to any Lender or participant to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the properties,
books or records of any Loan Party or any Affiliate thereof.
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9.04 RELIANCE BY ADMINISTRATIVE AGENT.
(a) The Administrative Agent shall be entitled to rely, and shall be
fully protected in relying, upon any writing, communication, signature,
resolution, representation, notice, consent, certificate, affidavit, letter,
telegram, facsimile, telex or telephone message, electronic mail message,
statement 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 counsel to any Loan
Party), independent accountants and other experts selected by the Administrative
Agent. The Administrative Agent shall be fully justified in failing or refusing
to take any action under any Loan Document unless it shall first receive such
advice or concurrence of the Required Lenders as it deems appropriate and, if it
so requests, 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 Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, under
this Agreement or any other Loan Document in accordance with a request or
consent of the Required Lenders (or such greater number of Lenders as may be
expressly required hereby in any instance) and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 4.01, each Lender that has signed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter required thereunder to be consented to or approved by
or acceptable or satisfactory to a Lender unless the Administrative Agent shall
have received notice from such Lender prior to the proposed Closing Date
specifying its objection thereto.
9.05 NOTICE OF DEFAULT. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default, except with respect
to defaults in the payment of principal, interest and fees required to be paid
to the Administrative Agent for the account of the Lenders, unless the
Administrative Agent shall have received written notice from a Lender or the
Borrower referring to this Agreement, describing such Default and stating that
such notice is a "notice of default." The Administrative Agent will notify the
Lenders of its receipt of any such notice. The Administrative Agent shall take
such action with respect to such Default as may be directed by the Required
Lenders in accordance with Article VIII; 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 as it shall deem
advisable or in the best interest of the Lenders.
9.06 CREDIT DECISION; DISCLOSURE OF INFORMATION BY ADMINISTRATIVE
AGENT. Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by the Administrative Agent
hereafter taken, including any consent to and acceptance of any assignment or
review of the affairs of any Loan Party or any Affiliate thereof, shall be
deemed to constitute any representation or warranty by any Agent-Related Person
to any Lender as to any matter, including whether Agent-Related Persons have
disclosed material information in their possession. Each Lender represents to
the Administrative Agent that it has, independently and without reliance upon
any Agent-Related Person and based on such
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documents and information as it has deemed appropriate, made its own appraisal
of and investigation into the business, prospects, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their
respective Subsidiaries, and all applicable bank or other regulatory Laws
relating to the transactions contemplated hereby, and made its own decision to
enter into this Agreement and to extend credit to the Borrower and the other
Loan Parties hereunder. Each Lender also represents that it will, independently
and without reliance upon any Agent-Related Person and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make such
investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Borrower and the other Loan Parties. Except for notices,
reports and other documents expressly required to be furnished to the Lenders by
the Administrative Agent herein, the Administrative Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, prospects, operations, property, financial
and other condition or creditworthiness of any of the Loan Parties or any of
their respective Affiliates which may come into the possession of any
Agent-Related Person.
9.07 INDEMNIFICATION OF ADMINISTRATIVE AGENT. Whether or not the
transactions contemplated hereby are consummated, the Lenders shall indemnify
upon demand each Agent-Related Person (to the extent not reimbursed by or on
behalf of any Loan Party and without limiting the obligation of any Loan Party
to do so), pro rata, and hold harmless each Agent-Related Person for, from and
against any and all Indemnified Liabilities incurred by it; provided, however,
that no Lender shall be liable for the payment to any Agent-Related Person of
any portion of such Indemnified Liabilities to the extent determined in a final,
nonappealable judgment by a court of competent jurisdiction to have resulted
from such Agent-Related Person's own 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. 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 Attorney Costs) 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 Loan
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. The undertaking in this Section shall survive
termination of the Aggregate Commitments, the payment of all other Obligations
and the resignation of the Administrative Agent.
9.08 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. Bank of America
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 or other business
with each of the Loan Parties and their respective Affiliates as though Bank of
America were not the Administrative Agent or the L/C Issuer hereunder and
without notice to or consent of the Lenders. The Lenders acknowledge that,
pursuant to such activities, Bank of America or its Affiliates may receive
information regarding any Loan Party or its Affiliates (including information
that may be subject to confidentiality obligations in favor of
85
such Loan Party or such Affiliate) and acknowledge that the Administrative Agent
shall be under no obligation to provide such information to them. With respect
to its Loans, Bank of America shall have the same rights and powers under this
Agreement as any other Lender and may exercise such rights and powers as though
it were not the Administrative Agent or the L/C Issuer, and the terms "Lender"
and "Lenders" include Bank of America in its individual capacity.
