EXHIBIT 10.1
FINANCING AGREEMENT
Financing Agreement, dated as of February 25, 2002, by and among Allied
Holdings, Inc., a Georgia corporation (the "Parent"), and Allied Systems, Ltd.
(L.P.), a Georgia limited partnership ("Allied Systems" and together with the
Parent, each a "Borrower" and collectively, the "Borrowers"), each subsidiary of
the Parent listed as a "Guarantor" on the signature pages hereto (each a
"Guarantor" and collectively, the "Guarantors"), each of the lenders from time
to time party hereto as a Senior Lender (each a "Senior Lender" and
collectively, the "Senior Lenders"), each of the lenders from time to time party
hereto as a Subordinated Term Loan D Lender (each a "Subordinated Term Loan D
Lender" and collectively, the "Subordinated Term Loan D Lenders" and, together
with the Senior Lenders, each a "Lender" and collectively, the "Lenders"),
Ableco Finance LLC, a Delaware limited liability company ("Ableco"), as
collateral agent for the Lenders (in such capacity, the "Collateral Agent"), and
Foothill Capital Corporation, a California corporation ("Foothill"), as
administrative agent for the Senior Lenders (in such capacity, the
"Administrative Agent" and together with the Collateral Agent, each an "Agent"
and collectively, the "Agents").
RECITALS
The Borrowers have asked the Lenders to extend credit to the Borrowers
consisting of (i) four separate term loans consisting of (A) a $17,500,000
senior term loan A made by certain of the Senior Lenders, (B) a $25,000,000
senior term loan B made by certain of the Senior Lenders, (C) a $11,000,000
senior term loan C made by certain of the Senior Lenders, and (D) a $29,250,000
subordinated term loan D made by the Subordinated Term Loan D Lenders and (ii) a
revolving credit facility in an aggregate principal amount not to exceed
$120,000,000 at any time outstanding made by certain of the Senior Lenders,
which will include a subfacility for the issuance of letters of credit. The
proceeds of the Senior Loans (as hereafter defined) made by the Senior Lenders
shall be used to refinance certain existing indebtedness of the Borrowers, to
repay a portion of the Subordinated Notes (as hereafter defined), for general
working capital purposes of the Borrowers and the other Loan Parties and to pay
fees and expenses related to this Agreement. The Subordinated Term Loan D shall
be made as partial consideration for the purchase of the Subordinated Notes. The
letters of credit will be used for general working capital purposes and to
support the Canadian Facility (as hereinafter defined) and certain cash
management arrangements. The Lenders are severally, and not jointly, willing to
extend such credit to the Borrowers subject to the terms and conditions
hereinafter set forth.
In consideration of the premises and the covenants and agreements
contained herein, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS; CERTAIN TERMS
Section 1.01 Definitions. As used in this Agreement, the following
terms shall have the respective meanings indicated below, such meanings to be
applicable equally to both the singular and plural forms of such terms:
"Ableco" has the meaning specified therefor in the preamble hereto.
"Account Debtor" means each debtor, customer or obligor in any way
obligated on or in connection with any Account Receivable.
"Account Receivable" means, with respect to any Person, any and all
rights of such Person to payment for goods sold and/or services rendered,
including accounts, general intangibles and any and all such rights evidenced by
chattel paper, instruments or documents, whether due or to become due and
whether or not earned by performance, and whether now or hereafter acquired or
arising in the future, and any proceeds arising therefrom or relating thereto.
"Action" has the meaning specified therefor in Section 12.12.
"Administrative Agent" has the meaning specified therefor in the
preamble hereto.
"Administrative Agent's Account" means an account at a bank designated
by the Administrative Agent from time to time as the account into which the
Borrowers shall make all payments to the Administrative Agent for the benefit of
the Agents and the Senior Lenders under this Agreement and the other Loan
Documents.
"Administrative Borrower" has the meaning specified therefor in Section
12.16.
"Affiliate" means, with respect to any Person, any other Person that
directly or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such Person. For purposes of
this definition, "control" of a Person means the power, directly or indirectly,
either to (i) vote 10% or more (or in the case of any Account Debtor, 49% or
more) of the Capital Stock having ordinary voting power for the election of
directors of such Person or (ii) direct or cause the direction of the management
and policies of such Person whether by contract or otherwise. Notwithstanding
anything herein to the contrary, in no event shall any Agent or any Lender be
considered an "Affiliate" of any Loan Party.
"Agent" has the meaning specified therefor in the preamble hereto.
"Agent Advances" has the meaning specified therefor in Section
10.08(a).
"Agreement" means this Financing Agreement, including all amendments,
modifications and supplements and any exhibits or schedules to any of the
foregoing, and shall refer to the Agreement as the same may be in effect at the
time such reference becomes operative.
"AH Industries" means AH Industries Inc., a Canadian company.
"Allied Canada" means Allied Systems (Canada) Company, a Canadian
company.
"Allied Systems" has the meaning specified therefor in the preamble
hereto.
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"Assignment and Acceptance" means an assignment and acceptance entered
into by an assigning Senior Lender and an assignee, and accepted by the
Collateral Agent, in accordance with Section 12.07 hereof and substantially in
the form of Exhibit G hereto or such other form acceptable to the Collateral
Agent.
"Authorized Officer" means any officer or other employee of a Borrower.
"Availability" means, at any time, the difference between (i) the
lesser of (A) the Borrowing Base and (B) the Total Revolving Credit Commitment
and (ii) the sum of (A) the aggregate outstanding principal amount of all
Revolving Loans and (B) all Letter of Credit Obligations.
"Availability Deficiency" has the meaning specified therefor in Section
2.05(c)(iv).
"Axis Entity" means Axis Group, Inc., a Georgia corporation and
wholly-owned Subsidiary of the Parent, and each of its Subsidiaries.
"Axis Netherlands L/C" means the standby letter of credit in the stated
amount of approximately $912,000 issued for the account of Axis Netherlands,
C.V. and secured by cash collateral in an amount of approximately $930,000.
"Bankruptcy Code" means the United States Bankruptcy Code (11
U.S.C.ss.101, et seq.), as amended, and any successor statute.
"Board" means the Board of Governors of the Federal Reserve System of
the United States.
"Borrower" has the meaning specified therefor in the preamble hereto.
"Borrowing Base" means, at any time, the difference between (i) the sum
of (A) the lesser of (x) 80% of the value of the Net Amount of Eligible Accounts
Receivable of the Designated Loan Parties (excluding any Axis Entity) at such
time less the amount, if any, of the Dilution Reserve and (y) an amount equal to
the Collections of the Designated Loan Parties (excluding any Axis Entity) with
respect to their Accounts Receivable for the immediately preceding 30 day period
plus (B) 70% of the difference between (x) the Gross Orderly Liquidation Value
of the Eligible Rolling Stock of the Designated Loan Parties (excluding any Axis
Entity) at such time and (y) the Rolling Stock Depreciation Amount at such time
and (ii) the sum of (A) $15,000,000 and (B) such reserves as the Administrative
Agent may deem appropriate in the exercise of its reasonable business judgment
based upon the lending practices of the Administrative Agent as a secured
asset-based lender, including, without limitation, any reserve that may be
required to be established pursuant to Section 2.05(c)(iv) arising from an
Availability Deficiency, reserves with respect to sales or other dispositions of
Eligible Rolling Stock and reserves with respect to any goods and services tax
applicable in Canada. For purposes of determining the Borrowing Base, amounts in
Canadian Dollars shall be valued at the Dollar Equivalent.
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"Borrowing Base Certificate" means a certificate signed by an
Authorized Officer of the Administrative Borrower and setting forth the
calculation of the Borrowing Base in compliance with Section 7.01(a)(vi),
substantially in the form of Exhibit E.
"Business Day" means any day other than a Saturday, Sunday or other day
on which commercial banks in New York City are authorized or required to close,
provided that, with respect to the borrowing, payment or continuation of, or
determination of interest rate on, LIBOR Rate Loans, Business Day shall mean any
Business Day which dealings in Dollars may be carried on in the interbank
eurodollar markets in New York City and London.
"Canadian Dollars" means the lawful money of Canada.
"Canadian Entities" means the Canadian Loan Parties and the other
Subsidiaries of the Parent organized in Canada other than AH Industries.
"Canadian Facility" means an unsecured working capital credit facility
provided by the Canadian Facility Lender in favor of Allied Canada and its
Subsidiaries in an amount not to exceed the Canadian Dollar equivalent of
$2,500,000 which facility and the obligations thereunder will be supported by
the Canadian Facility L/C issued in favor of the Canadian Facility Lender.
"Canadian Facility L/C" means one or more standby Letters of Credit in
an aggregate stated amount not exceeding $2,600,000 issued in favor of the
Canadian Facility Lender in connection with the Canadian Facility.
"Canadian Facility Lender" means The Bank of Nova Scotia or any other
lender reasonably acceptable to the Agents.
"Canadian Loan Party" means each of Allied Canada, Axis Canada Company
and each other Subsidiary of the Parent organized in Canada that is a Loan
Party.
"Canadian MEPP" means the Eastern Canada Car Carriers Pension Plan.
"Canadian Mortgage" means each Mortgage made by a Loan Party with
respect to a Facility located in Canada.
"Canadian Plans" means, with respect to employees of the Canadian
Entities, plans, arrangements, agreements, programs, policies, practices or
undertakings, whether oral or written, formal or informal, funded or funded,
insured or uninsured, registered or unregistered to which the Canadian Entities
are a party or by which the Canadian Entities are bound or under which the
Canadian Entities have, or will have, any liability or contingent liability,
relating to pensions, retirement or retirement savings, disability or wage or
benefits continuation during periods of absence from work (including long-term
disability), healthcare or dental treatments or expenses, life insurance,
dependent life insurance, accidental death and dismemberment insurance, bonuses,
incentive pay or compensation, performance compensation, deferred compensation,
profit sharing, share purchases, share options, stock appreciation, phantom
stock, vacation or vacation pay, sick pay, severance or termination pay,
employee loans or separation from service benefits, or any other type of
arrangement providing for compensation or benefits
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additional to base pay or salary; provided, that Canadian Plans shall not
include the Canadian MEPP.
"Canadian Security Agreements" means each of the agreements, documents
and instruments set forth in Schedule 1.01(E).
"Canadian Security Documents" means the Canadian Security Agreement and
each Canadian Mortgage.
"Capital Expenditures" means, with respect to any Person for any
period, the aggregate of all expenditures by such Person and its Subsidiaries
during such period that in accordance with GAAP are or should be included in
"property, plant and equipment" or in a similar fixed asset account on its
balance sheet, whether such expenditures are paid in cash or financed and
including all Capitalized Lease Obligations paid or payable during such period.
"Capital Guideline" means any law, rule, regulation, policy, guideline
or directive (whether or not having the force of law and whether or not the
failure to comply therewith would be unlawful) of any central bank or
Governmental Authority (i) regarding capital adequacy, capital ratios, capital
requirements, the calculation of a bank's capital or similar matters, or (ii)
affecting the amount of capital required to be obtained or maintained by any
Lender, any Person controlling any Lender, or the L/C Issuer or the manner in
which any Lender, any Person controlling any Lender, or the L/C Issuer allocates
capital to any of its contingent liabilities (including letters of credit),
advances, acceptances, commitments, assets or liabilities.
"Capital Stock" means (i) with respect to any Person that is a
corporation, any and all shares, interests, participations or other equivalents
(however designated and whether or not voting) of corporate stock, and (ii) with
respect to any Person that is not a corporation, any and all partnership,
membership or other equity interests of such Person.
"Capitalized Lease" means, with respect to any Person, any lease of
real or personal property by such Person as lessee which is (i) required under
GAAP to be capitalized on the balance sheet of such Person or (ii) a transaction
of the type commonly known as a "synthetic lease" (i.e., a lease transaction
that is treated as an operating lease for accounting purposes but with respect
to which the payments of rent are intended to be treated as payments of
principal and interest on a loan for Federal income tax purposes).
"Capitalized Lease Obligations" means, with respect to any Person,
obligations of such Person under Capitalized Leases, and, for purposes hereof
the amount of any such obligation shall be (i) in the case of a lease required
to be capitalized on the balance sheet of such Person, the capitalized amount
thereof determined in accordance with GAAP and (ii) otherwise, the amount such
Person would be required to pay under such lease if it elected to terminate such
lease (or, if such Person is not permitted to terminate such lease, the amount
the lessor would be entitled to receive in accordance with such lease if all the
property subject to such lease were destroyed).
"Cash and Cash Equivalents" means all cash and any presently existing
or hereafter arising deposit account balances, certificates of deposit or other
financial instruments properly classified as cash equivalents under GAAP.
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"Cash Management Bank L/C" means the standby Letter of Credit in the
stated amount not exceeding $5,000,000 issued in favor of Fleet National Bank on
the Effective Date or, thereafter, any standby Letter of Credit issued in favor
of another commercial bank that maintains the Operating Accounts of the
Borrowers and the domestic Guarantors.
"Change of Control" means each occurrence of any of the following:
(a) the acquisition, directly or indirectly, by any person or
group (within the meaning of Section 13(d)(3) of the Exchange Act) other than a
Permitted Holder of beneficial ownership of more than 33% of the aggregate
outstanding voting power of the Capital Stock of the Parent;
(b) during any period of two consecutive years, individuals who at
the beginning of such period constituted the Board of Directors of the Parent
(together with any new directors whose election by such Board of Directors or
whose nomination for election by the shareholders of the Parent was approved by
a vote of at least a majority the directors of the Parent then still in office
who were either directors at the beginning of such period, or whose election or
nomination for election was previously approved) cease for any reason to
constitute a majority of the Board of Directors of the Parent;
(c) the Parent shall cease, directly or indirectly, to have
beneficial ownership (as defined in Rule 13d-3 under the Exchange Act) of 100%
of the aggregate voting power of the Capital Stock of each other Designated Loan
Party (other than any Axis Entity), free and clear of all Liens (other than any
Liens granted hereunder or any Permitted Lien that is an inchoate Lien securing
obligations for the payment of money not overdue or otherwise payable);
(d) except to the extent permitted pursuant to Section 7.02(c)(i),
(i) any Designated Loan Party (other than any Axis Entity) consolidates with or
merges into another entity or conveys, transfers or leases all or substantially
all of its property and assets to another Person, or (ii) any entity
consolidates with or merges into any Designated Loan Party (other than any Axis
Entity) in a transaction pursuant to which the outstanding voting Capital Stock
of such Designated Loan Party (other than any Axis Entity) is reclassified or
changed into or exchanged for cash, securities or other property, other than any
such transaction described in this clause (ii) in which either (A) in the case
of any such transaction involving the Parent, no person or group (within the
meaning of Section 13(d)(3) of the Exchange Act) other than a Permitted Holder
has, directly or indirectly, acquired beneficial ownership of more than 33% of
the aggregate outstanding voting Capital Stock of the Parent or (B) in the case
of any such transaction involving a Designated Loan Party other than the Parent
or any Axis Entity, the Parent, directly or indirectly, has beneficial ownership
of 100% of the aggregate voting power of all Capital Stock of the resulting,
surviving or transferee entity;
(e) Hugh E. Sawyer shall cease to be involved in the day to day
operations and management of the business of the Parent, and a successor
reasonably acceptable to the Agents is not appointed on terms reasonably
acceptable to the Agents within 90 days of such cessation of involvement; or
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(f) a "Change of Control" as defined in Annex 4 or in the
Indenture shall have occurred or a notice of a "Change of Control Offer" under
and as defined in the Indenture or a "Control Change Notice" under and as
defined in Annex 5 shall have been given.
"Collateral" means all of the property and assets and all interests
therein and proceeds thereof now owned or hereafter acquired by any Person upon
which a Lien is granted or purported to be granted by such Person as security
for all or any part of the Obligations.
"Collateral Agent" has the meaning specified therefor in the preamble
hereto.
"Collection Account" and "Collection Accounts" have the meanings
specified therefor in Section 8.01(a).
"Collections" means all cash, checks, notes, instruments and any other
items of payment (including, without limitation, insurance proceeds, proceeds of
cash sales, rental proceeds and tax refunds) of the Loan Parties.
"Collective Bargaining Agreements" means, collective bargaining
agreements and related documents including benefit agreements, letters of
understanding, letters of intent and other written communications with
bargaining agents or trade unions by which any Loan Party or any Canadian Entity
is bound or which impose any obligation upon any Loan Party or any Canadian
Entity or set out the understanding of the parties with respect to the meaning
of any provisions of such collective bargaining agreements.
"Commitments" means, with respect to each Lender, such Lender's
Revolving Credit Commitment, Term Loan A Commitment, Term Loan B Commitment,
Term Loan C Commitment and Subordinated Term Loan D Commitment.
"Consolidated EBITDA" means, with respect to any Person for any period,
the Consolidated Net Income of such Person and its Subsidiaries for such period,
plus (i) without duplication, the sum of the following amounts of such Person
and its Subsidiaries for such period and to the extent deducted in determining
Consolidated Net Income of such Person for such period: (A) Consolidated Net
Interest Expense, (B) income tax expense, (C) depreciation expense and (D)
amortization expense.
"Consolidated Net Income" means, with respect to any Person for any
period, the net income (loss) of such Person and its Subsidiaries for such
period, determined on a consolidated basis and in accordance with GAAP, but
excluding from the determination of Consolidated Net Income (without
duplication) (a) any extraordinary or non recurring gains or losses or gains or
losses from Dispositions, (b) restructuring charges, (c) effects of discontinued
operations, (d) non-cash expenses resulting from the grant of equity
compensation to its employees, (e) any non-cash income or loss attributable to
any intercompany foreign currency transactions, and (f) any non-cash income or
loss attributable to any joint venture of any Person.
"Consolidated Net Interest Expense" means, with respect to any Person
for any period, gross interest expense of such Person and its Subsidiaries for
such period determined on a consolidated basis and in accordance with GAAP
(including, without limitation, interest expense paid to Affiliates of such
Person), less (i) the sum of (A) interest income for such period and (B)
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gains for such period on Hedging Agreements (to the extent not included in
interest income above and to the extent not deducted in the calculation of gross
interest expense), plus (ii) the sum of (A) losses for such period on Hedging
Agreements (to the extent not included in gross interest expense) and (B) the
upfront costs or fees for such period associated with Hedging Agreements (to the
extent not included in gross interest expense), in each case, determined on a
consolidated basis and in accordance with GAAP.
"Contingent Obligation" means, with respect to any Person, any
obligation of such Person guaranteeing or intended to guarantee any
Indebtedness, leases, dividends or other obligations ("primary obligations") of
any other Person (the "primary obligor") in any manner, whether directly or
indirectly, including, without limitation, (i) the direct or indirect guaranty,
endorsement (other than for collection or deposit in the ordinary course of
business), co-making, discounting with recourse or sale with recourse by such
Person of the obligation of a primary obligor, (ii) the obligation to make
take-or-pay or similar payments, if required, regardless of nonperformance by
any other party or parties to an agreement, (iii) any obligation of such Person,
whether or not contingent, (A) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (B) to advance or
supply funds (1) for the purchase or payment of any such primary obligation or
(2) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (C) to
purchase property, assets, securities or services primarily for the purpose of
assuring the owner of any such primary obligation of the ability of the primary
obligor to make payment of such primary obligation or (D) otherwise to assure or
hold harmless the holder of such primary obligation against loss in respect
thereof; provided, however, that the term "Contingent Obligation" shall not
include (x) any product warranties extended in the ordinary course of business
or (y) customary indemnification agreement entered into as a part of the sale of
any assets or Capital Stock permitted by this Agreement. The amount of any
Contingent Obligation shall be deemed to be an amount equal to the stated or
determinable amount of the primary obligation with respect to which such
Contingent Obligation is made (or, if less, the maximum amount of such primary
obligation for which such Person may be liable pursuant to the terms of the
instrument evidencing such Contingent Obligation) or, if not stated or
determinable, the maximum reasonably anticipated liability with respect thereto
(assuming such Person is required to perform thereunder), as determined by such
Person in good faith.
"Contribution Agreement" means the Contribution Agreement, dated as of
the Effective Date, duly executed by each Loan Party, substantially in the form
of Exhibit I.
"Custodian Agreement" means the Custodian Agreement, dated as of the
Effective Date, duly executed by each Loan Party, the Rolling Stock Collateral
Custodian and the Collateral Agent, substantially in the form of Exhibit J.
"Default" means an event which, with the giving of notice or the lapse
of time or both, would constitute an Event of Default.
"Defaulting Lender" has the meaning specified therefor in Section
12.20.
"Depository Accounts" means the depository accounts in the name of the
Administrative Agent for the collection of the Accounts Receivable of the Loan
Parties (other
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than the Canadian Loan Parties) and the proceeds of any Collateral of the Loan
Parties (other than the Canadian Loan Parties) pursuant to the arrangements
acceptable to the Administrative Agent.
"Designated Loan Parties" means (i) the Borrowers, (ii) Allied Canada,
(iii) each Subsidiary of the Parent set forth on Schedule 1.01(B), and (iv) any
other domestic or Canadian Subsidiary of the Parent with gross annual revenues
(based upon the most recent annual financial statements of the Parent delivered
pursuant to Section 7.01(a)(ii)) or total assets with a book value (based upon
the most recent quarterly financial statements of the Parent delivered pursuant
to Section 7.01(a)(i)) equal to or greater than $5,000,000 (or in the case of a
Canadian Entity, the Dollar Equivalent thereof) that the Agents designate as a
"Designated Loan Party"; provided, however, that in no event shall Haul
Insurance or AH Industries be a Designated Loan Party.
"Dilution" means, as of any date of determination, a percentage, based
upon the experience of the immediately prior 90 days, that is the result of
dividing the Dollar amount of (i) bad debt write-downs, discounts, advertising
allowances, credits, or other dilutive items with respect to the Designated Loan
Parties' Accounts Receivable during such period, provided, that there shall be
excluded from this clause (i) the amount of all write-offs of overdue Accounts
Receivable set forth on Schedule 1.01(D) made on or prior to June 30, 2002, by
(ii) the Designated Loan Parties' Accounts Receivable that were created and
billed during such period.
"Dilution Reserve" means, as of any date of determination, an amount
sufficient to reduce the advance rate against Eligible Accounts Receivable by
one percentage point for each percentage point by which Dilution is in excess of
7.0%.
"Disposition" means any transaction, or series of related transactions,
pursuant to which any Person or any of its Subsidiaries sells, assigns,
transfers or otherwise disposes of any property or assets (whether now owned or
hereafter acquired) to any other Person, in each case, whether or not the
consideration therefor consists of cash, securities or other assets owned by the
acquiring Person.
"Dollar," "Dollars" and the symbol "$" each means lawful money of the
United States of America.
"Dollar Equivalent" means, with respect to an amount of Canadian
Dollars on any date, the amount of Dollars that may be purchased with such
amount of Canadian Dollars at the Exchange Rate applicable to Canadian Dollars
on such date.
"Effective Date" means the date, on or before February 28, 2002, on
which all of the conditions precedent set forth in Section 5.01 and Section 5.03
are satisfied or waived and the initial Loans are made.
"Eligible Accounts Receivable" means the Accounts Receivable of each of
the Designated Loan Parties (other than any Axis Entity) which are, and at all
times continue to be, acceptable to the Administrative Agent in the exercise of
its reasonable business judgment. In general, an Account Receivable may, in the
reasonable business judgment of the Administrative Agent, based upon its lending
practices as a secured asset-based lender, be deemed to be eligible if: (i)
delivery of the merchandise or the rendition of the services has been completed
with
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respect to such Account Receivable; (ii) no return, rejection, repossession or
dispute has occurred with respect to such Account Receivable, the Account Debtor
has not asserted any setoff, defense or counterclaim with respect to such
Account Receivable, and there has not occurred any extension of the time for
payment with respect to such Account Receivable without the consent of the
Administrative Agent, provided that, in the case of any dispute, setoff, defense
or counterclaim with respect to an Account Receivable, the portion of such
Account Receivable not subject to such dispute, setoff, defense or counterclaim
will not be ineligible solely by reason of this clause (ii); (iii) such Account
Receivable is lawfully owned by a Designated Loan Party (other than any Axis
Entity) free and clear of any Lien other than in favor of the Collateral Agent
for the benefit of the Lenders or any Permitted Lien that is an inchoate Lien
securing obligations for the payment of money not overdue or otherwise payable
and otherwise continues to be in full conformity with all representations and
warranties made by a Designated Loan Party (other than any Axis Entity) to the
Agents and the Senior Lenders with respect thereto in the Loan Documents; (iv)
such Account Receivable is unconditionally payable in Dollars or in Canadian
Dollars within 90 days from the invoice date and is not evidenced by a
promissory note, chattel paper or any other instrument or other document; (v) no
more than 60 days have elapsed from the invoice due date and no more than 90
days have elapsed from the invoice date with respect to such Account Receivable;
(vi) such Account Receivable is not due from an Affiliate of a Loan Party; (vii)
such Account Receivable does not constitute an obligation of the United States
or Canada or any other Governmental Authority (unless all steps required by the
Administrative Agent in connection therewith, including notice to the United
States Government under the Federal Assignment of Claims Act or any action under
any state or Canadian statute comparable to the Federal Assignment of Claims
Act, have been duly taken in a manner satisfactory to the Administrative Agent);
(viii) the Account Debtor (or the applicable office of the Account Debtor) with
respect to such Account Receivable is located in the continental United States
or Canada, unless such Account Receivable is supported by a letter of credit or
other similar obligation satisfactory to the Administrative Agent; (ix) the
Account Debtor with respect to such Account Receivable is not also a supplier to
or creditor of a Loan Party, unless such Account Debtor has executed a no-offset
letter satisfactory to the Administrative Agent, provided that the portion of
such Account Receivable in excess of amounts owing to such supplier or creditor
will not be ineligible solely by reason of this clause (ix); (x) not more than
50% of the aggregate amount of all Accounts Receivable of the Account Debtor
with respect to such Account Receivable have remained unpaid 60 days past the
invoice due date or 90 days past the invoice date, provided, that, prior to June
30, 2002, Accounts Receivable of General Motors Corporation and its Affiliates
shall not be excluded solely by reason of this clause (x); (xi) the Account
Debtor with respect to such Account Receivable (A) has not filed a petition for
bankruptcy or any other relief under the Bankruptcy Code, the Bankruptcy and
Insolvency Act (Canada), the Companies Creditors Arrangement Act (Canada) or any
other law relating to bankruptcy, insolvency, reorganization or relief of
debtors, made an assignment for the benefit of creditors, had filed against it
any petition or other application for relief under the Bankruptcy Code, the
Bankruptcy and Insolvency Act (Canada), the Companies Creditors Arrangement Act
(Canada) or any such other law, (B) has not failed, suspended business
operations generally, become insolvent or called a meeting of its creditors for
the purpose of obtaining any financial concession or accommodation, (C) has not
had or suffered to be appointed a receiver or a trustee for all or a significant
portion of its assets or affairs or (D) in the case of an Account Debtor who is
an individual, is not an employee of a Designated Loan Party or any of its
Affiliates and has
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not died or been declared incompetent; (xii) the otherwise Eligible Accounts
Receivable of any Account Debtor does not exceed (A) with respect to any Account
Debtor or its Affiliates (other than a Significant Customer or American Honda
Motor Co., Inc. and its Affiliates), 10% of all Eligible Accounts Receivable,
(B) with respect to any two Significant Customers, 30% of all Eligible Accounts
Receivable and, with respect to the other remaining Significant Customer, 40% of
all Eligible Accounts Receivable, (C) with respect to the aggregate amount of
otherwise Eligible Accounts Receivable from all Significant Customers, 80% of
all Eligible Accounts Receivable, and (D) with respect to American Honda Motor
Co., Inc. and its Affiliates, 12% of all Eligible Accounts Receivable, provided,
that such percentages as applied to a particular Account Debtor and its
Affiliates are subject to reduction by the Administrative Agent in its
reasonable business judgment (based upon its lending practices as a secured
asset-based lender) if the creditworthiness of such Account Debtor deteriorates;
and (xiii) the Administrative Agent is, and continues to be, satisfied with the
credit standing of the Account Debtor in relation to the amount of credit
extended and the Administrative Agent believes, in its reasonable business
judgment (based upon its lending practices as a secured asset-based lender),
that the prospect of collection of such Account Receivable is not impaired for
any reason.
"Eligible Rolling Stock" means all Rolling Stock of each of the
Designated Loan Parties (other than the Axis Group), that meets all of the
following specifications: (i) such Rolling Stock is lawfully owned by a
Designated Loan Party (other than any Axis Entity) and evidenced by a
certificate of title or other similar instrument filed in the name of a
Designated Loan Party (other than any Axis Entity) and is properly registered in
one of the states of the United States or in Canada to such Designated Loan
Party; (ii) such Rolling Stock is free and clear of any existing Lien other than
a Lien in favor of the Collateral Agent for the benefit of the Lenders, which
Lien shall be a perfected, first priority Lien or any Permitted Lien that is an
inchoate Lien securing obligations for the payment of money not overdue or
otherwise payable; (iii) such Rolling Stock otherwise continues to be in full
conformity with all representations and warranties made by a Designated Loan
Party to the Agents and the Senior Lenders with respect thereto in the Loan
Documents; (iv) a Designated Loan Party has the right to grant Liens on such
Rolling Stock; (v) such Rolling Stock is in good working order, condition and
repair (ordinary wear and tear excepted) and is used or usable in the ordinary
course of the business of a Designated Loan Party (other than any Axis Entity),
and is not obsolete, damaged, defective or otherwise unusable or unsuitable as
Collateral for the Obligations; (vi) such Rolling Stock, when it is not in
transit within the continental United States or Canada in the ordinary course of
business, is based at one of the locations in one of the continental United
States or Canada listed on Schedule 6.01(cc) or such other locations in the
continental United States or Canada, as the Collateral Agent may approve in
writing from time to time and, when such Rolling Stock is in transit, it is in
transit within the continental United States or Canada; (vii) such Rolling Stock
has not been purchased or otherwise acquired by any Designated Loan Party after
the latest appraisal of the Rolling Stock conducted by the Agents pursuant to
Section 7.01(f)(ii); (viii) such Rolling Stock meets, in all material respects,
all applicable standards of all Motor Vehicle Laws or otherwise established by
any Governmental Authority and is not subject to any licensing or similar
requirement that would limit the right of the Collateral Agent to sell or
otherwise dispose of such Rolling Stock; (ix) the Agents shall be satisfied, in
their reasonable business judgment, that the Collateral Agent has the right to
dispose of such Rolling Stock during the continuance of an Event of Default or
the Agents shall otherwise be satisfied, in their reasonable business judgment,
that the Collateral Agent has sufficient rights to realize upon such Rolling
Stock
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during the continuance of an Event of Default; (x) such Rolling Stock is (A) a
specialized truck, tractor or trailer used to transport new or used automobiles
and light trucks or (B) a service vehicle used by any Designated Loan Party in
its ordinary course of business; provided that the Gross Orderly Liquidation
Value attributable to all such service vehicles shall not exceed $500,000; (xi)
such Rolling Stock was included in the most recent appraisal conducted by the
Agents pursuant to Section 7.01(f)(ii), which appraisal shall be based upon the
Gross Orderly Liquidation Value of such Rolling Stock, shall be in form and
substance and from an independent third party appraiser, in each case,
acceptable to the Agents in their reasonable business judgment; (xii) such
Rolling Stock is covered by an insurance policy of the applicable Designated
Loan Party in such amounts as are acceptable to the Agents, which insurance
policy provides that the Collateral Agent is the loss payee, in the case of a
casualty or other loss; and (xiii) such Rolling Stock is and at all times shall
otherwise continue to be acceptable to the Agents in their reasonable business
judgment (based upon their lending practices as secured asset-based lenders).
"Employee Plan" means an employee benefit plan (other than a
Multiemployer Plan) covered by Title IV of ERISA and maintained (or was
maintained at any time during the six (6) calendar years preceding the date of
any borrowing hereunder) for employees of any Loan Party or any of its ERISA
Affiliates.
"Environmental Actions" means any complaint, summons, citation, notice,
directive, order, claim, litigation, investigation, judicial or administrative
proceeding, judgment, letter or other communication from any Person or
Governmental Authority involving violations of Environmental Laws or Releases of
Hazardous Materials (i) from any assets, properties or businesses owned or
operated by any Loan Party or any of its Subsidiaries or any predecessor in
interest; (ii) from adjoining properties or businesses; or (iii) onto any
facilities which received Hazardous Materials generated by any Loan Party or any
of its Subsidiaries or any predecessor in interest.
"Environmental Laws" means the Comprehensive Environmental Response,
Compensation and Liability Act (42 U.S.C.ss.9601, et seq.), the Hazardous
Materials Transportation Act (49 U.S.C.ss.1801, et seq.), the Resource
Conservation and Recovery Act (42 U.S.C.ss.6901, et seq.), the Federal Clean
Water Act (33 U.S.C.ss.1251 et seq.), the Clean Air Act (42 U.S.C.ss.7401 et
seq.), the Toxic Substances Control Act (15 U.S.C.ss.2601 et seq.) and the
Occupational Safety and Health Act (29 U.S.C.ss.651 et seq.), as such laws may
be amended or otherwise modified from time to time, and any other applicable and
present or future federal, state, local or foreign (including, without
limitation, the federal government or any province of Canada) statute,
ordinance, rule, regulation, order, judgment, decree, policy, guideline, permit,
license or other binding determination of any Governmental Authority imposing
liability or establishing standards of conduct for protection of the
environment.
"Environmental Liabilities and Costs" means all liabilities, monetary
obligations, Remedial Actions, losses, damages, punitive damages, consequential
damages, treble damages, costs and expenses (including all reasonable fees,
disbursements and expenses of counsel, experts and consultants and costs of
investigations and feasibility studies), fines, penalties, sanctions and
interest incurred as a result of any claim or demand by any Governmental
Authority or any third party, and which relate to any environmental condition
at, or a Release of
-12-
Hazardous Materials from or onto (i) any property during the period such
property is or was owned or operated by any Loan Party or any of its
Subsidiaries or (ii) any facility which received Hazardous Materials generated
by any Loan Party or any of its Subsidiaries.
"Environmental Lien" means any Lien in favor of any Governmental
Authority for Environmental Liabilities and Costs.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import, and regulations
thereunder, in each case, as in effect from time to time. References to sections
of ERISA shall be construed also to refer to any successor sections.
"ERISA Affiliate" means, with respect to any Person, any trade or
business (whether or not incorporated) which is a member of a group of which
such Person is a member and which would be deemed to be a "controlled group"
within the meaning of Sections 414(b), (c), (m) and (o) of the Internal Revenue
Code.
"Event of Default" means any of the events set forth in Section 9.01.
"Excess Cash Flow" means, with respect to any Person for any period,
(i) Consolidated EBITDA of such Person and its Subsidiaries for such period,
less (ii) the sum of (A) the Consolidated Interest Expense of such Person and
its Subsidiaries for such period, (B) all cash income tax expense paid by such
Person and its Subsidiaries during such period, (C) all voluntary, scheduled and
mandatory cash principal payments on the Loans made during such period (but, in
the case of the Revolving Loans, only to the extent that the Total Revolving
Credit Commitment is permanently reduced by the amount of such payments), and
all scheduled cash principal payments on other Indebtedness of such Person or
any of its Subsidiaries during such period to the extent such other Indebtedness
is permitted to be incurred, and such payments are permitted to be made, under
this Agreement (D) the cash portion of Capital Expenditures made by such Person
and its Subsidiaries during such period to the extent permitted to be made under
this Agreement and (E) any cash received in respect of any Disposition of the
Capital Stock or assets of any Axis Entity.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Rate" means, with respect to Canadian Dollars in relation to
Dollars, the spot rate of exchange for the purchase of Canadian Dollars with
Dollars as published by The Wall Street Journal, Eastern Edition, on any date
or, with respect to Dollars in relation to Canadian Dollars, the spot rate of
exchange for the purchase of Dollars with Canadian Dollars as published by The
Wall Street Journal, Eastern Edition, on any date.
"Existing Credit Facility" means the Amended and Restated Revolving
Credit Agreement, dated as of January 20, 2000, as amended, among the Parent,
Allied Canada, Fleet National Bank, as successor to BankBoston, N.A., and the
other lending institutions identified as banks therein, Fleet National Bank, as
successor to BankBoston, N.A., as administrative agent for itself and the other
banks therein, ABN AMRO Bank, N.V., as documentation agent, Bank One, NA and
Bank of America, N.A., as co-agents, and The Bank of Nova Scotia, as the
Canadian agent.
-13-
"Existing Lenders" means the agents and lenders party to the Existing
Credit Facility.
"Extraordinary Receipts" means any cash received by the Parent or any
of its Subsidiaries not in the ordinary course of business, pension plan
reversions, proceeds of insurance (including proceeds of life insurance),
judgments, proceeds of settlements or other consideration of any kind in
connection with any cause of action, condemnation awards (and payments in lieu
thereof) and indemnity payments, provided that Extraordinary Receipts shall not
include any proceeds described in Section 2.05(c)(v), (vi) or (viii).
"Facility" means each real property set forth on Schedule 6.01(o)
hereto, including, without limitation, the land on which such facility is
located, all buildings and other improvements thereon, all fixtures located at
or used in connection with such facility, all whether now or hereafter existing.
"Federal Funds Rate" means, for any period, a fluctuating interest rate
per annum equal to, for each day during such period, the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day which is a Business Day, the average of the
quotations for such day on such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.
"Fee Letter" means the Fee Letter, dated as of February 25, 2002, among
the Borrowers, the Collateral Agent and the Administrative Agent.
"Field Survey and Audit" means a field survey, audit and appraisal
performed by auditors, examiners and/or appraisers selected by the Agents, at
the sole cost and expense of the Borrowers, the results of which shall be
acceptable by the Agents in their reasonable business judgment.
"Final Senior Loan Maturity Date" means February 25, 2005, or such
earlier date on which all Senior Loans shall become due and payable in
accordance with the terms of this Agreement and the other Loan Documents.
"Financial Statements" means (i) the audited consolidated balance sheet
of the Parent and its Subsidiaries for the Fiscal Year ended December 31, 2000,
and the related consolidated statement of operations, shareholders' equity and
cash flows for the Fiscal Year then ended, and (ii) the unaudited consolidated
balance sheet of the Parent and its Subsidiaries for the Fiscal Year ended
December 31, 2001, and the related consolidated statement of operations,
shareholder's equity and cash flows for the Fiscal Year then ended.
"Fiscal Year" means the fiscal year of the Parent and its Subsidiaries
ending on December 31st of each year.
"Fixed Charge Coverage Ratio" means, with respect to any Person for any
period, the ratio of (i) Consolidated EBITDA of such Person and its Subsidiaries
for such period, to (ii) the sum of (A) all principal of the Senior Loans
scheduled to be paid or voluntarily prepaid
-14-
during such period (in the case of the Revolving Loans, only to the extent there
is an equivalent permanent reduction in the Revolving Credit Commitment), plus
(B) Consolidated Net Interest Expense of such Person and its Subsidiaries for
such period, plus (C) cash dividends or distributions paid or payable by such
Person and its Subsidiaries during such period, (other than, in the case of any
Loan Party, dividends or distributions paid to such Loan Party) during such
period, to the extent such dividends or distributions are permitted by the terms
of this Agreement, plus (D) Capital Expenditures made by such Person and its
Subsidiaries during such period, plus (E) all amounts paid or payable by such
Person and its Subsidiaries on Operating Lease Obligations with respect to any
Rolling Stock constituting trucks, tractors or trailers having a scheduled due
date during such period. In determining the Fixed Charge Coverage Ratio for a
particular period (w) pro forma effect will be given to: (1) the incurrence,
repayment or retirement of any Indebtedness by such Person and its Subsidiaries
since the first day of such period as if such Indebtedness was incurred, repaid
or retired on the first day of such period and (2) the acquisition (whether by
purchase, merger or otherwise) or disposition (whether by sale, merger or
otherwise) of any property or assets acquired or disposed of by such Person and
its Subsidiaries since the first day of such period, as if such acquisition or
disposition occurred on the first day of such period; (x) interest on
Indebtedness bearing a floating interest rate will be computed as if the rate at
the time of computation had been the applicable rate for the entire period; (y)
if such Indebtedness bears, at the option of such Person and its Subsidiaries, a
fixed or floating rate of interest, interest thereon will be computed by
applying, at the option of such Person, either the fixed or floating rate; and
(z) the amount of Indebtedness under a revolving credit facility will be
computed based upon the average daily balance of such Indebtedness during such
period.
"GAAP" means generally accepted accounting principles in effect from
time to time in the United States, applied on a consistent basis, provided that
for the purpose of Section 7.03 hereof and the definitions used therein, "GAAP"
shall mean generally accepted accounting principles in effect on the date hereof
and consistent with those used in the preparation of the Financial Statements,
provided, further, that if there occurs after the date of this Agreement any
change in GAAP that affects in any respect the calculation of any covenant
contained in Section 7.03 hereof, the Collateral Agent and the Administrative
Borrower shall negotiate in good faith amendments to the provisions of this
Agreement that relate to the calculation of such covenant with the intent of
having the respective positions of the Senior Lenders and the Borrowers after
such change in GAAP conform as nearly as possible to their respective positions
as of the date of this Agreement and, until any such amendments have been agreed
upon, the covenants in Section 7.03 hereof shall be calculated as if no such
change in GAAP has occurred.
"Governmental Authority" means any nation or government (including,
without limitation, the federal government of Canada), any Federal, state, city,
town, municipality, county, local or other political subdivision thereof or
thereto (including, without limitation, any provincial authority of Canada) and
any department, commission, board, bureau, instrumentality, agency or other
entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
"Gross Orderly Liquidation Value" means, with respect to the Eligible
Rolling Stock, as of any date of determination, the gross orderly liquidation
value thereof as determined
-15-
by an independent third party appraiser acceptable to the Agents pursuant to an
appraisal conducted in accordance with Section 7.01(f)(ii), prior to any
deduction for expenses.
"Guaranty" means (i) the guaranty of each Guarantor party hereto
contained in Article XI hereof, and (ii) each guaranty substantially in the form
of Exhibit A, made by a Guarantor in favor of the Collateral Agent for the
benefit of the Lenders pursuant to Section 7.01(b) or otherwise.
"Guarantor" means (i) each Subsidiary of the Parent listed as a
"Guarantor" on the signature pages hereto, (ii) each other Person which
guarantees, pursuant to Section 7.01(b) or otherwise, all or any part of the
Obligations and (iii) with respect to Article XI, each Borrower, with respect to
the Obligations of the other Borrower.
"Haul Insurance" means Haul Insurance Limited, a Cayman Island company.
"Hazardous Material" means (a) any element, compound or chemical that
is defined, listed or otherwise classified as a contaminant, pollutant, toxic
pollutant, toxic or hazardous substance, extremely hazardous substance or
chemical, hazardous waste, special waste, or solid waste under Environmental
Laws, including, without limitation, any contamination, pollutant, toxic
pollutant, toxic or hazardous substance, extremely hazardous substance or
chemical, hazardous waste, special waste, or solid waste which is defined or
identified in any Environmental Law and which is present in the environment in
such quantity or state that it violates any Environmental Law; (b) petroleum and
its refined products; (c) polychlorinated biphenyls; (d) any substance
exhibiting a hazardous waste characteristic, including, without limitation,
corrosivity, ignitability, toxicity or reactivity as well as any radioactive or
explosive materials; and (e) any raw materials, building components (including,
without limitation, asbestos-containing materials) and manufactured products
containing hazardous substances listed or classified as such under Environmental
Laws.
"Hedging Agreement" means any interest rate, foreign currency,
commodity or equity swap, collar, cap, floor or forward rate agreement, or other
agreement or arrangement designed to protect against fluctuations in interest
rates or currency, or commodity or equity values (including, without limitation,
any option with respect to any of the foregoing and any combination of the
foregoing agreements or arrangements), and any confirmation executed in
connection with any such agreement or arrangement; provided, however, that
Hedging Agreements shall not include any agreement or arrangement (i) to
purchase fuel in the ordinary course of business, consistent with past practice,
or (ii) contained in a customer contract entered into in the ordinary course of
business, consistent with past practice, that adjusts payments based upon the
cost of fuel to such Loan Party.
"Highest Lawful Rate" means, with respect to any Agent or any Lender,
the maximum non-usurious interest rate, if any, that at any time or from time to
time may be contracted for, taken, reserved, charged or received on the
Obligations under laws applicable to such Agent or such Lender which are
currently in effect or, to the extent allowed by law, under such applicable laws
which may hereafter be in effect and which allow a higher maximum non-usurious
interest rate than applicable laws now allow.
-16-
"Indebtedness" means, with respect to any Person, without duplication,
(i) all indebtedness of such Person for borrowed money; (ii) all obligations of
such Person for the deferred purchase price of property or services (other than
trade payables or other accounts payable incurred in the ordinary course of such
Person's business and not outstanding for more than 90 days after the date such
payable was created); (iii) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments or upon which interest payments
are customarily made; (iv) all reimbursement, payment or other obligations and
liabilities of such Person created or arising under any conditional sales or
other title retention agreement with respect to property used and/or acquired by
such Person, even though the rights and remedies of the lessor, seller and/or
lender thereunder may be limited to repossession or sale of such property; (v)
all Capitalized Lease Obligations of such Person; (vi) all obligations and
liabilities, contingent or otherwise, of such Person, in respect of letters of
credit, acceptances and similar facilities; provided, that, in the case of the
Parent and its Subsidiaries, the Axis Netherlands L/C shall not constitute
Indebtedness so long as such letter of credit is cash collateralized in an
amount not less than 100% of the stated amount thereof; (vii) all obligations
and liabilities, calculated on a basis satisfactory to the Collateral Agent and
in accordance with accepted practice, of such Person under Hedging Agreements;
(viii) all Contingent Obligations; (ix) liabilities incurred under Title IV of
ERISA with respect to any plan (other than a Multiemployer Plan) covered by
Title IV of ERISA and maintained for employees of such Person or any of its
ERISA Affiliates to the extent such liabilities are not paid when due and
payable; (x) withdrawal liability incurred under ERISA by such Person or any of
its ERISA Affiliates with respect to any Multiemployer Plan to the extent such
liabilities are not paid when due and payable; and (xi) all obligations referred
to in clauses (i) through (x) of this definition of another Person secured by
(or for which the holder of such Indebtedness has an existing right, contingent
or otherwise, to be secured by) a Lien upon property owned by such Person, even
though such Person has not assumed or become liable for the payment of such
Indebtedness. The Indebtedness of any Person shall include the Indebtedness of
any partnership of or joint venture in which such Person is a general partner or
a joint venturer if such Person is liable for the obligations of such
partnership or joint venture.
"Indemnified Matters" has the meaning specified therefor in Section
12.15.
"Indemnitees" has the meaning specified therefor in Section 7.01(j).
"Indenture" means the Indenture, dated as of September 30, 1997,
between the Parent and The First National Bank of Chicago, as trustee with
respect to the Senior Notes.
"Insolvency Proceeding" means any proceeding commenced by or against
any Person under any provision of the Bankruptcy Code or under any other
bankruptcy or insolvency law (including, without limitation, the Bankruptcy and
Insolvency Act (Canada) and the Companies Creditors Arrangement Act (Canada)),
assignments for the benefit of creditors, formal or informal moratoria,
compositions, or extensions generally with creditors, or proceedings seeking
reorganization, arrangement, or other similar relief.
"Interest Period" means, with respect to any LIBOR Rate Loan, the
period commencing on the borrowing date or the date of any continuation of such
LIBOR Rate Loan, as the case may be, and ending two weeks or one, two or three
months thereafter, in each case as
-17-
selected by the Administrative Borrower in the applicable notice given to the
Administrative Agent pursuant to Sections 2.02 or 2.11 hereof, provided that (i)
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 and (ii) no Interest Period for any LIBOR Rate
Loan shall end after the Final Senior Loan Maturity Date.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended (or any successor statute thereto) and the regulations thereunder.
"Inventory" means, with respect to any Person, all goods and
merchandise of such Person (including, without limitation, all raw materials,
work-in-process, packaging, supplies, materials and finished goods of every
nature) used or usable in connection with the shipping, storing, advertising or
sale of such goods and merchandise, whether now owned or hereafter acquired, and
all such other property the sale or other disposition of which would give rise
to an Account Receivable or cash.
"Judgment Currency" has the meaning specified therefor in Section
11.07.
"Lease" means any lease of real property to which any Loan Party is a
party as lessor or lessee.
"L/C Issuer" means Wells Fargo Bank, National Association, or such
other bank as the Administrative Agent may select in its reasonable business
judgment.
"L/C Subfacility" means that portion of the Total Revolving Credit
Commitment equal to $27,600,000, provided that (i) if the Canadian Facility L/C
has been drawn upon in full or returned for cancellation, the L/C Subfacility
shall automatically be reduced by $2,600,000 and/or (ii) if the Cash Management
Bank L/C has been drawn upon in full or returned for cancellation, the L/C
Subfacility shall automatically be reduced by $5,000,000, provided that (A) in
the case of partial drawings, the Letter of Credit described in clauses (i) or
(ii) above subject to such partial drawing shall only be reduced by the amount
of such partial drawing and (B) cancellations of a Letter of Credit described in
clauses (i) or (ii) above solely in connection with a change of beneficiary
shall not result in a reduction of the L/C Subfacility.
"Lender" has the meaning specified therefor in the preamble hereto.
"Lender Default" has the meaning specified therefor in Section 12.20.
"Letter of Credit" has the meaning specified therefor in Section
3.01(a).
"Letter of Credit Application" has the meaning specified therefor in
Section 3.01(a).
"Letter of Credit Fee" has the meaning specified therefor in Section
3.03(b).
"Letter of Credit Guaranty" means one or more guaranties indemnities
or participations by the Administrative Agent in favor of the L/C Issuer
guaranteeing or relating to
-18-
the Borrowers' obligations to the L/C Issuer under a reimbursement agreement,
Letter of Credit Application or other document in respect of any Letter of
Credit.
"Letter of Credit Obligations" means, at any time and without
duplication, the sum of (i) the Reimbursement Obligations at such time, plus
(ii) the aggregate maximum amount available for drawing under the Letters of
Credit outstanding at such time, plus (iii) all amounts for which the
Administrative Agent may be liable to the L/C Issuer pursuant to any Letter of
Credit Guaranty.
"Liabilities" has the meaning specified therefor in Section 2.07.
"Lien" means any mortgage, deed of trust, hypothec, debenture, pledge,
lien (statutory or otherwise), security interest, charge or other encumbrance or
security or preferential arrangement of any nature, including, without
limitation, any conditional sale or title retention arrangement, any Capitalized
Lease and any assignment, deposit arrangement or financing lease intended as, or
having the effect of, security.
"LIBOR" means, with respect to any Interest Period, the rate per annum
determined by the LIBOR Reference Bank in New York, New York on the basis of the
rates at which Dollar deposits are offered to major banks in the London
interbank market on or about 2:00 p.m. (New York City time) 2 Business Days
prior to the commencement of the applicable Interest Period, for a term and in
amounts comparable to the Interest Period and amount of the LIBOR Rate Loan
requested by the Administrative Borrower in accordance with this Agreement, or,
if the foregoing rate is unavailable, the rate per annum determined by the
Administrative Agent in accordance with its customary procedures, and utilizing
such electronic or other quotation sources as it considers appropriate, in each
case rounded upwards to, if necessary to the next 1/16% which determination
shall be conclusive in the absence of manifest error.
"LIBOR Rate" means, for each Interest Period for each LIBOR Rate Loan,
the rate per annum determined by the Administrative Agent (rounded upwards if
necessary, to the next 1/16%) by dividing (a) LIBOR for such Interest Period by
(b) 100% minus the Reserve Percentage. The LIBOR Rate shall be adjusted on and
as of the effective day of any change in the Reserve Percentage.
"LIBOR Rate Loan" means a Revolving Loan bearing interest calculated
based upon the LIBOR Rate.
"LIBOR Reference Bank" means Wells Fargo Bank, National Association,
its successors or any other bank designated by the Administrative Agent to the
Administrative Borrower from time to time.
"Loan" means any Senior Loan or the Subordinated Term Loan D.
"Loan Account" means an account maintained hereunder by the
Administrative Agent on its books of account, at the Payment Office and with
respect to the Borrowers, in which the Borrowers will be charged with all Senior
Loans made to, and all other Senior Obligations incurred by, the Borrowers.
-19-
"Loan Document" means this Agreement, any Guaranty, any Security
Agreement, any Pledge Agreement, any Mortgage, any Letter of Credit Application,
the Contribution Agreement, the Canadian Security Documents, the PPSA Filing
Authorization Letter, the Fee Letter, the Custodian Agreement, any UCC Filing
Authorization Letter, the Subordinated Term Loan D Notes and any other
agreement, instrument, and other document executed and delivered pursuant hereto
or thereto or otherwise evidencing or securing any Loan, any Letter of Credit
Obligation or any other Obligation.
"Loan Party" means any Borrower or any Guarantor.
"Lockbox Bank" has the meaning specified therefor in Section 8.01(a).
"Lockboxes" has the meaning specified therefor in Section 8.01(a).
"Material Adverse Effect" means a material adverse effect on any of (i)
the operations, business, assets, properties or condition (financial or
otherwise) of any Borrower or of the Loan Parties taken as a whole, (ii) the
ability of any Designated Loan Party to perform any of its obligations under any
Loan Document to which it is a party, (iii) the legality, validity or
enforceability of this Agreement or any other Loan Document, (iv) the rights and
remedies of any Agent or any Lender under any Loan Document, or (v) the
validity, perfection or priority of a Lien in favor of the Collateral Agent for
the benefit of the Lenders on any of the Collateral.
"Material Contract" means, with respect to any Person, (i) each
contract or agreement to which such Person or any of its Subsidiaries is a party
involving aggregate consideration payable to or by such Person or such
Subsidiary of $5,000,000 or more (other than purchase orders in the ordinary
course of the business of such Person or such Subsidiary and other than
contracts that by their terms may be terminated by such Person or Subsidiary in
the ordinary course of its business upon less than 60 days' notice without
penalty or premium) and (ii) all other contracts or agreements material to the
business, operations, condition (financial or otherwise), performance or
properties of such Person and its Subsidiaries taken as a whole; provided,
however, that Material Contracts shall not include any Collective Bargaining
Agreements or any customer contract entered into in the ordinary course of
business.
"Maximum Senior Principal Amount" means the amount of Indebtedness
permitted to be incurred under clause (i) of the second paragraph of Section
4.09 of the Indenture as in effect on the Effective Date.
"Moody's" means Moody's Investors Service, Inc. and any successor
thereto.
"Mortgage" means a mortgage (including, without limitation, a leasehold
mortgage), charge, deed of trust, deed to secure debt or debenture, in form and
substance satisfactory to the Collateral Agent, made by a Loan Party in favor of
the Collateral Agent for the benefit of the Lenders, securing the Obligations
and delivered to the Collateral Agent pursuant to Section 5.01(d), Section
7.01(b), Section 7.01(n) or otherwise.
"Motor Vehicle Laws" shall mean all Federal (including, the federal
government of Canada), state, provincial and local laws, regulations, rules and
judicial or agency determinations and orders applicable to the ownership and/or
operation of vehicles (including,
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without limitation, the Rolling Stock), or the business of the transportation of
goods by motor vehicle, including, without limitation, laws, regulations, rules
and judicial or agency determinations and orders promulgated or administered by
the Federal Highway Administration, the Federal Motor Carrier Safety
Administration, the National Highway Traffic Safety Administration, the Surface
Transportation Board and other state, provincial and local Governmental
Authorities with respect to vehicle safety and registration and motor carrier
insurance, financial assurance, credit extension, contract carriage, tariff and
reporting requirements.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA for which any Loan Party or any of its ERISA Affiliates has
contributed to, or has been obligated to contribute to, at any time during the
preceding six (6) years.
"Net Amount of Eligible Accounts Receivable" means the aggregate unpaid
invoice amount of Eligible Accounts Receivable less, without duplication, sales,
excise or similar taxes, returns, discounts, chargebacks, claims, advance
payments, credits and allowances of any nature at any time issued, owing,
granted, outstanding, available or claimed with respect to such Eligible
Accounts Receivable.
"Net Book Value" means, with respect to any Eligible Rolling Stock, the
value of such Eligible Rolling Stock (as reflected in the general ledger of such
Person after customary depreciation and reserves established by such Person in
good faith and in accordance with GAAP).
"Net Cash Proceeds" means, (i) with respect to any Disposition by any
Person or any of its Subsidiaries, the amount of cash received (directly or
indirectly) from time to time (whether as initial consideration or through the
payment of deferred consideration) by or on behalf of such Person or such
Subsidiary, in connection therewith after deducting therefrom only (A) the
amount of any Indebtedness secured by any Lien permitted by Section 7.02(a) on
any asset (other than Indebtedness assumed by the purchaser of such asset) which
is required to be, and is, repaid in connection with such Disposition (other
than Indebtedness under this Agreement), (B) reasonable expenses related thereto
incurred by such Person or such Subsidiary in connection therewith, (C) transfer
taxes paid to any taxing authorities by such Person or such Subsidiary in
connection therewith, and (D) net income taxes to be paid in connection with
such Disposition (after taking into account any tax credits or deductions and
any tax sharing arrangements) and (ii) with respect to the issuance or
incurrence of any Indebtedness by any Person or any of its Subsidiaries, or the
sale or issuance by any Person or any of its Subsidiaries of any shares of its
Capital Stock, the aggregate amount of cash received (directly or indirectly)
from time to time (whether as initial consideration or through the payment of
deferred consideration) by or on behalf of such Person or such Subsidiary in
connection therewith, after deducting therefrom only (A) reasonable expenses
related thereto incurred by such Person or such Subsidiary in connection
therewith, (B) transfer taxes paid by such Person or such Subsidiary in
connection therewith and (C) net income taxes to be paid in connection therewith
(after taking into account any tax credits or deductions and any tax sharing
arrangements).
"Net Orderly Liquidation Value" means, with respect to the Eligible
Rolling Stock, as of any date of determination, the gross orderly liquidation
value thereof as determined
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by an independent third party appraiser acceptable to the Agents pursuant to an
appraisal conducted in accordance with Section 7.01(f)(ii), minus deductions for
expenses related to any proposed liquidation of such Eligible Rolling Stock.
"Non-Defaulting Lender" has the meaning specified therefor in Section
12.20.
"Notice of Borrowing" has the meaning specified therefor in Section
2.02(a).
"Obligations" means (i) the obligations of any Borrower to pay, as and
when due and payable (by scheduled maturity or otherwise), all amounts from time
to time owing by it in respect of any Loan Document to which it is a party,
whether for principal, interest (including without limitation, all interest that
accrues after the commencement of any Insolvency Proceeding of any Borrower,
whether or not a claim for post-filing interest is allowed in such proceeding),
all Letter of Credit Obligations, fees, commissions, expense reimbursements,
indemnifications or otherwise and (ii) the obligations of any Borrower to
perform or observe all of its other obligations from time to time existing under
any Loan Document to which it is a party.
"Operating Accounts" means the operating bank accounts of the Loan
Parties set forth on Schedule 8.01(a).
"Operating Lease Obligations" means all obligations for the payment of
rent for any real or personal property under leases or agreements to lease,
other than (x) Capitalized Lease Obligations, (y) obligations incurred by any
Loan Party with respect to any lease used for the temporary storage of Rolling
Stock owned by a customer of such Loan Party, which lease is either month to
month or cancelable by such Loan Party on not more than thirty (30) days notice,
to the extent such obligations associated therewith are reimbursable by such
customer, the aggregate amount of such obligations at any time does not exceed
$1,000,000 and (z) lease payments for tractors and/or trailers to
owner-operators made in the ordinary course of business, consistent with past
practice.
"Orderly Liquidation Values" means the Gross Orderly Liquidation Value
and the Net Orderly Liquidation Value.
"Parent" has the meaning specified therefor in the preamble hereto.
"Participant Register" has the meaning specified therefor in Section
12.07(b)(v).
"Payment Office" means the Administrative Agent's office located at
2450 Colorado Avenue, Suite 3000 West, Santa Monica, California, or at such
other office or offices of the Administrative Agent as may be designated in
writing from time to time by the Administrative Agent to the Collateral Agent
and the Administrative Borrower.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto.
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"Permitted Holder" means the directors and executive officers of the
Parent on the Effective Date and their spouses, lineal descendants and trusts or
other similar entities established for the benefit of such individuals.
"Permitted Indebtedness" means:
(a) any Indebtedness owing to any Agent and any Lender under this
Agreement and the other Loan Documents;
(b) any Indebtedness listed on Schedule 7.02(b), and the extension
of maturity, refinancing or modification of the terms thereof; provided,
however, that (i) such extension, refinancing or modification is pursuant to
terms that are not less favorable to the Loan Parties and the Senior Lenders
than the terms of the Indebtedness being extended, refinanced or modified and
(ii) after giving effect to such extension, refinancing or modification the
principal amount of such Indebtedness is not greater than the principal amount
of Indebtedness outstanding immediately prior to such extension, refinancing or
modification;
(c) Indebtedness evidenced by Capitalized Lease Obligations
entered into in order to finance Capital Expenditures made by the Loan Parties
in accordance with the provisions of Section 7.02(g), which Indebtedness, when
aggregated with the principal amount of all Indebtedness incurred under this
clause (c) and clause (d) of this definition, does not exceed $1,000,000 at any
time outstanding;
(d) Indebtedness permitted by clause (e) of the definition of
"Permitted Lien";
(e) Indebtedness permitted under Section 7.02(e);
(f) Subordinated Indebtedness;
(g) Indebtedness of Allied Canada under the Canadian Facility;
(h) Indebtedness of the Parent or any of its Subsidiaries under
any Hedging Agreement so long as such Hedging Agreements are used solely as a
part of its normal business operations as a risk management strategy and/or
hedge against changes resulting from market operations and not as a means to
speculate for investment purposes on trends and shifts in financial or
commodities markets;
(i) Indebtedness in respect of insurance premium finance
arrangements, provided that, such Indebtedness is incurred in the ordinary
course of business of a Loan Party, consistent with past practice;
(j) other unsecured Indebtedness in an aggregate principal amount
not to exceed $1,000,000 at any time;
(k) Contingent Obligations with respect to obligations not
constituting Indebtedness that are permitted to be incurred under this
Agreement; and
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(l) intercompany Indebtedness payable by Axis Netherlands, LLC
and/or the Parent to Haul Insurance the aggregate principal amount of which
shall not exceed $1,650,000.
"Permitted Investments" means (i) marketable direct obligations issued
or unconditionally guaranteed by the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case, maturing within six months from the date of acquisition thereof; (ii)
commercial paper, maturing not more than 270 days after the date of issue rated
P-1 by Moody's or A-1 by Standard & Poor's; (iii) certificates of deposit
maturing not more than 270 days after the date of issue, issued by commercial
banking institutions and money market or demand deposit accounts maintained at
commercial banking institutions, each of which is a member of the Federal
Reserve System and has a combined capital and surplus and undivided profits of
not less than $500,000,000; (iv) repurchase agreements having maturities of not
more than 90 days from the date of acquisition which are entered into with major
money center banks included in the commercial banking institutions described in
clause (iii) above and which are secured by readily marketable direct
obligations of the United States Government or any agency thereof, (v) money
market accounts maintained with mutual funds having assets in excess of
$2,500,000,000; (vi) tax exempt securities rated A or better by Moody's or A+ or
better by Standard & Poor's; and (vii) in the case of any Canadian Entity,
investments that are substantially equivalent to the foregoing investments
described in clauses (i) through (vi) above that are available in Canadian
Dollars.
"Permitted Liens" means:
(a) Liens securing the Obligations;
(b) Liens for taxes, assessments and governmental charges the
payment of which is not required under Section 7.01(c);
(c) Liens imposed by law, such as carriers', warehousemen's,
mechanics', materialmen's and other similar Liens arising in the ordinary course
of business and securing obligations (other than Indebtedness for borrowed
money) that are not overdue by more than 30 days or are being contested in good
faith and by appropriate proceedings promptly initiated and diligently
conducted, and a reserve or other appropriate provision, if any, as shall be
required by GAAP shall have been made therefor;
(d) Liens described on Schedule 7.02(a), and the extension of
maturity, refinancing or other modification of the terms thereof but not the
extension of coverage thereof to other property or the increase in the principal
amount of the Indebtedness secured thereby;
(e) (i) purchase money Liens on equipment acquired or held by any
Loan Party in the ordinary course of its business to secure the purchase price
of such equipment or Indebtedness incurred solely for the purpose of financing
the acquisition of such equipment or (ii) Liens existing on such equipment at
the time of its acquisition; provided, however, that (A) no such Lien shall
extend to or cover any other property of any Loan Party other than the proceeds
of such property, (B) the principal amount of the Indebtedness secured by any
such Lien shall not exceed the lesser of 80% of the fair market value or the
cost of the property so
-24-
held or acquired and (C) the aggregate principal amount of Indebtedness secured
by any or all such Liens shall not exceed at any one time outstanding
$1,000,000;
(f) deposits and pledges securing (i) obligations incurred in
respect of workers' compensation, unemployment insurance or other forms of
governmental insurance or benefits, (ii) the performance of bids, tenders,
leases, contracts (other than for the payment of money) and statutory
obligations or (iii) obligations on surety or appeal bonds, but only to the
extent such deposits or pledges are incurred or otherwise arise in the ordinary
course of business and secure obligations not past due;
(g) easements, zoning restrictions and similar encumbrances on
real property and minor irregularities in the title thereto that do not (i)
secure obligations for the payment of money or (ii) materially impair the value
of such property or its use by any Loan Party or any of its Subsidiaries in the
normal conduct of such Person's business;
(h) Liens securing Indebtedness permitted by subsection (c) of the
definition of Permitted Indebtedness;
(i) Liens on the unearned premiums under the insurance policies
permitted to be financed under subsection (i) of the definition of Permitted
Indebtedness; and
(i) Liens in connection with the pledging of cash collateral for
the Axis Netherlands L/C.
"Person" means an individual, corporation, limited liability company,
partnership, association, joint-stock company, trust, unincorporated
organization, joint venture or other enterprise or entity or Governmental
Authority.
"Pledge Agreement" means a Pledge and Security Agreement made by a Loan
Party in favor of the Collateral Agent for the benefit of the Lenders,
substantially in the form of Exhibit C, securing the Obligations and delivered
to the Collateral Agent.
"Post-Default Rate" means a rate of interest per annum equal to (a) in
the case of the Senior Obligations, the rate of interest otherwise in effect
from time to time pursuant to the terms of this Agreement plus 3.0%, or, if a
rate of interest is not otherwise in effect, interest at the highest rate
specified herein for any Senior Loan then outstanding prior to an Event of
Default plus 3.0% and (b) in the case of the Subordinated Obligations, the rate
per annum otherwise in effect from time to time pursuant to the terms of the
Subordinated Term Loan D Notes plus 2.0%.
"PPSA" means any personal property security legislation or any similar
legislation enacted in any province or federal territory of Canada or enacted by
the federal government of Canada.
"PPSA Filing Authorization Letter" means a letter duly executed by the
applicable Loan Parties authorizing the Collateral Agent to file appropriate
financing statements without the signature of such Loan Party in such provincial
personal property security office or
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offices as may be necessary or, in the opinion of the Collateral Agent,
desirable to perfect the security interests purported to be created by the
Canadian Security Documents.
"Prepayment Premium" has the meaning specified in Section 2.06(b).
"Pro Rata Share" means:
(a) with respect to a Revolving Loan Lender's obligation to make
Revolving Loans and receive payments of interest, fees and principal with
respect thereto, the percentage obtained by dividing (i) such Lender's Revolving
Credit Commitment, by (ii) the Total Revolving Credit Commitment, provided,
that, if the Total Revolving Credit Commitment has been reduced to zero, the
numerator shall be the aggregate unpaid principal amount of such Lender's
Revolving Loans (including Agent Advances) and its interest in the Letter of
Credit Obligations and the denominator shall be the aggregate unpaid principal
amount of all Revolving Loans (including Agent Advances) and Letter of Credit
Obligations,
(b) with respect to a Term Loan A Lender's obligation to make the
Term Loan A and receive payments of interest, fees and principal with respect
thereto, the percentage obtained by dividing (i) such Lender's Term Loan A
Commitment, by (ii) the Total Term Loan A Commitment, provided that if the Total
Term Loan A Commitment has been reduced to zero, the numerator shall be the
aggregate unpaid principal amount of such Lender's portion of the Term Loan A
and the denominator shall be the aggregate unpaid principal amount of the Term
Loan A,
(c) with respect to a Term Loan B Lender's obligation to make the
Term Loan B and receive payments of interest, fees and principal with respect
thereto, the percentage obtained by dividing (i) such Lender's Term Loan B
Commitment, by (ii) the Total Term Loan B Commitment, provided that if the Total
Term Loan B Commitment has been reduced to zero, the numerator shall be the
aggregate unpaid principal amount of such Lender's portion of the Term Loan B
and the denominator shall be the aggregate unpaid principal amount of the Term
Loan B,
(d) with respect to a Term Loan C Lender's obligation to make the
Term Loan C and receive payments of interest, fees and principal with respect
thereto, the percentage obtained by dividing (i) such Lender's Term Loan C
Commitment, by (ii) the Total Term Loan C Commitment, provided that if the Total
Term Loan C Commitment has been reduced to zero, the numerator shall be the
aggregate unpaid principal amount of such Lender's portion of the Term Loan C
and the denominator shall be the aggregate unpaid principal amount of the Term
Loan C,
(e) with respect to a Subordinated Term Loan D Lender's obligation
to make the Subordinated Term Loan D and receive payments of interest, fees and
principal with respect thereto, the percentage obtained by dividing (i) such
Lender's Subordinated Term Loan D Commitment, by (ii) the Total Subordinated
Term Loan D Commitment, provided that if the Total Subordinated Term Loan D
Commitment has been reduced to zero, the numerator shall be the aggregate unpaid
principal amount of such Lender's portion of the Subordinated Term Loan D and
the denominator shall be the aggregate unpaid principal amount of the
Subordinated Term Loan D,
(f) with respect to any indemnification obligations under Section
10.05 arising from or related to the Collateral, the percentage obtained by
dividing (i) the sum of such
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Lender's Revolving Credit Commitment and the unpaid principal amount of such
Lender's portion of the Senior Term Loans and the unpaid principal amount of
such Lender's Subordinated Term Loan D, by (ii) the sum of the Total Revolving
Credit Commitment and the aggregate unpaid principal amount of the Senior Term
Loans and the aggregate unpaid principal amount of the Subordinated Term Loan D,
provided, that, if such Lender's Revolving Credit Commitment shall have been
reduced to zero, such Lender's Revolving Credit Commitment shall be deemed to be
the aggregate unpaid principal amount of such Lender's Revolving Loans
(including Agent Advances) and its interest in the Letter of Credit Obligations
and if the Total Revolving Credit Commitment shall have been reduced to zero,
the Total Revolving Credit Commitment shall be deemed to be the aggregate unpaid
principal amount of all Revolving Loans (including Agent Advances) and Letter of
Credit Obligations, and
(g) with respect to all other matters, the percentage obtained by
dividing (i) the sum of such Lender's Revolving Credit Commitment and the unpaid
principal amount of such Lender's portion of the Senior Term Loans, by (ii) the
sum of the Total Revolving Credit Commitment and the aggregate unpaid principal
amount of the Senior Term Loans, provided, that, if such Lender's Revolving
Credit Commitment shall have been reduced to zero, such Lender's Revolving
Credit Commitment shall be deemed to be the aggregate unpaid principal amount of
such Lender's Revolving Loans (including Agent Advances) and its interest in the
Letter of Credit Obligations and if the Total Revolving Credit Commitment shall
have been reduced to zero, the Total Revolving Credit Commitment shall be deemed
to be the aggregate unpaid principal amount of all Revolving Loans (including
Agent Advances) and Letter of Credit Obligations;
provided that, notwithstanding the foregoing, after the Senior Facility
Termination Date, with respect to all matters, Pro Rata Share shall be
determined pursuant to clause (e) above.
"property" means any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible.
"Rating Agencies" has the meaning specified therefor in Section 2.07.
"Reference Bank" means JPMorgan Chase Bank, its successors or any other
commercial bank designated by the Collateral Agent to the Administrative
Borrower from time to time.
"Reference Rate" means the rate of interest publicly announced by the
Reference Bank in New York, New York from time to time as its reference rate,
base rate or prime rate. The reference rate, base rate or prime rate is
determined from time to time by the Reference Bank as a means of pricing some
loans to its borrowers and neither is tied to any external rate of interest or
index nor necessarily reflects the lowest rate of interest actually charged by
the Reference Bank to any particular class or category of customers. Each change
in the Reference Rate shall be effective from and including the date such change
is publicly announced as being effective.
"Reference Rate Loan" means a Loan bearing interest calculated based
upon the Reference Rate.
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"Register" has the meaning specified therefor in Section 12.07(b)(ii).
"Regulation T", "Regulation U" and "Regulation X" mean, respectively,
Regulations T, U and X of the Board or any successor, as the same may be amended
or supplemented from time to time.
"Reimbursement Obligations" means the obligation of each Borrower to
reimburse the Administrative Agent or any Senior Lender for amounts payable by
the Administrative Agent or any Lender under a Letter of Credit Guaranty in
respect of any drawing made under any Letter of Credit, together with interest
thereon as provided in Section 2.04.
"Release" means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, seeping, migrating,
dumping or disposing of any Hazardous Material (including the abandonment or
discarding of barrels, containers and other closed receptacles containing any
Hazardous Material) into the indoor or outdoor environment, including, without
limitation, the movement of Hazardous Materials through or in the ambient air,
soil, surface or ground water, or property.
"Remedial Action" means all actions taken to (i) clean up, remove,
remediate, contain, treat, monitor, assess, evaluate or in any other way address
Hazardous Materials in the indoor or outdoor environment; (ii) prevent or
minimize a Release or threatened Release of Hazardous Materials so they do not
migrate or endanger or threaten to endanger public health or welfare or the
indoor or outdoor environment; (iii) perform, with respect to the Release,
threatened Release or presence of Hazardous Materials, pre-remedial studies and
investigations and post-remedial operation and maintenance activities; or (iv)
perform any other actions authorized by 42 U.S.C. ss. 9601.
"Reportable Event" means an event described in Section 4043 of ERISA
(other than an event not subject to the provision for 30-day notice to the PBGC
under the regulations promulgated under such Section).
"Required Lenders" means (i) prior to the Senior Facility Termination
Date, Senior Lenders whose Pro Rata Shares of the Senior Term Loans aggregate at
least 51% and (ii) after the Senior Facility Termination Date, Subordinated Term
Loan D Lenders whose Pro Rata Shares of the Subordinated Term Loan D aggregate
at least 66-2/3%.
"Required Revolving Lenders" means Lenders whose Pro Rata Shares
(calculated in accordance with clause (a) of the definition thereof) of the
Total Revolving Credit Commitment aggregate at least 51%; provided, that such
Lenders are composed of not less than two Senior Lenders, which have Revolving
Credit Commitments, one of which (together with its Affiliates) holds no Senior
Term Loans.
"Required Subordinated Lenders" has the meaning specified therefor in
Section 12.02(f).
"Reserve Percentage" means, on any day, for any Senior Lender, the
maximum percentage prescribed by the Board of Governors of the Federal Reserve
System (or any successor Governmental Authority) for determining the reserve
requirements (including any
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basic, supplemental, marginal, or emergency reserves) that are in effect on such
date with respect to eurocurrency funding (currently referred to as
"eurocurrency liabilities") of that Senior Lender, but so long as such Senior
Lender is not required or directed under applicable regulations to maintain such
reserves, the Reserve Percentage shall be zero.
"Revolving Credit Commitment" means, with respect to each Senior
Lender, the commitment of such Senior Lender to make Revolving Loans to Allied
Systems in the amount set forth opposite such Senior Lender's name in Schedule
1.01(A) hereto, as such amount may be terminated or reduced from time to time in
accordance with the terms of this Agreement.
"Revolving Loan" means a loan made by a Senior Lender to Allied Systems
pursuant to Section 2.01(a)(i).
"Revolving Loan Lender" means a Senior Lender with a Revolving Credit
Commitment.
"Revolving Loan Obligations" means any Obligations with respect to the
Revolving Loans (including without limitation, the principal thereof, the
interest thereon, and the fees and expenses specifically related thereto).
"Rolling Stock" means all trucks, trailers, tractors, service vehicles,
automobiles and other mobile equipment.
"Rolling Stock Collateral Custodian" has the meaning specified therefor
in Section 8.04(a).
"Rolling Stock Depreciation Amount" means, as of any month, an amount
which is calculated on a cumulative basis from the first month commencing after
the date on which the Agents receive the most recent appraisal delivered
pursuant to Section 7.01(f)(ii) equal to (i) the cumulative monthly depreciation
with respect to all Eligible Rolling Stock of the Designated Loan Parties
(excluding any Axis Entity) from the date of the most recent appraisal delivered
to the Agents pursuant to Section 7.01(f)(ii) and in accordance with GAAP,
multiplied by (ii) a fraction (A) the numerator of which is equal to the Gross
Orderly Liquidation Value of all such Eligible Rolling Stock as at the time of
the most recent appraisal and (B) the denominator of which is equal to the Net
Book Value of all such Eligible Rolling Stock as at the time of such appraisal.
The monthly depreciation amount of the Eligible Rolling Stock shall be
determined by depreciating such Eligible Rolling Stock no more slowly and to a
residual value no greater than that resulting from the method set forth on
Schedule 1.01(C) hereto.
"SEC" means the Securities and Exchange Commission or any other similar
or successor agency of the Federal government administering the Securities Act.
"Securities Act" means the Securities Act of 1933, as amended, or any
similar Federal statute, and the rules and regulations of the SEC thereunder,
all as the same shall be in effect from time to time.
"Securitization" has the meaning specified therefor in Section 2.07.
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"Securitization Parties" has the meaning specified therefor in Section
2.07.
"Security Agreement" means a Security Agreement made by a Loan Party in
favor of the Collateral Agent for the benefit of the Lenders, substantially in
the form of Exhibit B-1, securing the Obligations and delivered to the
Collateral Agent.
"Senior Commitments" means, with respect to each Lender, such Lender's
Revolving Credit Commitment, Term Loan A Commitment, Term Loan B Commitment and
Term Loan C Commitment.
"Senior Facility Termination Date" has the meaning specified therefor
in Section 2.06(b).
"Senior Lender" has the meaning specified therefor in the preamble
hereto.
"Senior Loan" means any Senior Term Loan or any Revolving Loan made by
an Agent or a Senior Lender to Allied Systems pursuant to Article II hereof.
"Senior Notes" means the 8-5/8% Senior Notes Due 2007 governed by the
Indenture.
"Senior Obligations" means all Obligations other than the Subordinated
Obligations, whether such Obligations arise before, during or after the initial
or any renewal term of this Agreement or are amended, restated, modified,
renewed, refunded, refinanced or otherwise replaced in whole or in part, whether
prior to or after the commencement of any Insolvency Proceeding, or arise after
the commencement of any Insolvency Proceeding with respect to the Loan Parties
(and including, without limitation, the payment of interest (including
post-default interest and interest on interest) and fees which would accrue and
become due but for the commencement of such Insolvency Proceeding, expense
reimbursements and indemnities whether or not such interest, fees, expense
reimbursements and indemnities are allowed or allowable in whole or in part in
any such Insolvency Proceeding).
"Senior Term Loan Commitments" means the Term Loan A Commitment, the
Term Loan B Commitment and the Term Loan C Commitment.
"Senior Term Loan Obligations" means the Term Loan A Obligations, the
Term Loan B Obligations and the Term Loan C Obligations.
"Senior Term Loans" means the Term Loan A, the Term Loan B and the Term
Loan C.
"Settlement Period" has the meaning specified therefor in Section
2.02(d)(i) hereof.
"Significant Customers " means Ford Motor Company, General Motors
Corporation and DaimlerChrysler Corporation and their Affiliates.
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"Solvent" means, with respect to any Person on a particular date, that
on such date (i) the fair value of the property of such Person is not less than
the total amount of the liabilities of such Person, (ii) the present fair
salable value of the assets of such Person is not less than the amount that will
be required to pay the probable liability of such Person on its existing debts
as they become absolute and matured, (iii) such Person is able to realize upon
its assets and pay its debts and other liabilities, contingent obligations and
other commitments as they mature in the normal course of business, (iv) such
Person does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person's ability to pay as such debts and liabilities
mature, and (v) such Person is not engaged in business or a transaction, and is
not about to engage in business or a transaction, for which such Person's
property would constitute unreasonably small capital.
"Standard & Poor's" means Standard & Poor's Ratings Services, a
division of The McGraw-Hill Companies, Inc. and any successor thereto.
"Subordinated Indebtedness" means Indebtedness of any Loan Party (other
than the Subordinated Term Loan D) the terms of which are satisfactory to the
Agents and which has been expressly subordinated in right of payment to all
Senior Obligations (i) by the execution and delivery of a subordination
agreement, in form and substance satisfactory to the Agents, or (ii) otherwise
on terms and conditions (including, without limitation, subordination
provisions, payment terms, interest rates, covenants, remedies, defaults and
other material terms) satisfactory to the Agents.
"Subordinated Note Agreement" means the Note Agreement, dated as of
January 15, 1996, as amended, between the Parent and the Purchasers named on
Schedule I thereto.
"Subordinated Notes" means the $40,00,000 12% Senior Subordinated Notes
Due February 1, 2003 governed by the Subordinated Note Agreement.
"Subordinated Obligations" means all Obligations with respect to the
Subordinated Term Loan D (including, without limitation, the principal thereof,
the interest thereon, and the fees and expenses specifically related thereto,
but excluding any fees, expense reimbursement, indemnities and other amounts due
to the Collateral Agent).
"Subordinated Term Loan D" means, collectively, the loans made by the
Subordinated Term Loan D Lenders to the Parent on the Effective Date pursuant to
Section 2.01(a)(v).
"Subordinated Term Loan D Commitments" means, with respect to each
Subordinated Term Loan D Lender, the commitment of such Subordinated Term Loan D
Lender to accept, in partial consideration for the purchase of its Subordinated
Note by the Parent, its Subordinated Term Loan D Note made by the Parent in the
amount set forth in Schedule 1.01(A) hereto.
"Subordinated Term Loan D Event of Default" means the Subordinated Term
D Event of Default as defined in Annex 2.
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"Subordinated Term Loan D Lenders" has the meaning specified therefor
in the preamble hereto.
"Subordinated Term Loan D Maturity Date" means February 28, 2005.
"Subordinated Term Loan D Notes" means each of the Subordinated Term
Loan D Notes, substantially in the form of Exhibit H, issued by the Parent to
each of the Subordinated Term Loan D Lenders in the original principal amount of
such Subordinated Term Loan D Lender's Subordinated Term Loan D Commitment,
which Subordinated Term Loan D Notes shall contain subordination provisions that
are substantially the same as the subordination provisions contained in the
Subordinated Note Agreement and are otherwise acceptable to the Senior Lenders.
"Subsidiary" means, with respect to any Person at any date, any
corporation, limited or general partnership, limited liability company, trust,
estate, association, joint venture or other business entity (i) the accounts of
which would be consolidated with those of such Person in such Person's
consolidated financial statements if such financial statements were prepared in
accordance with GAAP or (ii) of which more than 50% of (A) the outstanding
Capital Stock having (in the absence of contingencies) ordinary voting power to
elect a majority of the board of directors or other managing body of such
Person, (B) in the case of a partnership or limited liability company, the
interest in the capital or profits of such partnership or limited liability
company or (C) in the case of a trust, estate, association, joint venture or
other entity, the beneficial interest in such trust, estate, association or
other entity business is, at the time of determination, owned or controlled
directly or indirectly through one or more intermediaries, by such Person. For
purposes of the Agreement and the other Loan Documents, Haul Insurance shall be
deemed not to be a Subsidiary of the Parent or any other Loan Party.
"Term Loan A" means, collectively, the loans made by the Term Loan A
Lenders to Allied Systems on the Effective Date pursuant to Section 2.01(a)(ii).
"Term Loan A Commitment" means, with respect to each Senior Lender, the
commitment of such Senior Lender to make the Term Loan A to Allied Systems in
the amount set forth in Schedule 1.01(A) hereto, as the same may be terminated
or reduced from time to time in accordance with the terms of this Agreement.
"Term Loan A Lender" means a Senior Lender with a Term Loan A
Commitment.
"Term Loan A Obligations" means any Obligation with respect to the Term
Loan A (including, without limitation, the principal thereof, the interest
thereon, and the fees and expenses specifically related thereto).
"Term Loan B" means, collectively, the loans made by the Term Loan B
Lenders to Allied Systems on the Effective Date pursuant to Section
2.01(a)(iii).
"Term Loan B Commitment" means, with respect to each Senior Lender, the
commitment of such Senior Lender to make the Term Loan B to Allied Systems in
the amount set forth in Schedule 1.01(A) hereto, as the same may be terminated
or reduced from time to time in accordance with the terms of this Agreement.
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"Term Loan B Lender" means a Senior Lender with a Term Loan B
Commitment.
"Term Loan B Obligations" means any Obligation with respect to the Term
Loan B (including, without limitation, the principal thereof, the interest
thereon including all capitalized interest, and the fees and expenses
specifically related thereto).
"Term Loan C" means, collectively, the loans made by the Term Loan C
Lenders to Allied Systems on the Effective Date pursuant to Section 2.01(a)(iv).
"Term Loan C Fee" has the meaning specified in Section 2.06(c).
"Term Loan C Commitment" means, with respect to each Senior Lender, the
commitment of such Senior Lender to make the Term Loan C to Allied Systems in
the amount set forth in Schedule 1.01(A) hereto, as the same may be terminated
or reduced from time to time in accordance with the terms of this Agreement.
"Term Loan C Lender" means a Senior Lender with a Term Loan C
Commitment.
"Term Loan C Obligations" means any Obligation with respect to the Term
Loan C (including, without limitation, the principal thereof (including the
principal proceeds of which are used to pay the Term Loan C Fee), the interest
thereon including all capitalized interest, and the fees and expenses
specifically related thereto).
"Termination Event" means (i) a Reportable Event with respect to any
Employee Plan that would reasonably be expected to have a Material Adverse
Effect, (ii) any event that causes any Loan Party or any of its ERISA Affiliates
to incur liability under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064,
4069, 4201, 4204 or 4212 of ERISA or Section 4971 or 4975 of the Internal
Revenue Code that would reasonably be expected to have a Material Adverse
Effect, (iii) the filing of a notice of intent to terminate an Employee Plan or
the treatment of an Employee Plan amendment as a termination under Section 4041
of ERISA, (iv) the institution of proceedings by the PBGC to terminate an
Employee Plan, or (v) any other event or condition which might reasonably be
expected to constitute grounds under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Employee Plan.
"Title Insurance Policy" means a mortgagee's loan policy, in form and
substance satisfactory to the Collateral Agent, together with all endorsements
made from time to time thereto, issued by or on behalf of a title insurance
company satisfactory to the Collateral Agent, insuring the Lien created by a
Mortgage in an amount and on terms satisfactory to the Collateral Agent,
delivered to the Collateral Agent.
"Total Commitment" means the sum of the Total Revolving Credit
Commitment, the Total Term Loan Commitment and the Total Subordinated Term Loan
D Commitment.
"Total Enterprise Value" means the business or enterprise value of the
Designated Loan Parties as determined by an independent third party appraiser
acceptable to the Collateral Agent.
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"Total Revolving Credit Commitment" means the sum of the amounts of the
Senior Lenders' Revolving Credit Commitments.
"Total Subordinated Term Loan D Commitment" means the sum of the
amounts of the Subordinated Term Loan D Lenders' Subordinated Term Loan D
Commitments.
"Total Term Loan A Commitment" means the sum of the amounts of the
Senior Lenders' Term Loan A Commitments.
"Total Term Loan B Commitment" means the sum of the amounts of the
Senior Lenders' Term Loan B Commitments.
"Total Term Loan C Commitment" means the sum of the amounts of the
Senior Lenders' Term Loan C Commitments.
"Total Term Loan Commitment" means the Total Term Loan A Commitment,
the Total Term Loan B Commitment and the Total Term Loan C Commitment.
"UCC Filing Authorization Letter" means a letter duly executed by each
Loan Party authorizing the Collateral Agent to file appropriate financing
statements on Form UCC-1 without the signature of such Loan Party in such office
or offices as may be necessary or, in the reasonable business judgment of the
Collateral Agent, desirable to perfect the security interests purported to be
created by each Security Agreement, each Pledge Agreement and each Mortgage.
"Uniform Commercial Code" has the meaning specified therefor in Section
1.03.
"Unused Line Fee" has the meaning specified therefor in Section
2.06(a).
"WARN" has the meaning specified therefor in Section 6.01(i).
Section 1.02 Terms Generally. The definitions of terms herein
shall apply equally to the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
The word "will" shall be construed to have the same meaning and effect as the
word "shall". Unless the context requires otherwise, (a) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person shall be construed to include such
Person's successors and assigns, (c) the words "herein", "hereof" and
"hereunder", and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement and (e) the words "asset" and "property" shall be construed to
have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and
contract rights. References in this Agreement to "determination" by any Agent
include good faith estimates
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by such Agent (in the case of quantitative determinations) and good faith
beliefs by such Agent (in the case of qualitative determinations).
Section 1.03 Accounting and Other Terms. Unless otherwise
expressly provided herein, each accounting term used herein shall have the
meaning given it under GAAP applied on a basis consistent with those used in
preparing the Financial Statements. All terms used in this Agreement which are
defined in Article 8 or Article 9 of the Uniform Commercial Code as in effect
from time to time in the State of New York (the "Uniform Commercial Code") and
which are not otherwise defined herein shall have the same meanings herein as
set forth therein; provided that terms used herein which are defined in the
Uniform Commercial Code as in effect in the State of New York on the date hereof
shall continue to have the same meaning notwithstanding any replacement or
amendment of such statute except as any Agent may otherwise determine.
Section 1.04 Time References. Unless otherwise indicated herein,
all references to time of day refer to Eastern Standard Time or Eastern daylight
saving time, as in effect in New York City on such day. For purposes of the
computation of a period of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
means "to but excluding"; provided, however, that with respect to a computation
of fees or interest payable to any Agent, any Lender or the L/C Issuer, such
period shall in any event consist of at least one full day.
ARTICLE II
THE LOANS
Section 2.01 Commitments. (a) Subject to the terms and conditions
and relying upon the representations and warranties herein set forth:
(i) each Revolving Loan Lender severally agrees
to make Revolving Loans to Allied Systems at any time and from time to time from
the Effective Date to the Final Senior Loan Maturity Date, or until the earlier
reduction of its Revolving Credit Commitment to zero in accordance with the
terms hereof, in an aggregate principal amount of Revolving Loans at any time
outstanding not to exceed the amount of such Senior Lender's Revolving Credit
Commitment;
(ii) each Term Loan A Lender severally agrees to
make the Term Loan A to Allied Systems on the Effective Date, in an aggregate
principal amount not to exceed the amount of such Senior Lender's Term Loan A
Commitment;
(iii) each Term Loan B Lender severally agrees to
make the Term Loan B to Allied Systems on the Effective Date, in an aggregate
principal amount not to exceed the amount of such Senior Lender's Term Loan B
Commitment;
(iv) each Term Loan C Lender severally agrees to
make the Term Loan C to Allied Systems on the Effective Date, in an aggregate
principal amount not to exceed the amount of such Senior Lender's Term Loan C
Commitment; and
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(v) each Subordinated Term Loan D Lender
severally agrees to accept its Subordinated Note for its Subordinated Term Loan
D Note made by the Parent on the Effective Date as partial consideration for the
purchase of its Subordinated Note, which Subordinated Term Loan D Note shall be
in a principal amount not to exceed the amount of such Subordinated Lender's
Subordinated Term Loan D Commitment.
(b) Notwithstanding the foregoing:
(i) The aggregate principal amount of Revolving
Loans outstanding at any time to Allied Systems shall not exceed the lower of
(A) the difference between (x) the Total Revolving Credit Commitment and (y) the
aggregate Letter of Credit Obligations and (B) the difference between (x) the
then current Borrowing Base and (y) the aggregate Letter of Credit Obligations.
The Revolving Credit Commitment of each Senior Lender shall automatically and
permanently be reduced to zero on the Final Senior Loan Maturity Date. Within
the foregoing limits, Allied Systems may borrow, repay and reborrow, on or after
the Effective Date and prior to the Final Senior Loan Maturity Date, subject to
the terms, provisions and limitations set forth herein.
(ii) (A) The aggregate principal amount of
the Term Loan A made on the Effective Date shall not exceed the Total Term Loan
A Commitment.
(B) The aggregate principal amount of
the Term Loan B made on the Effective Date shall not exceed the Total Term Loan
B Commitment.
(C) The aggregate principal amount of
the Term Loan C made on the Effective Date shall not exceed the Total Term Loan
C Commitment.
(D) The aggregate principal amount of
the Subordinated Term Loan D Notes on the Effective Date shall not exceed the
Total Subordinated Term Loan D Commitment.
(iii) Any principal amount of the Senior Term
Loans and the Subordinated Term Loan D which is repaid or prepaid may not be
reborrowed.
(iv) The aggregate principal amount of the Senior
Loans and Letter of Credit Obligations shall not at any time exceed (A) an
amount equal to (x) three (3) multiplied by (y) the Consolidated EBITDA of the
Parent and its Subsidiaries for the most recently completed twelve months after
giving effect, if any, to the pro forma adjustments set forth in Schedule
2.01(b)(iv) or (B) the maximum principal amount of Indebtedness which is
permitted to be incurred by the Parent and its Subsidiaries under clause (i) of
the second paragraph of Section 4.09 of the Indenture less the sum of (x) all
outstanding Capital Lease Obligations (as defined in the Indenture) incurred
under such clause (i) and (y) the outstanding principal amount of the
Subordinated Term Loan D.
Section 2.02 Making the Loans. (i) The Administrative Borrower
shall give the Administrative Agent prior telephonic notice (immediately
confirmed in writing, in substantially the form of Exhibit D hereto (a "Notice
of Borrowing")), not later than 12:00 noon (New York City time) on the date
which is five (5) Business Days prior to the date of the proposed
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Loan (or such shorter period as the Administrative Agent is willing to
accommodate from time to time, provided, that such Notice of Borrowing shall be
received by the Administrative Agent, (x) in the case of a borrowing consisting
of a Reference Rate Loan, not later than 12:00 noon (New York City time) on the
borrowing date of the proposed Reference Rate Loan, and (y) in the case of a
borrowing consisting of LIBOR Rate Loans, not later than 12:00 noon (New York
City time) on a date that is three (3) Business Days prior to the proposed
borrowing). Such Notice of Borrowing shall be irrevocable and shall specify (A)
the principal amount of the proposed Loan (which, in the case of a LIBOR Rate
Loan, must be in a minimum amount of $1,000,000 and in integral multiples of
$500,000 in excess thereof), (B) in the case of a Revolving Loan, whether such
Loan is requested to be a Reference Rate Loan or a LIBOR Rate Loan and, in the
case of a LIBOR Rate Loan, the initial Interest Period with respect thereto, (C)
in the case of Loans requested on the Effective Date, whether such Loan is
requested to be a Revolving Loan, the Term Loan A, the Term Loan B or the Term
Loan C, (D) the use of the proceeds of such proposed Loan (which, in the case of
the Term Loan C, must be used to repay, in part, the Subordinated Notes and to
pay the Term Loan C Fee), and (E) the proposed borrowing date, which must be a
Business Day, and, with respect to the Term Loan A, the Term Loan B and the Term
Loan C must be the Effective Date. The Administrative Agent and the Senior
Lenders may act without liability upon the basis of written, telecopied or
telephonic notice believed by the Administrative Agent in good faith to be from
Allied Systems (or from any Authorized Officer thereof designated in writing
purportedly from the Allied Systems to the Administrative Agent). Allied Systems
hereby waives the right to dispute the Administrative Agent's record of the
terms of any such telephonic Notice of Borrowing. The Administrative Agent and
each Senior Lender shall be entitled to rely conclusively on any Authorized
Officer's authority to request a Senior Loan on behalf of Allied Systems until
the Administrative Agent receives written notice to the contrary. The
Administrative Agent and the Senior Lenders shall have no duty to verify the
authenticity of the signature appearing on any written Notice of Borrowing.
(ii) On the Effective Date, the Parent agrees to
issue to each Subordinated Term Loan D Lender as partial consideration for the
purchase of the Subordinated Note of such Subordinated Term Loan D Lender, and
such Subordinated Term Loan D Lender agrees to accept a Subordinated Term Loan D
Note in the principal amount equal to such Subordinated Lender's Subordinated
Term Loan D Commitment as partial consideration for the purchase of its
Subordinated Note. The exchange of the Subordinated Notes for the Subordinated
Term Loan D Notes will be made at the offices of Schulte Roth & Zabel LLP, 919
Third Avenue, New York, New York on the Effective Date. The Subordinated Term
Loan D Notes delivered to each Subordinated Lender on the Effective Date will be
delivered to such Subordinated Lender in the form of a registered Subordinated
Term Loan D Note in the amount of such Subordinated Lender's Subordinated Term
Loan D Commitment (unless different denominations are specified by such
Subordinated Lender), registered in such Subordinated Lender's name or in the
name of such Subordinated Lender's nominee, all as such Subordinated Lender may
specify at any time prior to the Effective Date.
(b) Each Notice of Borrowing pursuant to Section
2.02(a)(i) shall be irrevocable and Allied Systems shall be bound to make a
borrowing in accordance therewith. Each Revolving Loan that is a LIBOR Rate Loan
shall be made in a minimum amount of $1,000,000 and in integral multiples of
$500,000 in excess thereof. No more than five (5) Interest Periods in the
aggregate for Allied Systems may exist at any one time.
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(c) (i) Except as otherwise provided in this
subsection 2.02(c), all Senior Loans under this Agreement shall be made by the
Senior Lenders simultaneously and proportionately to their Pro Rata Shares of
the Total Revolving Credit Commitment and the Total Term Loan Commitments, as
the case may be, it being understood that no Senior Lender shall be responsible
for any default by any other Senior Lender in that other Senior Lender's
obligations to make a Senior Loan requested hereunder, nor shall the Commitment
of any Senior Lender be increased or decreased as a result of the default by any
other Senior Lender in that other Senior Lender's obligation to make a Senior
Loan requested hereunder, and each Senior Lender shall be obligated to make the
Senior Loans required to be made by it by the terms of this Agreement regardless
of the failure by any other Senior Lender.
(ii) Notwithstanding any other provision of this
Agreement, and in order to reduce the number of fund transfers among Allied
Systems, the Agents and the Senior Lenders, Allied Systems, the Agents and the
Senior Lenders agree that the Administrative Agent may (but shall not be
obligated to), and Allied Systems and the Senior Lenders hereby irrevocably
authorize the Administrative Agent to, fund, on behalf of the Senior Lenders
with a Revolving Loan Commitment, Revolving Loans pursuant to Section 2.01,
subject to the procedures for settlement set forth in subsection 2.02(d);
provided, however, that (a) the Administrative Agent shall in no event fund any
such Revolving Loans if the Administrative Agent shall have received written
notice from the Collateral Agent or the Required Lenders on the Business Day
prior to the date of the proposed Revolving Loan that one or more of the
conditions precedent contained in Section 5.02 will not be satisfied at the time
of the proposed Revolving Loan, and (b) the Administrative Agent shall not
otherwise be required to determine that, or take notice whether, the conditions
precedent in Section 5.02 have been satisfied. If either (x) Allied Systems
gives a Notice of Borrowing requesting a Revolving Loan that is a LIBOR Rate
Loan or (y) the Administrative Agent elects not to fund a requested Revolving
Loan that is a Reference Rate Loan on behalf of such Revolving Loan Lenders,
then promptly after receipt of the Notice of Borrowing requesting such Revolving
Loan, the Administrative Agent shall notify each Revolving Loan Lender of the
specifics of the requested Revolving Loan and that it will not fund the
requested Revolving Loan on behalf of the Revolving Loan Lenders. If the
Administrative Agent notifies the Revolving Loan Lenders that it will not fund a
requested Revolving Loan on behalf of the Revolving Loan Lenders, each Revolving
Loan Lender shall make its Pro Rata Share of the Revolving Loan available to the
Administrative Agent, in immediately available funds, in the Administrative
Agent's Account no later than 3:00 p.m. (New York City time) (provided that the
Administrative Agent requests payment from such Revolving Loan Lender not later
than 1:00 p.m.) on the date of the proposed Revolving Loan. The Administrative
Agent will make the proceeds of such Revolving Loans available to Allied Systems
on the day of the proposed Revolving Loan by causing an amount, in immediately
available funds, equal to the proceeds of all such Revolving Loans received by
the Administrative Agent in the Administrative Agent's Account or the amount
funded by the Administrative Agent on behalf of the Revolving Loan Lenders to be
deposited in an account designated by Allied Systems.
(iii) If the Administrative Agent has notified the
Revolving Loan Lenders that the Administrative Agent, on behalf of such
Revolving Loan Lenders, will fund a particular Revolving Loan pursuant to
subsection 2.02(c)(ii), the Administrative Agent may assume that each Revolving
Loan Lender has made such amount available to the
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Administrative Agent on such day and the Administrative Agent, in its sole
discretion, may, but shall not be obligated to, cause a corresponding amount to
be made available to Allied Systems on such day. If the Administrative Agent
makes such corresponding amount available to Allied Systems and such
corresponding amount is not in fact made available to the Administrative Agent
by any Revolving Loan Lender, such Revolving Loan Lender and the Administrative
Agent shall be entitled to recover such corresponding amount on demand from such
Revolving Loan Lender together with interest thereon, for each day from the date
such payment was due until the date such amount is paid to the Administrative
Agent, at the Federal Funds Rate for three Business Days and thereafter at the
rate applicable to such Revolving Loan. During the period in which such
Revolving Loan Lender has not paid such corresponding amount to the
Administrative Agent, notwithstanding anything to the contrary contained in this
Agreement or any other Loan Document, the amount so advanced by the
Administrative Agent to Allied Systems shall, for all purposes hereof, be a
Revolving Loan made by the Administrative Agent for its own account. Upon any
such failure by a Revolving Loan Lender to pay the Administrative Agent, the
Administrative Agent may immediately charge the Loan Account for such amount. In
the event that the Administrative Agent does not charge the Loan Account, Allied
Systems shall, upon demand by the Administrative Agent, repay such amount to the
Administrative Agent for its own account.
(iv) Nothing in this subsection 2.02(c) shall be
deemed to relieve any Revolving Loan Lender from its obligations to fulfill its
Revolving Credit Commitment hereunder or to prejudice any rights that the
Administrative Agent or Allied Systems may have against any Revolving Loan
Lender as a result of any default by such Revolving Loan Lender hereunder.
(d) (i) With respect to each LIBOR Rate Loan, on the
first and the last date of each Interest Period, and with respect to all periods
for which the Administrative Agent, on behalf of the Revolving Loan Lenders, has
funded Revolving Loans that are Reference Rate Loans pursuant to subsection
2.02(c), on Friday of each week, or if the applicable Friday is not a Business
Day, then on the following Business Day, or such shorter period as the
Administrative Agent may from time to time select (any such week or shorter
period being herein called a "Settlement Period"), the Administrative Agent
shall notify each Revolving Loan Lender of the unpaid principal amount of the
Revolving Loans outstanding as of the last day of each such Settlement Period.
In the event that such amount is greater than the unpaid principal amount of the
Revolving Loans outstanding on the last day of the Settlement Period immediately
preceding such Settlement Period (or, if there has been no preceding Settlement
Period, the amount of the Revolving Loans made on the date of such Revolving
Loan Lender's initial funding), each Revolving Loan Lender shall promptly (and
in any event not later than 2:00 p.m. (New York City time) if the Administrative
Agent requests payment from such Lender not later than 12:00 noon (New York City
time) on such day) make available to the Administrative Agent its Pro Rata Share
of the difference in immediately available funds. In the event that such amount
is less than such unpaid principal amount, the Administrative Agent shall
promptly pay over to each Revolving Loan Lender its Pro Rata Share of the
difference in immediately available funds. In addition, if the Administrative
Agent shall so request at any time when a Default or an Event of Default shall
have occurred and be continuing, or any other event shall have occurred as a
result of which the Administrative Agent shall determine that it is desirable to
present claims against Allied Systems for repayment, each Revolving Loan Lender
shall
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promptly remit to the Administrative Agent or, as the case may be, the
Administrative Agent shall promptly remit to each Revolving Loan Lender,
sufficient funds to adjust the interests of the Revolving Loan Lenders in the
then outstanding Revolving Loans to such an extent that, after giving effect to
such adjustment, each such Revolving Loan Lender's interest in the then
outstanding Revolving Loans will be equal to its Pro Rata Share thereof. The
obligations of the Administrative Agent and each Revolving Loan Lender under
this subsection 2.02(d) shall be absolute and unconditional. Each Revolving Loan
Lender shall only be entitled to receive interest on its Pro Rata Share of the
Revolving Loans which have been funded by such Revolving Loan Lender.
(ii) In the event that any Revolving Loan Lender
fails to make any payment required to be made by it pursuant to subsection
2.02(d)(i), the Administrative Agent shall be entitled to recover such
corresponding amount on demand from such Revolving Loan Lender together with
interest thereon, for each day from the date such payment was due until the date
such amount is paid to the Administrative Agent, at the Federal Funds Rate for
three Business Days and thereafter at the rate applicable to such Revolving
Loan. During the period in which such Revolving Loan Lender has not paid such
corresponding amount to the Administrative Agent, notwithstanding anything to
the contrary contained in this Agreement or any other Loan Document, the amount
so advanced by the Administrative Agent to Allied Systems shall, for all
purposes hereof, be a Revolving Loan made by the Administrative Agent for its
own account. Upon any such failure by a Revolving Loan Lender to pay the
Administrative Agent, the Administrative Agent may immediately charge the Loan
Account for such amount. In the event that the Administrative does not charge
the Loan Account, Allied Systems shall, upon demand by the Administrative Agent,
pay such corresponding amount to the Administrative Agent for its own account.
Nothing in this subsection 2.02(d)(ii) shall be deemed to relieve any Revolving
Loan Lender from its obligation to fulfill its Revolving Credit Commitment
hereunder or to prejudice any rights that the Administrative Agent or Allied
Systems may have against any Revolving Loan Lender as a result of any default by
such Revolving Loan Lender hereunder.
Section 2.03 Repayment of Loans; Evidence of Debt. (a) The outstanding
principal of all Revolving Loans shall be due and payable on the Final Senior
Loan Maturity Date.
(b) (i) The outstanding principal of the Term Loan
A shall be repayable in quarterly installments, on the last day of each January,
April, July and October commencing on April 30, 2002 and ending on the Final
Senior Loan Maturity Date, consisting of (A) eleven (11) installments, each in
an amount equal to $875,000, followed by (B) one (1) installment, in the amount
equal to $7,875,000; provided, however, that the last such installment shall be
in the amount necessary to repay in full the unpaid principal amount of the Term
Loan A.
(ii) The outstanding principal of the Term Loan B
shall be repayable in quarterly installments, on the last day of each January,
April, July and October commencing on October 31, 2003 and ending on the Final
Senior Loan Maturity Date, consisting of (A) five (5) installments, each in an
amount equal to $2,500,000, followed by (B) one (1) installment, in the amount
equal to $12,500,000, provided, however, that the last such
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installment shall be in the amount necessary to repay in full the unpaid
principal amount of the Term Loan B.
(iii) The outstanding principal of the Term Loan C
shall be repaid in full on the Final Senior Loan Maturity Date.
(iv) The outstanding principal of the
Subordinated Term Loan D shall be repaid in full on the Subordinated Term Loan D
Maturity Date.
(c) Each Senior Lender shall maintain in accordance with
its usual practice an account or accounts evidencing the Indebtedness of Allied
Systems to such Senior Lender resulting from each Senior Loan made by such
Senior Lender, including the amounts of principal and interest payable and paid
to such Senior Lender from time to time hereunder.
(d) The Administrative Agent shall maintain accounts in
which it shall record (i) the amount of each Senior Loan made hereunder, (ii)
the amount of any principal or interest due and payable or to become due and
payable from Allied Systems to each Senior Lender hereunder and (iii) the amount
of any sum received by the Administrative Agent hereunder for the account of the
Senior Lenders and each Senior Lender's share thereof.
(e) The entries made in the accounts maintained pursuant
to paragraph (c) or (d) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any Senior Lender or the Administrative Agent to maintain such
accounts or any error therein shall not in any manner affect the obligation of
Allied Systems to repay the Senior Loans in accordance with the terms of this
Agreement.
(f) Any Senior Lender may request that Senior Loans made
by it be evidenced by a promissory note. In such event, Allied Systems shall
execute and deliver to such Senior Lender a promissory note payable to the order
of such Senior Lender (or, if requested by such Senior Lender, to such Senior
Lender and its registered assigns) in a form furnished by the Collateral Agent
and reasonably acceptable to Allied Systems. Thereafter, the Senior Loans
evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 12.07) be represented by one or
more promissory notes in such form payable to the order of the payee named
therein (or, if such promissory note is a registered note, to such payee and its
registered assigns).
Section 2.04 Interest. (a) Revolving Loans. Subject to the terms
of this Agreement, at the option of the Administrative Borrower, each Revolving
Loan shall be either a Reference Rate Loan or a LIBOR Rate Loan. Each Revolving
Loan that is a Reference Rate Loan shall bear interest on the principal amount
thereof from time to time outstanding from the date of such Loan until such
principal amount becomes due, at a rate per annum equal to the greater of (x)
the Reference Rate plus 1.50% and (y) 6.50%. Each Revolving Loan that is a LIBOR
Rate Loan shall bear interest on the principal amount thereof from time to time
outstanding, from the date of such Loan until such principal amount becomes due,
at a rate per annum equal to the greater of (x) LIBOR for the Interest Period in
effect for such Revolving Loan plus 4.50% and (y) 6.50%.
(b) Term Loans. The Term Loan A shall bear interest on
the principal amount thereof from time to time outstanding, from the date of the
Term Loan A until
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such principal amount becomes due, at a rate per annum equal the greater of (x)
the Reference Rate plus 2.75% and (y) 7.75%.
(ii) The Term Loan B shall bear interest on the
principal amount thereof from time to time outstanding, from the date of the
Term Loan A until such principal amount become due, at a rate per annum equal to
the greater of (x) the Reference Rate plus 6.50% and (y) 11.50%, provided that,
so long as no Event of Default has occurred and is continuing, a portion of the
interest on the Term Loan B equal to 3.50% per annum that has accrued during
such period shall be capitalized on such interest payment date and added to the
outstanding principal amount of the Term Loan B and the interest otherwise
payable in cash shall be reduced by the amount of interest so capitalized. For
purposes of this Agreement and the other Loan Documents, the amounts so
capitalized hereunder shall bear interest in accordance with this Section
2.04(b)(ii) as though such amounts constituted a Term Loan B made by the Term
Loan B Lenders to Allied Systems.
(iii) The Term Loan C shall bear interest on the
principal amount thereof from time to time outstanding, from the date of the
Term Loan C until such principal amount become due, at a rate per annum equal to
the greater of (x) the Reference Rate plus 9.0% and (y) 14.0%, provided that, so
long as no Event of Default has occurred and is continuing, a portion of the
interest on the Term Loan C equal to 5.0% per annum that has accrued during such
period shall be capitalized on such interest payment date and added to the
outstanding principal amount of the Term Loan C and the interest otherwise
payable in cash shall be reduced by the amount of interest so capitalized. For
purposes of this Agreement and the other Loan Documents, the amounts so
capitalized hereunder shall bear interest in accordance with this Section
2.04(b)(iii) as though such amounts constituted a Term Loan C made by the Term
Loan C Lenders to Allied Systems.
(iv) The Subordinated Term Loan D shall bear
interest on the principal amount thereof from time to time outstanding, from the
date of the issuance of Subordinated Term Loan D Notes until such principal
amount becomes due, at a rate per annum equal to the Reference Rate plus 3.50%.
(c) Default Interest. (i) To the extent permitted by law,
upon the occurrence and during the continuance of an Event of Default, the
principal of, and all accrued and unpaid interest on, all Senior Loans and all
other Senior Obligations, including, without limitation, fees, indemnities and
outstanding Reimbursement Obligations, shall bear interest, from the date such
Event of Default occurred until the date such Event of Default is cured or
waived in writing in accordance herewith, at a rate per annum equal at all times
to the Post-Default Rate applicable to the applicable Senior Obligations.
(ii) To the extent permitted by law, upon the
occurrence and during the continuance of a Subordinated Term Loan D Event of
Default, the principal of, and all accrued and unpaid interest on, the
Subordinated Term Loan D and all other Subordinated Obligations, including,
without limitation, fees and indemnities, shall bear interest, from the date
such Term Loan D Event of Default occurred until the date such Subordinated Term
Loan D Event of Default is cured or waived in writing in accordance herewith, at
the Post-Default Rate applicable to the Subordinated Obligations.
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(d) Interest Payment. (i) Interest on each Senior Loan
shall be payable monthly, in arrears, on the first day of each month, commencing
on the first day of the month following the month in which such Senior Loan is
made and at maturity (whether upon demand, by acceleration or otherwise).
Interest at the Post-Default Rate shall be payable on demand. Each Borrower
hereby authorizes the Administrative Agent to, and the Administrative Agent may,
from time to time, charge the Loan Account pursuant to Section 4.02 with the
amount of any interest payment due hereunder with respect to the Senior
Obligations.
(ii) Interest on each Subordinated Term Loan D
shall be payable in arrears on the first day of February, May, August and
November of each year.
(e) General. All interest shall be computed on the basis
of a year of 360 days for the actual number of days, including the first day but
excluding the last day, elapsed.
Section 2.05 Reduction of Commitment; Prepayment of Loans.
(a) Reduction of Commitments.
(i) Revolving Credit Commitments. The Total
Revolving Credit Commitment shall terminate on the Final Senior Loan Maturity
Date. Subject to Section 2.06(b), Allied Systems may, without premium or
penalty, reduce the Total Revolving Credit Commitment to an amount (which may be
zero) not less than the sum of (A) the aggregate unpaid principal amount of all
Revolving Loans then outstanding, (B) the aggregate principal amount of all
Revolving Loans not yet made as to which a Notice of Borrowing has been given by
the Administrative Borrower under Section 2.02, (C) the Letter of Credit
Obligations at such time and (D) the stated amount of all Letters of Credit not
yet issued as to which a request has been made and not withdrawn. Each such
reduction shall be in an amount which is an integral multiple of $1,000,000
(unless the Total Revolving Credit Commitment in effect immediately prior to
such reduction is less than $1,000,000), shall be made by providing not less
than five (5) Business Days' prior written notice to the Administrative Agent
and shall be irrevocable. Once reduced, the Total Revolving Credit Commitment
may not be increased. Each such reduction of the Total Revolving Credit
Commitment shall reduce the Revolving Credit Commitment of each Revolving Loan
Lender proportionately in accordance with its Pro Rata Share thereof.
(ii) Term Loans. The Total Term Loan A
Commitment, the Total Term Loan B Commitment, the Term Loan C Commitment and the
Subordinated Term Loan D Commitment shall terminate at 5:00 p.m. (New York City
time) on the Effective Date.
(b) Optional Prepayment.
(i) Revolving Loans. Subject to Section 2.06(b),
Allied Systems may prepay without penalty or premium the principal of any
Revolving Loan, in whole or in part.
(ii) Senior Term Loans. Subject to Section
2.06(b) and after the first anniversary of the Effective Date, Allied Systems
may, upon at least five (5) Business Days' prior written notice to the Agents,
prepay without penalty or premium the principal of the
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Term Loan A, the Term Loan B or the Term Loan C, in whole or in part, if,
immediately after giving effect to such prepayment, Availability is greater than
$15,000,000. Each prepayment made pursuant to this clause (b)(ii) shall be
accompanied by the payment of accrued interest to the date of such payment on
the amount prepaid. Each such prepayment shall be applied against the remaining
installments of principal due on the Senior Term Loans in the inverse order of
maturity.
(iii) Subordinated Term Loan D. Except as
otherwise set forth in Section 2.05(d)(iii), Section 2.05(d)(iv) and Section
2.05(d)(vi), the Parent may not prepay the Subordinated Term Loan D prior to the
Senior Facility Termination Date.
(c) Mandatory Prepayment.
(i) Allied Systems will, upon demand by the
Administrative Agent (which demand may be made by the Administrative Agent or be
required to be made at the request of the Required Lenders or the Required
Revolving Lenders), immediately prepay the Revolving Loans at any time when the
aggregate principal amount of all Revolving Loans plus the outstanding amount of
all Letter of Credit Obligations exceeds the Borrowing Base, to the full extent
of any such excess. On each day that any Revolving Loans or Letter of Credit
Obligations are outstanding, Allied Systems shall hereby be deemed to represent
and warrant to the Agents and the Senior Lenders that the Borrowing Base
calculated as of such day equals or exceeds the aggregate principal amount of
all Revolving Loans and Letter of Credit Obligations outstanding on such day. If
at any time after Allied Systems shall have complied with the first sentence of
this Section 2.05(c)(i), the aggregate Letter of Credit Obligations is greater
than the then current Borrowing Base, Allied Systems shall provide cash
collateral to the Administrative Agent in an amount equal to 110% of such
excess, which cash collateral shall be deposited in the Letter of Credit
Collateral Account and, provided that no Event of Default shall have occurred
and be continuing, returned to Allied Systems, at such time as the aggregate
Letter of Credit Obligations plus the aggregate principal amount of all
outstanding Revolving Loans no longer exceeds the then current Borrowing Base.
(ii) Allied Systems will immediately prepay the
outstanding principal amount of the Senior Term Loans in the event that the
Total Revolving Credit Commitment is terminated for any reason.
(iii) The Administrative Agent shall on each
Business Day apply all funds transferred to or deposited in the Administrative
Agent's Account, to the payment, in whole or in part, of the outstanding
principal amount of the Revolving Loans.
(iv) Within ten (10) days of delivery to the
Agents and the Senior Lenders of audited annual financial statements pursuant to
Section 7.01(a)(ii), commencing with the delivery to the Agents and the Senior
Lenders of the financial statements for the Fiscal Year ended December 31, 2002
or, if such financial statements are not delivered to the Agents and the Senior
Lenders on the date such statements are required to be delivered pursuant to
Section 7.01(a)(ii), ten (10) days after the date such statements are required
to be delivered to the Agents and the Senior Lenders pursuant to Section
7.01(a)(ii), Allied Systems shall prepay the outstanding principal amount of the
Senior Loans in an amount equal to 50% of the Excess Cash Flow of the
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Parent and its Subsidiaries for such Fiscal Year, provided, however, that (A)
for the Fiscal Year ended December 31, 2002, the amount of Excess Cash Flow that
will be applied to repay the Senior Loans shall be equal to (x) 50% of the
Excess Cash Flow of the Parent and its Subsidiaries for such Fiscal Year
multiplied by (y) a fraction (1) the numerator of which is equal to the number
days from the Effective Date until December 31, 2002 and (2) the denominator of
which is equal to 360 and (B) any payments required to be made under this
paragraph (c)(iv) shall be applied as set forth in Section 2.05(d).
Notwithstanding the foregoing provisions, if the excess of (AA) the Borrowing
Base over (BB) the sum of the aggregate outstanding principal amount of all
Revolving Loans and all Letter of Credit Obligations would be less than
$15,000,000 immediately after giving effect to any prepayment required under
this paragraph (c)(iv) (the amount by which such excess is less than
$15,000,000, the "Availability Deficiency"), Allied Systems shall not be
required to make any prepayment required under this paragraph (c)(iv) to the
extent such payment results in an Availability Deficiency and the Administrative
Agent shall establish a reserve against the Borrowing Base in an amount equal to
the amount that would have otherwise been payable by Allied Systems pursuant to
this paragraph (c)(iv), with such prepayment amounts to be paid and such
corresponding amount of the Borrowing Base reserve to be reduced from time to
time if, immediately after giving effect thereto, no Availability Deficiency
would exist.
(v) Within one (1) Business Day following any
Disposition (other than a Disposition of the Capital Stock or assets of any Axis
Entity) by any Loan Party or its Subsidiaries pursuant to Section 7.02(c)(ii),
the Borrowers shall prepay the outstanding principal amount of the Senior Loans
in an amount equal to 100% of the Net Cash Proceeds received by such Person in
connection with such Disposition to the extent that the Net Cash Proceeds
received exceeds (A) $25,000 in any individual Disposition or (B) $1,000,000 in
the aggregate for all Dispositions not paid to the Administrative Agent as a
prepayment of the Senior Loans pursuant to this Section 2.05(a)(v). Within one
(1) Business Day following the Disposition of the Capital Stock or assets of any
Axis Entity by the Parent or any of its Subsidiaries pursuant to Section
7.02(c)(iii), the Borrowers shall prepay the outstanding principal amount of the
Senior Loans in an amount equal to the lesser of (x) 100% of the Net Cash
Proceeds received by the Parent or any of its Subsidiaries in connection with
such Disposition and (y) the difference between (1) $5,000,000 and (2) the
amount of Net Cash Proceeds from prior Dispositions of the Capital Stock or
assets of any Axis Entity applied to repay the outstanding principal amount of
the Senior Loans pursuant to this sentence prior to such date, provided, that
such amount in this clause (2) shall not be less than zero. Nothing contained in
this paragraph (v) shall permit any Loan Party or any of its Subsidiaries to
make a Disposition of any property other than in accordance with Section
7.02(c). Any payments required to be made under this paragraph (v) shall be
applied as set forth in Section 2.05(d).
(vi) Within one (1) Business Day following the
issuance or incurrence by any Loan Party or any of its Subsidiaries of any
Indebtedness (other than Indebtedness referred to in clauses (a), (b), (c), (d),
(e), (g), (h), (i), (j), (k) and (l) of the definition of Permitted
Indebtedness), or the sale or issuance by any Loan Party or any of its
Subsidiaries of any shares of its Capital Stock (other than in connection with
Capital Stock issued pursuant to the Parent's employee stock purchase plans or
long term incentive plans), the Borrowers shall prepay the outstanding amount of
the Senior Loans in an amount equal to 100% of the Net Cash Proceeds received by
such Person in connection therewith. The provisions of
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this paragraph (c)(vi) shall not be deemed to be implied consent to any such
issuance, incurrence or sale otherwise prohibited by the terms and conditions of
this Agreement. Any payments required to be made under this paragraph (c)(vi)
shall be applied as set forth in Section 2.05(d).