9.09 SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may
resign as Administrative Agent upon 30 days' notice to the Lenders; provided
that any such resignation by Bank of America shall also constitute its
resignation as L/C Issuer and Swing Line Lender. If the Administrative Agent
resigns under this Agreement, the Required Lenders shall appoint from among the
Lenders a successor administrative agent for the Lenders, which successor
administrative 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 administrative
agent is appointed prior to the effective date of the resignation of the
Administrative Agent, the Administrative Agent may appoint, after consulting
with the Lenders and the Borrower, a successor administrative agent from among
the Lenders. Upon the acceptance of its appointment as successor administrative
agent hereunder, the Person acting as such successor administrative agent shall
succeed to all the rights, powers and duties of the retiring Administrative
Agent, L/C Issuer and Swing Line Lender and the respective terms "Administrative
Agent," "L/C Issuer" and "Swing Line Lender" shall mean such successor
administrative agent, Letter of Credit issuer and swing line lender, and the
retiring Administrative Agent's appointment, powers and duties as Administrative
Agent shall be terminated and the retiring L/C Issuer's and Swing Line Lender's
rights, powers and duties as such shall be terminated, without any other or
further act or deed on the part of such retiring L/C Issuer or Swing Line Lender
or any other Lender, other than the obligation of the successor L/C Issuer to
issue letters of credit in substitution for the Letters of Credit, if any,
outstanding at the time of such succession or to make other arrangements
satisfactory to the retiring L/C Issuer to effectively assume the obligations of
the retiring L/C Issuer with respect to such Letters of Credit. After any
retiring Administrative Agent's resignation hereunder as Administrative Agent,
the provisions of this Article IX and Sections 10.04 and 10.05 shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement. If no successor administrative agent
has accepted appointment as Administrative Agent by the date which is 30 days
following a retiring Administrative Agent's notice of resignation, the retiring
Administrative Agent's resignation shall nevertheless thereupon become effective
and the Lenders shall perform all of the duties of the Administrative Agent
hereunder until such time, if any, as the Required Lenders appoint a successor
agent as provided for above.
9.10 ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to any Loan Party, the Administrative Agent (irrespective of
whether the principal of any Loan or L/C Obligation shall then be due and
payable as herein expressed or by declaration or otherwise and irrespective of
whether the Administrative Agent shall have made any demand on the Borrower)
shall be entitled and empowered, by intervention in such proceeding or otherwise
(a) to file and prove a claim for the whole amount of the
principal and interest owing and unpaid in respect of the Loans, L/C
Obligations and all other Obligations that
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are owing and unpaid and to file such other documents as may be
necessary or advisable in order to have the claims of the Lenders and
the Administrative Agent (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Lenders and
the Administrative Agent and their respective agents and counsel and
all other amounts due the Lenders and the Administrative Agent under
Sections 2.03(i) and (j), 2.09 and 10.04) allowed in such judicial
proceeding; and
(b) to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to the Administrative Agent and, in the event
that the Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to the Administrative Agent any amount due for
the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Sections 2.09 and 10.04.
Nothing contained herein shall be deemed to authorize the
Administrative Agent to authorize or consent to or accept or adopt on behalf of
any Lender any plan of reorganization, arrangement, adjustment or composition
affecting the Obligations or the rights of any Lender or to authorize the
Administrative Agent to vote in respect of the claim of any Lender in any such
proceeding.
9.11 COLLATERAL AND GUARANTY MATTERS. The Lenders irrevocably authorize
the Administrative Agent, at its option and in its discretion,
(a) to release any Lien on any property granted to or held by the
Administrative Agent under any Loan Document (i) upon termination of the
Aggregate Commitments and payment in full of all Obligations (other than
contingent indemnification obligations) and the expiration or termination of all
Letters of Credit, (ii) that is sold or to be sold as part of or in connection
with any sale permitted hereunder or under any other Loan Document, or (iii)
subject to Section 10.01, if approved, authorized or ratified in writing by the
Required Lenders;
(b) to subordinate any Lien on any property granted to or held by the
Administrative Agent under any Loan Document to the holder of any Lien on such
property that is permitted by Section 7.01(i); and
(c) to release any Guarantor from its obligations under the Subsidiary
Guaranty Agreement if such Person ceases to be a Subsidiary as a result of a
transaction permitted hereunder.
Upon request by the Administrative Agent at any time, the Required
Lenders will confirm in writing the Administrative Agent's authority to release
or subordinate its interest in particular types or items of property, or to
release any Guarantor from its obligations under the Subsidiary Guaranty
Agreement pursuant to this Section 9.11.
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9.12 OTHER AGENTS; ARRANGERS AND MANAGERS. None of the Lenders or other
Persons identified on the facing page or signature pages of this Agreement as a
"syndication agent," "documentation agent," "co-agent," "book manager," "lead
manager," "arranger," "lead arranger" or "co-arranger" shall have any right,
power, obligation, liability, responsibility or duty under this Agreement other
than, in the case of such Lenders, those applicable to all Lenders as such.
Without limiting the foregoing, none of the Lenders or other Persons so
identified shall have or be deemed to have any fiduciary relationship with any
Lender. 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.
ARTICLE X.
MISCELLANEOUS
10.01 AMENDMENTS, ETC. No amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any departure by the
Borrower or any other Loan Party therefrom, shall be effective unless in writing
signed by the Required Lenders and the Borrower or the applicable Loan Party, as
the case may be, and acknowledged by the Administrative Agent, and each such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that no such amendment,
waiver or
consent shall:
(a) extend or increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 8.02) without the written consent of
such Lender;
(b) postpone any date fixed by this Agreement or any other Loan
Document for any payment (excluding mandatory prepayments) of principal,
interest, fees or other amounts due to the Lenders (or any of them) hereunder or
under any other Loan Document without the written consent of each Lender
directly affected thereby;
(c) reduce the principal of, or the rate of interest specified herein
on, any Loan or L/C Borrowing, or (subject to clause (iv) of the second proviso
to this Section 10.01) any fees or other amounts payable hereunder or under any
other Loan Document without the written consent of each Lender directly affected
thereby; provided, however, that only the consent of the Required Lenders shall
be necessary (i) to amend the definition of "Default Rate" or to waive any
obligation of the Borrower to pay interest at the Default Rate or (ii) to amend
any financial covenant hereunder (or any defined term used therein) even if the
effect of such amendment would be to reduce the rate of interest on any Loan or
L/C Borrowing or to reduce any fee payable hereunder;
(d) change Section 2.13 or Section 8.03 in a manner that would alter
the pro rata sharing of payments required thereby without the written consent of
each Lender;
(e) change any provision of this Section or the definition of "Required
Lenders" or any other provision hereof specifying the number or percentage of
Lenders required to amend, waive or otherwise modify any rights hereunder or
make any determination or grant any consent hereunder, without the written
consent of each Lender;
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(f) change Section 1.08 or the definition of "Alternative Currency"
without the written consent of each Lender; or
(g) release any Guarantor from the Subsidiary Guaranty Agreement or all
or a material portion of the Collateral or release any Security Document (other
than asset sales permitted pursuant to Section 7.05 and as otherwise
specifically permitted or contemplated in this Agreement or the applicable
Security Document) without the written consent of each Lender;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Lenders required above,
affect the rights or duties of the L/C Issuer under this Agreement or any Letter
of Credit Application relating to any Letter of Credit issued or to be issued by
it; (ii) no amendment, waiver or consent shall, unless in writing and signed by
the Swing Line Lender in addition to the Lenders required above, affect the
rights or duties of the Swing Line Lender under this Agreement; (iii) no
amendment, waiver or consent shall, unless in writing and signed by the
Administrative Agent in addition to the Lenders required above, affect the
rights or duties of the Administrative Agent under this Agreement or any other
Loan Document; and (iv) the Fee Letter may be amended, or rights or privileges
thereunder waived, in a writing executed only by the parties thereto.
Notwithstanding anything to the contrary herein, no Defaulting Lender shall have
any right to approve or disapprove any amendment, waiver or consent hereunder,
except that the Commitment of such Lender may not be increased or extended
without the consent of such Lender.
10.02 NOTICES AND OTHER COMMUNICATIONS; FACSIMILE COPIES.
(a) General. Unless otherwise expressly provided herein, all notices
and other communications provided for hereunder shall be in writing (including
by facsimile transmission). All such written notices shall be mailed, faxed or
delivered to the applicable address, facsimile number or (subject to subsection
(c) below) electronic mail address, and all notices and other communications
expressly permitted hereunder to be given by telephone shall be made to the
applicable telephone number, as follows:
(i) if to the Borrower, the Administrative Agent, the L/C
Issuer or the Swing Line Lender, to the address, facsimile number,
electronic mail address or telephone number specified for such Person
on Schedule 10.02 or to such other address, facsimile number,
electronic mail address or telephone number as shall be designated by
such party in a notice to the other parties; and
(ii) if to any other Lender, to the address, facsimile number,
electronic mail address or telephone number specified in its
Administrative Questionnaire or to such other address, facsimile
number, electronic mail address or telephone number as shall be
designated by such party in a notice to the Borrower, the
Administrative Agent, the L/C Issuer and the Swing Line 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 relevant party hereto and
(ii) (A) if delivered by hand or by courier, when signed for by or on behalf of
the relevant party hereto; (B) if delivered by mail,
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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, the L/C Issuer and
the Swing Line Lender pursuant to Article II shall not be effective until
actually received by such Person. In no event shall a voicemail message be
effective as a notice, communication or confirmation hereunder.
(b) Effectiveness of Facsimile Documents and Signatures. Loan Documents
may be transmitted and/or signed by facsimile. The effectiveness of any such
documents and signatures shall, subject to applicable Law, have the same force
and effect as manually-signed originals and shall be binding on all Loan
Parties, the Administrative Agent 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 the failure to request
or deliver the same shall not limit the effectiveness of any facsimile document
or signature.
(c) Limited Use of Electronic Mail. Electronic mail and Internet and
intranet websites may be used only to distribute routine communications, such as
financial statements and other information as provided in Section 6.02, and to
distribute Loan Documents for execution by the parties thereto, and may not be
used for any other purpose.
(d) Reliance by Administrative Agent and Lenders. The Administrative
Agent and the Lenders shall be entitled to rely and act upon any notices
(including telephonic Committed Loan Notices and Swing Line Loan Notices)
purportedly given by or on behalf of the Borrower 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-Related Person and each Lender for, from
and against 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.
10.03 NO WAIVER; CUMULATIVE REMEDIES. No failure by any Lender or the
Administrative Agent to exercise, and no delay by any such Person in exercising,
any right, remedy, power or privilege hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.
10.04 ATTORNEY COSTS, EXPENSES AND TAXES. The Borrower agrees (a) to
pay or reimburse the Administrative Agent for all reasonable costs and expenses
incurred in connection with the development, preparation, negotiation,
execution, filing, recording and insurance of this Agreement and the other Loan
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 and administration of
the
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transactions contemplated hereby and thereby, including all Attorney Costs, and
(b) to pay or reimburse the Administrative 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 Loan Documents (including all such costs and expenses
incurred during any "workout" or restructuring in respect of the Obligations and
during any legal proceeding, including any proceeding under any Debtor Relief
Law), including all Attorney Costs. 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 the
Administrative Agent and the cost of independent public accountants and other
outside experts retained by the Administrative Agent or any Lender. All amounts
due under this Section 10.04 shall be payable within ten Business Days after
demand therefor. The agreements in this Section shall survive the termination of
the Aggregate Commitments and repayment of all other Obligations.