(vii) Upon the receipt by any Loan Party or any of
its Subsidiaries of any Extraordinary Receipts in excess of $200,000 in any one
instance or $500,000 in the aggregate, the Borrowers shall prepay the
outstanding principal of the Loans in an amount equal to 100% of such
Extraordinary Receipts, net of any reasonable expenses incurred in collecting
such Extraordinary Receipts. Any payments required to be made under this
paragraph (c)(vii) shall be applied as set forth in Section 2.05(d).
(viii) Simultaneously with the receipt by any Loan
Party or any of its Subsidiaries of any foreign, United States, state or local
tax refund (other than tax refunds received prior to the first anniversary of
the Effective Date) in excess of $200,000 in any one instance or $500,000 in the
aggregate, the Borrowers shall prepay the outstanding amount of the Senior Loans
in an amount equal to 100% of the net proceeds received. Any payments required
to be made under this paragraph (c)(viii) shall be applied as set forth in
Section 2.05(d).
(d) Application of Payments. In the absence of an Event
of Default, the prepayment proceeds shall be applied as follows:
(i) if the proceeds are from any Disposition of
any Account Receivable, Inventory or Rolling Stock or any insurance policy or
condemnation award with respect to Inventory or Rolling Stock, such proceeds
shall be applied to the Revolving Loans until paid in full;
(ii) if the proceeds are from a Disposition of
the Capital Stock or assets of any Axis Entity, such proceeds shall be applied
as follows: the first $5,000,000 in the aggregate from the Effective Date to the
Term Loan A until paid in full and then, the remainder to the Revolving Loans
until paid in full;
(iii) if the proceeds are from any Disposition of
any Facility, any other assets of the Loan Parties not described in clauses (i)
and (ii) above or any life insurance policy issued for the benefit of Parent or
any of its Subsidiaries, such proceeds shall be applied, first, to the Term Loan
A until paid in full, second, to the Term Loan B until paid in full, third, to
the Revolving Loans until paid in full (and if the payment is from the proceeds
of a Disposition of a Facility, the Total Revolving Credit Commitment shall be
reduced by an amount equal to such amount of proceeds applied to the Revolving
Loans hereunder), fourth, to the Term Loan C until paid in full, fifth, to all
other Senior Obligations (including, without limitation, the Prepayment Premium)
until paid in full and sixth, if all Senior Obligations are paid in full and all
of the Senior Commitments have been terminated, to the Subordinated Obligations
until paid in full;
(iv) if the proceeds are from a Disposition of
all or substantially all of the assets or Capital Stock of any Person (other
than proceeds as a result of a Disposition of the Capital Stock or assets of any
Axis Entity) or any insurance which Disposition or proceeds of insurance
includes both (x) Accounts Receivable, Inventory or Rolling Stock and (y) other
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assets, such proceeds shall be applied as follows: (1) an amount equal to the
Net Book Value, or if greater, an amount equal to the amount of Revolving Loans
supported by such assets determined using the effective advance rate under the
Borrowing Base against such Accounts Receivable, Inventory and Rolling Stock
(determined at the time of such Disposition or event resulting in such insurance
proceeds) shall be applied to the Revolving Loans until paid in full and (2) the
remaining proceeds shall be applied first, to the Term Loan A until paid in
full, second, to the Term Loan B until paid in full, third, to the Term Loan C
until paid in full, fourth, to the Revolving Loans until paid in full, fifth, to
all other Senior Obligations (including, without limitation, the Prepayment
Premium) until paid in full and sixth, if all Senior Obligations are paid in
full and all of the Senior Commitments have been terminated, to the Subordinated
Obligations until paid in full;
(v) if the proceeds are from Excess Cash Flow
pursuant to paragraph (c)(iv) above, such proceeds shall be applied, first, to
the Term Loan B until paid in full, second, to the Term Loan C until paid in
full, third, to the Term Loan A until paid in full, fourth, to the Revolving
Loans until paid in full and fifth, to all other Senior Obligations (including,
without limitation, the Prepayment Premium) until paid in full; and
(vi) if the proceeds are from any event set forth
in Section 2.05(c)(vi), (c)(vii) or (c)(viii), such proceeds shall be applied
first, to the Term Loan A until paid in full, second, to the Term Loan B until
paid in full, third, to the Term Loan C until paid in full, fourth, to the
Revolving Loans until paid in full, fifth, to all other Senior Obligations
(including, without limitation, the Prepayment Premium) until paid in full and
sixth, if all of the Senior Obligations are paid in full and all of the Senior
Commitments have been terminated, to the Subordinated Obligations until paid in
full.
Each such prepayment of any Senior Term Loan shall be applied against
the remaining installments of principal of such Senior Term Loan in the inverse
order of maturity.
(e) Interest and Fees. Any prepayment made pursuant to
this Section 2.05 (other than prepayments made pursuant to paragraphs (c)(i) and
(c)(iii) of this Section 2.05) shall be accompanied by accrued interest on the
principal amount being prepaid to the date of prepayment, and if such prepayment
would reduce the amount of the outstanding Senior Loans to zero at a time when
the Total Revolving Credit Commitment has been terminated, such prepayment shall
be accompanied by the payment of all fees accrued to such date pursuant to
Section 2.06.
(f) Cumulative Prepayments. Except as otherwise expressly
provided in this Section 2.05, payments with respect to any subsection of this
Section 2.05 are in addition to payments made or required to be made under any
other subsection of this Section 2.05.
Section 2.06 Fees.
(a) Unused Line Fee. From and after the Effective Date
and until the Final Senior Loan Maturity Date, Allied Systems shall pay to the
Administrative Agent for the account of the Revolving Loan Lenders, in
accordance with a written agreement among such Revolving Loan Lenders, an unused
line fee (the "Unused Line Fee"), which shall accrue at the
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rate per annum of 0.50% on the excess, if any, of the Total Revolving Credit
Commitment over the sum of the average principal amount of all Revolving Loans
and Letter of Credit Obligations outstanding from time to time and shall be
payable monthly in arrears on the first day of each month commencing March 1,
2002.
(b) Early Termination by the Borrowers. If the Total
Revolving Credit Commitment is terminated and all Senior Obligations are paid in
full (the first date on which the Total Revolving Credit Commitment is
terminated and all Senior Obligations are paid in full is hereafter referred to
as the "Senior Facility Termination Date") prior to the third anniversary of the
Effective Date, Allied Systems shall pay to the Administrative Agent for the
account of the Senior Lenders an amount equal to: (i) $1,301,250, if the Senior
Facility Termination Date occurs at any time from the Effective Date until and
including the first anniversary of the Effective Date, (ii) $867,500, if the
Senior Facility Termination Date occurs at any time after the first anniversary
of the Effective Date until and including the second anniversary of the
Effective Date, and (iii) $433,750, if the Senior Facility Termination Date
occurs at any time after the second anniversary of the Effective Date until and
including the day prior to the third anniversary of the Effective Date (such
amount referred to herein as the "Prepayment Premium"). In the event the Senior
Facility Termination Date occurs at any time prior to the third anniversary of
the Effective Date, for any other reason, including, without limitation, (A) as
a result of the occurrence of an Event of Default, (B) foreclosure and sale of
Collateral, (C) sale of the Collateral in any Insolvency Proceeding, or (D)
restructure, reorganization, or compromise of the Senior Obligations by the
confirmation of a plan of reorganization or any other plan of compromise,
restructure, or arrangement in any Insolvency Proceeding, then, Allied Systems
shall pay the Prepayment Premium to the Senior Lenders, measured as of the date
the Senior Facility Termination Date shall occur.
(c) Term Loan C Fee. Allied Systems shall pay to the
Administrative Agent for the account of the Term Loan C Lenders, in accordance
with a written agreement among such Term Loan C Lenders, a non-refundable
funding fee (the "Term Loan C Fee"), equal to $3,000,000 which shall be payable
and deemed fully earned on the Effective Date and such fee shall be capitalized
by adding it to the principal balance of the Term Loan C on the Effective Date.
For purposes of this Agreement and the other Loan Documents, the amounts so
capitalized hereunder shall bear interest in accordance with Section
2.04(b)(iii) and shall for all other purposes of this Agreement constitute a
Term Loan C made by the Term Loan C Lenders to Allied Systems.
(d) Fee Letter Fees. In addition to the fees set forth in
this Agreement, Allied Systems agrees to pay to the
Agents the fees set forth in the Fee Letter in the amounts and on the dates set
forth in the Fee Letter.
Section 2.07 Securitization. The Loan Parties hereby acknowledge
that the Senior Lenders and their Affiliates may sell or securitize the Senior
Loans (a "Securitization") through the pledge of the Senior Loans as collateral
security for loans to the Senior Lenders or their Affiliates or through the sale
of the Senior Loans or the issuance of direct or indirect interests in the
Senior Loans, which loans to the Senior Lenders or their Affiliates or direct or
indirect interests will be rated by Moody's, Standard & Poor's or one or more
other rating agencies (the "Rating Agencies"). The Loan Parties shall cooperate
with the Senior Lenders and their Affiliates to effect
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the Securitization including, without limitation, by (a) amending this Agreement
and the other Loan Documents, and executing such additional documents, as
reasonably requested by the Senior Lenders in connection with the
Securitization, provided that (i) any such amendment or additional documentation
does not impose material additional costs on the Loan Parties and (ii) any such
amendment or additional documentation does not materially adversely affect the
rights, or materially increase the obligations, of the Loan Parties under the
Loan Documents or change or affect in a manner adverse to the Loan Parties the
financial terms of the Senior Loans, (b) providing such information as may be
reasonably requested by the Senior Lenders in connection with the rating of the
Senior Loans or the Securitization, and (c) providing in connection with any
rating of the Senior Loans a certificate (i) agreeing to indemnify the Senior
Lenders and their Affiliates, any of the Rating Agencies, or any party providing
credit support or otherwise participating in the Securitization (collectively,
the "Securitization Parties") for any losses, claims, damages or liabilities
(the "Liabilities") to which the Senior Lenders, their Affiliates or such
Securitization Parties may become subject insofar as the Liabilities arise out
of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in any Loan Document or in any writing delivered by or
on behalf of any Loan Party to the Senior Lenders in connection with any Loan
Document or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein, or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading, and such indemnity shall survive any transfer by
the Senior Lenders or their successors or assigns of the Senior Loans and (ii)
agreeing to reimburse the Senior Lenders and their Affiliates for any legal or
other expenses reasonably incurred by such Persons in connection with defending
the Liabilities.
Section 2.08 Taxes. (a) All payments made with respect to the
Senior Obligations by any Loan Party hereunder or under any other Loan Document
shall be made without set-off, counterclaim, deduction or other defense. All
such payments shall be made free and clear of and without deduction for any
present or future income, franchise, sales, use, excise, stamp or other taxes,
levies, imposts, deductions, charges, fees, withholdings, restrictions or
conditions of any nature now or hereafter imposed, levied, collected, withheld
or assessed by any jurisdiction (whether pursuant to Federal, state, local or
foreign law) or by any political subdivision or taxing authority thereof or
therein, and all interest, penalties or additional amounts, excluding taxes on
the net income of, and branch profit taxes of, any Senior Lender, any Agent or
the L/C Issuer imposed by the jurisdiction in which such Senior Lender, such
Agent or the L/C Issuer is organized or any political subdivision thereof or
taxing authority thereof or any jurisdiction in which such Person's principal
office is located or any political subdivision thereof or taxing authority
thereof (such nonexcluded taxes, levies, imposts, deductions, charges, fees,
withholdings, restrictions, conditions, interest, penalties and additional
amounts being hereinafter collectively referred to as "Taxes"). If any Loan
Party shall be required to deduct or to withhold any Taxes from or in respect of
any amount payable hereunder or under any other Loan Document,
(i) the amount so payable shall be increased so
that after making all required deductions and withholdings (including Taxes on
amounts payable pursuant to this sentence) the Senior Lenders, the Agents or the
L/C Issuer, as the case may be, receive an amount equal to the sum they would
have received had no such deduction or withholding been made,
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(ii) the Loan Parties shall make such deduction
or withholding,
(iii) the Loan Parties shall pay the full amount
deducted or withheld to the relevant taxation authority in accordance with
applicable law, and
(iv) as promptly as possible thereafter, the Loan
Parties shall send the Senior Lenders, the Agents and the L/C Issuer an official
receipt (or, if an official receipt is not available, such other documentation
as shall be satisfactory to the Senior Lenders, the Agents or the L/C Issuer, as
the case may be) evidencing payment of the amounts so deducted or withheld. In
addition, the Loan Parties agree to pay any present or future taxes, charges or
similar levies which arise from any payment made hereunder or from the
execution, delivery, performance, recordation or filing of, or otherwise with
respect to, this Agreement, the Letters of Credit or any other Loan Document
other than the foregoing excluded taxes (hereinafter referred to as "Other
Taxes").
(b) The Loan Parties hereby jointly and severally
indemnify and agree to hold the Senior Lenders, the Agents and the L/C Issuer
harmless from and against Taxes or Other Taxes (including, without limitation,
any Taxes or Other Taxes imposed by any jurisdiction on amounts payable under
this Section 2.08) paid by any Senior Lender, any Agent or the L/C Issuer and
any liability (including penalties, interest and expenses for nonpayment, late
payment or otherwise) arising therefrom or with respect thereto, whether or not
such Taxes or Other Taxes were correctly or legally asserted. Such
indemnification shall be paid within 10 days from the date on which any such
Senior Lender, any such Agent or the L/C Issuer makes written demand therefor,
which demand shall identify in reasonable detail the nature and amount of such
Taxes or Other Taxes.
(c) Each Senior Lender that is organized in a
jurisdiction outside the United States hereby agrees that it shall, no later
than the Effective Date or, in the case of a Senior Lender which becomes a party
hereto pursuant to Section 12.07 hereof after the Effective Date, the date upon
which such Senior Lender becomes a party hereto (and from time to time
thereafter upon the reasonable request of the Administrative Borrower or any
Agent, but only if such Lender is legally able to do so) deliver to the
Administrative Borrower and the Agents either (i) two accurate, complete and
signed copies of either (x) U.S. Internal Revenue Service Form W-8ECI or
successor form, or (y) U.S. Internal Revenue Service Form W-8BEN or successor
form, in each case indicating that such Senior Lender is on the date of delivery
thereof entitled to receive payments of interest hereunder, free from
withholding of United States Federal income tax or (ii) in the case of such a
Senior Lender that is entitled to claim exemption from withholding of United
States Federal income tax under Section 871(h) or Section 881(c) of the Code,
(x) a certificate to the effect that such Senior Lender is (A) not a "bank"
within the meaning of Section 881(c)(3)(A) of the Code, (B) not a "10 percent
shareholder" of any Loan Party within the meaning of Section 881(c)(3)(B) of the
Code and (C) not a controlled foreign corporation receiving interest from a
related person within the meaning of Section 881(c)(3)(C) of the Code and (y)
two accurate, complete and signed copies of U.S. Internal Revenue Service Form
W-8BEN or successor form.
(d) If the Loan Parties fail to perform any of their
obligations under this Section 2.08, the Loan Parties shall indemnify the Senior
Lenders, the Agents and the L/C
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Issuer for any taxes, interest or penalties that may become payable as a result
of any such failure. The obligations of the Loan Parties under this Section 2.08
shall survive the termination of this Agreement and the payment of the Senior
Loans and all other amounts payable hereunder.
Section 2.09 LIBOR Not Determinable; Illegality or Impropriety.
(a) In the event, and on each occasion, that on or before the day on which LIBOR
is to be determined for a borrowing that is to include LIBOR Rate Loans, the
Administrative Agent has determined in good faith that, or has been advised by
the Collateral Agent or the Required Lenders that, (i) LIBOR cannot be
reasonably determined for any reason, (ii) LIBOR will not adequately and fairly
reflect the cost of maintaining LIBOR Rate Loans or (iii) Dollar deposits in the
principal amount of the applicable LIBOR Rate Loans are not available in the
interbank eurodollar market where the eurodollar and foreign currency and
exchange operations in respect of the Revolving Loan Lenders' LIBOR Rate Loans
are then being conducted, the Administrative Agent shall, as soon as practicable
thereafter, give written notice of such determination to the Administrative
Borrower and the other Lenders. In the event of any such determination, any
request by the Administrative Borrower for a LIBOR Rate Loan pursuant to Section
2.02 shall, until, (i) in the case of such a determination by the Collateral
Agent or the Required Lenders, the Administrative Agent has been advised by the
Collateral Agent or the Required Lenders and the Administrative Agent has so
advised the Administrative Borrower that, or (ii) in the case of a determination
by the Administrative Agent, the Administrative Agent has advised the
Administrative Borrower and the other Lenders that, the circumstances giving
rise to such notice no longer exist, be deemed to be a request for a Reference
Rate Loan. Each determination by the Administrative Agent, the Collateral Agent
and/or the Required Lenders hereunder shall be conclusive and binding absent
manifest error.
(b) In the event that it shall be unlawful or improper
for any Revolving Loan Lender to make, maintain or fund any LIBOR Rate Loan as
contemplated by this Agreement, then such Senior Lender shall forthwith give
notice thereof to the Administrative Agent and Allied Systems describing such
illegality or impropriety in reasonable detail. Effective immediately upon the
giving of such notice, the obligation of such Revolving Loan Lender to make
LIBOR Rate Loans shall be suspended for the duration of such illegality or
impropriety and, if and when such illegality or impropriety ceases to exist,
such suspension shall cease, and such Revolving Loan Lender shall notify the
Administrative Agent and Allied Systems. If any such change shall make it
unlawful or improper for any Revolving Loan Lender to maintain any outstanding
LIBOR Rate Loan as a LIBOR Rate Loan, such Revolving Loan Lender shall, upon the
happening of such event, notify the Administrative Agent and Allied Systems, and
Allied Systems shall immediately, or if permitted by applicable law, rule,
regulation, order, decree, interpretation, request or directive, at the end of
the then current Interest Period for such LIBOR Rate Loan, convert each such
LIBOR Rate Loan into a Reference Rate Loan.
Section 2.10 Indemnity. (a) The Loan Parties hereby jointly and
severally indemnifies each Revolving Loan Lender against any loss or expense
that such Revolving Loan Lender actually sustains or incurs (including, without
limitation, any loss or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by such Senior Lender to fund
or maintain any LIBOR Rate Loan, and including loss of anticipated profits) as a
consequence of (i) any failure by the Loan Parties to fulfill on the date of any
borrowing hereunder
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the applicable conditions set forth in Article V, (ii) any failure by Allied
Systems to borrow any LIBOR Rate Loan hereunder, to convert any Reference Rate
Loan into a LIBOR Rate Loan or to continue a LIBOR Rate Loan as such after
notice of such borrowing, conversion or continuation has been given pursuant to
Section 2.02 or 2.11 hereof, (iii) any payment, prepayment (mandatory or
optional) or conversion of a LIBOR Rate Loan required by any provision of this
Agreement or otherwise made on a date other than the last day of the Interest
Period applicable thereto, (iv) any default in payment or prepayment of the
principal amount of any LIBOR Rate Loan or any part thereof or interest accrued
thereon, as and when due and payable (at the due date thereof, by notice of
prepayment or otherwise), or (v) the occurrence of any Event of Default,
including, in each such case, any loss (including, without limitation, loss of
anticipated profits) or reasonable expense sustained or incurred in liquidating
or employing deposits from third parties acquired to effect or maintain such
Loan or any part thereof as a LIBOR Rate Loan. Such loss or reasonable expense
shall include but not be limited to an amount equal to the excess, if any, as
reasonably determined by such Revolving Loan Lender, of (i) its cost of
obtaining the funds for the Loan being paid or prepaid or converted or continued
or not borrowed or converted or continued (based on LIBOR applicable thereto)
for the period from the date of such payment, prepayment, conversion,
continuation or failure to borrow, convert or continue on the last day of the
Interest Period for such Loan (or, in the case of a failure to borrow, convert
or continue, the last day of the Interest Period for such Loan that would have
commenced on the date of such failure to borrow, convert or continue) over (ii)
the amount of interest (as reasonably determined by such Revolving Loan Lender)
that would be realized by such Revolving Loan Lender in re-employing the funds
so paid, prepaid, converted or continued or not borrowed, converted or continued
for such Interest Period. A certificate of any Revolving Loan Lender setting
forth in reasonable detail any amount or amounts that such Senior Lender is
entitled to receive pursuant to this Section 2.10 and the basis for the
determination of such amount or amounts shall be delivered to the Administrative
Borrower and shall be conclusive and binding absent manifest error.
(b) Notwithstanding paragraph (a) of this Section 2.10,
the Administrative Agent will use reasonable efforts to minimize or reduce any
such loss or expense resulting from the mandatory prepayments required by
Section 2.05 of this Agreement by applying all payments and prepayments to
Reference Rate Loans prior to any application of payments to LIBOR Rate Loans.
Section 2.11 Continuation and Conversion of Loans. Subject to
Section 2.09 hereof, Allied Systems shall have the right, at any time, on three
(3) Business Days prior irrevocable written notice to the Administrative Agent,
to continue any LIBOR Rate Loan, or any portion thereof, into a subsequent
Interest Period or to convert any Reference Rate Loan or portion thereof into a
LIBOR Rate Loan, or on one (1) Business Day prior irrevocable written notice to
the Administrative Agent, to convert any LIBOR Rate Loan or portion thereof into
a Reference Rate Loan, subject to the following:
(a) no LIBOR Rate Loan may be continued as such and no
Reference Rate Loan may be converted into a LIBOR Rate Loan, when any Event of
Default or Default shall have occurred and be continuing at such time,
(b) in the case of a continuation of a LIBOR Rate Loan as
such or a conversion of a Reference Rate Loan into a LIBOR Rate Loan, the
aggregate principal amount of
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such LIBOR Rate Loan shall not be less than $1,000,000 and in multiples of
$500,000 if in excess thereof;
(c) any portion of a Senior Loan maturing or required to
be repaid in less than two weeks may not be converted into or continued as a
LIBOR Rate Loan; and
(d) if any conversion of a LIBOR Rate Loan shall be
effected on a day other than the last day of an Interest Period, Allied Systems
shall reimburse each Revolving Loan Lender on demand for any loss incurred or to
be incurred or to be incurred by it in the reemployment of the funds released by
such conversion as provided in Section 2.10 hereof.
In the event that Allied Systems shall not give notice to continue any LIBOR
Rate Loan into a subsequent Interest Period, such Loan shall automatically
become a Reference Rate Loan at the expiration of the then current Interest
Period.
ARTICLE III
LETTERS OF CREDIT
Section 3.01 Letter of Credit Guaranty. In order to assist Allied
Systems in establishing or opening standby letters of credit, which shall not
have expiration dates later than the Final Senior Loan Maturity Date (each a
"Letter of Credit"), with the L/C Issuer, Allied Systems has requested the
Administrative Agent to join in the applications for such Letters of Credit,
and/or guarantee payment or performance of such Letters of Credit and any drafts
thereunder through the issuance of a Letter of Credit Guaranty, thereby lending
the Administrative Agent's credit to that of Allied Systems, and the
Administrative Agent has agreed to do so. These arrangements shall be
coordinated by the Administrative Agent, subject to the terms and conditions set
forth below. The Administrative Agent shall not be required to be the issuer of
any Letter of Credit. Allied Systems will be the account parties for the
application for each Letter of Credit, which shall be in form and substance
satisfactory to the Administrative Agent and the L/C Issuer or on a computer
transmission system approved by the Administrative Agent and the L/C Issuer, or
such other written form or computer transmission system as may from time to time
be approved by the Administrative Agent and the L/C Issuer, and shall be duly
completed in a manner and at a time reasonably acceptable to the Administrative
Agent, together with such other certificates, agreements, documents and other
papers and information as the Administrative Agent and the L/C Issuer may
reasonably request, which shall include, without limitation, the requested date
of issuance and the name and address of the beneficiary (the "Letter of Credit
Application"). In the event of any conflict between the terms of any Letter of
Credit Application and this Agreement, for purposes of this Agreement, the terms
of this Agreement shall control.
(b) The aggregate Letter of Credit Obligations shall not
exceed the lowest of (i) the difference between (A) the Total Revolving Credit
Commitment and (B) the aggregate principal amount of all Revolving Loans then
outstanding, (ii) the difference between (A) the Borrowing Base and (B) the
aggregate principal amount of all Revolving Loans then outstanding, and (iii)
the L/C Subfacility. In addition, the terms and conditions of all Letters of
Credit and all changes or modifications thereof by the Borrowers and/or the L/C
Issuer shall in all respects be subject to the prior approval of the
Administrative Agent in its reasonable business
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judgment; provided, however, that (i) the expiry date of all Letters of Credit
shall be no later than the Final Senior Loan Maturity Date and (ii) the Letters
of Credit and all documentation in connection therewith shall be in form and
substance reasonably satisfactory to the Administrative Agent and the L/C
Issuer.
(c) If the Administrative Agent is obligated to advance
funds under a Letter of Credit, the Administrative Agent may immediately
reimburse such disbursement by charging the Loan Account as set forth below. In
the event that the Administrative Agent does not charge the Loan Account, Allied
Systems shall, upon demand by the Administrative Agent, immediately reimburse
such disbursement to the Administrative Agent by paying to it an amount equal to
such disbursement not later than 12:00 noon (New York City time) on the date
that such disbursement is made, if Allied Systems shall have received written or
telephonic notice of such disbursement prior to 11:00 a.m. (New York City time)
on such date, or, if such notice has not been received by Allied Systems prior
to such time on such date, then no later than 12:00 noon (New York City time) on
the Business Day that Allied Systems receives such notice, if such notice is
received prior to 11:00 a.m. (New York City time) on the date of receipt. In the
absence of such reimbursement, the Administrative Agent shall have the right,
without notice to Allied Systems, to charge the Loan Account with the amount of
such disbursement and the Administrative Agent shall have the right, without
notice to Allied Systems, to charge the Loan Account with the amount of any and
all other Indebtedness, liabilities and obligations of any kind (including
indemnification for breakage costs, capital adequacy and reserve requirement
charges) incurred by the Agents or the Revolving Loan Lenders under the Letter
of Credit Guaranty or incurred by the L/C Issuer with respect to a Letter of
Credit at the earlier of (i) payment by the Administrative Agent or the
Revolving Loan Lenders under the Letter of Credit Guaranty or (ii) the
occurrence of any Default or Event of Default. Any amount charged to the Loan
Account shall be deemed a Revolving Loan hereunder made by the Revolving Loan
Lenders to Allied Systems, funded by the Administrative Agent on behalf of the
Revolving Loan Lenders and subject to Section 2.02 of this Agreement. Any
charges, fees, commissions, costs and expenses charged to the Administrative
Agent for Allied Systems' account by the L/C Issuer in connection with or
arising out of Letters of Credit or transactions relating thereto will be
charged to the Loan Account in full when charged to or paid by the
Administrative Agent and, when charged, shall be conclusive on Allied Systems
absent manifest error. Each of the Revolving Loan Lenders and Allied Systems
agrees that the Administrative Agent shall have the right to make such charges
regardless of whether any Default or Event of Default shall have occurred and be
continuing or whether any of the conditions precedent in Section 5.02 have been
satisfied. If any such reimbursement of disbursements made by the Administrative
Agent is not made by the Administrative Agent by charging the Loan Account and
Allied Systems requests and is entitled to obtain a Revolving Loan to reimburse
such disbursements on the date such reimbursement is due, such reimbursement
shall be made no later than the time that the Administrative Agent makes the
proceeds of the Revolving Loan available to Allied Systems.
(d) Allied Systems understands that the Letter of Credit
Guaranties may require the Senior Lenders to indemnify the L/C Issuer for
certain costs or liabilities arising out of claims by Allied Systems against
such L/C Issuer. Allied Systems unconditionally indemnifies each Agent and each
Senior Lender and holds each Agent and each Senior Lender harmless from any and
all loss, claim or liability incurred by any Agent or any Senior Lender arising
from any transactions or occurrences relating to Letters of Credit, any drafts
or
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acceptances thereunder, the Collateral relating thereto, and all Obligations
in respect thereof, including any such loss or claim due to any action taken by
the L/C Issuer, other than for any such loss, claim or liability arising out of
the gross negligence or willful misconduct of the L/C Issuer, any Agent or any
Lender as determined by a final judgment of a court of competent jurisdiction.
Allied Systems further agrees to hold each Agent and each Senior Lender harmless
from any errors or omission, negligence or misconduct by the L/C Issuer. Allied
Systems agrees to be bound by the L/C Issuer's regulations and interpretations
of any Letter of Credit that is the subject of a Letter of Credit Guaranty and
opened to or for Allied Systems account or by the Administrative Agent's
interpretations of any Letter of Credit issued for Allied Systems account, even
though such interpretation may be different from Allied Systems' own, and Allied
Systems understands and agrees that the Senior Lenders, the Agents and the L/C
Issuer shall not be liable for any error, negligence, or mistake, whether of
omission or commission, in following Allied Systems' instructions or those
contained in the Letter of Credit or any modifications, amendments, or
supplements thereto. Allied Systems' unconditional obligations to each Agent,
each Senior Lender and the L/C Issuer with respect to Letters of Credit
hereunder shall not be modified or diminished for any reason or in any manner
whatsoever, other than as a result of such Agent's, such Senior Lender's or the
L/C Issuer's gross negligence or willful misconduct as determined by a final
judgment of a court of competent jurisdiction. The Borrowers agree that any
charges incurred by the Administrative Agent or the L/C Issuer for the
Borrowers' account hereunder may be charged to the Loan Account.
(e) Upon any payments made to the L/C Issuer under the
Letter of Credit Guaranty, the Agents or the Revolving Loan Lenders, as the case
may be, shall, without prejudice to their rights under this Agreement (including
that such unreimbursed amounts shall constitute Revolving Loans hereunder),
acquire by subrogation, any rights, remedies, duties or obligations granted or
undertaken by Allied Systems in favor of the L/C Issuer in any application for
Letters of Credit, any standing agreement relating to Letters of Credit or
otherwise, all of which shall be deemed to have been granted to the Agents and
the Revolving Loan Lenders and apply in all respects to the Agents and the
Revolving Loan Lenders and shall be in addition to any rights, remedies, duties
or obligations contained herein.
Section 3.02 Participations.
(a) Purchase of Participations. Immediately upon issuance
by the L/C Issuer of any Letter of Credit pursuant to this Agreement, each
Revolving Loan Lender shall be deemed to have irrevocably and unconditionally
purchased and received from the Administrative Agent, without recourse or
warranty, an undivided interest and participation, to the extent of such
Revolving Loan Lender's Pro Rata Share, in all obligations of the Administrative
Agent in such Letter of Credit (including, without limitation, all Reimbursement
Obligations of Allied Systems with respect thereto pursuant to the Letter of
Credit Guaranty or otherwise).
(b) Sharing of Payments. In the event that the
Administrative Agent makes any payment in respect of the Letter of Credit
Guaranty and Allied Systems shall not have repaid such amount to the
Administrative Agent, the Administrative Agent shall charge the Loan Account in
the amount of the Reimbursement Obligation, in accordance with Sections 3.01(c)
and 4.02 of this Agreement.
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(c) Obligations Irrevocable. The obligations of a
Revolving Loan Lender to make payments to the Administrative Agent for the
account of the Agents, the Revolving Loan Lenders or the L/C Issuer with respect
to a Letter of Credit shall be irrevocable, without any qualification or
exception whatsoever and shall be made in accordance with the terms and
conditions of this Agreement under all circumstances, including, without
limitation, any of the following circumstances:
(i) any lack of validity or enforceability of
this Agreement or any of the other Loan Documents;
(ii) the existence of any claim, setoff, defense
or other right which Allied Systems or any other Loan Party may have at any time
against a beneficiary named in such Letter of Credit or any transferee of such
Letter of Credit (or any Person for whom any such transferee may be acting), any
Agent, any Lender, or any other Person, whether in connection with this
Agreement, such Letter of Credit, the transactions contemplated herein or any
unrelated transactions (including any underlying transactions between Allied
Systems or any other Loan Party or any other party and the beneficiary named in
such Letter of Credit);
(iii) any draft, certificate or any 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;
(iv) the surrender or impairment of any security
for the performance or observance of any of the terms of any of the Loan
Documents;
(v) any failure by any Agent to provide any
notices required pursuant to this Agreement relating to such Letter of Credit;
(vi) any payment by the L/C Issuer under such
Letter of Credit against presentation of a draft or certificate which does not
comply with the terms of such Letter of Credit; or
(vii) the occurrence of any Default or Event of
Default.
Section 3.03 Letters of Credit.
(a) Request for Issuance. The Administrative Borrower
may, upon reasonable notice in advance of such issuance but, in any event, not
later than 12:00 noon, New York City time, at least two (2) Business Days in
advance of the issuance thereof, request the Administrative Agent to assist
Allied Systems in establishing or opening a Letter of Credit by delivering to
the Administrative Agent, with a copy to the L/C Issuer, a Letter of Credit
Application, together with any necessary related documents. The Administrative
Agent shall not provide support, pursuant to the Letter of Credit Guaranty, if
the Administrative Agent shall have received written notice from the Collateral
Agent or the Required Lenders on the Business Day immediately preceding the
proposed issuance date for such Letter of Credit that one or more of the
conditions precedent in Section 5.02 will not have been satisfied on such date,
and the Administrative Agent shall not otherwise be required to determine that,
or take notice whether, the conditions precedent set forth in Section 5.02 have
been satisfied.
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(b) Letter of Credit Fees. (i) Allied Systems shall pay
to the Administrative Agent for the account of the Revolving Loan Lenders, in
accordance with a written agreement among the Agents and such Revolving Loan
Lenders (x) for any Letter of Credit issued hereunder, a nonrefundable fee equal
to 3.50% per annum of the stated amount of such Letter of Credit, payable
monthly in arrears and (y) for any amendment to an existing Letter of Credit
that increases the stated amount of such Letter of Credit, a nonrefundable fee
equal to 3.50% per annum of the increase in the stated amount of such Letter of
Credit, payable monthly in arrears after the date of such increase (the "Letter
of Credit Fees").
(ii) L/C Issuer Charges. Allied Systems shall pay
to the Administrative Agent any and all charges assessed by the L/C Issuer in
connection with the issuance, administration, amendment, payment or cancellation
of Letters of Credit.
(iii) Charges to the Loan Account. Allied Systems
hereby authorizes the Administrative Agent to, and the Administrative Agent may,
from time to time, charge the Loan Account pursuant to Section 3.01(c) and
Section 4.02 of this Agreement with the amount of any Letter of Credit fees or
charges due under this Section 3.03.
ARTICLE IV
FEES, PAYMENTS AND OTHER COMPENSATION
Section 4.01 Audit and Collateral Monitoring Fees. The Borrowers
acknowledge that representatives of the Agents may visit any or all of the Loan
Parties and/or conduct audits, inspections, valuations and/or field examinations
of any or all of the Loan Parties at any time and from time to time in a manner
so as to not unduly disrupt the business of the Loan Parties. The Borrowers
agree to pay (i) $1,500 per day per examiner plus the examiner's out-of-pocket
costs and reasonable expenses incurred in connection with all such visits,
audits, inspections, valuations and field examinations, (ii) the reasonable cost
of all visits, audits, inspections, valuations or field examinations conducted
by a third party on behalf of the Agents and (iii) a one time charge of $5,000
plus out-of-pocket expenses for the establishment of electronic collateral
reporting systems with the Administrative Agent pursuant to Section 7.01(q).
Section 4.02 Payments; Computations and Statements. (a) The
Borrowers will make each payment under this Agreement with respect to the Senior
Obligations and the Fee Letter not later than 12:00 noon (New York City time) on
the day when due, in lawful money of the United States of America and in
immediately available funds, to the Administrative Agent in the Administrative
Agent's Account. All payments received by the Administrative Agent after 12:00
noon (New York City time) on any Business Day will be credited to the Loan
Account on the next succeeding Business Day. All payments shall be made by the
Borrowers with respect to the Senior Obligations without defense, set-off or
counterclaim to the Agents and the Senior Lenders. Except as provided in Section
2.02, after receipt, the Administrative Agent will promptly thereafter cause to
be distributed like funds relating to the payment of principal ratably to the
Senior Lenders in accordance with their Pro Rata Shares and like funds relating
to the payment of any other amount payable to any Lender to such Senior Lender,
in each case to be applied in accordance with the terms of this Agreement,
provided that the Administrative Agent will cause to be distributed all interest
and fees received from or for the account of the Borrowers not less than once
each month
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and in any event promptly after receipt thereof. The Senior Lenders and the
Borrowers hereby authorize the Administrative Agent to, and the Administrative
Agent may, from time to time, charge the Loan Account of the Borrowers with any
amount due and payable by the Borrowers under any Loan Document with respect to
the Senior Obligations. Each of the Senior Lenders and the Borrowers agrees that
the Administrative Agent shall have the right to make such charges whether or
not any Default or Event of Default shall have occurred and be continuing or
whether any of the conditions precedent in Section 5.02 have been satisfied. Any
amount charged to the Loan Account of the Borrowers shall be deemed a Revolving
Loan hereunder made by the Revolving Loan Lenders to the Borrowers, funded by
the Administrative Agent on behalf of the Revolving Loan Lenders and subject to
Section 2.02 of this Agreement. The Senior Lenders and the Borrowers confirm
that any charges which the Administrative Agent may so make to the Loan Account
of the Borrowers as herein provided will be made as an accommodation to the
Borrowers and solely at the Administrative Agent's discretion, provided that, in
the absence of a continuing Event of Default, the Administrative Agent shall
from time to time upon the request of the Collateral Agent, charge the Loan
Account of the Borrowers with any amount due and payable under any Loan Document
with respect to the Senior Obligations. In the case of any Senior Obligations,
whenever any payment to be made under any such Loan Document shall be stated to
be due on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day and such extension of time shall in such case be
included in the computation of interest or fees, as the case may be. All
computations of fees with respect to the Senior Obligations shall be made by the
Administrative Agent on the basis of a year of 360 days for the actual number of
days (including the first day but excluding the last day) occurring in the
period for which such fees are payable. Each determination by the Administrative
Agent of an interest rate or fees hereunder shall be conclusive and binding for
all purposes in the absence of manifest error.
(b) The Administrative Agent shall provide the
Administrative Borrower promptly after the end of each calendar month, a summary
statement (in the form from time to time used by the Administrative Agent) of
the opening and closing daily balances in the Loan Account of the Borrowers
during such month, the amounts and dates of all Senior Loans made to the
Borrowers during such month, the amounts and dates of all payments on account of
the Senior Loans to Allied Systems during such month and the Senior Loans to
which such payments were applied, the amount of interest accrued on the Senior
Loans to Allied Systems during such month, any Letters of Credit issued by the
L/C Issuer for the account of Allied Systems during such month, specifying the
face amount thereof, the amount of charges to the Loan Account and/or Senior
Loans made to Allied Systems during such month to reimburse the Revolving Loan
Lenders for drawings made under Letters of Credit, and the amount and nature of
any charges to the Loan Account made during such month on account of fees,
commissions, expenses and other Senior Obligations. All entries on any such
statement shall be presumed to be correct and, thirty (30) days after the same
is sent, shall be final and conclusive absent manifest error.
Section 4.03 Sharing of Payments, Etc. Except as provided in
Section 2.02, if any Senior Lender shall obtain any payment (whether voluntary,
involuntary, through the exercise of any right of set-off, or otherwise) on
account of any Senior Obligation in excess of its ratable share of payments on
account of similar obligations obtained by all the Senior Lenders or shall
receive any payment not permitted to be received by such Senior Lender pursuant
to this Agreement, such Senior Lender shall forthwith purchase from the other
Senior Lenders such
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participations in such similar obligations held by them as shall be necessary to
cause such purchasing Senior Lender to share the excess payment ratably with
each of them; provided, however, that if all or any portion of such excess
payment is thereafter recovered from such purchasing Senior Lender, such
purchase from each Senior Lender shall be rescinded and such Senior Lender shall
repay to the purchasing Senior Lender the purchase price to the extent of such
recovery together with an amount equal to such Senior Lender's ratable share
(according to the proportion of (i) the amount of such Senior Lender's required
repayment to (ii) the total amount so recovered from the purchasing Senior
Lender of any interest or other amount paid by the purchasing Senior Lender in
respect of the total amount so recovered). The Borrowers agree that any Senior
Lender so purchasing a participation from another Senior Lender pursuant to this
Section 4.03 may, to the fullest extent permitted by law, exercise all of its
rights (including the Lender's right of set-off) with respect to such
participation as fully as if such Senior Lender were the direct creditor of the
Borrowers in the amount of such participation.
Section 4.04 Apportionment of Payments. Subject to Section 2.02
hereof and to any written agreement among the Agents and/or the Senior Lenders:
(a) All payments of principal and interest in respect of
outstanding Senior Loans, all payments in respect of the Reimbursement
Obligations, all payments of fees with respect to the Senior Obligations (other
than the fees set forth in Section 2.06 hereof to the extent set forth in a
written agreement among the Agents and the Senior Lenders, fees with respect to
Letters of Credit provided for in Section 3.03(b)(ii) and the audit and
collateral monitoring fee provided for in Section 4.01) and all other payments
(including all proceeds of the Collateral received by either of the Agents) in
respect of any other Senior Obligations, shall be allocated by the
Administrative Agent among such of the Senior Lenders as are entitled thereto,
in proportion to their respective Pro Rata Shares or otherwise as provided
herein or, in respect of payments not made on account of Senior Loans or Letter
of Credit Obligations, as designated by the Person making payment when the
payment is made.
(b) Subject to paragraph (e) of this Section 4.04 and
notwithstanding any other provision of this Agreement or any Loan Document to
the contrary, after the occurrence and during the continuance of an Event of
Default, the Administrative Agent may, and upon the direction of the Required
Revolving Lenders (or if the Total Revolving Credit Commitment has been
terminated and all of the Revolving Loans have been repaid in full and the
Letter of Credit Obligations have been returned for cancellation or cash
collateralized in accordance with the provisions hereof, upon the direction of
the Required Lenders) shall, apply all payments in respect of any Obligations
and all proceeds of the Collateral, subject to the provisions of this Agreement,
(i) first, ratably to pay the Senior Obligations in respect of any fees
(including any fees or charges assessed by the L/C Issuer), expense
reimbursements, indemnities and other amounts then due to the Agents or the L/C
Issuer until paid in full; (ii) second, ratably to pay the Revolving Loan
Obligations in respect of any fees (including Letter of Credit Fees), expense
reimbursements and indemnities then due to the Revolving Loan Lenders until paid
in full; (iii) third, ratably to pay interest due in respect of the Agent
Advances until paid in full; (iv) fourth, ratably to pay principal of the Agent
Advances until paid in full; (v) fifth, ratably to pay interest due in respect
of the Revolving Loans and Reimbursement Obligations until paid in full; (vi)
sixth, ratably to pay principal of the Revolving Loans and Letter of Credit
Obligations (or, to the extent such Senior Obligations are contingent, to
provide cash collateral in an amount up to
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110% of such Senior Obligations) then due and payable until paid in full; (vii)
seventh, ratably to pay the Term Loan A Obligations in respect of any fees,
expense reimbursements and indemnities then due to the Term Loan A Lenders until
paid in full; (viii) eighth, ratably to pay interest due in respect of the Term
Loan A until paid in full; (ix) ninth, ratably to pay principal of the Term Loan
A then due and payable until paid in full; (x) tenth, ratably to pay the Term
Loan B Obligations in respect of any fees, expense reimbursements and
indemnities then due to the Term Loan B Lenders until paid in full; (xi)
eleventh, ratably to pay interest due in respect to the Term Loan B until paid
in full; (xii) twelfth, ratably to pay principal of the Term Loan B then due and
payable until paid in full; (xiii) thirteenth, ratably to pay the Term Loan C
Obligations in respect of any fees, expense reimbursements and indemnities then
due to the Term Loan C Lenders until paid in full; (xiv) fourteenth, ratably to
pay interest due in respect to the Term Loan C until paid in full; (xv)
fifteenth, ratably to pay principal of the Term Loan C until paid in full; (xvi)
sixteenth, to the ratable payment of all other Senior Obligations then due and
payable; and (xvii) seventeenth, ratably to pay the Subordinated Obligations
(including, without limitation, the Prepayment Premium) then due and payable.
Notwithstanding anything to the contrary, the Prepayment Premium shall not be
paid to any Senior Lender until all other Senior Obligations have been paid in
full.
(c) In each instance, so long as no Event of Default has
occurred and is continuing, Section 4.04(b) shall not be deemed to apply to any
payment by the Borrowers specified by Administrative Borrower to the
Administrative Agent to be for the payment of specific Senior Obligations then
due and payable under any provision of this Agreement or the prepayment of all
or part of the principal of the Senior Loans in accordance with the terms and
conditions of Section 2.05.
(d) For purposes of Section 4.04(b), "paid in full" means
payment of all amounts owing under the Loan Documents, including fees, interest,
default interest, interest on interest, expense reimbursements and indemnities,
specifically including in each case any of the foregoing which would accrue
after the commencement of any Insolvency Proceeding irrespective of whether a
claim is allowable in such Insolvency Proceeding.
(e) Notwithstanding anything contained in this Agreement,
including without limitation, Section 2.05(d) and Section 4.04(b), after the
occurrence and during the continuance of an Event of Default:
(i) the proceeds from the Disposition of a
Facility shall be applied to the Obligations in the following order of priority:
(A) first, ratably to pay principal of the Term Loan A then due and payable
until paid in full; (B) second, ratably to pay interest due in respect of the
Term Loan A until paid in full; (C) third, ratably to pay the Term Loan A
Obligations in respect of any fees, expense reimbursements and indemnities then
due to the Term Loan A Lenders until paid in full; (D) fourth, ratably to pay
principal of the Term Loan B then due and payable until paid in full; (E) fifth,
ratably to pay interest due in respect to the Term Loan B until paid in full;
(F) sixth, ratably to pay the Term Loan B Obligations in respect of any fees,
expense reimbursements and indemnities then due to the Term Loan B Lenders until
paid in full; (G) seventh, ratably to pay the Senior Obligations in respect of
any fees (including any fees or charges assessed by the L/C Issuer), expense
reimbursements, indemnities and other amounts then due to the Agents or the L/C
Issuer until paid in full; (H) eighth, ratably to pay the
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Revolving Loan Obligations in respect of any fees (including Letter of Credit
Fees), expense reimbursements and indemnities then due to the Revolving Loan
Lenders until paid in full; (I) ninth, ratably to pay interest due in respect of
the Agent Advances until paid in full; (J) tenth, ratably to pay principal of
the Agent Advances until paid in full; (K) eleventh, ratably to pay interest due
in respect of the Revolving Loans and Reimbursement Obligations until paid in
full; (L) twelfth, ratably to pay principal of the Revolving Loans and Letter of
Credit Obligations (or, to the extent such Senior Obligations are contingent, to
provide cash collateral in an amount up to 110% of such Senior Obligations) then
due and payable until paid in full; (M) thirteenth, ratably to pay the Term Loan
C Obligations in respect of any fees, expense reimbursements and indemnities
then due to the Term Loan C Lenders until paid in full; (N) fourteenth, ratably
to pay interest due in respect to the Term Loan C until paid in full; (O)
fifteenth, ratably to pay principal of the Term Loan C until paid in full; (P)
sixteenth, to the ratable payment of all other Senior Obligations then due and
payable (including, without limitation, the Prepayment Premium); and (Q)
seventeenth, ratably to pay the Subordinated Obligations then due and payable,
and
(ii) the proceeds from the from the Disposition
of the Capital Stock or assets of any Axis Entity shall be applied to the
Obligations in the following order of priority: (A) the first $5,000,000 less
the aggregate amount of any mandatory prepayments made to the Term Loan A
Obligations prior to such date pursuant to Section 2.05(d)(ii) to (x) first,
ratably to pay principal of the Term Loan A then due and payable until paid in
full; (y) second, ratably to pay interest due in respect of the Term Loan A
until paid in full; and (z) third, ratably to pay the Term Loan A Obligations in
respect of any fees, expense reimbursements and indemnities then due to the Term
Loan A Lenders until paid in full; and (B) the remainder to (v) first, ratably
to pay the Revolving Loan Obligations in respect of any fees (including Letter
of Credit Fees), expense reimbursements and indemnities then due to the
Revolving Loan Lenders until paid in full; (w) second, ratably to pay interest
due in respect of the Agent Advances until paid in full; (x) third, ratably to
pay principal of the Agent Advances until paid in full; (y) fourth, ratably to
pay interest due in respect of the Revolving Loans and Reimbursement Obligations
until paid in full; and (z) fifth, ratably to pay principal of the Revolving
Loans and Letter of Credit Obligations (or, to the extent such Senior
Obligations are contingent, to provide cash collateral in an amount up to 110%
of such Senior Obligations) then due and payable until paid in full.
(f) Prior to the Senior Facility Termination Date, except
with respect to regularly scheduled interest payments, payment of any fees,
expense reimbursements and indemnities made, in each case, when no Event of
Default has occurred and is continuing, and the payments described in Sections
2.05(d)(iii), 2.05(d)(iv), 2.05(d)(vi) and 4.04(b), no payments shall be made to
the Subordinated Term Loan D Lenders.
(g) In the event of a direct conflict between the
priority provisions of this Section 4.04 and other provisions contained in any
other Loan Document, it is the intention of the parties hereto that both such
priority provisions in such documents shall be read together and construed, to
the fullest extent possible, to be in concert with each other. In the event of
any actual, irreconcilable conflict that cannot be resolved as aforesaid, the
terms and provisions of this Section 4.04 shall control and govern.
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Section 4.05 Increased Costs and Reduced Return. (a) If any Senior
Lender, any Agent or the L/C Issuer shall have determined that the adoption or
implementation of, or any change in, any law, rule, treaty or regulation, or any
policy, guideline or directive of, or any change in, the interpretation or
administration thereof, in any such case occurring after the Effective Date, by,
any court, central bank or other administrative or Governmental Authority, or
compliance by any Senior Lender, any Agent or the L/C Issuer or any Person
controlling any such Senior Lender, any such Agent or the L/C Issuer with any
directive of, or guideline from, any central bank or other Governmental
Authority issued after the Effective Date, or the introduction issued after the
Effective Date, or change, in any such case occurring after the Effective Date
in, any accounting principles applicable to any Senior Lender, any Agent or the
L/C Issuer or any Person controlling any such Senior Lender, any such Agent or
the L/C Issuer (in each case, whether or not having the force of law), shall (i)
subject any Senior Lender, any Agent or the L/C Issuer, or any Person
controlling any such Senior Lender, any such Agent or the L/C Issuer to any tax,
duty or other charge with respect to this Agreement or any Senior Loan made by
such Senior Lender or such Agent or any Letter of Credit issued by the L/C
Issuer, or change the basis of taxation of payments to any Senior Lender, any
Agent or the L/C Issuer or any Person controlling any such Senior Lender, any
such Agent or the L/C Issuer of any amounts payable hereunder (except for taxes
on the overall net income of any Senior Lender, any Agent or the L/C Issuer or
any Person controlling any such Senior Lender, any such Agent or the L/C
Issuer), (ii) impose, modify or deem applicable any reserve, special deposit or
similar requirement against any Senior Loan, any Letter of Credit or against
assets of or held by, or deposits with or for the account of, or credit extended
by, any Senior Lender, any Agent or the L/C Issuer or any Person controlling any
such Senior Lender, any such Agent or the L/C Issuer or (iii) impose on any
Senior Lender, any Agent or the L/C Issuer or any Person controlling any such
Senior Lender, any such Agent or the L/C Issuer any other condition regarding
this Agreement or any Senior Loan or Letter of Credit, and the result of any
event referred to in clauses (i), (ii) or (iii) above shall be to increase the
cost to any Senior Lender, any Agent or the L/C Issuer of making any Senior
Loan, issuing, guaranteeing or participating in any Letter of Credit, or
agreeing to make any Senior Loan or issue, guaranty or participate in any Letter
of Credit, or to reduce any amount received or receivable by any Senior Lender,
any Agent or the L/C Issuer hereunder, then, the Borrowers shall pay to such
Senior Lender, such Agent or the L/C Issuer such additional amounts as will
compensate such Senior Lender, such Agent or the L/C Issuer for such increased
costs or reductions in amount. Such indemnification shall be paid within 10 days
from the date on which any such Senior Lender, any such Agent or the L/C Issuer
makes written demand therefor, which demand shall identify in reasonable detail
the nature and amount of increased costs or reductions in amount.
(b) If any Senior Lender, any Agent or the L/C Issuer
shall have determined that any Capital Guideline or the adoption or
implementation of, or any change in, any Capital Guideline by the Governmental
Authority charged with the interpretation or administration thereof, or
compliance by any Senior Lender, any Agent or the L/C Issuer or any Person
controlling such Senior Lender, such Agent or the L/C Issuer with any Capital
Guideline or with any request or directive of any such Governmental Authority
with respect to any Capital Guideline, or the implementation of, or any change
in, any applicable accounting principles (in each case, whether or not having
the force of law), either (i) affects or would affect the amount of capital
required or expected to be maintained by any Senior Lender, any Agent or the L/C
Issuer or any Person controlling such Senior Lender, such Agent or the L/C
Issuer, and any Senior Lender, any Agent or the L/C Issuer determines that the
amount of such capital is
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increased as a direct or indirect consequence of any Senior Loans made or
maintained, Letters of Credit issued or any guaranty or participation with
respect thereto, any Senior Lender's, any Agent's or the L/C Issuer's or any
such other controlling Person's other obligations hereunder, or (ii) has or
would have the effect of reducing the rate of return on any Senior Lender's, any
Agent's or the L/C Issuer's any such other controlling Person's capital to a
level below that which such Senior Lender, such Agent or the L/C Issuer or such
controlling Person could have achieved but for such circumstances as a
consequence of any Senior Loans made or maintained, Letters of Credit issued, or
any guaranty or participation with respect thereto or any agreement to make
Loans, to issue Letters of Credit or such Senior Lender's, such Agent's or the
L/C Issuer's or such other controlling Person's other obligations hereunder (in
each case, taking into consideration, such Senior Lender's, such Agent's or the
L/C Issuer's or such other controlling Person's policies with respect to capital
adequacy), then, the Borrowers shall pay to such Senior Lender, such Agent or
the L/C Issuer from time to time such additional amounts as will compensate such
Senior Lender, such Agent or the L/C Issuer for such cost of maintaining such
increased capital or such reduction in the rate of return on such Senior
Lender's, such Agent's or the L/C Issuer's or such other controlling Person's
capital. Such indemnifications shall be paid within 10 days from the date on
which any such Senior Lender, any such Agent or the L/C Issuer makes written
demand therefor, which demand shall identify in reasonable detail the nature and
amount of cost of maintaining such increased capital or such reduction in the
rate of return on such Senior Lender's, such Agent's or the L/C Issuer's or such
other controlling Person's capital.
(c) All amounts payable under this Section 4.05 shall
bear interest from the date that is ten (10) days after the date of demand by
any Senior Lender, any Agent or the L/C Issuer until payment in full to such
Senior Lender, such Agent or the L/C Issuer at the Reference Rate. A certificate
of such Senior Lender, such Agent or the L/C Issuer claiming compensation under
this Section 4.05, specifying the event herein above described and the nature of
such event shall be submitted by such Senior Lender, such Agent or the L/C
Issuer to the Administrative Borrower, setting forth the additional amount due
and an explanation of the calculation thereof, and such Senior Lender's, such
Agent's or the L/C Issuer's reasons for invoking the provisions of this Section
4.05, and shall be final and conclusive absent manifest error. Notwithstanding
anything contained in this Section 4.05 to the contrary, any Senior Lender,
Agent or L/C Issuer seeking compensation or payment under this Section 4.05
shall only be entitled to received such payments in respect of circumstances or
events that arose within the one hundred and eighty (180) day period immediately
prior to demand for such amounts.
ARTICLE V
CONDITIONS TO LOANS
Section 5.01 Conditions Precedent to Effectiveness. This Agreement
shall become effective as of the Business Day (the "Effective Date") when each
of the following conditions precedent shall have been satisfied in a manner
satisfactory to the Agents:
(a) Payment of Fees, Etc. The Borrowers shall have paid
on or before the date of this Agreement all fees, costs, expenses and taxes then
payable pursuant to Sections 2.06 and 12.04.
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(b) Representations and Warranties; No Event of Default.
The following statements shall be true and correct: (i) the representations and
warranties contained in Article VI and in each other Loan Document, certificate
or other writing delivered to any Agent, any Lender or the L/C Issuer pursuant
hereto or thereto on or prior to the Effective Date are true and correct on and
as of the Effective Date as though made on and as of such date and (ii) no
Default or Event of Default shall have occurred and be continuing on the
Effective Date or would result from this Agreement or the other Loan Documents
becoming effective in accordance with its or their respective terms.
(c) Legality. The making of the initial Loans or the
issuance of any Letters of Credit shall not contravene any law, rule or
regulation applicable to any Agent, any Lender or the L/C Issuer.