10.05 INDEMNIFICATION BY THE BORROWER. Whether or not the transactions
contemplated hereby are consummated, the Borrower shall indemnify and hold
harmless each Agent-Related Person, each Lender and their respective Affiliates,
directors, officers, employees, counsel, agents and attorneys-in-fact
(collectively the "Indemnitees") for, from and against any and all liabilities,
obligations, losses, damages, penalties, claims, demands, actions, judgments,
suits, costs, expenses and disbursements (including Attorney Costs) of any kind
or nature whatsoever which may at any time be imposed on, incurred by or
asserted against any such Indemnitee in any way relating to or arising out of or
in connection with (a) the execution, delivery, enforcement, performance or
administration of any Loan Document or any other agreement, letter or instrument
delivered in connection with the transactions contemplated thereby or the
consummation of the transactions contemplated thereby, (b) any Commitment, Loan
or Letter of Credit or the use or proposed use of the proceeds therefrom
(including any refusal by the L/C Issuer to honor a demand for payment under a
Letter of Credit if the documents presented in connection with such demand do
not strictly comply with the terms of such Letter of Credit), or (c) any actual
or alleged presence or release of Hazardous Materials on or from any property
currently or formerly owned or operated by the Borrower, any Subsidiary or any
other Loan Party, or any Environmental Liability related in any way to the
Borrower, any Subsidiary or any other Loan Party, or (d) any actual or
prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory (including
any investigation of, preparation for, or defense of any pending or threatened
claim, investigation, litigation or proceeding) and regardless of whether any
Indemnitee is a party thereto (all the foregoing, collectively, the "Indemnified
Liabilities"), in all cases, whether or not caused by or arising, in whole or in
part, out of the negligence of the Indemnitee; provided that such indemnity
shall not, as to any Indemnitee, be available to the extent that such
liabilities, obligations, losses, damages, penalties, claims, demands, actions,
judgments, suits, costs, expenses or disbursements are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted from
the gross negligence or willful misconduct of such Indemnitee. No Indemnitee
shall be liable for any damages arising from the use by others of any
information or other materials obtained through IntraLinks or other similar
information transmission systems in connection with this Agreement, nor shall
any Indemnitee have any liability for any indirect or consequential damages
relating to this Agreement or any other Loan Document or arising out of its
activities in connection herewith or therewith (whether before or after the
Closing Date). All amounts due under this Section 10.05
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shall be payable within ten Business Days after demand therefor. The agreements
in this Section shall survive the resignation of the Administrative Agent, the
replacement of any Lender, the termination of the Aggregate Commitments and the
repayment, satisfaction or discharge of all the other Obligations.
10.06 PAYMENTS SET ASIDE. To the extent that any payment by or on
behalf of the Borrower is made to the Administrative Agent or any Lender, or the
Administrative Agent or any Lender exercises its right of set-off, and such
payment or the proceeds of such set-off or any part thereof is subsequently
invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by the Administrative Agent
or such Lender in its discretion) to be repaid to a trustee, receiver or any
other party, in connection with any proceeding under any Debtor Relief Law or
otherwise, then (a) to the extent of such recovery, the obligation or part
thereof originally intended to be satisfied shall be revived and continued in
full force and effect as if such payment had not been made or such set-off had
not occurred, and (b) each Lender severally agrees to pay to the Administrative
Agent upon demand its applicable share of any amount so recovered from or repaid
by the Administrative Agent, plus interest thereon from the date of such demand
to the date such payment is made at a rate per annum equal to the applicable
Overnight Rate from time to time in effect, in the applicable currency of such
recovery or payment.
10.07 SUCCESSORS AND ASSIGNS.
(a) The provisions of this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that the Borrower may not assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
each Lender and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance with the
provisions of subsection (b) of this Section, (ii) by way of participation in
accordance with the provisions of subsection (d) of this Section, or (iii) by
way of pledge or assignment of a security interest subject to the restrictions
of subsection (f) or (i) of this Section (and any other attempted assignment or
transfer by any party hereto shall be null and void). Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in subsection (d) of this Section and, to
the extent expressly contemplated hereby, the Indemnitees) any legal or
equitable right, remedy or claim under or by reason of this Agreement.
(b) Any Lender may at any time assign to one or more Eligible Assignees
all or a portion of its rights and obligations under this Agreement (including
all or a portion of its Commitment and the Loans (including for purposes of this
subsection (b), participations in L/C Obligations and in Swing Line Loans) at
the time owing to it); provided that (i) except in the case of an assignment of
the entire remaining amount of the assigning Lender's Commitment and the Loans
at the time owing to it or in the case of an assignment to a Lender or an
Affiliate of a Lender or an Approved Fund (as defined in subsection (g) of this
Section) with respect to a Lender, the aggregate amount of the Commitment (which
for this purpose includes Loans outstanding thereunder) subject to each such
assignment, determined as of the date the Assignment and Assumption with respect
to such assignment is delivered to the Administrative Agent or, if "Trade Date"
is specified in the Assignment and Assumption, as of the Trade Date,
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shall not be less than $5,000,000 unless each of the Administrative Agent and,
so long as no Event of Default has occurred and is continuing, the Borrower
otherwise consents (each such consent not to be unreasonably withheld or
delayed); (ii) each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender's rights and obligations under
this Agreement with respect to the Loans or the Commitment assigned, except that
this clause (ii) shall not apply to rights in respect of Swing Line Loans; (iii)
any assignment of a Commitment must be approved by the Administrative Agent, the
L/C Issuer and the Swing Line Lender unless the Person that is the proposed
assignee is itself a Lender (whether or not the proposed assignee would
otherwise qualify as an Eligible Assignee); and (iv) the parties to each
assignment shall execute and deliver to the Administrative Agent an Assignment
and Assumption, together with a processing and recordation fee of $3,500.