(d) Delivery of Documents. The Collateral Agent shall
have received on or before the Effective Date the following, each in form and
substance satisfactory to the Collateral Agent and, unless indicated otherwise,
dated the Effective Date:
(i) a Security Agreement, duly executed by each
Loan Party;
(ii) (A) a Pledge Agreement, duly executed by
each Loan Party, together with the original stock certificates representing all
of the common stock of such Loan Party's domestic Subsidiaries and 66% of the
common stock of such Loan Party's foreign Subsidiaries and all intercompany
promissory notes of such Loan Parties, accompanied by undated stock powers
executed in blank and other proper instruments of transfer, (B) a letter of
consent from the managing general partner of Allied Systems consenting to the
pledge of the partnership interests of Allied Systems pursuant to the Pledge
Agreement and (C) evidence satisfactory to the Collateral Agent that the limited
liability company interests of Axis Netherlands, LLC shall not be evidenced by a
certificate;
(iii) the Mortgage, duly executed by the
applicable Loan Party, with respect to each Facility and a Landlord's Agreement,
in form and substance satisfactory to the Collateral Agent, duly executed by the
landlord with respect to any leasehold interest that is to be mortgaged;
(iv) evidence of delivery of the Mortgages for
recording in such office or offices as may be necessary or, in the opinion of
the Collateral Agent, desirable to perfect the Lien purported to be created
thereby or to otherwise protect the rights of the Collateral Agent and the
Lenders thereunder;
(v) the Title Insurance Policy dated as of the
Effective Date and together with an undertaking that such policy will be
re-dated as of the date of the recording of the Mortgage for each Facility;
(vi) a survey of each Facility to the extent
available, in form and substance satisfactory to the Collateral Agent, certified
to the Collateral Agent and to the issuer of the Title Insurance Policy;
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(vii) the Canadian Security Documents, duly
executed by the Canadian Loan Parties;
(viii) a UCC Filing Authorization Letter, duly
executed by each Loan Party, together with appropriate financing statements on
Form UCC-1 duly filed in such office or offices as may be necessary or, in the
opinion of the Collateral Agent, desirable to perfect the security interests
purported to be created by each Security Agreement, each Pledge Agreement and
each Mortgage and a PPSA Filing Authorization Letter, duly executed by the
applicable Loan Parties, together with appropriate PPSA financing statements
duly filed in such office or offices as may be necessary or, in the opinion of
the Collateral Agent, desirable to perfect the security interest purported to be
created by each Canadian Mortgage and each Canadian Security Agreement;
(ix) certified copies of request for copies of
information on Form UCC-11, listing all effective financing statements which
name as debtor any Loan Party and which are filed in the offices referred to in
paragraph (viii) above, together with copies of such financing statements, none
of which, except as otherwise agreed in writing by the Collateral Agent, shall
cover any of the Collateral and the results of searches for any tax Lien and
judgment Lien filed against such Person or its property, which results, except
as otherwise agreed to in writing by the Collateral Agent, shall not show any
such Liens and certified copies of PPSA search results from the applicable
Canadian jurisdiction listing all security interests against any Loan Party and
which are filed in the applicable personal property security office of such
Canadian jurisdiction and which do not disclose, except as otherwise agreed in
writing by the Collateral Agent, security interests affecting any of the
Collateral;
(x) a copy of the resolutions of each Loan
Party, certified as of the Effective Date by an Authorized Officer thereof,
authorizing (A) in the case of the Borrowers, the borrowings hereunder and, in
the case of the Borrowers and the other Loan Parties, the transactions
contemplated by the Loan Documents to which such Borrowers or such Loan Party is
or will be a party, and (B) the execution, delivery and performance by such Loan
Party of each Loan Document to which such Loan Party is or will be a party and
the execution and delivery of the other documents to be delivered by such Person
in connection herewith and therewith;
(xi) a certificate of an Authorized Officer of
each Loan Party, certifying the names and true signatures of the representatives
of such Loan Party authorized to sign each Loan Document to which such Loan
Party is or will be a party and the other documents to be executed and delivered
by such Loan Party in connection herewith and therewith, together with evidence
of the incumbency of such authorized officers;
(xii) a certificate of the appropriate official(s)
of the state or, federal government or provincial authority of Canada, as the
case may be, of organization and each state of foreign qualification of each
Designated Loan Party certifying as to the subsistence in good standing of, and
the payment of taxes by, such Designated Loan Party in such states, provinces or
other applicable jurisdiction, together with confirmation by telephone or
telegram (where available) on the Effective Date from such official(s) as to
such matters;
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(xiii) a true and complete copy of the charter,
certificate of formation, certificate of limited partnership or other publicly
filed organizational document of each Loan Party certified as of a recent date
not more than 30 days prior to the Effective Date by an appropriate official of
the state, provinces or other applicable jurisdiction, of organization of such
Loan Party;
(xiv) a copy of the charter and by-laws, limited
liability company agreement, operating agreement, agreement of limited
partnership or other organizational document of each Loan Party, together with
all amendments thereto, certified as of the Effective Date by an Authorized
Officer of such Loan Party;
(xv) an opinion of (A) Troutman Sanders LLP,
United States counsel to the Loan Parties, (B) Gowlings LaFleur Henderson LLP,
Alberta, Quebec and British Columbia counsel to the Loan Parties,(C) Aikins,
MacAulay & Thorvaldson, Manitoba counsel to the Loan Parties, (D) Stewart,
McKelvey, Stirling, Scales, New Brunswick, Newfoundland, Nova Scotia and Prince
Edward Island counsel to the Loan Parties, and (E) Kanuka Thuringer,
Saskatchewan counsel to the Loan Parties, substantially in the forms of attached
as to Exhibit F, and as to such other matters as the Collateral Agent may
reasonably request;
(xvi) a certificate of an Authorized Officer of
each Loan Party, certifying as to the matters set forth in subsection (b) of
this Section 5.01;
(xvii) a copy of the Financial Statements and
internally prepared preliminary financial statements for the Fiscal Year ended
December 31, 2001, together with a certificate of an Authorized Officer of the
Parent setting forth all existing Indebtedness, pending or threatened litigation
or claims and other contingent liabilities of the Parent and its Subsidiaries;
(xviii) a copy of the financial projections
described in Section 6.01(g)(ii) hereof and monthly projections of Availability
(including, without limitation, a sensitivity analysis), together with a copy of
the business plan, description of the turnaround plan and cost cutting plan of
the Parent and it Subsidiaries, and a schedule outlining the Parent's and its
Subsidiaries' self-insurance program, which projections, plans and schedule
shall be satisfactory in form and substance to the Agents;
(xix) evidence of the insurance coverage required
by Section 7.01(h) and the terms of each Security Agreement and each Mortgage
and such other insurance coverage with respect to the business and operations of
the Loan Parties as the Collateral Agent may reasonably request, in each case,
where requested by the Collateral Agent, with such endorsements as to the named
insureds or loss payees thereunder as the Collateral Agent may request and
providing that such policy may be terminated or canceled (by the insurer or the
insured thereunder) only upon 30 days' prior written notice to the Collateral
Agent and each such named insured or loss payee, together with evidence of the
payment of all premiums due in respect thereof for such period as the Collateral
Agent may request;
(xx) a certificate of an Authorized Officer of
the Administrative Borrower, certifying the names and true signatures of the
persons that are authorized to provide
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Notices of Borrowing, Letter of Credit Applications and all other notices under
this Agreement and the other Loan Documents;
(xxi) a landlord waiver, in form and substance
satisfactory to the Collateral Agent and which may be included as a provision
contained in the relevant Lease, executed by each landlord with respect to each
of the Leases set forth on Schedule 6.01(o);
(xxii) a collateral access agreement, in form and
substance satisfactory to the Collateral Agent, executed by each Person who
leases space to the Parent or any of its Subsidiaries to store the Rolling Stock
of any Loan Party;
(xxiii) a copy of the Indenture and the documents
related thereto (including all supplements or amendments related thereto), all
documents related to the Canadian Facility and the other Material Contracts as
in effect on the Effective Date, certified as true and correct copies thereof by
an Authorized Officer of the Administrative Borrower, together with a
certificate of an Authorized Officer of the Administrative Borrower stating that
such agreements remain in full force and effect and that none of the Loan
Parties has breached or defaulted in any of its obligations under such
agreements;
(xxiv) a termination and release agreement with
respect to the Existing Credit Facility and all related documents, duly executed
by the Loan Parties and the Existing Lender, together with a satisfaction or
registrable discharge of mortgage for each mortgage filed by the Existing Lender
on the Facility, satisfactory arrangements with respect to the release of Lien
by the Existing Lenders on each certificate of title with respect to the Rolling
Stock and UCC-3 termination statements for all UCC-1 financing statements filed
by the Existing Lender and covering any portion of the Collateral and PPSA
discharge statements relating to the applicable provincial PPSA registrations
against the Loan Parties in favor of the Existing Lenders;
(xxv) a review of the existing Phase I
environmental audits provided by the Borrowers to the Collateral Agent (and, if
requested by the Collateral Agent based upon the results of such Phase I
environmental audits, Phase II environmental audits) of each Facility, which
audits shall be in form and substance satisfactory to the Collateral Agent;
(xxvi) such depository account, blocked account,
lockbox account and similar agreements and other documents, each in form and
substance satisfactory to the Agents, as the Agents may request with respect to
the Borrowers' cash management system;
(xxvii) the Fee Letter, duly executed by Allied
Systems;
(xxviii) the Contribution Agreement, duly executed by
each Loan Party;
(xxix) a certificate of the Chief Financial Officer
of the Parent, (x) stating that the administrative processing fees charged to
customers of the Parent and its Subsidiaries are projected to result in
additional Consolidated EBITDA to the Parent and its Subsidiaries of not less
than $40,000,000 for each Fiscal Year of the Parent (assuming that unit volume
remains constant and after giving effect, if any, to the pro forma adjustments
set forth in
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Schedule 2.01(b)(iv)) and setting forth in reasonable detail a calculation of
such additional Consolidated EBITDA for such periods and (y) setting forth and
attaching a schedule describing in reasonable detail all outstanding Capital
Lease Obligations (as defined in the Indenture) incurred under clause (i) of the
second paragraph of Section 4.09 of the Indenture as of the Effective Date;
(xxx) all documents or other instruments duly
executed by the applicable Loan Party, in form and substance satisfactory to the
Collateral Agent, that is necessary to enable the Collateral Agent to perfect
its security interest in the Rolling Stock described in Schedule 5.01(d)(xxx),
which Schedule shall include for each piece of Rolling Stock information with
respect to the manufacturer, the year made, the model, the vehicle
identification number, the state in which it is licensed, the license number,
the owner, state in which it is titled and the certificate of title or ownership
identification number;
(xxxi) a copy of each life insurance policy set
forth on Schedule 5.01(d)(xxxi) and requested by the Collateral Agent, together
with collateral assignments of the Parent's interest in all of the policies set
forth on such schedule in favor of the Collateral Agent, duly executed by the
applicable Loan Party, which collateral assignments are in form to be sent to
and acknowledged by the home office of the applicable insurance company;
(xxxii) an appraisal dated February 20, 2002 with
respect to the Orderly Liquidation Values of the Rolling Stock of the Designated
Loan Parties, which appraisal was conducted by a qualified independent third
party satisfactory to the Agents, in form and substance satisfactory to the
Agents;
(xxxiii) an appraisal with respect to the Total
Enterprise Value of the Designated Loan Parties, which appraisal was conducted
by a qualified independent third party satisfactory to the Collateral Agent, in
form and substance satisfactory to the Collateral Agent;
(xxxiv) the Subordinated Term Loan D Notes, duly
executed by the Parent;
(xxxv) evidence, satisfactory to the Agents, that
the Subordinated Notes have been returned to the Parent for cancellation in
exchange for the Subordinated Term Loan D Notes;
(xxxvi) the Custodian Agreement, duly executed by
the Loan Parties and the Rolling Stock Collateral Custodian;
(xxxvii) a letter of consent from the managing
general partner of Allied Systems consenting to the pledge of the partnership
interests of Allied Systems pursuant to the Pledge Agreement and
(xxxviii) such other agreements, instruments,
approvals, opinions and other documents, each satisfactory to the Collateral
Agent in form and substance, as the Collateral Agent may reasonably request.
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(e) Material Adverse Effect. The Collateral Agent shall
have determined, in its sole judgment, that no event or development shall have
occurred since December 31, 2000 which could have a Material Adverse Effect.
(f) Proceedings; Receipt of Documents. All proceedings in
connection with the making of the initial Loans or the issuance of the initial
Letters of Credit and the other transactions contemplated by this Agreement and
the other Loan Documents, and all documents incidental hereto and thereto, shall
be satisfactory to the Collateral Agent and its counsel, and the Collateral
Agent and such counsel shall have received all such information and such
counterpart originals or certified or other copies of such documents as the
Collateral Agent or such counsel may reasonably request.
(g) Management Reference Checks. The Collateral Agent
shall have received satisfactory reference checks for key management of each
Loan Party.
(h) Due Diligence. The Agents shall have completed their
business and legal due diligence with respect to each Designated Loan Party and
the results thereof shall be acceptable to the Agents, in their sole and
absolute discretion. Without limiting the foregoing, the Agents shall have
received a Field Survey and Audit of the Collateral, dated not earlier than 30
days prior to the Effective Date, from such appraisal firm as selected by
Agents, and such Field Survey and Audit and the results thereof shall be
acceptable to the Agents, in their sole and absolute discretion.
(i) Availability. After giving effect to all Loans to be
made on the Effective Date and the Letters of Credit to be issued on the
Effective Date, the repayment of the Indebtedness under the Existing Credit
Facility and the payment of all fees and expenses related thereto, (i) the sum
of Availability plus all unrestricted cash and Cash Equivalents of the Loan
Parties shall not be less than $15,000,000 and (ii) all liabilities of the Loan
Parties shall be current. The Administrative Borrower shall deliver or caused to
be delivered to the Agents a certificate of the chief financial officer of the
Administrative Borrower certifying as to the matters set forth in clauses (i)
and (ii) above and containing the calculation of Availability.
(j) Rolling Stock Collateral Custodian. The Agents shall
be satisfied with the Rolling Stock Collateral Custodian's application filings
of the certificates of title or ownership of the Rolling Stock of the Designated
Loan Parties to note the Lien of the Collateral Agent thereon and
administration, management, processing and custodianship of the certificates of
title or ownership of such Rolling Stock on and after the Effective Date.
(k) Approvals. All consents, authorizations and approvals
of, and filings and registrations with, and all other actions in respect of, any
Governmental Authority or other Person required in connection with conduct of
the Designated Loan Parties' business shall have been obtained and shall be in
full force and effect.
Section 5.02 Conditions Precedent to All Loans and Letters of
Credit. The obligation of any Agent or any Lender to make any Senior Loan or of
the Administrative Agent to assist Allied Systems in establishing or opening any
Letter of Credit after the Effective Date is
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subject to the fulfillment, in a manner satisfactory to the Administrative
Agent, of each of the following conditions precedent:
(a) Payment of Fees, Etc. The Borrowers shall have paid
all fees, costs, expenses and taxes then payable by the Borrowers pursuant to
this Agreement and the other Loan Documents, including, without limitation,
Sections 2.06 and 12.04 hereof.
(b) Representations and Warranties; No Event of Default.
The following statements shall be true and correct, and the submission by Allied
Systems to the Administrative Agent of a Notice of Borrowing with respect to
each such Senior Loan, and Allied Systems, acceptance of the proceeds of such
Senior Loan, or the submission by Allied Systems of a Letter of Credit
Application with respect to a Letter of Credit, and the issuance of such Letter
of Credit, shall each be deemed to be a representation and warranty by each Loan
Party on the date of such Senior Loan or the date of issuance of such Letter of
Credit that: (i) the representations and warranties contained in Article VI and
in each other Loan Document, certificate or other writing delivered any Agent or
any Lender pursuant hereto or thereto on or prior to the date of such Senior
Loan or such Letter of Credit are true and correct on and as of such date as
though made on and as of such date (except that any representation and warranty
made as of a specific date shall be true and correct only as of such specific
date), (ii) at the time of and after giving effect to the making of such Senior
Loan and the application of the proceeds thereof or at the time of issuance of
such Letter of Credit, no Default or Event of Default has occurred and is
continuing or would result from the making of the Senior Loan to be made, or the
issuance of such Letter of Credit to be issued, on such date and (iii) the
conditions set forth in this Section 5.02 have been satisfied as of the date of
such request.
(c) Legality. The making of such Senior Loan or the
issuance of such Letter of Credit shall not contravene any law, rule or
regulation applicable to any Agent, any Lender or the L/C Issuer.
(d) Notices. The Administrative Agent shall have received
(i) a Notice of Borrowing pursuant to Section 2.02 hereof and (ii) a Letter of
Credit Application pursuant to Section 3.03 hereof, if applicable.
(e) Delivery of Documents. The Agents shall have received
such other agreements, instruments, approvals, opinions and other documents,
each in form and substance satisfactory to the Agents, as any Agent may
reasonably request.
(f) Proceedings; Receipt of Documents. All proceedings in
connection with the making of such Senior Loan or the issuance of such Letter of
Credit and the other transactions contemplated by this Agreement and the other
Loan Documents, and all documents incidental hereto and thereto, shall be
satisfactory to the Agents and their counsel, and the Agents and such counsel
shall have received all such information and such counterpart originals or
certified or other copies of such documents, in form and substance satisfactory
to the Agents, as the Agents or such counsel may reasonably request.
Section 5.03 Conditions Precedent to the Subordinated Term Loan D.
The obligation of each Subordinated Term Loan D Lender to exchange its
Subordinated Notes with the
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Subordinated Term Loan D Notes and make the such Subordinated Term Loan D
Lender's Subordinated Term Loan D Loan on the Effective Date is limited to the
fulfillment, in a manner satisfactory to such Subordinated Term Loan D Lender of
the following conditions precedent:
(a) Payment of Fees, Etc. The Borrowers shall have paid
on or before the date of this Agreement all costs and expenses then payable
under the Subordinated Term Loan D Notes.
(b) Representations and Warranties; No Event of Default.
The following statements shall be true and correct: (i) the representations and
warranties contained in Article VI and in each other Loan Document, certificate
or other writing delivered to any Subordinated Term Loan D Lender pursuant
hereto or thereto on or prior to the Effective Date are true and correct on and
as of the Effective Date as though made on and as of such date (except that any
representation and warranty made as of a specific date shall be true and correct
only as of such specific date) and (ii) no Default or Event of Default shall
have occurred and be continuing on the Effective Date or would result from this
Agreement or the other Loan Documents becoming effective in accordance with its
or their respective terms.
(c) Legality. The purchase by the Subordinated Term Loan
D Lender of the Subordinated Term Loan D Note, and the making of such
Subordinated Term Loan D Lender's Subordinated Term Loan D Loan, shall not
contravene any law, rule or regulation applicable to such Subordinated Term Loan
D Lender.
(d) Delivery of Documents. The Collateral Agent shall
have received (with a copy for each Subordinated Term Loan D Lender) on or
before the Effective Date the documents set forth in the following subclauses of
Section 5.01(d), each in form and substance satisfactory to the Collateral
Agent: (i), (ii), (iii), (iv), (v), (vii), (viii), (x), (xi), (xii), (xiii),
(xiv), (xv), (xvi), (xxiv), (xxxi) and (xxxiv), provided that, the deliveries
and/or requirements of any such subsections (other than subsection (xxxiv))
shall not be required under this Section 5.03(d) with respect to the
Subordinated Obligations to the extent that the Agents have waived the
deliveries and/or requirements of any such subsections with respect to the
Senior Obligations.
(e) Approvals. All consents, authorizations and approvals
of, and filings and registrations with, and all other actions in respect of, any
Governmental Authority or other Person required in connection with conduct of
the Designated Loan Parties' business shall have been obtained and shall be in
full force and effect.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
Section 6.01 Representations and Warranties. Each Loan Party
hereby represents and warrants to the Agents, the Lenders and the L/C Issuer as
follows:
(a) Organization, Good Standing, Etc. Each Loan Party (i)
is a corporation, limited liability company or limited partnership duly
organized, validly existing and in good standing under the laws of the state,
province or other applicable jurisdiction of its organization, (ii) has all
requisite power and authority to conduct its business as now conducted
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and as presently contemplated and, in the case of the Borrowers, to make the
borrowings hereunder, and to execute and deliver each Loan Document to which it
is a party, and to consummate the transactions contemplated thereby, and (iii)
is duly qualified to do business and is in good standing in each jurisdiction in
which the character of the properties owned or leased by it or in which the
transaction of its business makes such qualification necessary and where the
failure to be so qualified would reasonably be expected to have a Material
Adverse Effect.
(b) Authorization, Etc. The execution, delivery and
performance by each Loan Party of each Loan Document to which it is or will be a
party (including, without limitation, the notation of the Lien in favor of the
Collateral Agent on the certificates of title or ownership of the Rolling Stock
of the Parent and its Subsidiaries), (i) have been duly authorized by all
necessary action, (ii) do not and will not contravene its charter or by-laws,
its limited liability company or operating agreement or its certificate of
partnership or partnership agreement, as applicable, or any applicable law or
any contractual restriction binding on or otherwise affecting it or any of its
properties, (iii) do not and will not result in or require the creation of any
Lien (other than pursuant to any Loan Document) upon or with respect to any of
its properties, and (iv) do not and will not result in any default,
noncompliance, suspension, revocation, impairment, forfeiture or nonrenewal of
any permit, license, authorization or approval applicable to its operations or
any of its properties, which, in the case of this clause (iii), is reasonably
expected to have a Material Adverse Effect.
(c) Governmental Approvals. No authorization or approval
or other action by, and no notice to or filing with, any Governmental Authority
is required as a condition to the due execution, delivery and performance by any
Loan Party of any Loan Document to which it is or will be a party other than as
may be necessary to perfect the Liens created pursuant to the Loan Documents in
favor of the Collateral Agent.
(d) Enforceability of Loan Documents. This Agreement is,
and each other Loan Document to which any Loan Party is or will be a party, when
delivered hereunder, will be, a legal, valid and binding obligation of such
Person, enforceable against such Person in accordance with its terms, except as
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws and principles of equity.
(e) Subsidiaries. Schedule 6.01(e) is a complete and
correct description of the name, jurisdiction of incorporation and ownership of
the outstanding Capital Stock of each Loan Party and the Subsidiaries of each
Loan Party in existence on the date hereof. Except as indicated on such
Schedule, (i) all of the issued and outstanding shares of such Capital Stock
have been validly issued and are fully paid and nonassessable, and the holders
thereof are not entitled to any preemptive, first refusal or other similar
rights, (ii) all such Capital Stock is owned by the respective equityholders,
free and clear of all Liens, and (iii) there are no outstanding debt or equity
securities of any Loan Party or any of its Subsidiaries and no outstanding
obligations of any Loan Party or any of its Subsidiaries convertible into or
exchangeable for, or warrants, options or other rights for the purchase or
acquisition from such Loan Party or any of its Subsidiaries, or other
obligations of any Loan Party or any of its Subsidiaries to issue, directly or
indirectly, any shares of Capital Stock of such Loan Party or any of its
Subsidiaries.
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(f) Litigation; Commercial Tort Claims. Except as set
forth in Schedule 6.01(f), (i) there is no pending or written notices
threatening any action, suit or proceeding, affecting any Loan Party before any
court or other Governmental Authority or any arbitrator that (x) could
reasonably be expected to have a Material Adverse Effect or (y) relates to this
Agreement or any other Loan Document or any transaction contemplated hereby or
thereby and (ii) as of the Effective Date, none of the Designated Loan Parties
hold any commercial tort claims in respect of which a claim has been filed in a
court of law or a written notice by an attorney has been given to a potential
defendant.
(g) Financial Condition.
(i) The Financial Statements, copies of which
have been delivered to each Agent and each Senior Lender, fairly present the
consolidated financial condition of the Parent and its Subsidiaries as at the
respective dates thereof and the consolidated results of operations of the
Parent and its Subsidiaries for the fiscal periods ended on such respective
dates, all in accordance with GAAP, and since September 30, 2001 no event or
development has occurred that has had or could have a Material Adverse Effect.
(ii) The Parent has heretofore furnished to each
Agent and each Senior Lender (A) projected monthly balance sheets, income
statements and statements of cash flows of the Parent and its Subsidiaries for
the period from January 1, 2002, through December 31, 2003 and (B) projected
annual balance sheets, income statements and statements of cash flows of the
Parent and its Subsidiaries for the Fiscal Years ending in December 31, 2002
through December 31, 2004, which projected financial statements shall be updated
from time to time pursuant to Section 7.01(a)(vii). Such projections, as so
updated, shall be believed by the Parent at the time furnished to be reasonable,
shall have been prepared on a reasonable basis and in good faith by the Parent,
and shall have been based on assumptions believed by the Parent to be reasonable
at the time made and upon the best information then reasonably available to the
Parent, and the Parent shall not be aware of any facts or information that would
lead it to believe that such projections, as so updated, are incorrect or
misleading in any material respect.
(h) Compliance with Law, Etc. No Loan Party is
in violation of its organizational documents, any material law, rule, regulation
or judgment or any material order of any Governmental Authority (including,
without limitation, any Motor Vehicle Law) applicable to it or any of its
property or assets, or any term of any material agreement or instrument
(including, without limitation, any Material Contract) binding on or otherwise
affecting it or any of its properties, and no Default or Event of Default has
occurred and is continuing.
(i) ERISA; Canadian Plans. (i) Except as set
forth on Schedule 6.01(i), (A) each Employee Plan is in substantial compliance
with ERISA and the Internal Revenue Code, (B) no Termination Event has occurred
within six (6) years prior to the Effective Date nor is reasonably expected to
occur with respect to any Employee Plan, (C) the most recent annual report (Form
5500 Series) with respect to each Employee Plan, including any required Schedule
B (Actuarial Information) thereto, copies of which have been filed with the
appropriate Governmental Authority and delivered to the Agents, is complete and
correct and fairly presents the funding status of such Employee Plan, and since
the date of such report there has been no material adverse change in such
funding status, (D) copies of each agreement entered into with
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the PBGC, the U.S. Department of Labor or the Internal Revenue Service with
respect to any Employee Plan have been delivered to the Agents, (E) no Employee
Plan had an accumulated or waived funding deficiency or permitted decrease which
would create a deficiency in its funding standard account or has applied for an
extension of any amortization period within the meaning of Section 412 of the
Internal Revenue Code at any time during the previous 60 months, and (F) no Lien
imposed under the Internal Revenue Code or ERISA exists or is likely to arise on
account of any Employee Plan within the meaning of Section 412 of the Internal
Revenue Code. Except as set forth on Schedule 6.01(i), no Loan Party or any of
its ERISA Affiliates has incurred any withdrawal liability under ERISA with
respect to any Multiemployer Plan, or is aware of any facts indicating that it
or any of its ERISA Affiliates may in the future be reasonably likely to incur
any such withdrawal liability. To the best knowledge of any Loan Party or any of
its ERISA Affiliates, no Loan Party or any of its ERISA Affiliates nor any
fiduciary of any Employee Plan has (A) engaged in a nonexempt prohibited
transaction described in Sections 406 of ERISA or 4975 of the Internal Revenue
Code, (B) except as described on Schedule 6.01(i), failed to pay any required
installment or other payment required under Section 412 of the Internal Revenue
Code on or before the due date for such required installment or payment, (C)
engaged in a transaction within the meaning of Section 4069 of ERISA or (D)
incurred any liability to the PBGC which remains outstanding other than the
payment of premiums, and there are no premium payments which have become due
which are unpaid. There are no pending or written notices of any threatened
claims, actions, proceedings or lawsuits (other than claims for benefits in the
normal course), asserted or instituted against (A) any Employee Plan or its
assets, (B) any fiduciary with respect to any Employee Plan, or (C) any Loan
Party or any of its ERISA Affiliates with respect to any Employee Plan. Except
as set forth on Schedule 6.01(i) and except as required by Section 4980B of the
Internal Revenue Code, no Loan Party or any of its ERISA Affiliates maintains an
employee welfare benefit plan (as defined in Section 3(1) of ERISA) which
provides health or welfare benefits (through the purchase of insurance or
otherwise) for any retired or former employee of any Loan Party or any of its
ERISA Affiliates or coverage after a participant's termination of employment.
(ii) Except as set forth on Schedule 6.01(i),
each Canadian Plan is, and has been, established, registered (where required),
qualified, administered and invested, in substantial compliance with the terms
thereof, all applicable Canadian laws and regulations and Collective Bargaining
Agreements. Except as set forth on Schedule 6.01(i), no Loan Party or Canadian
Entity has received, in the last six (6) years, any notice from any Person
questioning or challenging such compliance beyond the last six (6) years. There
are no going concern unfunded actuarial liabilities, past service unfunded
liability or solvency deficiencies with respect to the Canadian Plans that are
registered pension plans. No material changes have occurred in respect of any
Canadian Plan since the date of the most recent financial, accounting or
actuarial or other report, as applicable, filed with any Governmental Authority
in connection with any of the Canadian Plans, nor have there been any events
occurring prior to the most recent financial, accounting or actuarial or other
report which is not disclosed in such report, which should have been disclosed
in such report, and which could reasonably be expected to adversely affect the
relevant report (including rendering it misleading in any material respect) or
to have materially affected the financial status of such Canadian Plan. There
are no outstanding material defaults or violations under the Canadian Plans and
to the best knowledge of the Loan Parties, there are no material defaults or
violations by any other party to the Canadian Plans. There are no
investigations, litigation, administrative or other proceedings, actions, suits
or claims (other than
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routine claims for benefits) pending or threatened, in writing, with respect to
the Canadian Plans. All contributions or premiums required to be paid to or in
respect of the Canadian Plans have been paid in accordance with the terms
thereof and all applicable Canadian laws and regulations, and there are no taxes
owing or exigible under the Canadian Plans. Except as set forth on Schedule
6.01(i), no event has occurred nor is reasonably expected to occur with respect
to the Canadian Plans which would entitle any Person (without the consent of the
Loan Parties) to wind-up or terminate any Canadian Plan, in whole or in part, or
which could adversely affect the tax status thereof. There has been no improper
withdrawal, or transfer of assets, from the Canadian Plans, other than benefit
payments or payment of permitted expenses. Except as set forth on Schedule
6.01(i), none of the Canadian Plans, other than the pension plans, provide
benefits beyond retirement or other termination of service to employees or
former employees or to the beneficiaries or dependants of such employees. The
sole obligation of any Canadian Entity to or in respect of the Canadian Plans is
to make monetary contributions to the Canadian MEPP in the amounts and in the
manner set forth in the Collective Bargaining Agreements disclosed to the
Collateral Agent.
(j) Taxes, Etc. All Federal, state, federal government of
Canada, provincial and local tax returns and other reports required by
applicable law to be filed by any Designated Loan Party have been filed, or
extensions have been obtained, and all taxes, assessments and other governmental
charges imposed upon any Designated Loan Party or any property of any Designated
Loan Party and which have become due and payable on or prior to the date hereof
have been paid, except to the extent contested in good faith by proper
proceedings which stay the imposition of any penalty, fine or Lien resulting
from the non-payment thereof and with respect to which adequate reserves have
been set aside for the payment thereof in the Financial Statements in accordance
with GAAP.
(k) Regulations T, U and X. No Loan Party is or will be
engaged in the business of extending credit for the purpose of purchasing or
carrying margin stock (within the meaning of Regulation T, U or X), and no
proceeds of any Loan will be used to purchase or carry any margin stock or to
extend credit to others for the purpose of purchasing or carrying any margin
stock.
(l) Nature of Business. Except as otherwise described in
this Section, no Loan Party or any of its Subsidiaries is engaged in any
business other than the motor carrier business specializing in transportation of
new and used automobiles and light trucks utilizing specialized tractor
trailers. The Axis Entities provide logistics and distribution services to the
new and used vehicle distribution market and other segments of the automobile
industry. AH Industries has no assets other than intercompany notes receivables
and other assets with a fair market value not in excess of $50,000 and has no
liabilities other than intercompany notes made by Subsidiaries of the Parent
payable to the Parent which were transferred by the Parent to AH Industries and
does not conduct and is not engaged in any business activities other than such
business and activities as they relate to the holder of such intercompany notes.
Haul Insurance has no assets or liabilities other than an intercompany note
receivable related to the Axis Netherlands L/C and those associated with the
provision of insurance and services related thereto, and does not conduct and is
not engaged in any business activities other than such business and activities
as they relate to the provision of insurance and services related thereto
substantially all of which insurance and related services are provided for the
benefit of the Parent
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or its Subsidiaries. The insurance and related services of Haul Insurance not
provided for the benefit of the Parent or its Subsidiaries are provided to third
parties and the insurance premiums charged and collected with respect thereto
are segregated from any cash or other assets of the Parent and its other
Subsidiaries. Haul Insurance has taken the appropriate measures (through
reinsurance and other appropriate means) to reduce the insurance risk and
exposure relating to such third party insurance to an amount not in excess of
the capital provided to support such activities.
(m) Adverse Agreements, Etc. No Loan Party is a party to
any agreement or instrument, or subject to any charter, limited liability
company agreement, partnership agreement or other corporate, partnership or
limited liability company restriction or any judgment, order, regulation, ruling
or other requirement of a court or other Governmental Authority, which has, or
in the future could have, a Material Adverse Effect.
(n) Permits, Etc. (i) Each Designated Loan Party has, and
is in compliance with, all permits, licenses, authorizations, approvals,
entitlements and accreditations required for such Person lawfully to own, lease,
manage or operate, or to acquire, each business currently owned, leased, managed
or operated, or to be acquired, by such Person except where the failure to have
or be in compliance with such permits, licenses, authorizations, approvals
entitlements or accreditations is not reasonably expected to have a Material
Adverse Effect. No condition exists or event has occurred which, in itself or
with the giving of notice or lapse of time or both, would result in the
suspension, revocation, impairment, forfeiture or non-renewal of any such
permit, license, authorization, approval, entitlement or accreditation, and
there is no claim that any thereof is not in full force and effect.
(ii) Each Designated Loan Party has all
certificates of convenience and necessity and operating rights necessary to
conduct interstate and intrastate transportation businesses consisting of
transporting automobiles and light trucks in, between and among the states of
the United States in which such Loan Party operates. Each of such certificates
of convenience and necessity and operating rights existing as of the Effective
Date is listed on Schedule 6.01(n), and is in good standing, in full force and
effect and being held and operated by such Person in accordance with the terms
thereof. Each Designated Loan Party has all operating authorizations necessary
or desirable under Canadian law for the conduct the inter-provincial and
intra-provincial transportation business of each such Person. Each such
operating authorization existing as of the Effective Date is listed on Schedule
6.01(n), and is in good standing, in full force and effect and being held and
operated by such Person in accordance with the terms thereof.
(o) Properties. Each Designated Loan Party has good and
marketable title to, valid leasehold interests in, or valid licenses to use, all
property and assets material to its business, free and clear of all Liens,
except, with respect to all Facilities subject to a Mortgage, those exceptions
set forth in the applicable Title Insurance Policy and, with respect to all
other property and assets, any Permitted Lien. All such properties and assets
are in good working order and condition, ordinary wear and tear excepted.
(ii) Schedule 6.01(o) sets forth a complete and
accurate list, as of the Effective Date, of the location, by state and street
address, of all real property owned or
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leased by each Loan Party. As of the Effective Date, each Loan Party has valid
leasehold interests in the Leases described on Schedule 6.01(o) to which it is a
party. Schedule 6.01(o) sets forth with respect to each such Lease, as of the
Effective Date, the commencement date, termination date, renewal options (if
any) and annual base rents. Except with respect to any Lease that is not
material to the business of Allied Systems or Allied Canada, individually, or of
the Designated Loan Parties taken as a whole, each Lease is valid and
enforceable in accordance with its terms in all material respects and is in full
force and effect. With respect to any Lease that is material to the business of
Allied Systems or Allied Canada, individually, or of the Designated Loan Parties
taken as a whole, no consent or approval of any landlord or other third party in
connection with any such Lease is necessary for any Loan Party to enter into and
execute the Loan Documents to which it is a party, except as set forth on
Schedule 6.01(o). With respect to any Lease that is material to the business of
Allied Systems or Allied Canada, individually, or of the Designated Loan Parties
taken as a whole, to the best knowledge of any Loan Party, no other party to any
such Lease is in default of its obligations thereunder, and no Designated Loan
Party (or any other party to any such Lease) has at any time delivered or
received any notice of default which remains uncured under any such Lease and,
as of the Effective Date, no event has occurred which, with the giving of notice
or the passage of time or both, would constitute a default under any such Lease.
(iii) All Rolling Stock of the Designated Loan
Parties which, under applicable law (including, without limitation, any Motor
Vehicle Law), is required to be registered is properly registered in the name of
a Loan Party, and all Rolling Stock of the Designated Loan Parties, the
ownership of which, under applicable law (including, without limitation, any
Motor Vehicle Law), is evidenced by a certificate of title or ownership, is
properly titled in the name of a Loan Party. The Rolling Stock listed on
Schedule 5.01(d)(xxx) constitute all of the Rolling Stock owned by the
Designated Loan Parties on the Effective Date and the Rolling Stock not subject
to a certificate of title or ownership under applicable law (including, without
limitation, any Motor Vehicle Law) is noted therein.
(p) Full Disclosure. Each Loan Party has disclosed to the
Agents all agreements, instruments and corporate or other restrictions to which
it is subject, and all other matters known to it, that, individually or in the
aggregate, could result in a Material Adverse Effect. None of the other reports,
financial statements, certificates or other information furnished by or on
behalf of any Loan Party to the Agents in connection with the negotiation of
this Agreement or delivered hereunder (as modified or supplemented by other
information so furnished) contains any material misstatement of fact or omits to
state any material fact necessary to make the statements therein, in the light
of the circumstances under which it was made, not misleading; provided that,
with respect to projected financial information, each Loan Party represents only
that such information was prepared in good faith based upon assumptions believed
to be reasonable at the time. There is no contingent liability or fact that may
have a Material Adverse Effect which has not been set forth in a footnote
included in the Financial Statements or a Schedule hereto.
(q) Operating Lease Obligations. On the Effective Date,
other than (i) the Operating Lease Obligations set forth on Schedule 6.01(q) and
(ii) other Operating Lease Obligations which require the payment of not more
than $50,000 for any individual lease and
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$250,000 for all such leases in the aggregate, none of the Loan Parties has any
Operating Lease Obligation.
(r) Environmental Matters. Except as set forth on
Schedule 6.01(r), (i) the operations of each Loan Party are in compliance with
all Environmental Laws, except where the failure to be in compliance is not
reasonably likely to result in a Material Adverse Effect; (ii) there has been no
Release at any of the properties owned or operated by any Loan Party or a
predecessor in interest, or, to the knowledge of the Loan Parties, at any
disposal or treatment facility which received Hazardous Materials generated by
any Loan Party or any predecessor in interest which is reasonably likely to have
a Material Adverse Effect; (iii) no Environmental Action has been asserted
against any Loan Party or any predecessor in interest nor does any Loan Party
have knowledge or written notice of any threatened or pending Environmental
Action against any Loan Party or any predecessor in interest which is reasonably
likely to have a Material Adverse Effect; (iv) no Environmental Actions have
been asserted or are continuing against any facilities that may have received
Hazardous Materials generated by any Loan Party or any predecessor in interest,
for which any Loan Party has received notice, which is reasonably likely to have
a Material Adverse Effect; (v) no property now or formerly owned or operated by
a Loan Party has been or was used as a treatment or disposal site for any
Hazardous Material during the period of such Loan Party's ownership or
operation; (vi) no Loan Party has failed to report to the proper Governmental
Authority the occurrence of any Release which is required to be so reported by
any Environmental Law which is reasonably likely to have a Material Adverse
Effect; (vii) each Loan Party holds all licenses, permits and approvals required
under any Environmental Law in connection with the operation of the business
carried on by it, except for such licenses, permits and approvals as to which a
Loan Party's failure to maintain or comply with is not reasonably likely to have
a Material Adverse Effect; and (viii) except as is not reasonably likely to have
a Material Adverse Effect, no Loan Party has received any notification pursuant
to any Environmental Law that (A) any work, repairs, construction or Capital
Expenditures are required to be made in respect as a condition of continued
compliance with any Environmental Law, or any license, permit or approval issued
pursuant thereto or (B) any license, permit or approval referred to above is
about to be reviewed, made, subject to limitations or conditions, revoked,
withdrawn or terminated.
(s) Insurance. Each Loan Party keeps its property
adequately insured and maintains (i) insurance to such extent and against such
risks, including fire, as is customary with companies in the same or similar
businesses, (ii) workmen's compensation insurance in the amount required by
applicable law, (iii) commercial general liability insurance, which shall
include product liability insurance, in the amount customary with companies in
the same or similar business against claims for personal injury or death on
properties owned, occupied or controlled by it, (iv) insurance with respect to
liability for bodily injury and property damage resulting from the operation of
the Rolling Stock by the Parent or any of its Subsidiaries in amounts customary
with companies in the same or similar business and in accordance with applicable
law and (v) such other insurance as may be required by law or as may be
reasonably required by the Collateral Agent (including, without limitation,
against larceny, embezzlement or other criminal misappropriation). Schedule
6.01(s) sets forth a list of all insurance maintained by each Loan Party on the
Effective Date.
(t) Use of Proceeds. The proceeds of the Senior Loans
shall be used to (a) refinance existing indebtedness of the Parent under the
Existing Credit Facility in the principal
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amount of up to $93,803,090.26, (b) pay fees and expenses in connection with the
transactions contemplated hereby, and (c) fund working capital of the Loan
Parties. Up to $8,000,000 of the proceeds of the Term Loan C and up to
$3,591,987.86 of the proceeds from the Revolving Loans shall be used to repay
the Subordinated Notes. The remaining $3,000,000 of the principal amount of the
Term Loan C shall constitute the Term Loan C Fee capitalized on the Effective
Date. The Subordinated Notes will be purchased, in part, from the issuance of
the Subordinated Term Loan D Notes. The Letters of Credit will be used for to
support the Canadian Facility, certain cash management arrangements of the Loan
Parties and for other general working capital purposes.
(u) Solvency. After giving effect to the transactions
contemplated by this Agreement and before and after giving effect to each Loan
and Letter of Credit, each of Allied Systems and Allied Canada individually is,
and the Loan Parties on a consolidated basis are, Solvent.
(v) Location of Bank Accounts. Schedule 6.01(v) sets
forth a complete and accurate list as of the Effective Date of all deposit,
checking and other bank accounts, all securities and other accounts maintained
with any broker dealer and all other similar accounts maintained by each Loan
Party, together with a description thereof (i.e., the bank or broker dealer at
which such deposit or other account is maintained and the account number and the
purpose thereof).
(w) Intellectual Property. Except as set forth on
Schedule 6.01(w), each Designated Loan Party owns or licenses or otherwise has
the right to use all licenses, permits, patents, patent applications,
trademarks, trademark applications, service marks, tradenames, copyrights,
copyright applications, franchises, authorizations, non-governmental licenses
and permits and other intellectual property rights that are necessary for the
operation of its business, without infringement upon or conflict with the rights
of any other Person with respect thereto, except for such infringements and
conflicts which, individually or in the aggregate, is not reasonably likely to
have a Material Adverse Effect. Set forth on Schedule 6.01(w) is a complete and
accurate list as of the Effective Date of all such material licenses, permits,
patents, patent applications, trademarks, trademark applications, service marks,
tradenames, copyrights, copyright applications, franchises, authorizations,
non-governmental licenses and permits and other intellectual property rights of
each Designated Loan Party. No slogan or other advertising device, product,
process, method, substance, part or other material now employed, or now
contemplated to be employed, by any Loan Party infringes upon or conflicts with
any rights owned by any other Person, and no claim or litigation regarding any
of the foregoing is pending or threatened, in writing, except for such
infringements and conflicts which is not reasonably likely to have, individually
or in the aggregate, a Material Adverse Effect. To the best knowledge of each
Loan Party, no patent, invention, device, application, principle or any statute,
law, rule, regulation, standard or code is pending or proposed, which,
individually or in the aggregate, is not reasonably likely to have a Material
Adverse Effect.
(x) Material Contracts. Set forth on Schedule 6.01(x) is
a complete and accurate list as of the Effective Date of all Material Contracts
of each Loan Party, showing the parties and subject matter thereof and
amendments and modifications thereto. Each such Material Contract (i) is in full
force and effect and is binding upon and enforceable against each Loan Party
that is a party thereto and, to the best knowledge of such Loan Party, all other
parties thereto in
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accordance with its terms, (ii) has not been otherwise amended or modified
except to the extent permitted by the terms of this Agreement, and (iii) is not
in default due to the action of any Loan Party or, to the best knowledge of any
Loan Party, any other party thereto.
(y) Holding Company and Investment Company Acts. None of
the Loan Parties is (i) a "holding company" or a "subsidiary company" of a
"holding company" or an "affiliate" of a "holding company", as such terms are
defined in the Public Utility Holding Company Act of 1935, as amended, or (ii)
an "investment company" or "controlled by" an "investment company", as such
terms are defined in the Investment Company Act of 1940, as amended.
(z) Employee and Labor Matters. There is (i) no unfair
labor practice complaint pending or threatened, in writing, against any Loan
Party before any Governmental Authority and no grievance or arbitration
proceeding pending or threatened, in writing, against any Loan Party which
arises out of or under any Collective Bargaining Agreement, which in any such
case is reasonably likely to have a Material Adverse Effect, (ii) no strike,
labor dispute, slowdown, stoppage or similar action or grievance pending or
threatened against any Loan Party which in any such case is reasonably likely to
have a Material Adverse Effect, or (iii) to the best knowledge of any Loan
Party, no union representation question existing with respect to the employees
of any Loan Party and no union organizing activity taking place with respect to
any of the employees of any Loan Party. No Loan Party or any of its ERISA
Affiliates has incurred any liability or obligation under the Worker Adjustment
and Retraining Notification Act ("WARN") or similar state law, which remains
unpaid or unsatisfied. The hours worked and payments made to employees of any
Loan Party have not been in violation of the Fair Labor Standards Act or any
other applicable legal requirements. All material payments due from any Loan
Party on account of wages and employee health and welfare insurance and other
benefits have been paid or accrued as a liability on the books of such Loan
Party.
(aa) Customers and Suppliers. There exists no actual or
written notice threatening termination, cancellation or limitation of, or
modification to or change in, the business relationship between (i) any Loan
Party, on the one hand, and any customer or any group thereof, on the other
hand, whose agreements with any Loan Party are individually or in the aggregate
material to the business or operations of such Loan Party, or (ii) any Loan
Party, on the one hand, and any material supplier thereof, on the other hand.
(bb) No Bankruptcy Filing. No Loan Party is contemplating
either an Insolvency Proceeding or the liquidation of all or a major portion of
such Loan Party's assets or property, and no Loan Party has any knowledge of any
Person contemplating an Insolvency Proceeding against it.
(cc) Location of Rolling Stock; Place of Business; Chief
Executive Office; FEIN; Organizational ID Number. There is no location at which
any Designated Loan Party has based any Rolling Stock (except for Rolling Stock
in transit) other than (i) those locations listed on Schedule 6.01(cc) and (ii)
any other locations approved in writing by the Collateral Agent pursuant to the
definition of "Eligible Rolling Stock". Schedule 6.01(cc) hereto contains a
true, correct and complete list, as of the Effective Date, of the legal names
and addresses of each location at which Rolling Stock of each Designated Loan
Party is based.
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Schedule 6.01(cc) sets forth a complete and accurate list as of the date hereof
of (i) each place of business of each Loan Party and each of its Subsidiaries,
(ii) the chief executive office of each Loan Party and each of its Subsidiaries,
(iii) the federal employer identification number of each Loan Party and each of
its Subsidiaries, and (iv) the jurisdiction of organization of each Loan Party
and the organizational identification number of each Loan Party (or indicates
that such Loan Party has no such number).
(dd) Tradenames. Schedule 6.01(dd) hereto sets forth a
complete and accurate list as of the Effective Date of all tradenames used by
each Designated Loan Party.
(ee) Security Interests. (i) Each Security Agreement
creates in favor of the Collateral Agent, for the benefit of the Lenders, a
legal, valid and enforceable security interest in the Collateral identified
therein. Upon the filing of the UCC-1 financing statements described in Section
5.01(d)(viii), the recording of the Collateral Assignments for Security referred
to in each Security Agreement in the United States Patent and Trademark Office
and the United States Copyright Office, as applicable, and the submission of an
appropriate application requesting that the Lien of the Collateral Agent be
noted on the certificate of title or ownership, completed and authenticated by
the applicable Loan Party, together with the certificate of title or ownership,
with respect to such Rolling Stock, to the applicable state agency, and the
recording of the filings required under any other similar law of any foreign
jurisdiction, such security interests in and Liens on the Collateral granted
thereby shall be perfected, first priority security interests, and no further
recordings or filings are or will be required in connection with the creation,
perfection or enforcement of such security interests and Liens, other than (i)
the filing of continuation statements in accordance with applicable law, (ii)
the recording of the Collateral Assignments for Security pursuant to each
Security Agreement in the United States Patent and Trademark Office and the
United States Copyright Office, as applicable, with respect to after-acquired
U.S. patent and trademark applications and registrations and U.S. copyrights,
(iii) the registration of any unregistered copyrights with the United States
Copyright Office and (iv) the recordation of appropriate evidence of the
security interest in the appropriate foreign registry with respect to all
foreign intellectual property.
(ii) Each Canadian Security Agreement creates in
favor of the Collateral Agent, for the benefit of the Lenders, a legal, valid
and enforceable security interest in the Collateral secured thereby. Upon the
filing of the PPSA financing statements described in Section 5.01(d)(viii) and
the recording of the Canadian Security Agreement in the Canadian Intellectual
Property Office, such Liens on the Collateral granted thereby shall be
perfected, first priority security interests, and no further recordings or
filings are or will be required in connection with the creation, perfection or
enforcement of such Liens, other than (i) the filing of continuation statements
in accordance with applicable law, (ii) the recording of the Canadian Security
Agreement in the Canadian Intellectual Property Office with respect to
after-acquired Canadian intellectual property and (iii) the recordation of
appropriate evidence of the Lien on the appropriate foreign registry with
respect to all foreign intellectual property.
(ff) Schedules. All of the information which is required
to be scheduled to this Agreement is set forth on the Schedules attached hereto,
is correct and accurate in all material respects and does not omit to state any
information required therein.
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(gg) Representations and Warranties in Documents; No
Default. All representations and warranties set forth in this Agreement and the
other Loan Documents are true and correct in all respects at the time as of
which such representations were made and on the Effective Date. No Event of
Default has occurred and is continuing and no condition exists which constitutes
a Default or an Event of Default.
(hh) Other Indebtedness. The Obligations constitute
"Permitted Debt" under clause (i) of the second paragraph of Section 4.09 of the
Indenture and, on the Effective Date, there are no outstanding Capital Lease
Obligations (as defined in the Indenture) incurred under clause (i) of the
second paragraph of Section 4.09 of the Indenture.
(ii) Rolling Stock Appraisal. The sample of Eligible
Rolling Stock that was appraised prior to the Effective Date to determine the
Orderly Liquidation Values of such Eligible Rolling Stock is a representative
sample of the type, quality, condition and age of all Eligible Rolling Stock on
the Effective Date.
(jj) Guarantors. On the Effective Date, each "Guarantor"
(as such term is defined in the Indenture) is a Guarantor.
ARTICLE VII
COVENANTS OF THE LOAN PARTIES
Section 7.01 Affirmative Covenants. So long as any principal of or
interest on any Senior Loan, Reimbursement Obligation, Letter of Credit
Obligation or any other Senior Obligation (whether or not due) shall remain
unpaid or any Senior Lender shall have any Commitment hereunder, the Parent
will, and will cause each of its Subsidiaries or the Designated Loan Parties, as
applicable, to, unless the Required Lenders shall otherwise consent in writing:
(a) Reporting Requirements. Furnish to each Agent and
each Senior Lender:
(i) as soon as available and in any event within
45 days after the end of each of the first three fiscal quarters of each Fiscal
Year of the Parent commencing March 31, 2002, consolidated and consolidating
balance sheets, consolidated and consolidating statements of operations and
retained earnings and consolidated statements of cash flows of the Parent and
its Subsidiaries as at the end of such quarter, and for the period commencing at
the end of the immediately preceding Fiscal Year and ending with the end of such
quarter, setting forth in each case in comparative form the figures for the
corresponding date or period of the immediately preceding Fiscal Year, all in
reasonable detail and certified by an Authorized Officer of the Parent as fairly
presenting, in all material respects, the financial position of the Parent and
its Subsidiaries as of the end of such quarter and the results of operations and
cash flows of the Parent and its Subsidiaries for such quarter, in accordance
with GAAP applied in a manner consistent with that of the most recent audited
financial statements of the Parent and its Subsidiaries furnished to the Agents
and the Senior Lenders, subject to normal year-end adjustments;
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(ii) as soon as available, and in any event
within 90 days after the end of each Fiscal Year of the Parent and its
Subsidiaries, consolidated and consolidating balance sheets, consolidated and
consolidating statements of operations and retained earnings and consolidated
statements of cash flows of the Parent and its Subsidiaries as at the end of
such Fiscal Year, setting forth in each case in comparative form the
corresponding figures for the immediately preceding Fiscal Year, all in
reasonable detail and prepared in accordance with GAAP, and, in the case of such
consolidated financial statements, accompanied by a report and an unqualified
opinion, prepared in accordance with generally accepted auditing standards, of
independent certified public accountants of recognized national standing
selected by the Parent and satisfactory to the Agents in their reasonable
business judgment (which opinion shall be without (A) a "going concern" or like
qualification or exception, (B) any qualification or exception as to the scope
of such audit, or (C) any qualification which relates to the treatment or
classification of any item and which, as a condition to the removal of such
qualification, would require an adjustment to such item, the effect of which
would be to cause any noncompliance with the provisions of Section 7.03,
together with a written statement of such accountants (1) to the effect that, in
making the examination necessary for their certification of such financial
statements, they have not obtained any knowledge of the existence of an Event of
Default or a Default and (2) if such accountants shall have obtained any
knowledge of the existence of an Event of Default or such Default, describing
the nature thereof;
(iii) as soon as available, and in any event
within 30 days after the end of each fiscal month of the Parent and its
Subsidiaries commencing February 28, 2002, internally prepared consolidated and
consolidating balance sheets, consolidated and consolidating statements of
operations and retained earnings and consolidated statements of cash flows as at
the end of such fiscal month, and for the period commencing at the end of the
immediately preceding Fiscal Year and ending with the end of such fiscal month,
all in reasonable detail and certified by an Authorized Officer of the Parent as
fairly presenting, in all material respects, the financial position of the
Parent and its Subsidiaries as at the end of such fiscal month and the results
of operations, retained earnings and cash flows of the Parent and its
Subsidiaries for such fiscal periods, in accordance with GAAP applied in a
manner consistent with that of the most recent audited financial statements
furnished to the Agents and the Senior Lenders, subject to normal year-end
adjustments; provided, however, that if the end of such fiscal month is also the
end of a fiscal quarter or the end of a Fiscal Year, such report shall be
delivered in accordance with Section 7.01(a)(i) or Section 7.01(a)(ii), as
appropriate;
(iv) simultaneously with the delivery of the
financial statements of the Parent and its Subsidiaries required by clauses (i),
(ii) and (iii) of this Section 7.01(a), a certificate of an Authorized Officer
of the Parent (A) stating that such Authorized Officer has reviewed the
provisions of this Agreement and the other Loan Documents and has made or caused
to be made under his or her supervision a review of the condition and operations
of the Parent and its Subsidiaries during the period covered by such financial
statements with a view to determining whether the Parent and its Subsidiaries
were in compliance with all of the provisions of this Agreement and such Loan
Documents at the times such compliance is required hereby and thereby, and that
such review has not disclosed, and such Authorized Officer has no knowledge of,
the existence during such period of an Event of Default or Default or, if an
Event of Default or Default existed, describing the nature and period of
existence thereof and the action
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which the Parent and its Subsidiaries propose to take or have taken with respect
thereto and (B) attaching a schedule showing the calculations specified in
Section 7.03;
(v) as soon as available and in any event within
15 days after the end of each fiscal month of the Parent and its Subsidiaries
commencing February 28, 2002, reports in form and detail satisfactory to the
Agents and certified by an Authorized Officer of the Administrative Borrower as
being accurate and complete (A) listing all Accounts Receivable of the
Designated Loan Parties as of such month end date, which shall include, prior to
the implementation of the electronic collateral reporting system pursuant to
Section 7.01(q), a summary report of the amount of all Accounts Receivable more
than 30, 60, 90 and 120 days old, and, after the implementation of the
electronic collateral reporting system pursuant to Section 7.01(q), the amount
and age of each Account Receivable, showing separately (by invoice and due date)
those which are more than 30, 60, 90 and 120 days old and a description of all
Liens, set-offs, defenses and counterclaims with respect thereto, together with
a reconciliation of such schedule with the schedule delivered to the Agents
pursuant to this clause (v)(A) for the immediately preceding fiscal month, the
name and mailing address of each Account Debtor with respect to each such
Account Receivable and such other information as any Agent may request, (B)
listing all accounts payable of the Designated Loan Parties as of each such day
which shall include the amount and age of each account payable, the name and
mailing address of each account creditor and such other information as any Agent
may request, (C) upon request by any Agent, a statement of the balance of each
of the intercompany Accounts, (D) such information and reports relating to the
Facilities as any Agent shall reasonably request from time to time, (E) with
respect to the Rolling Stock of the Loan Parties, a certificate setting forth,
as of the end of the previous fiscal month and for the portion of the Fiscal
Year then ended, (1) a summary report of the Rolling Stock of the Loan Parties
(differentiating with respect to Eligible Rolling Stock and all other Rolling
Stock), indicating changes in value and depreciation amounts, (2) a list of
Rolling Stock of the Designated Loan Parties purchased or otherwise acquired
during such period, setting forth the following information: the date of
acquisition, the manufacturer, the year made, the model, the vehicle
identification number, the state in which it is licensed, the license number,
the owner, state in which it is titled and the certificate of title or ownership
identification number, together with a copy of the invoice, purchase order,
registration or other document setting forth the vehicle identification number
of such vehicle, which list shall supplement and update Schedule 5.01(d)(xxx),
(3) a list of Rolling Stock of the Designated Loan Parties sold or contracted
for sale during such period, (4) the Dollar amount spent on such purchases or
acquisitions during such period, (5) a report reconciling the records of the
Loan Parties against the most recent report of the Rolling Stock Collateral
Custodian with respect to the Rolling Stock and (6) any other information
relating to the Rolling Stock as the Agents may reasonably request, (F) a
schedule setting forth all outstanding Capitalized Lease Obligations (as defined
in the Indenture) incurred under clause (i) of the second paragraph of Section
4.09 of the Indenture, (G) a schedule setting forth a reasonably detailed
calculation of the amount of Indebtedness that may be incurred by the Parent and
its Subsidiaries under subclause (i)(2) of the second paragraph of Section 4.09
of the Indenture, and (H) a schedule of borrowings and repayments under the
Canadian Facility during the previous month;
(vi) as soon as available and in any event by
Thursday of each week commencing with the first week ending after the Effective
Date, a Borrowing Base Certificate, current as of the close of business on the
Saturday of the immediately preceding
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week supported by schedules showing the derivation thereof and containing such
detail and other information as any Agent may request from time to time,
provided that (A) the Borrowing Base set forth in the Borrowing Base Certificate
(1) shall be effective from and including the date such Borrowing Base
Certificate is duly received by the Agents but not including the date on which a
subsequent Borrowing Base Certificate is received by the Agents, unless any
Agent disputes the eligibility of any property included in the calculation of
the Borrowing Base or the valuation thereof by notice of such dispute to the
Administrative Borrower, (2) shall, with respect to setoffs, defenses,
counterclaims or contras related to Accounts Receivable of the Designated Loan
Parties, be updated not less frequently than monthly and (3) shall, with respect
to Eligible Rolling Stock, be updated not less frequently than monthly and (B)
in the event of any dispute about the eligibility of any property included in
the calculation of the Borrowing Base or the valuation thereof, such Agent's
good faith judgment shall control;
(vii) (A) on or before December 15th of each year,
financial projections, supplementing and superseding the financial projections
for such period referred to in Section 6.01(g)(ii)(A), prepared on a monthly
basis and otherwise in form and substance satisfactory to the Agents, for the
immediately succeeding Fiscal Year for the Parent and its Subsidiaries and (B)
for Fiscal Year 2002, on or before thirty days prior to the end of the second
and third fiscal quarter of such Fiscal Year and for each of the first three
fiscal quarters of all subsequent Fiscal Years, financial projections,
supplementing and superseding the financial projections for such period referred
to in Section 6.01(g)(ii)(B), prepared on a monthly basis and otherwise in form
and substance satisfactory to the Agents, for each remaining quarterly period in
such Fiscal Year, all such financial projections to be reasonable, to be
prepared on a reasonable basis and in good faith, and to be based on assumptions
believed by the Parent to be reasonable at the time made and from the best
information then available to the Parent;
(viii) promptly after submission to
any Governmental Authority, all documents and information furnished to such
Governmental Authority in connection with any investigation of any Loan Party
other than routine inquiries by such Governmental Authority;
(ix) as soon as possible, and in any event within
3 days after the occurrence of an Event of Default or Default or the occurrence
of any event or development that could have a Material Adverse Effect, the
written statement of an Authorized Officer of the Administrative Borrower
setting forth the details of such Event of Default or Default or other event or
development having a Material Adverse Effect and the action which the affected
Loan Party proposes to take with respect thereto;
(x) (A) as soon as possible and in any event
within 10 days after any Loan Party or any ERISA Affiliate thereof knows or has
reason to know that (1) any Reportable Event with respect to any Employee Plan
has occurred, (2) any other Termination Event with respect to any Employee Plan
has occurred, or (3) an accumulated funding deficiency has been incurred or an
application has been made to the Secretary of the Treasury for a waiver or
modification of the minimum funding standard (including installment payments) or
an extension of any amortization period under Section 412 of the Internal
Revenue Code with respect to an Employee Plan, a statement of an Authorized
Officer of the Administrative Borrower setting forth the details of such
occurrence and the action, if any, which such Loan Party or such ERISA Affiliate
proposes to take with respect thereto, (B) promptly and in any
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event within three days after receipt thereof by any Loan Party or any ERISA
Affiliate thereof from the PBGC, copies of each notice received by any Loan
Party or any ERISA Affiliate thereof of the PBGC's intention to terminate any
Plan or to have a trustee appointed to administer any Plan, (C) promptly and in
any event within 10 days after the filing thereof with the appropriate
Governmental Authority if requested by any Agent, copies of each Schedule B
(Actuarial Information) to the annual report (Form 5500 Series) with respect to
each Employee Plan and Multiemployer Plan, (D) promptly and in any event within
10 days after any Loan Party or any ERISA Affiliate thereof knows or has reason
to know that a required installment within the meaning of Section 412 of the
Internal Revenue Code has not been made when due with respect to an Employee
Plan, (E) promptly and in any event within 3 days after receipt thereof by any
Loan Party or any ERISA Affiliate thereof from a sponsor of a Multiemployer Plan
or from the PBGC, a copy of each notice received by any Loan Party or any ERISA
Affiliate thereof concerning the imposition or amount of withdrawal liability
under Section 4202 of ERISA or indicating that such Multiemployer Plan may enter
reorganization status under Section 4241 of ERISA, and (F) promptly and in any
event within 10 days after any Loan Party or any ERISA Affiliate thereof sends
notice of a plant closing or mass layoff (as defined in WARN) to employees,
copies of each such notice sent by such Loan Party or such ERISA Affiliate
thereof;
(xi) as soon as possible and in any event within
10 days after any Loan Party knows or has reason to know that (A) a notice from
any Person questioning or challenging the compliance of the Canadian Plans with
(1) the terms thereof (2) all applicable Canadian laws and regulations or (3)
any applicable Collective Bargaining Agreement (other than in respect of any
claim related solely to that Person) has been delivered to any Loan Party or to
a Governmental Authority; (B) a contribution or premium required to be paid to
or in respect of the Canadian Plans has not been paid in accordance with the
terms thereof, all applicable Canadian laws and regulations, or any applicable
Collective Bargaining Agreement or that taxes or material penalties or fees are
owing or exigible under the Canadian Plans; (C) an investigation, litigation,
administrative or other proceeding, action, suit or claim (other than routine
claims for benefits) is pending or written notice thereof is threatened
involving the Canadian Plans or its assets; (D) an event (other than as
described on Schedule 6.01(i)) has occurred respecting any Canadian Plan which
would entitle any Person (without the consent of the Loan Party) to wind-up or
terminate any Canadian Plan in whole or in part, or which could, reasonably be
expected to adversely affect the tax status thereof; (E) a going concern
unfunded actuarial liability, past service unfunded liability or solvency
deficiency respecting any Canadian Plan that is registered pension plan is
disclosed by any actuarial valuation for such Canadian Plan whether or not such
valuation is filed with a Governmental Authority; (F) there has been a
withdrawal, or transfer of assets, from the Canadian Plans, other than benefit
payments or payment of permitted expenses or other legally valid withdrawals,
payments or transfers made in accordance the applicable laws the Loan Parties
shall provide to the Agents a certificate of an Authorized Officer of the Loan
Parties setting forth the details of such event and the action which is proposed
to be taken with respect thereto, together with any notice or filing which may
be required with respect to such event;
(xii) promptly after the commencement thereof but
in any event not later than 5 days after service of process with respect thereto
on, or the obtaining of knowledge thereof by, any Loan Party, notice of each
action, suit or proceeding before any court
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or other Governmental Authority or other regulatory body or any arbitrator which
is reasonably be expected to have a Material Adverse Effect;
(xiii) as soon as possible and in any event within
5 days after execution, receipt or delivery thereof, copies of any material
notices that any Loan Party executes or receives in connection with any Material
Contract (including, without limitation, the Indenture and any document related
to the Canadian Facility) and notice and copies of any amendments or
modifications to any Material Contract and the Canadian Facility;
(xiv) as soon as possible and in any event within
5 days after execution, receipt or delivery thereof, copies of any material
notices that any Loan Party executes or receives in connection with the sale or
other Disposition of the Capital Stock of, or all or substantially all of the
assets of, any Loan Party;
(xv) promptly after the sending or filing
thereof, copies of all statements, reports and other information any Loan Party
sends to any holders of its Indebtedness for borrowed money or its securities or
files with the SEC or any national (domestic or foreign) securities exchange;
(xvi) promptly upon receipt thereof, copies of all
financial reports (including, without limitation, management letters), if any,
submitted to any Loan Party by its auditors in connection with any annual or
interim audit of the books thereof;
(xvii) at the earlier of (x) the delivery of the
financial statements required to be delivered pursuant to Section 7.01(a)(i)
after the end of each fiscal quarter of the Parent and (y) the date upon which
the Net Book Value of Rolling Stock of the Designated Loan Parties purchased,
acquired or otherwise obtained during the period since the latest delivery
pursuant to this clause (xvii) exceeds $250,000, the originals of all
certificates of title or ownership for such Rolling Stock, and duly executed and
completed title or ownership applications with appropriate state agencies to
enable such Rolling Stock to be retitled with the Collateral Agent listed as a
lienholder thereof and an updated Schedule 5.01(xxx), which Schedule shall
include for all Rolling Stock of the Designated Loan Parties information with
respect to the manufacturer, the year made, the model, the vehicle
identification number, the state in which it is licensed, the license number,
the owner, state in which it is titled and the certificate of title or ownership
identification number; and
(xviii) promptly upon request, such other
information concerning the condition or operations, financial or otherwise, of
any Loan Party as any Agent may from time to time may reasonably request.