Subject to acceptance and recording thereof by the Administrative Agent pursuant
to subsection (c) of this Section, from and after the effective date specified
in each Assignment and Assumption, the Eligible Assignee thereunder shall be a
party to this Agreement and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 3.01, 3.04, 3.05, 10.04 and 10.05
with respect to facts and circumstances occurring prior to the effective date of
such assignment). Upon request, the Borrower (at its expense) shall execute and
deliver a Note to the assignee Lender and, if applicable, to the assigning
Lender, reflecting the new Commitments of such Lenders, and the assigning Lender
shall return its old Notes, if any, to the Borrower. Any assignment or transfer
by a Lender of rights or obligations under this Agreement that does not comply
with this subsection shall be treated for purposes of this Agreement as a sale
by such Lender of a participation in such rights and obligations in accordance
with subsection (d) of this Section.
(c) The Administrative Agent, acting solely for this purpose as an
agent of the Borrower, shall maintain at the Administrative Agent's Office a
copy of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amounts of the Loans and L/C Obligations owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive, and the Borrower, the Administrative Agent and
the Lenders may treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower and any Lender, at any reasonable time
and from time to time upon reasonable prior notice.
(d) Any Lender may at any time, without the consent of, or notice to,
the Borrower or the Administrative Agent, sell participations to any Person
(other than a natural person or the Borrower or any of the Borrower's Affiliates
or Subsidiaries) (each, a "Participant") in all or a portion of such Lender's
rights and/or obligations under this Agreement (including all or a portion of
its Commitment and/or the Loans (including such Lender's participations in L/C
Obligations and/or Swing Line Loans) owing to it); provided that (i) such
Lender's obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Borrower, the
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Administrative Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, waiver or other modification
described in the first proviso to Section 10.01 that directly affects such
Participant. Subject to subsection (e) of this Section, the Borrower agrees that
each Participant shall be entitled to the benefits of Sections 3.01, 3.04 and
3.05 to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to subsection (b) of this Section. To the extent permitted
by law, each Participant also shall be entitled to the benefits of Section 10.09
as though it were a Lender, provided such Participant agrees to be subject to
Section 2.13 as though it were a Lender.
(e) A Participant shall not be entitled to receive any greater payment
under Section 3.01 or 3.04 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrower's
prior written consent. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 3.01 unless the Borrower
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 10.15 as though
it were a Lender.
(f) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement (including under its Note,
if any) to secure obligations of such Lender, including any pledge or assignment
to secure obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.
(g) As used herein, the following terms have the following meanings:
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a
Lender; (c) an Approved Fund; and (d) any other Person (other than a
natural person) approved by (i) the Administrative Agent, the L/C
Issuer and the Swing Line Lender, and (ii) unless an Event of Default
has occurred and is continuing, the Borrower (each such approval not to
be unreasonably withheld or delayed); provided that notwithstanding the
foregoing, "Eligible Assignee" shall not include the Borrower or any of
the Borrower's Affiliates or Subsidiaries; and provided further, that
an Eligible Assignee shall include only a Lender, an Affiliate of a
Lender or another Person, which, through its Lending Offices, is
capable of lending the applicable Alternative Currencies to the
Borrower without the imposition of any Taxes or additional Taxes, as
the case may be.
"Fund" means any Person (other than a natural person) that is
(or will be) engaged in making, purchasing, holding or otherwise
investing in commercial loans and similar extensions of credit in the
ordinary course of its business.
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"Approved Fund" means any Fund that is administered or managed
by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender.
(h) Notwithstanding anything to the contrary contained herein, any
Lender that is a Fund may create a security interest in all or any portion of
the Loans owing to it and the Note, if any, held by it to the trustee for
holders of obligations owed, or securities issued, by such Fund as security for
such obligations or securities, provided that unless and until such trustee
actually becomes a Lender in compliance with the other provisions of this
Section 10.07, (i) no such pledge shall release the pledging Lender from any of
its obligations under the Loan Documents and (ii) such trustee shall not be
entitled to exercise any of the rights of a Lender under the Loan Documents even
though such trustee may have acquired ownership rights with respect to the
pledged interest through foreclosure or otherwise.
(i) Notwithstanding anything to the contrary contained herein, if at
any time Bank of America assigns all of its Commitment and Loans pursuant to
subsection (b) above, Bank of America may, (i) upon 30 days' notice to the
Borrower and the Lenders, resign as L/C Issuer and/or (ii) upon 30 days' notice
to the Borrower, resign as Swing Line Lender. In the event of any such
resignation as L/C Issuer or Swing Line Lender, the Borrower shall be entitled
to appoint from among the Lenders a successor L/C Issuer or Swing Line Lender
hereunder; provided, however, that no failure by the Borrower to appoint any
such successor shall affect the resignation of Bank of America as L/C Issuer or
Swing Line Lender, as the case may be. If Bank of America resigns as L/C Issuer,
it shall retain all the rights and obligations of the L/C Issuer hereunder with
respect to all Letters of Credit outstanding as of the effective date of its
resignation as L/C Issuer and all L/C Obligations with respect thereto
(including the right to require the Lenders to make Base Rate Committed Loans or
fund risk participations in Unreimbursed Amounts pursuant to Section 2.03(c)).
If Bank of America resigns as Swing Line Lender, it shall retain all the rights
of the Swing Line Lender provided for hereunder with respect to Swing Line Loans
made by it and outstanding as of the effective date of such resignation,
including the right to require the Lenders to make Base Rate Committed Loans or
fund risk participations in outstanding Swing Line Loans pursuant to Section
2.04(c).
10.08 CONFIDENTIALITY. 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 (a) to its and its Affiliates'
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential), (b) to the extent requested
by any regulatory authority (including any self-regulatory authority, such as
the National Association of Insurance Commissioners), (c) to the extent required
by applicable laws or regulations or by any subpoena or similar legal process,
(d) to any other party to this Agreement; (e) in connection with the exercise of
any remedies hereunder or under any other Loan Document or any action or
proceeding relating to this Agreement or the enforcement of rights hereunder or
thereunder, (f) subject to an agreement containing provisions substantially the
same as those of this Section, to (i) any assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights or obligations
under this Agreement or (ii) any actual or prospective counterparty (or its
advisors) to any swap or derivative transaction relating to the Borrower and its
obligations, (g)
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with the consent of the Borrower, or (h) to the extent such Information (x)
becomes publicly available other than as a result of a breach of this Section or
(y) becomes available to the Administrative Agent or any Lender on a
nonconfidential basis from a source other than the Borrower (unless such
information became available from such source in violation of a confidentiality
obligation of such source with respect to such Information, of which obligation
the Administrative Agent was aware). For the purposes of this Section,
"Information" means all information received from any Loan Party relating to any
Loan Party or any of 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 any Loan Party, provided that, in
the case of information received from a Loan Party after the date hereof, such
information is clearly identified at the time of delivery as confidential. Any
Person required to maintain the confidentiality of Information as provided in
this Section shall be considered to have complied with its obligation to do so
if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information. Notwithstanding anything herein to the contrary,
"Information" shall not include, and the Administrative Agent and each Lender
may disclose without limitation of any kind, any information with respect to the
"tax treatment" and "tax structure" (in each case, within the meaning of
Treasury Regulation Section 1.6011-4) of the transactions contemplated hereby
and all materials of any kind (including opinions or other tax analyses) that
are provided to the Administrative Agent or such Lender relating to such tax
treatment and tax structure; provided that with respect to any document or
similar item that in either case contains information concerning the tax
treatment or tax structure of the transaction as well as other information, this
sentence shall only apply to such portions of the document or similar item that
relate to the tax treatment or tax structure of the Loans, Letters of Credit and
transactions contemplated hereby.
10.09 SET-OFF. In addition to any rights and remedies of the Lenders
provided by law, upon the occurrence and during the continuance of any Event of
Default, each Lender is authorized at any time and from time to time, without
prior notice to the Borrower or any other Loan Party, any such notice being
waived by the Borrower (on its own behalf and on behalf of each Loan Party) to
the fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held by,
and other indebtedness at any time owing by, such Lender to or for the credit or
the account of the respective Loan Parties against any and all Obligations owing
to such Lender hereunder or under any other Loan Document, now or hereafter
existing, irrespective of whether or not the Administrative Agent or such Lender
shall have made demand under this Agreement or any other Loan Document and
although such Obligations may be contingent or unmatured or denominated in a
currency different from that of the applicable deposit or indebtedness. Each
Lender agrees promptly to notify the Borrower and the Administrative Agent after
any such set-off and application made by such Lender; provided, however, that
the failure to give such notice shall not affect the validity of such set-off
and application.
10.10 INTEREST RATE LIMITATION. Notwithstanding anything to the
contrary contained in any Loan Document, the interest paid or agreed to be paid
under the Loan Documents shall not exceed the maximum rate of non-usurious
interest permitted by applicable Law (the "Maximum Rate"). If the Administrative
Agent or any Lender shall receive interest in an amount that exceeds the Maximum
Rate, the excess interest shall be applied to the principal of the Loans or, if
it exceeds such unpaid principal, refunded to the Borrower. In determining
whether the
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interest contracted for, charged, or received by the Administrative Agent or a
Lender exceeds the Maximum Rate, such Person may, to the extent permitted by
applicable Law, (a) characterize any payment that is not principal as an
expense, fee, or premium rather than interest, (b) exclude voluntary prepayments
and the effects thereof, and (c) amortize, prorate, allocate, and spread in
equal or unequal parts the total amount of interest throughout the contemplated
term of the Obligations hereunder.
10.11 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
10.12 INTEGRATION. This Agreement, together with the other Loan
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 Loan Document, 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 Loan Document shall not be deemed a conflict with this
Agreement. Each Loan 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.
10.13 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made hereunder and in any other Loan 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
Administrative Agent and each Lender, regardless of any investigation made by
the Administrative Agent or any Lender or on their behalf and notwithstanding
that the Administrative Agent or any Lender may have had notice or knowledge of
any Default at the time of any Credit Extension, and shall continue in full
force and effect as long as any Loan or any other Obligation hereunder shall
remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.