(b) Additional Guaranties and Collateral Security. Cause:
(i) each Loan Party's Subsidiary that is a
Designated Loan Party not in existence on the Effective Date or each Loan
Party's Subsidiary that becomes a Designated Loan Party, to execute and deliver
to the Collateral Agent promptly and in any event within 3 days after the
formation, acquisition or change in status thereof (A) a Guaranty guaranteeing
the Obligations, (B) a Security Agreement, (C) if such Subsidiary has any
Subsidiaries, a Pledge Agreement together with (x) certificates evidencing all
of the Capital Stock
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of any Person owned by such Subsidiary, (y) undated stock powers executed in
blank with signature guaranteed, and (z) such opinion of counsel and such
approving certificate of such Subsidiary as the Collateral Agent may reasonably
request in respect of complying with any legend on any such certificate or any
other matter relating to such shares, (D) one or more Mortgages creating on the
real property of such Subsidiary a perfected, first priority Lien on such real
property, a Title Insurance Policy covering such real property, a current ALTA
survey thereof and a surveyor's certificate (to the extent otherwise available),
each in form and substance satisfactory to the Collateral Agent, together with
such other agreements, instruments and documents as the Collateral Agent may
require whether comparable to the documents required under Section 7.01(n) or
otherwise, (E) any Canadian Security Documents, if applicable, and (F) such
other agreements, instruments, approvals, legal opinions or other documents
reasonably requested by the Collateral Agent in order to create, perfect,
establish the first priority of or otherwise protect any Lien purported to be
covered by any such Security Agreement, Pledge Agreement, Mortgage or Canadian
Security Document or otherwise to effect the intent that such Subsidiary shall
become bound by all of the terms, covenants and agreements contained in the Loan
Documents and that all property and assets of such Subsidiary shall become
Collateral for the Obligations; provided, however, that to the extent any such
Subsidiary is organized or formed under the laws of a jurisdiction other than
the United States of America or Canada, the Parent shall not be required to
deliver the foregoing documents if the Parent provides written certification
stating that if such Subsidiary were to become a Designated Loan Party, it would
be materially disadvantageous to the Loan Parties from a tax perspective;
(ii) each owner of the Capital Stock of any such
Subsidiary to execute and deliver promptly and in any event within 3 Business
Days after the formation or acquisition of such Subsidiary a Pledge Agreement,
as applicable, together with (A) certificates evidencing all of the Capital
Stock of such Subsidiary, (B) undated stock powers or other appropriate
instruments of assignment executed in blank with signature guaranteed, (C) such
opinion of counsel and such approving certificate of such Subsidiary as the
Collateral Agent may reasonably request in respect of complying with any legend
on any such certificate or any other matter relating to such shares and (D) such
other agreements, instruments, approvals, legal opinions or other documents
requested by the Collateral Agent; provided, however, that to the extent any
such Subsidiary is organized or formed under the laws of a jurisdiction other
than the United States of America or Canada and the Borrowers provide written
certification stating that a pledge of 100% of the Capital Stock of such
Subsidiary would be materially disadvantageous to the Loan Parties from a tax
perspective, a pledge of the Capital Stock of such Subsidiary will be limited to
sixty-six percent (66%) of the Capital Stock of such Subsidiary; and
(iii) each "Guarantor" (as such term is defined in
the Indenture) to become a Guarantor hereunder and execute and deliver such
agreements, documents and other instrument as required at such time it becomes a
"Guarantor" under the Indenture.
(c) Compliance with Laws, Etc. Comply, and cause each of
its Subsidiaries to comply, in all material respects, with all applicable laws,
rules, regulations and orders (including, without limitation, all Environmental
Laws and Motor Vehicle Laws), such compliance to include, without limitation,
(i) paying before the same become delinquent all taxes, assessments and
governmental charges or levies imposed upon it or upon its income or profits or
upon any of its properties, and (ii) paying all lawful claims which if unpaid
might
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become a Lien or charge upon any of its properties, except to the extent
contested in good faith by proper proceedings which stay the imposition of any
penalty, fine or Lien resulting from the non-payment thereof and with respect to
which adequate reserves have been set aside for the payment thereof in
accordance with GAAP.
(d) Preservation of Existence, Etc. Subject to Section
7.02(c), maintain and preserve, and cause each of its Subsidiaries that is a
Designated Loan Party to maintain and preserve, its existence, rights and
privileges, and become or remain, and cause each of its Subsidiaries that is a
Designated Loan Party to become or remain, duly qualified and in good standing
in each jurisdiction in which the character of the properties owned or leased by
it or in which the transaction of its business makes such qualification
necessary and where the failure to be so qualified and in good standing is
reasonably expected to have a Material Adverse Effect.
(e) Keeping of Records and Books of Account. Keep, and
cause each of its Subsidiaries that is a Designated Loan Party to keep, adequate
records and books of account, with complete entries made to permit the
preparation of financial statements in accordance with GAAP.
(f) Inspection Rights.
(i) Permit, and cause each of its Subsidiaries
to permit, the agents and representatives of any Agent at any time and from time
to time during normal business hours, at the expense of the Borrowers, to
examine and make copies of and abstracts from its records and books of account,
to visit and inspect its properties, to verify materials, leases, notes,
accounts receivable, deposit accounts and its other assets, to conduct audits,
physical counts, valuations, appraisals, Phase I and Phase II Environmental Site
Assessments or examinations and to discuss its affairs, finances and accounts
with any of its directors, officers, managerial employees, independent
accountants or any of its other representatives. The Borrowers agree to pay the
reasonable cost of such audits, appraisals, assessments or examinations.
(ii) Permit and assist the Agents to conduct, not
less frequently than two times each calendar year, an appraisal of the Rolling
Stock of the Designated Loan Parties, which appraisal shall be conducted by a
qualified independent third party satisfactory to the Agents in order to
determine the Orderly Liquidation Values of such Rolling Stock which value will
be used in calculating the Borrowing Base on the date such appraisal is issued
and received by the Agents until such time as a subsequent appraisal is
conducted, issued and received by the Agents pursuant to this Section
7.01(f)(ii).
(g) Maintenance of Properties, Etc. Maintain and
preserve, and cause each of its Subsidiaries that is a Designated Loan Party to
maintain and preserve, all of its properties which are necessary in the proper
conduct of its business in good working order and condition, ordinary wear and
tear excepted, and comply, and cause each of its Subsidiaries that is a
Designated Loan Party to comply, at all times with the provisions of all leases
to which it is a party as lessee or under which it occupies property, so as to
prevent any loss or forfeiture thereof
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or thereunder, unless the Designated Loan Party would be able to replace such
lease without material cost or disruption to its business.
(h) Maintenance of Insurance. Maintain, and cause each of
its Subsidiaries to maintain, insurance with responsible and reputable insurance
companies or associations (including, without limitation, comprehensive general
liability, hazard, rent and business interruption insurance) with respect to its
properties (including all real properties leased or owned by it) and business,
in such amounts and covering such risks as is required by any Governmental
Authority having jurisdiction with respect thereto or as is carried generally in
accordance with sound business practice by companies in similar businesses
similarly situated and in any event in amount, adequacy and scope reasonably
satisfactory to the Collateral Agent. All property or casualty policies covering
the Collateral are to be made payable to the Collateral Agent for the benefit of
the Lenders, as its interests may appear, in case of loss, under a standard
non-contributory "lender" or "secured party" clause and are to contain such
other provisions as the Collateral Agent may require to fully protect the
Lenders' interest in the Collateral and to any payments to be made under such
policies. All certificates of insurance are to be delivered to the Collateral
Agent and the policies are to be premium prepaid for a period of one month
(which premium may be financed to the extent permitted by the terms of this
Agreement) with the loss payable and additional insured endorsement in favor of
the Collateral Agent and such other Persons as the Collateral Agent may
designate from time to time, and shall provide for not less than 30 days' prior
written notice to the Collateral Agent of the exercise of any right of
cancellation. If any Loan Party or any of its Subsidiaries fails to maintain
such insurance, the Collateral Agent may arrange for such insurance, but at the
Borrowers' expense and without any responsibility on the Collateral Agent's part
for obtaining the insurance, the solvency of the insurance companies, the
adequacy of the coverage, or the collection of claims. Upon the occurrence and
during the continuance of an Event of Default, the Collateral Agent shall have
the sole right, in the name of the Lenders, any Loan Party and its Subsidiaries,
to file claims under any insurance policies, to receive, receipt and give
acquittance for any payments that may be payable thereunder, and to execute any
and all endorsements, receipts, releases, assignments, reassignments or other
documents that may be necessary to effect the collection, compromise or
settlement of any claims under any such insurance policies.
(i) Obtaining of Permits, Etc. (i) Obtain, maintain and
preserve, and cause each of its Subsidiaries that is a Designated Loan Party to
obtain, maintain and preserve, and take all necessary action to timely renew,
all permits, licenses, authorizations, approvals, entitlements and
accreditations which are necessary or useful in the proper conduct of its
business and which if not obtained, maintained or preserved is reasonably likely
to have a Material Adverse Effect.
(ii) Cause all Rolling Stock, now owned or
hereafter acquired by any Designated Loan Party, which, under applicable law, is
required to be registered, to be properly registered (including, without
limitation, the payment of all necessary taxes and receipt of any applicable
permits) in the name of such Designated Loan Party and cause all Rolling Stock,
now owned or hereafter acquired by any Designated Loan Party, the ownership of
which, under applicable law (including, without limitation, any Motor Vehicle
Law), is evidenced by a certificate of title or ownership, to be properly titled
in the name of such Designated Loan Party, with the Collateral Agent's Lien
noted thereon.
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(j) Environmental. (i) Keep any property either owned or
operated by it or any of its Subsidiaries free of any Environmental Liens; (ii)
comply, and cause each of its Subsidiaries to comply, in all material respects
with Environmental Laws and provide to the Collateral Agent any documentation of
such compliance which the Collateral Agent may reasonably request; (iii) within
five (5) Business Days after becoming aware thereof, notify the Agents of any
Release of a Hazardous Material in excess of any reportable quantity from or
onto property at any time owned or operated by it or any of its Subsidiaries and
take any Remedial Actions required to abate said Release; (iv) provide the
Agents with written notice within 10 days of the receipt of any of the
following: (A) notice that an Environmental Lien has been filed against any
property of any Loan Party or any of its Subsidiaries; (B) commencement of any
Environmental Action or written notice that an Environmental Action will be
filed against any Loan Party or any of its Subsidiaries; and (C) notice of a
violation, citation or other administrative order which is reasonably likely to
have a Material Adverse Effect and (v) defend, indemnify and hold harmless each
Agent, each Lender and the L/C Issuer and all of their respective officers,
directors, employees, attorneys, consultants and agents (each, an "Indemnitee"),
from and against any claims, demands, penalties, fines, liabilities,
settlements, damages, costs or expenses (including, without limitation,
reasonable attorneys' and consultants' fees, investigation and laboratory fees,
court costs and litigation expenses) arising out of (1) the generation,
presence, disposal, Release or threatened Release of any Hazardous Materials on,
in, under, originating from or emanating from any property at any time owned or
operated by any Loan Party or any of its Subsidiaries (or its predecessors in
interest or title), (2) any personal injury (including wrongful death) or
property damage (real or personal) arising out of or related to the presence or
Release of such Hazardous Material on, in, under originating from or emanating
from any property at any time owned or operated by any Loan Party or any of its
Subsidiaries (or its predecessors in interest or title), (3) any investigation,
lawsuit brought or threatened, settlement reached or government order relating
to the presence or Release of such Hazardous Materials on, in, under,
originating from or emanating from any property owned or operated at any time by
any Loan Party or any of its Subsidiaries (or its predecessors in interest or
title), (4) any violation of any Environmental Law by any Loan Party or any of
its Subsidiaries (or its predecessors in interest or title), and/or (5) any
Environmental Action filed against any Agent or any Lender in connection with
the Loan Parties or any of its Subsidiaries (or its predecessors in interest or
title); provided, that the Loan Parties shall not be obligated to indemnify or
hold harmless any Indemnitee to the extent that any such claims, demands,
penalties, fines, liabilities, settlements, damages, costs or expenses arise out
of the gross negligence or willful misconduct of such Indemnitee.
(k) Further Assurances. Take such action and execute,
acknowledge and deliver, and cause each of its Subsidiaries to take such action
and execute, acknowledge and deliver, at its sole cost and expense, such
agreements, instruments or other documents as any Agent may reasonably require
from time to time in order (i) to carry out more effectively the purposes of
this Agreement and the other Loan Documents, (ii) to subject to valid and
perfected first priority Liens any of the Collateral or any other property of
any Loan Party and its Subsidiaries, (iii) to establish and maintain the
validity and effectiveness of any of the Loan Documents and the validity,
perfection and priority of the Liens intended to be created thereby, and (iv) to
better assure, convey, grant, assign, transfer and confirm unto each Agent, each
Lender and the L/C Issuer the rights now or hereafter intended to be granted to
it under this Agreement or any other Loan Document. In furtherance of the
foregoing, to the maximum
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extent permitted by applicable law, each Loan Party (A) authorizes each Agent
during the continuance of an Event of Default to execute any such agreements,
instruments or other documents in such Loan Party's name and to file such
agreements, instruments or other documents in any appropriate filing office, (B)
authorizes each Agent to file any financing statement required hereunder or
under any other Loan Document, and any continuation statement or amendment with
respect thereto, in any appropriate filing office without the signature of such
Loan Party, and (C) ratifies the filing of any financing statement, and any
continuation statement or amendment with respect thereto, filed without the
signature of such Loan Party prior to the date hereof.
(l) Change in Collateral Location; Collateral Records.
(i) Give the Collateral Agent not less than 30 days' prior written notice of (x)
any change in the location of any Collateral (or, in the case of the Rolling
Stock, any change in the location where such Rolling Stock is based), other than
to locations set forth on Schedule 7.01(l) and with respect to which the
Collateral Agent has filed financing statements and otherwise fully perfected
its Liens thereon and (y) any anticipated or actual relocations of Rolling Stock
of the Designated Loan Parties from the United States into Canada for a period
of more than 30 days, (ii) advise the Collateral Agent promptly, in sufficient
detail, of any material adverse change relating to the type, quantity or quality
of the Collateral or the Lien granted thereon and (iii) execute and deliver, and
cause each of its Subsidiaries that is a Designated Loan Party to execute and
deliver, to the Collateral Agent for the benefit of the Lenders from time to
time, solely for the Collateral Agent's convenience in maintaining a record of
Collateral, such written statements and schedules as the Collateral Agent may
reasonably require, designating, identifying or describing the Collateral.
(m) Landlord Waivers; Collateral Access Agreements. Use
commercially reasonable efforts to obtain at the time it enters into a lease for
real property not occupied on the Effective Date or delivers possession of
Collateral to Persons that did not have possession of Collateral on the
Effective Date, a landlord's waiver from the landlord of such real property
(which waiver may be contained in such lease) or a collateral access agreement
from the Person that has possession of such Collateral, in form and substance
reasonably satisfactory to the Collateral Agent.
(n) Fiscal Year. Cause the Fiscal Year of the Parent and
its Subsidiaries to end on December 31 of each calendar year unless the Agents
consent to a change in such Fiscal Year (and appropriate related changes to this
Agreement).
(o) After Acquired Real Property. Upon the acquisition by
it or any of its Subsidiaries after the date hereof of any fee interest in any
real property (wherever located) (each such interest being an "After Acquired
Property") with a Current Value (as defined below) in excess of $500,000,
immediately so notify the Collateral Agent, setting forth with specificity a
description of the interest acquired, the location of the real property, any
structures or improvements thereon and either an appraisal or such Loan Party's
good-faith estimate of the current value of such real property (for purposes of
this Section, the "Current Value"). The Collateral Agent shall notify such Loan
Party whether it intends to require a Mortgage and the other documents referred
to below. Upon receipt of such notice requesting a Mortgage, the Person which
has acquired such After Acquired Property shall furnish within ten (10) days to
the
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Collateral Agent the following, each in form and substance satisfactory to the
Collateral Agent: (i) a Mortgage with respect to such real property and related
assets located at the After Acquired Property, each duly executed by such Person
and in recordable form; (ii) evidence of the recording of the Mortgage referred
to in clause (i) above in such office or offices as may be necessary or, in the
opinion of the Collateral Agent, desirable to create and perfect a valid and
enforceable first priority lien on the property purported to be covered thereby
or to otherwise protect the rights of the Agents and the Lenders thereunder,
(iii) a Title Insurance Policy, (iv) to the extent otherwise available, a survey
of such real property, certified to the issuer of the Title Insurance Policy by
a licensed professional surveyor reasonably satisfactory to the Collateral
Agent, (v) Phase I Environmental Site Assessments with respect to such real
property, certified to the Collateral Agent by a company reasonably satisfactory
to the Collateral Agent, and (vi) such other documents or instruments (including
guarantees and opinions of counsel) as the Collateral Agent may reasonably
require. The Borrowers shall pay all fees expenses, including reasonable
attorneys' fees and expenses, all title insurance charges and premiums and all
mortgage recording taxes, in connection with each Loan Party's obligations under
this Section 7.01(n).
(p) Borrowing Base. Maintain all Revolving Loans and
Letter of Credit Obligations in compliance with the then current Borrowing Base.
(q) Electronic Collateral Reporting System. Within 120
days after the Effective Date, cause to be established, a electronic collateral
reporting system satisfactory in all respects to the Administrative Agent.
Section 7.02 Negative Covenants. So long as any principal of or
interest on any Senior Loan, Reimbursement Obligation, Letter of Credit
Obligation or any other Senior Obligation (whether or not due) shall remain
unpaid or any Senior Lender shall have any Senior Commitment hereunder, the
Parent shall not, and shall cause its Subsidiaries or the Designated Loan
Parties, as applicable, not to, unless the Required Lenders shall otherwise
consent in writing:
(a) Liens, Etc. Create, incur, assume or suffer to exist,
or permit any of its Subsidiaries to create, incur, assume or suffer to exist,
any Lien upon or with respect to any of its properties, whether now owned or
hereafter acquired, to file or suffer to exist under the Uniform Commercial Code
or any similar law or statute of any jurisdiction, a financing statement (or the
equivalent thereof) that names it or any of its Subsidiaries as debtor (other
than financing statements in favor of the Existing Lenders that will be
terminated on or about the Effective Date and for which the Collateral Agent has
received either termination statements required to be delivered pursuant to
Section 5.01(d)(xxiv)) or been authorized in writing to file termination
statements, to sign or suffer to exist any security agreement authorizing any
secured party thereunder to file such financing statement (or the equivalent
thereof), to sell any of its property or assets subject to an understanding or
agreement, contingent or otherwise, to repurchase such property or assets
(including sales of accounts receivable) with recourse to it or any of its
Subsidiaries (other than customary indemnification obligations with respect to
sales of such property or assets) or assign or otherwise transfer, or permit any
of its Subsidiaries to assign or otherwise transfer, any account or other right
to receive income, other than, as to all of the above, Permitted Liens;
provided, that, no Liens shall be permitted on any assets included in the
Borrowing Base other than the Liens of the Collateral Agent for the benefit of
the Lenders.
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(b) Indebtedness. Create, incur, assume, guarantee or
suffer to exist, or otherwise become or remain liable with respect to, or permit
any of its Subsidiaries to create, incur, assume, guarantee or suffer to exist
or otherwise become or remain liable with respect to, any Indebtedness other
than Permitted Indebtedness. Notwithstanding the foregoing, Allied Canada shall
not enter into the Canadian Facility unless the terms and conditions of such
facility are acceptable to the Agents.
(c) Fundamental Changes; Dispositions. Wind-up, liquidate
or dissolve, or merge, consolidate or amalgamate with any Person, or convey,
sell, lease or sublease, transfer or otherwise dispose of, whether in one
transaction or a series of related transactions, all or any part of its
business, property or assets, whether now owned or hereafter acquired (or agree
to do any of the foregoing), or purchase or otherwise acquire, whether in one
transaction or a series of related transactions, all or substantially all of the
assets of any Person (or any division thereof) (or agree to do any of the
foregoing), or permit any of its Subsidiaries that is a Designated Loan Party to
do any of the foregoing; provided, however, that
(i) (A) any Subsidiary of the Parent that is not
a Loan Party may be merged, consolidated or dissolved into, or may transfer its
assets to, any other Subsidiary of the Parent that is not a Loan Party, so long
as (1) no other provision of this Agreement would be violated thereby and (2)
the Parent gives the Agents written notice promptly after the consummation of
such transaction; (B) (x) any Loan Party (other than a Designated Loan Party)
may be merged, consolidated or dissolved into, or may transfer its assets to,
any other Loan Party (other than a Designated Loan Party) and (y) any Designated
Loan Party (other than the Borrowers) may be merged, consolidated or dissolved
into, or may transfer its assets to, any other Designated Loan Party (other than
the Borrowers), in each case, so long as (1) no other provision of this
Agreement would be violated thereby, (2) such Loan Party gives the Agents at
least 30 days' prior written notice of such transaction, (3) no Default or Event
of Default shall have occurred and be continuing either before or after giving
effect to such transaction, and (4) the Senior Lenders' rights in any
Collateral, including, without limitation, the existence, perfection and
priority of any Lien thereon, are not adversely affected by such transaction,
and; and (C) any Subsidiary of the Parent may be merged, consolidated or
dissolved into, or may transfer its assets to, any Loan Party, provided that (1)
a Loan Party is the surviving entity, (2) in the case of a merger, consolidation
or dissolution of, or transfer of assets by, a Subsidiary that is not a Loan
Party into a Loan Party, no Default or Event of Default shall have occurred and
be continuing or would result therefrom, and (3) in the case of a merger,
consolidation or dissolution of, or transfer of assets by, a Subsidiary that is
not a Designated Loan Party into a Designated Loan Party or by a Designated Loan
Party into a Loan Party that is not a Designated Loan Party, the surviving
entity will no longer be a Designated Loan Party for purposes of the definition
of the terms "Borrowing Base", Eligible Accounts Receivable" and "Eligible
Rolling Stock";
(ii) any Loan Party and its Subsidiaries may (A)
sell Inventory in the ordinary course of business, (B) dispose of obsolete or
worn-out equipment (other than Rolling Stock) in the ordinary course of
business, (C) sell or otherwise dispose of other property or assets (other than
any Accounts Receivable, Capital Stock, Rolling Stock or Facility of any Loan
Party) for cash in an amount not less than the fair market value of such
property or assets, (D) sell or otherwise dispose of Rolling Stock for cash in
an amount not less than the fair market
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value of such Rolling Stock, (E) sell or otherwise dispose of the surplus
Facilities set forth in Schedule 7.02(c)(ii) for cash for an amount for each
such Facility of not less than the fair market value of such Facility and (F)
sell or otherwise dispose of (including subleases of excess office space)
surplus Facilities not set forth in Schedule 7.02(c)(ii); provided that (x) the
Net Cash Proceeds of such Dispositions (1) in the case of clauses (B) and (C)
above, do not exceed $1,500,000 in the aggregate in any twelve-month period, (2)
in the case of clause (D) above, do not exceed $1,500,000 in the aggregate in
any twelve-month period, and (3) in the case of clause (F) above (excluding any
transaction that is a sublease of excess office space), do not exceed $1,500,000
in the aggregate in any twelve-month period, (y) in the case of clauses (C),
(D), (E) and (F), so long as, before and after giving effect to the transactions
permitted thereby, there exists no continuing Event of Default and (z) in all
cases, are paid to the Administrative Agent for the benefit of the Lenders
pursuant to the terms of Section 2.05(c)(v) and applied pursuant to Section
2.05(d); and
(iii) the Parent may in one or a series of
transactions sell, transfer or otherwise dispose of all of the Capital Stock of
any Axis Entity or all or substantially all of the assets of any Axis Entity so
long as (A) no Default or Event of Default shall have occurred and be continuing
either before or after giving effect to any such transaction, (B) no other
provisions of this Agreement would be violated thereby, (C) the Administrative
Borrower gives the Agents at least twenty (20) days' prior written notice of
such sale, transfer or other disposition, except in connection with the sale of
the Capital Stock of Axis Netherlands, C.V., in which case such notice shall be
three (3) Business Days, (D) the Net Cash Proceeds of such sale, transfer or
other disposition are applied in accordance with Section 2.05(d), and (E) to the
extent the properties or assets (including, the Capital Stock) of the Axis
Entities related to their North America operations are sold, transferred or
otherwise disposed, the Net Cash Proceeds received by the Parent or any of its
Subsidiaries are not be less than $5,000,000.
(d) Change in Nature of Business. Make, or permit any of
its Subsidiaries or Haul Insurance to make, any change in the nature of its
business as described in Section 6.01(l) carried on at the date hereof.
(e) Loans, Advances, Investments, Etc. Make or commit or
agree to make any loan, advance guarantee of obligations, other extension of
credit or capital contributions to, or hold or invest in or commit or agree to
hold or invest in, or purchase or otherwise acquire or commit or agree to
purchase or otherwise acquire any shares of the Capital Stock, bonds, notes,
debentures or other securities of, or make or commit or agree to make any other
investment in, any other Person, or purchase or own any futures contract or
otherwise become liable for the purchase or sale of currency or other
commodities at a future date in the nature of a futures contract, or permit any
of its Subsidiaries that are Designated Loan Parties to do any of the foregoing,
except for: (i) investments existing on the date hereof, as set forth on
Schedule 7.02(e) hereto, but not any increase in the amount thereof as set forth
in such Schedule or any other modification of the terms thereof or investments
by the Parent in Haul Insurance unless otherwise permitted under clause (iii)
below, (ii) loans, advances and equity contributions by any Loan Party to any
other Loan Party, provided that (A) in the case of loans and advances, such
loans and advances are evidenced by an intercompany note that is pledged to the
Collateral Agent pursuant to the terms of the Pledge Agreement and (B) in the
case of any loan, advance or equity contribution to any Subsidiary that is not a
Loan Party, if such loan, advance or equity
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contribution is not made in the ordinary course of business consistent with past
practice to pay working capital expenses then due and payable, the Borrowers
shall prepay the Senior Loans in an amount equal to such loan, advance or equity
contribution made to the Subsidiary that is not a Loan Party, such prepayment to
be made in accordance with the provisions of Section 4.04(b) of this Agreement,
assuming for purposes of such prepayment that an Event of Default had occurred
and was continuing, and the Total Revolving Credit Commitment shall be
permanently reduced by an amount equal to such loan, advance, or equity
contribution made to the Subsidiary that is not a Loan Party, (iii) investments
by the Parent in Haul Insurance in a maximum aggregate amount not to exceed the
amount of capital required to be maintained by Haul Insurance under the laws of
the Cayman Islands, provided, that such investments shall be limited to the
amount of capital required which arises from the insurance risks associated with
the Parent and its Subsidiaries (and not insurance risks relating to third
parties), and (iv) Permitted Investments.
(f) Lease Obligations. Create, incur or suffer to exist,
or permit any of its Subsidiaries that are Designated Loan Parties to create,
incur or suffer to exist, any obligations as lessee (i) for the payment of rent
for any real or personal property in connection with any sale and leaseback
transaction, or (ii) for the payment of rent for any real or personal property
under leases or agreements to lease other than (A) Capitalized Lease Obligations
which would not cause the aggregate amount of all obligations under Capitalized
Leases entered into after the Effective Date owing by all Loan Parties and their
Subsidiaries in any Fiscal Year to exceed the amounts set forth in subsection
(g) of this Section 7.02 and (B) Operating Lease Obligations which would not
cause the aggregate amount of all Operating Lease Obligations owing by all Loan
Parties and their Subsidiaries in any Fiscal Year to exceed $20,000,000.
(g) Capital Expenditures. Make or commit or agree to
make, or permit any of its Subsidiaries to make or commit or agree to make, any
Capital Expenditure (by purchase or Capitalized Lease) that would cause the
aggregate amount of all Capital Expenditures made by the Loan Parties and their
Subsidiaries to exceed $31,200,000 for Fiscal Year 2002, $37,500,000 for Fiscal
Year 2003, $54,000,000 for Fiscal Year 2004 and $9,000,000 for the first two
months of Fiscal Year 2005.
(h) Restricted Payments. (i) Declare or pay any dividend
or other distribution, direct or indirect, on account of any Capital Stock of
any Loan Party or any of its Subsidiaries, now or hereafter outstanding, (ii)
make any repurchase, redemption, retirement, defeasance, sinking fund or similar
payment, purchase or other acquisition for value, direct or indirect, of any
Capital Stock of any Loan Party or any direct or indirect parent of any Loan
Party, now or hereafter outstanding, (iii) make any payment to retire, or to
obtain the surrender of, any outstanding warrants, options or other rights for
the purchase or acquisition of shares of any class of Capital Stock of any Loan
Party, now or hereafter outstanding, (iv) return any Capital Stock to any
shareholders or other equity holders of any Loan Party or any of its
Subsidiaries, or make any other distribution of property, assets, shares of
Capital Stock, warrants, rights, options, obligations or securities thereto as
such or (v) pay any management fees or any other fees or expenses (including the
reimbursement thereof by any Loan Party or any of its Subsidiaries) pursuant to
any management, consulting or other services agreement to any of the
shareholders or other equityholders of any Loan Party or any of its Subsidiaries
or other Affiliates, or to any other Subsidiaries or Affiliates of any Loan
Party; provided, that (x) a
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Subsidiary of the Parent may pay dividends and other distributions to the Parent
or to another Subsidiary of the Parent that is the owner of the Capital Stock of
the Subsidiary paying such dividend or other distribution, provided, further,
that, if the payment of a dividend or distribution to a Subsidiary that is not a
Designated Loan Party would result in a Default or an Event of Default or is
made at a time when a Default or Event of Default has otherwise occurred and is
continuing, the Borrowers shall prepay the Senior Loans in an amount equal to
such dividend or other distribution made to the Subsidiary that is not a
Designated Loan Party, such prepayment to be made in accordance with the
provisions of Section 4.04(b) of this Agreement, and the Total Revolving Credit
Commitment shall be permanently reduced by an amount equal to such dividend or
other distribution made to the Subsidiary that is not a Designated Loan Party,
(y) the Parent may pay dividends in the form of common Capital Stock and (z) the
Parent or any of its Subsidiaries may, in the ordinary course of business
consistent with past practice, charge management fees or expenses then due and
payable to any of its other Subsidiaries for the payment of services rendered by
the Parent or such Subsidiary to such other Subsidiary of the Parent.
(i) Federal Reserve Regulations. Permit any Loan or the
proceeds of any Loan under this Agreement to be used for any purpose that would
cause such Loan to be a margin loan under the provisions of Regulation T, U or X
of the Board.
(j) Transactions with Affiliates. Enter into, renew,
extend or be a party to, or permit any of its Subsidiaries to enter into, renew,
extend or be a party to, any transaction or series of related transactions
(including, without limitation, the purchase, sale, lease, transfer or exchange
of property or assets of any kind or the rendering of services of any kind) with
any Affiliate, except (i) in the ordinary course of business in a manner and to
an extent consistent with past practice and necessary or desirable for the
prudent operation of its business, for fair consideration and on terms no less
favorable to it or its Subsidiaries than would be obtainable in a comparable
arm's length transaction with a Person that is not an Affiliate thereof, (ii)
transactions with another Loan Party and (iii) transactions permitted by Section
7.02(e).
(k) Limitations on Dividends and Other Payment
Restrictions Affecting Subsidiaries. Create or otherwise cause, incur, assume,
suffer or permit to exist or become effective any consensual encumbrance or
restriction of any kind on the ability of any Subsidiary of any Loan Party (i)
to pay dividends or to make any other distribution on any shares of Capital
Stock of such Subsidiary owned by any Loan Party or any of its Subsidiaries,
(ii) to pay or prepay or to subordinate any Indebtedness owed to any Loan Party
or any of its Subsidiaries, (iii) to make loans or advances to any Loan Party or
any of its Subsidiaries or (iv) to transfer any of its property or assets to any
Loan Party or any of its Subsidiaries, or permit any of its Subsidiaries to do
any of the foregoing; provided, however, that nothing in any of clauses (i)
through (iv) of this Section 7.02(k) shall prohibit or restrict:
(A) this Agreement and the other Loan Documents;
(B) any agreements in effect on the date of this
Agreement and described on Schedule 7.02(k);
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(C) any applicable law, rule or regulation
(including, without limitation, applicable currency control laws and applicable
state corporate statutes restricting the payment of dividends in certain
circumstances);
(D) in the case of clause (iv), any agreement
setting forth customary restrictions on the subletting, assignment or transfer
of any property or asset that is a lease, license, conveyance or contract of
similar property or assets;
(E) in the case of clause (iv), any agreement,
instrument or other document evidencing a Permitted Lien from restricting on
customary terms the transfer of any property or assets subject thereto;
(F) in the case of clause (i), in the absence of
an Event of Default, the limitation contained in this Section shall not apply to
any Subsidiary of the Parent to the extent such limits are not permitted by the
terms of the Indenture; or
(G) in the case of clause (iv), customary
restrictions in asset or stock sale agreements limiting transfer of such assets
or stock pending the closing of such sale.
(l) Limitation on Issuance of Capital Stock. Issue or
sell or enter into any agreement or arrangement for the issuance and sale of, or
permit any of its Subsidiaries to issue or sell or enter into any agreement or
arrangement for the issuance and sale of, any shares of its Capital Stock, any
securities convertible into or exchangeable for its Capital Stock or any
warrants; provided that the Parent may issue shares of its common stock.
(m) Modifications of Indebtedness, Organizational
Documents and Certain Other Agreements; Etc. (i) Amend, modify or otherwise
change (or permit the amendment, modification or other change in any manner of)
any of the provisions of any of its or its Subsidiaries' Indebtedness for
borrowed money or of any instrument or agreement (including, without limitation,
any purchase agreement, indenture, loan agreement or security agreement)
relating to any such Indebtedness for borrowed money if such amendment,
modification or change would shorten the final maturity or average life to
maturity of, or require any payment to be made earlier than the Final Senior
Loan Maturity Date on, such Indebtedness, would increase the interest rate
applicable to such Indebtedness, would change the subordination provision, if
any, of such Indebtedness, or would otherwise be adverse to the Agents, the
Senior Lenders or the issuer of such Indebtedness in any respect, (ii) except
for the Senior Obligations and intercompany Indebtedness to the extent permitted
under Section 7.02(e)(ii), make any voluntary or optional payment, prepayment,
redemption, defeasance, sinking fund payment or other acquisition for value of
any of its or its Subsidiaries' Indebtedness for borrowed money (including,
without limitation, by way of depositing money or securities with the trustee
therefor before the date required for the purpose of paying any portion of such
Indebtedness when due), or refund, refinance, replace or exchange any other
Indebtedness for borrowed money for any such Indebtedness (except to the extent
such Indebtedness is otherwise expressly permitted by the definition of
"Permitted Indebtedness"), or make any payment, prepayment, redemption,
defeasance, sinking fund payment or repurchase of any outstanding Indebtedness
for borrowed money as a result of any asset sale, change of control, issuance
and sale of debt or equity
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securities or similar event, or give any notice with respect to any of the
foregoing prior to the payment in full of all Senior Obligations, or (iii)
except as permitted by Section 7.02(c), amend, modify or otherwise change its
name, jurisdiction of organization, organizational identification number or
FEIN, (iv) amend, modify or otherwise change its certificate of incorporation or
bylaws (or other similar organizational documents), including, without
limitation, by the filing or modification of any certificate of designation, or
any agreement or arrangement entered into by it, with respect to any of its
Capital Stock (including any shareholders' agreement), or enter into any new
agreement with respect to any of its Capital Stock, except any such amendments,
modifications or changes or any such new agreements or arrangements pursuant to
this clause (iv) that either individually or in the aggregate, are not
reasonably likely to have a Material Adverse Effect, or (v) cause or permit (1)
any Indebtedness other than the Indebtedness under this Agreement to be
designated as "Permitted Debt" under clause (i) the second paragraph of Section
4.09 of the Indenture or (2) more than an amount equal to (A) $202,250,000 plus
all outstanding Capital Lease Obligations (as defined in the Indenture) incurred
under such clause (i) to exceed the greater of (x) $230,000,000 and (y) an
amount equal to the amount of Indebtedness permitted to be incurred under
subclause (i)(2) of the second paragraph of Section 4.09 of the Indenture.
(n) Investment Company Act of 1940. Engage in any
business, enter into any transaction, use any securities or take any other
action or permit any of its Subsidiaries to do any of the foregoing, that would
cause it or any of its Subsidiaries to become subject to the registration
requirements of the Investment Company Act of 1940, as amended, by virtue of
being an "investment company" or a company "controlled" by an "investment
company" not entitled to an exemption within the meaning of such Act.
(o) Compromise of Accounts Receivable. Compromise or
adjust any Account Receivable (or extend the time of payment thereof) or grant
any discounts, allowances or credits or permit any of its Subsidiaries that are
Designated Loan Parties to do so other than, provided no Event of Default has
occurred and is continuing, in the ordinary course of its business; provided,
however, in no event shall any such discount, allowance or credit exceed 2% of
the amount of such Account Receivable and no such extension of the time for
payment extend beyond 30 days from the original due date thereof.
(p) ERISA. (i) Engage, or permit any ERISA Affiliate to
engage, in any transaction described in Section 4069 of ERISA; (ii) engage, or
permit any ERISA Affiliate to engage, in any prohibited transaction described in
Section 406 of ERISA or 4975 of the Internal Revenue Code for which a statutory
or class exemption is not available or a private exemption has not previously
been obtained from the U.S. Department of Labor; (iii) adopt or permit any ERISA
Affiliate to adopt any employee welfare benefit plan within the meaning of
Section 3(1) of ERISA which provides benefits to employees after termination of
employment other than as required by Section 601 of ERISA or applicable law;
(iv) fail to make any contribution or payment to any Multiemployer Plan which it
or any ERISA Affiliate may be required to make under any agreement relating to
such Multiemployer Plan, or any law pertaining thereto; or (v) fail, or permit
any ERISA Affiliate to fail, to pay any required installment or any other
payment required under Section 412 of the Internal Revenue Code on or before the
due date for such installment or other payment.
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(q) Environmental. Permit the use, handling, generation,
storage, treatment, Release or disposal of Hazardous Materials at any property
owned or leased by it or any of its Subsidiaries, except in compliance with
Environmental Laws, except where the failure to so comply is not reasonably
expected to result in a Material Adverse Effect.
(r) Certain Agreements. Agree to any material amendment
or other material change to or material waiver of any of its rights under any
Material Contract.
Section 7.03 Financial Covenants. So long as any principal of or
interest on any Senior Loan, Reimbursement Obligation, Letter of Credit
Obligation or any other Senior Obligation (whether or not due) shall remain
unpaid or any Senior Lender shall have any Commitment hereunder, each Loan Party
shall not, unless the Required Lenders shall otherwise consent in writing:
(a) Leverage Ratio. Permit the ratio of (i) the
outstanding principal amount of all Senior Loans and Capitalized Lease
Obligations of the Parent and its Subsidiaries as of the last day of the month
set forth below to (ii) Consolidated EBITDA of the Parent and its Subsidiaries
for the twelve (12) consecutive months ending on the month set forth below to be
greater than the applicable ratio set forth below:
Month Leverage Ratio
----- --------------
February 2002 3.80:1.0
March 2002 2.75:1.0
April 2002 2.70:1.0
May 2002 2.50:1.0
June 2002 2.00:1.0
July 2002 2.00:1.0
August 2002 2.00:1.0
September 2002 1.85:1.0
October 2002 1.75:1.0
November 2002 1.75:1.0
December 2002 1.75:1.0
January 2003 1.75:1.0
February 2003 1.75:1.0
March 2003 1.50:1.0
April 2003 1.50:1.0
May 2003 1.50:1.0
June 2003 and for each month thereafter 1.25:1.0
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(b) Fixed Charge Coverage Ratio. Permit the Fixed Charge
Coverage Ratio of the Parent and its Subsidiaries for the twelve (12)
consecutive months ending on the month set forth below to be less than the ratio
set forth opposite such date:
Month Fixed Charge Coverage Ratio
----- ---------------------------
February 2002 0.47:1.0
March 2002 0.61:1.0
April 2002 0.70:1.0
May 2002 0.76:1.0
June 2002 0.81:1.0
July 2002 0.82:1.0
August 2002 0.86:1.0
September 2002 0.84:1.0
October 2002 0.85:1.0
November 2002 0.88:1.0
December 2002 0.88:1.0
January 2003 0.90:1.0
February 2003 0.93:1.0
March 2003 0.96:1.0
April 2003 0.98:1.0
May 2003 1.00:1.0
June 2003 0.97:1.0
July 2003 0.98:1.0
August 2003 0.98:1.0
September 2003 0.96:1.0
October 2003 0.97:1.0
November 2003 0.97:1.0
December 2003 and for each month thereafter 0.94:1.0
(c) Consolidated EBITDA. Permit Consolidated EBITDA of
the Parent and its Subsidiaries for the twelve (12) consecutive months ending on
the month set forth below to be less than the applicable amount set forth below:
Month Consolidated EBITDA
----- -------------------
February 2002 $30,600,000
March 2002 $39,500,000
April 2002 $42,225,000
May 2002 $45,400,000
June 2002 $49,265,000
July 2002 $50,760,000
August 2002 $53,870,000
September 2002 $54,270,000
October 2002 $56,150,000
November 2002 $58,330,000
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Month Consolidated EBITDA
----- -------------------
December 2002 $60,000,000
January 2003 $61,595,000
February 2003 $63,325,000
March 2003 $65,235,000
April 2003 $66,835,000
May 2003 $67,975,000
June 2003 $68,400,000
July 2003 $68,500,000
August 2003 $68,700,000
September 2003 $69,385,000
October 2003 $69,865,000
November 2003 and for each month thereafter $70,000,000
(d) Excess Cash. Accumulate or maintain cash in deposit
and/or securities bank accounts (in excess of checks outstanding against such
accounts, amounts necessary to meet minimum balance requirements and amounts in
the accounts set forth in Schedule 8.01), Cash Equivalents or Permitted
Investments in an aggregate amount in excess of (i) $3,000,000 with respect to
Loan Parties organized in the United States, (ii) the Dollar Equivalent of
$500,000 with respect to Loan Parties organized in Canada (excluding accounts in
which the Administrative Agent has dominion and control), and (iii) $1,500,000
with respect to any Subsidiaries of the Parent that are not Loan Parties, in
each case for a period of more than three (3) consecutive Business Days.
ARTICLE VIII
MANAGEMENT, COLLECTION AND STATUS OF
ACCOUNTS RECEIVABLE AND OTHER COLLATERAL
Section 8.01 Collection of Accounts Receivable; Management of
Collateral. (a)(i) On or prior to the Effective Date, the Loan Parties other
than the Canadian Loan Parties shall assist the Administrative Agent in (A)
establishing, and, during the term of this Agreement, maintaining one or more
lockboxes in the name of the Administrative Agent and identified on Schedule
8.01 hereto (collectively, the "Lockboxes") with the financial institutions set
forth on Schedule 8.01 hereto or such other financial institutions selected by
the Loan Parties and acceptable to the Administrative Agent in its sole
discretion (each being referred to as a "Lockbox Bank"), (B) establishing, and
during the term of this Agreement, maintaining an account (a "Collection
Account" and, collectively, the "Collection Accounts") in the name of the
Administrative Agent with each Lockbox Bank, and (C) establishing, and during
the term of this Agreement, maintaining the Depository Accounts set forth in
Schedule 8.01 or such other Depository Accounts after the Effective Date, all in
the name of the Administrative Agent, which will be subject to a depository
account agreement and with a depository bank satisfactory to the Administrative
Agent. The Loan Parties other than the Canadian Loan Parties shall irrevocably
instruct their Account Debtors, with respect to Accounts Receivable of such Loan
Parties, to remit all payments to be made by checks or other drafts to the
Lockboxes and/or the Depository
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Accounts and to remit all payments to be made by wire transfer or by Automated
Clearing House, Inc. payment as directed by the Administrative Agent and shall
instruct each Lockbox Bank to deposit all amounts received in its Lockbox to the
Collection Account at such Lockbox Bank on the day received or, if such day is
not a Business Day, on the next succeeding Business Day. Until the
Administrative Agent has advised the Borrowers to the contrary after the
occurrence and during the continuance of an Event of Default, the Loan Parties
other than the Canadian Loan Parties may and will enforce, collect and receive
all amounts owing on the Accounts Receivable of such Loan Parties for the
Administrative Agent's benefit and on the Administrative Agent's behalf, but at
the Loan Parties' expense; such privilege shall terminate, at the election of
any Agent, upon the occurrence and during the continuance of an Event of
Default. All Collections received directly by the Loan Parties from any of their
Account Debtors, as proceeds from Accounts Receivable of the Loan Parties, or as
proceeds of any other Collateral, shall be held by the Loan Parties in trust for
the Agents and the Lenders and upon receipt be deposited by the Loan Parties in
original form and no later than the next Business Day after receipt thereof into
a Collection Account or a Depository Account. The Loan Parties shall not
commingle such collections with their own funds or the funds of any of their
Subsidiaries or Affiliates or with the proceeds of any assets not included in
the Collateral. The Administrative Agent shall charge the Loan Account on the
last day of each month with two (2) collection days for all such Collections.
All funds received in the Collection Account or a Depository Account shall be
sent by wire transfer or Automated Clearing House, Inc. payment to the
Administrative Agent's Account for application at the end of each Business Day
to reduce the then principal balance of the Revolving Loans or as otherwise to
be applied in accordance with Section 2.05(d), conditional upon final payment to
the Administrative Agent. No checks, drafts or other instruments received by the
Administrative Agent shall constitute final payment to the Administrative Agent
unless and until such checks, drafts or instruments have actually been
collected.
(ii) Each Canadian Entity shall (A) establish,
and thereafter maintain, one or more depository and/or operating accounts, under
the dominion and control of the Administrative Agent and otherwise satisfactory
to Administrative Agent, in respect of each of its Collections and (B) instruct
all of their Account Debtors to remit all such Collections to such depository
accounts and/or operating accounts. Each Canadian Entity at all times promptly
shall deposit or cause to be deposited (including by electronic funds transfers)
all Collections into such accounts that are received by such Canadian Entity
from any source promptly, and in any event no later than the first Business Day
after the date of receipt thereof. Subject to the next sentence, each Canadian
Entity may use the funds on deposit in its foreign bank accounts for its working
capital purposes. In addition, during the continuance of an Event of Default,
the Administrative Agent shall have the right to convert all non-Dollar
denominated balances in each Canadian Entity's Canadian bank accounts into
Dollars (at the Borrowers' sole expense) and cause all amounts in such bank
accounts to be wired into a Collection Account or other bank accounts subject to
a control agreement, in form and substance satisfactory to the Administrative
Agent, and then wired from such bank accounts to the Administrative Agent's
Account. The arrangements contemplated in this Section 8.01(a) shall not be
modified by any Loan Party without the prior written consent of the
Administrative Agent.
(b) After the occurrence and during the continuance of an
Event of Default, the Collateral Agent may send a notice of assignment and/or
notice of the Lenders' security interest to any and all Account Debtors or third
parties holding or otherwise concerned
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with any of the Collateral, and thereafter the Collateral Agent shall have the
sole right to collect the Accounts Receivable and/or take possession of the
Collateral and the books and records relating thereto. The Designated Loan
Parties shall not, without prior written consent of the Collateral Agent, grant
any extension of time of payment of any Account Receivable, compromise or settle
any Account Receivable for less than the full amount thereof, release, in whole
or in part, any Person or property liable for the payment thereof, or allow any
credit or discount whatsoever thereon, except, in the absence of a continuing
Event of Default, as permitted by Section 7.02(o).
(c) Each Designated Loan Party hereby appoints each Agent
or its designee on behalf of such Agent as the Designated Loan Parties'
attorney-in-fact with power exercisable during the continuance of an Event of
Default to endorse any Designated Loan Party's name upon any notes, acceptances,
checks, drafts, money orders or other evidences of payment relating to the
Accounts Receivable, to sign any Designated Loan Party's name on any invoice or
bill of lading relating to any of the Accounts Receivable, drafts against
Account Debtors with respect to Accounts Receivable, assignments and
verifications of Accounts Receivable and notices to Account Debtors with respect
to Accounts Receivable, to send verification of Accounts Receivable, and to
notify the Postal Service authorities to change the address for delivery of mail
addressed to any Designated Loan Party to such address as such Agent may
designate and to do all other acts and things necessary to carry out this
Agreement. All acts of said attorney or designee are hereby ratified and
approved, and said attorney or designee shall not be liable for any acts of
omission or commission (other than acts of omission or commission constituting
gross negligence or willful misconduct as determined by a final judgment of a
court of competent jurisdiction), or for any error of judgment or mistake of
fact or law; this power being coupled with an interest is irrevocable until all
of the Loans, Reimbursement Obligations, Letter of Credit Obligations and other
Obligations under the Loan Documents are paid in full and all of the Loan
Documents are terminated.
(d) Nothing herein contained shall be construed to
constitute any Agent as agent of any Loan Party for any purpose whatsoever, and
the Agents shall not be responsible or liable for any shortage, discrepancy,
damage, loss or destruction of any part of the Collateral wherever the same may
be located and regardless of the cause thereof (other than from acts of omission
or commission constituting gross negligence or willful misconduct as determined
by a final judgment of a court of competent jurisdiction). The Agents shall not,
under any circumstance or in any event whatsoever, have any liability for any
error or omission or delay of any kind occurring in the settlement, collection
or payment of any of the Accounts Receivable or any instrument received in
payment thereof or for any damage resulting therefrom (other than acts of
omission or commission constituting gross negligence or willful misconduct as
determined by a final judgment of a court of competent jurisdiction). The
Agents, by anything herein or in any assignment or otherwise, do not assume any
of the obligations under any contract or agreement assigned to any Agent and
shall not be responsible in any way for the performance by any Loan Party of any
of the terms and conditions thereof.
(e) If any Account Receivable includes a charge for any
tax payable to any Governmental Authority, each Agent is hereby authorized (but
in no event obligated) in its discretion to pay the amount thereof to the proper
taxing authority for the Loan Parties' account and to charge the Loan Parties
therefor. The Borrowers shall notify the Agents if any Account
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Receivable includes any taxes due to any such Governmental Authority and, in the
absence of such notice, the Agents shall have the right to retain the full
proceeds of such Account Receivable and shall not be liable for any taxes that
may be due by reason of the sale and delivery creating such Account Receivable.
(f) Notwithstanding any other terms set forth in the Loan
Documents, the rights and remedies of the Agents and the Senior Lenders herein
provided, and the obligations of the Loan Parties set forth herein, are
cumulative of, may be exercised singly or concurrently with, and are not
exclusive of, any other rights, remedies or obligations set forth in any other
Loan Document or as provided by law.
Section 8.02 Accounts Receivable Documentation. The Designated Loan
Parties will at such intervals as the Agents may reasonably require, execute and
deliver confirmatory written assignments of the Accounts Receivable to the
Agents and furnish such further schedules and/or information as any such Agent
may require relating to the Accounts Receivable, including, without limitation,
sales invoices or the equivalent, credit memos issued, remittance advices,
reports and copies of deposit slips and copies of original shipping or delivery
receipts for all merchandise sold. In addition, the Administrative Borrower
shall notify the Agents of any non-compliance in respect of the representations,
warranties and covenants contained in Section 8.03. The items to be provided
under this Section 8.02 are to be in form reasonably satisfactory to the Agents
and are to be executed and delivered to the Agents from time to time solely for
their convenience in maintaining records of the Collateral. The Designated Loan
Parties' failure to give any of such items to the Agents shall not affect,
terminate, modify or otherwise limit the Collateral Agent's Lien on the
Collateral. The Designated Loan Parties shall not re-date any invoice or sale or
make sales on extended dating beyond that customary in the Designated Loan
Parties' industry, and shall not re-bill any Accounts Receivable without
promptly disclosing the same to the Agents and providing the Agents with a copy
of such re-billing, identifying the same as such. If any Designated Loan Party
becomes aware of anything materially detrimental to any of the Designated Loan
Parties' customers' credit, the Administrative Borrower will promptly advise the
Agents thereof.
Section 8.03 Status of Accounts Receivable and Other Collateral. With
respect to Collateral of any Designated Loan Party at the time the Collateral
becomes subject to the Collateral Agent's Lien, each Designated Loan Party
covenants, represents and warrants: (a) such Designated Loan Party shall be the
sole owner, free and clear of all Liens (except for the Liens granted in the
favor of the Collateral Agent for the benefit of the Lenders and Permitted
Liens), and shall be fully authorized to sell, transfer, pledge and/or grant a
security interest in each and every item of said Collateral; (b) each Eligible
Account Receivable shall be a good and valid account representing an undisputed
bona fide indebtedness incurred or an amount indisputably owed by the Account
Debtor therein named, for a fixed sum as set forth in the invoice relating
thereto with respect to an absolute sale and delivery upon the specified terms
of goods sold or services rendered by such Designated Loan Party; (c) no
Eligible Account Receivable shall be subject to any defense, offset,
counterclaim, discount or allowance except as may be stated in the invoice
relating thereto, discounts and allowances as may be customary in such
Designated Loan Party's business and as otherwise disclosed to the Agents, and
each Account Receivable will be paid when due; (d) none of the transactions
underlying or giving rise to any Account Receivable shall violate any applicable
state or federal laws or regulations (including, without limitation, any Motor
Vehicle Laws), and
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all documents relating thereto shall be legally sufficient under such laws or
regulations and shall be legally enforceable in accordance with their terms; (e)
no agreement under which any deduction or offset of any kind, other than normal
trade discounts, may be granted or shall have been made by such Designated Loan
Party at or before the time such Account Receivable is created; (f) all
agreements, instruments and other documents relating to any Account Receivable
shall be true and correct and in all material respects what they purport to be;
(g) all signatures and endorsements that appear on all material agreements,
instruments and other documents relating to any Account Receivable shall be
genuine and all signatories and endorsers shall have full capacity to contract;
(h) such Designated Loan Party shall maintain books and records pertaining to
said Collateral in such detail, form and scope as the Agents shall reasonably
require; (i) such Designated Loan Party shall immediately notify the Agents if
any Account Receivable arises out of contracts with any Governmental Authority,
and will execute any instruments and take any steps required by the Agents in
order that all monies due or to become due under any such contract shall be
assigned to the Collateral Agent and notice thereof given to such Governmental
Authority under the Federal Assignment of Claims Act or any similar state or
local law; (j) such Designated Loan Party will, immediately upon learning
thereof, report to the Agents any material loss or destruction of, or
substantial damage to, any of the Collateral, and any other matters affecting
the value, enforceability or collectibility of any of the Collateral; (k) if any
amount payable under or in connection with any Account Receivable is evidenced
by a promissory note or other instrument, such promissory note or instrument
shall be immediately pledged, endorsed, assigned and delivered to the Collateral
Agent for the benefit of the Lenders as additional Collateral; (l) such
Designated Loan Party shall not re-date any invoice or sale or make sales on
extended dating beyond that which is customary in the ordinary course of its
business and in the industry; and (m) such Designated Loan Party is not and
shall not be entitled to pledge any Agent's or any Senior Lender's credit on any
purchases or for any purpose whatsoever.
Section 8.04 Collateral Custodian. (a) Without limiting the Agents' or
the Lenders' rights with respect to the Collateral, the Collateral Agent has
implemented an arrangement, on terms and pursuant to written agreements in form
and substance satisfactory to the Collateral Agent, pursuant to which a third
party collateral custodian or agent, acceptable to the Collateral Agent
(together with any substitute or supplemental collateral custodian or agent, the
"Rolling Stock Collateral Custodian") has been engaged, at the expense of the
Borrowers, to hold physical possession of original certificates of title or
ownership, vehicle registrations and other similar instruments and documents
with respect to the Rolling Stock included in the Collateral, upon which
certificates of title or ownership the Collateral Agent's Liens shall be noted,
and pursuant to which arrangements, on terms and conditions satisfactory to the
Collateral Agent, the Rolling Stock Collateral Custodian will, among other
things, monitor and render reports to the Agents regarding the acquisition and
disposition of such Rolling Stock by the Loan Parties as permitted by this
Agreement, and receive and maintain documentation evidencing compliance with
vehicle titling and registration requirements under applicable law (including,
without limitation, all Motor Vehicle Law), and will assist and cooperate with
the Collateral Agent in making the necessary arrangements for such Liens and any
releases thereof with respect to the dispositions of Rolling Stock permitted
under this Agreement.
(b) Upon the occurrence and during the continuance of any
Default or Event of Default, the Collateral Agent may at any time and from time
to time employ and maintain on the premises of any Loan Party a custodian
selected by the Collateral Agent who
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shall have full authority to do all acts necessary to protect the Agents' and
the Lenders' interests. Each Loan Party hereby agrees to, and to cause its
Subsidiaries to, cooperate with any such custodian and to do whatever the
Collateral Agent may reasonably request to preserve the Collateral. All costs
and expenses incurred by the Collateral Agent by reason of the employment of the
custodian shall be the responsibility of the Borrowers and charged to the Loan
Account.
ARTICLE IX
EVENTS OF DEFAULT
Section 9.01 Events of Default. If any of the following Events of
Default shall occur and be continuing:
(a) any Borrower shall fail to pay any principal of or
interest on any Loan, any Agent Advance, any Reimbursement Obligation or any
fee, indemnity or other amount payable under this Agreement or any other Loan
Document when due (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise);
(b) any representation or warranty made or deemed made by
or on behalf of any Loan Party or by any officer of the foregoing under or in
connection with any Loan Document or under or in connection with any report,
certificate, or other document delivered to any Agent, any Lender or the L/C
Issuer pursuant to any Loan Document shall have been incorrect in any material
respect when made or deemed made;
(c) any Loan Party shall fail to perform or comply with
any covenant or agreement contained in (i) clauses (a), (b), (c), (d), (f), (h),
(j), (l), (m), (n), (o), (p), (q) or (r) of Section 7.01, Section 7.02 or
Section 7.03 or Article VIII, or any Loan Party shall fail to perform or comply
with any covenant or agreement contained in any Security Agreement to which it
is a party, any Pledge Agreement to which it is a party, any Mortgage to which
it is a party or any Canadian Security Document to which it is a party or (ii)
clauses (e), (g), (i) or (k) of Section 7.01 and such failure, if capable of
being remedied, shall remain unremedied for 5 days, after the earlier of the
date a senior officer of any Loan Party shall become aware of such failure and
the date written notice of such default shall have been given by any Agent or
Lender to such Loan Party;
(d) any Loan Party shall fail to perform or comply with
any other term, covenant or agreement contained in any Loan Document to be
performed or observed by it and, except as set forth in subsections (a), (b) and
(c) of this Section 9.01, such failure, if capable of being remedied, shall
remain unremedied for 15 days after the earlier of the date a senior officer of
any Loan Party becomes aware of such failure and the date written notice of such
default shall have been given by any Agent to such Loan Party;
(e) any Loan Party shall fail to pay any principal of or
interest on any of its Indebtedness (excluding Indebtedness evidenced by this
Agreement) in excess of $1,000,000, or any interest or premium thereon, when due
(whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise) and such failure shall continue after the applicable grace period, if
any, specified in the agreement or instrument relating to such
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Indebtedness, or any other default under any agreement or instrument relating to
any such Indebtedness, or any other event, shall occur and shall continue after
the applicable grace period, if any, specified in such agreement or instrument,
if the effect of such default or event is to accelerate, or to permit the
acceleration of, the maturity of such Indebtedness; or any such Indebtedness
shall be declared to be due and payable, or required to be prepaid (other than
by a regularly scheduled required prepayment), redeemed, purchased or defeased
or an offer to prepay, redeem, purchase or defease such Indebtedness shall be
required to be made, in each case, prior to the stated maturity thereof;
(f) any Loan Party (i) shall institute any proceeding or
voluntary case seeking to adjudicate it a bankrupt or insolvent, or seeking
dissolution, liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief or composition of it or its debts under any law relating to
bankruptcy, insolvency, reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for any such Person or for any substantial
part of its property, (ii) shall be generally not paying its debts as such debts
become due or shall admit in writing its inability to pay its debts generally,
(iii) shall make a general assignment for the benefit of creditors, or (iv)
shall take any action to authorize or effect any of the actions set forth above
in this subsection (f);
(g) any proceeding shall be instituted against any Loan
Party seeking to adjudicate it a bankrupt or insolvent, or seeking dissolution,
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief of debtors, or seeking the entry of an order for relief or the
appointment of a receiver, trustee, custodian or other similar official for any
such Person or for any substantial part of its property, and either such
proceeding shall remain undismissed or unstayed for a period of 45 days or any
of the actions sought in such proceeding (including, without limitation, the
entry of an order for relief against any such Person or the appointment of a
receiver, trustee, custodian or other similar official for it or for any
substantial part of its property) shall occur;
(h) any provision of any Loan Document shall at any time
for any reason (other than pursuant to the express terms thereof) cease to be
valid and binding on or enforceable against any Loan Party intended to be a
party thereto, or the validity or enforceability thereof shall be contested by
any party thereto, or a proceeding shall be commenced by any Loan Party or any
Governmental Authority having jurisdiction over any of them, seeking to
establish the invalidity or unenforceability thereof, or any Loan Party shall
deny in writing that it has any liability or obligation purported to be created
under any Loan Document;
(i) any Security Agreement, any Pledge Agreement, any
Mortgage, any Canadian Security Document or any other security document, after
delivery thereof pursuant hereto, shall for any reason fail or cease to create a
valid and perfected and, except to the extent permitted by the terms hereof or
thereof, first priority Lien in favor of the Collateral Agent for the benefit of
the Senior Lenders on any Collateral purported to be covered thereby;
(j) one or more judgments or orders for the payment of
money exceeding $500,000 in the aggregate shall be rendered against any Loan
Party and remain unsatisfied and either (i) enforcement proceedings shall have
been commenced by any creditor
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upon any such judgment or order, or (ii) there shall be a period of 10
consecutive days after entry thereof during which a stay of enforcement of any
such judgment or order, by reason of a pending appeal or otherwise, shall not be
in effect; provided, however, that any such judgment or order shall not give
rise to an Event of Default under this subsection (j) if and for so long as (A)
the amount of such judgment or order is covered by a valid and binding policy of
insurance between the defendant and the insurer covering full payment thereof
and (B) such insurer has been notified, and has not disputed the claim made for
payment, of the amount of such judgment or order;
(k) Allied Systems or Allied Canada individually is, or
the Loan Parties (taken as a whole) are, enjoined, restrained or in any way
prevented by the order of any court or any Governmental Authority from
conducting all or any material part of its or their business for more than
fifteen (15) days;
(l) any material damage to, or loss, theft or destruction
of, any Collateral, whether or not insured, or any strike, lockout, labor
dispute, embargo, condemnation, act of God or public enemy, or other casualty
which causes, for more than fifteen (15) consecutive days, the cessation or
substantial curtailment of revenue producing activities at any facility of any
Loan Party, if any such event or circumstance could reasonably be expected to
have a Material Adverse Effect;
(m) any cessation of a substantial part of the business
of Allied Systems or Allied Canada, individually, or the Loan Parties (taken as
a whole) for a period which materially and adversely affects the ability of such
Person or Persons to continue its or their business on a profitable basis;
(n) the loss, suspension or revocation of, or failure to
renew, any license or permit now held or hereafter acquired by any Loan Party,
if such loss, suspension, revocation or failure to renew could reasonably be
expected to have a Material Adverse Effect;
(o) the indictment, or the threatened indictment of any
Loan Party under any criminal statute, or commencement or threatened
commencement of criminal or civil proceedings against any Loan Party, pursuant
to which statute or proceedings the penalties or remedies sought or available
include forfeiture to any Governmental Authority of any material portion of the
property of such Loan Party;
(p) any Loan Party or any of its ERISA Affiliates shall
have made a complete or partial withdrawal from a Multiemployer Plan, and, as a
result of such complete or partial withdrawal, any Loan Party or any of its
ERISA Affiliates incurs a withdrawal liability in an annual amount exceeding
$1,000,000; or a Multiemployer Plan enters reorganization status under Section
4241 of ERISA, and, as a result thereof any Loan Party's or any of its ERISA
Affiliates' annual contribution requirements with respect to such Multiemployer
Plan increases in an annual amount exceeding $1,000,000;
(q) any Termination Event with respect to any Employee
Plan shall have occurred, and, 30 days after notice thereof shall have been
given to any Loan Party by any Agent, (i) such Termination Event (if
correctable) shall not have been corrected, and (ii) the then
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current value of such Employee Plan's vested benefits exceeds the then current
value of assets allocable to such benefits in such Employee Plan by more than
$1,000,000 (or, in the case of a Termination Event involving liability under
Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of
ERISA or Section 4971 or 4975 of the Code, the liability is in excess of such
amount);
(r) any Loan Party shall be liable for any Environmental
Liabilities or Costs the payment of which could reasonably be expected to have a
Material Adverse Effect;
(s) an event of default shall exist or occur under any
agreement, instrument or other document related to the Canadian Facility;
(t) a Change of Control shall have occurred;
(u) AH Industries ceases to be treated as a non-resident
owned investment corporation for Canadian income tax purposes unless AH
Industries either ceases to exist or becomes a Guarantor within thirty (30) days
of the cessation of such treatment and no other Default or Event of Default
shall have occurred and be continuing;
(v) (i) a contribution or premium required to be paid to
or in respect of any Canadian Plan is not paid in accordance with the terms
thereof, all applicable Canadian laws and regulations, or any applicable
Collective Bargaining Agreement or taxes, penalties or fees are owing or
exigible under the Canadian Plans beyond the date permitted for payment of same;
(ii) an investigation, litigation, administrative or other proceeding, action,
suit or claim (other than routine claims for benefits) is commenced or
instituted involving any Canadian Plan or its assets; (iii) the occurrence of an
event with respect to the Canadian Plans which would entitle any Person (without
the consent of the Loan Party) to wind-up or terminate any Canadian Plan, in
whole or in part, or which could adversely affect the tax status thereof; (iv)
any actuarial valuation for any Canadian Plan, whether or not such valuation is
filed with a Governmental Authority discloses a going concern unfunded actuarial
liability, past service unfunded liability or solvency deficiency in an amount
in excess of $1,000,000; or (v) the occurrence of a withdrawal or transfer of
assets from the Canadian Plans, other than benefit payments or permitted
expenses or other legally valid withdrawals, transfers or payments made in
accordance with the applicable laws;
(w) a Subordinated Term Loan D Event of Default shall
have occurred; or
(x) an event or development occurs which could reasonably
be expected to have a Material Adverse Effect;
then, and in any such event, the Collateral Agent may, and shall at the
request of the Required Lenders, by notice to the Administrative Borrower, (i)
terminate all or any portion of the Senior Commitments, whereupon all Senior
Commitments shall terminate immediately, (ii) declare all or any portion of the
Senior Loans and Reimbursement Obligations then outstanding to be due and
payable, whereupon all or such portion of the aggregate principal of all Senior
Loans and Reimbursement Obligations, all accrued and unpaid interest thereon,
all fees and all other amounts payable under this Agreement and the other Loan
Documents (other
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than any Subordinated Obligation) shall become due and payable immediately,
without presentment, demand, protest or further notice of any kind, all of which
are hereby expressly waived by each Loan Party and (iii) exercise any and all of
its other rights and remedies under applicable law, hereunder and under the
other Loan Documents; provided, however, that upon the occurrence of any Event
of Default described in subsection (f) or (g) of this Section 9.01, without any
notice to any Loan Party or any other Person or any act by any Agent or any
Senior Lender, all Senior Commitments shall automatically terminate and all
Senior Loans and Reimbursement Obligations then outstanding, together with all
accrued and unpaid interest thereon, all fees and all other amounts due under
this Agreement and the other Loan Documents shall become due and payable
automatically and immediately, without presentment, demand, protest or notice of
any kind, all of which are expressly waived by each Loan Party. Upon demand by
the Administrative Agent after the occurrence and during the continuation of any
Event of Default, the Borrowers shall deposit with the Administrative Agent with
respect to each Letter of Credit then outstanding cash in an amount equal to the
greatest amount for which such Letter of Credit may be drawn. Such deposits
shall be held by the Administrative Agent in an account under the sole and
exclusive control of the Administrative Agent for the benefit of the
Administrative Agent and/or the L/C Issuer as security for, and to provide for
the payment of, the Letter of Credit Obligations.
ARTICLE X
AGENTS
Section 10.01 Appointment. Each Senior Lender (and each subsequent
maker of any Senior Loan by its acceptance thereof) hereby irrevocably appoints
and authorizes the Administrative Agent and each Lender (and each subsequent
maker of any Loan or any Subordinated Term Loan D by its acceptance thereof)
hereby irrevocably appoints and authorizes the Collateral Agent to perform the
duties of each such Agent as set forth in this Agreement including: (i) to
receive on behalf of each Senior Lender any payment of principal of or interest
on the Loans outstanding hereunder and all other amounts accrued hereunder for
the account of the Senior Lenders and paid to such Agent, and, subject to
Section 2.02 of this Agreement, to distribute promptly to each Senior Lender its
Pro Rata Share of all payments so received; (ii) to distribute to each Senior
Lender copies of all material notices and agreements received by such Agent and
not required to be delivered to each Senior Lender pursuant to the terms of this
Agreement, provided that the Agents shall not be required to deliver copies of
any such notices and agreements received by the Agents to the Subordinated Term
Loan D Lenders and shall not have any liability to the Senior Lenders for any
Agent's inadvertent failure to distribute any such notices or agreements to the
Senior Lenders; (iii) to maintain, in accordance with its customary business
practices, ledgers and records reflecting the status of the Obligations, the
Senior Loans, and related matters and to maintain, in accordance with its
customary business practices, ledgers and records reflecting the status of the
Collateral and related matters; (iv) to execute or file any and all financing or
similar statements or notices, amendments, renewals, supplements, documents,
instruments, proofs of claim, notices and other written agreements with respect
to this Agreement or any other Loan Document; (v) to make the Senior Loans and
Agent Advances, for such Agent or on behalf of the applicable Senior Lenders as
provided in this Agreement or any other Loan Document; (vi) to perform,
exercise, and enforce any and all other rights and remedies of the Lenders with
respect to the Loan Parties, the Obligations, or otherwise related to any of
same to the
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extent reasonably incidental to the exercise by such Agent of the rights and
remedies specifically authorized to be exercised by such Agent by the terms of
this Agreement or any other Loan Document; (vii) to incur and pay such fees
necessary or appropriate for the performance and fulfillment of its functions
and powers pursuant to this Agreement or any other Loan Document; and (viii)
subject to Section 10.03 of this Agreement, to take such action as such Agent
deems appropriate on its behalf to administer the Loans and the Loan Documents
and to exercise such other powers delegated to such Agent by the terms hereof or
the other Loan Documents (including, without limitation, the power to give or to
refuse to give notices, waivers, consents, approvals and instructions and the
power to make or to refuse to make determinations and calculations) together
with such powers as are reasonably incidental thereto to carry out the purposes
hereof and thereof. As to any matters not expressly provided for by this
Agreement and the other Loan Documents (including, without limitation,
enforcement or collection of the Loans), the Agents shall not be required to
exercise any discretion or take any action, but shall be required to act or to
refrain from acting (and shall be fully protected in so acting or refraining
from acting) upon the instructions of the Required Lenders, and such
instructions of the Required Lenders shall be binding upon all Lenders and all
makers of Loans; provided, however, that the L/C Issuer shall not be required to
refuse to honor a drawing under any Letter of Credit and the Agents shall not be
required to take any action which, in the reasonable opinion of any Agent,
exposes such Agent to liability or which is contrary to this Agreement or any
other Loan Document or applicable law.
Section 10.02 Nature of Duties. The Agents shall have no duties or
responsibilities except those expressly set forth in this Agreement or in the
other Loan Documents. The duties of the Agents shall be mechanical and
administrative in nature. The Agents shall not have by reason of this Agreement
or any other Loan Document a fiduciary relationship in respect of any Lender.
Nothing in this Agreement or any other Loan Document, express or implied, is
intended to or shall be construed to impose upon the Agents any obligations in
respect of this Agreement or any other Loan Document except as expressly set
forth herein or therein. Each Lender shall make its own independent
investigation of the financial condition and affairs of the Loan Parties in
connection with the making and the continuance of the Loans hereunder and shall
make its own appraisal of the creditworthiness of the Loan Parties and the value
of the Collateral, and the Agents shall have no duty or responsibility, either
initially or on a continuing basis, to provide any Lender with any credit or
other information with respect thereto, whether coming into their possession
before the initial Loan hereunder or at any time or times thereafter, provided
that, upon the reasonable request of a Senior Lender, each Agent shall provide
to such Senior Lender any documents or reports delivered to such Agent by the
Loan Parties pursuant to the terms of this Agreement or any other Loan Document.
If any Agent seeks the consent or approval of the Required Lenders to the taking
or refraining from taking any action hereunder, such Agent shall send notice
thereof to each Senior Lender. Each Agent shall promptly notify each Senior
Lender any time that the Required Lenders have instructed such Agent to act or
refrain from acting pursuant hereto.
Section 10.03 Rights, Exculpation, Etc. The Agents and their directors,
officers, agents or employees shall not be liable for any action taken or
omitted to be taken by them under or in connection with this Agreement or the
other Loan Documents, except for their own gross negligence or willful
misconduct as determined by a final judgment of a court of competent
jurisdiction. Without limiting the generality of the foregoing, the Agents (i)
may treat the payee of any Loan or transferee of any Subordinated Term Loan D
Note as the owner thereof until the
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Agents receive written notice of the assignment or transfer thereof, pursuant to
Section 12.07 hereof or Annex 5, signed by such payee or transferee and in form
satisfactory to the Collateral Agent; (ii) may consult with legal counsel
(including, without limitation, counsel to any Agent or counsel to the Loan
Parties), independent public accountants, and other experts selected by any of
them and shall not be liable for any action taken or omitted to be taken in good
faith by any of them in accordance with the advice of such counsel or experts;
(iii) make no warranty or representation to any Lender and shall not be
responsible to any Lender for any statements, certificates, warranties or
representations made in or in connection with this Agreement or the other Loan
Documents; (iv) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of this
Agreement or the other Loan Documents on the part of any Person, the existence
or possible existence of any Default or Event of Default, or to inspect the
Collateral or other property (including, without limitation, the books and
records) of any Person; (v) shall not be responsible to any Lender for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of this Agreement or the other Loan Documents or any other instrument or
document furnished pursuant hereto or thereto; and (vi) shall not be deemed to
have made any representation or warranty regarding the existence, value or
collectibility of the Collateral, the existence, priority or perfection of the
Collateral Agent's Lien thereon, or any certificate prepared by any Loan Party
in connection therewith, nor shall the Agents be responsible or liable to the
Lenders for any failure to monitor or maintain any portion of the Collateral.
The Agents shall not be liable for any apportionment or distribution of payments
made in good faith pursuant to Section 4.04, and if any such apportionment or
distribution is subsequently determined to have been made in error the sole
recourse of any Lender to whom payment was due but not made, shall be to recover
from other Lenders any payment in excess of the amount which they are determined
to be entitled. The Agents may at any time request instructions from the Lenders
with respect to any actions or approvals which by the terms of this Agreement or
of any of the other Loan Documents the Agents are permitted or required to take
or to grant, and if such instructions are promptly requested, the Agents shall
be absolutely entitled to refrain from taking any action or to withhold any
approval under any of the Loan Documents until they shall have received such
instructions from the Required Lenders. Without limiting the foregoing, no
Lender shall have any right of action whatsoever against any Agent as a result
of such Agent acting or refraining from acting under this Agreement or any of
the other Loan Documents in accordance with the instructions of the Required
Lenders.
Section 10.04 Reliance. Each Agent shall be entitled to rely upon any
written notices, statements, certificates, orders or other documents or any
telephone message believed by it in good faith to be genuine and correct and to
have been signed, sent or made by the proper Person, and with respect to all
matters pertaining to this Agreement or any of the other Loan Documents and its
duties hereunder or thereunder, upon advice of counsel selected by it.
Section 10.05 Indemnification. To the extent that any Agent or the L/C
Issuer is not reimbursed and indemnified by any Loan Party, the Lenders will
reimburse and indemnify such Agent and the L/C Issuer from and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses, advances or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by, or asserted against such Agent
or the L/C Issuer in any way relating to or arising out of this Agreement or any
of the other Loan Documents or any action taken or omitted by such Agent or the
L/C Issuer under this Agreement or any of the other Loan Documents, in
proportion to each Lender's Pro Rata Share, including,
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without limitation, advances and disbursements made pursuant to Section 10.08;
provided, however, that (i) no Lender shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses, advances or disbursements for which there has been a final
judicial determination that such liability resulted from such Agent's or the L/C
Issuer's gross negligence or willful misconduct and (ii) no Subordinated Term
Loan D Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses, advances
or disbursements not arising from or relating to the Collateral or otherwise
arising from or relating to the Collateral Agent's capacity or duties as
Collateral Agent. The obligations of the Lenders under this Section 10.05 shall
survive the payment in full of the Loans and the termination of this Agreement.
Section 10.06 Agents Individually. With respect to its Pro Rata Share
of the Total Commitment hereunder and the Loans made by it, each Agent shall
have and may exercise the same rights and powers hereunder and is subject to the
same obligations and liabilities as and to the extent set forth herein for any
other Senior Lender or maker of a Senior Loan. The terms "Lenders", "Senior
Lenders" or "Required Lenders" or any similar terms shall, unless the context
clearly otherwise indicates, include each Agent in its individual capacity as a
Senior Lender or one of the Required Lenders. Each Agent and its Affiliates may
accept deposits from, lend money to, and generally engage in any kind of
banking, trust or other business with any Borrower as if it were not acting as
an Agent pursuant hereto without any duty to account to the other Lenders.
Section 10.07 Successor Agent. (a) Each Agent may resign from the
performance of all its functions and duties hereunder and under the other Loan
Documents at any time by giving at least thirty (30) Business Days' prior
written notice to the Administrative Borrower and each Senior Lender. Such
resignation shall take effect upon the acceptance by a successor Agent of
appointment pursuant to clauses (b) and (c) below or as otherwise provided
below.
(b) Upon any such notice of resignation, the Required
Lenders shall appoint a successor Agent. Upon the acceptance of any appointment
as Agent hereunder by a successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Agent, and the retiring Agent shall be discharged from its
duties and obligations under this Agreement and the other Loan Documents. After
any Agent's resignation hereunder as an Agent, the provisions of this Article X
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was an Agent under this Agreement and the other Loan Documents.
(c) If a successor Agent shall not have been so appointed
within said thirty (30) Business Day period, the retiring Agent, with the
consent of the other Agent shall then appoint a successor Agent who shall serve
as an Agent until such time, if any, as the Required Lenders, with the consent
of the other Agent, appoint a successor Agent as provided above.
(d) Upon the occurrence of the Senior Facility
Termination Date, each of the Agents agrees to resign and, immediately upon such
resignation, the Subordinated Term Loan D Lenders (or their designee) shall
automatically and without further action be appointed the successor Agents.
Nothing contained in this clause (d) shall be construed to limit or eliminate
either Agent's right to resign as an Agent in accordance with this Section
10.07.
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Section 10.08 Collateral Matters.
(a) Any Agent may from time to time make such
disbursements and advances ("Agent Advances") which any Agent, in its sole
discretion, deems necessary or desirable to preserve, protect, prepare for sale
or lease or dispose of the Collateral or any portion thereof, to preserve or
protect the likelihood or maximize the amount of repayment by the Borrowers of
the Senior Loans, Reimbursement Obligations, Letter of Credit Obligations and
other Senior Obligations and, after the Senior Facility Termination Date, the
Subordinated Obligations or to pay any other amount chargeable to the Borrowers
pursuant to the terms of this Agreement, including, without limitation, costs,
fees and expenses as described in Section 12.04. The Agent Advances shall be
repayable on demand and be secured by the Collateral and shall bear interest at
a rate per annum equal to rate of interest then applicable to the Term Loan B.
The Agent Advances shall constitute Senior Obligations hereunder which may be
charged to the Loan Account in accordance with Section 4.02. The Agent making
such Agent Advance shall notify the other Agent and each Senior Lender and the
Borrowers in writing of each such Agent Advance, which notice shall include a
description of the purpose of such Agent Advance. Without limitation to its
obligations pursuant to Section 10.05, each Senior Lender agrees that it shall
make available to the Agent making such Agent Advance, upon such Agent's demand,
in Dollars in immediately available funds, the amount equal to such Senior
Lender's Pro Rata Share of each such Agent Advance. If such funds are not made
available to the Agent making such Agent Advance by such Senior Lender, such
Agent shall be entitled to recover such funds on demand from such Senior Lender,
together with interest thereon for each day from the date such payment was due
until the date such amount is paid to Agent, at the Federal Funds Rate for three
Business Days and thereafter at the Reference Rate.
(b) The Lenders hereby irrevocably authorize the
Collateral Agent, at its option and in its discretion, to release any Lien
granted to or held by the Collateral Agent upon any Collateral constituting
property being sold or disposed of in the ordinary course of any Loan Party's
business and in compliance with the terms of this Agreement and the other Loan
Documents; or constituting property in which the Loan Parties owned no interest
at the time the Lien was granted or at any time thereafter; or if approved,
authorized or ratified in writing by the Senior Lenders; provided, however, that
prior to the occurrence of the Senior Facility Termination Date, the Collateral
Agent may only release the Liens on the Collateral to the extent the Liens on
such Collateral are released both with respect to the Senior Obligations and the
Subordinated Obligations. Upon request by the Collateral Agent at any time, the
Lenders will confirm in writing the Collateral Agent's authority to release
particular types or items of Collateral pursuant to this Section 10.08(b). To
the maximum extent permitted by law, the Subordinated Term Loan D Lenders waive
any right to assert that any release, sale, transfer or other disposition of any
Collateral by the Collateral Agent was not made on commercially reasonable
terms. If the Senior Obligations are repaid in full in cash from cash generated
from the operations of the Parent and its Subsidiaries at a time when there
exists no Default or Event of Default and all or a portion of the Subordinated
Obligations remain outstanding, upon the occurrence of the Senior Facility
Termination Date the Collateral Agent will not release the Liens on the
Collateral securing the Subordinated Obligations.
(c) Without in any manner limiting the Collateral Agent's
authority to act without any specific or further authorization or consent by the
Lenders (as set forth in Section
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10.08(b)), each Lender agrees to confirm in writing, upon request by the
Collateral Agent, the authority to release Collateral conferred upon the
Collateral Agent under Section 10.08(b). Upon receipt by the Collateral Agent of
confirmation from the Lenders of its authority to release any particular item or
types of Collateral, and upon prior written request by any Loan Party, the
Collateral Agent shall (and is hereby irrevocably authorized by the Lenders to)
execute such documents as may be necessary to evidence the release of the Liens
granted to the Collateral Agent for the benefit of the Lenders upon such
Collateral; provided, however, that (i) the Collateral Agent shall not be
required to execute any such document on terms which, in the Collateral Agent's
opinion, would expose the Collateral Agent to liability or create any
obligations or entail any consequence other than the release of such Liens
without recourse or warranty, and (ii) such release shall not in any manner
discharge, affect or impair the Senior Obligations or any Lien upon (or
obligations of any Loan Party in respect of) all interests in the Collateral
retained by any Loan Party.
(d) The Collateral Agent shall have no obligation
whatsoever to any Lender to assure that the Collateral exists or is owned by the
Loan Parties or is cared for, protected or insured or has been encumbered or
that the Lien granted to the Collateral Agent pursuant to this Agreement or any
other Loan Document has been properly or sufficiently or lawfully created,
perfected, protected or enforced or is entitled to any particular priority, or
to exercise at all or in any particular manner or under any duty of care,
disclosure or fidelity, or to continue exercising, any of the rights,
authorities and powers granted or available to the Collateral Agent in this
Section 10.08 or in any other Loan Document, it being understood and agreed that
in respect of the Collateral, or any act, omission or event related thereto, the
Collateral Agent may act in any manner it may deem appropriate, in its sole
discretion, given the Collateral Agent's own interest in the Collateral as one
of the Senior Lenders and that the Collateral Agent shall have no duty or
liability whatsoever to any other Lender, except as otherwise provided herein.
Section 10.09 Collateral Sub-Agents. Each Lender hereby appoints each
Agent and each other Lender as agent and bailee for the purpose of perfecting
the Liens upon the Collateral in assets which, in accordance with Article 9 of
the Uniform Commercial Code, can be perfected only by possession or control (or
where the security interest of a secured party with possession or control has
priority over the security interest of another secured party) and each Agent and
each Lender hereby acknowledge that it holds possession of or otherwise controls
any such Collateral in accordance with the Collateral Agent's instructions as
secured party. Should any Lender obtain possession or control of any such
Collateral, such Lender shall notify the Collateral Agent thereof, and, promptly
upon the Collateral Agent's request therefor shall deliver such Collateral to
the Collateral Agent for the benefit of the Lenders. Each Loan Party by its
execution and delivery of this Agreement hereby consents to the foregoing.
ARTICLE XI
GUARANTY
Section 11.01 Guaranty. Each Guarantor hereby unconditionally and
irrevocably guarantees the punctual payment when due, whether at stated
maturity, by acceleration or otherwise, of all Obligations of the Borrowers now
or hereafter existing under any Loan
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Document, whether for principal, interest (including without limitation, all
interest that accrues after the commencement of any Insolvency Proceeding of the
Borrowers, whether or not a claim for post-filing interest is allowed in such
proceeding), all Letter of Credit Obligations, fees, commissions, expense
reimbursements, indemnifications or otherwise (such obligations, to the extent
not paid by the Borrowers, being the "Guaranteed Obligations"), and agrees to
pay any and all expenses (including reasonable counsel fees and expenses)
incurred by the Agents, the Lenders and the L/C Issuer in enforcing any rights
under the guaranty set forth in this Article. Without limiting the generality of
the foregoing, each Guarantor's liability shall extend to all amounts that
constitute part of the Guaranteed Obligations and would be owed by the Borrowers
to the Agents, the Lenders and the L/C Issuer under any Loan Document but for
the fact that they are unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving any Borrower.
Section 11.02 Guaranty Absolute. Each Guarantor guarantees that the
Guaranteed Obligations will be paid strictly in accordance with the terms of the
Loan Documents, regardless of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of the
Agents, the Lenders or the L/C Issuer with respect thereto. The obligations of
each Guarantor under this Article XI are independent of the Guaranteed
Obligations, and a separate action or actions may be brought and prosecuted
against each Guarantor to enforce such obligations, irrespective of whether any
action is brought against any Borrower or whether any Borrower is joined in any
such action or actions. The liability of each Guarantor under this Article XI
shall be irrevocable, absolute and unconditional irrespective of, and each
Guarantor hereby irrevocably waives any defenses it may now or hereafter have in
any way relating to, any or all of the following:
(a) any lack of validity or enforceability of any Loan
Document or any agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment
of, or in any other term of, all or any of the Guaranteed Obligations, or any
other amendment or waiver of or any consent to departure from any Loan Document,
including, without limitation, any increase in the Guaranteed Obligations
resulting from the extension of additional credit to any Borrower or otherwise;
(c) any taking, exchange, release or non-perfection of
any Collateral, or any taking, release or amendment or waiver of or consent to
departure from any other guaranty, for all or any of the Guaranteed Obligations;
(d) any change, restructuring or termination of the
corporate, limited liability company or partnership structure or existence of
any Borrower; or
(e) any other circumstance (including, without
limitation, any statute of limitations) or any existence of or reliance on any
representation by the Agents, the Lenders or the L/C Issuer that might otherwise
constitute a defense available to, or a discharge of, any Guarantor, any
Borrower or any other guarantor or surety.
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This Article XI shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Guaranteed Obligations is rescinded
or must otherwise be returned by the Agents, the Lenders, the L/C Issuer or any
other Person upon the insolvency, bankruptcy or reorganization of any Borrower
or otherwise, all as though such payment had not been made.
Section 11.03 Waiver. Each Guarantor hereby waives promptness,
diligence, notice of acceptance and any other notice with respect to any of the
Guaranteed Obligations and this Article XI and any requirement that the Agents,
the Lenders or the L/C Issuer exhaust any right or take any action against any
Borrower or any other Person or any Collateral. Each Guarantor acknowledges that
it will receive direct and indirect benefits from the financing arrangements
contemplated herein and that the waiver set forth in this Section 11.03 is
knowingly made in contemplation of such benefits. Each Guarantor hereby waives
any right to revoke this Article XI, and acknowledges that this Article XI is
continuing in nature and applies to all Guaranteed Obligations, whether existing
now or in the future.
Section 11.04 Continuing Guaranty; Assignments. This Article XI is a
continuing guaranty and shall (a) remain in full force and effect until the
later of the cash payment in full of the Guaranteed Obligations (other than
indemnification obligations as to which no claim has been made) and all other
amounts payable under this Article XI and the Final Senior Loan Maturity Date,
(b) be binding upon each Guarantor, its successors and assigns and (c) inure to
the benefit of and be enforceable by the Agents, the Lenders and the L/C Issuer
and their successors, pledgees, transferees and assigns. Without limiting the
generality of the foregoing clause (c), any Lender may pledge, assign or
otherwise transfer all or any portion of its rights and obligations under this
Agreement (including, without limitation, all or any portion of its Commitments,
its Loans, the Reimbursement Obligations and the Letter of Credit Obligations
owing to it) to any other Person, and such other Person shall thereupon become
vested with all the benefits in respect thereof granted such Lender herein or
otherwise, in each case as provided in Section 12.07.
Section 11.05 Subrogation. (a) Until the final payment in cash and
performance in full of all of the Obligations, none of the Guarantors shall
exercise any rights against either of the Borrowers or any other Guarantor (and
no Borrower shall exercise any right against the other Borrower) arising as a
result of payment by such Borrower or such Guarantor hereunder, by way of
subrogation, reimbursement, restitution, contribution or otherwise, and will not
prove any claim in competition with the Agents, any Lender or the L/C Issuer in
respect of any payment hereunder in any Insolvency Proceedings; none of the
Guarantors will claim any setoff, recoupment or counterclaim against such
Borrower or any other Guarantor in respect of any liability of such Guarantor to
such Borrower or Guarantor; and each Borrower and each Guarantor waives any
benefit of and any right to participate in any collateral security which may be
held by the Agents, any Lender or the L/C Issuer.
(b) The payment of any amounts due with respect to any
Indebtedness of either of the Borrowers or any other Guarantor for money
borrowed or credit received now or hereafter owed to any of the Guarantors is
hereby subordinated to the prior payment in full of all of the Obligations. Each
of the Guarantors agrees that, after the occurrence of any Default, such
Guarantor will not demand, sue for or otherwise attempt to collect any such
Indebtedness of the Borrowers or any other Guarantor to such Guarantor until all
of the Obligations shall have been paid in full. If, notwithstanding the
foregoing sentence, any Guarantor shall collect, enforce or
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receive any amounts in respect of such indebtedness while any Obligations are
still outstanding, such amounts shall be collected, enforced and received by
such Guarantor as trustee for the Agents, the Lenders and the L/C Issuer and be
paid over to the Administrative Agent, for the benefit of the Agents, the
Lenders and the L/C Issuer, on account of the Obligations without affecting in
any manner the liability of any of the Guarantors under the other provisions of
this Guaranty.
Section 11.06 Interest Act (Canada); Criminal Rate of Interest; Nominal
Rate of Interest. (a) Notwithstanding anything to the contrary contained in this
Agreement or in any other Loan Document, solely to the extent that a court of
competent jurisdiction finally determines that the calculation or determination
of interest payable by any Guarantor that is a Canadian Entity in respect of the
Guaranteed Obligations pursuant to this Agreement and the other Loan Documents
shall be governed by the laws of the province of Ontario or the federal laws of
Canada:
(b) Whenever interest payable by any Guarantor that is a
Canadian Entity is calculated on the basis of a period which is less than the
actual number of days in a calendar year, each rate of interest determined
pursuant to such calculation is, for the purposes of the Interest Act (Canada),
equivalent to such rate multiplied by the actual number of days in the calendar
year in which such rate is to be ascertained and divided by the number of days
used as the basis of such calculation.
(c) In no event shall the aggregate "interest" (as
defined in Section 347 of the Criminal Code, R.S.C. 1985, c. C-46, as the same
shall be amended, replaced or re-enacted from time to time) payable by any
Guarantor that is a Canadian Entity to the Agents or any Lender under this
Agreement or any other Loan Document exceed the effective annual rate of
interest on the "credit advances" (as defined in that section) under this
Agreement or such other Loan Document lawfully permitted under that section and,
if any payment, collection or demand pursuant to this Agreement or any other
Loan Document in respect of "interest" (as defined in that section) is
determined to be contrary to the provisions of that section, such payment,
collection or demand shall be deemed to have been made by mutual mistake of the
Agents, the Lenders and the Guarantors that are Canadian Guarantors making such
payment and the amount of such payment or collection shall be refunded by the
Agents and the Lenders to such Guarantor. For the purposes of this Agreement and
each other Loan Document to which a Canadian Guarantor is a party, the effective
annual rate of interest payable by such Guarantor shall be determined in
accordance with generally accepted actuarial practices and principles over the
term of the Loans, on the basis of annual compounding for the lawfully permitted
rate of interest and, in the event of dispute, a certificate of a Fellow of the
Canadian Institute of Actuaries appointed by the Agents for the account of such
Guarantor will be conclusive for the purpose of such determination in the
absence of evidence to the contrary.
(d) All calculations of interest payable by any Guarantor
that is a Canadian Guarantor under this Agreement or any other Loan Document are
to be made on the basis of the nominal interest rate described herein and
therein and not on the basis of effective yearly rates or on any other basis
which gives effect to the principle of deemed reinvestment of interest. The
parties acknowledge that there is a material difference between the stated
nominal interest rates and the effective yearly rates of interest and that they
are capable of making the calculations required to determine such effective
yearly rates of interest.
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Section 11.07 Judgment Currency. The specification under this Agreement
of Dollars and payment in New York City is of the essence. Each Guarantor's
obligations hereunder and under the other Loan Documents to make payments in
Dollars and shall not be discharged or satisfied by any tender or recovery
pursuant to any judgment expressed in or converted into any currency other than
Dollars, except to the extent that such tender or recovery results in the
effective receipt by the Lenders, the Agents or the L/C Issuer of the full
amount of Dollars expressed to be payable to the Agents, the Lenders of the L/C
Issuer under this Agreement or the other Loan Documents. If, for the purpose of
obtaining or enforcing judgment in any court, it is necessary to convert into or
from any currency other than Dollars (such other currency being hereinafter
referred to as the "Judgment Currency") an amount due in Dollars, the rate of
exchange used shall be that at which the Lenders, the Agents or the L/C Issuer
could, in accordance with normal banking procedures, purchase Dollars with the
Judgment Currency on the Business Day preceding that on which final judgment is
given. The obligation of each Guarantor in respect of any such sum due from it
to the Lenders, the Agents or the L/C Issuer hereunder shall, notwithstanding
any judgment in such Judgment Currency, be discharged only to the extent that,
on the Business Day immediately following the date on which the Lenders, the
Agents or the L/C Issuer receives any sum adjudged to be so due in the Judgment
Currency, the Lenders, the Agents or the L/C Issuer may, in accordance with
normal banking procedures, purchase Dollars with the Judgment Currency. If the
Dollars so purchased are less than the sum originally due to the Agents, the
Lenders or the L/C Issuer in Dollars, each Guarantor agrees, as a separate
obligation and notwithstanding any such judgment, to indemnify the Lenders, the
Agents or the L/C Issuer against such loss, and if the Dollars so purchased
exceed the sum originally due to the Lenders, the Agents or the L/C Issuer in
Dollars, the Lenders, the Agents or the L/C Issuer agrees to remit to such
Guarantor such excess.
ARTICLE XII
MISCELLANEOUS
Section 12.01 Notices, Etc. All notices and other communications
provided for hereunder shall be in writing and shall be mailed, telecopied or
delivered, if to any Loan Party, at the following address:
c/o Allied Holdings, Inc.
160 Clairemont Avenue
Suite 200
Decatur, Georgia 30030
Attention: Chief Financial Officer
Telephone: 404-371-0379
Telecopier: 404-370-4206
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with a copy to:
Troutman Sanders LLP
600 Peachtree Street
Suite 5200
Atlanta, Georgia 30308
Attention: Hazen H. Dempster, Esq.
Telephone: 404-885-3126
Telecopier: 404-962-6544
if to the Administrative Agent, to it at the following address:
Foothill Capital Corporation
400 North Park Town Center
1000 Abernathy Road, Suite 1450
Atlanta, Georgia 30328
Attention: Business Finance Division Manager
Telephone: 770-508-1300
Telecopier: 770-508-1375
with copies to:
Foothill Capital Corporation
2450 Colorado Avenue
Suite 3000 West
Santa Monica, California 90404
Attention: Business Finance Division Manager
Telephone: 310-453-7300
Telecopier: 310-453-7444
and
Brobeck Phleger & Harrison LLP
550 South Hope Street
Los Angeles, California 90071
Attention: John Francis Hilson, Esq.
Telephone: 213-489-4060
Telecopier: 213-745-3345
if to the Collateral Agent, to it at the following address:
Ableco Finance LLC
450 Park Avenue, 28th Floor
New York, New York 10022
Attention: Mr. Eric F. Miller
Telephone: 212-891-2100
Telecopier: 212-758-5305
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in each case, with a copy to:
Schulte Roth & Zabel LLP
919 Third Avenue
New York, New York 10022
Attention: Frederic L. Ragucci, Esq.
Telephone: 212-756-2000
Telecopier: 212-593-5955
if to the Subordinated Term Loan D Lenders, to each of them at their
respective addresses set forth on Schedule 1.01(A) hereto.
or, as to each party, at such other address as shall be designated by such party
in a written notice to the other parties complying as to delivery with the terms
of this Section 12.01. All such notices and other communications shall be
effective, (i) if mailed, when received or three days after deposited in the
mails, whichever occurs first, (ii) if telecopied, when transmitted and
confirmation received, or (iii) if delivered, upon delivery, except that notices
to any Agent or the L/C Issuer pursuant to Articles II and III shall not be
effective until received by such Agent or the L/C Issuer, as the case may be.
Section 12.02 Amendments, Etc. (a) Subject to the provisions set forth
in this Section 12.02, no amendment or waiver of any provision of this Agreement
or any other Loan Document, and no consent to any departure by any Loan Party
herefrom or therefrom, shall in any event be effective unless the same shall be
in writing and signed by the Required Lenders or by the Agents with the consent
of the Required Lenders, and then such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given, provided,
however, that no amendment, waiver or consent shall (i) increase the Commitment
of any Senior Lender, reduce the principal of, or interest on, the Loans or the
Reimbursement Obligations payable to any Senior Lender, reduce the amount of any
fee payable for the account of any Senior Lender, or postpone or extend any date
fixed for any payment of principal of, or interest or fees on, the Loans or
Letter of Credit Obligations payable to any Senior Lender, in each case without
the written consent of any Senior Lender affected thereby, (ii) increase the
Total Commitment or amend the definitions of the terms "Total Revolving Credit
Commitment" or "Revolving Credit Commitment", which results in an increase in
any such amount without the written consent of each Senior Lender, (iii) change
the percentage of the Commitments or of the aggregate unpaid principal amount of
the Loans that is required for the Senior Lenders or any of them to take any
action hereunder, (iv) amend the definitions of the terms "Availability",
"Borrowing Base", "Final Senior Loan Maturity Date", "Required Lenders",
"Required Revolving Lenders", "Pro Rata Share", "Revolving Loan Obligations",
"Senior Loans" or "Senior Facility Termination Date", (v) release all or a
substantial portion of the Collateral (except as otherwise provided in this
Agreement and the other Loan Documents), subordinate any Lien granted in favor
of the Collateral Agent for the benefit of the Lenders, or release any Borrower
or any Guarantor, (vi) amend or modify Section 4.04 or this Section 12.02 of
this Agreement, or (vii) amend the definitions of the terms "Designated Loan
Party", "Axis Entity", "Collections", "Availability Deficiency", "Dollar
Equivalent", "Dilution", "Dilution Reserve", "Eligible Rolling Stock", "Eligible
Accounts Receivable", "Net Book Value ", "Rolling Stock Depreciation Amount",
"Significant Customer", "Gross Orderly Liquidation Value" or "Net Amount of
Eligible Accounts Receivable", that would
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result in an increase in the Borrowing Base (or in any definition contained in
the Financing Agreement used in connection with the definition of the foregoing
terms that would result in an increase in the Borrowing Base), in the case of
each of clauses (iii) through (vii) above, without the written consent of each
Senior Lender. Notwithstanding the foregoing, no amendment, waiver or consent
shall, unless in writing and signed by an Agent, affect the rights or duties of
such Agent (but not in its capacity as a Lender) under this Agreement or the
other Loan Documents.
(b) The Administrative Agent, the Collateral Agent and
each Senior Lender have executed an agreement among lenders and a side letter on
the Effective Date pursuant to which the Administrative Agent, the Collateral
Agent and each Senior Lender have agreed, among other things, to certain voting
arrangements relative to matters requiring the approval of the Senior Lenders.
The rights and duties of the Administrative Agent, the Collateral Agent and each
Senior Lender with respect to such matters, are subject to such agreement and
letter.
(c) Without the approval of the Required Subordinated
Lenders the Senior Lenders may not (i) increase the principal amount of the
Senior Obligations in excess of the Maximum Senior Principal Amount, provided
that, for the avoidance of doubt, the limitation contained in this clause (i)
does not apply to any interest, including capitalized interest, fees, expense
reimbursements and indemnities whether or not such amounts are charged to the
Loan Account, (ii) amend or otherwise modify, in a manner adverse to the
Subordinated Term Loan D Lenders, the definitions of the terms "Maximum Senior
Principal Amount, "Senior Facility Termination Date", "Subordinated
Obligations", "Subordinated Term Loan D", "Subordinated Term Loan D Commitments,
"Subordinated Term Loan D Maturity Date", "Subordinated Term Loan D Event of
Default", Subordinated Term Loan D Lenders" or "Subordinated Term Loan D Notes",
(iii) amend or otherwise modify, in a manner adverse to the Subordinated Term
Loan D Lenders, Sections 2.01(a)(v), 2.01(b)(ii)(D), 2.01(b)(iii) (to the extent
any such amendment or modification is with respect to the Subordinated Term Loan
D), 2.02(a)(ii), 2.03(b)(iv), 2.04(b)(iv), 2.04(c)(ii), 2.04(d)(ii), 4.04(f),
10.07(d), 10.08(b) (to the extent any such amendment or modification is with
respect to the release of Collateral), 12.02(c), 12.02(d), 12.02(e), 12.02(f),
12.02(g) or 12.02(h), (iv) amend or otherwise modify Sections 2.05(d)(iii),
2.05(d)(iv), 2.05(d)(vi), 4.04(b) or 4.04(e) (A) to add to such sections
additional Obligations to be paid under such sections, other than Senior
Obligations in an aggregate principal amount not in excess of the Maximum Senior
Principal Amount, with a payment priority prior to that of the Subordinated
Obligations or (B) to eliminate from such sections the requirement to pay the
Subordinated Obligations, provided, that this clause (iv) shall not prohibit or
otherwise restrict the Agents and/or the Senior Lenders from allowing a third
party to receive proceeds of Collateral, prior to the Senior Facility
Termination Date, for application to obligations owed to such third party, (v)
amend or otherwise modify the definition of the term "Pro Rata Share" or Section
10.05 to the extent any such amendment or modification would increase the
indemnification obligations of the Subordinated Term Loan D Lenders, or (vi)
amend or otherwise modify Article XI or any Guaranty to the extent such
amendment or modification would release any Guarantor from liability under
Article XI or its Guaranty or reduce the liability of any Guarantor, in each
such case to the extent such amendment or modification is with respect to its
guarantee obligations for the Subordinated Obligations, provided, that,
notwithstanding the foregoing, the Agents and/or the Required Lenders may
release any Guarantor from its obligations to guarantee both the Senior
Obligations and the Subordinated Obligations in connection with any sale or
other
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disposition of the Capital Stock of, or all or substantially all of the assets
of, any Guarantor, whether by merger, consolidation, amalgamation or otherwise,
whether or not an Event of Default has occurred or is continuing.
Notwithstanding anything to the contrary in the immediately preceding sentence
or any other provision in the Loan Documents, solely for purposes of voting on
amendments, waivers and consents with respect to the Loan Documents, the
Subordinated Term Loan D Lenders shall be deemed not to be a "Lender" and the
Subordinated Term Loan D Commitments and the Subordinated Term Loan D shall be
deemed to be zero and the Agents and/or the Required Lenders may release the
Liens on the Collateral to the extent the Liens on such Collateral are released
both with respect to the Senior Obligations and the Subordinated Obligations.
Without the prior written consent of the Senior Lenders, the Subordinated Term
Loan D Lenders may not amend or otherwise modify any term or provision set forth
in Annexes 1, 2, 3, 4, or 5; provided, however, that the Required Subordinated
Lenders may, without the prior written consent of the Senior Lenders, amend or
otherwise modify Annex 5 to the extent such amendment or modification relates
solely to administrative matters and to matters adverse to the Senior Lenders or
the Agents. Without the prior written consent of the Required Subordinated
Lenders, the Senior Lenders may not amend or otherwise modify any term or
provision set forth in Annexes 1, 2, 3, 4 or 5. Except as otherwise provided in
this Section 12.02(c), the Senior Lenders may amend, modify or waive any term or
provision of the Loan Documents without the consent of any Subordinated Term
Loan D Lender, and the effectiveness of any such amendment, modification or
waiver shall not require any action by any Subordinated Term Loan D Lender.
(d) During any Insolvency Proceeding involving any Loan
Party, the Senior Lenders shall be entitled to vote the claim of the
Subordinated Term Loan D with respect to any matters arising from or relating to
the Collateral (including permitting the use of cash collateral,
debtor-in-possession financing or post-petition financing), including, without
limitation, enforcing the Liens on the Collateral, in each case as the Senior
Lenders may reasonably deem necessary or advisable for the exercise or
enforcement of any of the rights or interests of the Senior Lenders hereunder,
or the treatment of any Collateral in any proposed plan of reorganization so
long as the rights of the Subordinated Term Loan D Lenders in the Collateral
shall be the same as they existed before the commencement of such Insolvency
Proceeding.
(e) If any Loan Party shall become subject to an
Insolvency Proceeding, and if the Senior Lenders shall desire to permit the use
of cash collateral or to provide post-petition financing to the Loan Parties,
the Subordinated Term Loan D Lenders agree as follows: (i) adequate notice to
the Subordinated Term Loan D Lenders shall be deemed to have been provided for
such use of cash collateral or post-petition financing if the Subordinated Term
Loan D Lenders receive notice thereof at least three (3) Business Days prior to
any hearing on a request to approve such use of cash collateral or post-petition
financing; and (ii) no objection will be raised by the Subordinated Term Loan D
Lenders to any such use of cash collateral or such post-petition financing by
the Senior Lenders, provided that, the rights of the Subordinated Term Loan D
Lenders in the Collateral are the same as they existed before the commencement
of the Insolvency Proceeding; provided, however, that with respect to any
post-petition financing, the consent of the Required Subordinated Lenders shall
be required if, after giving effect to any such post-petition financing, the
outstanding principal amount of the Senior Obligations exceed the Maximum Senior
Principal Amount. No objection will be raised by the
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Subordinated Term Loan D Lenders to the Senior Lenders' motion for relief from
the automatic stay in any proceeding under the Bankruptcy Code to, exercise
rights or remedies with respect to, foreclose on, and/or sell the Collateral.
(f) Any term, covenant, agreement or condition of the
Subordinated Term Loan D Note may, with the consent of the Parent and the
Required Lenders, be amended or compliance therewith may be waived (either
generally or in a particular instance and either retroactively or
prospectively), if the Subordinated Term Loan D Lenders holding at least 66-2/3%
in aggregate principal amount of the outstanding Subordinated Term Loan D (the
"Required Subordinated Loans") consents in writing; provided, however, that
without the written consent of all of the Subordinated Term Loan D Lenders and
the Required Lenders, no such amendment or waiver shall be effective which will
change (i) the time of payment of the principal of or the interest on the
Subordinated Term Loan D or change the principal amount thereof or change the
rate of interest thereon or (ii) the percentage of Subordinated Term Loan D
Lenders required to consent to any such amendment or waiver of any of the
provisions set forth in this Section.
(g) Any amendment or waiver described in Section 12.02(c)
and Section 12.02(d) shall apply equally to all of the Subordinated Term Loan D
Lenders and shall be binding upon them, upon each future Subordinated Term Loan
D Lender and upon the Parent, whether or not any Subordinated Term Loan D Note
shall have been marked to indicate such amendment or waiver. No such amendment
or waiver shall extend to or affect any obligation not expressly amended or
waived or impair any right consequent thereon.
(h) Notwithstanding anything to the contrary, if there is
an amendment, restatement, modification, renewal, refunding, refinancing or
other replacement of the Senior Obligations or this Agreement and the other Loan
Documents, such amendment, restatement, modification, renewal, refunding,
refinancing or other replacement shall not constitute a satisfaction or payment
in full of the Senior Obligations hereunder or a termination of this Agreement
and the other Loan Documents and the Senior Obligations shall be deemed to
remain outstanding and each of the Subordinated Term Loan D Lenders agrees to
enter into with any successor Senior Lenders that amends, restates, modifies,
renews, refunds, refinances or otherwise replaces the Senior Obligations, an
intercreditor and subordination agreement or arrangement on the same terms and
with the same priorities set forth in this Agreement and Annex 3.
Section 12.03 No Waiver; Remedies, Etc. No failure on the part of any
Agent or any Senior Lender to exercise, and no delay in exercising, any right
hereunder or under any other Loan Document shall operate as a waiver thereof;
nor shall any single or partial exercise of any right under any Loan Document
preclude any other or further exercise thereof or the exercise of any other
right. The rights and remedies of the Agents and the Senior Lenders provided
herein and in the other Loan Documents are cumulative and are in addition to,
and not exclusive of, any rights or remedies provided by law. The rights of the
Agents and the Senior Lenders under any Loan Document against any party thereto
are not conditional or contingent on any attempt by the Agents and the Senior
Lenders to exercise any of their rights under any other Loan Document against
such party or against any other Person.
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Section 12.04 Expenses; Taxes; Attorneys' Fees. The Borrowers will pay
on demand, all costs and expenses incurred by or on behalf of each Agent (and,
in the case of clauses (c) through (m) below, each Lender), regardless of
whether the transactions contemplated hereby are consummated, including, without
limitation, reasonable fees, costs, client charges and expenses of counsel for
each Agent (and, in the case of clauses (c) through (m) below, each Lender),
accounting, due diligence, periodic field audits, physical counts, valuations,
investigations, searches and filings, monitoring of assets, appraisals of
Collateral, title searches and reviewing environmental assessments,
miscellaneous disbursements, examination, travel, lodging and meals, arising
from or relating to: (a) the negotiation, preparation, execution, delivery,
performance and administration of this Agreement and the other Loan Documents
(including, without limitation, the preparation of any additional Loan Documents
pursuant to Section 7.01(b) or the review of any of the agreements, instruments
and documents referred to in Section 7.01(f)), (b) any requested amendments,
waivers or consents to this Agreement or the other Loan Documents whether or not
such documents become effective or are given, (c) the preservation and
protection of any of the Lenders' rights under this Agreement or the other Loan
Documents, (d) the defense of any claim or action asserted or brought against
any Agent or any Senior Lender by any Person that arises from or relates to this
Agreement, any other Loan Document, the Agents' or the Senior Lenders' claims
against any Loan Party, or any and all matters in connection therewith, (e) the
commencement or defense of, or intervention in, any court proceeding arising
from or related to this Agreement or any other Loan Document, (f) the filing of
any petition, complaint, answer, motion or other pleading by any Agent or any
Lender, or the taking of any action in respect of the Collateral or other
security, in connection with this Agreement or any other Loan Document, (g) the
protection, collection, lease, sale, taking possession of or liquidation of, any
Collateral or other security in connection with this Agreement or any other Loan
Document, (h) any attempt to enforce any Lien or security interest in any
Collateral or other security in connection with this Agreement or any other Loan
Document, (i) any attempt to collect from any Loan Party, (j) the receipt by any
Agent or any Senior Lender of any advice from professionals with respect to any
of the foregoing, (k) all liabilities and costs arising from or in connection
with the past, present or future operations of any Loan Party involving any
damage to real or personal property or natural resources or harm or injury
alleged to have resulted from any Release of Hazardous Materials on, upon or
into such property, (l) any Environmental Liabilities and Costs incurred in
connection with the investigation, removal, cleanup and/or remediation of any
Hazardous Materials present or arising out of the operations of any facility of
any Loan Party, or (m) any Environmental Liabilities and Costs incurred in
connection with any Environmental Lien. Without limitation of the foregoing or
any other provision of any Loan Document: (x) the Borrowers agree to pay all
stamp, document, transfer, recording or filing taxes or fees and similar
impositions now or hereafter determined by any Agent or any Lender to be payable
in connection with this Agreement or any other Loan Document, and the Borrowers
agree to save each Agent and each Lender harmless from and against any and all
present or future claims, liabilities or losses with respect to or resulting
from any omission to pay or delay in paying any such taxes, fees or impositions,
(y) the Borrowers agree to pay all broker fees that may become due in connection
with the transactions contemplated by this Agreement and the other Loan
Documents, and (z) if the Borrowers fail to perform any covenant or agreement
contained herein or in any other Loan Document, any Agent may itself perform or
cause performance of such covenant or agreement, and the expenses of such Agent
incurred in connection therewith shall be reimbursed on demand by the Borrowers.
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Section 12.05 Right of Set-off. Upon the occurrence and during the
continuance of any Event of Default, any Agent or any Senior Lender may, and is
hereby authorized to, at any time and from time to time, without notice to any
Borrower (any such notice being expressly waived by the Borrowers) and to the
fullest extent permitted by law, set off and apply any and all deposits (general
or special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by such Agent or such Senior Lender to or for the
credit or the account of any Borrower against any and all obligations of the
Borrowers either now or hereafter existing under any Loan Document, irrespective
of whether or not such Agent or such Senior Lender shall have made any demand
hereunder or thereunder and although such obligations may be contingent or
unmatured. Each of the Agents and the Senior Lenders agrees to notify the
Borrowers promptly after any such set-off and application made by such Senior
Lender provided that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of the Agents and the
Senior Lenders under this Section 12.05 are in addition to the other rights and
remedies (including other rights of set-off) which the Agents and the Senior
Lenders may have under this Agreement or any other Loan Documents in law or
otherwise.
Section 12.06 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining portions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
Section 12.07 Assignments and Participations. (a) This Agreement and
the other Loan Documents shall be binding upon and inure to the benefit of each
Loan Party and each Agent and each Senior Lender and their respective successors
and assigns; provided, however, that none of the Loan Parties may assign or
transfer any of its rights hereunder without the prior written consent of each
Senior Lender and any such assignment without the Senior Lenders' prior written
consent shall be null and void.
(b) Each Senior Lender may, (x) with the written consent
of the Collateral Agent, assign to one or more other lenders or other entities
all or a portion of its rights and obligations under this Agreement with respect
to all or a portion of its Senior Term Loan Commitments and the Senior Term
Loans made by it and (y) with the written consent of the Collateral Agent and
the Administrative Agent, assign to one or more other lenders or other entities
all or a portion of its rights and obligations under this Agreement with respect
to all or a portion of its Revolving Credit Commitments, the Revolving Loans
made by it and its Pro Rata Share of Letter of Credit Obligations); provided,
however, that, in either case (i) such assignment is in an amount which is at
least $5,000,000 or a multiple of $1,000,000 in excess thereof (or the remainder
of such Senior Lender's Commitment) (except such minimum amount shall not apply
to any Affiliate of a Lender or a fund or account managed by a Lender), (ii) the
assignee agrees to be bound by the terms of the agreement among Lenders referred
to in Section 11.02(b), (iii) the parties to each such assignment shall execute
and deliver to the Collateral Agent, for its acceptance, an Assignment and
Acceptance, together with any promissory note subject to such assignment and
such parties shall deliver to the Collateral Agent a processing and recordation
fee of $5,000 (except the payment of such fee shall not be required if the
assignee is an Affiliate of a Lender or a fund or account managed by a Lender)
and (iv) no written consent of the Collateral Agent or the Administrative Agent
shall be required in connection with any assignment by a Lender to an Affiliate
of a Lender or a fund or account managed by a Lender. Upon such
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execution, delivery and acceptance, from and after the effective date specified
in each Assignment and Acceptance, which effective date shall be at least three
Business Days after the delivery thereof to the Collateral Agent (or such
shorter period as shall be agreed to by the Collateral Agent and the parties to
such assignment), (A) the assignee thereunder shall become a "Lender" hereunder
and, in addition to the rights and obligations hereunder held by it immediately
prior to such effective date, have the rights and obligations hereunder that
have been assigned to it pursuant to such Assignment and Acceptance and (B) the
assigning Senior Lender thereunder shall, to the extent that rights and
obligations hereunder have been assigned by it pursuant to such Assignment and
Acceptance, relinquish its rights and be released from its obligations under
this Agreement (and, in the case of an Assignment and Acceptance covering all or
the remaining portion of an assigning Senior Lender's rights and obligations
under this Agreement, such Senior Lender shall cease to be a party hereto).
(i) By executing and delivering an Assignment
and Acceptance, the assigning Senior Lender and the assignee thereunder confirm
to and agree with each other and the other parties hereto as follows: (A) other
than as provided in such Assignment and Acceptance, the assigning Senior Lender
makes no representation or warranty and assumes no responsibility with respect
to any statements, warranties or representations made in or in connection with
this Agreement or any other Loan Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any other
Loan Document furnished pursuant hereto; (B) the assigning Senior Lender makes
no representation or warranty and assumes no responsibility with respect to the
financial condition of any Loan Party or any of its Subsidiaries or the
performance or observance by any Loan Party of any of its obligations under this
Agreement or any other Loan Document furnished pursuant hereto; (C) such
assignee confirms that it has received a copy of this Agreement and the other
Loan Documents, together with such other documents and information it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (D) such assignee will, independently and without
reliance upon the assigning Senior Lender, any Agent or any Senior Lender and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Agreement and the other Loan Documents; (E) such assignee appoints
and authorizes the Agents to take such action as agents on its behalf and to
exercise such powers under this Agreement and the other Loan Documents as are
delegated to the Agents by the terms hereof and thereof, together with such
powers as are reasonably incidental hereto and thereto; and (F) such assignee
agrees that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement and the other Loan Documents
are required to be performed by it as a Lender.
(ii) The Borrowers authorize the Administrative
Agent, and the Administrative Agent agrees, to maintain, or cause to be
maintained at the Payment Office, a copy of each Assignment and Acceptance
delivered to and accepted by it and a register (the "Register") for the
recordation of the names and addresses of the Senior Lenders and the Commitments
of, and principal amount of the Senior Loans (the "Registered Loans") and Letter
of Credit Obligations owing to each Senior Lender from time to time. The entries
in the Register shall be conclusive and binding for all purposes, absent
manifest error, and the Borrowers, the Agents and the Senior Lenders shall treat
each Person whose name is recorded in the Register as a Senior Lender hereunder
for all purposes of this Agreement. The Register shall be available
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for inspection by the Administrative Borrower, any Senior Lender and the
Collateral Agent at any reasonable time and from time to time upon reasonable
prior notice.
(iii) Upon receipt by the Administrative Agent of
an Assignment and Acceptance executed by an assigning Senior Lender and an
assignee, together with any promissory notes subject to such assignment, the
Collateral Agent shall, if the Collateral Agent consents to such assignment and
if such Assignment and Acceptance has been completed, accept such Assignment and
Acceptance and the Administrative Agent shall record the information contained
therein in the Register.
(iv) A Registered Loan (and the registered note,
if any, evidencing the same) may be assigned or sold in whole or in part only by
registration of such assignment or sale on the Register (and each registered
note shall expressly so provide). Any assignment or sale of all or part of such
Registered Loan (and the registered note, if any, evidencing the same) may be
effected only by registration of such assignment or sale on the Register,
together with the surrender of the registered note, if any, evidencing the same
duly endorsed by (or accompanied by a written instrument of assignment or sale
duly executed by) the holder of such registered note, whereupon, at the request
of the designated assignee(s) or transferee(s), one or more new registered notes
in the same aggregate principal amount shall be issued to the designated
assignee(s) or transferee(s). Prior to the registration of assignment or sale of
any Registered Loan (and the registered note, if any, evidencing the same), the
Agents shall treat the Person in whose name such Registered Loan (and the
registered note, if any, evidencing the same) is registered as the owner thereof
for the purpose of receiving all payments thereon and for all other purposes,
notwithstanding notice to the contrary.
(v) In the event that any Senior Lender sells
participations in a Registered Loan, such Senior Lender shall maintain a
register on which it enters the name of all participants in the Registered Loans
held by it (the "Participant Register"). A Registered Loan (and the registered
note, if any, evidencing the same) may be participated in whole or in part only
by registration of such participation on the Participant Register (and each
registered note shall expressly so provide). Any participation of such
Registered Loan (and the registered note, if any, evidencing the same) may be
effected only by the registration of such participation on the Participant
Register.
(vi) Any foreign Person who purchases or is
assigned or participates in any portion of such Registered Loan shall provide
the Agents and the Senior Lender with a completed Internal Revenue Service Form
W-8BEN (Certificate of Foreign Status) or a substantially similar form for such
purchaser, participant or any other affiliate who is a holder of beneficial
interests in the Registered Loan.
(c) Each Senior Lender may sell participations to one or
more banks or other entities in or to all or a portion of its rights and
obligations under this Agreement and the other Loan Documents (including,
without limitation, all or a portion of its Commitments, the Senior Loans made
by it and its Pro Rata Share of the Letter of Credit Obligations); provided,
that (i) such Senior Lender's obligations under this Agreement (including
without limitation, its Commitments hereunder) and the other Loan Documents
shall remain unchanged; (ii) such Senior Lender shall remain solely responsible
to the other parties hereto for the performance of
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such obligations, and the Borrowers, the Agents and the other Senior Lenders
shall continue to deal solely and directly with such Senior Lender in connection
with such Senior Lender's rights and obligations under this Agreement and the
other Loan Documents; and (iii) a participant shall not be entitled to require
such Senior Lender to take or omit to take any action hereunder except (A)
action directly effecting an extension of the maturity dates or decrease in the
principal amount of the Senior Loans or Letter of Credit Obligations, (B) action
directly effecting an extension of the due dates or a decrease in the rate of
interest payable on the Senior Loans or the fees payable under this Agreement,
or (C) actions directly effecting a release of all or a substantial portion of
the Collateral or any Borrower or any Guarantor (except as set forth in Section
10.08 of this Agreement or any other Loan Document).
(d) This Agreement and the other Loan Documents shall be
binding upon and inure to the benefit of each Subordinated Term Loan D and each
of its successors and assigns. Each Subordinated Term Loan D Lender may transfer
and assign to one or more other Persons the Subordinated Term Loan D Notes
pursuant to the terms and provisions set forth in Annex 5.
Section 12.08 Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which shall be deemed to be an original, but all of which taken together
shall constitute one and the same agreement. Delivery of an executed counterpart
of this Agreement by telecopier shall be equally as effective as delivery of an
original executed counterpart of this Agreement. Any party delivering an
executed counterpart of this Agreement by telecopier also shall deliver an
original executed counterpart of this Agreement but the failure to deliver an
original executed counterpart shall not affect the validity, enforceability, and
binding effect of this Agreement. The foregoing shall apply to each other Loan
Document mutatis mutandis.
Section 12.09 GOVERNING LAW. THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS (UNLESS EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER LOAN DOCUMENT IN
RESPECT OF SUCH OTHER LOAN DOCUMENT) SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE
AND TO BE PERFORMED IN THE STATE OF NEW YORK.
Section 12.10 CONSENT TO JURISDICTION; SERVICE OF PROCESS AND VENUE.
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 IN THE COUNTY OF
NEW YORK OR OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW
YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH LOAN PARTY HEREBY
IRREVOCABLY ACCEPTS IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY,
THE JURISDICTION OF THE AFORESAID COURTS. EACH LOAN PARTY HEREBY IRREVOCABLY
APPOINTS THE SECRETARY OF STATE OF THE STATE OF NEW YORK AS ITS AGENT FOR
SERVICE OF PROCESS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING AND FURTHER
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED
COURTS AND IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY
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REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE ADMINISTRATIVE BORROWER AT
ITS ADDRESS FOR NOTICES AS SET FORTH IN SECTION 12.01 AND TO THE SECRETARY OF
STATE OF THE STATE OF NEW YORK, SUCH SERVICE TO BECOME EFFECTIVE TEN (10) DAYS
AFTER SUCH MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE AGENTS AND THE
LENDERS TO SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO
COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY LOAN PARTY IN ANY
OTHER JURISDICTION. EACH LOAN PARTY HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE JURISDICTION OR LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN
ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT ANY LOAN PARTY HAS OR
HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY
LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS
PROPERTY, EACH LOAN PARTY HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF
ITS OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
Section 12.11 WAIVER OF JURY TRIAL, ETC. EACH LOAN PARTY, EACH AGENT
AND EACH LENDER HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM CONCERNING ANY RIGHTS UNDER THIS AGREEMENT OR THE
OTHER LOAN DOCUMENTS, OR UNDER ANY AMENDMENT, WAIVER, CONSENT, INSTRUMENT,
DOCUMENT OR OTHER AGREEMENT DELIVERED OR WHICH IN THE FUTURE MAY BE DELIVERED IN
CONNECTION THEREWITH, OR ARISING FROM ANY FINANCING RELATIONSHIP EXISTING IN
CONNECTION WITH THIS AGREEMENT, AND AGREES THAT ANY SUCH ACTION, PROCEEDINGS OR
COUNTERCLAIM SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY. EACH LOAN
PARTY CERTIFIES THAT NO OFFICER, REPRESENTATIVE, AGENT OR ATTORNEY OF ANY AGENT
OR ANY LENDER HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT ANY AGENT OR ANY
LENDER WOULD NOT, IN THE EVENT OF ANY ACTION, PROCEEDING OR COUNTERCLAIM, SEEK
TO ENFORCE THE FOREGOING WAIVERS. EACH LOAN PARTY HEREBY ACKNOWLEDGES THAT THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE AGENTS AND THE LENDERS ENTERING INTO
THIS AGREEMENT.
Section 12.12 Consent by the Agents and Lenders. Except as otherwise
expressly set forth herein to the contrary, if the consent, approval,
satisfaction, determination, judgment, acceptance or similar action (an
"Action") of any Agent or any Senior Lender shall be permitted or required
pursuant to any provision hereof or any provision of any other agreement to
which any Loan Party is a party and to which any Agent or any Senior Lender has
succeeded thereto, such Action shall be required to be in writing and may be
withheld or denied by such Agent or such Senior Lender, in its sole discretion,
with or without any reason, and without being subject to question or challenge
on the grounds that such Action was not taken in good faith.
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Section 12.13 No Party Deemed Drafter. Each of the parties hereto
agrees that no party hereto shall be deemed to be the drafter of this Agreement.
Section 12.14 Reinstatement; Certain Payments. If any claim is ever
made upon any Agent, any Senior Lender or the L/C Issuer for repayment or
recovery of any amount or amounts received by such Agent, such Senior Lender or
the L/C Issuer in payment or on account of any of the Obligations, such Agent,
such Senior Lender or the L/C Issuer shall give prompt notice of such claim to
each other Agent and Lender and the Administrative Borrower, and if such Agent,
such Senior Lender or the L/C Issuer repays all or part of such amount by reason
of (i) any judgment, decree or order of any court or administrative body having
jurisdiction over such Agent, such Senior Lender or the L/C Issuer or any of its
property, or (ii) any good faith settlement or compromise of any such claim
effected by such Agent, such Senior Lender or the L/C Issuer with any such
claimant, then and in such event each Loan Party agrees that (A) any such
judgment, decree, order, settlement or compromise shall be binding upon it
notwithstanding the cancellation of any Indebtedness hereunder or under the
other Loan Documents or the termination of this Agreement or the other Loan
Documents, and (B) it shall be and remain liable to such Agent, such Senior
Lender or the L/C Issuer hereunder for the amount so repaid or recovered to the
same extent as if such amount had never originally been received by such Agent,
such Senior Lender or the L/C Issuer.
Section 12.15 Indemnification. In addition to each Loan Party's other
Obligations under this Agreement, each Loan Party agrees to, jointly and
severally, defend, protect, indemnify and hold harmless each Indemnitee from and
against any and all losses, damages, liabilities, obligations, penalties, fees,
reasonable costs and expenses (including, without limitation, reasonable
attorneys' fees, costs and expenses) incurred by such Indemnitees, whether prior
to or from and after the Effective Date, whether direct, indirect or
consequential, as a result of or arising from or relating to or in connection
with any of the following: (i) the negotiation, preparation, execution or
performance or enforcement of this Agreement, any other Loan Document or of any
other document executed in connection with the transactions contemplated by this
Agreement, (ii) any Agent's or any Lender's furnishing of funds to the Borrowers
or the L/C Issuer's issuing of Letters of Credit for the account of the
Borrowers under this Agreement or the other Loan Documents, including, without
limitation, the management of any such Loans, the Reimbursement Obligations or
the Letter of Credit Obligations, (iii) any matter relating to any of the
financing transactions contemplated by this Agreement, any of the other Loan
Documents, any of the Collateral (including, without limitation, in connection
with the Rolling Stock or the titling or registration thereof) or any document
executed in connection with the transactions contemplated by this Agreement or
the other Loan Documents, or (iv) any claim, litigation, investigation or
proceeding relating to any of the foregoing, whether or not any Indemnitee is a
party thereto (collectively, the "Indemnified Matters"); provided, however, that
the Loan Parties shall not have any obligation to any Indemnitee under this
Section 12.15 for any Indemnified Matter caused by the gross negligence or
willful misconduct of such Indemnitee, as determined by a final judgment of a
court of competent jurisdiction. Such indemnification for all of the foregoing
losses, damages, fees, costs and expenses of the Indemnitees are chargeable
against the Loan Account. To the extent that the undertaking to indemnify, pay
and hold harmless set forth in this Section 12.15 may be unenforceable because
it is violative of any law or public policy, each Loan Party shall, jointly and
severally, contribute the maximum portion which it is permitted to pay and
satisfy under applicable law, to the payment and satisfaction of all Indemnified
Matters incurred by the
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Indemnitees. This Indemnity shall survive the repayment of the Obligations and
the discharge of the Liens granted under the Loan Documents.
Section 12.16 The Parent as Agent for the Borrowers. Allied Systems
hereby irrevocably appoints the Parent as the borrowing agent and
attorney-in-fact for the Borrowers (the "Administrative Borrower") with respect
to the Senior Loans which appointment shall remain in full force and effect
unless and until the Agents shall have received prior written notice signed by
all of the Borrowers that such appointment has been revoked and that another
Borrower has been appointed Administrative Borrower. Each Borrower hereby
irrevocably appoints and authorizes the Administrative Borrower (i) to provide
to the Agents and receive from the Agents all notices with respect to Loans
obtained for the benefit of any Borrower and all other notices and instructions
under this Agreement and (ii) to take such action as the Administrative Borrower
deems appropriate on its behalf to obtain Loans and to exercise such other
powers as are reasonably incidental thereto to carry out the purposes of this
Agreement. It is understood that the handling of the Loan Account and Collateral
of the Borrowers in a combined fashion, as more fully set forth herein, is done
solely as an accommodation to the Borrowers in order to utilize the collective
borrowing powers of the Borrowers in the most efficient and economical manner
and at their request, and that neither the Agents nor the Senior Lenders shall
incur liability to the Borrowers as a result hereof. Each of the Borrowers
expects to derive benefit, directly or indirectly, from the handling of the Loan
Account and the Collateral in a combined fashion since the successful operation
of each Borrower is dependent on the continued successful performance of the
integrated group. To induce the Agents and the Lenders to do so, and in
consideration thereof, each of the Borrowers hereby jointly and severally agrees
to indemnify the Indemnitees and hold the Indemnitees harmless against any and
all liability, expense, loss or claim of damage or injury, made against such
Indemnitee by any of the Borrowers or by any third party whosoever, arising from
or incurred by reason of (a) the handling of the Loan Account and Collateral of
the Borrowers as herein provided, (b) the Agents and the Senior Lenders relying
on any instructions of the Administrative Borrower, or (c) any other action
taken by any Agent or any Senior Lender hereunder or under the other Loan
Documents.
Section 12.17 Records. The unpaid principal of and interest on the
Loans, the interest rate or rates applicable to such unpaid principal and
interest, the duration of such applicability, the Commitments, and the accrued
and unpaid fees payable pursuant to Section 2.06 hereof, including, without
limitation, the Unused Line Fee, the Letter of Credit Fee, the Term Loan C Fee
and fees set forth in the Fee Letter, shall at all times be ascertained from the
records of the Agents, which shall be prima facie evidence of the matters
therein, subject to the right of the Loan Parties to review such records as
provided in Section 4.02(b).
Section 12.18 Binding Effect. This Agreement shall become effective
when it shall have been executed by each Loan Party, each Agent and each Lender
and when the conditions precedent set forth in Section 5.01 and Section 5.03
have been satisfied or waived in writing by the Agents, and thereafter shall be
binding upon and inure to the benefit of each Loan Party, each Agent and each
Lender, and their respective successors and assigns, except that the Loan
Parties shall not have the right to assign their rights hereunder or any
interest herein without the prior written consent of each Senior Lender, and any
assignment by any Senior Lender shall be governed by Section 12.07 hereof.
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Section 12.19 Interest. It is the intention of the parties hereto that
each Agent and each Lender shall conform strictly to usury laws applicable to
it. Accordingly, if the transactions contemplated hereby or by any other Loan
Document would be usurious as to any Agent or any Lender under laws applicable
to it (including the laws of the United States of America and the State of New
York or any other jurisdiction whose laws may be mandatorily applicable to such
Agent or such Lender notwithstanding the other provisions of this Agreement),
then, in that event, notwithstanding anything to the contrary in this Agreement
or any other Loan Document or any agreement entered into in connection with or
as security for the Obligations, it is agreed as follows: (i) the aggregate of
all consideration which constitutes interest under law applicable to any Agent
or any Lender that is contracted for, taken, reserved, charged or received by
such Agent or such Lender under this Agreement or any other Loan Document or
agreements or otherwise in connection with the Obligations shall under no
circumstances exceed the maximum amount allowed by such applicable law, any
excess shall be canceled automatically and if theretofore paid shall be credited
by such Agent or such Lender on the principal amount of the Obligations (or, to
the extent that the principal amount of the Obligations shall have been or would
thereby be paid in full, refunded by such Agent or such Lender, as applicable,
to the Borrowers); and (ii) in the event that the maturity of the Obligations is
accelerated by reason of any Event of Default under this Agreement or otherwise,
or in the event of any required or permitted prepayment, then such consideration
that constitutes interest under law applicable to any Agent or any Lender may
never include more than the maximum amount allowed by such applicable law, and
excess interest, if any, provided for in this Agreement or otherwise shall be
canceled automatically by such Agent or such Lender, as applicable, as of the
date of such acceleration or prepayment and, if theretofore paid, shall be
credited by such Agent or such Lender, as applicable, on the principal amount of
the Obligations (or, to the extent that the principal amount of the Obligations
shall have been or would thereby be paid in full, refunded by such Agent or such
Lender to the Borrowers). All sums paid or agreed to be paid to any Agent or any
Lender for the use, forbearance or detention of sums due hereunder shall, to the
extent permitted by law applicable to such Agent or such Lender, be amortized,
prorated, allocated and spread throughout the full term of the Loans until
payment in full so that the rate or amount of interest on account of any Loans
hereunder does not exceed the maximum amount allowed by such applicable law. If
at an time and from time to time (x) the amount of interest payable to any Agent
or any Lender on any date shall be computed at the Highest Lawful Rate
applicable to such Agent or such Lender pursuant to this Section 12.19 and (y)
in respect of any subsequent interest computation period the amount of interest
otherwise payable to such Agent or such Lender would be less than the amount of
interest payable to such Agent or such Lender computed at the Highest Lawful
Rate applicable to such Agent or such Lender, then the amount of interest
payable to such Agent or such Lender in respect of such subsequent interest
computation period shall continue to be computed at the Highest Lawful Rate
applicable to such Agent or such Lender until the total amount of interest
payable to such Agent or such Lender shall equal the total amount of interest
which would have been payable to such Agent or such Lender if the total amount
of interest had been computed without giving effect to this Section 12.19.
For purposes of this Section 12.19, the term "applicable law" shall
mean that law in effect from time to time and applicable to the loan transaction
between the Borrowers, on the one hand, and the Agents and the Lenders, on the
other, that lawfully permits the charging and collection of the highest
permissible, lawful non-usurious rate of interest on such loan transaction
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and this Agreement, including laws of the State of New York and, to the extent
controlling, laws of the United States of America.
The right to accelerate the maturity of the Obligations does not
include the right to accelerate any interest that has not accrued as of the date
of acceleration.
Section 12.20 Defaulting Lender. (a) Notwithstanding anything to the
contrary contained herein, in the event that any Lender (x) refuses (which
refusal constitutes a breach by such Lender of its obligations under this
Agreement and which has not been retracted) to make available its portion of any
Revolving Loan, (y) notifies the Agent and/or the Borrowers that it does not
intend to make available its portion of any Revolving Loan or (z) fails to
satisfy its indemnification obligations under Section 10.05 or any other similar
provision in the Loan Documents (each, a "Lender Default"), all rights and
obligations hereunder of the Lender (a "Defaulting Lender") as to which a Lender
Default is in effect and of the other parties hereto shall be modified by this
Section 12.20 while such Lender Default remains in effect.
(b) Revolving Loans shall be incurred pro rata from the
Senior Lenders (the "Non-Defaulting Lenders") which are not Defaulting Lenders
based on their respective Revolving Credit Commitments, and no Revolving Credit
Commitment shall be increased as a result of such Lender Default.
(c) Amounts received in respect of principal of the Loans
shall be applied to reduce the Loans of each of the Lenders pro rata based on
the aggregate of the outstanding Loans of all of the Lenders at the time of such
application; provided that, such amount shall not be applied to any Loan of a
Defaulting Lender at any time when, and to the extent that, the aggregate amount
of Loans of any Non-Defaulting Lender exceeds such Non-Defaulting Lenders' Pro
Rata Share of all Loans then outstanding.
(d) The Non-Defaulting Lenders (that are Revolving Loan
Lenders) shall participate in Letters of Credit on the basis of their respective
Pro Rata Shares, determined, however, as if the Revolving Credit Commitment of a
Defaulting Lender is zero, and shall receive Letter of Credit Fees on such
basis. A Defaulting Lender shall not be entitled to receive any portion of the
Unused Line Fees, the Letter of Credit Fees or any other fees or any indemnity
arising from its Commitment.
(e) A Defaulting Lender shall not be entitled to give
instructions to the Agents or to approve, disapprove, consent to or vote on any
matters relating to this Agreement and the other Loan Documents. All amendments,
waivers and other modifications of this Agreement and the other Loan Documents
may be made without regard to a Defaulting Lender and, for purposes of the
definition of "Required Lenders", "Required Revolving Lenders", or "Required
Subordinated Lenders", a Defaulting Lender shall be deemed not to be a Lender,
not to have any Commitment and not to have Loans outstanding.
(f) Other than as expressly set forth in this Section
12.20, the rights and obligations of a Defaulting Lender (including the
obligation to indemnify the Agents) and the other parties hereto shall remain
unchanged. Nothing in this Section 12.20 shall be deemed to release any
Defaulting Lender from any of its Commitment hereunder, shall alter such
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Commitment, shall operate as a waiver of any default by such Defaulting Lender
hereunder, or shall prejudice any rights which the Borrowers, the Agents or any
Lender may have against any Defaulting Lender as a result of any default by such
Defaulting Lender hereunder.
Section 12.21 Confidentiality. Each Agent and each Lender agrees (on
behalf of itself and each of its affiliates, directors, officers, employees and
representatives) to use reasonable precautions to keep confidential, in
accordance with its customary procedures for handling confidential information
of this nature and in accordance with safe and sound practices of comparable
commercial finance companies, any non-public information supplied to it by the
Loan Parties pursuant to this Agreement or the other Loan Documents which is
identified in writing by the Loan Parties as being confidential at the time the
same is delivered to such Person (and which at the time is not, and does not
thereafter become, publicly available or available to such Person from another
source not known to be subject to a confidentiality obligation to such Person
not to disclose such information), provided that nothing herein shall limit the
disclosure of any such information (i) to the extent required by statute, rule,
regulation or judicial process, any regulatory body having jurisdiction over any
Lender, (ii) to counsel for any Agent or any Lender, (iii) to examiners,
auditors, accountants or Securitization Parties, other financial or professional
advisers or the National Association of Insurance Commissioners, (iv) in
connection with any litigation to which any Agent or any Lender is a party or
(v) to any assignee, participant or transferee (or prospective assignee or
participant) so long as such assignee or participant (or prospective assignee,
participant or transferee) first agrees, in writing, to be bound by
confidentiality provisions similar in substance to this Section 12.21. Each
Agent and each Lender agrees that, upon receipt of a request or identification
of the requirement for disclosure pursuant to clause (iv) hereof, it will make
reasonable efforts to keep the Loan Parties informed of such request or
identification; provided that the each Loan Party acknowledges that each Agent
and each Lender may make disclosure as required or requested by any Governmental
Authority or representative thereof and that each Agent and each Lender may be
subject to review by Securitization Parties or other regulatory agencies and may
be required to provide to, or otherwise make available for review by, the
representatives of such parties or agencies any such non-public information.
Section 12.22 Integration. This Agreement, together with the other Loan
Documents, reflects the entire understanding of the parties with respect to the
transactions contemplated hereby and shall not be contradicted or qualified by
any other agreement, oral or written, before the date hereof.
ARTICLE XIII
SUBORDINATED TERM LOAN D PROVISIONS
Section 13.01 Purchase of the Subordinated Notes. Subject to the terms
and conditions of this Agreement and in reliance upon the representations,
warranties, covenants and agreements of the Parent contained herein, on the
Effective Date the Subordinated Term Loan D Lenders shall sell, assign,
transfer, convey and deliver to the Parent, and the Parent shall purchase from
the Subordinated Term Loan D Lenders, the Subordinated Notes.
Section 13.02 Consideration. Subject to the terms and conditions of
this Agreement, the aggregate purchase price for the Subordinated Notes shall
equal the following:
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(a) $8,000,000 in cash payable on February 26, 2002;
(b) $750,000, plus PIK interest accruing from and
including February 1, 2002 to but not including February 26, 2002, payable in
cash on February 26, 2002;
(c) $2,400,000, plus cash interest accruing from and
including February 1, 2002, to but not including February 26, 2002, payable in
cash on February 26, 2002; and
(d) $29,250,000, aggregate principal amount of the
Subordinated Term Loan D Notes issued pursuant hereto.
(e) Such consideration shall be payable to the Holders on
a pro rata basis according to the following percentages: (x) 50% to John Hancock
Life Insurance Company and (y) 50% to The Northwestern Mutual Life Insurance
Company.
Section 13.03 Annexes Relating to Subordinated Term Loan D Notes.
Except as otherwise expressly provided in this Agreement, the provisions of
Annexes 1, 2, 3, 4 and 5 shall govern the terms and conditions relating to the
Subordinated Term Loan D Notes.
Section 13.04 Representation and Warranty Regarding Subordinated Note.
John Hancock Life Insurance Company represents and warrants that it is the legal
and beneficial owner of the Subordinated Notes, numbered R-6 and R-4, in the
principal face amount of $20,062,083.34 (which includes $62,083.34 of PIK
interest added to the original principal face amount of the Subordinated Note,
numbered R-6) free and clear of Liens. The Northwestern Mutual Life Insurance
Company represents and warrants that it is the legal and beneficial owner of the
Subordinated Note, numbered R-3, in the principal face amount of $20,000,000
(which excludes PIK interest added to such original principal face amount of
such Subordinated Note) free and clear of Liens.
Section 13.05 Termination of Subordinated Note Agreement. Effective as
of the Effective Date, the provisions of the Subordinated Note Agreement shall
terminate and no longer be of any force and effect.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
BORROWERS:
ALLIED HOLDINGS, INC.
By:
-------------------------------------
Name:
Title:
ALLIED SYSTEMS, LTD. (L.P.)
By:
-------------------------------------
Name:
Title:
GUARANTORS:
ALLIED AUTOMOTIVE GROUP, INC.
By:
-------------------------------------
Name:
Title:
ALLIED FREIGHT BROKER, INC.
By:
-------------------------------------
Name:
Title:
ALLIED SYSTEMS (CANADA) COMPANY
By:
-------------------------------------
Name:
Title:
AUTOMOTIVE TRANSPORT SERVICES, INC.
By:
-------------------------------------
Name:
Title:
AXIS ARETA, LLC
By:
-------------------------------------
Name:
Title:
AXIS CANADA COMPANY
By:
-------------------------------------
Name:
Title:
AXIS GROUP, INC.
By:
-------------------------------------
Name:
Title:
AXIS INTERNATIONAL, INC.
By:
-------------------------------------
Name:
Title:
AXIS NETHERLANDS, LLC
By:
-------------------------------------
Name:
Title:
AXIS NORTH AMERICA, INC.
By:
-------------------------------------
Name:
Title:
AXIS TRUCK LEASING, INC.
By:
-------------------------------------
Name:
Title:
B&C, INC.
By:
-------------------------------------
Name:
Title:
CANADIAN ACQUISITION CORP.
By:
-------------------------------------
Name:
Title:
COMMERCIAL CARRIERS, INC.
By:
-------------------------------------
Name:
Title:
CORDIN TRANSPORT, INC.
By:
-------------------------------------
Name:
Title:
CT GROUP, INC.
By:
-------------------------------------
Name:
Title:
CT SERVICES, INC.
By:
-------------------------------------
Name:
Title:
F. J. BOUTELL DRIVEAWAY CO., INC.
By:
-------------------------------------
Name:
Title:
GACS INCORPORATED
By:
-------------------------------------
Name:
Title:
INTER MOBILE, INC.
By:
-------------------------------------
Name:
Title:
KAR-TAINER INTERNATIONAL, INC.
By:
-------------------------------------
Name:
Title:
LEGION TRANSPORTATION, INC.
By:
-------------------------------------
Name:
Title:
OSHCO, INC.
By:
-------------------------------------
Name:
Title:
QAT, INC.
By:
-------------------------------------
Name:
Title:
RC MANAGEMENT CORP.
By:
-------------------------------------
Name:
Title:
RMX, INC.
By:
-------------------------------------
Name:
Title:
TERMINAL SERVICE CO.
By:
-------------------------------------
Name:
Title:
TRANSPORT SUPPORT, INC.
By:
-------------------------------------
Name:
Title:
COLLATERAL AGENT AND LENDER:
ABLECO FINANCE LLC
By:
-------------------------------------
Name:
Title:
ADMINISTRATIVE AGENT AND LENDER:
FOOTHILL CAPITAL CORPORATION
By:
-------------------------------------
Name:
Title:
SUBORDINATED TERM LOAN D LENDERS:
JOHN HANCOCK LIFE INSURANCE COMPANY
By:
-------------------------------------
Name:
Title:
THE NORTHWESTERN MUTUAL LIFE INSURANCE
COMPANY
By:
-------------------------------------
Name:
Title:
ANNEX 1
COVENANTS
Section 1.1 Reports. (a) Whether or not required by the rules
and regulations of the SEC, so long as any Subordinated Term Loan D Notes are
outstanding, the Parent shall furnish to the Holders (i) all quarterly and
annual financial information that would be required to be contained in a filing
with the SEC on Forms 10-Q and 10-K if the Parent were required to file such
Forms, including a "Management's Discussion and Analysis of Financial Condition
and Results of Operations" that describes the financial condition and results of
operations of the Parent and its consolidated Subsidiaries (showing in
reasonable detail, either on the face of the financial statements or in the
footnotes thereto and in Management's Discussion and Analysis of Financial
Condition and Results of Operations, the financial condition and results of
operations of the Parent and its Restricted Subsidiaries separate from the
financial information and results of operations of the Unrestricted Subsidiaries
of the Parent) and, with respect to the annual information only, a report
thereon by the Parent's certified independent accountants and (ii) all current
reports that would be required to be filed with the SEC on Form 8-K if the
Parent were required to file such reports. In addition, whether or not required
by the rules and regulations of the SEC, the Parent will file a copy of all such
information and reports with the SEC for public availability (unless the SEC
will not accept such a filing) and make such information available to securities
analysts and prospective investors upon request.
(b) For so long as any Subordinated Term Loan D Notes remain
outstanding, the Parent and its Restricted Subsidiaries shall furnish to the
Holders and to securities analysts and prospective investors, upon their
request, the information required to be delivered pursuant to Rule 144A(d)(4)
under the Securities Act.
Section 1.2 Compliance Certificate. (a) The Parent shall deliver
to the Holders, within 90 days after the end of each fiscal year, an Officers'
Certificate stating that a review of the activities of the Parent and its
Subsidiaries during the preceding fiscal year has been made under the
supervision of the signing Officers with a view to determining whether the
Parent has kept, observed, performed and fulfilled its obligations under this
Agreement and the Loan Documents, and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge the Parent
has kept, observed, performed and fulfilled each and every covenant contained in
this Agreement and the Loan Documents and is not in Subordinated Term Loan D
Default in the performance or observance of any of the terms, provisions and
conditions of this Agreement and the Loan Documents (or, if a Subordinated Term
Loan D Default or Subordinated Term Loan D Event of Default shall have occurred,
describing all such Subordinated Term Loan D Defaults or Subordinated Term Loan
D Events of Default of which he or she may have knowledge and what action the
Parent is taking or proposes to
take with respect thereto) and that to the best of his or her knowledge no event
has occurred and remains in existence by reason of which payments on account of
the principal of or interest, if any, on the Subordinated Term Loan D Notes is
prohibited or if such event has occurred, a description of the event and what
action the Parent is taking or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 1.1(a) above shall be accompanied by a
written statement of the Parent's independent public accountants (who shall be a
firm of established national reputation) that in making the examination
necessary for certification of such financial statements, nothing has come to
their attention that would lead them to believe that the Parent has violated any
provisions of this Annex 1 or, if any such violation has occurred, specifying
the nature and period of existence thereof, it being understood that such
accountants shall not be liable directly or indirectly to any Person for any
failure to obtain knowledge of any such violation.
(c) The Parent shall, so long as any of the Subordinated Term Loan D
Notes are outstanding, deliver to the Holders, forthwith upon any Officer
becoming aware of any Subordinated Term Loan D Default or Subordinated Term Loan
D Event of Default, an Officers' Certificate specifying such Subordinated Term
Loan D Default or Subordinated Term Loan D Event of Default and what action the
Parent is taking or proposes to take with respect thereto.
2
Section 1.3 Taxes. The Parent shall pay, and shall cause each of
its Subsidiaries to pay, prior to delinquency, all material taxes, assessments,
and governmental levies except such as are contested in good faith and by
appropriate proceedings or where the failure to effect such payment is not
adverse in any material respect to the Holders.
Section 1.4 Stay, Extension and Usury Laws. The Parent covenants
(to the extent that it may lawfully do so) that it shall not at any time insist
upon, plead, or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Agreement (insofar as it relates to the Holders or the Subordinated Term Loan D
Notes) or the Subordinated Term Loan D Notes; and the Parent (to the extent that
it may lawfully do so) hereby expressly waives all benefit or advantage of any
such law, and covenants that it shall not, by resort to any such law, hinder,
delay or impede the execution of any power herein granted to the Collateral
Agent and/or Holders, but shall suffer and permit the execution of every such
power as though no such law has been enacted.
Section 1.5 Restricted Payments. The Parent shall not, and shall
not permit any of its Restricted Subsidiaries to, (a) declare or pay any
dividend or make any other payment or distribution on account of the Parent's
Equity Interests (including, without limitation, any payment in connection with
any merger or consolidation involving the Parent) or to any direct or indirect
holders of the Parent's Equity Interests in their capacity as such (other than
dividends or distributions (i) payable in Equity Interests (other than
Disqualified Stock) of the Parent or (ii) to the Parent or any Guarantor); (b)
purchase, redeem or otherwise acquire or retire for value (including without
limitation, in connection with any merger or consolidation involving the Parent)
any Equity Interests of the Parent or any direct or indirect parent of the
Parent (other than any such Equity Interests owned by the Parent or any
Guarantor); (c) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value any Indebtedness of the Parent
or any Guarantor that is subordinated to the Subordinated Term Loan D Notes or
any Guaranty thereof, except a payment of interest or principal at Stated
Maturity; or (d) make any Restricted Investment (all such payments and other
actions set forth in clauses (a) through (d) above being collectively referred
to as "Restricted Payments"), unless, at the time of and after giving effect to
such Restricted Payment:
(a) no Subordinated Term Loan D Default or Subordinated Term Loan D
Event of Default shall have occurred and be continuing or would occur as a
consequence thereof;
(b) the Parent would, at the time of such Restricted Payment and after
giving pro forma effect thereto as if such Restricted Payment had been made at
the beginning of the
3
applicable four-quarter period, have been permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Consolidated Interest Coverage Ratio
test set forth in the first paragraph of Annex 1.7 of this Annex; and
(c) such Restricted Payment, together with the aggregate amount of all
other Restricted Payments made by the Parent and its Restricted Subsidiaries
after October 1, 1997 (excluding Restricted Payments permitted by clauses (ii)
through (vii) of the next succeeding paragraph), is less than the sum of (1) 50%
of the Consolidated Net Income of the Parent for the period (taken as one
accounting period) from October 1, 1997 to the end of the Parent's most recently
ended fiscal quarter for which internal financial statements are available at
the time of such Restricted Payment (or, if such Consolidated Net Income for
such period is a deficit, less 100% of such deficit), plus (2) 100% of the
aggregate net proceeds received by the Parent from the issue or sale since
October 1, 1997 of Equity Interests of the Parent (other than Disqualified
Stock), plus (3) the amount by which Indebtedness of the Parent and its
Restricted Subsidiaries is reduced on the balance sheet of the Parent upon the
conversion or exchange (other than by a Restricted Subsidiary of the Parent)
subsequent to October 1, 1997 of any such Indebtedness for Equity Interests
(other than Disqualified Stock) of the Parent, plus (4) to the extent that any
Restricted Investment that was made after October 1, 1997 is or was sold for
cash or otherwise liquidated or repaid for cash, the lesser of (A) the cash
return of capital with respect to such Restricted Investment (less the cost of
disposition, if any) and (B) the initial amount of such Restricted Investment,
plus (5) in the event that any Unrestricted Subsidiary is redesignated as a
Restricted Subsidiary, the lesser of (A) an amount equal to the fair value (as
determined by the Board of Directors) of the Parent's Investments in such
Restricted Subsidiary and (B) the amount of Restricted Investments previously
made by the Parent and its Restricted Subsidiaries in such Unrestricted
Subsidiary.
The foregoing provisions will not prohibit (i) the payment of any
dividend within 60 days after the date of declaration thereof, if at the date of
declaration such payment would have complied with the provisions of this
Agreement; (ii) the redemption, repurchase, retirement, defeasance or other
acquisition of any subordinated Indebtedness or Equity Interests of the Parent
or any Restricted Subsidiary in exchange for, or out of the net cash proceeds of
the substantially concurrent sale (other than to a Subsidiary of the Parent) of,
other Equity Interests of the Parent (other than any Disqualified Stock),
provided that the amount of any such net cash proceeds that are utilized for any
such redemption, repurchase, retirement, defeasance or other acquisition shall
be excluded from clause (c)(2) of the preceding paragraph; (iii) the defeasance,
redemption, repurchase or other acquisition of subordinated Indebtedness with
the net cash proceeds from an incurrence of Permitted Refinancing Indebtedness;
(iv) the repurchase, redemption or other acquisition or retirement for value of
any Equity Interests of the Parent or any Restricted Subsidiary of the Parent
held by any member of the Parent's (or any of its Restricted Subsidiaries')
management or Board of Directors pursuant to any management equity subscription
agreement, stock option agreement or other similar
4
agreement, provided that the aggregate price paid for all such repurchased,
redeemed, acquired or retired Equity Interests shall not exceed $500,000 in any
twelve-month period and no Subordinated Term Loan D Default or Subordinated Term
Loan D Event of Default shall have occurred and be continuing immediately after
such transaction; (v) the repurchase or other acquisition of subordinated
Indebtedness in anticipation of satisfying a sinking fund or principal payment
obligation, in each case due within one year of the date of repurchase or other
acquisition, provided that the date such sinking fund or principal payment
obligation becomes due is prior to the final maturity date of the Subordinated
Term Loan D Loan Notes; (vi) repurchases of Equity Interests that may be deemed
to occur upon the exercise of options, warrants or other rights to acquire
Capital Stock of the Parent to the extent that such Equity Interests represent a
portion of the exercise price of such options, warrants or other rights; and
(vii) additional Restricted Payments in an amount not to exceed $5.0 million.
The amount of all Restricted Payments (other than cash) shall be the
fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Parent or such Restricted
Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair
market value of any non-cash Restricted Payment shall be determined in good
faith by the Board of Directors whose resolution with respect thereto shall be
delivered to the Holders. Not later than 30 days following the end of any fiscal
quarter in which any Restricted Payments were made, the Parent shall deliver to
the Holders an Officers' Certificate stating that such Restricted Payments were
permitted and setting forth the basis upon which the calculations required by
this Section 1.5 were computed.
The Board of Directors may designate any Restricted Subsidiary to be an
Unrestricted Subsidiary if such designation would not cause a Subordinated Term
Loan D Default. For purposes of making such determination, all outstanding
Investments by the Parent and its Restricted Subsidiaries (except to the extent
repaid in cash) in the Subsidiary so designated will be deemed to be Restricted
Payments at the time of such designation and will reduce the amount available
for Restricted Payments under the first paragraph of this covenant. All such
outstanding Investments will be deemed to constitute Investments in an amount
equal to the greatest of (i) the net book value of such Investments at the time
of such designation, (ii) the fair market value of such Investments at the time
of such designation and (iii) the original fair market value of such Investments
at the time they were made. Such designation will only be permitted if such
Restricted Payment would be permitted at such time and if such Restricted
Subsidiary otherwise meets the definition of an Unrestricted Subsidiary.
Any such designation by the Board of Directors shall be evidenced to
the Holders by delivering to such Holders of a certified copy of the Board
resolution giving effect to such designation and an Officers' Certificate
certifying that such designation complied with the foregoing conditions. If, at
any time, any Unrestricted Subsidiary would fail to
5
meet the definition of an Unrestricted Subsidiary, it shall thereafter cease to
be an Unrestricted Subsidiary for purposes of this Agreement and any
Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted
Subsidiary of the Parent as of such date (and, if such Indebtedness is not
permitted to be incurred as of such date under Section 1.7 of this Annex, the
Parent shall be in Subordinated Term Loan D Default of such Section). The Board
of Directors of the Parent may at any time designate any Unrestricted Subsidiary
to be a Restricted Subsidiary, provided that such designation shall be deemed to
be an incurrence of Indebtedness by a Restricted Subsidiary of the Parent of any
outstanding Indebtedness of such Unrestricted Subsidiary and such designation
shall only be permitted if (i) such Indebtedness as permitted under Section 1.7
of this Annex is calculated on a pro forma basis as if such designation had
occurred at the beginning of the four-quarter reference period, and (ii) no
Subordinated Term Loan D Default or Subordinated Term Loan D Event of Default
would be in existence following such designation.
Section 1.6 Dividend and Other Payment Restrictions Affecting
Subsidiaries. The Parent shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary to (i) (a) pay dividends or make any other distributions
to the Parent or any of its Restricted Subsidiaries (1) on its Capital Stock or
(2) with respect to any other interest or participation in, or measured by, its
profits, or (b) pay any indebtedness owed to the Parent or any of its Restricted
Subsidiaries, (ii) make loans or advances to the Parent or any of its Restricted
Subsidiaries or (iii) transfer any of its properties or assets to the Parent or
any of its Restricted Subsidiaries, except for such encumbrances or restrictions
existing under or by reason of (a) Existing Indebtedness as in effect on the
Effective Date, (b) this Agreement as in effect as of the Effective Date, and
any amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings thereof, provided that such amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacement or refinancings are no more restrictive with respect to such
dividend and other payment restrictions than those contained in this Agreement
as in effect on the Effective Date, (c) the Senior Notes, any Subsidiary
Guarantee thereof and the Indenture, (d) applicable law, (e) any instrument
governing Indebtedness or Equity Interests of a Person acquired by the Parent or
any of its Restricted Subsidiaries as in effect at the time of such acquisition
(except to the extent such Indebtedness was incurred in connection with or in
contemplation of such acquisition), which encumbrance or restriction is not
applicable to any Person, or the Equity Interests, properties or assets of any
Person, other than the Person, or the Equity Interests, property or assets of
the Person, so acquired, provided that, in the case of Indebtedness, such
Indebtedness was permitted by the terms of this Agreement to be incurred, (f) by
reason of customary nonassignment provisions in leases entered into in the
ordinary course of business and consistent with past practices, (g) purchase
money obligations for property acquired in the ordinary course of business that
impose
6
restrictions of the nature described in clause (iii) above on the property so
acquired, (h) customary restrictions in asset or stock sale agreements limiting
transfer of such assets or stock pending the closing of such sale, (i) customary
non-assignment provisions in contracts entered into in the ordinary course of
business, (j) Permitted Refinancing Indebtedness, provided that the restrictions
contained in the agreements governing such Permitted Refinancing Indebtedness
are no more restrictive than those contained in the agreements governing the
Indebtedness being refinanced, or (k) any Purchase Money Note, or other
Indebtedness or contractual requirements incurred with respect to a Qualified
Receivables Transaction relating to a Receivables Subsidiary.
Section 1.7 Incurrence of Indebtedness and Issuance of Preferred
Stock. The Parent shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt) and that the Parent's Restricted Subsidiaries will not issue any shares of
preferred stock (other than to the Parent or a Wholly Owned Restricted
Subsidiary of the Parent), provided that the Parent and the Guarantors may incur
Indebtedness (including Acquired Debt) if the Consolidated Interest Coverage
Ratio for the Parent's most recently ended four full fiscal quarters for which
internal financial statements are available immediately preceding the date on
which such additional Indebtedness is incurred would have been at least 2.0 to
1, determined on a pro forma basis (including a pro forma application of the net
proceeds therefrom), as if the additional Indebtedness had been incurred at the
beginning of such four-quarter period.
The provisions of the first paragraph of this covenant will not apply
to the incurrence of any of the following (collectively, "Permitted Debt"):
(i) the incurrence by the Parent and the
Guarantors of Indebtedness under (a) this Agreement and (b)
Capital Lease Obligations and purchase money financing in
respect of property, plant and equipment, provided that the
aggregate amount of Indebtedness incurred pursuant to this
clause (i) shall not exceed at any time outstanding the
greater of (1) $230.0 million and (2) the sum of (A) 80% of
the consolidated accounts receivable of the Parent as shown on
the Parent's most recent balance sheet, plus (B) 60% of the
consolidated inventory of the Parent as shown on the Parent's
most recent balance sheet, plus (C) 50% of the consolidated
property, plant and equipment, net of depreciation, of the
Parent as shown on the Parent's most recent balance sheet;
(ii) the incurrence by the Parent and the
Subsidiary Guarantors of Indebtedness represented by the
Senior Notes, the Subsidiary Guarantees and the Indenture;
7
(iii) the incurrence by the Parent and its
Restricted Subsidiaries of the Existing Indebtedness;
(iv) the incurrence by the Parent and the
Guarantors of additional Indebtedness in an aggregate amount
not to exceed $10.0 million at any time outstanding;
(v) the incurrence by the Parent and the
Guarantors of Indebtedness in connection with the acquisition
of assets or a new Restricted Subsidiary, provided that such
Indebtedness was incurred by the prior owner of such assets or
such Restricted Subsidiary prior to such acquisition by the
Parent and the Guarantors and was not incurred in connection
with, or in contemplation of, such acquisition by the Parent
and the Guarantors, and provided further that the aggregate
amount of Indebtedness incurred pursuant to this clause (v)
does not exceed $5.0 million at any time outstanding;
(vi) the incurrence by the Parent and its
Restricted Subsidiaries of Permitted Refinancing Indebtedness
in exchange for, or the net proceeds of which are used to
refund, refinance or replace Indebtedness that was permitted
to be incurred by the first paragraph, or by clauses (ii)
through (ix) of the second paragraph of this Section 1.7;
(vii) the incurrence of Indebtedness between or
among the Parent and its Restricted Subsidiaries, provided
that any subsequent issuance or transfer of Equity Interests
that results in any such Indebtedness being held by a Person
other than the Parent or a Restricted Subsidiary, and any sale
or other transfer of any such Indebtedness to a Person that is
not either the Parent or a Restricted Subsidiary, shall be
deemed, in each case, to constitute an incurrence of such
Indebtedness by the Parent or such Restricted Subsidiary, as
the case may be;
(viii) the incurrence by the Parent and its
Restricted Subsidiaries of Hedging Obligations that are
incurred for the purpose of fixing or hedging (a) interest
rate risk with respect to any Indebtedness that is permitted
by the terms of this Section 1.7 to be outstanding or (b)
foreign currency risk;
(ix) the incurrence of Indebtedness by a
Restricted Subsidiary of the Parent that is not a Guarantor in
an aggregate amount not to exceed the sum of (a) 80% of the
accounts receivable of such Subsidiary as shown on such
Subsidiary's most recent balance sheet, plus (b) 60% of the
inventory of such Subsidiary as shown on such Subsidiary's
8
most recent balance sheet, plus (c) 50% of the property, plant
and equipment, net of depreciation, of such Subsidiary as
shown on such Subsidiary's most recent balance sheet;
(x) the guarantee by the Parent or any Guarantor
of Indebtedness that was permitted to be incurred by another
provision of this Section 1.7; and
(xi) Indebtedness of a Receivables Subsidiary
that is not recourse to the Parent or any of its Restricted
Subsidiaries (other than Standard Securitization Undertakings)
incurred in connection with a Qualified Receivables
Transaction.
For purposes of determining the amount of any Indebtedness of any Person under
this Section 1.7, (a) there shall be no double counting of direct obligations,
guarantees and reimbursement obligations for letters of credit; (b) the
principal amount of any Indebtedness of such Person arising by reason of such
Person having granted or assumed a Lien on its property to secure Indebtedness
of another Person shall be the lower of the fair market value of such property
and the principal amount of such Indebtedness outstanding (or committed to be
advanced) at the time of determination; (c) the amount of any Indebtedness of
such Person arising by reason of such Person having guaranteed Indebtedness of
another Person where the amount of such guarantee is limited to an amount less
than the principal amount of the Indebtedness so guaranteed shall be such amount
as so limited; (d) Indebtedness shall not include a nonrecourse pledge by the
Parent or any of its Restricted Subsidiaries of Investments in any Person that
is not a Restricted Subsidiary of the Parent to secure the Indebtedness of such
Person; and (e) Indebtedness of the Parent and its Restricted Subsidiaries shall
not include Indebtedness of a Restricted Subsidiary whose assets consist solely
of partnership or similar interests in another person that is not a Restricted
Subsidiary of the Parent, where the obligations with respect to such
Indebtedness arise as a matter of law from the obligations of such other Person.
For purposes of determining compliance with this Section 1.7, in the
event that an item of Indebtedness meets the criteria of more than one of the
categories of Permitted Debt described in clauses (i) through (x) above or is
entitled to be incurred pursuant to the first paragraph of this Section 1.7, the
Parent shall, in its sole discretion, classify such item of Indebtedness in any
manner that complies with this Section 1.7 and such item of Indebtedness will be
treated as having been incurred pursuant to only one of such clauses or pursuant
to the first paragraph hereof. Accrual of interest, the accretion of accredit
value and the payment of interest in the form of additional Indebtedness will
not be deemed to be an incurrence of Indebtedness for purposes of this Section
1.7.
9
Section 1.8 Asset Sales. The Parent shall not, and shall not
permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless
(i) the Parent or such Restricted Subsidiary, as the case may be, receives
consideration at the time of such Asset Sale at least equal to the fair market
value (evidenced by a resolution of the Board of Directors set forth in an
Officers' Certificate delivered to the Holders of the assets or Equity Interests
issued or sold or otherwise disposed of and (ii) at least 75% of the
consideration therefor received by the Parent or such Restricted Subsidiary is
in the form of cash or Cash Equivalents, provided that the amount of (a) any
liabilities (as shown on the Parent's or such Restricted Subsidiary's most
recent balance sheet) of the Parent or such Restricted Subsidiary (other than
contingent liabilities and liabilities that are by their terms subordinated to
the Subordinated Term Loan D Notes or any Guaranty) that are assumed by the
transferee of any such assets pursuant to a customary novation agreement that
releases the Parent or such Restricted Subsidiary from farther liability and (b)
any securities, notes or other obligations received by the Parent or such
Restricted Subsidiary from such transferee that are immediately converted by the
Parent or such Restricted Subsidiary into cash (to the extent of the cash
received) shall be deemed to be cash for purposes of this provision.
In the event of any Asset Sale, but only after all Senior Obligations
have been paid in full in cash and the Total Revolving Credit Commitment has
been terminated, the principal (together with interest on such principal) of the
Subordinated Term Loan D Notes shall become due and payable to the extent of any
Net Proceeds from any Asset Sale available for application to Subordinated
Obligations pursuant to Section 2.05(d) of Article II of this Agreement.
Section 1.9 Transaction with Affiliates. The Parent shall not,
and shall not permit any of its Restricted Subsidiaries to, make any payment to,
or sell, lease, transfer or otherwise dispose of any of its properties or assets
to, or purchase any property or assets from, or enter into or make or amend any
transaction, contract, agreement, understanding, loan, advance or guarantee
with, or for the benefit of, any Affiliate (each of the foregoing, an "Affiliate
Transaction"), unless (i) such Affiliate Transaction is on terms that are no
less favorable to the Parent or such Restricted Subsidiary than those that would
have been obtained in a comparable transaction by the Parent or such Restricted
Subsidiary with an unrelated Person and (ii) the Parent delivers to the Holders
(a) with respect to any Affiliate Transaction or series of related Affiliate
Transactions involving aggregate consideration in excess of $3.0 million, a
resolution of the Board of Directors set forth in an Officers' Certificate
certifying that such Affiliate Transaction complies with clause (i) above and
that such Affiliate Transaction has been approved by a majority of the
disinterested members of the Board of Directors and (b) except in the case of
the provision of services in the ordinary course of business to, or the receipt
of services in the ordinary course of business from, any Person who is an
Affiliate of the Parent solely by reason of an Investment in such Person by the
Parent or its Subsidiaries, with respect to any Affiliate Transaction or series
of related Affiliate Transactions involving aggregate
10
consideration in excess of $5.0 million, an opinion as to the fairness to the
Holders of such Affiliate Transaction from a financial point of view issued by
an accounting, appraisal or investment banking firm of national standing.
The foregoing provisions will not prohibit (i) any employment agreement
or other compensation plan or arrangement in the ordinary course of business and
either consistent with past practice or approved by a majority of the
disinterested members of the Board of Directors; (ii) transactions between or
among the Parent and/or its Restricted Subsidiaries; (iii) any Permitted
Investment or any Restricted Payment that is permitted by Section 1.6 hereof;
(iv) sales of Equity Interests (other than Disqualified Stock) to Affiliates of
the Parent; (v) transactions with Haul Insurance, provided that no less than
once each calendar year, the Parent delivers to the Holders a resolution of the
Board of Directors set forth in an Officers' Certificate certifying that such
transactions are in the ordinary course of business and consistent with past
practices and prudent insurance underwriting standards; (vi) transactions in
existence on the Effective Date, and any modifications thereof or extensions
thereto the terms of which are not materially more adverse to the Parent than
those in existence on the Effective Date, including, in each case, all future
payments pursuant thereto; and (vii) sales of accounts receivable and other
related assets customarily transferred in an asset securitization transaction
involving accounts receivable to a Receivables Subsidiary in a Qualified
Receivables Transaction.
Section 1.10 Liens. The Parent shall not, and shall not permit
any of its Restricted Subsidiaries to, directly or indirectly, create, incur,
assume or suffer to exist any Lien securing Indebtedness or trade payables on
any asset now owned or hereafter acquired, or any income or profits therefrom or
assign or convey any right to receive income therefrom, except Permitted Liens,
unless the Holders are equally and ratably secured with the obligations so
secured until such time as such obligations are no longer secured by a Lien.
Section 1.11 Additional Subsidiary Guarantees. Without limiting
any other provision of this Agreement, if the Parent or any of its Restricted
Subsidiaries shall acquire or create another Domestic Restricted Subsidiary
after the Effective Date, or any Unrestricted Subsidiary shall cease to be an
Unrestricted Subsidiary and shall become a Domestic Restricted Subsidiary, then
such Subsidiary shall execute a Guaranty of the Subordinated Term Loan D Notes,
in accordance with the terms of this Agreement and deliver to the Holders an
Opinion of Counsel.
Section 1.12 Corporate Existence. Subject to Section 1.14 of this
Annex, the Parent shall do or cause to be done all things necessary to preserve
and keep in full force and effect (i) its corporate existence, and the
corporate, partnership or other existence of each of its Subsidiaries, in
accordance with the respective organizational documents (as the same may be
amended from time to time) of the Parent or any such Subsidiary and (ii) the
rights (charter and statutory), licenses and franchises of the Parent and its
11
Subsidiaries, provided, that the Parent shall not be required to preserve any
such right, license or franchise, or the corporate, partnership or other
existence of any of its Subsidiaries, if the Board of Directors shall determine
that the preservation thereof is no longer desirable in the conduct of the
business of the Parent and its Subsidiaries, taken as a whole, and that the loss
thereof is not adverse in any material respect to the Holders of the
Subordinated Term Loan D Notes.
Section 1.13 Payments for Consent. Neither the Parent nor any of
its Restricted Subsidiaries shall, pay or cause to be paid any consideration,
whether by way of interest, fee or otherwise, to any Holder for or as an
inducement to any consent, waiver or amendment of any of the terms or provisions
of this Agreement or the Subordinated Term Loan D Notes unless such
consideration is offered to be paid or is paid to all Holders that consent,
waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement.
Section 1.14 Merger, Consolidation, or Sale of Assets. Neither the
Parent nor any Guarantor will consolidate or merge with or into (whether or not
the Parent or such Guarantor, as the case may be, is the surviving corporation),
or sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of its properties or assets in one or more related
transactions to another Person unless (i) the Parent or such Guarantor, as the
case may be, is the surviving corporation or the Person formed by or surviving
any such consolidation or merger (if other than the Parent or such Guarantor) or
to which such sale, assignment, transfer, lease, conveyance or other disposition
shall have been made is a corporation organized or existing under the laws of
the United States, any state thereof or the District of Columbia; (ii) the
Person formed by or surviving any such consolidation or merger (if other than
the Parent or a Guarantor) or the Person to which such sale, assignment,
transfer, lease, conveyance or other disposition shall have been made assumes
all the obligations of the Parent or such Subsidiary Guarantor, as the case may
be, under the Subordinated Term Loan D Notes or such Guarantor's Guaranty
thereof and this Agreement pursuant to an agreement in a form reasonably
satisfactory to the Holders; (iii) immediately after such transaction, no
Subordinated Term Loan D Default or Subordinated Term Loan D Event of Default
exists; and (iv) except in the case of a merger of the Parent or such Guarantor
with or into another Guarantor or a Wholly Owned Restricted Subsidiary of the
Parent, or a merger of a Guarantor with or into another Person in connection
with a Permitted Investment in such Person, the Parent or the Person formed by
or surviving any such consolidation or merger (if other than the Parent), or to
which such sale, assignment, transfer, lease, conveyance or other disposition
shall have been made (A) will have Consolidated Net Worth immediately after the
transaction equal to or greater than the Consolidated Net Worth of the Parent
immediately preceding the transaction and (B) will, at the time of such
transaction and after giving pro forma effect thereto as if such transaction had
occurred at the beginning of the applicable four-quarter period, be permitted to
incur at least $1.00 of additional
12
Indebtedness pursuant to the Consolidated Interest Coverage Ratio test set forth
in the first paragraph of Section 1.7 of this Annex.
Section 1.15 Successor Corporation Substituted. Upon any
consolidation or merger, or any sale, assignment, transfer, lease, conveyance or
other disposition of all or substantially all of the assets of the Parent in
accordance with Section 1.14 of this Annex, the successor corporation formed by
such consolidation or into or with which the Parent is merged or to which such
sale, assignment, transfer, lease, conveyance or other disposition is made shall
succeed to, and be substituted for (so that from and after the date of such
consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Parent" shall refer instead to
the successor corporation and not to the Parent), and may exercise every right
and power of the Parent under this Agreement with the same effect as if such
successor Person had been named as the Parent herein, provided that the
predecessor Parent shall not be relieved from the obligation to pay the
principal of and interest on the Subordinated Term Loan D Notes except in the
case of a sale of all of the Parent's assets that meets the requirements of
Section 1.14 of this Annex.
Section 1.16 Amendments to Indenture. The Parent will not, and
will not permit any Subsidiary to, (a) amend, modify or otherwise change (or
permit the amendment, modification or other change in any manner of) any of the
provisions of the Indenture or the Senior Notes, or (b) make any voluntary or
optional payment, prepayment, redemption, defeasance, sinking fund payment or
other acquisition for value of the Senior Notes (including, without limitation,
by way of depositing money or securities with the trustee therefore before the
date required for the purpose of paying any portion thereof when due), or
refund, refinance, replace or exchange any other Indebtedness for such Senior
Notes, or give notice with respect to any of the foregoing.
Section 1.17 Release of Guaranty. Without limiting any rights of
the Agents or the Senior Lenders contained in Section 12.02(c) of the Agreement,
in the event of a sale or other disposition of all of the assets of any
Guarantor, by way of merger, consolidation or otherwise, or a sale or other
disposition of all of the Capital Stock of any Guarantor, or in case the Parent
designates a Guarantor to be an Unrestricted Subsidiary in accordance with the
terms hereof, then such Guarantor (in the event of a sale or other disposition
by way of such a merger, consolidation or otherwise, of all of the Capital Stock
of such Guarantor, or in case the Parent designates a Guarantor to be an
Unrestricted Subsidiary in accordance with the terms hereof) or the Person
acquiring the property (in the event of a sale or other disposition of all of
the assets of such Guarantor), shall be released and relieved of its obligations
under its Guaranty with respect to the Subordinated Obligations, provided that
(a) such Guarantor's obligations with respect to the Senior Obligations shall
have contemporaneously been released, and (b) in the event of an Asset Sale, the
Net Proceeds from such sale or other disposition are treated in accordance with
the provisions hereof. Upon delivery by the Parent of an Officers' Certificate
to the
13
effect that such sale or other disposition was made by the Parent in accordance
with the provisions hereof, the Holders shall execute any documents reasonably
required in order to evidence the release of any Guarantor from its obligations
under its Guaranty with respect to the Subordinated Obligations, so long as
comparable documents are being executed to evidence the release of such
Guarantor from its obligations under its Guaranty with respect to the Senior
Obligations.
Section 1.18 Section 7.01 Covenants. So long as any principal of
or interest on a Subordinated Term Loan D Note or any other Subordinated
Obligation (whether or not due) shall remain unpaid, the Parent will, and will
cause each of its Subsidiaries or the Designated Loan Parties, as applicable, to
comply with the following provisions of Section 7.01 of the Agreement (which
provisions are incorporated herein by reference as if set forth herein in full):
(a) prior to the Senior Facility Termination Date, Sections
7.01(b)(i)(A) (to the extent delivered to the Agents and the Senior Lenders) and
7.01(j)(v); and
(b) on and after the Senior Facility Termination Date, Sections
7.01(b), 7.01(j)(v), the other provisions of Section 7.01(j) insofar as they
relate to any property constituting Collateral, and Sections 7.01(k) and
7.01(o).
14
ANNEX 2
SUBORDINATED TERM LOAN D EVENTS OF DEFAULT AND REMEDIES THEREFOR
Section 2.1 Term D Events of Default. Any one or more of the
following shall constitute a "Subordinated Term Loan D Event of Default" as such
term is used herein:
(a) Default shall occur in the payment of interest on any
Subordinated Term Loan D Note when the same shall have become due and
such default shall continue for more than five days; or
(b) Default shall occur in the making of any required
prepayment on any of the Subordinated Term Loan D Notes as provided in
Section 1.8 of Annex 1 or Section 5.7 of Annex 5; or
(c) Default shall occur in the making of any other
payment of the principal of any Subordinated Term Loan D Note at the
expressed or any accelerated maturity date or at any date fixed for
prepayment; or
(d) Default by the Parent or any Restricted Subsidiary
(as principal or as guarantor or other surety) shall occur in the
payment of any principal of or premium or make-whole amount or interest
on, or in the performance of or compliance with any term of, any
evidence of any Indebtedness in an aggregate outstanding principal
amount of at least $5,000,000 or of any mortgage, indenture or other
agreement relating thereto or any other condition exists, and as a
consequence of such default or condition such Indebtedness has become,
or has been declared to be, due and payable before its stated maturity
or before its regularly scheduled dates of payment; or
(e) Default shall occur in the observance or performance
of any covenant or agreement contained in Sections 1.5, 1.6, 1.7 or
1.14 of Annex 1; or
(f) Default shall occur in the observance or performance
by the Parent of any other provision of the Annexes, or, after the
Senior Facility Termination Date, any other Section of this Agreement,
which is not remedied within 30 days after the earlier of (i) the day
on which the Parent first obtains knowledge of such default, or (ii)
the day on which written notice thereof is given to the Parent by any
Holder; or
(g) Insofar as such provision in any way relates,
directly or indirectly, in whole or in part, to any Subordinated
Obligation, a default shall occur in the observance or performance by
any Guarantor of (i) Section 11.01 of the Agreement, or (ii) of any
other provisions of any Guaranty which is not remedied within 30 days
after the earlier of (x) the day on which such Guarantor first
obtains knowledge of such default, or (y) the day on which written
notice thereof is given to such Guarantor by any Holder; or
(h) Any representation or warranty made by the Parent or
any Guarantor (1) contained in Section 6.01(a) through (e), (f)(i), (h)
through (l), (o), (p), (r) (s), (u), (y), (z), (bb) and (jj), or (2)
after the Senior Facility Termination Date, contained in such Section
6.01 of the Agreement (other than those referred to in clause (1)
above), or made by the Parent or any Guarantor in any statement or
certificate furnished by the Parent or any Guarantor in connection with
the consummation of the issuance and delivery of the Subordinated Term
Loan D Notes or furnished by the Parent or any Guarantor pursuant
hereto, is untrue in any material respect as of the date of the
issuance or making thereof; or
(i) Final judgment or judgments for the payment of money
aggregating in excess of $3,000,000 is or are outstanding against the
Parent or any Restricted Subsidiary or against any property or assets
of either and any one of such judgments has remained unpaid, unvacated,
unbonded or unstayed by appeal or otherwise for a period of 90 days
from the date of its entry or such lesser period within which, under
applicable law or rules of court, a judgment must be paid, vacated,
bonded or stayed in order to prevent the judgment creditor from levying
upon property of the judgment debtor; or
(j) A custodian, liquidator, trustee or receiver is
appointed for the Parent or any Restricted Subsidiary or for the major
part of the property of either and is not discharged within 60 days
after such appointment; or
(k) The Parent or any Restricted Subsidiary becomes
insolvent or bankrupt, is generally not paying its debts as they become
due or makes an assignment for the benefit of creditors, or the Parent
or any Restricted Subsidiary applies for or consents to the appointment
of a custodian, liquidator, trustee or receiver for the Parent or such
Restricted Subsidiary or for the major part of the property of either;
or
(l) Bankruptcy, reorganization, arrangement or insolvency
proceedings, or other proceedings for relief under any bankruptcy or
similar law or laws for the relief of debtors, are instituted by or
against the Parent or any Restricted Subsidiary and, if instituted
against the Parent or any Restricted Subsidiary, are consented to or
are not dismissed within 60 days after such institution; or
(m) Any Lien on any Collateral pursuant to any Loan
Document which secures the Senior Obligations shall fail to also secure
the Subordinated Obligations (subject to the terms and priorities
specified herein) which failure is
2
not remedied within 30 days after written notice thereof is given to
the Parent and to the Collateral Agent from any Holder.
3
Section 2.2 Notice to Holders. When any Subordinated Term Loan D
Event of Default described in the foregoing Section 2.1 has occurred, or if any
Holder or the holder of any other evidence of Indebtedness of the Parent or any
Restricted Subsidiary gives any notice or takes any other action with respect to
a claimed default, the Parent agrees to give notice within three Business Days
of such event to all Holders.
Section 2.3 Acceleration of Maturities. When any Subordinated
Term Loan D Event of Default described in paragraph (a), (b) or (c) of the
foregoing Section 2.1 has happened and is continuing, any Holder may, and when
any Subordinated Term Loan D Event of Default described in paragraphs (d)
through (j), inclusive, or paragraph (m) through (p), inclusive, of said Section
2.1 has happened and is continuing, any Holder or Holders holding 34% or more of
the principal amount of Subordinated Term Loan D Notes at the time outstanding
may, by notice to the Parent, declare the entire principal and all interest
accrued on all Subordinated Term Loan D Notes to be, and all Subordinated Term
Loan D Notes shall thereupon become, forthwith due and payable, without any
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived. When any Subordinated Term Loan D Event of Default
described in paragraph (k) or (l) of Section 2.1 has occurred, then all
outstanding Subordinated Term Loan D Notes shall immediately become due and
payable without presentment, demand or notice of any kind. Upon the Subordinated
Term Loan D Notes becoming due and payable as a result of any Subordinated Term
Loan D Event of Default as aforesaid, the Parent will forthwith pay to the
Holders, the entire principal and interest accrued on the Subordinated Term Loan
D Notes. No course of dealing on the part of the Holder or Holders nor any delay
or failure on the part of any Holder to exercise any right shall operate as a
waiver of such right or otherwise prejudice such Holder's rights, powers and
remedies. The Parent further agrees, to the extent permitted by law, to pay to
the Holder or Holders all costs and expenses incurred by them in the collection
of any Subordinated Term Loan D Notes upon any default hereunder or thereon,
including reasonable compensation to such Holder's or Holders' attorneys for all
services rendered in connection therewith.
Section 2.4 Rescission of Acceleration. The provisions of the
foregoing Section 2.3 are subject to the condition that if the principal of and
accrued interest on all or any outstanding Subordinated Term Loan D Notes have
been declared immediately due and payable by reason of the occurrence of any
Subordinated Term D Event of Default described in paragraphs (a) through (j),
inclusive, or (m) through (p), inclusive, of Section 2.1, the Holders holding
67% in aggregate principal amount of the Subordinated Term Loan D Notes then
outstanding may, by written instrument filed with the Parent, rescind and annul
such declaration and the consequences thereof, provided that at the time such
declaration is annulled and rescinded:
(i) no judgment or decree has been entered for the
payment of any monies due pursuant to the Subordinated Term
Loan D Notes or this
4
Agreement (insofar as it relates to the Holders or the
Subordinated Term Loan D Notes);
(ii) all arrears of interest upon all the
Subordinated Term Loan D Notes and all other sums payable
under the Subordinated Term Loan D Notes and (insofar as it
relates to the Holders or the Subordinated Term Loan D Notes)
under this Agreement (except any principal or interest on the
Subordinated Term Loan D Notes which has become due and
payable solely by reason of such declaration under Section
2.3) shall have been duly paid; and
(iii) each and every other Subordinated Term Loan D
Default and Subordinated Term Loan D Event of Default shall
have been made good, cured or waived pursuant to Section
12.02;
and provided further, that no such rescission and annulment shall
extend to or affect any subsequent Subordinated Term Loan D Default or
Subordinated Term Loan D Event of Default or impair any right consequent
thereto.
5
ANNEX 3
SUBORDINATION OF SUBORDINATED INDEBTEDNESS LIABILITIES
The Subordinated Indebtedness Liabilities shall be subordinate and
junior in right of payment, to the extent and in the manner hereinafter set
forth, to all Senior Indebtedness Liabilities, whether now outstanding or
hereafter incurred:
(a) In the event of any insolvency or bankruptcy proceedings,
and any receivership, liquidation, reorganization, arrangement or other
similar proceedings in connection therewith, relative to the Parent or
to its creditors, as such, or to its property, and in the event of any
proceedings, for voluntary liquidation, dissolution or other winding-up
of the Parent, whether or not involving insolvency or bankruptcy, then
the holders of Senior Indebtedness Liabilities shall be entitled to
receive from the Parent irrevocable payment in full of all Senior
Indebtedness Liabilities owed thereby in cash or other property
acceptable to the holders of the Senior Indebtedness Liabilities (or to
have such payment duly provided for in a manner satisfactory to the
holders of said Senior Indebtedness Liabilities) before the holders of
the Subordinated Indebtedness Liabilities are entitled to receive any
payment from the Parent in respect of the Subordinated Indebtedness
Liabilities owed thereby, and to that end the holders of Senior
Indebtedness Liabilities shall be entitled to receive for application
in payment thereof any payment or distribution of any kind or
character, whether in cash or property or Securities, which may be
payable or deliverable in any such proceedings in respect of the
Subordinated Indebtedness Liabilities, excepting only Securities which
are in all respects subordinate and junior in right of payment to the
payment in full of all Senior Indebtedness Liabilities then due and
owing upon terms substantially similar to those contained in this
Agreement and (unless different maturities and repayment terms are
provided for in a plan approved in a reorganization proceeding) having
maturities and terms of repayment similar to those applicable to the
Subordinated Term Loan D Notes.
(b) Upon the happening of any Senior Indebtedness Payment
Default, the holders of the Subordinated Indebtedness Liabilities shall
not be entitled to receive any payment on account thereof during the
period beginning on the date such Senior Indebtedness Payment Default
shall occur and ending upon the earlier of (1) the date such Senior
Indebtedness Payment Default has been waived in writing by the holders
of the related Senior Indebtedness Liabilities, (2) the date on which
notice that such Senior Indebtedness Payment Default shall have ceased
to exist is given by the holders of the related Senior Indebtedness
Liabilities or the Administrative Agent to the Parent and the holders
of the Subordinated Indebtedness Liabilities, and (3) the date on which
such Senior Indebtedness Payment Default has been cured or shall have
ceased to exist, provided that
blockage periods under this paragraph (b) shall not be in effect for
more than 179 days unless all of the related Senior Indebtedness
Liabilities shall have been declared by the holder thereof to be
immediately due and payable as the result of such Senior Indebtedness
Payment Default.
(c) Upon the happening of any Senior Indebtedness Covenant
Event of Default, the holders of the Subordinated Indebtedness
Liabilities shall not be entitled to receive any payment on account
thereof during the period beginning on a Payment Blockage Commencement
Date, as defined below, and ending upon the earlier of (1) the date on
which notice that such Senior Indebtedness Covenant Event of Default
has been waived is given by the Administrative Agent to the Parent and
the holders of the Subordinated Indebtedness Liabilities, (2) the date
on which notice that such Senior Indebtedness Covenant Event of Default
shall have ceased to exist is given by the Administrative Agent to the
Parent and the holders of the Subordinated Indebtedness Liabilities,
and (3) the date on which such Senior Indebtedness Covenant Event of
Default has been cured, provided that (i) no blockage period under this
paragraph (c) may begin within 360 days after the beginning of a
previous such blockage period, (ii) no more than four blockage periods
under this paragraph (c) may occur while the Subordinated Term Loan D
Notes remain outstanding, (iii) blockage periods with respect to any
Senior Indebtedness Covenant Event of Default under this paragraph (c)
shall not be in effect for more than 179 days, and (iv) no facts or
circumstances constituting a Senior Indebtedness Covenant Event of
Default existing on any Payment Blockage Commencement Date may be used
as a basis for any subsequent blockage period. As used herein, the term
"Payment Blockage Commencement Date" shall mean the date on which
written notice of a Senior Indebtedness Covenant Event of Default has
been sent by the Administrative Agent to the Holders.
(d) In the event that any holder of Subordinated Indebtedness
Liabilities shall obtain any cash or other assets of the Parent,
whether by voluntary action of the Parent, as a result of any
administrative, legal or equitable action, or otherwise, in violation
of the provisions of this Agreement, such holder of Subordinated
Indebtedness Liabilities shall, if it obtains knowledge of such fact
within one year of receipt of such cash or other assets by such holder,
pay, deliver and assign to the holders of the Senior Indebtedness
Liabilities such cash or assets for application to the Senior
Indebtedness Liabilities upon obtaining such knowledge.
No right of any present or future holder of any Senior Indebtedness
Liabilities of the Parent to enforce subordination as herein provided shall at
any time or in any way be prejudiced or impaired by any failure to act on the
part of the Parent, or by any noncompliance by the Parent with the terms,
provisions and covenants of this Agreement,
2
regardless of any knowledge thereof that any such holder of Senior Indebtedness
Liabilities may have or be otherwise charged with. The provisions hereof are
solely for the purpose of defining the relative rights of the holders of Senior
Indebtedness Liabilities on the one hand, and the holders of the Subordinated
Indebtedness Liabilities on the other hand, and nothing herein shall impair, as
between the Parent and the holders of the Subordinated Indebtedness Liabilities,
the obligation of the Parent, which is unconditional and absolute, to pay to the
holders of the Subordinated Indebtedness Liabilities the entire amount thereof
in accordance with the terms of the Subordinated Term Loan D Notes and this
Agreement, nor shall anything herein prevent the holder of any Subordinated
Indebtedness Liabilities from exercising all remedies otherwise permitted by
applicable law or under this Agreement or the Subordinated Term Loan D Notes
upon default under this Agreement or the Subordinated Term Loan D Notes, subject
to the rights, if any, of holders of Senior Indebtedness Liabilities as herein
provided.
Upon irrevocable payment in full of the Senior Indebtedness Liabilities
in cash or other property acceptable to the holders of the Senior Indebtedness
Liabilities, the holders of the Subordinated Indebtedness Liabilities shall be
subrogated to the rights of the holders of the Senior Indebtedness Liabilities
to receive payments or distributions of assets of the Parent made on or in
respect of Senior Indebtedness Liabilities until all amounts constituting
Subordinated Indebtedness Liabilities and all other amounts payable to the
holders of the Subordinated Indebtedness Liabilities shall be paid in full, and,
for the purposes of such subrogation, no payments to the holders of Senior
Indebtedness Liabilities of any cash, property, stock or obligations to which
the holders of the Subordinated Indebtedness Liabilities would be entitled
shall, as between the Parent, its creditors (other than the holders of Senior
Indebtedness Liabilities) and the holders of the Subordinated Indebtedness
Liabilities, be deemed to be a payment by the Parent to or on account of Senior
Indebtedness Liabilities.
In the event of any of the proceedings referred to in subparagraph (a)
above, if any holder of Subordinated Indebtedness Liabilities has not filed any
claim, proof of claim or other instrument of similar character necessary to
enforce the obligations of the Parent in respect of the Subordinated
Indebtedness Liabilities held by such holder at least 30 days before the
expiration of the time to file the same, then and in such event, but only in
such event, any holder of the Senior Indebtedness Liabilities may notify such
holder in the manner provided in Section 5.9 of Annex 5 of such fact and that
such holder of the Senior Indebtedness Liabilities shall, if such claim, proof
of claim or other instrument of similar character is not so filed by such holder
of Subordinated Indebtedness Liabilities at least ten days before the expiration
of the time to file the same, as an attorney-in-fact for such holder of
Subordinated Indebtedness Liabilities, file any claim, proof of claim or such
other instrument of similar character. At any time within ten days prior to the
expiration of the time to file such claim, proof of claim or other instrument,
if such holder of Subordinated Indebtedness Liabilities has not so filed the
same, the holder of the
3
Senior Indebtedness Liabilities which has complied with the notice provisions in
the immediately preceding sentence may, as attorney-in-fact for such holder of
Subordinated Indebtedness Liabilities and at its sole expense, file such claim,
proof of claim or other instrument and such holder of Subordinated Indebtedness
Liabilities, by such holder's acceptance of such holder's Subordinated Term Loan
D Notes, appoints such holder of the Senior Indebtedness Liabilities as an
attorney-in-fact for such holder of Subordinated Indebtedness Liabilities, to so
file any claim, proof of claim or such other instrument of similar character.
Notwithstanding the foregoing, the holder of Subordinated Indebtedness
Liabilities which has not filed such claim, proof of claim or other instruments
may then and thereupon pursue and enforce the obligations of the Parent in
respect of the Subordinated Indebtedness Liabilities held thereby.
4
ANNEX 4
DEFINITIONS
Section 4.1. Definitions. Unless the context otherwise requires,
the terms hereinafter set forth when used in the Annexes shall have the
following meanings and the following definitions shall be equally applicable to
both the singular and plural forms of any of the terms herein defined:
"Acquired Debt" means, with respect to any specified Person, (a)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person, including,
without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person, and (b) Indebtedness secured by a Lien
encumbering any asset acquired by such specified Person.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise, provided that
beneficial ownership of 10% or more of the voting securities of a Person shall
be deemed to be control.
"Affiliate Transaction" has the meaning set forth in Section 1.9 of
Annex 1.
"Annexes" means Annexes 1 through 5 of the Agreement, as amended,
modified or supplemented from time to time.
"Asset Sale" means (a) the sale, lease, conveyance or other disposition
of any assets or rights (including, without limitation, by way of a sale and
leaseback), excluding sales of services and ancillary products in the ordinary
course of business consistent with past practices, provided that the sale,
lease, conveyance or other disposition of all or substantially all of the assets
of the Parent and its Restricted Subsidiaries taken as a whole shall be governed
by Annex 1.14 of Schedule 1 and not by Section 1.8 of Annex 1, and (b) the issue
or sale by the Parent or any of its Subsidiaries of Equity Interests of any of
the Parent's Subsidiaries (other than directors' qualifying shares or shares
required by applicable law to be held by a Person other than the Parent or a
Restricted Subsidiary of the Parent), in the case of either clause (a) or (b),
whether in a single transaction or a series of related transactions (i) that
have a fair market value in excess of $1.0 million or (ii) for net proceeds in
excess of $1.0 million. Notwithstanding the foregoing, the
following shall be deemed not to be Asset Sales: (a) a transfer of assets by the
Parent to a Wholly Owned Restricted Subsidiary or by a Wholly Owned Restricted
Subsidiary to the Parent or to another Wholly Owned Restricted Subsidiary; (b)
an issuance of Equity Interests by a Wholly Owned Restricted Subsidiary to the
Parent or to another Wholly Owned Restricted Subsidiary; (c) a Permitted
Investment or Restricted Payment that is permitted by Section 1.5 of Annex 1;
(d) the exchange of Rigs or terminals for other assets that are usable in the
business of the Parent and its Restricted Subsidiaries to the extent that the
assets received by the Parent and its Restricted Subsidiaries have a fair market
value at least equal to the fair market value of the Rigs and terminals
exchanged by the Parent, in each case as determined in good faith by the Board
of Directors; (e) a disposition of Cash Equivalents solely for cash or other
Cash Equivalents; (f) a sale-leaseback transaction involving Rigs or real estate
within one year of the acquisition of such Rigs or real estate; and (g) the sale
of accounts receivables and related assets customarily transferred in an asset
securitization transaction involving accounts receivable to a Receivables
Subsidiary or by a Receivables Subsidiary in connection with a Qualified
Receivables Transaction.
"Board of Directors" means the Board of Directors of the Parent, or any
authorized committee of the Board of Directors.
"Business Day" means any day other than a Saturday, Sunday or other day
on which commercial banks in New York City are authorized or required to close.
"Capital Lease Obligation" means, at the time any determination thereof
is to be made, the amount of the liability in respect of a capital lease that
would at such time be required to be capitalized on a balance sheet in
accordance with GAAP.
"Capital Stock" means (a) in the case of a corporation, corporate
stock, (b) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
corporate stock, (c) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited) and (d) any
other interest or participation that confers on a Person the right to receive a
share of the profits and losses of, or distributions of assets of, the issuing
Person.
"Cash Equivalents" means (a) United States dollars, (b) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof having maturities of not
more than six months from the date of acquisition, (c) certificates of deposit
and Eurodollar time deposits with maturities of six months or less from the date
of acquisition, bankers' acceptances with maturities not exceeding six months
and overnight bank deposits, in each case with any Senior Lender or any
commercial bank which is an Affiliate thereof or with any domestic commercial
bank having capital and surplus in excess of $500.0 million and a Keefe Bank
Watch
2
Rating of AB or better, (d) repurchase obligations with a term of not more than
seven days for underlying securities of the types described in clauses (b) and
(c) above entered into with any financial institution meeting the qualifications
specified in clause (c) above and (e) commercial paper having the highest rating
obtainable from Moody's Investors Service, Inc. or Standard & Poor's Ratings
Services, a division of The McGraw-Hill Companies, Inc. and in each case
maturing within six months after the date of acquisition.
"Change of Control" means, with respect to the Parent or any successor
Person permitted by Section 1.4, the occurrences of any of the following: (a)
the adoption of a plan relating to the liquidation or dissolution of the Parent;
(b) the consummation of any transaction (including, without limitation, any
merger or consolidation) the result of which is that any "person" or "group" (as
such terms are used in Section 13(d)(3) of the Exchange Act), other than the
Principals, becomes the "beneficial owner" (as such term is defined in Rule
13d-3 and rule 13d-5 under the Exchange Act), directly or indirectly, of (i)
more than 35% of the voting power of the outstanding voting stock of the Parent
or (ii) more of the voting power of the outstanding voting stock of the Parent
than that beneficially owned by the Principals; or (c) the first day on which
more than a majority of the members of the Board of Directors are not Continuing
Directors.
"Consolidated Cash Flow" means, with respect to any Person for any
period, the Consolidated Net Income of such Person for such period plus, to the
extent deducted in computing such Consolidated Net Income, (a) an amount equal
to any extraordinary loss plus any net loss realized in connection with an Asset
Sale, (b) provision for taxes based on income or profits, (c) Consolidated
Interest Expense, and (d) depreciation and amortization (including amortization
of goodwill and other intangibles but excluding amortization of prepaid cash
expenses that were paid in a prior period). Notwithstanding the foregoing, the
provision for taxes based on the income or profits of, and the depreciation and
amortization of, a Person shall be added to Consolidated Net Income to compute
Consolidated Cash Flow only to the extent (and in the same proportion) that the
Net Income of such Person was included in calculating Consolidated Net Income.
"Consolidated Interest Coverage Ratio" means, with respect to any
Person for any period, the ratio of the Consolidated Cash Flow of such Person
for such period to the Consolidated Interest Expense of such Person and its
Restricted Subsidiaries for such period. In the event that the Parent or any of
its Restricted Subsidiaries incurs, assumes, guarantees, redeems or repays any
Indebtedness (other than revolving credit borrowings) subsequent to the
commencement of the period for which the Consolidated Interest Coverage Ratio is
being calculated but prior to the date on which the event for which the
calculation of the Consolidated Interest Coverage Ratio is made (the
"Calculation Date"), then the Consolidated Interest Coverage Ratio shall be
calculated giving pro forma effect to such incurrence, assumption, guarantee,
redemption or repayment of Indebtedness as if the same had occurred at the
beginning of the applicable four-quarter reference period.
3
In addition, for purposes of making the computation referred to above, (a)
acquisitions that have been made by the Parent or any of its Restricted
Subsidiaries, including through mergers or consolidations and including any
related financing transactions, and other transactions consummated by the Parent
or any of its Restricted Subsidiaries with respect to which pro forma effect may
be given pursuant to Article 11 of Regulation S-X under the Securities Act, in
each case during the four-quarter reference period or subsequent to such
reference period and on or prior to the Calculation Date shall be deemed to have
occurred on the first day of the four-quarter reference period and Consolidated
Cash Flow for such reference period shall be calculated without giving effect to
clause (d) of the proviso set forth in the definition of Consolidated Net
Income, (b) the Consolidated Cash Flow attributable to discontinued operations,
as determined in accordance with GAAP, and operations or businesses disposed of
prior to the Calculation Date, shall be excluded and (c) the Consolidated
Interest Expense attributable to discontinued operations, as determined in
accordance with GAAP, and operations or businesses disposed of prior to the
Calculation Date, shall be excluded, but only to the extent that the obligations
giving rise to such Consolidated Interest Expense will not be obligations of the
referent Person or any of its Restricted Subsidiaries following the Calculation
Date.
"Consolidated Interest Expense" means, with respect to any Person for
any period, the sum, without duplication, of (a) the consolidated interest
expense of such Person and its Restricted Subsidiaries for such period, whether
paid or accrued (including, without limitation, amortization of debt issuance
costs and original issue discount, non-cash interest payments, the interest
component of any deferred payment obligations, the interest component of all
payments associated with Capital Lease Obligations, commissions, discounts and
other fees and charges incurred in respect of letter of credit or bankers'
acceptance financings, and net payments (if any) pursuant to Hedging
Obligations), (b) the consolidated interest expense of such Person and its
Restricted Subsidiaries that was capitalized during such period and (c) any
interest expense on Indebtedness of another Person that is guaranteed by such
Person or one of its Restricted Subsidiaries or secured by a Lien on assets of
such Person or one of its Restricted Subsidiaries (whether or not such guarantee
or Lien is called upon), in each case, on a consolidated basis and in accordance
with GAAP.
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate of the Net Income of such Person and its Restricted
Subsidiaries for such period, on a consolidated basis, determined in accordance
with GAAP, provided that (a) if the Net Income of any Person that is not a
Restricted Subsidiary or that is accounted for by the equity method of
accounting is a gain, the Net Income of such Person shall be included only to
the extent of the amount of dividends or distributions paid in cash to the
referent Person or a Wholly Owned Restricted Subsidiary thereof, (b) if the Net
Income of any Person that is not a Restricted Subsidiary or that is accounted
for by the equity method of accounting is a loss, the Net Income of such Person
shall be excluded except to the extent that (i) the Parent or any of its
Restricted Subsidiaries funds such loss by
4
means of the provision of additional capital to such Person or (ii) the
aggregate losses of such Person excluded pursuant to this clause (b) exceed the
aggregate gains of such Person excluded pursuant to clause (a), (c) the Net
Income of any Person acquired in a pooling of interests transaction for any
period prior to the date of such acquisition shall be excluded, (d) the
cumulative effect of a change in accounting principles shall be excluded and (e)
solely for purposes of calculating Consolidated Interest Expense for purposes of
Section 1.7 of Annex 1, the Net Income of any Unrestricted Subsidiary shall be
excluded, whether or not distributed to the Parent or one of its Restricted
Subsidiaries.
"Consolidated Net Worth" means, with respect to any Person as of any
date, the sum of (a) the consolidated equity of the common stockholders of such
Person and its consolidated Restricted Subsidiaries as of such date, plus (b)
the respective amounts reported on such Person's balance sheet as of such date
with respect to any series of preferred stock (other than Disqualified Stock)
that by its terms is not entitled to the payment of dividends unless such
dividends may be declared and paid only out of net earnings in respect of the
year of such declaration and payment, but only to the extent of any cash
received by such Person upon issuance of such preferred stock, less (i) all
write-ups (other than write-ups resulting from foreign currency translations and
write-ups of tangible assets of a going concern business made within 12 months
after the acquisition of such business) subsequent to the Closing Date in the
book value of any asset owned by such Person or a consolidated Restricted
Subsidiary of such Person, (ii) all investments as of such date in
unconsolidated Subsidiaries and in Persons that are not Restricted Subsidiaries
and (iii) all unamortized debt discount and expense and unamortized deferred
charges as of such date, in each case determined in accordance with GAAP.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Parent who (a) was a member of such
Board of Directors on the Effective Date or (b) was nominated for election or
elected to such Board of Directors with the approval of a majority of the
Continuing Directors who were members of such Board at the time of such
nomination or election.
"Control Affiliate" means an Affiliate, not including the proviso
contained in the definition of Affiliate.
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the option of the holder thereof, in whole or in part, on or prior to the date
that is 91 days after the date on which the Subordinated Term Loan D Notes
mature, provided that any Capital Stock that would constitute Disqualified Stock
solely because the holders thereof (or of any security into which it is
convertible or for which it is exchangeable) have the right to require the
issuer to repurchase such Capital Stock (or such security into which it is
convertible or for which it is
5
exchangeable) upon the occurrence of an Asset Sale or a Change of Control shall
not constitute Disqualified Stock if such Capital Stock (and all such securities
into which it is convertible or for which it is exchangeable) provides that the
issuer thereof will not repurchase or redeem any such Capital Stock (or any such
security into which it is convertible or for which it is exchangeable) pursuant
to such provisions prior to compliance by the Parent with Section 2.05 of the
Agreement or 1.14 of Annex 1, as the case may be.
"Domestic Restricted Subsidiary" means a Restricted Subsidiary that is
not formed, incorporated or organized in a jurisdiction outside of the United
States.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Existing Indebtedness" means Indebtedness (other than Indebtedness
under this Agreement) in existence on the Effective Date, until such
Indebtedness is repaid.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and the statements and pronouncements
of the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect from time to time.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (a) currency exchange or interest rate swap,
cap or collar agreements and (b) other agreements or arrangements designed to
protect such Person against fluctuations in currency exchange or interest rates.
"Holder" shall mean any Person which is, at the time of reference, the
registered holder of any Subordinated Term Loan D Note.
"Indebtedness" means, with respect to any Person, (a) any indebtedness
of such Person, whether or not contingent, in respect of borrowed money or
evidenced by bonds, notes, debentures or similar instruments or letters of
credit (or reimbursement agreements in respect thereof) or banker's acceptances
or representing Capital Lease Obligations or the balance deferred and unpaid of
the purchase price of any property or representing any Hedging Obligations,
except any such balance that constitutes an accrued expense or trade payable, if
and to the extent any of the foregoing indebtedness (other than letters of
credit and Hedging Obligations) would appear as a liability upon a balance sheet
of such Person prepared in accordance with GAAP, (b) all indebtedness of others
secured by a Lien on any asset of such Person (whether or not such indebtedness
is assumed by such
6
Person) and (c) to the extent not otherwise included, the guarantee (other than
by endorsement of negotiable instruments for collection in the ordinary course
of business), direct or indirect, in any manner (including, without limitation,
letters of credit and reimbursement agreements in respect thereof), of all or
any part of any Indebtedness.
"Indenture" means the Indenture, dated as of September 30, 1997,
between Allied Holdings, Inc. the Subsidiary Guarantors named on the signature
pages thereto (together with all other Persons who execute a Subsidiary
Guarantee pursuant thereto) and The First National Bank of Chicago, as trustee,
as amended, modified or supplemented from time to time.
"Institutional Holder" shall mean any Holder which is a Purchaser or an
insurance company, bank, savings and loan association, trust company, investment
company, charitable foundation, employee benefit plan (as defined in ERISA) or
other institutional investor or financial institution and, for purposes of the
direct payment provisions of this Agreement, shall include any nominee of any
such Holder.
"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including guarantees of Indebtedness or other obligations),
advances or capital contributions (excluding commission, travel and similar
advances to officers and employees made in the ordinary course of business),
purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities, together with all items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP,
excluding, however, trade accounts receivable and bank deposits made in the
ordinary course of business. If the Parent or any Restricted Subsidiary of the
Parent sells or otherwise disposes of any Equity Interests of any direct or
indirect Subsidiary of the Parent such that, after giving effect to any such
sale or disposition, such Person is no longer a Subsidiary of the Parent, the
Parent shall be deemed to have made an Investment on the date of any such sale
or disposition equal to the fair market value of the Equity Interests of such
Subsidiary not sold or disposed of in an amount determined as provided in
Section 1.5 of Annex 1.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, and any option or other agreement to sell or give a Lien).
"Limited-Recourse Debt" means Indebtedness (a) as to which neither the
Parent nor any of its Restricted Subsidiaries (i) provides credit support of any
kind (including any undertaking, agreement or instrument that would constitute
Indebtedness) or is otherwise directly or indirectly liable (as a guarantor or
otherwise) or (ii) constitutes the
7
lender, except, in the case of clauses (i) and (ii), to the extent permitted by
Sections 1.5 and 1.7 of Annex 1, (b) no default with respect to which (including
any rights that the holders thereof may have to take enforcement action against
an Unrestricted Subsidiary) would permit (upon notice, lapse of time or both)
any holder of any other Indebtedness of the Parent or any of its Restricted
Subsidiaries to declare a default on such other Indebtedness or cause the
payment thereof to be accelerated or payable prior to its stated maturity and
(c) as to which the lenders have been notified in writing that they will not
have any recourse to the stock or assets of the Parent or any of its Restricted
Subsidiaries, except to the extent of any Indebtedness incurred by the Parent or
any of its Restricted Subsidiaries in accordance with clause (a)(i) above.
"Net Income" means, with respect to any Person, the net income (loss)
of such Person, determined in accordance with GAAP and before any reduction in
respect of preferred stock dividends, excluding, however, (a) any gain (but not
loss), together with any related provision for taxes on such gain (but not
loss), realized in connection with (i) any Asset Sale (including, without
limitation, dispositions pursuant to sale and leaseback transactions) or (ii)
the disposition of any securities by such Person or any of its Restricted
Subsidiaries or the extinguishment of any Indebtedness of such Person or any of
its Restricted Subsidiaries and (b) any extraordinary or nonrecurring gain (but
not loss), together with any related provision for taxes on such extraordinary
or nonrecurring gain (but not loss).
"Net Proceeds" means the aggregate cash proceeds received by the Parent
or any of its Restricted Subsidiaries in respect of any Asset Sale (including,
without limitation, any cash received upon the sale or other disposition of any
non-cash consideration received in any Asset Sale), net of (a) the direct costs
relating to such Asset Sale (including, without limitation, legal, accounting
and investment banking fees, and sales commissions) and any relocation expenses
incurred as a result thereof, (b) taxes paid or payable as a result thereof
(after taking into account any available tax credits or deductions and any tax
sharing arrangements), (c) amounts applied to the repayment of Indebtedness
secured by a Lien on the asset or assets that were the subject of such Asset
Sale and (d) any reserve for adjustment in respect of the sale price of such
asset or assets established in accordance with GAAP.
"Note Agreement" means the Note Agreement, dated as of January 15,
1996, among the Parent and the purchasers named on Schedule I attached thereto.
"Obligations" means (i) the obligations of any Borrower to pay, as and
when due and payable (by scheduled maturity or otherwise), all amounts from time
to time owing by it in respect of any Loan Document to which it is a party,
whether for principal, interest (including without limitation, all interest that
accrues after the commencement of any Insolvency Proceeding of any Borrower,
whether or not a claim for post-filing interest is allowed in such proceeding),
all Letter of Credit Obligations, fees,
8
commissions, expenses reimbursements, indemnifications or otherwise and (ii) the
obligations of any Borrower to perform or observe all of its other obligations
from time to time existing under any Loan Document to which it is a party.
"Officer" means, with respect to any Person, the Chairman of the Board,
the Chief Executive Officer, the President, the Chief Operating Officer, the
Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Controller,
the Secretary or any Vice President of such Person.
"Officers' Certificate" means a certificate signed on behalf of the
Parent by two Officers of the Parent, one of whom must be the principal
executive officer, the principal financial officer, the treasurer or the
principal accounting officer of the Parent.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Holders. The counsel may be an employee of or
counsel to the Parent or any Subsidiary of the Parent.
"Permitted Debt" has the meaning set forth in Section 1.7 of Annex 1.
"Permitted Investments" means (a) any Investment in the Parent or in a
Restricted Subsidiary of the Parent; (b) any Investment in Cash Equivalents; (c)
any Investment by the Parent or any Restricted Subsidiary of the Parent in a
Person, if as a result of such Investment (i) such Person becomes a Restricted
Subsidiary of the Parent or (ii) such Person is merged, consolidated or
amalgamated with or into, or transfers or conveys substantially all of its
assets to, or is liquidated into, the Parent or a Restricted Subsidiary of the
Parent; (d) any Restricted Investment made as a result of the receipt of
non-cash consideration from (i) an Asset Sale that was made pursuant to and in
compliance with Section 1.8 of Annex 1 or (ii) a disposition of assets that does
not constitute an Asset Sale; (e) any Investments received solely in exchange
for the issuance of Equity Interests (other than Disqualified Stock) of the
Parent; (f) loans or advances to owner-operators and employees of the Parent or
its Restricted Subsidiaries made in the ordinary course of business; (g)
Investments in an amount not to exceed $5.0 million in Haul Insurance to the
extent required by applicable laws or regulations or pursuant to any directive
or request (whether or not having the force of law) of any governmental
authority having jurisdiction over Haul Insurance; (h) Investments received in
connection with the settlement of any ordinary course obligations owed to the
Parent or any of its Restricted Subsidiaries; (i) other Investments in
businesses related to the businesses operated by the Parent and its Restricted
Subsidiaries in an aggregate amount not to exceed $30.0 million, provided that
the aggregate amount of such Investments shall not exceed $15.0 million in any
calendar year; and (j) investments by the Parent or a Restricted Subsidiary of
the Parent in a Receivables Subsidiary or any Investment by a Receivables
Subsidiary in any other Person or assets in connection with a Qualified
Receivables Transaction, provided that any Investment in any such Person is in
the form of a Purchase Money Note, an
9
equity interest or interests in accounts receivable generated by the Parent or a
Subsidiary of the Parent and transferred to any Person in connection with a
Qualified Receivables Transaction or any such Person owning such accounts
receivable.
"Permitted Liens" means (a) Liens in favor of the Parent or any of its
Restricted Subsidiaries; (b) Liens securing Obligations incurred pursuant to
clause (i) of the second paragraph of Section 1.7 of Annex 1; (c) Liens on
property or Equity Interests of a Person existing at the time such Person is
merged into or consolidated with the Parent or any Restricted Subsidiary of the
Parent, provided that such Liens were in existence prior to the contemplation of
such merger or consolidation and do not extend to any assets or Equity Interests
other than those of the Person merged into or consolidated with the Parent; (d)
Liens on property existing at the time of acquisition thereof by the Parent or
any Restricted Subsidiary of the Parent, provided that such Liens were in
existence prior to the contemplation of such acquisition; (e) Liens to secure
the performance of statutory obligations, surety or appeal bonds, performance
bonds or other obligations of a like nature incurred in the ordinary course of
business; (f) Liens to secure Indebtedness (including Capital Lease Obligations)
permitted by clause (v) of the second paragraph of Section 1.7 of Annex 1
covering only the assets acquired with such Indebtedness; (g) Liens existing on
the Closing Date; (h) Liens for taxes, assessments or governmental charges or
claims that are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently concluded, provided
that any reserve or other appropriate provision as shall be required in
conformity with GAAP shall have been made therefore; (i) Liens securing the
Subordinated Term Loan D Notes or any Guaranty thereof, (j) Liens securing
Permitted Refinancing Indebtedness to the extent that the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded was permitted to
be secured by a Lien; (k) Liens on Investments of the Parent or any of its
Restricted Subsidiaries in any Person that is not a Restricted Subsidiary of the
Parent to secure the Indebtedness of such Person; (l) Liens incurred in the
ordinary course of business of the Parent or any Restricted Subsidiary of the
Parent with respect to obligations that do not exceed $2.0 million at any one
time outstanding and that (i) are not incurred in connection with the borrowing
of money or the obtaining of advances or credit (other than trade credit in the
ordinary course of business) and (ii) do not in the aggregate materially detract
from the value of the property or materially impair the use thereof in the
operation of business by the Parent or such Restricted Subsidiary; and (m) Liens
on assets of a Receivables Subsidiary securing Indebtedness incurred in
connection with a Qualified Receivables Transaction, provided that such
Indebtedness was incurred in connection with such Qualified Receivables
Transaction.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Parent or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of the Parent or any of its Restricted Subsidiaries,
provided that: (a) the principal amount (or accredit value, if applicable) of
such Permitted Refinancing Indebtedness does not exceed
10
the principal amount of (or accredit value, if applicable), plus premium and
accrued interest on, the Indebtedness so extended, refinanced, renewed,
replaced, defeased or refunded (plus the amount of reasonable expenses incurred
in connection therewith); (b) such Permitted Refinancing Indebtedness has a
final maturity date later than the final maturity date of, and has Weighted
Average Life to Maturity of, the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded; (c) if the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded is subordinated in right of
payment to the Subordinated Term Loan D Notes, such Permitted Refinancing
Indebtedness is subordinated in right of payment to the Subordinated Term Loan D
Notes on terms at least as favorable to the Holders as those contained in the
documentation governing the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded; and (d) such Indebtedness is incurred either by
the Parent or by the Restricted Subsidiary that is an obligor on the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock Parent, trust, unincorporated organization or
government or agency or political subdivision thereof (including any subdivision
or ongoing business of any such entity or substantially all of the assets of any
such entity, subdivision or business).
"Principals" means the directors and the executive offices of the
Parent on the Effective Date and their spouses, lineal descendants, and trusts
or similar entities established for the benefit of such individuals.
"Purchase Money Note" means a promissory note evidencing a line of
credit, which may be irrevocable, from, or evidencing other Indebtedness owed
to, the Parent or any Subsidiary of the Parent in connection with a Qualified
Receivables Transaction, which note shall be repaid from cash available to the
maker of such note, other than amounts required to be established as reserves
pursuant to agreements, amounts paid to investors in respect of interest,
principal and other amounts owing to such investors and amounts paid in
connection with the purchase of newly generated receivables.
"Purchaser" shall mean John Hancock Life Insurance Company (formerly
John Hancock Mutual Life Insurance Company) and The Northwestern Mutual Life
Insurance Company.
"Qualified Receivables Transaction" means any transaction or series of
transactions that may be entered into by the Parent or any Subsidiary of the
Parent pursuant to which the Parent or any Subsidiary of the Parent may sell,
convey or otherwise transfer to (a) a Receivables Subsidiary (in the case of a
transfer by the Parent or any Subsidiary of the Parent) and (b) any other person
(in the case of a transfer by a Receivables Subsidiary), or may grant a security
interest in, any accounts receivable
11
(whether now existing or arising in the future) of the Parent or any Subsidiary
of the Parent, and any assets related thereto including, without limitation, all
collateral securing such accounts receivable, all contracts and all guarantees
or other obligations in respect of such accounts receivable, proceeds of such
accounts receivable and other assets which are customarily transferred or in
respect of which security interests are customarily granted in connection with
asset securitization transactions involving accounts receivable.
"Receivables Subsidiary" means a Wholly Owned Subsidiary of the Parent
(other than a Guarantor), which engages in no activities other than in
connection with the financing of accounts receivable and which is designated by
the Board of Directors of the Parent (as provided below) as a Receivables
Subsidiary (a) no portion of the Indebtedness or any other obligations
(contingent or otherwise) relating thereto of which (i) is guaranteed by the
Parent or any other Subsidiary of the Parent (excluding guarantees of
obligations relating thereto (other than the principal of, and interest on,
Indebtedness)) pursuant to Standard Securitization Undertakings, (ii) is
recourse to or obligates the Parent or any other Subsidiary of the Parent in any
way other than pursuant to Standard Securitization Undertakings or (iii)
subjects any property or asset of the Parent or any other Subsidiary of the
Parent, directly or indirectly, contingently or otherwise, to the satisfaction
thereof, other than pursuant to Standard Securitization Undertakings, (b) with
which neither the Parent nor any other Subsidiary of the Parent has any material
contract, agreement, arrangement or understanding (except in connection with a
Purchase Money Note or Qualified Receivables Transaction) other than on terms no
less favorable to the Parent or such other Subsidiary of the Parent than those
that might be obtained at the time from persons that are not Affiliates of the
Parent, other than fees payable in the ordinary course of business in connection
with servicing accounts receivable, and (c) to which neither the Parent nor any
other Subsidiary of the Parent has any obligation to maintain or preserve such
entity's financial condition or cause such entity to achieve certain levels of
operating results. Any such designation by the Board of Directors of the Parent
shall be evidenced to the Trustee by delivering to the Holders a certified copy
of the resolution of the Board of Directors of the Parent giving effect to such
designation and an Officers' Certificate certifying, to the best of such
officer's knowledge and belief after consulting with counsel, that such
designation complied with the foregoing conditions. For purposes of this
definition of Receivables Subsidiary, "obligations" means any principal,
interest, penalties, fees, indemnifications, reimbursements, damages and other
liabilities payable under the documentation governing any Indebtedness.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Payment" has the meaning set forth in Section 1.5 of Annex
1.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.
12
"Rigs" means specialized tractor-trailers used to haul automobiles and
light trucks.
"Security" shall have the same meaning as in Section 2(1) of the
Securities Act of 1933, as amended.
"Senior Indebtedness Covenant Event of Default" means any failure by
the Parent to comply with any covenants from time to time applicable to Senior
Indebtedness Liabilities that gives a holder of Senior Indebtedness Liabilities
the immediate right to accelerate such Senior Indebtedness Liabilities, provided
that any requirements for the giving of notice or passage of time as conditions
to such acceleration shall have been satisfied.
"Senior Indebtedness Liabilities" means all Obligations other than the
Subordinated Indebtedness Liabilities, whether such Obligations arise before,
during or after the initial or any renewal term of this Agreement or are
amended, restated, modified, renewed, refunded, refinanced or otherwise replaced
in whole or in part, whether prior to or after the commencement of any
Insolvency Proceeding, or arise after the commencement of any Insolvency
Proceeding with respect to the Loan Parties (and including, without limitation,
the payment of interest (including post-default interest and interest on
interest) and fees which would accrue and become due but for the commencement of
such Insolvency Proceeding, expense reimbursements and indemnities whether or
not such interest, fees, expense, reimbursements and indemnities are allowed or
allowable in whole or in party in any such Insolvency Proceeding).
"Senior Indebtedness Payment Default" means any default by the Parent
in the making of any payment or mandatory prepayment of principal or interest
with respect to any Senior Indebtedness Liabilities.
"Senior Notes" means the 8 5/8% Senior Notes due 2007 issued pursuant
to the Indenture.
"Standard Securitization Undertakings" means representations,
warranties, covenants and indemnities entered into by the Parent or any
Subsidiary of the Parent which are reasonably customary in an accounts
receivable transaction.
"Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Subordinated Indebtedness Liabilities" means all Obligations with
respect to the Subordinated Term Loan D Notes (including, without limitation,
the principal thereof, the
13
interest thereon, and the fees and expenses specifically related thereto, but
excluding any fees, expense reimbursement, indemnities and other amounts due to
the Collateral Agent).
"Subordinated Term Loan D Default" means any event that is or with the
passage of time or the giving of notice or both would be a Subordinated Term
Loan D Event of Default.
"Subordinated Term Loan D Event of Default" has the meaning set forth
in Section 2.1 of Annex 2.
"Subordinated Term D Loan Note Register" has the meaning set forth in
Section 5.1 of Annex 5.
"Subordinated Term D Loan Notes" means the Subordinated Term Loan D
Notes issued pursuant to this Agreement.
"Subsidiary" means, with respect to any Person, (a) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person (or a combination
thereof) and (b) any partnership (i) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person or (ii)
the only general partners of which are such Person or of one or more
Subsidiaries of such Person (or any combination thereof).
"Subsidiary Guarantees" means the guarantees of the Senior Notes
pursuant to the Indenture.
"Subsidiary Guarantors" means the guarantors of the Senior Notes
pursuant to the Indenture.
"Unrestricted Subsidiary" means any Subsidiary that is designated by
the Board of Directors as an Unrestricted Subsidiary pursuant to a Board
resolution, but only to the extent that such Subsidiary (a) has no Indebtedness
other than Limited-Recourse Debt, (b) is not party to any agreement, contract,
arrangement or understanding with the Parent or any Restricted Subsidiary of the
Parent unless the terms of any such agreement, contract, arrangement or
understanding comply with Section 1.9 of Annex 1 and (c) except to the extent
permitted by Section 1.5 of Annex 1, is a Person with respect to which neither
the Parent nor any of its Restricted Subsidiaries has any direct or indirect
obligation (i) to subscribe for additional Equity Interests or (ii) to maintain
or preserve such Person's financial condition or to cause such Person to achieve
any specified levels of operating results. As of the Effective Date, Haul
Insurance and all Subsidiaries that
14
are "Unrestricted Subsidiaries" under the Indenture (as of such date) shall be
Unrestricted Subsidiaries hereunder.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (a) the sum
of the products obtained by multiplying (i) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (ii) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (b) the then outstanding principal
amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a Restricted
Subsidiary of such Person all of the outstanding Capital Stock or other
ownership interests of which (other than directors' qualifying shares) shall at
the time be owned by such Person or by one or more Wholly Owned Restricted
Subsidiaries of such Person and one or more Wholly Owned Restricted Subsidiaries
of such Person.
Section 4.2. Reference to Agreement. Except where expressly
defined in this Annex 4, terms defined in Section 1.01 of Article I of the
Agreement shall have the meanings specified therein. The provisions of Section
1.02, 1.03 and 1.04 of Article I of the Agreement are also incorporated herein
by reference as if set forth herein.
15
ANNEX 5
MISCELLANEOUS
Section 5.1 Registered Subordinated Term Loan D Notes. The Parent
shall cause to be kept at its principal office a register for the registration
and transfer of the Subordinated Term Loan D Notes (hereinafter called the
"Subordinated Term Loan D Note Register"), and the Parent will register or
transfer or cause to be registered or transferred as hereinafter provided any
Subordinated Term Loan D Note issued pursuant to this Agreement.
At any time and from time to time any Holder of a Subordinated Term
Loan D Note which has been duly registered as hereinabove provided may transfer
such Subordinated Term Loan D Note upon surrender thereof at the principal
office of the Parent duly endorsed or accompanied by a written instrument of
transfer duly executed by the Holder or its attorney duly authorized in writing.
The Person in whose name any registered Subordinated Term Loan D Note
shall be registered shall be deemed and treated as the owner and holder thereof
and a Holder for all purposes of this Agreement. Payment of or on account of the
principal, premium, if any, and interest on any registered Subordinated Term
Loan D Note shall be made to or upon the written order of such Holder.
Section 5.2 Exchange of Subordinated Term Loan D Notes. At any
time and from time to time, upon not less than ten days' notice to that effect
given by the Holder of any Subordinated Term Loan D Note initially delivered or
of any Subordinated Term Loan D Note substituted therefor pursuant to Section
5.1 of this Annex, this Section 5.2 or Section 5.3 of this Annex, and, upon
surrender of such Subordinated Term Loan D Note at its office, the Parent will
deliver in exchange therefor, without expense to such Holder, except as set
forth below, a Subordinated Term Loan D Note for the same aggregate principal
amount as the then unpaid principal amount of the Subordinated Term Loan D Note
so surrendered, or Subordinated Term Loan D Notes in the denomination of
$100,000 or any amount in excess thereof as such Holder shall specify, dated as
of the date to which interest has been paid on the Subordinated Term Loan D Note
so surrendered or, if such surrender is prior to the payment of any interest
thereon, then dated as of the date of issue, registered in the name of such
Person or Persons as may be designated by such Holder, and otherwise of the same
form and tenor as the Subordinated Term Loan D Notes so surrendered for
exchange. The Parent may require the payment of a sum sufficient to cover any
stamp tax or governmental charge imposed upon such exchange or transfer.
Section 5.3 Loss, Theft, Etc. of Subordinated Term Loan D Notes.
Upon receipt of evidence satisfactory to the Parent of the loss, theft,
mutilation or destruction of any
Subordinated Term Loan D Note, and in the case of any such loss, theft or
destruction upon delivery of a bond of indemnity in such form and amount as
shall be reasonably satisfactory to the Parent, or in the event of such
mutilation upon surrender and cancellation of the Subordinated Term Loan D Note,
the Parent will make and deliver without expense to the Holder thereof, a new
Subordinated Term Loan D Note, of like tenor, in lieu of such lost, stolen,
destroyed or mutilated Subordinated Term Loan D Note. If an Institutional Holder
is the owner of any such lost, stolen or destroyed Subordinated Term Loan D
Note, then the affidavit of an authorized officer of such owner, setting forth
the fact of loss, theft or destruction and of its ownership of such Subordinated
Term Loan D Note at the time of such loss, theft or destruction shall be
accepted as satisfactory evidence thereof and no further indemnity shall be
required as a condition to the execution and delivery of a new Subordinated Term
Loan D Note other than the written agreement of such owner to indemnify the
Parent.
Section 5.4 Direct Payment. Notwithstanding anything to the
contrary contained in this Agreement or the Subordinated Term Loan D Notes, in
the case of any Subordinated Term Loan D Note owned by any Holder that is a
Purchaser or any other Institutional Holder which has given written notice to
the Parent requesting that the provisions of this Section 5.4 shall apply, the
Parent will punctually pay when due the principal thereof, interest thereon and
premium, if any, due with respect to said principal, without any presentment
thereof directly to such Holder at its address set forth herein or such other
address as such Holder may from time to time designate in writing to the Parent
or, if a bank account with a United States bank is so designated for such
Holder, the Parent will make such payments in immediately available funds to
such bank account, marked for attention as indicated, or in such other manner or
to such other account in any United States bank as such Holder may from time to
time direct in writing.
Section 5.5 Payments Due on Non-Business Days. Anything in this
Agreement or the Subordinated Term Loan D Notes to the contrary notwithstanding,
any payment of principal of or interest on any Subordinated Term Loan D Note
that is due on a date other than a Business Day shall be made on the next
succeeding Business Day without including the additional days elapsed in the
computation of the interest payable on such next succeeding Business Day.
Section 5.6 Repurchase of Subordinated Term Loan D Notes. The
Parent will not and will not permit any Control Affiliate to purchase or make
any offer to repurchase directly or indirectly, any of the outstanding
Subordinated Term Loan D Notes except pursuant to an offer to purchase made by
the Parent or a Control Affiliate pro rata to the Holders of all Subordinated
Term Loan D Notes at the time outstanding upon the same terms and conditions.
Any such offer shall remain open for at least 10 Business Days. If the Holders
of more than 25% of the principal amount of the Subordinated Term Loan D Notes
then outstanding accept such offer, the Parent shall promptly notify the
remaining Holders of such fact and the expiration date for the acceptance by
Holders of
2
Subordinated Term Loan D Notes of such offer shall be extended by the number of
days necessary to give each such remaining Holder at least 5 Business Days from
its receipt of such notice to accept such offer. The Parent or any Control
Affiliate may withdraw any such offer at any time prior to purchase for any
reason. Any Subordinated Term Loan D Note so acquired by the Parent or any
Control Affiliate shall be deemed cancelled and no longer outstanding for the
purposes of any payment, distribution or voting provision hereof.
Section 5.7 Prepayment Upon Change of Control. In the event the
Parent has knowledge of a Change of Control or an impending Change of Control,
the Parent will give written notice (a "Control Change Notice") of such fact to
all Holders at least 60 days prior to any proposed Change of Control Date,
provided that if the Parent shall not then have knowledge of such fact, such
Control Change Notice shall be delivered promptly upon receipt of such
knowledge, but in no event later than three Business Days after the Change of
Control Date. The Control Change Notice shall (i) describe the facts and
circumstances of such Change of Control (including the Change of Control Date or
proposed Change of Control Date) in reasonable detail, (ii) make reference to
this Section 5.7 and the rights of the Holders to require the Parent to prepay
their Subordinated Term Loan D Notes on the terms and conditions provided for
herein, (iii) state that the Holder must make a declaration of its intent to
have the Subordinated Term Loan D Notes held by it prepaid, and (iv) specify the
date by which the Holder must respond to such Control Change Notice pursuant to
this Section 5.7 in order to make such declaration.
Upon the receipt of such Control Change Notice or, if no Control Change
Notice is given, upon receipt of actual knowledge of a Change of Control, the
Holder of any Subordinated Term Loan D Notes shall have the privilege, upon
written notice (the "Declaration Notice") to the Parent, of declaring all
Subordinated Term Loan D Notes held by such Holder serving such Declaration
Notice to become due and payable and thereupon such Subordinated Term Loan D
Notes shall become due and payable on such date (the "Control Change Payment
Date") as the Parent shall specify in a written notice delivered to such Holder,
which notice shall be delivered by the Parent to such Holder not later than 20
days prior to the Control Change Payment Date. The Control Change Payment Date
shall be not later than 30 days after the Change of Control Date, in the event
that such Declaration Notice is served on or prior to the Change of Control
Date, or 30 days after the date such Declaration Notice is served, if such
Declaration Notice is not served on or prior to the Change of Control Date. The
Parent covenants and agrees to prepay in full on the Control Change Payment Date
all Subordinated Term Loan D Notes held by such Holder serving such Declaration
Notice to the Parent. In the event that a Control Change Notice has in fact been
given as hereinabove required, such Declaration Notice shall be served prior to
60 days after receipt of such Control Change Notice, and in the event that a
Control Change Notice has not been given as hereinabove required, such
Declaration Notice shall be served prior to 30 days after the Holder serving
such Declaration Notice shall have actual knowledge of such Change of Control.
In the event
3
that a Control Change Notice is given and a Holder fails to provide a
Declaration Notice within the time period set forth above, the Subordinated Term
Loan D Notes held by such Holder shall not become due and payable as a result of
such Change of Control.
In the event that any Holder shall have declared all of the
Subordinated Term Loan D Notes held thereby to become due and payable pursuant
to this Section 5.7, then the Parent shall promptly, but in any event within 15
days after the receipt of the Declaration Notice, deliver written notice of such
declaration to each other Holder and, notwithstanding the provisions of the
immediately preceding paragraph, the right of each such other Holder to declare
all of the Subordinated Term Loan D Notes held thereby to become due and payable
pursuant to this Section 5.7 shall remain in effect until the later to occur of
(i) 60 days after receipt by such Holders of the Control Change Notice and (ii)
30 days after receipt by such Holders of the notice required to be delivered
pursuant to this paragraph, provided that the provisions of this paragraph shall
only apply with respect to notices required to be delivered pursuant to this
paragraph to the extent that such notices relate to declarations made by Holders
prior to the expiration of the periods specified in the immediately preceding
paragraph.
As used herein, the term "Change of Control Date" shall mean any date
upon which a Change of Control shall occur.
All prepayments on the Subordinated Term Loan D Notes pursuant to this
Section 5.7 shall be made by the payment of the aggregate principal amount
remaining unpaid on such Subordinated Term Loan D Notes and accrued interest
thereon to the date of such prepayment.
Section 5.8 Expenses, Stamp Tax Indemnity. Whether or not the
transactions herein contemplated shall be consummated, the Parent agrees to pay
directly all of the Purchasers' out-of-pocket expenses in connection with the
preparation, execution and delivery of this Agreement and the transactions
contemplated hereby, including but not limited to the reasonable charges and
disbursements of Debevoise & Plimpton, special counsel to the Purchasers,
duplicating and printing costs and charges for shipping the Subordinated Term
Loan D Notes, adequately insured to each Purchaser's home office or at such
other place as such Purchaser may designate, and all such expenses of the
Holders relating to any amendment, waivers or consents pursuant to the
provisions hereof, including, without limitation, any amendments, waivers, or
consents resulting from any work-out, renegotiation or restructuring relating to
the performance by the Parent of its obligations under this Agreement and the
Subordinated Term Loan D Notes. The Parent also agrees that it will pay and save
each Purchaser harmless against any and all liability with respect to stamp and
other taxes, if any, which may be payable or which may be determined to be
payable in connection with the execution and delivery of this Agreement or the
Subordinated Term Loan D Notes, whether or not any Subordinated Term Loan D
Notes are then outstanding. The Parent agrees to protect and indemnify
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each Purchaser against any liability for any and all brokerage fees and
commissions payable or claimed to be payable to any Person in connection with
the transactions contemplated by this Agreement.
Section 5.9 Powers and Rights Not Waived; Remedies Cumulative.
No delay or failure on the part of any Holder in the exercise of any power or
right shall operate as a waiver thereof; nor shall any single or partial
exercise of the same preclude any other or further exercise thereof, or the
exercise of any other power or right, and the rights and remedies of each Holder
are cumulative to, and are not exclusive of, any rights or remedies any such
Holder would otherwise have.
Section 5.10 Survival of Covenants and Representations. All
covenants contained in Annex 1 and all representations and warranties made by
the Parent herein and in any certificates hereinafter delivered pursuant hereto
(which representations and warranties shall be, and be deemed to be, made only
as of the date given and shall not be, or be deemed to be, made or repeated on,
or as of, any later date), whether or not in connection with the Effective Date,
shall survive the closing and the delivery of this Agreement and the
Subordinated Term Loan D Notes.
Section 5.11 Notices. All communications provided for hereunder
shall be in writing and, if to a Holder, delivered or mailed prepaid by
registered or certified mail or overnight air courier, or by facsimile
communication, in each case addressed to such Holder at its address appearing
beneath its signature at the foot of this Agreement or such other address as any
Holder may designate to the Parent in writing, and if to the Parent, delivered
or mailed by registered or certified mail or overnight air courier, or by
facsimile communication, to the Parent at the address beneath its signature at
the foot of this Agreement or to such other address as the Parent may in writing
designate to the Holders, provided, however, that a notice to a Holder by
overnight air courier shall only be effective if delivered to such Holder at a
street address designated for such purpose in accordance with this Section 5.11,
and a notice to such Holder by facsimile communication shall only be effective
if made by confirmed transmission to such Holder at a telephone number
designated for such purpose in accordance with this Section 5.9 and promptly
followed by the delivery of such notice by registered or certified mail or
overnight air courier, as set forth above.
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