10.14 SEVERABILITY. If any provision of this Agreement or the other
Loan Documents is held to be illegal, invalid or unenforceable, (a) the
legality, validity and enforceability of the remaining provisions of this
Agreement and the other Loan Documents shall not be affected or impaired thereby
and (b) the parties shall endeavor in good faith negotiations to replace the
illegal, invalid or unenforceable provisions with valid provisions the economic
effect of which comes as close as possible to that of the illegal, invalid or
unenforceable provisions. The invalidity of a provision in a particular
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
10.15 TAX FORMS. (a) (i) Each Lender that is not a "United States
person" within the meaning of Section 7701(a)(30) of the Code (a "Foreign
Lender") shall deliver to the Administrative Agent, prior to receipt of any
payment subject to withholding under the Code (or upon accepting an assignment
of an interest herein), two duly signed completed copies of either IRS Form
W-8BEN or any successor thereto (relating to such Foreign Lender and entitling
it to an exemption from, or reduction of, withholding tax on all payments to be
made to such Foreign
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Lender by the Borrower pursuant to this Agreement) or IRS Form W-8ECI or any
successor thereto (relating to all payments to be made to such Foreign Lender by
the Borrower pursuant to this Agreement) or such other evidence satisfactory to
the Borrower and the Administrative Agent that such Foreign Lender is entitled
to an exemption from, or reduction of, U.S. withholding tax, including any
exemption pursuant to Section 881(c) of the Code. Thereafter and from time to
time, each such Foreign Lender shall (A) promptly submit to the Administrative
Agent such additional duly completed and signed copies of one of such forms (or
such successor forms as shall be adopted from time to time by the relevant
United States taxing authorities) as may then be available under then current
United States laws and regulations to avoid, or such evidence as is satisfactory
to the Borrower and the Administrative Agent of any available exemption from or
reduction of, United States withholding taxes in respect of all payments to be
made to such Foreign Lender by the Borrower pursuant to this Agreement, (B)
promptly notify the Administrative Agent of any change in circumstances which
would modify or render invalid any claimed exemption or reduction, and (C) take
such steps as shall not be materially disadvantageous to it, in the reasonable
judgment of such Lender, and as may be reasonably necessary (including the
re-designation of its Lending Office) to avoid any requirement of applicable
Laws that the Borrower make any deduction or withholding for taxes from amounts
payable to such Foreign Lender.
(ii) Each Foreign Lender, to the extent it does not act or ceases to
act for its own account with respect to any portion of any sums paid or payable
to such Lender under any of the Loan Documents (for example, in the case of a
typical participation by such Lender), shall deliver to the Administrative Agent
on the date when such Foreign Lender ceases to act for its own account with
respect to any portion of any such sums paid or payable, and at such other times
as may be necessary in the determination of the Administrative Agent (in the
reasonable exercise of its discretion), (A) two duly signed completed copies of
the forms or statements required to be provided by such Lender as set forth
above, to establish the portion of any such sums paid or payable with respect to
which such Lender acts for its own account that is not subject to U.S.
withholding tax, and (B) two duly signed completed copies of IRS Form W-8IMY (or
any successor thereto), together with any information such Lender chooses to
transmit with such form, and any other certificate or statement of exemption
required under the Code, to establish that such Lender is not acting for its own
account with respect to a portion of any such sums payable to such Lender.
(iii) The Borrower shall not be required to pay any additional amount
to any Foreign Lender under Section 3.01 (A) with respect to any Taxes required
to be deducted or withheld on the basis of the information, certificates or
statements of exemption such Lender transmits with an IRS Form W-8IMY pursuant
to this Section 10.15(a) or (B) if such Lender shall have failed to satisfy the
foregoing provisions of this Section 10.15(a); provided that if such Lender
shall have satisfied the requirement of this Section 10.15(a) on the date such
Lender became a Lender or ceased to act for its own account with respect to any
payment under any of the Loan Documents, nothing in this Section 10.15(a) shall
relieve the Borrower of its obligation to pay any amounts pursuant to Section
3.01 in the event that, as a result of any change in any applicable law, treaty
or governmental rule, regulation or order, or any change in the interpretation,
administration or application thereof, such Lender is no longer properly
entitled to deliver forms, certificates or other evidence at a subsequent date
establishing the fact that such Lender or other Person for the
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account of which such Lender receives any sums payable under any of the Loan
Documents is not subject to withholding or is subject to withholding at a
reduced rate.
(iv) The Administrative Agent may, without reduction, withhold any
Taxes required to be deducted and withheld from any payment under any of the
Loan Documents with respect to which the Borrower is not required to pay
additional amounts under this Section 10.15(a).
(b) Upon the request of the Administrative Agent, each Lender that is a
"United States person" within the meaning of Section 7701(a)(30) of the Code
shall deliver to the Administrative Agent two duly signed completed copies of
IRS Form W-9. If such Lender fails to deliver such forms, then the
Administrative Agent may withhold from any interest payment to such Lender an
amount equivalent to the applicable back-up withholding tax imposed by the Code,
without reduction.
(c) If any Governmental Authority asserts that the Administrative Agent
did not properly withhold or backup withhold, as the case may be, any tax or
other amount from payments made to or for the account of any Lender, such Lender
shall indemnify the Administrative Agent therefor, including all penalties and
interest, any taxes imposed by any jurisdiction on the amounts payable to the
Administrative Agent under this Section, and costs and expenses (including
Attorney Costs) of the Administrative Agent. The obligation of the Lenders under
this Section shall survive the termination of the Aggregate Commitments,
repayment of all other Obligations hereunder and the resignation of the
Administrative Agent.
10.16 REPLACEMENT OF LENDERS. Under any circumstances set forth herein
providing that the Borrower shall have the right to replace a Lender as a party
to this Agreement, the Borrower may, upon notice to such Lender and the
Administrative Agent, replace such Lender by causing such Lender to assign its
Commitment (with the assignment fee to be paid by the Borrower in such instance)
pursuant to Section 10.07(b) to one or more other Lenders or Eligible Assignees
procured by the Borrower; provided, however, that if the Borrower elects to
exercise such right with respect to any Lender pursuant to Section 3.06(b), it
shall be obligated to replace all Lenders that have made similar requests for
compensation pursuant to Section 3.01 or 3.04. The Borrower shall (x) pay in
full all principal, interest, fees and other amounts owing to such Lender
through the date of replacement (including any amounts payable pursuant to
Section 3.05), (y) provide appropriate assurances and indemnities (which may
include letters of credit) to the L/C Issuer and the Swing Line Lender as each
may reasonably require with respect to any continuing obligation to fund
participation interests in any L/C Obligations or any Swing Line Loans then
outstanding, and (z) release such Lender from its obligations under the Loan
Documents. Any Lender being replaced shall execute and deliver an Assignment and
Assumption with respect to such Lender's Commitment and outstanding Loans and
participations in L/C Obligations and Swing Line Loans.
10.17 GOVERNING LAW.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, the LAW OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE (INCLUDING NEW YORK GENERAL OBLIGATION LAW
(ss.) 5-1401); PROVIDED THAT
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THE ADMINISTRATIVE AGENT AND EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER
FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK
SITTING IN THE BOROUGH OF MANHATTAN, NEW YORK OR OF THE UNITED STATES DISTRICT
COURTS OF SUCH STATE SITTING IN THE BOROUGH OF MANHATTAN, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH
LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH
LENDER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING
OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION
IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT RELATED THERETO. THE BORROWER,
THE ADMINISTRATIVE AGENT AND EACH LENDER WAIVES PERSONAL SERVICE OF ANY SUMMONS,
COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY
THE LAW OF SUCH STATE.
10.18 WAIVER OF RIGHT TO TRIAL BY JURY. 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 LOAN 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 LOAN 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.
10.19 JUDGEMENT CURRENCY. If, for the purposes of obtaining judgment in
any court, it is necessary to convert a sum due hereunder or any other Loan
Document in one currency into another currency, the rate of exchange used shall
be that at which in accordance with normal banking procedures the Administrative
Agent could purchase the first currency with such other currency on the Business
Day preceding that on which final judgment is given. The obligation of the
Borrower in respect of any such sum due from it to the Administrative Agent or
the Lenders hereunder or under the other Loan Documents shall, notwithstanding
any judgment in a currency (the "Judgment Currency") other than that in which
such sum is denominated in accordance with the applicable provisions of this
Agreement (the "Agreement Currency"), be discharged only to the extent that on
the Business Day following receipt by the Administrative Agent of any sum
adjudged to be so due in the Judgment Currency, the Administrative Agent may in
accordance with normal banking procedures purchase the Agreement Currency with
the
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Judgment Currency. If the amount of the Agreement Currency so purchased is less
than the sum originally due to the Administrative Agent from the Borrower in the
Agreement Currency, the Borrower agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify the Administrative Agent or the
Person to whom such obligation was owing against such loss. If the amount of the
Agreement Currency so purchased is greater than the sum originally due to the
Administrative Agent in such currency, the Administrative Agent agrees to return
the amount of any excess to the Borrower (or to any other Person who may be
entitled thereto under applicable law).
10.20 CONTINUITY OF CONTRACT. The parties hereto agree that the
occurrence or non-occurrence of EMU, any event or events associated with EMU
and/or the introduction of the Euro in all or any part of the European Union (a)
will not result in the discharge, cancellation, rescission or termination in
whole or in part of this Agreement or any other Loan Document, (b) will not give
any party the right to cancel, rescind, terminate or vary this Agreement or any
other Loan Document or (c) will not give rise to an Event of Default, in each
case other than as specifically provided in this Agreement.
10.21 ENTIRE AGREEMENT. This Agreement and the other Loan Documents
represent the final agreement among the parties and may not be contradicted by
evidence of prior, contemporaneous, or subsequent oral agreements of the
parties. There are no unwritten oral agreements among the parties.
[Signature Pages Follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
ARMOR HOLDINGS, INC.
By:
------------------------------------
Name:
Title:
BANK OF AMERICA, N.A.,
as Administrative Agent
By:
------------------------------------
Name: Michael Brashler
Title: Vice President and Senior Agency
Officer
BANK OF AMERICA, N.A., as L/C Issuer, Swing
Line Lender and a Lender
By:
------------------------------------
Name: Brian Keeney
Title: Senior Vice President
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Syndication Agent and a Lender
By:
------------------------------------
Name:
Title:
KEYBANK NATIONAL ASSOCIATION, as
Documentation Agent and a Lender
By:
------------------------------------
Name:
Title: