EXHIBIT 10.1
PUBLISHED CUSIP NUMBERS:
371533AA8 (Deal)
371533AB6 (Revolving Commitment)
371533AC4 (Term Loan A)
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CREDIT AGREEMENT
Dated as of April 1, 2004
among
GENESCO INC.
as the Borrower
Certain Subsidiaries of the Borrower
from time to time party hereto
as Guarantors
BANK OF AMERICA, N.A.
as Administrative Agent and L/C Issuer
and
The Other Lenders Party Hereto
BANC OF AMERICA SECURITIES LLC
as
Sole Lead Arranger and Sole Book Manager
LASALLE BANK NATIONAL ASSOCIATION
as Syndication Agent
WELLS FARGO FOOTHILL, LLC
as Documentation Agent
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TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS AND ACCOUNTING TERMS.................................................................... 1
1.01 Defined Terms............................................................................... 1
1.02 Other Interpretive Provisions............................................................... 32
1.03 Accounting Terms............................................................................ 32
1.04 Rounding.................................................................................... 33
1.05 References to Agreements and Laws........................................................... 33
1.06 Exchange Rates; Currency Equivalents........................................................ 33
1.07 Additional Alternative Currencies........................................................... 34
1.08 Change of Currency.......................................................................... 34
1.09 Times of Day................................................................................ 35
1.10 Letter of Credit Amounts.................................................................... 35
ARTICLE II THE COMMITMENTS AND CREDIT EXTENSIONS.............................................................. 35
2.01 Loans....................................................................................... 35
2.02 Borrowings, Conversions and Continuations of Loans.......................................... 36
2.03 Letters of Credit........................................................................... 37
2.04 Prepayments................................................................................. 47
2.05 Termination or Reduction of Aggregate Revolving Commitments................................. 49
2.06 Repayment of Loans.......................................................................... 50
2.07 Interest.................................................................................... 51
2.08 Fees........................................................................................ 52
2.09 Computation of Interest and Fees............................................................ 53
2.10 Evidence of Debt............................................................................ 53
2.11 Payments Generally.......................................................................... 53
2.12 Sharing of Payments......................................................................... 55
ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY............................................................ 56
3.01 Taxes....................................................................................... 56
3.02 Illegality.................................................................................. 57
3.03 Inability to Determine Rates................................................................ 57
3.04 Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurodollar Rate Loans...... 58
3.05 Compensation for Losses..................................................................... 58
3.06 Matters Applicable to all Requests for Compensation......................................... 59
3.07 Survival.................................................................................... 59
ARTICLE IV GUARANTY........................................................................................... 60
4.01 The Guaranty................................................................................ 60
4.02 Obligations Unconditional................................................................... 60
4.03 Reinstatement............................................................................... 61
4.04 Certain Additional Waivers.................................................................. 62
4.05 Remedies.................................................................................... 62
4.06 Rights of Contribution...................................................................... 62
4.07 Guarantee of Payment; Continuing Guarantee.................................................. 62
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ARTICLE V CONDITIONS PRECEDENT TO CREDIT EXTENSIONS........................................................... 62
5.01 Conditions of Closing Date and Initial Credit Extension..................................... 62
5.02 Conditions to all Credit Extensions......................................................... 68
ARTICLE VI REPRESENTATIONS AND WARRANTIES..................................................................... 69
6.01 Existence, Qualification and Power; Compliance with Laws.................................... 69
6.02 Authorization; No Contravention............................................................. 70
6.03 Governmental Authorization; Other Consents.................................................. 70
6.04 Binding Effect.............................................................................. 70
6.05 Financial Statements; No Material Adverse Effect............................................ 70
6.06 Litigation.................................................................................. 71
6.07 No Default.................................................................................. 71
6.08 Ownership of Property; Liens................................................................ 72
6.09 Environmental Compliance.................................................................... 72
6.10 Insurance................................................................................... 73
6.11 Taxes....................................................................................... 73
6.12 ERISA Compliance............................................................................ 73
6.13 Capital Structure/Subsidiaries.............................................................. 74
6.14 Margin Regulations; Investment Company Act; Public Utility Holding Company Act.............. 75
6.15 Disclosure.................................................................................. 75
6.16 Compliance with Laws........................................................................ 75
6.17 Intellectual Property....................................................................... 75
6.18 Solvency.................................................................................... 76
6.19 Investments................................................................................. 76
6.20 Business Locations.......................................................................... 76
6.21 Brokers' Fees............................................................................... 76
6.22 Labor Matters............................................................................... 76
6.23 Nature of Business.......................................................................... 76
6.24 Representations and Warranties from Other Loan Documents.................................... 77
6.25 Representations and Warranties from Merger Agreement........................................ 77
6.26 Collateral Documents........................................................................ 77
6.27 Designation as "Designated Senior Indebtedness"............................................. 77
6.28 Use of Proceeds............................................................................. 77
ARTICLE VII AFFIRMATIVE COVENANTS............................................................................. 77
7.01 Financial Statements........................................................................ 78
7.02 Certificates; Other Information............................................................. 78
7.03 Notices and Information..................................................................... 80
7.04 Payment of Obligations...................................................................... 81
7.05 Preservation of Existence, Etc.............................................................. 81
7.06 Maintenance of Properties................................................................... 82
7.07 Maintenance of Insurance.................................................................... 82
7.08 Compliance with Laws and Material Contractual Obligations................................... 82
7.09 Books and Records........................................................................... 83
7.10 Inspection Rights........................................................................... 83
7.11 Use of Proceeds............................................................................. 83
7.12 Additional Guarantors....................................................................... 83
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7.13 Pledged Assets.............................................................................. 84
ARTICLE VIII NEGATIVE COVENANTS............................................................................... 85
8.01 Liens....................................................................................... 85
8.02 Investments................................................................................. 87
8.03 Indebtedness................................................................................ 90
8.04 Fundamental Changes......................................................................... 92
8.05 Dispositions................................................................................ 92
8.06 Restricted Payments......................................................................... 93
8.07 Change in Nature of Business................................................................ 93
8.08 Transactions with Affiliates and Insiders................................................... 93
8.09 Burdensome Agreements....................................................................... 94
8.10 Use of Proceeds............................................................................. 94
8.11 Financial Covenants......................................................................... 95
8.12 Capital Expenditures........................................................................ 95
8.13 Prepayment of Other Indebtedness, Etc....................................................... 96
8.14 Organization Documents; Fiscal Year......................................................... 96
8.15 Ownership of Subsidiaries................................................................... 96
8.16 Sale Leasebacks............................................................................. 97
ARTICLE IX EVENTS OF DEFAULT AND REMEDIES..................................................................... 97
9.01 Events of Default........................................................................... 97
9.02 Remedies Upon Event of Default.............................................................. 100
9.03 Application of Funds........................................................................ 100
ARTICLE X ADMINISTRATIVE AGENT................................................................................ 101
10.01 Appointment and Authorization of Administrative Agent....................................... 101
10.02 Delegation of Duties........................................................................ 102
10.03 Liability of Administrative Agent........................................................... 102
10.04 Reliance by Administrative Agent............................................................ 102
10.05 Notice of Default........................................................................... 103
10.06 Credit Decision; Disclosure of Information by Administrative Agent.......................... 103
10.07 Indemnification of Administrative Agent..................................................... 104
10.08 Administrative Agent in its Individual Capacity............................................. 104
10.09 Successor Administrative Agent.............................................................. 105
10.10 Administrative Agent May File Proofs of Claim............................................... 105
10.11 Collateral and Guaranty Matters............................................................. 106
10.12 Other Agents; Arrangers and Managers........................................................ 107
ARTICLE XI MISCELLANEOUS...................................................................................... 107
11.01 Amendments, Etc............................................................................. 107
11.02 Notices and Other Communications; Facsimile Copies.......................................... 109
11.03 No Waiver; Cumulative Remedies.............................................................. 110
11.04 Attorney Costs, Expenses and Taxes.......................................................... 110
11.05 Indemnification by the Borrower............................................................. 111
11.06 Payments Set Aside.......................................................................... 112
11.07 Successors and Assigns...................................................................... 112
11.08 Confidentiality............................................................................. 115
11.09 Set-off..................................................................................... 116
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11.10 Interest Rate Limitation.................................................................... 116
11.11 Counterparts................................................................................ 117
11.12 Integration................................................................................. 117
11.13 Survival of Representations and Warranties.................................................. 117
11.14 Severability................................................................................ 117
11.15 Tax Forms................................................................................... 118
11.16 Replacement of Lenders...................................................................... 120
11.17 Governing Law............................................................................... 120
11.18 Waiver of Right to Trial by Jury............................................................ 121
11.19 USA PATRIOT Act Notice...................................................................... 121
11.20 Designation as Designated Senior Indebtedness............................................... 121
11.21 Judgment Currency........................................................................... 121
SIGNATURES.................................................................................................... S-1
SCHEDULES
1.01-1 Guarantors
1.01-3 Existing Letters of Credit
1.01-2 Add-backs to Consolidated EBITDA
2.01 Commitments and Pro Rata Shares
6.03 Required Consents, Authorizations, Notices and Filings
6.06 Litigation
6.09 Environmental Matters
6.10 Insurance
6.11 Taxes
6.12 ERISA
6.13(a) Corporate Structure
6.13(b) Subsidiaries
6.13(c) Equity Investments
6.17 Intellectual Property Matters
6.20(a) Real Properties
6.20(b) Collateral Locations
6.20(c) Chief Executive Office, Jurisdiction of Incorporation,
Principal Place of Business
8.01 Existing Liens
8.02 Existing Investments
8.03 Existing Indebtedness
11.02 Administrative Agent's Office, Certain Addresses for
Notices
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EXHIBITS
A Form of Loan Notice
B-1 Form of Revolving Note
B-2 Form of Term Note
C Form of Compliance Certificate
D Form of Joinder Agreement
E Form of Assignment and Assumption
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CREDIT AGREEMENT
This CREDIT AGREEMENT (as amended, modified, restated or supplemented
from time to time, the "Agreement") is entered into as of April 1, 2004 by and
among GENESCO INC., a Tennessee corporation (together with any permitted
successors and assigns, the "Borrower"), the Guarantors (as defined herein), the
Lenders (as defined herein), and BANK OF AMERICA, N.A., as Administrative Agent
and L/C Issuer.
The Borrower has requested that the Lenders provide credit facilities
in an aggregate amount of $175,000,000 (the "Credit Facilities") for the
purposes hereinafter set forth, and the Lenders are willing to do so on the
terms and conditions set forth herein.
In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01 DEFINED TERMS.
As used in this Agreement, the following terms shall have the meanings
set forth below:
"Acquired Company" means Hat World Corporation, a Delaware corporation.
"Acquisition", by any Person, means the acquisition by such Person, in
a single transaction or in a series of related transactions, of all of the
Capital Stock or all or substantially all of the Property, or a business unit or
product line, of another Person, whether or not involving a merger or
consolidation with such other Person and whether for cash, property, services,
assumption of Indebtedness, securities or otherwise.
"Administrative Agent" means Bank of America in its capacity as
administrative agent under this Agreement and certain of the other Loan
Documents, or any successor administrative agent.
"Administrative Agent's Office" means the Administrative Agent's
address and, as appropriate, account as set forth on Schedule 11.02, or such
other address or account as the Administrative Agent may from time to time
notify the Borrower and the Lenders.
"Administrative Questionnaire" means an Administrative Questionnaire in
a form supplied by the Administrative Agent.
"Affiliate" means, with respect to any Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified. "Control"
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise. "Controlling" and
"Controlled" have meanings correlative thereto. Without limiting the generality
of the foregoing, a Person shall be deemed to be Controlled by another Person if
such other Person possesses, directly or indirectly, power to vote ten percent
(10%) or more of the securities having ordinary voting power for the election of
directors, managing general partners or the equivalent.
"Agent-Related Persons" means the Administrative Agent, together with
its Affiliates (including, in the case of Bank of America in its capacity as the
Administrative Agent, the Arranger), and the officers, directors, employees,
agents and attorneys-in-fact of such Persons and Affiliates.
"Aggregate Revolving Commitments" means the Revolving Commitments of
all the Lenders. The initial amount of the Aggregate Revolving Commitments in
effect on the Closing Date is SEVENTY-FIVE MILLION DOLLARS ($75,000,000).
"Agreement" has the meaning assigned to such term in the heading
hereof.
"Alternative Currency" means Euro and Canadian Dollars and each other
currency (other than Dollars) that is approved in accordance with Section 1.07.
"Alternative Currency Equivalent" means, at any time, with respect to
any amount denominated in Dollars, the equivalent amount thereof in the
applicable Alternative Currency as determined by the Administrative Agent or the
L/C Issuer, as applicable, at such time on the basis of the Spot Rate
(determined as of the most recent Revaluation Date) for the purchase of such
Alternative Currency with Dollars.
"Alternative Currency Sublimit" means an amount equal to $2,500,000.
The Alternative Currency Sublimit is part of, and not in addition to, the
Standby Letter of Credit Sublimit and the Commercial Letter of Credit Sublimit.
"Applicable Rate" means, for the purposes of calculating (a) the Letter
of Credit Fees for the purposes of Section 2.03(i), (b) the interest rate
applicable to Eurodollar Rate Loans for the purposes of Section 2.07(a), (c) the
interest rate applicable to Base Rate Loans for the purposes of Section 2.07(a),
and (d) the Facility Fee for the purposes of Section 2.08(a),each of the
following percentages per annum, as applicable, based upon the ratio of
Consolidated Adjusted Debt to Consolidated EBITDAR as set forth in the most
recent Compliance Certificate received by the Administrative Agent pursuant to
Section 7.02(b) for the four-quarter period ending as of the last day of the
fiscal quarter to which such Compliance Certificate relates:
Applicable Margin for
Ratio of Applicable Margin for Alternate Base Rate
Consolidated Facility LIBOR Loans Loans
Adjusted Fee for ------------------------------------------------
Debt to Revolving Revolving Term Revolving Term Standby Commercial
Pricing Consolidated Credit Credit Loan Credit Loan Letter of Letter of
Level EBITDAR Facility Facility Facility Facility Facility Credit Fee Credit Fee
- -------------------------------------------------------------------------------------------------------------------
I > or = 4.00x 50.0 bps 175.0 bps 225.0 bps 0.0 bps 50.0 bps 175.0 bps 87.5 bps
- -------------------------------------------------------------------------------------------------------------------
2
II < 4.00x 50.0 bps 150.0 bps 200.0 bps 0.0 bps 25.0 bps 150.0 bps 75.0 bps
but > or = 3.50x
- ------------------------------------------------------------------------------------------------------------------
III < 3.50x 50.0 bps 125.0 bps 175.0 bps 0.0 bps 0.0 bps 125.0 bps 62.5 bps
Any increase or decrease in the Applicable Rates resulting from a change in the
ratio of Consolidated Adjusted Debt to Consolidated EBITDAR shall become
effective as of the first Business Day immediately following the date a
Compliance Certificate is delivered pursuant to Section 7.02(b); provided,
however, that if a Compliance Certificate is not delivered when due in
accordance with such Section, then Pricing Level I shall apply as of the first
Business Day after the date on which such Compliance Certificate was required to
have been delivered until the first Business Day after the date on which such
Compliance Certificate is delivered. Notwithstanding the foregoing, the
Applicable Rates in effect from the Closing Date through the date immediately
following the date the Borrower has delivered a Compliance Certificate for the
fiscal quarter ending on or about May 1, 2004 shall be set at the Applicable
Rates determined based upon Pricing Level I.
"Applicable Time" means, with respect to any borrowings and payments in
any Alternative Currency, the local time in the place of settlement for such
Alternative Currency as may be determined by the Administrative Agent or the L/C
Issuer, as the case may be, to be necessary for timely settlement on the
relevant date in accordance with normal banking procedures in the place of
payment.
"Application Period" means, in respect of the Net Cash Proceeds of any
Disposition other than an Excluded Disposition and/or the Excess Proceeds of any
Involuntary Disposition, the period of 270 days (or such earlier date as
provided for reinvestment of the proceeds thereof under the documents evidencing
or governing any Subordinated Indebtedness) following receipt of such Net Cash
Proceeds or Excess Proceeds by any Consolidated Party.
"Arranger" means Banc of America Securities LLC, in its capacity as
sole lead arranger and sole book manager.
"Assignment and Assumption" means an Assignment and Assumption
substantially in the form of Exhibit E.
"Attorney Costs" means and includes all reasonable fees, expenses and
disbursements of any law firm or other external counsel and, without
duplication, the reasonable allocated cost of internal legal services and all
expenses and disbursements of internal counsel.
"Attributable Indebtedness" means, on any date, (a) in respect of any
Capital Lease of any Person, the capitalized amount thereof that would appear as
debt on a balance sheet of such Person prepared as of such date in accordance
with GAAP, and (b) in respect of any Synthetic Lease Obligation, the capitalized
amount of the remaining lease payments under the relevant lease that would
appear as debt on a balance sheet of such Person prepared as of such date in
accordance with GAAP if such lease were accounted for as a Capital Lease.
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"Audited Financial Statements" means the audited consolidated balance
sheet of the Borrower and its Subsidiaries for the fiscal year ended January 31,
2004, and the related consolidated statements of income or operations,
shareholders' equity and cash flows for such fiscal year of the Borrower and its
Subsidiaries, including the notes thereto.
"Availability Period" means, with respect to the Revolving Commitments,
the period from and including the Closing Date to the earliest of (a) the
Maturity Date, (b) the date of termination of the Aggregate Revolving
Commitments pursuant to Section 2.05 and (c) the date of termination of the
commitment of each Lender to make Loans and of the obligation of the L/C Issuer
to make L/C Credit Extensions pursuant to Section 9.02.
"Bank of America" means Bank of America, N.A. and its successors.
"Bank of NY" has the meaning specified in Section 8.01(q).
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the United
States Code, as amended, modified, succeeded or replaced from time to time.
"Base Rate" means for any day a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest
in effect for such day as publicly announced from time to time by the
Administrative Agent as its "prime rate" (or if the Administrative Agent does
not announce a "prime rate", by Bank of America). The "prime rate" is a rate set
by the Administrative Agent (or if not set by the Administrative Agent, by Bank
of America) based upon various factors including the Administrative Agent's (or
Bank of America's, as applicable) costs and desired return, general economic
conditions and other factors, and is used as a reference point for pricing some
loans, which may be priced at, above, or below such announced rate. Any change
in such rate announced by the Administrative Agent (or Bank of America, as
applicable) shall take effect at the opening of business on the day specified in
the public announcement of such change.
"Base Rate Loan" means a Loan that bears interest based on the Base
Rate.
"Base Rate Revolving Loan" means a Revolving Loan that is a Base Rate
Loan.
"Borrower" has the meaning specified in the heading hereof.
"Borrowing" means a borrowing consisting of simultaneous Loans of the
same Type and, in the case of Eurodollar Rate Loans, having the same Interest
Period made by each of the Lenders pursuant to Section 2.01.
"Business Day" means any day other than a Saturday, Sunday or other day
on which commercial banks are authorized to close under the Laws of, or are in
fact closed in, the state where the Administrative Agent's Office is located
and, if such day relates to any Eurodollar Rate Loan, means any such day on
which dealings in Dollar deposits are conducted by and between banks in the
London interbank eurodollar market.
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"Businesses" means, at any time, a collective reference to the
businesses operated by the Consolidated Parties at such time.
"Canadian Dollars" means the lawful currency of Canada.
"Capital Lease" means, as applied to any Person, any lease of any
Property (whether real, personal or mixed) by that Person as lessee which, in
accordance with GAAP, is required to be accounted for as a capital lease on the
balance sheet of that Person.
"Capital Stock" means (i) in the case of a corporation, capital stock,
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
capital stock, (iii) in the case of a partnership, partnership interests
(whether general or limited), (iv) in the case of a limited liability company,
membership interests and (v) 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 Collateralize" has the meaning specified in Section 2.03(g)(iv).
"Cash Equivalents" means, as at any date, (a) securities issued or
directly and fully guaranteed or insured by the United States or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States is pledged in support thereof) having maturities of not more than twelve
months from the date of acquisition, (b) Dollar denominated time deposits and
certificates of deposit of (i) any Lender, (ii) any domestic commercial bank of
recognized standing having capital and surplus in excess of $500,000,000 or
(iii) any bank whose short-term commercial paper rating from S&P is at least A-1
or the equivalent thereof or from Moody's is at least P-1 or the equivalent
thereof (any such bank being an "Approved Bank"), in each case with maturities
of not more than 270 days from the date of acquisition, (c) commercial paper and
variable or fixed rate notes issued by any Approved Bank (or by the parent
company thereof) or any variable rate notes issued by, or guaranteed by, any
domestic corporation rated A-1 (or the equivalent thereof) or better by S&P or
P-1 (or the equivalent thereof) or better by Moody's and maturing within six
months of the date of acquisition, (d) repurchase agreements entered into by any
Person with a bank or trust company (including any of the Lenders) or recognized
securities dealer having capital and surplus in excess of $500,000,000 for
direct obligations issued by or fully guaranteed by the United States in which
such Person shall have a perfected first priority security interest (subject to
no other Liens) and having, on the date of purchase thereof, a fair market value
of at least 100% of the amount of the repurchase obligations and (e)
Investments, classified in accordance with GAAP as current assets, in money
market investment programs registered under the Investment Company Act of 1940,
as amended, which are rated AAA by either S&P or Moody's.
"Change of Control" means the occurrence of any of the following
events: (a) the sale, lease, transfer or other disposition (other than by way of
merger or consolidation), in one or a series of related transactions, of all or
substantially all of the assets of the Borrower and its Subsidiaries taken as a
whole to any "person" or "group" (within the meaning of Sections 13(d) and
14(d)(2) of the Securities Exchange Act of 1934), (b) the Borrower is liquidated
or dissolved or adopts a plan of liquidation or dissolution, (c) a "person" or
"group" (within the meaning of Sections 13(d) and 14(d)(2) of the Securities
Exchange Act of 1934) shall have acquired
5
beneficial ownership, directly or indirectly, of, or shall have acquired by
contract or otherwise, or shall have entered into a contract or arrangement
that, upon consummation, will result in its or their acquisition of, or control
over, 30% or more of the outstanding Voting Stock of the Borrower, (d) there
occurs a (i) "Change of Control" (or any comparable term) under, and as defined
in the Convertible Note Indenture, which in accordance therewith gives each
Convertible Noteholder the right to require the Borrower to repurchase the
Convertible Notes held by such Person and (ii) thereafter, with respect to the
Convertible Notes, any of the following occur: (1) the Borrower provides notice
to the Convertible Noteholders that it intends to pay in cash any portion of the
required purchase price for the Convertible Notes in an amount in excess of any
such cash payments otherwise permitted by Section 8.13 hereof; (2) the Borrower
fails to satisfy (or is unable to satisfy) any of the conditions precedent set
forth in the Convertible Note Indenture that would permit the Borrower to
exercise its right to pay in Capital Stock 100% (less any cash payment in an
amount not in excess of any amount otherwise permitted by Section 8.13 hereof)
of the required purchase price for the Convertible Notes; or (3) the Borrower
actually pays in cash any portion of the required purchase price for the
Convertible Notes in an amount in excess of any such cash payments otherwise
permitted by Section 8.13 hereof, (e) there occurs a "Change of Control" (or any
comparable term) under, and as defined in the documents evidencing or governing
any Subordinated Indebtedness (other than the Convertible Notes) or (f) during
any period of 12 consecutive months, a majority of the members of the board of
directors or other equivalent governing body of the Borrower cease to be
composed of individuals (i) who were members of that board or equivalent
governing body on the first day of such period, (ii) whose election or
nomination to that board or equivalent governing body was approved by
individuals referred to in clause (i) above constituting at the time of such
election or nomination at least a majority of that board or equivalent governing
body or (iii) whose election or nomination to that board or other equivalent
governing body was approved by individuals referred to in clauses (i) and (ii)
above constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body (excluding, in the case of
both clause (ii) and clause (iii), any individual whose initial nomination for,
or assumption of office as, a member of that board or equivalent governing body
occurs as a result of an actual or threatened solicitation of proxies or
consents for the election or removal of one or more directors by any person or
group other than a solicitation for the election of one or more directors by or
on behalf of the board of directors). As used herein, "beneficial ownership"
shall have the meaning provided in Rule 13d-3 of the Securities and Exchange
Commission under the Securities Exchange Act.
"Closing Date" means the first date all the conditions precedent in
Section 5.01 are satisfied or waived in accordance with Section 10.01.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" means a collective reference to all real and personal
Property (other than Excluded Property) with respect to which Liens in favor of
the Administrative Agent are purported to be granted pursuant to and in
accordance with the terms of the Collateral Documents.
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"Collateral Documents" means a collective reference to the Security
Agreement, the Mortgage Instruments, the Control Agreements and such other
security documents as may be executed and delivered by the Loan Parties pursuant
to the terms of Section 7.14.
"Commercial Letter of Credit" means any commercial Letter of Credit
issued (or deemed issued) hereunder.
"Commercial Letter of Credit Sublimit" means an amount equal to the
Aggregate Revolving Commitments, as such amount may be reduced from time to time
in accordance with the terms set forth herein. The Commercial Letter of Credit
Sublimit is part of, and not in addition to, the Aggregate Revolving
Commitments.
"Commitment" means, as to each Lender, the Revolving Commitment of such
Lender and/or the Term Loan Commitment of such Lender.
"Compliance Certificate" means a certificate substantially in the form
of Exhibit C.
"Consolidated Adjusted Debt" means, as of any date of determination,
the sum of (a) Consolidated Funded Indebtedness as of such date and (b) the
product of Consolidated Total Operating Lease Expense for the four fiscal
quarter period then ended multiplied by 6.0.
"Consolidated Depreciation and Amortization" means, for any period, for
the Consolidated Parties on a consolidated basis, depreciation and amortization
for such period plus any increase to Consolidated Total Operating Lease Expense
for such period resulting from the write up of Operating Leases related to any
Acquisition, all as determined in accordance with GAAP.
"Consolidated EBITDA" means, for any period, for the Consolidated
Parties on a consolidated basis, an amount equal to (a) Consolidated Net Income
for such period plus (b) the following to the extent deducted in calculating
such Consolidated Net Income: (i) Consolidated Total Income Tax Expense, (ii)
Consolidated Depreciation and Amortization, (iii) Consolidated Total Net
Interest Expense, (iv) other non-cash charges in an aggregate amount not to
exceed $20,000,000 over the term of this Agreement (and in any event not to
exceed $10,000,000 in any fiscal year of the Borrower), (v) those add-backs in
the amounts and for the periods set forth on Schedule 1.01-2 and (vi) add-backs
during the fourth quarter of the Borrower's 2004 fiscal year and the Borrower's
2005 fiscal year in connection with Project "Jay Hawk" (i.e., the conversion or
closing of approximately 48 stores including all of the remaining Jarman stores)
in an aggregate amount (on a pre-tax basis) not to exceed (x) $2,000,000 for the
fourth quarter of the Borrower's fiscal year 2004 and (y) $3,500,000 for the
Borrower's fiscal year 2005 minus (c) non-cash credits to the extent such
amounts increased Consolidated Net Income for such period, all as determined in
accordance with GAAP, except as otherwise specifically provided herein.
"Consolidated EBITDAR" means for any period, for the Consolidated
Parties on a consolidated basis, the sum of (a) Consolidated EBITDA for such
period plus (b) Consolidated Total Operating Lease Expense for such period.
7
"Consolidated EBITR" means for any period, for the Consolidated Parties
on a consolidated basis, (a) Consolidated EBITDA for such period minus (b)
Consolidated Depreciation and Amortization for such period plus (c) Consolidated
Total Operating Lease Expense for such period.
"Consolidated Fixed Charge Coverage Ratio" means, as of any date of
determination, the ratio of (a) Consolidated EBITR to (b) the sum of (i)
Consolidated Total Net Interest Expense plus (ii) Consolidated Total Operating
Lease Expense, in each case for the four quarter fiscal period then ended.
"Consolidated Funded Indebtedness" means, as of any date of
determination, for the Consolidated Parties on a consolidated basis, without
duplication, the sum of (a) the principal portion of all obligations for
borrowed money, (b) the principal portion of all obligations evidenced by bonds,
debentures, notes or similar instruments, or upon which interest payments are
customarily made, (c) the principal portion of all obligations under conditional
sale or other title retention agreements relating to Property purchased by the
Consolidated Parties (other than customary reservations or retentions of title
under agreements with suppliers entered into in the ordinary course of
business), (d) the principal portion of all obligations issued or assumed as the
deferred purchase price of Property or services purchased by the Consolidated
Parties (other than trade debt incurred in the ordinary course of business and
due within six months of the incurrence thereof) which would appear as
liabilities on a balance sheet of the Consolidated Parties, (e) the Attributable
Indebtedness with respect to Capital Leases and Synthetic Lease Obligations, (f)
the principal portion of all direct and contingent obligations as an account
party in respect of letters of credit (including standby and commercial letters
of credit) and bankers' acceptances, including, without duplication, all
unreimbursed drafts drawn thereunder (less the amount of any cash collateral
securing any such letters of credit or bankers' acceptances), (g) all
obligations to repurchase any securities issued by the Consolidated Parties at
any time prior to the Maturity Date, which repurchase obligations are related to
the issuance thereof, including, without limitation, obligations commonly known
as residual equity appreciation potential shares, (h) the aggregate amount of
uncollected accounts receivable subject at such time to a sale or securitization
of receivables (or similar transaction) (whether or not such transaction would
be reflected on the balance sheet of the Consolidated Parties in accordance with
GAAP) (all such Indebtedness of the types described in the forgoing clauses (a)
through (h), as to any Person, "Funded Indebtedness"), (i) all Funded
Indebtedness of others secured by (or for which the holder of such Funded
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on, or payable out of the proceeds of production from, Property owned
or acquired by the Consolidated Parties, whether or not the obligations secured
thereby have been assumed, (j) all Guarantees with respect to Funded
Indebtedness of another Person and (k) the Funded Indebtedness of any
partnership or unincorporated joint venture in which a Consolidated Party is a
general partner or a joint venturer to the extent such Indebtedness is recourse
to a Consolidated Party. To the extent that the rights and remedies of the
obligee of any Consolidated Funded Indebtedness are limited to certain property
and are otherwise non-recourse to any Consolidated Party, the amount of such
Consolidated Funded Indebtedness shall be limited to the value of the
Consolidated Parties' interest in such property (valued at the higher of book
value or market value as of such date of determination).
8
"Consolidated Interest Income" means, for any period, aggregate cash
interest income for the Consolidated Parties on a consolidated basis for such
period, as determined in accordance with GAAP; provided that:
(a) as of the end of the first quarter of fiscal year 2005,
Consolidated Interest Income for the four quarter fiscal period then
ended shall be deemed to be actual Consolidated Interest Income for the
fiscal month then ended multiplied by twelve (12);
(b) as of the end of the second quarter of fiscal year 2005,
Consolidated Interest Income for the four quarter fiscal period then
ended shall be deemed to be actual Consolidated Interest Income for the
four fiscal months then ended multiplied by three (3); and
(c) as of the end of the third quarter of fiscal year 2005,
Consolidated Interest Income for the four quarter fiscal period then
ended shall be deemed to be actual Consolidated Interest Income for the
seven fiscal months then ended multiplied by one and five-sevenths (1
5/7).
"Consolidated Net Income" means, for any period, the net earnings (or
loss) of the Consolidated Parties on a consolidated basis for such period taken
as a single accounting period, but excluding extraordinary items of gain or
loss, all as determined in accordance with GAAP.
"Consolidated Net Worth" means, as of any date of determination, the
sum of Capital Stock (including nonredeemable preferred stock but subtracting
treasury stock) and additional paid-in capital plus retained earnings (or minus
accumulated deficit) of the Borrower and its Subsidiaries, on a consolidated
basis determined in accordance with GAAP.
"Consolidated Parties" means a collective reference to the Borrower and
its Subsidiaries, and "Consolidated Party" means any one of them.
"Consolidated Tangible Net Worth" means, as of any date of
determination, for the Consolidated Parties on a consolidated basis,
Consolidated Net Worth minus those assets classified as intangible for balance
sheet purposes in accordance with GAAP.
"Consolidated Total Assets" means, as of any date of determination, for
the Consolidated Parties on a consolidated basis, total assets, determined in
accordance with GAAP.
"Consolidated Total Income Tax Expense" means, for any period, for the
Consolidated Parties on a consolidated basis, total income, value added and/or
similar tax expense for such period, as determined in accordance with GAAP.
"Consolidated Total Interest Expense" means, for any period, for the
Consolidated Parties on a consolidated basis, total cash interest expense for
such period, as determined in accordance with GAAP; provided that:
9
(a) as of the end of the first quarter of fiscal year 2005,
Consolidated Total Interest Expense for the four quarter fiscal period
then ended shall be deemed to be actual Consolidated Total Interest
Expense for the fiscal month then ended multiplied by twelve (12);
(b) as of the end of the second quarter of fiscal year 2005,
Consolidated Total Interest Expense for the four quarter fiscal period
then ended shall be deemed to be actual Consolidated Total Interest
Expense for the four fiscal months then ended multiplied by three (3);
and
(c) as of the end of the third quarter of fiscal year 2005,
Consolidated Total Interest Expense for the four quarter fiscal period
then ended shall be deemed to be actual Consolidated Total Interest
Expense for the seven fiscal months then ended multiplied by one and
five-sevenths (1 5/7).
"Consolidated Total Net Interest Expense" means, for any period, for
the Consolidated Parties on a consolidated basis, (a) Consolidated Total
Interest Expense for such period less (b) Consolidated Interest Income for such
period.
"Consolidated Total Operating Lease Expense" means, for any period,
total cash rental expense (excluding real estate taxes and other pass-through
expenses but including contingent rent payments) of the Consolidated Parties on
a consolidated basis for such period attributable to Operating Leases to which
the Borrower and its Subsidiaries are a party, net of sublease rentals,
determined in accordance with GAAP; provided that:
(a) as of the end of the first quarter of fiscal year 2005,
Consolidated Total Operating Lease Expense for the four quarter fiscal
period then ended shall be deemed to be actual Consolidated Total
Operating Lease Expense for the fiscal month then ended multiplied by
twelve (12);
(b) as of the end of the second quarter of fiscal year 2005,
Consolidated Total Operating Lease Expense for the four quarter fiscal
period then ended shall be deemed to be actual Consolidated Total
Operating Lease Expense for the four fiscal months then ended
multiplied by three (3); and
(c) as of the end of the third quarter of fiscal year 2005,
Consolidated Total Operating Lease Expense for the four quarter fiscal
period then ended shall be deemed to be actual Consolidated Total
Operating Lease Expense for the seven fiscal months then ended
multiplied by one and five-sevenths (1 5/7).
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any material agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Control" has the meaning specified in the definition of "Affiliate"
set forth in this Section 1.01.
10
"Control Agreements" means those certain control agreements dated as of
the Closing Date executed in favor of the Administrative Agent by the parties
thereto in accordance with the terms of the Security Agreement, as amended,
modified, restated or supplemented from time to time.
"Convertible Noteholders" means any one of the holders from time to
time of the Convertible Notes.
"Convertible Notes" means the 4.125% Convertible Subordinated
Debentures due 2023 issued pursuant to the Convertible Note Indenture by the
Borrower in favor of the Convertible Noteholders, as such Convertible Notes may
be amended, modified, restated or supplemented and in effect from time to time
in accordance with the terms hereof.
"Convertible Note Indenture" means that Indenture dated as of June 24,
2003 by and among the Borrower and the Bank of New York, as trustee for the
Convertible Noteholders, as such Indenture may be amended, modified, restated or
supplemented and in effect from time to time in accordance with the terms
hereof.
"Credit Extension" means each of the following: (a) a Borrowing and (b)
an L/C Credit Extension.
"Debt Issuance" means the issuance by any Consolidated Party of any
Indebtedness of the type referred to in clause (a) or (b) of the definition
thereof set forth in this Section 1.01.
"Debt Issuance Prepayment Event" means the receipt by any Consolidated
Party of proceeds from any Debt Issuance other than an Excluded Debt Issuance.
"Debtor Relief Laws" means the Bankruptcy Code and all other
liquidation, conservatorship, bankruptcy, assignment for the benefit of
creditors, moratorium, rearrangement, receivership, insolvency, reorganization,
or similar debtor relief Laws of the United States or other applicable
jurisdictions from time to time in effect and affecting the rights of creditors
generally.
"Default" means any event or condition that constitutes an Event of
Default or that, with the giving of any notice, the passage of time, or both,
would be an Event of Default.
"Default Rate" means (a) when used with respect to Obligations other
than Letter of Credit Fees, an interest rate equal to (i) the Base Rate plus
(ii) the Applicable Rate, if any, applicable to Base Rate Loans plus (iii) 2%
per annum; provided, however, that with respect to a Eurodollar Rate Loan, the
Default Rate shall be an interest rate equal to the interest rate (including any
Applicable Rate) otherwise applicable to such Loan plus 2% per annum, and (b)
when used with respect to Letter of Credit Fees, a rate equal to the Applicable
Rate plus 2% per annum, in all cases to the fullest extent permitted by
applicable Laws.
11
"Defaulting Lender" means any Lender that (a) has failed to fund any
portion of the Loans or participations in L/C Obligations required to be funded
by it hereunder within one Business Day of the date required to be funded by it
hereunder, (b) has otherwise failed to pay over to the Administrative Agent or
any other Lender any other amount required to be paid by it hereunder within one
Business Day of the date when due, unless the subject of a good faith dispute,
or (c) has been deemed insolvent or become the subject of a bankruptcy or
insolvency proceeding.
"Discretionary L/C Issuer" has the meaning specified in Section
2.03(b)(vi).
"Disposition" or "Dispose" means any disposition (including pursuant to
a Sale and Leaseback Transaction) of any or all of the Property (including
without limitation the Capital Stock of a Subsidiary) of any Consolidated Party,
whether by sale, lease, licensing, transfer or otherwise, but other than
pursuant to any casualty or condemnation event; provided, however, that the term
"Disposition" shall be deemed to (i) include any "Asset Sale" (or any comparable
term) under, and as defined in, the documents evidencing or governing any
Subordinated Indebtedness and (ii) exclude any Equity Issuance.
"Disposition Prepayment Event" means, with respect to any Disposition
other than an Excluded Disposition, the failure of the Loan Parties to apply (or
cause to be applied) the Net Cash Proceeds of such Disposition to Eligible
Reinvestments during the Application Period for such Disposition.
"Dollar" and "$" mean lawful money of the United States.
"Dollar Equivalent" means, at any time, (a) with respect to any amount
denominated in Dollars, such amount, and (b) with respect to any amount
denominated in any Alternative Currency, the equivalent amount thereof in
Dollars as determined by the Administrative Agent or the L/C Issuer, as the case
may be, at such time on the basis of the Spot Rate (determined as of the most
recent Revaluation Date) for the purchase of Dollars with such Alternative
Currency.
"Domestic Subsidiary" means any Subsidiary that is organized under the
laws of any political subdivision of the United States.
"EBITDA" means, for any Person or Property for any period, the net
income (excluding extraordinary items) of such Person or Property for such
period before (without duplication) interest expense, income taxes and
depreciation and amortization, all as determined in accordance with GAAP.
"Eligible Assignee" has the meaning specified in Section 11.07(g).
"Eligible Reinvestment" means (a) any acquisition (whether or not
constituting a capital expenditure, but not constituting an Acquisition) of
assets or any business (or any substantial part thereof) used or useful in the
same or a similar line of business as the Borrower and its Subsidiaries were
engaged in on the Closing Date (or any reasonable extensions or expansions
thereof) and (b) any Permitted Acquisition. The term "Eligible Reinvestment"
shall not include
12
any item which is not a permitted application of proceeds of an "Asset Sale" (or
any comparable term) under, and as defined in, the documents evidencing or
governing any Subordinated Indebtedness.
"EMU" means the economic and monetary union in accordance with the
Treaty of Rome 1957, as amended by the Single European Act of 1986, the
Maastricht Treaty of 1992 and the Amsterdam Treaty of 1998.
"EMU Legislation" means the legislative measures of the European
Council for the introduction of, changeover to or operation of a single or
unified European currency.
"Environmental Laws" means any and all Federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, licenses or governmental restrictions relating to pollution
and the protection of the environment or the release of any Hazardous Materials
into the environment, including those related to hazardous substances or wastes,
air emissions and discharges to waste or public systems.
"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower, any other Loan Party or any of their
respective Subsidiaries directly or indirectly resulting from or based upon (a)
violation of any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials, (c)
exposure to any Hazardous Materials, (d) the release or threatened release of
any Hazardous Materials into the environment or (e) any contract, agreement or
other consensual arrangement pursuant to which liability is assumed or imposed
with respect to any of the foregoing.
"Equity Issuance" means any issuance by any Consolidated Party to any
Person of (a) shares of its Capital Stock, (b) any shares of its Capital Stock
pursuant to the exercise of options or warrants, (c) any shares of its Capital
Stock pursuant to the conversion of any debt securities to equity or the
conversion of any class equity securities to any other class of equity
securities or (d) any options or warrants relating to its Capital Stock. The
term "Equity Issuance" shall not be deemed to include any Disposition.
"Equity Issuance Prepayment Event" means the receipt by any
Consolidated Party of proceeds from any Equity Issuance other than an Excluded
Equity Issuance.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the Borrower within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for
purposes of provisions relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a Pension
Plan; (b) a withdrawal by the Borrower or any ERISA Affiliate from a Pension
Plan subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in
13
Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as
such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial
withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan or
notification that a Multiemployer Plan is in reorganization; (d) the filing of a
notice of intent to terminate, the treatment of a Plan amendment as a
termination under Sections 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e)
an event or condition which constitutes grounds under Section 4042 of ERISA for
the termination of, or the appointment of a trustee to administer, any Pension
Plan or Multiemployer Plan; or (f) the imposition of any liability under Title
IV of ERISA, other than for PBGC premiums due but not delinquent under Section
4007 of ERISA, upon the Borrower or any ERISA Affiliate.
"Euro" and "EUR" mean the lawful currency of the Participating Member
States in accordance with the EMU Legislation.
"Eurodollar Rate" means for any Interest Period with respect to a
Eurodollar Rate Loan:
(a) the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate that appears on the page of
the Telerate screen (or any successor thereto) that displays an average
British Bankers Association Interest Settlement Rate for deposits in
Dollars (for delivery on the first day of such Interest Period) with a
term equivalent to such Interest Period, determined as of approximately
11:00 a.m. (London time) two Business Days prior to the first day of
such Interest Period, or
(b) if the rate referenced in the preceding clause (a) does
not appear on such page or service or such page or service shall not be
available, the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate on such other page or other
service that displays an average British Bankers Association Interest
Settlement Rate for deposits in Dollars (for delivery on the first day
of such Interest Period) with a term equivalent to such Interest
Period, determined as of approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period, or
(c) if the rates referenced in the preceding clauses (a) and
(b) are not available, the rate per annum determined by the
Administrative Agent as the rate of interest at which deposits in
Dollars for delivery on the first day of such Interest Period in same
day funds in the approximate amount of the Eurodollar Rate Loan being
made, continued or converted by Bank of America and with a term
equivalent to such Interest Period would be offered by Bank of
America's London Branch to major banks in the London interbank
eurodollar market at their request at approximately 4:00 p.m. (London
time) two Business Days prior to the first day of such Interest Period.
"Eurodollar Rate Loan" means a Loan that bears interest at a rate based
on the Eurodollar Rate.
"Event of Default" has the meaning specified in Section 9.01.
14
"Excess Proceeds" shall have the meaning assigned to such term in
Section 7.07(b).
"Excluded Debt Issuance" means any Debt Issuance permitted by Section
8.03 other than Section 8.03(g); provided, however, that the term "Excluded Debt
Issuance" shall not include any Debt Issuance to the extent that any portion of
the proceeds of such Debt Issuance would be required under any documents
evidencing or governing any Subordinated Indebtedness to be applied to
permanently retire Indebtedness of the Consolidated Parties.
"Excluded Disposition" means, with respect to any Consolidated Party,
any Disposition consisting of (i) the sale, lease, license, transfer or other
disposition of inventory in the ordinary course of such Consolidated Party's
business, (ii) the sale, lease, license, transfer or other disposition of
machinery and equipment no longer used or useful in the conduct of such
Consolidated Party's business, (iii) any sale, lease, license, transfer or other
disposition of Property by such Consolidated Party to any Loan Party, provided
that the Loan Parties shall cause to be executed and delivered such documents,
instruments and certificates as the Administrative Agent may request so as to
cause the Loan Parties to be in compliance with the terms of Section 7.13 after
giving effect to such transaction, (iv) any Involuntary Disposition, (v) any
Disposition by such Consolidated Party constituting a Permitted Investment and
(vi) if such Consolidated Party is not a Loan Party, any sale, lease, license,
transfer or other disposition of Property by such Consolidated Party to any
Consolidated Party that is not a Loan Party; provided, however, that the term
"Excluded Disposition" shall not include any Disposition to the extent that any
portion of the proceeds of such Disposition would be required under the
documents evidencing or governing any Subordinated Indebtedness to be applied to
permanently retire Indebtedness of the Consolidated Parties.
"Excluded Equity Issuance" means (a) any Equity Issuance by any
Consolidated Party to any Loan Party, and any Equity Issuance by any
Consolidated Party that is not a Loan Party to any Consolidated Party, (b) any
Equity Issuance by the Borrower to the seller of a business acquired in a
Permitted Acquisition, (c) any Equity Issuance by the Borrower the proceeds of
which are used to finance a Permitted Acquisition, (d) any Equity Issuance to a
director or employee resulting from the exercise of an option pursuant to an
incentive or stock purchase plan of the Borrower, or (e) any Equity Issuance to
replace outstanding debt securities of the Borrower that by their terms are
convertible into the Capital Stock so issued, and (f) any Equity Issuance
subject to subsection 8.06(c); provided, however, that the term "Excluded Equity
Issuance" shall not include any Equity Issuance to the extent that any portion
of the proceeds of such Equity Issuance would be required under the documents
evidencing or governing any Subordinated Indebtedness to be applied to
permanently retire Indebtedness of the Consolidated Parties.
"Excluded Property" means, with respect to any Loan Party, including
any Person that becomes a Loan Party after the Closing Date as contemplated by
Section 7.12, (a) any leased real or personal Property, (b) any owned real or
personal Property which is located outside of the United States and which has a
net book value of less than $2,500,000, provided that the aggregate net book
value of all real Property of all of the Loan Parties excluded pursuant to this
clause (b) shall not exceed $5,000,000, (c) any owned real Property which is
located in the United States and which is has a net book value of less than
$1,000,000, provided that the aggregate net book value of all real Property of
all of the Loan Parties excluded pursuant to this
15
clause (c) shall not exceed $3,000,000, (d) any personal Property (including,
without limitation, motor vehicles) in respect of which perfection of a Lien is
not either (i) governed by the Uniform Commercial Code or (ii) effected by
appropriate evidence of the Lien being filed in either the United States
Copyright Office or the United States Patent and Trademark Office and (e) any
Property which, subject to the terms of Section 8.09, is subject to a Permitted
Lien (excluding Liens under Section 8.01(a)) pursuant to documents which
prohibit such Loan Party from granting any other Liens in such Property.
"Existing Credit Agreement" means that certain Second Amended, Restated
and Modified Loan Agreement dated as of July 16, 2001 among the Borrower, Bank
of America, N.A., as agent, and a syndicate of lenders.
"Existing Letters of Credit" means those Letters of Credit issued by
any L/C Issuer prior to the Closing Date and set forth on Schedule 1.01-3
attached hereto.
"Extraordinary Receipts" means any cash received by or paid to or for
the account of any Person other than in the ordinary course of business,
including, without limitation, tax refunds, pension plan reversions, proceeds of
insurance (including Excess Proceeds from Involuntary Dispositions but excluding
proceeds of business interruption insurance to the extent such proceeds
constitute compensation for lost earnings and proceeds from reinsurance received
in the ordinary course of business), condemnation awards (and payments in lieu
thereof), indemnity payments, purchase price adjustments received in connection
with any purchase agreement or other similar agreement and payments in respect
of judgments or settlements of claims, litigation or proceedings; provided,
however, that Extraordinary Receipts in no event shall include cash receipts
received from proceeds of insurance or condemnation awards (or payments in lieu
thereof) or compensation from third parties to the extent that such proceeds,
awards or payments (a) are received by any Person in respect of any third party
claim against or loss by such Person and promptly applied to pay (or to
reimburse such Person for its prior payment of) such claim or loss and the costs
and expenses of such Person with respect thereto or (b) are applied (or are in
respect of expenditures that were previously incurred) to replace or repair
Property in respect of which such proceeds were received (or to reimburse such
amounts previously paid), in each case in accordance with the terms of the Loan
Documents and so long as such application is commenced within one year after the
receipt of such proceeds, awards or payments.
"Facility Fee" has the meaning specified in Section 2.08(a).
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upward, if necessary, to a whole multiple of 1/100 of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next
succeeding such day; provided that (a) if such day is not a Business Day, the
Federal Funds Rate for such day shall be such rate on such transactions on the
next preceding Business Day as so published on the next succeeding Business Day,
and (b) if no such rate is so published on such next succeeding Business Day,
the Federal Funds Rate for such day shall be the average rate charged to Bank of
America on such day on such transactions as determined by the Administrative
Agent.
16
"Fee Letter" means the letter agreement, dated January 22, 2004, among
the Borrower, the Administrative Agent and the Arranger.
"FIRREA" means the Financial Institutions Reform, Recovery, and
Enforcement Act of 1989, as amended, and any successor statute thereto, as
interpreted by the rules and regulations thereunder, as amended, including,
without limitation, 12 CFR part 34.41 to 34.47.
"Foreign Lender" has the meaning specified in Section 11.15(a)(i).
"Foreign Subsidiary" means any Subsidiary that is not a Domestic
Subsidiary.
"FRB" means the Board of Governors of the Federal Reserve System of the
United States.
"Fully Satisfied" means, with respect to the Obligations as of any
date, that, as of such date, (a) all principal of and interest accrued to such
date which constitute Obligations shall have been irrevocably paid in full in
cash, (b) all fees, expenses and other amounts then due and payable which
constitute Obligations shall have been irrevocably paid in cash, (c) all
outstanding Letters of Credit shall have been (i) terminated, (ii) fully
irrevocably Cash Collateralized or (iii) secured by one or more letters of
credit on terms and conditions, and with one or more financial institutions,
reasonably satisfactory to the L/C Issuer and (d) the Commitments shall have
expired or been terminated in full.
"Funded Indebtedness" has the meaning given to such term in the
definition of Consolidated Funded Indebtedness in Section 1.01.
"GAAP" means generally accepted accounting principles in the United
States set forth in the opinions and pronouncements of the Accounting Principles
Board and the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board or such other
principles as may be approved by a significant segment of the accounting
profession in the United States, that are applicable to the circumstances as of
the date of determination, consistently applied.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
"Guarantee" means, as to any Person, (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation payable or performable by
another Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of such Person, direct or indirect, (i)
to purchase or pay (or advance or supply funds for the purchase or payment of)
such Indebtedness or other obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other obligation of the
17
payment or performance of such Indebtedness or other obligation, (iii) to
maintain working capital, equity capital or any other financial statement
condition or liquidity or level of income or cash flow of the primary obligor so
as to enable the primary obligor to pay such Indebtedness or other obligation,
or (iv) entered into for the purpose of assuring in any other manner the obligee
in respect of such Indebtedness or other obligation of the payment or
performance thereof or to protect such obligee against loss in respect thereof
(in whole or in part), or (b) any Lien on any assets of such Person securing any
Indebtedness or other obligation of any other Person, whether or not such
Indebtedness or other obligation is assumed by such Person. The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable
amount of the related primary obligation, or portion thereof, in respect of
which such Guarantee is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof as determined by the
guaranteeing Person in good faith. The term "Guarantee" as a verb has a
corresponding meaning.
"Guarantors" means a collective reference to the Persons identified as
"Guarantors" on the signature pages hereto, and each other Person that
subsequently becomes a Guarantor by executing a Joinder Agreement as
contemplated by Section 7.12, and "Guarantor" means any one of them. A list of
the Guarantors as of the Closing Date is set forth on Schedule 1.01-1 attached
hereto.
"Guaranty" means the Guaranty made by the Guarantors in favor of the
Administrative Agent and the Lenders (and any Affiliate of a Lender that enters
into a Swap Contract or a Treasury Management Arrangement with a Loan Party)
pursuant to Article IV hereof.
"Hazardous Materials" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos-containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
"Indebtedness" means, with respect to any Person, without duplication,
(a) all obligations of such Person for borrowed money, (b) all obligations of
such Person evidenced by bonds, debentures, notes or similar instruments, or
upon which interest payments are customarily made, (c) all obligations of such
Person under conditional sale or other title retention agreements relating to
Property purchased by such Person (other than customary reservations or
retentions of title under agreements with suppliers entered into in the ordinary
course of business), (d) all obligations of such Person issued or assumed as the
deferred purchase price of Property or services purchased by such Person (other
than trade debt incurred in the ordinary course of business and due within six
months of the incurrence thereof) which would appear as liabilities on a balance
sheet of such Person, (e) all obligations of such Person under take-or-pay or
similar arrangements or under commodities agreements, (f) the Attributable
Indebtedness of such Person with respect to Capital Leases and Synthetic Lease
Obligations, (g) all net obligations of such Person under Swap Contracts, (h)
all direct and contingent obligations arising under letters of credit (including
standby and commercial letters of credit) and bankers' acceptances, including,
without duplication, all unreimbursed drafts drawn thereunder (less the amount
of any cash collateral securing any such letters of credit or and bankers'
acceptances), (i) all obligations of such Person to repurchase any securities
issued by such
18
Person at any time prior to the Maturity Date, which repurchase obligations are
related to the issuance thereof, including, without limitation, obligations
commonly known as residual equity appreciation potential shares, (j) the
aggregate amount of uncollected accounts receivable of such Person subject at
such time to a sale or securitization of receivables (or similar transaction)
(whether or not such transaction would be reflected on the balance sheet of such
Person in accordance with GAAP), (k) all Indebtedness of the types described in
the preceding clauses (a) through (j) that is owed by others and secured by (or
for which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on, or payable out of the proceeds of
production from, Property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed, (l) all Guarantees of such Person
with respect to Indebtedness of the types described in the preceding clauses (a)
through (j) that is owed by another Person and (m) Indebtedness of the types
described in the preceding clauses (a) through (j) that is owed by any
partnership or unincorporated joint venture in which such Person is a general
partner or a joint venturer to the extent such Indebtedness is recourse to such
Person. The amount of any net obligation under any Swap Contract on any date
shall be deemed to be the Swap Termination Value thereof as of such date. To the
extent that the rights and remedies of the obligee of any Indebtedness are
limited to certain property and are otherwise non-recourse to such Person, the
amount of such Indebtedness shall be limited to the value of the Person's
interest in such property (valued at the higher of book value or market value as
of such date of determination).
"Indemnified Liabilities" has the meaning specified in Section 11.05.
"Indemnitees" has the meaning specified in Section 11.05.
"Indentures" has the meaning specified in Section 8.01(q).
"Intellectual Property" has the meaning specified in Section 6.17.
"Interest Payment Date" means, (a) as to any Loan other than a Base
Rate Loan, the last day of each Interest Period applicable to such Loan and the
Maturity Date; provided, however, that if any Interest Period for a Eurodollar
Rate Loan exceeds three months, the respective dates that fall every three
months after the beginning of such Interest Period shall also be Interest
Payment Dates; and (b) as to any Base Rate Loan, the fifth Business Day after
the end of each fiscal quarter of the Borrower and the Maturity Date.
"Interest Period" means, as to each Eurodollar Rate Loan, the period
commencing on the date such Eurodollar Rate Loan is disbursed or converted to or
continued as a Eurodollar Rate Loan and ending on the date one, two, three or
six months thereafter, as selected by the Borrower in its Loan Notice; 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;
19
(ii) any Interest Period that begins on the last Business Day
of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at the
end of such Interest Period; and
(iii) no Interest Period shall extend beyond the Maturity
Date.
"Investment" in any Person means (a) any Acquisition of such Person or
its Property, (b) any other acquisition of Capital Stock, bonds, notes,
debentures or partnership, joint venture or other ownership interests or other
securities of such other Person, (c) any deposit with, or advance, loan or other
extension of credit to, such Person (other than deposits made in connection with
the purchase of equipment, inventory and supplies in the ordinary course of
business and deposits in the nature of security for the performance of
obligations of such Person) or (d) any other capital contribution to or
investment in such Person, including, without limitation, any Guarantee
(including any support for a letter of credit issued on behalf of such Person)
incurred for the benefit of such Person and any Disposition to such Person for
consideration less than the fair market value of the Property disposed in such
transaction, but excluding any Restricted Payment to such Person. Investments
which are capital contributions or purchases of Capital Stock which have a right
to participate in the profits of the issuer thereof shall be valued at the
amount (or, in the case of any Investment made with Property other than cash,
the book value of such Property) actually contributed or paid (including cash
and non-cash consideration and any assumption of Indebtedness) to purchase such
Capital Stock as of the date of such contribution or payment, less the amount of
all repayments and returns of principal or capital thereon to the extent paid in
cash or Cash Equivalents (or, in the case of any Investment made with Property
other than cash, upon return of such Property, by an amount equal to the lesser
of the book value of such Property at the time of such Investment or the fair
market value of such Property at the time of such return) and attributable to
any Investment made after the Closing Date. Investments which are loans,
advances, extensions of credit or Guarantees shall be valued at the principal
amount of such loan, advance or extension of credit outstanding as of the date
of determination or, as applicable, the principal amount of the loan or advance
outstanding as of the date of determination actually guaranteed by such
Guarantees.
"Involuntary Disposition" means any loss of, damage to or destruction
of, or any condemnation or other taking for public use of, any Property of any
Consolidated Party.
"IRS" means the United States Internal Revenue Service.
"ISP" means, with respect to any Letter of Credit, the "International
Standby Practices 1998" published by the Institute of International Banking Law
& Practice (or such later version thereof as may be in effect at the time of
issuance).
"Issuer Documents" means with respect to any Letter of Credit, the
Letter Credit Application, and any other document, agreement and instrument
entered into by the L/C Issuer and the Borrower (or any Subsidiary) or in favor
the L/C Issuer and relating to any such Letter of Credit.
20
"Joinder Agreement" means a Joinder Agreement substantially in the form
of Exhibit D hereto, executed and delivered by a new Guarantor in accordance
with the provisions of Section 7.12.
"LaSalle Line of Credit" means that certain $25,000,000 revolving
credit facility established pursuant to that certain Amended and Restated Credit
Agreement dated as of April 13, 2001, as amended, by and among the Acquired
Company and LaSalle Bank National Association.
"Laws" means, collectively, all international, foreign, Federal, state
and local statutes, treaties, rules, guidelines, regulations, ordinances, codes
and administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.
"L/C Advance" means, with respect to each Lender, such Lender's funding
of its participation in any L/C Borrowing in accordance with its Pro Rata Share.
All L/C Advances shall be denominated in Dollars.
"L/C Borrowing" means an extension of credit resulting from a drawing
under any Letter of Credit which has not been reimbursed on the date when made
or refinanced as a Borrowing of Revolving Loans. All L/C Borrowings shall be
denominated in Dollars.
"L/C Credit Extension" means, with respect to any Letter of Credit, the
issuance thereof or extension of the expiry date thereof, or the increase of the
amount thereof.
"L/C Issuer" means, as applicable, Bank of America in its capacity as
issuer of Letters of Credit hereunder, any Discretionary L/C Issuer, any Lender
that has issued an Existing Letter of Credit, or any successor issuer of Letters
of Credit hereunder.
"L/C Obligations" means, as of any date of determination, the aggregate
undrawn amount of all outstanding Letters of Credit plus the aggregate of all
Unreimbursed Amounts, including all L/C Borrowings. For all purposes of this
Agreement, if on any date of determination a Letter of Credit has expired by its
terms but any amount may still be drawn thereunder by reason of the operation of
Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be "outstanding"
in the amount so remaining available to be drawn.
"Lenders" means a collective reference to the Persons identified as
"Lenders" on the signature pages hereto, together with any Person that
subsequently becomes a Lender by way of assignment in accordance with the terms
of Section 11.07, together with their respective successors, and "Lender" means
any one of them, and, as the context requires, includes the L/C Issuer.
21
"Lending Office" means, as to any Lender, the office or offices of such
Lender described as such in such Lender's Administrative Questionnaire, or such
other office or offices as a Lender may from time to time notify the Borrower
and the Administrative Agent.
"Letter of Credit" means any Standby Letter of Credit or Commercial
Letter of Credit issued hereunder and shall include the Existing Letters of
Credit. Letters of Credit may be issued in Dollars or in an Alternative
Currency.
"Letter of Credit Application" means an application and agreement for
the issuance or amendment of a Letter of Credit in the form from time to time in
use by the L/C Issuer.
"Letter of Credit Fee" has the meaning specified in Section 2.03(i).
"Letter of Credit Expiration Date" means the day that is 35 days prior
to the Maturity Date then in effect (or, if such day is not a Business Day, the
next preceding Business Day).
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, or preference,
priority or other security interest or preferential arrangement in the nature of
a security interest of any kind or nature whatsoever (including any conditional
sale or other title retention agreement, and any financing lease having
substantially the same economic effect as any of the foregoing).
"Loan" means any Revolving Loan or the Term Loan, as the context may
require. The term "Loan" also shall mean, as appropriate, (i) any portion of the
Revolving Loans bearing interest at the same rate of interest and having an
Interest Period which begins and ends on the same date and, (ii) any portion of
the Term Loan bearing interest at the same rate of interest and having an
Interest Period which begins and ends on the same date.
"Loan Documents" means this Agreement, each Note, each Letter of
Credit, each Issuer Document, each Joinder Agreement, the Collateral Documents
and the Fee Letter.
"Loan Notice" means a notice of (a) a Borrowing, (b) a conversion of
Loans from one Type to the other, or (c) a continuation of Eurodollar Rate
Loans, pursuant to Section 2.02(a), which, if in writing, shall be substantially
in the form of Exhibit A.
"Loan Parties" means, collectively, the Borrower and each Guarantor.
"Marketable Securities" means marketable securities that are traded on
either the New York Stock Exchange, the American Stock Exchange or the NASDAQ
National Market System.
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, liabilities
(actual or contingent) or condition (financial or otherwise) of the Borrower and
its Subsidiaries taken as a whole; (b) a material impairment of the ability of
the Loan Parties to perform their obligations under any Loan
22
Document; or (c) a material adverse effect upon the rights and remedies of the
Administrative Agent and the Lenders under the Loan Documents.
"Material Domestic Subsidiary" means any Material Subsidiary that is a
Domestic Subsidiary.
"Material Subsidiary" means, as of any date of determination, any
Subsidiary of the Borrower (a) the assets of which exceed five percent (5%) of
Consolidated Total Assets measured as of the end of the most recently ended
fiscal quarter with respect to which the Administrative Agent has received the
Required Financial Information or (b) which represents more than ten percent
(10%) of the consolidated revenue or Consolidated Net Income of the Consolidated
Parties measured (i) as of the end of the most recently ended fiscal quarter
with respect to which the Administrative Agent has received the Required
Financial Information, and (ii) for the four (4) consecutive fiscal quarter
period then ended. It is understood that the term "Material Subsidiary" shall
include, without limitation, any Subsidiary of the Borrower whose principal
assets are one or more Material Subsidiaries.
"Maturity Date" means April 1, 2009.
"Merger Agreement" means that certain Agreement and Plan of Merger by
and among the Borrower, HWC Merger Sub, Inc. and the Acquired Company dated as
of February 5, 2004, as it may be amended on or prior to the Closing Date.
"Moody's" means Moody's Investors Service, Inc. and any successor
thereto.
"Mortgage Instruments" shall have the meaning assigned such term in
Section 5.01(d).
"Mortgage Policies" shall have the meaning assigned such term in
Section 5.01(d).
"Mortgaged Properties" shall have the meaning assigned such term in
Section 5.01(d).
"Multiemployer Plan" means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA
Affiliate makes or is obligated to make contributions, or during the preceding
five plan years, has made or been obligated to make contributions.
"Net Cash Proceeds" means the aggregate cash or Cash Equivalents
proceeds received by any Consolidated Party in respect of any Disposition,
Equity Issuance, Debt Issuance or Extraordinary Receipts, net of (a) direct
costs incurred in connection therewith (including, without limitation, legal,
accounting and investment banking fees, and sales commissions), (b) taxes paid
or payable as a result thereof and (c) in the case of any Disposition, the
amount necessary to retire any Indebtedness secured by a Permitted Lien (ranking
senior to any Lien of the Administrative Agent) on the related Property; it
being understood that "Net Cash Proceeds" shall include, without limitation, any
cash or Cash Equivalents received upon the sale or other disposition of any
non-cash consideration received by any such Consolidated Party in any
Disposition, Equity Issuance, Debt Issuance or Extraordinary Receipts. In
addition, the "Net Cash Proceeds" of any Disposition shall
23
include any other amounts which constitute "Net Proceeds" (or any comparable
term) of such transaction under, and as defined, in the documents evidencing or
governing any Subordinated Indebtedness.
"Note" or "Notes" means the Revolving Notes and/or the Term Notes,
individually or collectively, as appropriate.
"Obligations" means all advances to, and debts, liabilities,
obligations, covenants and duties of, any Loan Party arising under any Loan
Document or otherwise with respect to any Loan or Letter of Credit, whether
direct or indirect (including those acquired by assumption), absolute or
contingent, due or to become due, now existing or hereafter arising and
including (i) interest and fees that accrue after the commencement by or against
any Loan Party or any Affiliate thereof of any proceeding under any Debtor
Relief Laws naming such Person as the debtor in such proceeding, regardless of
whether such interest and fees are allowed claims in such proceeding, (ii)
Indebtedness under any Swap Contract of any Loan Party to which a Lender or any
Affiliate of such Lender is a party and (iii) any amounts owing in connection
with any Treasury Management Arrangements provided to a Loan Party by any Lender
or Affiliate of a Lender.
"Operating Lease" means, as applied to any Person, any lease
(including, without limitation, leases which may be terminated by the lessee at
any time) of any Property (whether real, personal or mixed) which is not a
Capital Lease, other than any such lease in which that Person is the lessor.
"Organization Documents" means, (a) with respect to any corporation,
the certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement; and (c) with respect to
any partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or
organization of such entity.
"Outstanding Amount" means (i) with respect to Loans on any date, the
aggregate outstanding principal amount thereof after giving effect to any
borrowings and prepayments or repayments of Revolving Loans, as the case may be,
occurring on such date; and (ii) with respect to any L/C Obligations on any
date, the Dollar Equivalent of the aggregate outstanding amount of such L/C
Obligations on such date after giving effect to any L/C Credit Extension
occurring on such date and any other changes in the aggregate amount of the L/C
Obligations as of such date, including as a result of any reimbursements of
outstanding unpaid drawings under any Letters of Credit or any reductions in the
maximum amount available for drawing under Letters of Credit taking effect on
such date.
"Overnight Rate" means, for any day, (a) with respect to any amount
denominated in Dollars, the Federal Funds Rate, and (b) with respect to any
amount denominated in an
24
Alternative Currency, the rate of interest per annum at which overnight deposits
in the applicable Alternative Currency, in an amount approximately equal to the
amount with respect to which such rate is being determined, would be offered for
such day by a branch or Affiliate of Bank of America in the applicable offshore
interbank market for such currency to major banks in such interbank market.
"Participant" has the meaning specified in Section 11.07(d).
"Participating Member State" means each state so described in any EMU
Legislation.
"PBGC" means the Pension Benefit Guaranty Corporation.
"Pension Plan" means any "employee pension benefit plan" (as such term
is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Borrower or
any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes
or has an obligation to contribute, or in the case of a multiple employer or
other plan described in Section 4064(a) of ERISA, has made contributions at any
time during the immediately preceding five plan years.
"Permitted Acquisition" means an Acquisition by the Borrower or any
Subsidiary of the Borrower permitted pursuant to the terms of Section 8.02(i).
"Permitted Investments" means, at any time, Investments by the
Consolidated Parties permitted to exist at such time pursuant to the terms of
Section 8.02.
"Permitted Liens" means, at any time, Liens in respect of Property of
the Consolidated Parties permitted to exist at such time pursuant to the terms
of Section 8.01.
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any "employee benefit plan" (as such term is defined in
Section 3(3) of ERISA) established by the Borrower or, with respect to any such
plan that is subject to Section 412 of the Code or Title IV of ERISA, any ERISA
Affiliate.
"Preferred Stock" means the Borrower's Subordinated Serial Preferred
Stock, Series 1, 3 and 4, outstanding on the Closing Date.
"Principal Amortization Payment" means a principal payment on the Term
Loan as set forth in Section 2.06(b).
"Pro Forma Basis" means, for purposes of calculating (utilizing the
principles set forth in Section 1.03(c)) compliance with each of the financial
covenants set forth in Section 8.11 in respect of a proposed transaction, that
such transaction shall be deemed to have occurred as of the first day of the
four fiscal-quarter period ending as of the most recent fiscal quarter end
preceding the date of such transaction with respect to which the Administrative
Agent has
25
received the Required Financial Information. As used herein, "transaction" shall
mean (a) any Disposition subject to Section 8.05 and (b) any Acquisition as
referred to in Section 8.02(i). In connection with any calculation of the
financial covenants set forth in Section 8.11 upon giving effect to a
transaction on a Pro Forma Basis:
(i) for purposes of any such calculation in respect of any
Disposition subject to Section 8.05, (A) income statement
items (whether positive or negative) attributable to the
Person or Property disposed of shall be excluded and (B) any
Indebtedness which is retired in connection with such
transaction shall be excluded and deemed to have been retired
as of the first day of the applicable period; and
(ii) for purposes of any such calculation in respect of any
Acquisition as referred to in Section 8.02(i), (A) any
Indebtedness incurred or assumed by any Consolidated Party
(including the Person or Property acquired) in connection with
such transaction and any Indebtedness of the Person or
Property acquired which is not retired in connection with such
transaction (1) shall be deemed to have been incurred as of
the first day of the applicable period and (2) if such
Indebtedness has a floating or formula rate, shall have an
implied rate of interest for the applicable period for
purposes of this definition determined by utilizing the rate
which is or would be in effect with respect to such
Indebtedness as at the relevant date of determination, (B)
income statement items (whether positive or negative)
attributable to the Person or Property acquired shall be
included beginning as of the first day of the applicable
period and (C) pro forma adjustments may be included to the
extent that such adjustments would give effect to events that
are (1) directly attributable to such transaction, (2)
expected to have a continuing impact on the Consolidated
Parties and (3) factually supportable.
"Pro Forma Compliance Certificate" means a certificate of a Responsible
Officer of the Borrower delivered to the Administrative Agent in connection with
(a) any Disposition subject to Section 8.05 or (b) any Acquisition as referred
to in Section 8.02(i), as applicable, and containing reasonably detailed
calculations, upon giving effect to the applicable transaction on a Pro Forma
Basis, of (i) the Consolidated Fixed Charge Coverage Ratio, the (ii) ratio of
Consolidated Adjusted Debt to Consolidated EBITDAR and (iii) Consolidated
Tangible Net Worth as of the most recent fiscal quarter end preceding the date
of the applicable transaction with respect to which the Administrative Agent
shall have received the Required Financial Information.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Pro Rata Share" means as to each Lender (a) with respect to such
Lender's Revolving Commitment at any time, a fraction (expressed as a
percentage, carried out to the ninth decimal place), the numerator of which is
the amount of the Revolving Commitment of such Lender at such time and the
denominator of which is the amount of the Aggregate Revolving Commitments at
such time; provided that if the commitment of each Lender to make Revolving
Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have
been terminated
26
pursuant to Section 9.02, then the Pro Rata Share of such Lender shall be
determined based on the Pro Rata Share of such Lender immediately prior to such
termination and after giving effect to any subsequent assignments made pursuant
to the terms hereof and, (b) with respect to such Lender's outstanding Term Loan
at any time, a fraction (expressed as a percentage, carried out to the ninth
decimal place), the numerator of which is the principal amount of the Term Loan
held by such Lender at such time and the denominator of which is the aggregate
principal amount of the Term Loan at such time. The initial Pro Rata Share of
each Lender is set forth opposite the name of such Lender on Schedule 2.01 or in
the Assignment and Assumption pursuant to which such Lender becomes a party
hereto, as applicable.
"Real Properties" means, at any time, a collective reference to each of
the facilities and real properties owned, leased or operated by the Consolidated
Parties at such time.
"Register" has the meaning specified in Section 11.07(c).
"Reportable Event" means any of the events set forth in Section 4043(c)
of ERISA, other than events for which the 30 day notice period has been waived.
"Request for Credit Extension" means (a) with respect to a Borrowing,
conversion or continuation of Loans, a Loan Notice and (b) with respect to an
L/C Credit Extension, a Letter of Credit Application.
"Required Financial Information" means, with respect to each fiscal
period or quarter of the Borrower, (a) the financial statements required to be
delivered pursuant to Section 7.01(a) or (b) for such fiscal period or quarter,
and (b) the certificate of a Responsible Officer of the Borrower required by
Section 7.02(b) to be delivered with the financial statements described in
clause (a) above.
"Required Lenders" means, at any time, Lenders holding in the aggregate
more than 50% of (a) the unfunded Commitments (and participations therein) and
the outstanding Loans, L/C Obligations and participations therein or (b) if the
Commitments have been terminated, the outstanding Loans, L/C Obligations and
participations therein. The unfunded Commitments of, and the outstanding Loans
held or deemed held by, any Defaulting Lender shall be excluded for purposes of
making a determination of Required Lenders.
"Responsible Officer" means the chief executive officer, president,
chief financial officer, chief legal officer and/or general counsel, treasurer
or assistant treasurer of a Loan Party. Any document delivered hereunder that is
signed by a Responsible Officer of a Loan Party shall be conclusively presumed
to have been authorized by all necessary corporate, partnership and/or other
action on the part of such Loan Party and such Responsible Officer shall be
conclusively presumed to have acted on behalf of such Loan Party.
"Restricted Payment" means (a) any dividend or other payment or
distribution, direct or indirect, on account of any shares of any class of
Capital Stock of any Consolidated Party, now or hereafter outstanding (including
without limitation any payment in connection with any dissolution, merger,
consolidation or disposition involving any Consolidated Party), or to the
holders, in their
27
capacity as such, of any shares of any class of Capital Stock of any
Consolidated Party, now or hereafter outstanding, (b) any redemption,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any shares of any class of Capital Stock of any
Consolidated Party, now or hereafter outstanding or (c) any payment made to
retire, or to obtain the surrender of, any outstanding warrants, options or
other rights to acquire shares of any class of Capital Stock of any Consolidated
Party, now or hereafter outstanding.
"Revaluation Date" means with respect to any Letter of Credit, each of
the following: (a) each date of issuance of any Letter of Credit, (b) each date
of an amendment of any such Letter of Credit having the effect of increasing the
amount thereof (solely with respect to the increased amount), (c) each date of
any payment by the L/C Issuer of any Letter of Credit denominated in an
Alternative Currency, (d) the last Business Day of each calendar month and (e)
such additional dates as the Administrative Agent or the L/C Issuer shall
require.
"Revolving Commitment" means, as to each Lender, its obligation to (a)
make Revolving Loans to the Borrower pursuant to Section 2.01(a) and (b)
purchase participations in L/C Obligations, in an aggregate principal amount at
any one time outstanding not to exceed the amount set forth opposite such
Lender's name on Schedule 2.01 or in the Assignment and Assumption pursuant to
which such Lender becomes a party hereto, as applicable, as such amount may be
adjusted from time to time in accordance with this Agreement.
"Revolving Loan" has the meaning specified in Section 2.01(a).
"Revolving Note" has the meaning specified in Section 2.10(a).
"S&P" means Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc. and any successor thereto.
"Sale and Leaseback Transaction" means any arrangement pursuant to
which any Consolidated Party, directly or indirectly, becomes liable as lessee,
guarantor or other surety with respect to any lease, whether an Operating Lease
or a Capital Lease, of any Property (a) which such Consolidated Party has sold
or transferred (or is to sell or transfer) to a Person which is not a
Consolidated Party or (b) which such Consolidated Party intends to use for
substantially the same purpose as any other Property which has been sold or
transferred (or is to be sold or transferred) by such Consolidated Party to
another Person which is not a Consolidated Party in connection with such lease.
"Same Day Funds" means (a) with respect to disbursements and payments
in Dollars, immediately available funds, and (b) with respect to disbursements
and payments in an Alternative Currency, same day or other funds as may be
determined by the Administrative Agent or the L/C Issuer, as applicable, to be
customary in the place of disbursement or payment for the settlement of
international banking transactions in the relevant Alternative Currency.
"SEC" means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
28
"Security Agreement" means the security and pledge agreement dated as
of the Closing Date executed in favor of the Administrative Agent by each of the
Loan Parties, as amended, modified, restated or supplemented from time to time.
"Shareholder Right" means a right distributed to holders of the
Borrower's common stock pursuant to a shareholders' rights plan adopted by the
board of directors of the Borrower which (i) grants to the holder of such right
the option to acquire a share of the Borrower's capital stock on or before a
future date, (ii) upon the acquisition of beneficial ownership by any Person of
a specified percentage of the outstanding shares of a class of the Borrower's
capital stock or of a specified percentage of the voting power of all of the
Borrower's outstanding capital stock, grants to the holder of such right the
option to acquire shares of the Borrower's common stock and (iii) upon the
consummation of a merger, consolidation, share exchange, sale of assets or other
business combination with a Person who beneficially owns a specified percentage
of the outstanding shares of a class of the Borrower's capital stock or a
specified percentage of the voting power of all of the Borrower's outstanding
capital stock, grants to the holder of such right the right to acquire
securities of such Person.
"Solvent" or "Solvency" means, with respect to any Person as of a
particular date, that on such date (a) such Person is able to pay its debts and
other liabilities, contingent obligations and other commitments as they mature
in the ordinary course of business, (b) 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 in their ordinary course,
(c) such Person is not engaged in a business or a transaction, and is not about
to engage in a business or a transaction, for which such Person's Property would
constitute unreasonably small capital after giving due consideration to the
prevailing practice in the industry in which such Person is engaged or is to
engage, (d) the fair value of the Property of such Person is greater than the
total amount of liabilities, including, without limitation, contingent
liabilities, of such Person and (e) 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 debts as they become absolute and
matured. In computing the amount of contingent liabilities at any time, it is
intended that such liabilities will be computed at the amount which, in light of
all the facts and circumstances existing at such time, represents the amount
that can reasonably be expected to become an actual or matured liability.
"Spot Rate" for a currency means the rate determined by the
Administrative Agent or the L/C Issuer, as applicable, to be the rate quoted by
the Person acting in such capacity as the spot rate for the purchase by such
Person of such currency with another currency through its principal foreign
exchange trading office at approximately 11:00 a.m. on the date two Business
Days prior to the date as of which the foreign exchange computation is made;
provided that the Administrative Agent or the L/C Issuer may obtain such spot
rate from another financial institution designated by the Administrative Agent
or the L/C Issuer if the Person acting in such capacity does not have as of the
date of determination a spot buying rate for any such currency; and provided
further that the L/C Issuer may use such spot rate quoted on the date as of
which the foreign exchange computation is made in the case of any Letter of
Credit denominated in an Alternative Currency.
29
"Standby Letter of Credit" means any standby Letter of Credit issued
(or deemed issued) hereunder.
"Standby Letter of Credit Sublimit" means an amount equal to FIFTEEN
MILLION DOLLARS ($15,000,000). The Standby Letter of Credit Sublimit is part of,
and not in addition to, the Aggregate Revolving Commitments.
"Subordinated Indebtedness" means the Indebtedness evidenced by the
Convertible Notes and the Convertible Note Indenture and any other Indebtedness
of the Consolidated Parties which by its terms is subordinated to the
Obligations in a manner and to an extent acceptable to the Required Lenders.
"Subsidiary" of a Person means a corporation, partnership, joint
venture, limited liability company or other business entity of which a majority
of the shares of Capital Stock having ordinary voting power for the election of
directors or other members of its governing body (other than Capital Stock
having such power only by reason of the happening of a contingency) are at the
time beneficially owned, or the management of which is otherwise controlled,
directly, or indirectly through one or more intermediaries, or both, by such
Person. Unless otherwise specified, all references herein to a "Subsidiary" or
to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of the Borrower.
"Swap Contract" means (a) any and all rate swap transactions, basis
swaps, credit derivative transactions, forward rate transactions, commodity
swaps, commodity options, forward commodity contracts, equity or equity index
swaps or options, bond or bond price or bond index swaps or options or forward
bond or forward bond price or forward bond index transactions, interest rate
options, forward foreign exchange transactions, cap transactions, floor
transactions, collar transactions, currency swap transactions, cross-currency
rate swap transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a "Master Agreement"), including
any such obligations or liabilities under any Master Agreement.
"Swap Termination Value" means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as the
mark-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender).
30
"Synthetic Lease Obligation" means the monetary obligation of a Person
under (a) a so-called synthetic, off-balance sheet or tax retention lease, or
(b) an agreement for the use or possession of property creating obligations that
do not appear on the balance sheet of such Person but which, upon the insolvency
or bankruptcy of such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).
"Term Loan" has the meaning specified in Section 2.01(b).
"Term Loan Commitment" means, as to each Lender, its obligation to make
its portion of the Term Loan to the Borrower pursuant to Section 2.01(b), in the
principal amount set forth opposite such Lender's name on Schedule 2.01. The
aggregate principal amount of the Term Loan Commitments of all of the Lenders as
in effect on the Closing Date is ONE HUNDRED MILLION DOLLARS ($100,000,000).
"Term Note" has the meaning specified in Section 2.10(a).
"Threshold Amount" means $2,000,000.
"Total Revolving Outstandings" means the aggregate Outstanding Amount
of all Revolving Loans and all L/C Obligations.
"Transaction" means (a) the acquisition by the Borrower of the Acquired
Company pursuant to the terms of the Merger Agreement, (b) the making of the
Credit Extensions hereunder on the Closing Date and (c) all other related
transactions.
"Treasury Management Arrangements" means any treasury management
arrangements, services or products.
"Trustees" has the meaning specified in Section 8.01(q).
"Type" means, with respect to any Loan, its character as a Base Rate
Loan or a Eurodollar Rate Loan.
"Unfunded Pension Liability" means the excess of a Pension Plan's
benefit liabilities under Section 4001(a)(16) of ERISA, over the current value
of that Pension Plan's assets, determined in accordance with the assumptions
used for funding the Pension Plan pursuant to Section 412 of the Code for the
applicable plan year.
"United States" and "U.S." mean the United States of America.
"Unreimbursed Amount" has the meaning specified in Section 2.03(c)(i).
"Voting Stock" means, with respect to any Person, Capital Stock issued
by such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
has been suspended by the happening of such a contingency.
31
"Wholly Owned Subsidiary" means any Person 100% of whose Capital Stock
is at the time owned by the Borrower directly or indirectly through other
Persons 100% of whose Capital Stock is at the time owned, directly or
indirectly, by the Borrower.
1.02 OTHER INTERPRETIVE PROVISIONS.
With reference to this Agreement and each other Loan Document, unless
otherwise specified herein or in such other Loan Document:
(a) The meanings of defined terms are equally applicable
to the singular and plural forms of the defined terms.
(b) (i) The words "herein," "hereto," "hereof" and
"hereunder" and words of similar import when used in any Loan Document
shall refer to such Loan Document as a whole and not to any particular
provision thereof.
(ii) Article, Section, Exhibit and Schedule
references are to the Loan Document in which such reference
appears.
(iii) The term "including" is by way of example and
not limitation.
(iv) The term "documents" includes any and all
instruments, documents, agreements, certificates, notices,
reports, financial statements and other writings, however
evidenced, whether in physical or electronic form.
(c) Section headings herein and in the other Loan
Documents are included for convenience of reference only and shall not
affect the interpretation of this Agreement or any other Loan Document.
1.03 ACCOUNTING TERMS.
(a) Except as otherwise specifically prescribed herein, all
accounting terms not specifically or completely defined herein shall be
construed in conformity with, and all financial data (including financial ratios
and other financial calculations) required to be submitted pursuant to this
Agreement shall be prepared in conformity with, GAAP applied on a consistent
basis, as in effect from time to time, applied in a manner consistent with that
used in preparing the Audited Financial Statements; provided, however, that
calculations of Attributable Indebtedness under any Synthetic Lease Obligations
or the implied interest component of any Synthetic Lease Obligations shall be
made by the Borrower in accordance with accepted financial practice and
consistent with the terms of such Synthetic Lease Obligations.
(b) If at any time any change in GAAP would affect the computation
of any financial ratio or requirement set forth in any Loan Document, and either
the Borrower or the Required Lenders shall so request, the Administrative Agent,
the Lenders and the Borrower shall negotiate in good faith to amend such ratio
or requirement to preserve the original intent thereof in light of
32
such change in GAAP (subject to the approval of the Required Lenders); provided
that, until so amended, (i) such ratio or requirement shall continue to be
computed in accordance with GAAP prior to such change therein and (ii) the
Borrower shall provide to the Administrative Agent and the Lenders financial
statements and other documents required under this Agreement or as reasonably
requested hereunder setting forth a reconciliation between calculations of such
ratio or requirement made before and after giving effect to such change in GAAP.
(c) Notwithstanding the above, the parties hereto acknowledge and
agree that, for purposes of all calculations made under the financial covenants
set forth in Section 8.11 (including without limitation for purposes of the
definitions of "Applicable Rate" and "Pro Forma Basis" set forth in Section
1.01), after consummation of any Disposition (other than an Excluded
Disposition) or Permitted Acquisition the parties shall use the principles set
forth in the definition of "Pro Forma Basis" in Section 1.01.
1.04 ROUNDING.
Any financial ratios required to be maintained by the Borrower pursuant
to this Agreement shall be calculated by dividing the appropriate component by
the other component, carrying the result to one place more than the number of
places by which such ratio is expressed herein and rounding the result up or
down to the nearest number (with a rounding-up if there is no nearest number).
1.05 REFERENCES TO AGREEMENTS AND LAWS.
Unless otherwise expressly provided herein, (a) references to
Organization Documents, agreements (including the Loan Documents) and other
contractual instruments shall be deemed to include all subsequent amendments,
restatements, extensions, supplements and other modifications thereto, but only
to the extent that such amendments, restatements, extensions, supplements and
other modifications are not prohibited by any Loan Document; and (b) references
to any Law shall include all statutory and regulatory provisions consolidating,
amending, replacing, supplementing or interpreting such Law.
1.06 EXCHANGE RATES; CURRENCY EQUIVALENTS.
(a) The Administrative Agent or the L/C Issuer, as applicable,
shall determine as of each Revaluation Date the Spot Rates to be used for
calculating Dollar Equivalent amounts of Credit Extensions and Outstanding
Amounts denominated in Alternative Currencies. Such Spot Rates shall be
effective as of each such Revaluation Date and shall be the Spot Rates employed
in converting any amounts between the applicable currencies until the next
Revaluation Date to occur. Except as otherwise expressly provided herein, the
applicable amount of any currency (other than Dollars) for purposes of the Loan
Documents shall be such Dollar Equivalent amount as so determined by the
Administrative Agent or the L/C Issuer, as applicable.
(b) Wherever in this Agreement in connection with the issuance,
amendment or extension of a Letter of Credit, an amount, such as a required
minimum or multiple amount, is expressed in Dollars, but such Letter of Credit
is denominated in an Alternative Currency, such
33
amount shall be the relevant Alternative Currency Equivalent of such Dollar
amount (rounded to the nearest unit of such Alternative Currency, with 0.5 of a
unit being rounded upward), as determined by the Administrative Agent or the L/C
Issuer, as applicable.
1.07 ADDITIONAL ALTERNATIVE CURRENCIES.
(a) The Borrower may from time to time request that Letters of
Credit be issued in a currency other than those specifically listed in the
definition of "Alternative Currency;" provided that such requested currency is a
lawful currency (other than Dollars) that is readily available and freely
transferable and convertible into Dollars. Such request shall be subject to the
approval of the Administrative Agent and the L/C Issuer. Any such request shall
be made to the Administrative Agent not later than 11:00 a.m., ten (10) Business
Days prior to the date of the desired Credit Extension (or such other time or
date as may be agreed by the Administrative Agent and the L/C Issuer, in their
sole discretion). The L/C Issuer shall notify the Administrative Agent, not
later than 11:00 a.m., five (5) Business Days after receipt of such request
whether it consents, in its sole discretion, to the issuance of Letters of
Credit in such requested currency. Any failure by the L/C Issuer to respond to
such request within the time period specified in the preceding sentence shall be
deemed to be a refusal by the L/C Issuer to permit Letters of Credit to be
issued in such requested currency. If the Administrative Agent and the L/C
Issuer consent to the issuance of Letters of Credit in such requested currency,
the Administrative Agent shall so notify the Borrower and such currency shall
thereupon be deemed for all purposes to be an Alternative Currency hereunder for
purposes of any Letter of Credit issuances. If the Administrative Agent shall
fail to obtain consent to any request for an additional currency under this
Section 1.07, the Administrative Agent shall promptly so notify the Borrower.
1.08 CHANGE OF CURRENCY.
(a) Each obligation of the Borrower to make a payment denominated
in the national currency unit of any member state of the European Union that
adopts the Euro as its lawful currency after the date hereof shall be
redenominated into Euro at the time of such adoption (in accordance with the EMU
Legislation). If, in relation to the currency of any such member state, the
basis of accrual of interest expressed in this Agreement in respect of that
currency shall be inconsistent with any convention or practice in the London
interbank market for the basis of accrual of interest in respect of the Euro,
such expressed basis shall be replaced by such convention or practice with
effect from the date on which such member state adopts the Euro as its lawful
currency; provided that if any Credit Extension in the currency of such member
state is outstanding immediately prior to such date, such replacement shall take
effect, with respect to such Credit Extension, at the end of the then current
Interest Period.
(b) To the extent the adoption of the Euro by any member state of
the European Union and any relevant market conventions or practices relating to
the Euro should require or necessitate a change to the provisions of this
Agreement, the Lenders, the Administrative Agent, the L/C Issuer and the
Borrower shall negotiate in good faith to amend such provisions to
34
preserve the original intent thereof in light of such adoption (subject to the
approval of the Required Lenders).
(c) To the extent a change in currency of any other country and
any relevant market conventions or practices relating to the change in currency
should require or necessitate a change to the provisions of this Agreement, the
Lenders, the Administrative Agent, the L/C Issuer and the Borrower shall
negotiate in good faith to amend such provisions to preserve the original intent
thereof in light of such change (subject to the approval of the Required
Lenders).
1.09 TIMES OF DAY.
Unless otherwise specified, all references herein to times of day shall
be references to Eastern time (daylight or standard, as applicable).
1.10 LETTER OF CREDIT AMOUNTS.
Unless otherwise specified, all references herein to the amount of a
Letter of Credit at any time shall be deemed to mean the Dollar Equivalent of
the maximum face amount of such Letter of Credit after giving effect to all
increases or permanent reductions (to the extent such permanent reductions have
been effected) thereof contemplated by such Letter of Credit or the Issuer
Documents related thereto, whether or not such maximum face amount is in effect
at such time.
ARTICLE II
THE COMMITMENTS AND CREDIT EXTENSIONS
2.01 LOANS.
(a) Revolving Loans. Subject to the terms and conditions set forth
herein, each Lender severally agrees to make loans (each such loan, a "Revolving
Loan") to the Borrower from time to time, on any Business Day during the
Availability Period, in an aggregate amount not to exceed at any time
outstanding the amount of such Lender's Revolving Commitment; provided, however,
that after giving effect to any Borrowing of Revolving Loans, (i) the Total
Revolving Outstandings shall not exceed the Aggregate Revolving Commitments, and
(ii) the aggregate Outstanding Amount of the Revolving Loans of any Lender, plus
such Lender's Pro Rata Share of the Outstanding Amount of all L/C Obligations,
shall not exceed such Lender's Revolving Commitment. Within the limits of each
Lender's Revolving Commitment, and subject to the other terms and conditions
hereof, the Borrower may borrow under this Section 2.01(a), prepay under Section
2.04(a), and reborrow under this Section 2.01(a). Revolving Loans may be Base
Rate Loans or Eurodollar Rate Loans, as further provided herein.
(b) Term Loan. Subject to the terms and conditions set forth
herein, each Lender severally agrees to make its portion of a term loan (the
"Term Loan") to the Borrower on the Closing Date in an amount not to exceed such
Lender's Term Loan Commitment. Amounts
35
repaid on the Term Loan may not be reborrowed. The Term Loan may consist of Base
Rate Loans or Eurodollar Rate Loans, as further provided herein.
2.02 BORROWINGS, CONVERSIONS AND CONTINUATIONS OF LOANS.
(a) Each Borrowing, each conversion of Loans from one Type to the
other, and each continuation of Eurodollar Rate Loans shall be made upon the
irrevocable notice from the Borrower to the Administrative Agent, which may be
given by telephone (provided that such telephonic notice complies with the
information requirements of the form of Loan Notice attached hereto). Each such
notice must be received by the Administrative Agent not later than 11:00 a.m.
(i) three Business Days prior to the requested date of any Borrowing of,
conversion to or continuation of Eurodollar Rate Loans, and (ii) on the
requested date of any Borrowing of Base Rate Loans; provided, however, all
Borrowings made on the Closing Date shall be made as Base Rate Loans unless the
Administrative Agent shall received an appropriate funding indemnity letter
executed by the Borrower reasonably satisfactory to it as least three Business
Days prior to the Closing Date. Each telephonic notice by the Borrower pursuant
to this Section 2.02(a) must be confirmed promptly by delivery to the
Administrative Agent of a written Loan Notice, appropriately completed and
signed by a Responsible Officer of the Borrower. Each Borrowing of, conversion
to or continuation of Eurodollar Rate Loans shall be in a principal amount of
$1,000,000 or a whole multiple of $1,000,000 in excess thereof. Except as
provided in Sections 2.03(c), each Borrowing of or conversion to Base Rate Loans
shall be in a principal amount of $500,000 or a whole multiple of $100,000 in
excess thereof. Each Loan Notice (whether telephonic or written) shall specify
(i) whether the Borrower is requesting a Borrowing, a conversion of Loans from
one Type to the other, or a continuation of Eurodollar Rate Loans, (ii) the
requested date of the Borrowing, conversion or continuation, as the case may be
(which shall be a Business Day), (iii) the principal amount of Loans to be
borrowed, converted or continued, (iv) the Type of Loans to be borrowed or to
which existing Loans are to be converted, and (v) if applicable, the duration of
the Interest Period with respect thereto. If the Borrower fails to specify a
Type of Loan in a Loan Notice or if the Borrower fails to give a timely notice
requesting a conversion or continuation, then the applicable Loans shall be made
as, or converted to, Base Rate Loans. Any such automatic conversion to Base Rate
Loans shall be effective as of the last day of the Interest Period then in
effect with respect to the applicable Eurodollar Rate Loans. If the Borrower
requests a Borrowing of, conversion to, or continuation of Eurodollar Rate Loans
in any such Loan Notice, but fails to specify an Interest Period, it will be
deemed to have specified an Interest Period of one month.
(b) Following receipt of a Loan Notice, the Administrative Agent
shall promptly notify each Lender of the amount of its Pro Rata Share of the
applicable Loans, and if no timely notice of a conversion or continuation is
provided by the Borrower, the Administrative Agent shall notify each Lender of
the details of any automatic conversion to Base Rate Loans described in the
preceding subsection. In the case of a Borrowing, each Lender shall make the
amount of its Loan available to the Administrative Agent in immediately
available funds at the Administrative Agent's Office not later than 1:00 p.m. on
the Business Day specified in the applicable Loan Notice. Upon satisfaction of
the applicable conditions set forth in Section 5.02 (and, if such Borrowing is
the initial Credit Extension, Section 5.01), the Administrative Agent shall make
all funds so received available to the Borrower in like funds as received by the
36
Administrative Agent either by (i) crediting the account of the Borrower on the
books of the Administrative Agent with the amount of such funds or (ii) wire
transfer of such funds, in each case in accordance with instructions provided to
(and reasonably acceptable to) the Administrative Agent by the Borrower;
provided, however, that if, on the date a Loan Notice with respect to a
Borrowing consisting of Revolving Loans is given by the Borrower, there are L/C
Borrowings outstanding, then the proceeds of such Borrowing first shall be
applied to the payment in full of any such L/C Borrowings, and second, shall be
made available to the Borrower as provided above.
(c) Subject to Section 3.05, a Eurodollar Rate Loan may be
continued or converted only on the last day of an Interest Period for such
Eurodollar Rate Loan. During the existence of a Default, no Loans may be
requested as, converted to or continued as Eurodollar Rate Loans having Interest
Periods greater than one month without the consent of the Required Lenders.
During the existence of an Event of Default, no Loans may be converted to or
continued as Eurodollar Rate Loans without the consent of the Required Lenders.
(d) The Administrative Agent shall promptly notify the Borrower
and the Lenders of the interest rate applicable to any Interest Period for
Eurodollar Rate Loans upon determination of such interest rate. The
determination of the Eurodollar Rate by the Administrative Agent shall be
conclusive in the absence of manifest error. At any time that Base Rate Loans
are outstanding, the Administrative Agent shall notify the Borrower and the
Lenders of any change in Bank of America's prime rate used in determining the
Base Rate promptly following the public announcement of such change.
(e) After giving effect to all Borrowings, all conversions of
Loans from one Type to the other, and all continuations of Loans as the same
Type, there shall not be more than (i) six (6) Interest Periods in effect with
respect to Revolving Loans, and (ii) six (6) Interest Periods in effect with
respect to the Term Loan.
2.03 LETTERS OF CREDIT.
(a) The Letter of Credit Commitment.
(i) Subject to the terms and conditions set forth herein, (A)
the L/C Issuer agrees, in reliance upon the agreements of the other
Lenders set forth in this Section 2.03, (1) from time to time on any
Business Day during the period from the Closing Date until the Letter
of Credit Expiration Date, to issue Letters of Credit denominated in
Dollars or in one or more Alternative Currencies for the account of the
Borrower or its Subsidiaries, and to amend or extend Letters of Credit
previously issued by it, in accordance with subsection (b) below, and
(2) to honor drawings under the Letters of Credit; and (B) the Lenders
severally agree to participate in Letters of Credit issued for the
account of the Borrower or its Subsidiaries and any drawings
thereunder; provided that after giving effect to any L/C Credit
Extension with respect to any Letter of Credit (w) the Total Revolving
Outstandings shall not exceed the Aggregate Revolving Commitments, (x)
the aggregate Outstanding Amount of the Revolving Loans of any Lender,
plus such Lender's Pro Rata Share of the Outstanding Amount of all L/C
Obligations shall not
37
exceed such Lender's Revolving Commitment, (y) (I) the Outstanding
Amount of the L/C Obligations related to Commercial Letters of Credit
shall not exceed the Commercial Letter of Credit Sublimit and (II) the
Outstanding Amount of the L/C Obligations related to Standby Letters of
Credit shall not exceed the Standby Letter of Credit Sublimit and (z)
the Outstanding Amount of the L/C Obligations denominated in
Alternative Currencies would exceed the Alternative Currency Sublimit.
Each request by the Borrower for the issuance or amendment of a Letter
of Credit shall be deemed to be a representation by the Borrower that
the L/C Credit Extension so requested complies with the conditions set
forth in the proviso to the preceding sentence. Within the foregoing
limits, and subject to the terms and conditions hereof, the Borrower's
ability to obtain Letters of Credit shall be fully revolving, and
accordingly the Borrower may, during the foregoing period, obtain
Letters of Credit to replace Letters of Credit that have expired or
that have been drawn upon and reimbursed. All Existing Letters of
Credit shall be deemed to have been issued pursuant hereto, and from
and after the Closing Date shall be subject to and governed by the
terms and conditions hereof.
(ii) The L/C Issuer shall not issue any Letter of Credit
if:
(A) subject to Section 2.03(b)(iii), the expiry
date of such requested Letter of Credit
would occur more than twelve months after
the date of issuance or last extension,
unless the Required Lenders have approved
such expiry date; or
(B) the expiry date of such requested Letter of
Credit would occur after the Letter of
Credit Expiration Date, unless all the
Lenders have approved such expiry date.
(iii) The L/C Issuer shall not be under any obligation to
issue any Letter of Credit if:
(A) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin
or restrain the L/C Issuer from issuing such Letter of Credit,
or any Law applicable to the L/C Issuer or any request or
directive (whether or not having the force of law) from any
Governmental Authority with jurisdiction over the L/C Issuer
shall prohibit, or request that the L/C Issuer refrain from,
the issuance of letters of credit generally or such Letter of
Credit in particular or shall impose upon the L/C Issuer with
respect to such Letter of Credit any restriction, reserve or
capital requirement (for which the L/C Issuer is not otherwise
compensated hereunder) not in effect on the Closing Date, or
shall impose upon the L/C Issuer any unreimbursed loss, cost
or expense which was not applicable on the Closing Date and
which the L/C Issuer in good faith deems material to it;
(B) the issuance of such Letter of Credit would
violate any Laws or one or more policies of the L/C Issuer
applicable to all of such L/C Issuer's letter of credit
applicants; or
38
(C) such Letter of Credit is to be denominated in a
currency other than Dollars or an Alternative Currency;
(D) such Letter of Credit contains any provision for
automatic reinstatement of the stated amount after any drawing
thereunder; or
(E) a default of any Lender's obligations to fund
under Section 2.03(c) exists or any Lender is at such time a
Defaulting Lender hereunder, unless the L/C Issuer has entered
into satisfactory arrangements with the Borrower or such
Lender to eliminate the L/C Issuer's risk with respect to such
Lender.
(iv) The L/C Issuer shall not amend any Letter of Credit
if the L/C Issuer would not be permitted at such time to issue such
Letter of Credit in its amended form under the terms hereof.
(v) The L/C Issuer shall be under no obligation to amend
any Letter of Credit if (A) the L/C Issuer would have no obligation at
such time to issue such Letter of Credit in its amended form under the
terms hereof, or (B) the beneficiary of such Letter of Credit does not
accept the proposed amendment to such Letter of Credit.
(b) Procedures for Issuance and Amendment of Letters of Credit;
Auto-Extension Letters of Credit.
(i) Each Letter of Credit shall be issued or amended, as
the case may be, upon the request of the Borrower delivered to the L/C
Issuer (with a copy to the Administrative Agent) in the form of a
Letter of Credit Application, appropriately completed and signed by a
Responsible Officer of the Borrower. Such Letter of Credit Application
must be received by the L/C Issuer and the Administrative Agent (A) not
later than 11:00 a.m. at least two Business Days (or such later date
and time as the Administrative Agent and the L/C Issuer may agree in a
particular instance in its sole discretion) prior to the proposed
issuance date or date of amendment, as the case may be, of any Letter
of Credit denominated in Dollars and (B) not later than 11:00 a.m. at
least ten Business Days (or such later date and time as the L/C Issuer
may agree in a particulate instance in its sole discretion) prior to
the proposed issuance date or date of amendment, as the case may be, of
any Letter of Credit denominated in an Alternative Currency. In the
case of a request for an initial issuance of a Letter of Credit, such
Letter of Credit Application shall specify in form and detail
satisfactory to the L/C Issuer: (A) the proposed issuance date of the
requested Letter of Credit (which shall be a Business Day); (B) the
amount thereof; (C) the expiry date thereof; (D) the name and address
of the beneficiary thereof; (E) the documents to be presented by such
beneficiary in case of any drawing thereunder; (F) the full text of any
certificate to be presented by such beneficiary in case of any drawing
thereunder; and (G) such other matters as the L/C Issuer reasonably may
require. In the case of a request for an amendment of any outstanding
Letter of Credit, such Letter of Credit Application shall specify in
form and detail satisfactory to the L/C Issuer (1) the Letter of Credit
to be amended; (2) the proposed date of amendment thereof (which shall
39
be a Business Day); (3) the nature of the proposed amendment; and (4)
such other matters as the L/C Issuer may require. Additionally, the
Borrower shall furnish to the L/C Issuer and the Administrative Agent
such other documents and information pertaining to such requested
Letter of Credit issuance or amendment, including any Issuer Documents,
as the L/C Issuer or the Administrative Agent reasonably may require.
(ii) Promptly after receipt of any Letter of Credit
Application, the L/C Issuer will confirm with the Administrative Agent
(by telephone or in writing) that the Administrative Agent has received
a copy of such Letter of Credit Application from the Borrower and, if
not, the L/C Issuer will provide the Administrative Agent with a copy
thereof. Unless the L/C Issuer has received written notice from any
Lender, the Administrative Agent or any Loan Party, at least one
Business Day prior to the requested date of issuance or amendment of
the applicable Letter of Credit , that one or more of the applicable
conditions contained in Article V shall not then be satisfied, the L/C
Issuer shall, on the requested date, issue a Letter of Credit for the
account of the Borrower (or the applicable Subsidiary) or enter into
the applicable amendment, as the case may be, in each case in
accordance with the L/C Issuer's usual and customary business
practices. Immediately upon the issuance of each Letter of Credit, each
Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the L/C Issuer a risk participation in such
Letter of Credit in an amount equal to the product of such Lender's Pro
Rata Share times the amount of such Letter of Credit.
(iii) If the Borrower so requests in any applicable Letter
of Credit Application, the L/C Issuer may, in its sole and absolute
discretion, agree to issue a Letter of Credit that has automatic
extension provisions (each, an "Auto-Extension Letter of Credit");
provided that any such Auto-Extension Letter of Credit must permit the
L/C Issuer to prevent any such extension at least once in each
twelve-month period (commencing with the date of issuance of such
Letter of Credit) by giving prior notice to the beneficiary thereof not
later than a day (the "Non-Extension Notice Date") in each such
twelve-month period to be agreed upon at the time such Letter of Credit
is issued. Unless otherwise directed by the L/C Issuer, the Borrower
shall not be required to make a specific request to the L/C Issuer for
any such extension. Once an Auto-Extension Letter of Credit has been
issued, the Lenders shall be deemed to have authorized (but may not
require) the L/C Issuer to permit the extension of such Letter of
Credit at any time to an expiry date not later than the Letter of
Credit Expiration Date; provided, however, that the L/C Issuer shall
not permit any such extension if (A) the L/C Issuer has determined that
it would not be permitted, or would have no obligation, at such time to
issue such Letter of Credit in its revised form under the terms hereof
(by reason of the provisions of clause (ii) or (iii) of Section 2.03(a)
or otherwise), or (B) it has received notice (which may be by telephone
or in writing) on or before the day that is five Business Days before
the Non-Extension Notice Date (1) from the Administrative Agent that
the Required Lenders have elected not to permit such extension or (2)
from the Administrative Agent, any Lender or any Loan Party that one or
more of the applicable conditions specified in Section 5.02 is not then
satisfied, and in each case directing the L/C Issuer not to permit such
extension.
40
(iv) If any Letter of Credit contains provisions providing
for automatic reinstatement of the stated amount after any drawing
thereunder, (A) unless otherwise directed by the L/C Issuer, the
Borrower shall not be required to make a specific request to the L/C
Issuer to permit such reinstatement, and (B) the Administrative Agent
and the Lenders hereby authorize and direct the L/C Issuer to permit
such automatic reinstatement, whether or not a Default then exists,
unless to the extent provided for in the applicable L/C Documents the
L/C Issuer has received a notice (which may be by telephone or in
writing) on or before the day that is two Business Days before the
reinstatement date from the Administrative Agent, the Required Lenders
or any Loan Party that one or more of the applicable conditions
specified in Section 5.02 is not then satisfied and directing the L/C
Issuer to cease permitting such automatic reinstatement of such Letter
of Credit.
(v) Promptly after its delivery of any Letter of Credit
or any amendment to a Letter of Credit to an advising bank with respect
thereto or to the beneficiary thereof, the L/C Issuer will also deliver
to the Borrower and the Administrative Agent a true and complete copy
of such Letter of Credit or amendment.
(vi) Any Lender (in such capacity, a "Discretionary L/C
Issuer") may from time to time, at the written request of the Borrower
(with a copy to the Administrative Agent) and with the consent of the
Administrative Agent (such consent not to be unreasonably withheld),
but in the Borrower's sole discretion, agree to issue one or more
Letters of Credit for the account of the Borrower on the same terms and
conditions in all respects as are applicable to the Letters of Credit
issued by the L/C Issuer hereunder by executing and delivering to the
Administrative Agent a written agreement to such effect, among (and in
form and substance satisfactory to) the Borrower, the Administrative
Agent and such Discretionary L/C Issuer. With respect to each of the
Letters of Credit issued (or to be issued) thereby, each of the
Discretionary L/C Issuers shall have all of the same rights and
obligations under and in respect of this Agreement and the other Loan
Documents, and shall be entitled to all of the same benefits
(including, without limitation, the rights, obligations and benefits
set forth in Sections 2.03, 10.07 and 11.01), as are afforded to the
L/C Issuer hereunder and thereunder. The Administrative Agent shall
promptly notify each of the Revolving Credit Lenders of the appointment
of any Discretionary L/C Issuer. Each Discretionary L/C Issuer shall
provide to the Administrative Agent, on a monthly basis, a report that
details the activity with respect to each Letter of Credit issued by
such Discretionary L/C Issuer (including an indication of the maximum
amount then in effect with respect to each such Letter of Credit).
(c) Drawings and Reimbursements; Funding of Participations.
(i) Upon receipt from the beneficiary of any Letter of
Credit of any notice of a drawing under such Letter of Credit, the L/C
Issuer shall notify the Borrower and the Administrative Agent thereof.
Not later than 11:00 a.m. on the date of any payment by the L/C Issuer
under a Letter of Credit to be reimbursed in Dollars, or the Applicable
Time on the date of any payment by the L/C Issuer under a Letter of
Credit to be reimbursed in an Alternative Currency (each such date, an
"Honor Date"), the Borrower
41
shall reimburse the L/C Issuer through the Administrative Agent in an
amount equal to the amount of such drawing. In the case of a Letter of
Credit denominated in Dollars, the Borrower shall reimburse the L/C
Issuer in Dollars. In the case of a Letter of Credit denominated in an
Alternative Currency, the Borrower shall reimburse the L/C Issuer in
Dollars unless the L/C Issuer (at its option) shall specify in such
notice that it will require payment in the currency in which the
drawing is made. In the case of any such reimbursement in Dollars of a
drawing under a Letter of Credit denominated in an Alternative
Currency, the L/C Issuer shall notify the Borrower of the Dollar
Equivalent of the amount of the drawing promptly following the
determination thereof. If the Borrower fails to so reimburse the L/C
Issuer by such time, the Administrative Agent shall promptly notify
each Lender of the Honor Date, the amount of the unreimbursed drawing
(the "Unreimbursed Amount"), and the amount of such Lender's Pro Rata
Share thereof. In such event, the Borrower shall be deemed to have
requested a Borrowing of Base Rate Revolving Loans to be disbursed on
the Honor Date in an amount equal to the Unreimbursed Amount, without
regard to the minimum and multiples specified in Section 2.02 for the
principal amount of Base Rate Loans, but subject to the amount of the
unutilized portion of the Aggregate Revolving Commitments and the
conditions set forth in Section 5.02 (other than the delivery of a Loan
Notice). Any notice given by the L/C Issuer or the Administrative Agent
pursuant to this Section 2.03(c)(i) may be given by telephone if
immediately confirmed in writing; provided that the lack of such an
immediate confirmation shall not affect the conclusiveness or binding
effect of such notice.
(ii) Each Lender (including the Lender acting as L/C
Issuer) shall upon any notice pursuant to Section 2.03(c)(i) make funds
available to the Administrative Agent for the account of the L/C Issuer
at the Administrative Agent's Office in an amount equal to its Pro Rata
Share of the Unreimbursed Amount in Dollars not later than 1:00 p.m. on
the Business Day specified in such notice by the Administrative Agent,
whereupon, subject to the provisions of Section 2.03(c)(iii), each
Lender that so makes funds available shall be deemed to have made a
Base Rate Revolving Loan to the Borrower in such amount. The
Administrative Agent shall remit the funds so received to the L/C
Issuer in Dollars, or if requested by the L/C Issuer pursuant to the
provisions of Section 2.03(c)(i), the equivalent amount thereof in an
Alternative Currency as determined by the Administrative Agent at such
time on the basis of the Spot Rate (determined as of such funding date)
for the purchase of such Alternative Currency with Dollars.
(iii) With respect to any Unreimbursed Amount that is not
fully refinanced by a Borrowing of Base Rate Revolving Loans because
the conditions set forth in Section 5.02 (other than delivery of a Loan
Notice) cannot be satisfied or for any other reason, the Borrower shall
be deemed to have incurred from the L/C Issuer an L/C Borrowing in the
amount of the Unreimbursed Amount that is not so refinanced, which L/C
Borrowing shall be due and payable on demand (together with interest)
and shall bear interest at the Default Rate. In such event, each
Lender's payment to the Administrative Agent for the account of the L/C
Issuer pursuant to Section 2.03(c)(ii) shall be deemed payment in
respect of its participation in such L/C Borrowing and shall
42
constitute an L/C Advance from such Lender in satisfaction of its
participation obligation under this Section 2.03.
(iv) Until each Lender funds its Revolving Loan or L/C
Advance pursuant to this Section 2.03(c) to reimburse the L/C Issuer
for any amount drawn under any Letter of Credit, interest in respect of
such Lender's Pro Rata Share of such amount shall be solely for the
account of the L/C Issuer.
(v) Each Lender's obligation to make Revolving Loans or
L/C Advances to reimburse the L/C Issuer for amounts drawn under
Letters of Credit, as contemplated by this Section 2.03(c), shall be
absolute and unconditional and shall not be affected by any
circumstance, including (A) any set-off, counterclaim, recoupment,
defense or other right which such Lender may have against the L/C
Issuer, the Borrower or any other Person for any reason whatsoever; (B)
the occurrence or continuance of a Default, or (C) any other
occurrence, event or condition, whether or not similar to any of the
foregoing; provided, however, that each Lender's obligation to make
Revolving Loans pursuant to this Section 2.03(c) is subject to the
conditions set forth in Section 5.02 (other than delivery by the
Borrower of a Loan Notice). No such making of an L/C Advance shall
relieve or otherwise impair the obligation of the Borrower to reimburse
the L/C Issuer for the amount of any payment made by the L/C Issuer
under any Letter of Credit, together with interest as provided herein.
(vi) If any Lender fails to make available to the
Administrative Agent for the account of the L/C Issuer any amount
required to be paid by such Lender pursuant to the foregoing provisions
of this Section 2.03(c) by the time specified in Section 2.03(c)(ii),
the L/C Issuer shall be entitled to recover from such Lender (acting
through the Administrative Agent), on demand, such amount with interest
thereon for the period from the date such payment is required to the
date on which such payment is immediately available to the L/C Issuer
at a rate per annum equal to the applicable Overnight Rate from time to
time in effect. A certificate of the L/C Issuer submitted to any Lender
(through the Administrative Agent) with respect to any amounts owing
under this clause (vi) shall be conclusive absent manifest error.
(d) Repayment of Participations.
(i) At any time after the L/C Issuer has made a payment
under any Letter of Credit and has received from any Lender such
Lender's L/C Advance in respect of such payment in accordance with
Section 2.03(c), if the Administrative Agent receives for the account
of the L/C Issuer any payment in respect of the related Unreimbursed
Amount or interest thereon (whether directly from the Borrower or
otherwise, including proceeds of Cash Collateral applied thereto by the
Administrative Agent), the Administrative Agent will distribute to such
Lender its Pro Rata Share thereof (appropriately adjusted, in the case
of interest payments, to reflect the period of time during which such
Lender's L/C Advance was outstanding) in the same funds as those
received by the Administrative Agent.
43
(ii) If any payment received by the Administrative Agent
for the account of the L/C Issuer pursuant to Section 2.03(c)(i) is
required to be returned under any of the circumstances described in
Section 11.06 (including pursuant to any settlement entered into by the
L/C Issuer in its discretion), each Lender shall pay to the
Administrative Agent for the account of the L/C Issuer its Pro Rata
Share thereof on demand of the Administrative Agent, plus interest
thereon from the date of such demand to the date such amount is
returned by such Lender, at a rate per annum equal to the Federal Funds
Rate from time to time in effect.
(e) Obligations Absolute. The obligation of the Borrower to
reimburse the L/C Issuer for each drawing under each Letter of Credit and to
repay each L/C Borrowing shall be absolute, unconditional and irrevocable, and
shall be paid strictly in accordance with the terms of this Agreement under all
circumstances, including the following:
(i) any lack of validity or enforceability of such Letter
of Credit, this Agreement, or any other Loan Document;
(ii) the existence of any claim, counterclaim, set-off,
defense or other right that the Borrower or any Subsidiary may have at
any time against any beneficiary or any transferee of such Letter of
Credit (or any Person for whom any such beneficiary or any such
transferee may be acting), the L/C Issuer or any other Person, whether
in connection with this Agreement, the transactions contemplated hereby
or by such Letter of Credit or any agreement or instrument relating
thereto, or any unrelated transaction;
(iii) any draft, demand, certificate or other document
presented under such Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a
drawing under such Letter of Credit;
(iv) any payment by the L/C Issuer under such Letter of
Credit against presentation of a draft or certificate that does not
strictly comply with the terms of such Letter of Credit; or any payment
made by the L/C Issuer under such Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession,
assignee for the benefit of creditors, liquidator, receiver or other
representative of or successor to any beneficiary or any transferee of
such Letter of Credit, including any arising in connection with any
proceeding under any Debtor Relief Law;
(v) any adverse change in the relevant exchange rates or
in the availability of the relevant Alternative Currency to the
Borrower or any Subsidiary or in the relevant currency markets
generally; or
(vi) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available to, or
a discharge of, the Borrower or any Subsidiary.
44
The Borrower shall promptly examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Borrower's instructions or other irregularity, the
Borrower will immediately notify the L/C Issuer. The Borrower shall be
conclusively deemed to have waived any such claim against the L/C Issuer and its
correspondents unless such notice is given as aforesaid.
(f) Role of L/C Issuer. Each Lender and the Borrower agree that,
in paying any drawing under a Letter of Credit, the L/C Issuer shall not have
any responsibility to obtain any document (other than any sight draft,
certificates and documents expressly required by the Letter of Credit) or to
ascertain or inquire as to the validity or accuracy of any such document or the
authority of the Person executing or delivering any such document. None of the
L/C Issuer, any Agent-Related Person nor any of the correspondents, participants
or assignees of the L/C Issuer shall be liable to any Lender for (i) any action
taken or omitted in connection herewith at the request or with the approval of
the Lenders or the Required Lenders, as applicable; (ii) any action taken or
omitted in the absence of gross negligence or willful misconduct; or (iii) the
due execution, effectiveness, validity or enforceability of any document or
instrument related to any Letter of Credit or Letter of Credit Application. The
Borrower hereby assumes all risks of the acts or omissions of any beneficiary or
transferee with respect to its use of any Letter of Credit; provided, however,
that this assumption is not intended to, and shall not, preclude the Borrower's
pursuing such rights and remedies as it may have against the beneficiary or
transferee at law or under any other agreement. None of the L/C Issuer, any
Agent-Related Person, nor any of the respective correspondents, participants or
assignees of the L/C Issuer, shall be liable or responsible for any of the
matters described in clauses (i) through (v) of Section 2.03(e); provided,
however, that anything in such clauses to the contrary notwithstanding, the
Borrower may have a claim against the L/C Issuer, and the L/C Issuer may be
liable to the Borrower, to the extent, but only to the extent, of any direct, as
opposed to consequential or exemplary, damages suffered by the Borrower which
the Borrower proves were caused by the L/C Issuer's willful misconduct or gross
negligence or the L/C Issuer's willful failure to pay under any Letter of Credit
after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of
Credit. In furtherance and not in limitation of the foregoing, the L/C Issuer
may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary, and the L/C Issuer shall not be responsible for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason.
(g) Cash Collateral. (i) Upon the request of the
Administrative Agent, (A) if the L/C Issuer has honored any full or
partial drawing request under any Letter of Credit and such drawing has
resulted in an L/C Borrowing, or (B) if, as of the Letter of Credit
Expiration Date, any Letter of Credit for any reason remains
outstanding and partially or wholly undrawn, the Borrower shall
immediately Cash Collateralize the then Outstanding Amount of all L/C
Obligations (in an amount equal to such Outstanding Amount determined
as of the date of such L/C Borrowing or the Letter of Credit Expiration
Date, as the case may be).
45
(ii) In addition, if the Administrative Agent notifies the
Borrower at any time that the Outstanding Amount of all L/C Obligations
at such time exceeds the Alternative Currency Sublimit then in effect,
then, within two Business Days after receipt of such notice, the
Borrower shall Cash Collateralize the L/C Obligations in an amount
equal to the amount by which the Outstanding Amount of all L/C
Obligations exceeds the Alternative Currency Sublimit.
(iii) The Administrative Agent may, at any time and from
time to time after the initial deposit of Cash Collateral, request that
additional Cash Collateral be provided in order and as required to
protect against the results of exchange rate fluctuations.
(iv) Sections 2.05 and 9.02(c) set forth certain
additional requirements to deliver Cash Collateral hereunder. For
purposes of this Section 2.03, Section 2.05 and Section 9.02(c), "Cash
Collateralize" means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the L/C Issuer and the
Lenders, as collateral for the L/C Obligations, cash or deposit account
balances pursuant to documentation in form and substance satisfactory
to the Administrative Agent and the L/C Issuer (which documents are
hereby consented to by the Lenders). Derivatives of such term have
corresponding meanings. The Borrower hereby grants to the
Administrative Agent, for the benefit of the L/C Issuer and the
Lenders, a security interest in all such cash, deposit accounts and all
balances therein and all proceeds of the foregoing. Cash Collateral
shall be maintained in blocked, non-interest bearing deposit accounts
at with the Administrative Agent.
(h) Applicability of ISP and UCP. Unless otherwise expressly
agreed by the L/C Issuer and the Borrower when a Letter of Credit is issued
(including any such agreement applicable to an Existing Letter of Credit), (i)
the rules of the ISP shall apply to each Standby Letter of Credit, and (ii) the
rules of the Uniform Customs and Practice for Documentary Credits, as most
recently published by the International Chamber of Commerce at the time of
issuance shall apply to each Commercial Letter of Credit.
(i) Letter of Credit Fees. The Borrower shall pay to the
Administrative Agent for the account of each Lender with a Revolving Commitment
in accordance with its Pro Rata Share in Dollars a Letter of Credit Fee
(collectively, the "Letter of Credit Fees") (i) for each Commercial Letter of
Credit equal to the Applicable Rate times the Dollar Equivalent of the daily
maximum amount available to be drawn under such Commercial Letter of Credit
(whether or not such maximum amount is then in effect under such Commercial
Letter of Credit), and (ii) for each Standby Letter of Credit equal to the
Applicable Rate times the Dollar Equivalent of the daily maximum amount
available to be drawn under such Standby Letter of Credit (whether or not such
maximum amount is then in effect under such Standby Letter of Credit). Letter of
Credit Fees shall be (A) computed on a quarterly basis in arrears and (B) due
and payable on the fifth Business Day after the end of each fiscal quarter of
the Borrower, commencing with the first such date to occur after the issuance of
such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on
demand. If there is any change in the Applicable Rate during any quarter, the
daily maximum amount of each Letter of Credit shall be computed and multiplied
by the Applicable Rate separately for each period during such quarter that such
Applicable Rate was in
46
effect. Notwithstanding anything to the contrary contained herein, upon the
request of the Required Lenders, while any Event of Default exists, all Letter
of Credit Fees shall accrue at the Default Rate.
(j) Fronting Fee and Processing Charges Payable to L/C Issuer. The
Borrower shall pay directly to the L/C Issuer for its own account a fronting fee
in Dollars or such Alternative Currency as shall be separately agreed, for each
Standby Letter of Credit equal to 0.175% per annum times the Dollar Equivalent
of the daily maximum amount available to be drawn under such Letter of Credit
(whether or not such maximum amount is then in effect under such Letter of
Credit). Such fronting fee for each Standby Letter of Credit shall be (A)
computed on a quarterly basis in arrears and (B) due and payable on the fifth
Business Day after the end of each fiscal quarter of the Borrower commencing
with the first such date to occur after the issuance of such Letter of Credit,
on the Letter of Credit Expiration Date and thereafter on demand. In addition,
the Borrower shall pay directly to the L/C Issuer for its own account the
customary issuance, presentation, amendment and other processing fees, and other
standard costs and charges, of the L/C Issuer relating to letters of credit as
from time to time in effect in Dollars or such Alternative Currency as shall be
separately agreed. Such customary fees and standard costs and charges are due
and payable on demand and are nonrefundable.
(k) Conflict with Issuer Documents. In the event of any conflict
between the terms hereof and the terms of any Issuer Documents, the terms hereof
shall control.
(l) Letters of Credit Issued for Subsidiaries. Notwithstanding
that a Letter of Credit issued or outstanding hereunder is in support of any
obligations of, or is for the account of, a Subsidiary, the Borrower shall be
obligated to reimburse the L/C Issuer hereunder for any and all drawings under
such Letter of Credit. The Borrower hereby acknowledges that the issuance of
Letters of Credit for the account of Subsidiaries inures to the benefit of the
Borrower, and that the Borrower's business derives substantial benefits from the
businesses of such Subsidiaries.
2.04 PREPAYMENTS.
(a) Voluntary Prepayments of Loans. The Borrower may, upon notice
to the Administrative Agent, at any time or from time (i) voluntarily prepay
Base Rate Loans in whole or in part without premium or penalty, and (ii) subject
to Section 3.05 hereof, voluntarily prepay Eurodollar Rate Loans in whole or in
part without premium or penalty; provided that (i) such notice must be received
by the Administrative Agent not later than 11:00 a.m. (A) three Business Days
prior to any date of prepayment of Eurodollar Rate Loans and (B) on the date of
prepayment of Base Rate Loans; (ii) any prepayment of Eurodollar Rate Loans
shall be in a principal amount of $1,000,000 or a whole multiple of $1,000,000
in excess thereof (or, if less, the entire principal amount thereof then
outstanding); (iii) any prepayment of Base Rate Loans shall be in a principal
amount of $500,000 or a whole multiple of $100,000 in excess thereof (or, if
less, the entire principal amount thereof then outstanding); and (iv) any
prepayment of the Term Loan shall be applied to remaining Principal Amortization
Payments as determined by the Borrower. Each such notice shall specify the date
and amount of such prepayment and the Type(s) of Loans to be prepaid. The
Administrative Agent will promptly notify each Lender of its receipt of each
such notice, and of the amount of such Lender's Pro Rata Share of such
47
prepayment. If such notice is given by the Borrower, the Borrower shall make
such prepayment and the payment amount specified in such notice shall be due and
payable on the date specified therein. Any prepayment of a Eurodollar Rate Loan
shall be accompanied by all accrued interest thereon, together with any
additional amounts required pursuant to Section 3.05. Each such prepayment shall
be applied to the Loans of the Lenders in accordance with their respective Pro
Rata Shares.
(b) Mandatory Prepayments.
(i) Aggregate Revolving Commitments. If for any reason
the Total Revolving Outstandings at any time exceed the Aggregate
Revolving Commitments then in effect, the Borrower shall immediately
prepay Revolving Loans and/or Cash Collateralize the L/C Obligations in
an aggregate amount equal to such excess; provided, however, that the
Borrower shall not be required to Cash Collateralize the L/C
Obligations pursuant to this Section 2.04(b)(i) unless after the
prepayment in full of the Revolving Loans the Total Revolving
Outstandings exceed the Standby Letter of Credit Sublimit or the
Commercial Letter of Credit Sublimit.
(ii) (A) Dispositions. Immediately upon the occurrence of
any Disposition Prepayment Event, the Borrower shall prepay the Loans
in an aggregate amount equal to 100% of the Net Cash Proceeds of the
related Disposition not applied (or caused to be applied) by the Loan
Parties during the related Application Period to make Eligible
Reinvestments as contemplated by the terms of Section 8.05(g) (such
prepayment to be applied as set forth in clause (v) below).
(B) Extraordinary Receipts. Immediately upon the
receipt of any Extraordinary Receipts received by or paid to
or for the account of the Borrower or any of its Subsidiaries
and not otherwise included in clauses (ii)(A), (iii) or (iv)
of this Section 2.04(b) and, in the case of Extraordinary
Receipts from an Involuntary Disposition constituting Excess
Proceeds, not applied (or caused to be applied) by the Loan
Parties during the related Application Period to make Eligible
Reinvestments as contemplated by the terms of Section 7.07(b),
the Borrower shall prepay the Loans in an aggregate amount
equal to 100% of the Excess Proceeds of the related
Involuntary Disposition (such prepayment to be applied as set
forth in clause (v) below).
(iii) Debt Issuances. Immediately upon the occurrence of a
Debt Issuance Prepayment Event, the Borrower shall prepay the Loans in
an aggregate amount equal to 100% of the Net Cash Proceeds of the
related Debt Issuance (such prepayment to be applied as set forth in
clause (v) below).
(iv) Equity Issuances. Immediately upon the occurrence of
an Equity Issuance Prepayment Event, the Borrower shall prepay the
Loans in an aggregate amount equal to 50% of the Net Cash Proceeds of
the related Equity Issuance (such prepayment to be applied as set forth
in clause (v) below).
48
(v) Application of Mandatory Prepayments. All amounts
required to be paid pursuant to this Section 2.04(b) shall be applied
as follows:
(A) with respect to all amounts prepaid pursuant to
Section 2.04(b)(i), to Revolving Loans and (after all
Revolving Loans have been repaid) to Cash Collateralize L/C
Obligations; and
(B) with respect to all amounts prepaid pursuant to
Section 2.04(b)(ii), (iii) and (iv):
(1) until the Term Loan has been paid in
full, to prepay the Term Loan (with such payment
applied to remaining Principal Amortization Payments
in inverse order of maturities thereof); and
(2) after the Term Loan has been paid in
full, to the extent outstanding, to prepay the
Revolving Loans but without any corresponding
reduction in the Aggregate Revolving Commitments;
Within the parameters of the applications set forth above,
prepayments shall be applied first to Base Rate Loans and then
to Eurodollar Rate Loans in direct order of Interest Period
maturities. All prepayments under this Section 2.04(b) shall
be subject to Section 3.05, but otherwise without premium or
penalty, and shall be accompanied by interest on the principal
amount prepaid through the date of prepayment.
(vi) Prepayment Account. If the Borrower is required to
make a mandatory prepayment of Eurodollar Rate Loans under this Section
2.04(b), the Borrower shall have the right, in lieu of making such
prepayment in full, to deposit an amount equal to such mandatory
prepayment with the Administrative Agent in a cash collateral account
maintained (pursuant to documentation reasonably satisfactory to the
Administrative Agent) by and in the sole dominion and control of the
Administrative Agent. Any amounts so deposited shall be held by the
Administrative Agent as collateral for the prepayment of such
Eurodollar Rate Loans and shall be applied to the prepayment of the
applicable Eurodollar Rate Loans at the end of the current Interest
Periods applicable thereto. At the request of the Borrower, amounts so
deposited shall be invested by the Administrative Agent in Cash
Equivalents maturing prior to the date or dates on which it is
anticipated that such amounts will be applied to prepay such Eurodollar
Rate Loans; any interest earned on such Cash Equivalents will be for
the account of the Borrower and the Borrower will deposit with the
Administrative Agent the amount of any loss on any such Cash
Equivalents to the extent necessary in order that the amount of the
prepayment to be made with the deposited amounts may not be reduced.
2.05 TERMINATION OR REDUCTION OF AGGREGATE REVOLVING COMMITMENTS.
(a) Voluntary Reductions. The Borrower may, upon notice to the
Administrative Agent, terminate the Aggregate Revolving Commitments, or from
time to time permanently
49
reduce the Aggregate Revolving Commitments; provided that (i) any such notice
shall be received by the Administrative Agent not later than 11:00 a.m. five
Business Days prior to the date of termination or reduction, (ii) any such
partial reduction shall be in an aggregate amount of $5,000,000 or any whole
multiple of $1,000,000 in excess thereof, (iii) the Borrower shall not terminate
or reduce the Aggregate Revolving Commitments if, after giving effect thereto
and to any concurrent prepayments hereunder, the Total Revolving Outstandings
would exceed the Aggregate Revolving Commitments, and (iv) if, after giving
effect to any reduction of the Aggregate Revolving Commitments, either the
Alternative Currency Sublimit, the Standby Letter of Credit Sublimit or the
Commercial Letter of Credit Sublimit exceeds the amount of the Aggregate
Revolving Commitments, the Standby Letter of Credit Sublimit or the Commercial
Letter of Credit Sublimit, as applicable, shall be automatically reduced by the
amount of such excess.
(b) General. The Administrative Agent will promptly notify the
Lenders of any such notice of termination or reduction of the Aggregate
Revolving Commitments. Any reduction of the Aggregate Revolving Commitments
shall be applied to the Revolving Commitment of each Lender according to its Pro
Rata Share. All commitment fees accrued until the effective date of any
termination of the Aggregate Revolving Commitments shall be paid on the
effective date of such termination.
2.06 REPAYMENT OF LOANS.
(a) Revolving Loans. The Borrower shall repay to the Lenders on
the Maturity Date the aggregate principal amount of Revolving Loans outstanding
on such date.
(b) Term Loan. The Borrower shall repay the outstanding principal
amount of the Term Loan in twenty (20) consecutive quarterly installments as
follows (as such installments hereafter may be adjusted as a result of
prepayments made pursuant to Section 2.04), unless accelerated sooner pursuant
to Section 9.02, with such payments to be made on the fifth Business Day after
the end of such fiscal quarter of the Borrower:
50
PAYMENT DATES PRINCIPAL AMORTIZATION PAYMENT
- -------------------------------------------------------
Q2 fiscal year 2005 $ 0
- ----------------------------------------------
Q3 fiscal year 2005 $ 0
- ----------------------------------------------
Q4 fiscal year 2005 $10,000,000
- ----------------------------------------------
Q1 fiscal year 2006 $ 0
- ----------------------------------------------
Q2 fiscal year 2006 $ 3,000,000
- ----------------------------------------------
Q3 fiscal year 2006 $ 4,000,000
- ----------------------------------------------
Q4 fiscal year 2006 $ 8,000,000
- ----------------------------------------------
Q1 fiscal year 2007 $ 0
- ----------------------------------------------
Q2 fiscal year 2007 $ 4,000,000
- ----------------------------------------------
Q3 fiscal year 2007 $ 6,000,000
- ----------------------------------------------
Q4 fiscal year 2007 $ 8,000,000
- ----------------------------------------------
Q1 fiscal year 2008 $ 2,000,000
- ----------------------------------------------
Q2 fiscal year 2008 $ 5,000,000
- ----------------------------------------------
Q3 fiscal year 2008 $ 7,000,000
- ----------------------------------------------
Q4 fiscal year 2008 $10,000,000
- ----------------------------------------------
Q1 fiscal year 2009 $ 3,000,000
- ----------------------------------------------
Q2 fiscal year 2009 $ 7,500,000
- ----------------------------------------------
Q3 fiscal year 2009 $ 7,500,000
- ----------------------------------------------
Q4 fiscal year 2009 $ 7,500,000
- ----------------------------------------------
Maturity Date $ 7,500,000
2.07 INTEREST.
(a) Subject to the provisions of subsection (b) below, (i) each
Eurodollar Rate Loan shall bear interest on the outstanding principal amount
thereof for each Interest Period at a rate per annum equal to the Eurodollar
Rate for such Interest Period plus the Applicable Rate; and (ii) each Base Rate
Loan shall bear interest on the outstanding principal amount thereof from the
applicable borrowing date at a rate per annum equal to the Base Rate plus the
Applicable Rate.
(b) (i) If any amount of principal of any Loan is not paid
when due (without regard to any applicable grace periods), whether at
stated maturity, by acceleration or otherwise, such amount shall
thereafter bear interest at a fluctuating interest rate per annum at
all times equal to the Default Rate to the fullest extent permitted by
applicable Laws.
(ii) If any amount (other than principal of any Loan)
payable by the Borrower under any Loan Document is not paid when due
(without regard to any applicable grace periods), whether at stated
maturity, by acceleration or otherwise, then, unless otherwise agreed
to by the Required Lenders, such amount shall thereafter bear interest
at a fluctuating interest rate per annum at all times equal to the
Default Rate to the fullest extent permitted by applicable Laws.
51
(iii) Upon the request of the Required Lenders, while any
other Event of Default exists, the Borrower shall pay interest on the
principal amount of all outstanding Obligations hereunder at a
fluctuating interest rate per annum at all times equal to the Default
Rate to the fullest extent permitted by applicable Laws.
(iv) Accrued and unpaid interest on past due amounts
(including interest on past due interest) shall be due and payable upon
demand.
(c) Interest on each Loan shall be due and payable in arrears on
each Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.
2.08 FEES.
In addition to certain fees described in subsections (i) and (j) of
Section 2.03:
(a) Facility Fee. The Borrower shall pay to the
Administrative Agent for the account of each Lender with a
Revolving Commitment in accordance with its Pro Rata Share, a
facility fee (the "Facility Fee") equal to the Applicable Rate
times the actual daily amount of the Aggregate Revolving
Commitments (or, if the Aggregate Revolving Commitments have
terminated, on the Outstanding Amount of all Loans and L/C
Obligations), regardless of usage. The Facility Fee shall
accrue at all times during the Availability Period (and
thereafter so long as any Loans or L/C Obligations remain
outstanding), including at any time during which one or more
of the conditions in Article V is not met, and shall be due
and payable quarterly in arrears on the fifth Business Day
after the end of each fiscal quarter of the Borrower,
commencing with the first such date to occur after the Closing
Date, and on the Maturity Date (and, if applicable, thereafter
on demand). The Facility Fee shall be calculated quarterly in
arrears, and if there is any change in the Applicable Rate
during any quarter, the actual daily amount shall be computed
and multiplied by the Applicable Rate separately for each
period during such quarter that such Applicable Rate was in
effect.
(b) Other Fees. (i) The Borrower shall pay to the
Arranger and the Administrative Agent for their own respective
accounts fees in the amounts and at the times specified in the
Fee Letter. Such fees shall be fully earned when paid and
shall not be refundable for any reason whatsoever.
(ii) The Borrower shall pay to the Lenders such
fees as shall have been separately agreed upon in writing in
the amounts and at the times so specified. Such fees shall be
fully earned when paid and shall not be refundable for any
reason whatsoever.
52
2.09 COMPUTATION OF INTEREST AND FEES.
All computations of interest for Base Rate Loans when the Base Rate is
determined by Bank of America's "prime rate" shall be made on the basis of a
year of 365 or 366 days, as the case may be, and actual days elapsed. All other
computations of fees and interest shall be made on the basis of a 360-day year
and actual days elapsed (which results in more fees or interest, as applicable,
being paid than if computed on the basis of a 365-day year). Interest shall
accrue on each Loan for the day on which the Loan is made, and shall not accrue
on a Loan, or any portion thereof, for the day on which the Loan or such portion
is paid, provided that any Loan that is repaid on the same day on which it is
made shall, subject to Section 2.11(a), bear interest for one day.
2.10 EVIDENCE OF DEBT.
(a) The Credit Extensions made by each Lender shall be evidenced
by one or more accounts or records maintained by such Lender and by the
Administrative Agent in the ordinary course of business. The accounts or records
maintained by the Administrative Agent and each Lender shall be conclusive
absent manifest error of the amount of the Credit Extensions made by the Lenders
to the Borrower and the interest and payments thereon. Any failure to so record
or any error in doing so shall not, however, limit or otherwise affect the
obligation of the Borrower hereunder to pay any amount owing with respect to the
Obligations. In the event of any conflict between the accounts and records
maintained by any Lender and the accounts and records of the Administrative
Agent in respect of such matters, the accounts and records of the Administrative
Agent shall control in the absence of manifest error. Upon the request of any
Lender made through the Administrative Agent, the Borrower shall execute and
deliver to such Lender (through the Administrative Agent) a promissory note
which shall evidence such Lender's Loans in addition to such accounts or
records. Each such promissory note shall (i) in the case of Revolving Loans, be
in the form of Exhibit B-1 (a "Revolving Note") and (ii) in the case of the Term
Loan, be in the form of Exhibit B-2 (a "Term Note"). Each Lender may attach
schedules to its Note and endorse thereon the date, Type (if applicable), amount
and maturity of its Loans and payments with respect thereto.
(b) In addition to the accounts and records referred to in
subsection (a), each Lender and the Administrative Agent shall maintain in
accordance with its usual practice accounts or records evidencing the purchases
and sales by such Lender of participations in Letters of Credit. In the event of
any conflict between the accounts and records maintained by the Administrative
Agent and the accounts and records of any Lender in respect of such matters, the
accounts and records of the Administrative Agent shall control in the absence of
manifest error.
2.11 PAYMENTS GENERALLY.
(a) All payments to be made by the Borrower shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff.
Except as otherwise expressly provided herein, all payments by the Borrower
hereunder shall be made to the Administrative Agent, for the account of the
respective Lenders to which such payment is owed, at the Administrative Agent's
Office in Dollars and in Same Day Funds not later than 2:00 p.m. on the
53
date specified herein. The Administrative Agent will promptly distribute to each
Lender its Pro Rata Share (or other applicable share as provided herein) of such
payment in like funds as received by wire transfer to such Lender's Lending
Office. All payments received by the Administrative Agent (i) after 2:00 p.m.,
in the case of payments in Dollars, or (ii) after the Applicable Time specified
by the Administrative Agent in the case of payments in an Alternative Currency,
shall in each case be deemed received on the next succeeding Business Day and
any applicable interest or fee shall continue to accrue.
(b) If any payment to be made by the Borrower shall come due on a
day other than a Business Day, payment shall be made on the next following
Business Day, and such extension of time shall be reflected in computing
interest or fees, as the case may be.
(c) Unless the Borrower or any Lender has notified the
Administrative Agent, prior to the date any payment is required to be made by it
to the Administrative Agent hereunder, that the Borrower or such Lender, as the
case may be, will not make such payment, the Administrative Agent may assume
that the Borrower or such Lender, as the case may be, has timely made such
payment and may (but shall not be so required to), in reliance thereon, make
available a corresponding amount to the Person entitled thereto. If and to the
extent that such payment was not in fact made to the Administrative Agent in
Same Day Funds, then:
(i) if the Borrower failed to make such payment, each
Lender shall forthwith on demand repay to the Administrative Agent the
portion of such assumed payment that was made available to such Lender
in Same Day Funds, together with interest thereon in respect of each
day from and including the date such amount was made available by the
Administrative Agent to such Lender to the date such amount is repaid
to the Administrative Agent in Same Day Funds at the applicable
Overnight Rate from time to time in effect; and
(ii) if any Lender failed to make such payment, such
Lender shall forthwith on demand pay to the Administrative Agent the
amount thereof in Same Day Funds, together with interest thereon for
the period from the date such amount was made available by the
Administrative Agent to the Borrower to the date such amount is
recovered by the Administrative Agent (the "Compensation Period") at a
rate per annum equal to the applicable Overnight Rate from time to time
in effect. If such Lender pays such amount to the Administrative Agent,
then such amount shall constitute such Lender's Loan included in the
applicable Borrowing. If such Lender does not pay such amount forthwith
upon the Administrative Agent's demand therefor, the Administrative
Agent may make a demand therefor upon the Borrower, and the Borrower
shall pay such amount to the Administrative Agent, together with
interest thereon for the Compensation Period at a rate per annum equal
to the rate of interest applicable to the applicable Borrowing. Nothing
herein shall be deemed to relieve any Lender from its obligation to
fulfill its Commitment or to prejudice any rights which the
Administrative Agent or the Borrower may have against any Lender as a
result of any default by such Lender hereunder.
54
A notice of the Administrative Agent to any Lender or the Borrower with
respect to any amount owing under this subsection (c) shall be conclusive,
absent manifest error.
(d) If any Lender makes available to the Administrative Agent
funds for any Loan to be made by such Lender as provided in the foregoing
provisions of this Article II, and such funds are not made available to the
Borrower by the Administrative Agent because the conditions to the applicable
Borrowing set forth in Article V are not satisfied or waived in accordance with
the terms hereof, the Administrative Agent shall return such funds (in like
funds as received from such Lender) to such Lender, without interest.
(e) The obligations of the Lenders hereunder to make Loans and to
fund participations in Letters of Credit are several and not joint. The failure
of any Lender to make any Loan or to fund any such participation on any date
required hereunder shall not relieve any other Lender of its corresponding
obligation to do so on such date, and no Lender shall be responsible for the
failure of any other Lender to so make its Loan or purchase its participation.
(f) Nothing herein shall be deemed to obligate (i) any Lender to
obtain the funds for any Loan in any particular place or manner or to constitute
a representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner or (ii) any Lender (other than the
L/C Issuer with respect to Letters of Credit denominated in any Alternative
Currency) to make any payments or Loans in any currency other than Dollars.
2.12 SHARING OF PAYMENTS.
If, other than as expressly provided elsewhere herein, any Lender shall
obtain on account of the Loans made by it, or the participations in L/C
Obligations held by it, any payment (whether voluntary, involuntary, through the
exercise of any right of set-off, or otherwise) in excess of its ratable share
(or other share contemplated hereunder) thereof, such Lender shall immediately
(a) notify the Administrative Agent of such fact, and (b) purchase from the
other Lenders such participations in the Loans made by them and/or such
subparticipations in the participations in L/C Obligations held by them, as the
case may be, as shall be necessary to cause such purchasing Lender to share the
excess payment in respect of such Loans or such participations, as the case may
be, pro rata with each of them; provided, however, that if all or any portion of
such excess payment is thereafter recovered from the purchasing Lender under any
of the circumstances described in Section 11.06 (including pursuant to any
settlement entered into by the purchasing Lender in its discretion), such
purchase shall to that extent be rescinded and each other Lender shall repay to
the purchasing Lender the purchase price paid therefor, together with an amount
equal to such paying Lender's ratable share (according to the proportion of (i)
the amount of such paying Lender's required repayment to (ii) the total amount
so recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered,
without further interest thereon. The Borrower agrees that any Lender so
purchasing a participation from another Lender may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off, but subject to Section 11.09) with respect to such participation as
fully as if such Lender were the direct creditor of the Borrower in the amount
of such participation. The Administrative Agent will keep records (which shall
be conclusive and binding in the absence of manifest error)
55
of participations purchased under this Section and will in each case notify the
Lenders following any such purchases or repayments. Each Lender that purchases a
participation pursuant to this Section shall from and after such purchase have
the right to give all notices, requests, demands, directions and other
communications under this Agreement with respect to the portion of the
Obligations purchased to the same extent as though the purchasing Lender were
the original owner of the Obligations purchased.
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 TAXES.
(a) Any and all payments by any Loan Party to or for the account
of the Administrative Agent or any Lender under any Loan Document shall be made
free and clear of and without deduction for any and all present or future taxes,
duties, levies, imposts, deductions, assessments, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the case of the
Administrative Agent and each Lender, taxes imposed on or measured by its
overall net income, and franchise and excise taxes imposed on it (in lieu of net
income taxes), as a result of a present or former connection between the
Administrative Agent or such Lender and the jurisdiction of the Governmental
Authority imposing such tax or any political subdivision or taxing authority
thereof or therein (other than any such connection arising solely from the
Administrative Agent's or such Lender's having executed, delivered or performed
its obligations or received a payment under, or enforced, this Agreement or any
other Loan Document) (all such non-excluded taxes, duties, levies, imposts,
deductions, assessments, fees, withholdings or similar charges, and liabilities
being hereinafter referred to as "Taxes"). If any Loan Party shall be required
by any Laws to deduct any Taxes from or in respect of any sum payable under any
Loan Document to the Administrative Agent or any Lender, (i) the sum payable
shall be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section),
each of the Administrative Agent and such Lender receives an amount equal to the
sum it would have received had no such deductions been made, (ii) such Loan
Party shall make such deductions, (iii) such Loan Party shall pay the full
amount deducted to the relevant taxation authority or other authority in
accordance with applicable Laws, and (iv) within 30 days after the date of such
payment, such Loan Party shall furnish to the Administrative Agent (which shall
forward the same to such Lender) the original or a certified copy of a receipt
evidencing payment thereof.
(b) In addition, the Borrower agrees to pay any and all present or
future stamp, court or documentary taxes or charges or similar levies which
arise from any payment made under any Loan Document or from the execution,
delivery, performance, enforcement or registration of, or otherwise with respect
to, any Loan Document (hereinafter referred to as "Other Taxes").
(c) If the Borrower shall be required to deduct or pay any Taxes
or Other Taxes from or in respect of any sum payable under any Loan Document to
the Administrative Agent or any Lender, the Borrower shall also pay to the
Administrative Agent or to such Lender, as the case may be, at the time interest
is paid, such additional amount that the Administrative Agent or such
56
Lender specifies is necessary to preserve the after-tax yield (after factoring
in all taxes, including taxes imposed on or measured by net income) that the
Administrative Agent or such Lender would have received if such Taxes or Other
Taxes had not been imposed.
(d) The Borrower agrees to indemnify the Administrative Agent and
each Lender for (i) the full amount of Taxes and Other Taxes (including any
Taxes or Other Taxes imposed or asserted by any jurisdiction on amounts payable
under this Section) that are paid by the Administrative Agent and such Lender
and that are the responsibility of the Borrower, (ii) amounts payable under
Section 3.01(c) and (iii) any liability (including additions to tax, penalties,
interest and expenses) arising therefrom or with respect thereto, in each case
whether or not such Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority. Payment under this subsection
(d) shall be made within 30 days after the date the Lender or the Administrative
Agent makes a demand therefor.
3.02 ILLEGALITY.
If any Lender determines that any Law has made it unlawful, or that any
Governmental Authority has asserted that it is unlawful, for any Lender or its
applicable Lending Office to make, maintain or fund Eurodollar Rate Loans, or to
determine or charge interest rates based upon the Eurodollar Rate, then, on
notice thereof by such Lender to the Borrower through the Administrative Agent,
any obligation of such Lender to make or continue Eurodollar Rate Loans or to
convert Base Rate Loans to Eurodollar Rate Loans shall be suspended until such
Lender notifies the Administrative Agent and the Borrower that the circumstances
giving rise to such determination no longer exist. Upon receipt of such notice,
the Borrower shall, upon demand from such Lender (with a copy to the
Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate
Loans of such Lender to Base Rate Loans, either on the last day of the Interest
Period therefor, if such Lender may lawfully continue to maintain such
Eurodollar Rate Loans to such day, or immediately, if such Lender may not
lawfully continue to maintain such Eurodollar Rate Loans. Upon any such
prepayment or conversion, the Borrower shall also pay accrued interest on the
amount so prepaid or converted. Each Lender agrees to designate a different
Lending Office if such designation will avoid the need for such notice and will
not, in the good faith judgment of such Lender, otherwise be materially
disadvantageous to such Lender.
3.03 INABILITY TO DETERMINE RATES.
If the Required Lenders determine that for any reason adequate and
reasonable means do not exist for determining the Eurodollar Rate for any
requested Interest Period with respect to a proposed Eurodollar Rate Loan, the
Administrative Agent will promptly so notify the Borrower and each Lender.
Thereafter, the obligation of the Lenders to make or maintain Eurodollar Rate
Loans shall be suspended until the Administrative Agent (upon the instruction of
the Required Lenders) revokes such notice. Upon receipt of such notice, the
Borrower may revoke any pending request for a Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or, failing that, will be deemed to have
converted such request into a request for a Borrowing of Base Rate Loans in the
amount specified therein.
57
3.04 INCREASED COST AND REDUCED RETURN; CAPITAL ADEQUACY; RESERVES
ON EURODOLLAR RATE LOANS.
(a) If any Lender determines that as a result of the introduction
of or any change in or in the interpretation of any Law, or such Lender's
compliance therewith, there shall be any increase in the cost to such Lender of
agreeing to make or making, funding or maintaining Eurodollar Rate Loans or (as
the case may be) issuing or participating in Letters of Credit, or a reduction
in the amount received or receivable by such Lender in connection with any of
the foregoing (excluding for purposes of this subsection (a) any such increased
costs or reduction in amount resulting from (i) Taxes or Other Taxes (as to
which Section 3.01 shall govern), (ii) changes in the basis of taxation of
overall net income or overall gross income by the United States or any foreign
jurisdiction or any political subdivision of either thereof under the Laws of
which such Lender is organized or has its Lending Office, and (iii) reserve
requirements contemplated by Section 3.04(c)), then from time to time upon
demand of such Lender (with a copy of such demand to the Administrative Agent),
the Borrower shall pay to such Lender such additional amounts as will compensate
such Lender for such increased cost or reduction.
(b) If any Lender determines that the introduction of any Law
regarding capital adequacy or any change therein or in the interpretation
thereof, or compliance by such Lender (or its Lending Office) therewith, has the
effect of reducing the rate of return on the capital of such Lender or any
corporation controlling such Lender as a consequence of such Lender's
obligations hereunder (taking into consideration its policies with respect to
capital adequacy and such Lender's desired return on capital), then from time to
time upon demand of such Lender (with a copy of such demand to the
Administrative Agent), the Borrower shall pay to such Lender such additional
amounts as will compensate such Lender for such reduction.
(c) The Borrower shall pay to each Lender, as long as such Lender
shall be required to maintain reserves with respect to liabilities or assets
consisting of or including Eurocurrency funds or deposits (currently known as
"Eurocurrency liabilities"), additional interest on the unpaid principal amount
of each Eurodollar Rate Loan equal to the actual costs of such reserves
allocated to such Loan by such Lender (as determined by such Lender in good
faith, which determination shall be conclusive), which shall be due and payable
on each date on which interest is payable on such Loan, provided the Borrower
shall have received at least 15 days' prior notice (with a copy to the
Administrative Agent) of such additional interest from such Lender. If a Lender
fails to give notice 15 days prior to the relevant Interest Payment Date, such
additional interest shall be due and payable 15 days from receipt of such
notice.
3.05 COMPENSATION FOR LOSSES.
Upon demand of any Lender (with a copy to the Administrative Agent)
from time to time, the Borrower shall promptly compensate such Lender for and
hold such Lender harmless from any loss, cost or expense incurred by it as a
result of:
(a) any continuation, conversion, payment or prepayment
of any Loan other than a Base Rate Loan on a day other than the last
day of the Interest Period for such Loan (whether voluntary, mandatory,
automatic, by reason of acceleration, or otherwise);
58
(b) any failure by the Borrower (for a reason other than
the failure of such Lender to make a Loan) to prepay, borrow, continue
or convert any Loan other than a Base Rate Loan on the date or in the
amount notified by the Borrower;
(c) any failure by the Borrower to make payment of any
Loan or drawing under any Letter of Credit (or interest due thereon)
denominated in an Alternative Currency in Dollars or such Alternative
Currency, as requested by the L/C Issuer pursuant to the terms hereof;
or
(d) any assignment of a Eurodollar Rate Loan on a day
other than the last day of the Interest Period therefor as a result of
a request by the Borrower pursuant to Section 11.16;
including any loss of anticipated profits, any foreign currency exchange losses
and any loss or expense arising from the liquidation or reemployment of funds
obtained by it to maintain such Loan or from fees payable to terminate the
deposits from which such funds were obtained. The Borrower shall also pay any
customary administrative fees charged by such Lender in connection with the
foregoing.
For purposes of calculating amounts payable by the Borrower to the Lenders under
this Section 3.05, each Lender shall be deemed to have funded each Eurodollar
Rate Loan made by it at the Eurodollar Rate for such Loan by a matching deposit
or other borrowing in the London interbank eurodollar market for a comparable
amount and for a comparable period, whether or not such Eurodollar Rate Loan was
in fact so funded.
3.06 MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION.
(a) A certificate of the Administrative Agent or any Lender
claiming compensation under this Article III and setting forth the additional
amount or amounts to be paid to it hereunder shall be conclusive in the absence
of manifest error. In determining such amount, the Administrative Agent or such
Lender may use any reasonable averaging and attribution methods.
(b) Upon any Lender's making a claim for compensation under
Section 3.01 or 3.04, the Borrower may replace such Lender in accordance with
Section 11.16.
3.07 SURVIVAL.
All of the Borrower's obligations under this Article III shall survive
termination of the Aggregate Revolving Commitments and repayment of all other
Obligations hereunder.
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ARTICLE IV
GUARANTY
4.01 THE GUARANTY.
Each of the Guarantors hereby jointly and severally guarantees to each
Lender, each Affiliate of a Lender that enters into a Swap Contract or Treasury
Management Arrangement with any Loan Party, and the Administrative Agent as
hereinafter provided, as primary obligor and not as surety, the prompt payment
of the Obligations in full when due (whether at stated maturity, as a mandatory
prepayment, by acceleration, as a mandatory cash collateralization or otherwise)
strictly in accordance with the terms thereof. The Guarantors hereby further
agree that if any of the Obligations are not paid in full when due (whether at
stated maturity, as a mandatory prepayment, by acceleration, as a mandatory cash
collateralization or otherwise), the Guarantors will, jointly and severally,
promptly pay the same, without any demand or notice whatsoever, and that in the
case of any extension of time of payment or renewal of any of the Obligations,
the same will be promptly paid in full when due (whether at extended maturity,
as a mandatory prepayment, by acceleration, as a mandatory cash
collateralization or otherwise) in accordance with the terms of such extension
or renewal.
Notwithstanding any provision to the contrary contained herein or in
any other of the Loan Documents, Swap Contracts or Treasury Management
Arrangements, the obligations of each Guarantor under this Agreement and the
other Loan Documents shall be limited to an aggregate amount equal to the
largest amount that would not render such obligations subject to avoidance under
any Debtor Relief Laws or any comparable provisions of any applicable state law.
4.02 OBLIGATIONS UNCONDITIONAL.
The obligations of the Guarantors under Section 4.01 are joint and
several, absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Loan Documents, Swap
Contracts, Treasury Management Arrangements, or any other agreement or
instrument referred to therein, or any substitution, release, impairment or
exchange of any other guarantee of or security for any of the Obligations, and,
to the fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever which might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor, it being the intent of this
Section 4.02 that the obligations of the Guarantors hereunder shall be absolute
and unconditional under any and all circumstances. Each Guarantor agrees that
such Guarantor shall have no right of subrogation, indemnity, reimbursement or
contribution against the Borrower or any other Guarantor for amounts paid under
this Article IV until such time as the Obligations have been Fully Satisfied.
Without limiting the generality of the foregoing, it is agreed that, to the
fullest extent permitted by law, the occurrence of any one or more of the
following shall not alter or impair the liability of any Guarantor hereunder,
which shall remain absolute and unconditional as described above:
(a) at any time or from time to time, without notice to
any Guarantor, the time for any performance of or compliance with any
of the Obligations shall be extended, or such performance or compliance
shall be waived;
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(b) any of the acts mentioned in any of the provisions of
any of the Loan Documents, any Swap Contract or any Treasury Management
Arrangement between any Consolidated Party and any Lender, or any
Affiliate of a Lender, or any other agreement or instrument referred to
in the Loan Documents or in such Swap Contracts or Treasury Management
Arrangement, shall be done or omitted;
(c) the maturity of any of the Obligations shall be
accelerated, or any of the Obligations shall be modified, supplemented
or amended in any respect, or any right under any of the Loan
Documents, any Swap Contract or any Treasury Management Arrangement
between any Consolidated Party and any Lender, or any Affiliate of a
Lender, or any other agreement or instrument referred to in the Loan
Documents or such Swap Contracts or Treasury Management Arrangement,
shall be waived or any other guarantee of any of the Obligations or any
security therefor shall be released, impaired or exchanged in whole or
in part or otherwise dealt with;
(d) any Lien granted to, or in favor of, the
Administrative Agent or any Lender or Lenders as security for any of
the Obligations shall fail to attach or be perfected; or
(e) any of the Obligations shall be determined to be void
or voidable (including, without limitation, for the benefit of any
creditor of any Guarantor) or shall be subordinated to the claims of
any Person (including, without limitation, any creditor of any
Guarantor).
With respect to its obligations hereunder, each Guarantor hereby
expressly waives diligence, presentment, demand of payment, protest and all
notices whatsoever, and any requirement that the Administrative Agent or any
Lender exhaust any right, power or remedy or proceed against any Person under
any of the Loan Documents, any Swap Contract or any Treasury Management
Arrangement between any Loan Party and any Lender, or any Affiliate of a Lender,
or any other agreement or instrument referred to in the Loan Documents or such
Swap Contract or Treasury Management Arrangements, or against any other Person
under any other guarantee of, or security for, any of the Obligations.
4.03 REINSTATEMENT.
The obligations of the Guarantors under this Article IV shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Obligations is rescinded or must be
otherwise restored by any holder of any of the Obligations, whether as a result
of any proceedings in bankruptcy or reorganization or otherwise, and each
Guarantor agrees that it will indemnify the Administrative Agent and each Lender
on demand for all reasonable costs and expenses (including, without limitation,
fees and expenses of counsel) incurred by the Administrative Agent or such
Lender in connection with such rescission or restoration, including any such
costs and expenses incurred in defending against any claim alleging that such
payment constituted a preference, fraudulent transfer or similar payment under
any bankruptcy, insolvency or similar law.
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4.04 CERTAIN ADDITIONAL WAIVERS.
Each Guarantor agrees that such Guarantor shall have no right of
recourse to security for the Obligations, except through the exercise of rights
of subrogation pursuant to Section 4.02 and through the exercise of rights of
contribution pursuant to Section 4.06.
4.05 REMEDIES.
The Guarantors agree that, to the fullest extent permitted by law, as
between the Guarantors, on the one hand, and the Administrative Agent and the
Lenders, on the other hand, the Obligations may be declared to be forthwith due
and payable as provided in Section 9.02 (and shall be deemed to have become
automatically due and payable in the circumstances provided in said Section
9.02) for purposes of Section 4.01 notwithstanding any stay, injunction or other
prohibition preventing such declaration (or preventing the Obligations from
becoming automatically due and payable) as against any other Person and that, in
the event of such declaration (or the Obligations being deemed to have become
automatically due and payable), the Obligations (whether or not due and payable
by any other Person) shall forthwith become due and payable by the Guarantors
for purposes of Section 4.01. The Guarantors acknowledge and agree that their
obligations hereunder are secured in accordance with the terms of the Collateral
Documents and that the Lenders may exercise their remedies thereunder in
accordance with the terms thereof.
4.06 RIGHTS OF CONTRIBUTION.
The Guarantors hereby agree as among themselves that, in connection
with payments made hereunder, each Guarantor shall have a right of contribution
from each other Guarantor in accordance with applicable Law. Such contribution
rights shall be subordinate and subject in right of payment to the Obligations
until such time as the Obligations have been Fully Satisfied, and none of the
Guarantors shall exercise any such contribution rights until the Obligations
have been Fully Satisfied.
4.07 GUARANTEE OF PAYMENT; CONTINUING GUARANTEE.
The guarantee in this Article IV is a guaranty of payment and not of
collection, is a continuing guarantee, and shall apply to all Obligations
whenever arising.
ARTICLE V
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS
5.01 CONDITIONS OF CLOSING DATE AND INITIAL CREDIT EXTENSION.
The occurrence of the Closing Date, the effectiveness of this Agreement
and the obligation of each Lender to make its initial Credit Extension hereunder
is subject to satisfaction of the following conditions precedent:
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(a) Loan Documents, Organization Documents, Etc. The
Administrative Agent's receipt of the following, each of which shall be
originals or facsimiles (followed promptly by originals) unless
otherwise specified, each properly executed by a Responsible Officer of
the signing Loan Party (if applicable), each dated the Closing Date
(or, in the case of certificates of governmental officials, a recent
date before the Closing Date) and each in form and substance
satisfactory to the Administrative Agent and each of the Lenders:
(i) executed counterparts of this Agreement and
the other Loan Documents;
(ii) a Note (or Notes, as applicable) executed by
the Borrower in favor of each Lender requesting a Note;
(iii) copies of the Organization Documents of each
Loan Party certified to be true and complete as of a recent
date by the appropriate Governmental Authority of the state or
other jurisdiction of its incorporation or organization, where
applicable, and certified by a secretary or assistant
secretary of such Loan Party to be true and correct as of the
Closing Date;
(iv) such certificates of resolutions or other
action, incumbency certificates and/or other certificates of
Responsible Officers of each Loan Party as the Administrative
Agent may require evidencing the identity, authority and
capacity of each Responsible Officer thereof authorized to act
as a Responsible Officer in connection with this Agreement and
the other Loan Documents to which such Loan Party is a party;
and
(v) such documents and certifications as the
Administrative Agent may reasonably require to evidence that
each Loan Party is duly organized or formed, and is validly
existing, in good standing and qualified to engage in business
in (A) the jurisdiction of its incorporation or organization
and (B) its principal place of business.
(b) Opinions of Counsel. The Administrative Agent shall
have received, in each case dated as of the Closing Date and in form
and substance reasonably satisfactory to the Administrative Agent:
(i) a legal opinion of Bass, Berry & Sims PLC,
special counsel for the Loan Parties; and
(ii) if required by the Administrative Agent, a
legal opinion of special local counsel for the Loan Parties
for each state in which any Mortgaged Property is located.
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(c) Personal Property Collateral. The Administrative
Agent shall have received:
(i) searches of Uniform Commercial Code filings
in the jurisdiction of the chief executive office of each Loan
Party and each jurisdiction where any Collateral is located or
where a filing would need to be made in order to perfect the
Administrative Agent's security interest in the Collateral,
copies of the financing statements on file in such
jurisdictions and evidence that no Liens exist other than
Permitted Liens;
(ii) duly executed (to the extent applicable) UCC
financing statements for each appropriate jurisdiction as is
necessary, in the Administrative Agent's sole discretion, to
perfect the Administrative Agent's security interest in the
Collateral;
(iii) searches of ownership of, and Liens on,
intellectual property of each Loan Party in the appropriate
governmental offices;
(iv) all certificates evidencing any certificated
Capital Stock pledged to the Administrative Agent pursuant to
the Security Agreement, together with duly executed in blank,
undated stock powers attached thereto (unless, with respect to
the pledged Capital Stock of any Foreign Subsidiary, such
stock powers are deemed unnecessary by the Administrative
Agent in its reasonable discretion under the law of the
jurisdiction of incorporation of such Person);
(v) duly executed notices of grant of security
interest in the form required by the Security Agreement as are
necessary, in the Administrative Agent's sole discretion, to
perfect the Administrative Agent's security interest in the
Collateral;
(vi) all instruments (including without
limitation promissory notes complying with the relevant terms
of the Security Agreement in connection with any intercompany
Indebtedness owing to a Loan Party in excess of $10,000,000 as
of the Closing Date) and chattel paper in the possession of
any of the Loan Parties, together with allonges or assignments
as may be necessary or appropriate to perfect the
Administrative Agent's security interest in the Collateral;
(vii) duly executed deposit account and securities
account control agreements, and, if applicable, consents, as
are necessary, in the Administrative Agent's sole discretion,
to perfect the Administrative Agent's security interest in the
Collateral; and
(viii) with respect to the personal property
Collateral located at the Indianapolis, Indiana distribution
center leased by Hat World, Inc., such estoppel letters,
consents and waivers from the landlords on such real property
as may be required by the Administrative Agent.
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(d) Real Property Collateral. The Administrative Agent
shall have received, in form and substance reasonably satisfactory to
the Administrative Agent:
(i) fully executed and notarized mortgages,
deeds of trust or deeds to secure debt (each, as the same may
be amended, modified, restated or supplemented from time to
time, a "Mortgage Instrument" and collectively the "Mortgage
Instruments") encumbering the fee interest of any Loan Party
in each of the Real Properties designated, in consultation
with the Administrative Agent, in Schedule 6.20(a) as a
"Mortgaged Property" (each a "Mortgaged Property" and
collectively the "Mortgaged Properties");
(ii) ALTA mortgagee title insurance policies
issued by First American Title Insurance Company or another
title insurance company approved by the Administrative Agent
(the "Mortgage Policies") with respect to each Mortgaged
Property, assuring the Administrative Agent that each of the
Mortgage Instruments creates a valid and enforceable first
priority mortgage lien on the applicable Mortgaged Property,
free and clear of all defects and encumbrances except
Permitted Liens, which Mortgage Policies shall otherwise be in
form and substance reasonably satisfactory to the
Administrative Agent and shall include such endorsements as
are reasonably requested by the Administrative Agent;
(iii) evidence as to (A) whether any Mortgaged
Property is in an area designated by the Federal Emergency
Management Agency as having special flood or mud slide hazards
(a "Flood Hazard Property") and (B) if any Mortgaged Property
is a Flood Hazard Property, (1) whether the community in which
such Mortgaged Property is located is participating in the
National Flood Insurance Program, (2) the applicable Loan
Party's written acknowledgment of receipt of written
notification from the Administrative Agent (a) as to the fact
that such Mortgaged Property is a Flood Hazard Property and
(b) as to whether the community in which each such Flood
Hazard Property is located is participating in the National
Flood Insurance Program and (3) copies of insurance policies
or certificates of insurance of the Consolidated Parties
evidencing flood insurance satisfactory to the Administrative
Agent and naming the Administrative Agent as sole loss payee
on behalf of the Lenders;
(iv) evidence reasonably satisfactory to the
Administrative Agent that each of the Mortgaged Properties,
and the uses of the Mortgaged Properties, are in compliance in
all material respects with all applicable zoning laws (the
evidence submitted as to which should include the zoning
designation (if any) made for each of the Mortgaged
Properties, the permitted uses of each such Mortgaged
Properties under such zoning designation and, if available,
zoning requirements as to parking, lot size, ingress, egress
and building setbacks);
(v) to the extent required by FIRREA, an
appraisal of each Mortgaged Property satisfying the
requirements of FIRREA; and
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(vi) to the extent requested by the
Administrative Agent, environmental reviews of each Mortgaged
Property, which reports shall be in form and substance
satisfactory to the Administrative Agent.
(e) Availability. After giving effect to the Transaction,
including the initial Credit Extensions made hereunder on the Closing
Date, the sum of (i) the Aggregate Revolving Commitments less the Total
Revolving Outstandings and (ii) cash, Cash Equivalents and Marketable
Securities of the Borrower shall be greater than or equal to
$50,000,000.
(f) Evidence of Insurance. Receipt by the Administrative
Agent of copies of insurance policies or certificates of insurance of
the Loan Parties evidencing liability and casualty insurance meeting
the requirements set forth in the Loan Documents, including, but not
limited to, naming the Administrative Agent as additional insured (in
the case of liability insurance) or lender loss payee (in the case of
hazard insurance) on behalf of the Lenders.
(g) Government Consent. Receipt by the Administrative
Agent of evidence that all governmental, shareholder and material third
party consents (including Hart-Scott-Rodino clearance) and approvals
necessary or reasonably desirable in connection with the Transaction
have been obtained, and all applicable waiting periods have expired
without any action being taken by any authority that could restrain,
prevent or impose any material adverse conditions on the Transaction or
that could seek or threaten any of the foregoing, and no law or
regulation shall be applicable which in the judgment of the
Administrative Agent could have such effect.
(h) Consummation of Transaction. The Transaction shall
have been, or simultaneously with the initial Credit Extensions shall
be, consummated substantially in accordance with the terms of the
Merger Agreement, in material compliance with applicable law and
regulatory approvals. The Lenders shall be reasonably satisfied with
the Merger Agreement and all other agreements, instruments and
documents relating to the Transaction. The Merger Agreement and such
other agreements, instruments and documents relating to the Transaction
shall not have been altered, amended or otherwise changed or
supplemented in any material respect, or any material condition therein
waived, without the prior written consent of the Administrative Agent.
The Administrative Agent shall have received a copy, certified by a
Responsible Officer of the Borrower as true and complete, of the Merger
Agreement as originally executed and delivered, together with all
exhibits and schedules.
(i) Officer's Certificates. The Administrative Agent
shall have received a certificate or certificates executed by a
Responsible Officer of the Borrower as of the Closing Date, in form and
substance satisfactory to the Administrative Agent, stating that (A)
the conditions specified in Sections 5.02(a) and (b) have been
satisfied, (B) each Loan Party is in material compliance with all
existing material financial obligations, (C) all governmental,
shareholder and material third party consents and approvals, if any,
with
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respect to the Loan Documents and the transactions contemplated
thereby have been obtained (copies of which will be delivered to the
Administrative Agent upon its request), (D) no action, suit,
investigation or proceeding is pending or, to the knowledge of the
Borrower, threatened in any court or before any arbitrator or
governmental instrumentality that purports to affect any Loan Party or
any transaction contemplated by the Loan Documents, if such action,
suit, investigation or proceeding could reasonably be expected to have
a Material Adverse Effect, (E) immediately after giving effect to the
Transaction, (1), the transactions contemplated by the Merger Agreement
have been consummated in accordance with the terms thereof and, (2) no
Default or Event of Default exists and (3) all representations and
warranties contained herein and in the other Loan Documents are true
and correct in all material respects.
(j) No Material Adverse Change. There shall not have
occurred a material adverse change in the business, assets, properties,
liabilities (actual and contingent), operations or condition (financial
or otherwise) of the (a) the Borrower and its Subsidiaries, taken as a
whole, and (b) the Acquired Company and its Subsidiaries, taken as a
whole, since January 31, 2004; provided, however, that with respect to
the Borrower and its Subsidiaries, the foregoing shall not apply to
facts, circumstances, changes or events which, prior to the Closing
Date, have been disclosed in the Borrower's public filings with the SEC
(to the extent so disclosed).
(k) Pro Forma Financial Statements. The Lenders shall
have received pro forma consolidated financial statements as to the
Borrower and its Subsidiaries, and forecasts prepared by management of
the Borrower, each in form satisfactory to the Lenders, of balance
sheets, income statements and cash flow statements on a quarterly basis
for the first year following the Closing Date and on an annual basis
for each year thereafter during the term of this Agreement.
(l) EBITDA of the Acquired Company. The Lenders shall
have received evidence satisfactory to the Arranger that the EBITDA of
the Acquired Company and its Subsidiaries on a consolidated basis for
the twelve months ended as of the most recent month end prior to the
Closing Date for which financial information is available (excluding
reductions to EBITDA associated with adjustments from management's
projections for the fiscal year ended as of January 31, 2004 up to a
maximum of $2,000,000) was not less than $22.5 million.
(m) Audited Financial Statements. The Lenders shall have
received the Audited Financial Statements for the Borrower and its
Subsidiaries and the audited financial statements of the Acquired
Company and its Subsidiaries for the fiscal year ended as of January
31, 2004.
(n) Fees. Any fees required to be paid on or before the
Closing Date shall have been paid.
(o) Attorney Costs. The Borrower shall have paid all
Attorney Costs of the Administrative Agent to the extent invoiced prior
to or on the Closing Date, plus such
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additional amounts of Attorney Costs as shall constitute its reasonable
estimate of Attorney Costs incurred or to be incurred by it through the
closing proceedings (provided that such estimate shall not thereafter
preclude a final settling of accounts between the Borrower and the
Administrative Agent).
(p) Existing Credit Agreement; LaSalle Line of Credit.
The Administrative Agent shall have received evidence, in form and
substance satisfactory to the Administrative Agent, that each of (i)
the Existing Credit Agreement and (ii) the La Salle Line of Credit has
been, or concurrently with the Closing Date is being, terminated and
any and all Liens securing obligations thereunder have been, or
concurrently with the Closing Date, are being released.
(q) Perfection Certificate. The Administrative Agent
shall have received a perfection certificate relating to the Collateral
duly completed and executed by the Borrower on behalf of each Loan
Party, such certificate to be in form and substance satisfactory to the
Administrative Agent.
(r) Accuracy of Representations and Warranties. The
representations and warranties of the Borrower and each other Loan
Party contained in Article VI or any other Loan Document, or which are
contained in any document furnished at any time under or in connection
herewith or therewith, shall be true and correct in all material
respects on and as of the Closing Date.
(s) No Default. No Default shall exist and be continuing
as of the Closing Date.
(t) Other. Receipt by the Lenders of such other
documents, instruments, agreements or information as reasonably
requested by any Lender, including, but not limited to, information
regarding litigation, tax, accounting, labor, insurance, pension
liabilities (actual or contingent), real estate leases, material
contracts, debt agreements, property ownership and contingent
liabilities of the Consolidated Parties.
5.02 CONDITIONS TO ALL CREDIT EXTENSIONS.
The obligation of each Lender to honor any Request for Credit Extension
(other than a Loan Notice requesting only a conversion of Loans to the other
Type, or a continuation of Eurodollar Rate Loans) is subject to the following
conditions precedent:
(a) The representations and warranties of the Borrower
and each other Loan Party contained in Article VI or any other Loan
Document, or which are contained in any document furnished at any time
under or in connection herewith or therewith, shall be true and correct
on and as of the date of such Credit Extension, except to the extent
that such representations and warranties specifically refer to an
earlier date, in which case they shall be true and correct as of such
earlier date, and except that for purposes of this Section 5.02, the
representations and warranties contained in subsection (a) of
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Section 6.05 shall be deemed to refer to the most recent statements
furnished pursuant to clauses (a) and (b), respectively, of Section
7.01.
(b) No Default shall exist, or would result from, such
proposed Credit Extension.
(c) There shall not have been commenced and be pending
against any Consolidated Party an involuntary case under any applicable
Debtor Relief Law, now or hereafter in effect, or any case, proceeding
or other action for the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of
such Person or for any substantial part of its Property or for the
winding up or liquidation of its affairs.
(d) The Administrative Agent and, if applicable, the L/C
Issuer shall have received a Request for Credit Extension in accordance
with the requirements hereof.
(e) In the case of a Credit Extension to be denominated
in an Alternative Currency, there shall not have occurred any change in
national or international financial, political or economic conditions
or currency exchange rates or exchange controls which in the reasonable
opinion of the Administrative Agent or the L/C Issuer (in the case of
any Letter of Credit to be denominated in an Alternative Currency)
would make it impracticable for such Credit Extension to be denominated
in the relevant Alternative Currency.
Each Request for Credit Extension (other than a Loan Notice requesting
only a conversion of Loans to the other Type or a continuation of Eurodollar
Rate Loans) submitted by the Borrower shall be deemed to be a representation and
warranty that the conditions specified in Sections 5.02(a), (b) and (c) have
been satisfied on and as of the date of the applicable Credit Extension.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
The Loan Parties represent and warrant to the Administrative Agent and
the Lenders that:
6.01 EXISTENCE, QUALIFICATION AND POWER; COMPLIANCE WITH LAWS.
Each Loan Party (a) is duly organized or formed, validly existing and
in good standing under the Laws of the jurisdiction of its incorporation or
organization, (b) has all requisite power and authority and all requisite
governmental licenses, authorizations, consents and approvals to (i) own its
assets and carry on its business and (ii) execute, deliver and perform its
obligations under the Loan Documents, if any, to which it is a party and (c) is
duly qualified and is licensed and in good standing under the Laws of each
jurisdiction where its ownership, lease or operation of properties or the
conduct of its business requires such qualification or license; except in each
case referred to in clause (b)(i) or (c), to the extent that failure to do so
could not reasonably be expected to have a Material Adverse Effect.
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6.02 AUTHORIZATION; NO CONTRAVENTION.
The execution, delivery and performance by each Loan Party of each Loan
Document to which such Person is party have been duly authorized by all
necessary corporate or other organizational action, and do not and will not (a)
contravene the terms of any of such Person's Organization Documents; (b)
conflict with or result in any breach or contravention of, or result in or
require the creation of any Lien under, (i) any Contractual Obligation to which
such Person is a party or (ii) any order, injunction, writ or decree of any
Governmental Authority or any arbitral award to which such Person or its
property is subject; or (c) violate any Law (including, without limitation,
Regulation U or Regulation X issued by the FRB).
6.03 GOVERNMENTAL AUTHORIZATION; OTHER CONSENTS.
No approval, consent, exemption, authorization, or other action by, or
notice to, or filing with, any Governmental Authority or any other Person is
necessary or required in connection with the execution, delivery or performance
by, or enforcement against, any Loan Party of this Agreement or any other Loan
Document or with the consummation of the Transaction, except for (a) consents,
authorizations, notices and filings described in Schedule 6.03, all of which
have been obtained or made or have the status described in such Schedule 6.03
and (b) filings to perfect the Liens created by the Collateral Documents.
6.04 BINDING EFFECT.
This Agreement has been, and each other Loan Document, when delivered
hereunder, will have been, duly executed and delivered by each Loan Party that
is a party thereto. This Agreement constitutes, and each other Loan Document
when so delivered will constitute, a legal, valid and binding obligation of such
Loan Party, enforceable against each Loan Party that is a party thereto in
accordance with its terms except as enforceability may be limited by applicable
Debtor Relief Laws and by general equitable principles (whether enforcement is
sought by proceedings in equity or at law).
6.05 FINANCIAL STATEMENTS; NO MATERIAL ADVERSE EFFECT.
(a) The Audited Financial Statements (i) were prepared in
accordance with GAAP consistently applied throughout the period covered thereby,
except as otherwise expressly noted therein; (ii) fairly present the financial
condition of the Consolidated Parties as of the date thereof and their results
of operations for the period covered thereby in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein; and (iii) show all material indebtedness and other
liabilities, direct or contingent, of the Consolidated Parties as of the date
thereof, including liabilities for taxes, material commitments arising outside
the ordinary course of business and Indebtedness.
(b) During the period from February 1, 2004 to and including the
Closing Date, there has been no sale, transfer or other disposition by any
Consolidated Party of any material part of the business or Property of the
Consolidated Parties, taken as a whole, and no purchase or other
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acquisition by any of them of any business or property (including any Capital
Stock of any other Person) material in relation to the consolidated financial
condition of the Consolidated Parties, taken as a whole, in each case, which is
not reflected in the foregoing financial statements or in the notes thereto and
has not otherwise been disclosed in writing to the Lenders on or prior to the
Closing Date.
(c) The pro forma consolidated balance sheet of the Consolidated
Parties as of February 28, 2004 (and using the estimated closing balance sheet
of the Acquired Company) giving effect to the Transaction in accordance with the
terms of the Merger Agreement and reflecting estimated purchase accounting
adjustments is based upon reasonable assumptions made known to the Lenders and
upon information not known to be incorrect or misleading in any material
respect.
(d) The financial statements delivered pursuant to Section 7.01(a)
and (b) have been prepared in accordance with GAAP (except as may otherwise be
permitted under Section 7.01(a) and (b)) and present fairly (on the basis
disclosed in the footnotes to such financial statements) the consolidated
financial condition, results of operations and cash flows of the Consolidated
Parties as of such date and for such periods.
(e) Since the date of the Audited Financial Statements, there has
been no event or circumstance, either individually or in the aggregate, that has
had or could reasonably be expected to have a Material Adverse Effect other than
facts, circumstances, changes or events, which, as of the Closing Date, have
been disclosed in the Borrower's public filings with the SEC (to the extent so
disclosed).
6.06 LITIGATION.
Except as specifically disclosed and described in Schedule 6.06, there
are no actions, suits, proceedings, claims or disputes pending or, to the
knowledge of the Loan Parties after due and diligent investigation, threatened
or contemplated, at law, in equity, in arbitration or before any Governmental
Authority, by or against any Consolidated Party or against any of its properties
or revenues that (a) purport to affect or pertain to this Agreement or any other
Loan Document, or any of the transactions contemplated hereby, (b) restrains the
consummation of the acquisition of the Acquired Company in the manner
contemplated by the Merger Agreement or (c) either individually or in the
aggregate, if determined adversely, could reasonably be expected to have a
Material Adverse Effect.
6.07 NO DEFAULT.
No Consolidated Party is in default under or with respect to any
Contractual Obligation that could, either individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. No Default has
occurred and is continuing or would result from the consummation of the
transactions contemplated by this Agreement or any other Loan Document.
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6.08 OWNERSHIP OF PROPERTY; LIENS.
Each Consolidated Party has good record and marketable title in fee
simple to, or valid leasehold interests in, all real property necessary or used
in the ordinary conduct of its business, except for such defects in title as
could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. The property of the Consolidated Parties is subject to
no Liens, other than Permitted Liens.
6.09 ENVIRONMENTAL COMPLIANCE.
Except as specifically disclosed and described in Schedule 6.09
attached hereto or where the existence and/or occurrence of any of the following
could not reasonably be expected to have a Material Adverse Effect:
(a) Each of the Real Properties and all operations at the
Real Properties are in compliance with all applicable Environmental
Laws, and, to the knowledge of the Responsible Officers of the Loan
Parties, there are no conditions relating to the Real Properties or the
Businesses that are likely to give rise to liability on the part of any
Consolidated Party under any applicable Environmental Laws.
(b) To the knowledge of the Responsible Officers of the
Loan Parties, none of the Real Properties contains, or has previously
contained, any Hazardous Materials at, on or under the Real Properties
in amounts or concentrations that constitute a violation of, or that
are likely to give rise to liability on the part of any Consolidated
Party under, Environmental Laws.
(c) No Consolidated Party has received any written or
verbal notice of, or inquiry from any Governmental Authority within the
last three (3) years regarding, any violation, alleged violation,
non-compliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws with regard
to any of the Real Properties or the Businesses that has not been
resolved, nor does any Responsible Officer of any Loan Party have
knowledge or reason to believe that any such notice will be received or
is being threatened.
(d) No Consolidated Party has generated, treated, stored
or disposed of Hazardous Materials at, on or under any of the Real
Properties in violation of, or in a manner that is likely to give rise
to liability on the part of any Consolidated Party under, any
applicable Environmental Law. To the knowledge of the Responsible
Officers of the Loan Parties, Hazardous Materials have not been
transported or disposed of from the Real Properties, in each case, by
or on behalf of any Consolidated Party, in violation of, or in a manner
that is likely to give rise to liability on the part of any
Consolidated Party under, any applicable Environmental Law.
(e) No judicial proceeding or governmental or
administrative action is pending or, to the knowledge of the
Responsible Officers of the Loan Parties, threatened, under any
Environmental Law to which any Consolidated Party is or will be named
as a party, nor are
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there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or
judicial requirements outstanding under any Environmental Law with
respect to the Consolidated Parties, the Real Properties or the
Businesses.
(f) To the knowledge of the Responsible Officers of the
Loan Parties, there has been no release, or threat of release, of
Hazardous Materials at or from the Real Properties, or arising from or
related to the operations (including, without limitation, disposal) of
any Consolidated Party in connection with the Real Properties or
otherwise in connection with the Businesses, in violation of or in
amounts or in a manner that could give rise to liability on the part of
any Consolidated Party under Environmental Laws.
6.10 INSURANCE.
The properties of the Borrower and its Subsidiaries are insured with
financially sound and reputable insurance companies not Affiliates of the
Borrower, in such amounts, with such deductibles and covering such risks as are
customarily carried by companies engaged in similar businesses and owning
similar properties in localities where the Borrower or the applicable Subsidiary
owns property. The insurance coverage of the Loan Parties as of the Closing Date
is outlined as to carrier, policy number, expiration date, type and amount on
Schedule 6.10.
6.11 TAXES.
Except as specifically disclosed and described in Schedule 6.11, the
Consolidated Parties have filed all Federal, state and other material tax
returns and reports required to be filed, and have paid all Federal, state and
other material taxes, assessments, fees and other governmental charges levied or
imposed upon them or their properties, income or assets otherwise due and
payable, except those which are being contested in good faith by appropriate
proceedings diligently conducted and for which adequate reserves have been
established in accordance with GAAP. To the knowledge of the Borrower, there is
no proposed tax assessment against the Borrower or any Subsidiary that would, if
made, have a Material Adverse Effect.
6.12 ERISA COMPLIANCE.
Except as specifically disclosed and described in Schedule 6.12:
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other Federal or state Laws. Each
Plan that is intended to qualify under Section 401(a) of the Code has received a
favorable determination letter from the IRS or an application for such a letter
is currently being processed by the IRS with respect thereto and, to the
knowledge of the Loan Parties, nothing has occurred which would prevent, or
cause the loss of, such qualification. Each Loan Party and each ERISA Affiliate
have made all required contributions to each Plan subject to Section 412 of the
Code, and no application for a funding waiver or an extension of any
amortization period pursuant to Section 412 of the Code has been made with
respect to any Plan.
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(b) There are no pending or, to the knowledge of the Loan Parties,
threatened claims (other than routine claims for benefits), actions or lawsuits,
or action by any Governmental Authority, with respect to any Plan that could
reasonably be expected to have a Material Adverse Effect. None of the
Consolidated Parties nor, to the knowledge of the Loan Parties, any other Person
has engaged in any prohibited transaction or violation of the fiduciary
responsibility rules under ERISA or the Code with respect to any Plan that has
resulted or could reasonably be expected to result in a Material Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to
occur; (ii) no Pension Plan has any Unfunded Pension Liability in excess of the
Threshold Amount; (iii) no Loan Party nor any ERISA Affiliate has incurred, or
reasonably expects to incur, any liability under Title IV of ERISA with respect
to any Pension Plan (other than premiums due and not delinquent under Section
4007 of ERISA); (iv) no Loan Party nor any ERISA Affiliate has incurred, or
reasonably expects to incur, any liability (and no event has occurred which,
with the giving of notice under Section 4219 of ERISA, would result in such
liability) under Sections 4201 or 4243 of ERISA with respect to a Multiemployer
Plan; and (v) no Loan Party nor any ERISA Affiliate has engaged in a transaction
that could be subject to Sections 4069 or 4212(c) of ERISA.
6.13 CAPITAL STRUCTURE/SUBSIDIARIES.
The corporate capital and ownership structure of the Consolidated
Parties as of the Closing Date after giving effect to the Transaction is as
described in Schedule 6.13(a). Set forth on Schedule 6.13(b) is a complete and
accurate list as of the Closing Date with respect to each of the Borrower's
direct and indirect Subsidiaries of the (i) jurisdiction of incorporation, (ii)
number of shares of each class of Capital Stock outstanding, (iii) number and
percentage of outstanding shares of each class of Capital Stock owned (directly
or indirectly) by the Consolidated Parties and (iv) number and effect, if
exercised, of all outstanding options, warrants, rights of conversion or
purchase and all other similar rights with respect thereto as of the Closing
Date. The outstanding Capital Stock of all such Subsidiaries is validly issued,
fully paid and non-assessable and is owned by the indicated Consolidated
Parties, directly or indirectly, in the manner set forth on Schedule 6.13(b),
free and clear of all Liens (other than those arising under or contemplated in
connection with the Loan Documents). Other than as set forth in Schedule
6.13(b), none of the Borrower's Subsidiaries has outstanding any securities
convertible into or exchangeable for its Capital Stock nor does any such Person
have outstanding any rights to subscribe for or to purchase or any options for
the purchase of, or any agreements providing for the issuance (contingent or
otherwise) of, or any calls, commitments or claims of any character relating to
its Capital Stock. As of the Closing Date, the Borrower has no equity
investments in any other Person that is not a Subsidiary constituting 5% of more
of the outstanding equity interests in such Person other than those equity
investments set forth on Schedule 6.13(c) hereto. As of the Closing Date, the
Material Subsidiaries of the Borrower are: (1) Genesco Brands, Inc. a Delaware
corporation, (2) Hat World Corporation, a Delaware corporation and (3) Hat World
Inc., a Minnesota corporation.
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6.14 MARGIN REGULATIONS; INVESTMENT COMPANY ACT; PUBLIC UTILITY
HOLDING COMPANY ACT.
(a) The Borrower is not engaged and will not engage, principally
or as one of its important activities, in the business of purchasing or carrying
margin stock (within the meaning of Regulation U issued by the FRB), or
extending credit for the purpose of purchasing or carrying margin stock.
(b) None of the Borrower, any Person Controlling the Borrower, or
any Subsidiary (i) is a "holding company," or a "subsidiary company" of a
"holding company," or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company," within the meaning of the Public Utility
Holding Company Act of 1935, (ii) is or is required to be registered as an
"investment company" under the Investment Company Act of 1940 or (iii) subject
to regulation under any other Law which limits its ability to incur the
Obligations.
6.15 DISCLOSURE.
Each Loan Party has disclosed to the Administrative Agent and the
Lenders all agreements, instruments and corporate or other restrictions to which
it or any of its Subsidiaries is subject, and all other matters known to it,
that, individually or in the aggregate, could reasonably be expected to result
in a Material Adverse Effect. No report, financial statement, certificate or
other information furnished by or on behalf of any Loan Party to the
Administrative Agent or any Lender in connection with the transactions
contemplated hereby and 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 they
were made, not misleading; provided that, with respect to projected financial
information, the Loan Parties represent only that such information was prepared
in good faith based upon assumptions believed to be reasonable at the time.
6.16 COMPLIANCE WITH LAWS.
Each Consolidated Party is in compliance in all material respects with
the requirements of all Laws and all orders, writs, injunctions and decrees
applicable to it or to its properties, except in such instances in which (a)
such requirement of Law or order, writ, injunction or decree is being contested
in good faith by appropriate proceedings diligently conducted or (b) the failure
to comply therewith, either individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.
6.17 INTELLECTUAL PROPERTY.
Each Consolidated Party owns, or has the legal right to use, all
material trademarks, service marks, trade names, trade dress, patents,
copyrights, technology, know-how and processes (the "Intellectual Property")
necessary for each of them to conduct its business as currently conducted. Set
forth on Schedule 6.17 is a list of all Intellectual Property registered or
pending registration with the United States Copyright Office or the United
States Patent and Trademark Office and owned by
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each Loan Party or that any Loan Party has the right to use as of the Closing
Date. Except as provided on Schedule 6.17, no claim has been asserted and is
pending by any Person challenging or questioning the use of the Intellectual
Property or the validity or effectiveness of the Intellectual Property, nor does
any Loan Party know of any such claim, and, to the knowledge of the Responsible
Officers of the Loan Parties, the use of the Intellectual Property by any
Consolidated Party or the granting of a right or a license in respect of the
Intellectual Property from any Consolidated Party does not infringe on the
rights of any Person, except for such claims and infringements that, in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.
As of the Closing Date, none of the Intellectual Property of the Loan Parties is
subject to any licensing agreement or similar arrangement except as set forth on
Schedule 6.17.
6.18 SOLVENCY.
The Loan Parties are Solvent on a consolidated basis.
6.19 INVESTMENTS.
All Investments of each Consolidated Party are Permitted Investments.
6.20 BUSINESS LOCATIONS.
Set forth on Schedule 6.20(a) is a list of all Real Properties located
in the United States that are owned or leased (excluding retail stores) by the
Loan Parties as of the Closing Date. Set forth on Schedule 6.20(b) is a list of
all locations (excluding retail stores) where any tangible personal property of
a Loan Party is located as of the Closing Date. Set forth on Schedule 6.20(c) is
the chief executive office, jurisdiction of incorporation or formation and
principal place of business of each Loan Party as of the Closing Date.
6.21 BROKERS' FEES.
No Consolidated Party has any obligation to any Person in respect of
any finder's, broker's, investment banking or other similar fee in connection
with any of the transactions contemplated under the Loan Documents (other than
customary advisory fees payable in connection with the Acquisition of the
Acquired Company).
6.22 LABOR MATTERS.
There are no collective bargaining agreements or Multiemployer Plans
covering the employees of a Consolidated Party as of the Closing Date and none
of the Consolidated Parties has suffered any strikes, walkouts, work stoppages
or other material labor difficulty within the last five years.
6.23 NATURE OF BUSINESS.
As of the Closing Date, the Consolidated Parties are engaged in the
business of operating mall-based specialty retail stores selling primarily
headwear and branded footwear.
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6.24 REPRESENTATIONS AND WARRANTIES FROM OTHER LOAN DOCUMENTS.
Each of the representations and warranties made by any of the Loan
Parties in any of the other Loan Documents is true and correct in all material
respects, in each case, as of the date the same was made or deemed made.
6.25 REPRESENTATIONS AND WARRANTIES FROM MERGER AGREEMENT.
As of the Closing Date, each of the representations and warranties made
in the Merger Agreement by each of the parties thereto is true and correct in
all material respects, in each case, as of the date the same was made or deemed
made.
6.26 COLLATERAL DOCUMENTS.
The provisions of the Collateral Documents are effective to create in
favor of the Administrative Agent for the benefit of the Lenders and any other
secured parties identified therein, a legal, valid and enforceable first
priority (subject to Permitted Liens) security interest in all right, title and
interest of the Borrower and its Subsidiaries in the Collateral described
therein and all proceeds thereof. Except for filings completed prior to the
Closing Date and as contemplated by this Agreement and the Collateral Documents,
no filing or other action will be necessary to perfect or protect such security
interest.
6.27 DESIGNATION AS "DESIGNATED SENIOR INDEBTEDNESS".
The Credit Extensions and all other Obligations owing hereunder
constitute "Senior Indebtedness" and/or "Designated Senior Indebtedness" (or
such other comparable terms) under the Convertible Note Indenture and any other
Subordinated Indebtedness to which such terms are applicable and the
subordination provisions set forth in all such agreements are legally valid and
enforceable against the parties thereto.
6.28 USE OF PROCEEDS.
The Borrower will use the proceeds of Credit Extensions hereunder
solely to (i) finance in part the Transaction, (ii) pay fees and expenses in
connection with the Transaction and (iii) provide ongoing working capital for,
and for other general corporate purposes of, the Borrower and its Subsidiaries.
ARTICLE VII
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder (other than Indebtedness in connection with Swap
Contracts and/or Treasury Management Arrangements) shall not be Fully Satisfied,
or any Letter of Credit shall remain outstanding, each Loan Party shall, and
shall (except in the case of the covenants set forth
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in Sections 7.01, 7.02, 7.03 and 7.11) cause each Subsidiary to:
7.01 FINANCIAL STATEMENTS.
Deliver to the Administrative Agent, in form and detail satisfactory to
the Administrative Agent and the Required Lenders:
(a) as soon as available, but in any event no later than
the earlier of (i) the 90th day after the end of each fiscal year of
the Borrower and (ii) the day that is three (3) Business Days after the
date the Borrower's annual report on Form 10-K is required to be filed
with the SEC (commencing with the 2005 fiscal year), a consolidated
balance sheet of the Consolidated Parties as at the end of such fiscal
year, and the related consolidated statements of income or operations,
shareholders' equity and cash flows for such fiscal year, setting forth
in each case in comparative form the figures for the previous fiscal
year, all in reasonable detail and prepared in accordance with GAAP,
audited and accompanied by a report and opinion of an independent
certified public accountant of nationally recognized standing
reasonably acceptable to the Required Lenders, which report and opinion
shall be prepared in accordance with generally accepted auditing
standards and shall not be subject to any "going concern" or like
qualification, exception, assumption or explanatory language or any
qualification, exception, assumption or explanatory language as to the
scope of such audit; and
(b) as soon as available, but in any event no later than
the earlier of (i) the 45th day after the end of each of the first
three fiscal quarters of each fiscal year of the Borrower and (ii) the
day that is three (3) Business Days after the date the Borrower's
quarterly report on Form 10-Q is required to be filed with the SEC
(commencing with the fiscal quarter ending April 30, 2004), a
consolidated balance sheet of the Consolidated Parties as at the end of
such fiscal quarter, and the related consolidated statements of income
or operations, shareholders' equity and cash flows for such fiscal
quarter and for the portion of the Borrower's fiscal year then ended,
setting forth in each case in comparative form the figures for the
corresponding fiscal quarter of the previous fiscal year and the
corresponding portion of the previous fiscal year, all in reasonable
detail and certified by a Responsible Officer of the Borrower as fairly
presenting the financial condition, results of operations,
shareholders' equity and cash flows of the Consolidated Parties in
accordance with GAAP, subject only to normal year-end audit adjustments
and the absence of footnotes.
7.02 CERTIFICATES; OTHER INFORMATION.
Deliver to the Administrative Agent, in form and detail satisfactory to
the Administrative Agent and the Required Lenders:
(a) concurrently with the delivery of the financial
statements referred to in Section 7.01(a), a certificate of its
independent certified public accountants certifying such financial
statements and stating that in making the examination necessary
therefor
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no knowledge was obtained of any Default under the financial covenants
set forth herein or, if any such Default shall exist, stating the
nature and status of such event;
(b) concurrently with the delivery of the financial
statements referred to in Sections 7.01(a) and (b) (commencing with the
delivery of the financial statements for the fiscal quarter ended May
1, 2004), a duly completed Compliance Certificate signed by a
Responsible Officer of the Borrower;
(c) not later than 60 days after the end of each fiscal
year of the Borrower, beginning with the 2005 fiscal year, an annual
business plan and budget of the Consolidated Parties containing, among
other things, pro forma financial statements for the next fiscal year
on a quarterly basis;
(d) within 90 days after the end of each fiscal year of
the Borrower, a certificate containing information regarding the amount
of all Dispositions (other than any Excluded Disposition), Debt
Issuances, Equity Issuances (other than Excluded Equity Issuances),
Acquisitions and Extraordinary Receipts that occurred during the prior
fiscal year;
(e) promptly after any request by the Administrative
Agent or any Lender, copies of any detailed audit reports, management
letters or recommendations submitted to the board of directors (or the
audit committee of the board of directors) of the Borrower by
independent accountants in connection with the accounts or books of the
Borrower or any Subsidiary, or any audit of any of them;
(f) promptly after the same are available, (i) copies of
each annual report, proxy or financial statement or other report or
communication sent to the stockholders of the Borrower, and copies of
all annual, regular, periodic and special reports and registration
statements which the Borrower may file or be required to file with the
SEC under Section 13 or 15(d) of the Securities Exchange Act of 1934 or
to a holder of any Indebtedness owed by any Consolidated Party in its
capacity as such holder and not otherwise required to be delivered to
the Administrative Agent pursuant hereto and (ii) upon the request of
the Administrative Agent, all reports and written information to and
from the United States Environmental Protection Agency, or any state or
local agency responsible for environmental matters, the United States
Occupational Health and Safety Administration, or any state or local
agency responsible for health and safety matters, or any successor
agencies or authorities concerning environmental, health or safety
matters;
(g) promptly upon receipt thereof, a copy of any other
report or "management letter" submitted by independent accountants to
any Consolidated Party in connection with any annual, interim or
special audit of the books of such Person; and
(h) promptly, such additional information regarding the
business, financial or corporate affairs of the Borrower or any
Subsidiary, or compliance with the terms of the Loan Documents, as the
Administrative Agent or any Lender may from time to time reasonably
request.
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Documents required to be delivered pursuant to Section 7.01(a)
or (b) or Section 7.02(c), (e), (f), (g) or (h) may be delivered
electronically and if so delivered, shall be deemed to have been
delivered on the date (i) on which the Borrower posts such documents,
or provides a link thereto, on the Borrower's website on the Internet
at the website address listed on Schedule 11.02; or (ii) on which such
documents are posted on the Borrower's behalf on an Internet or
intranet website, if any, to which each Lender and the Administrative
Agent have access (whether a commercial, third-party website or whether
sponsored by the Administrative Agent); provided that: (i) the Borrower
shall deliver paper copies of such documents to the Administrative
Agent or any Lender that requests the Borrower to deliver such paper
copies until a written request to cease delivering paper copies is
given by the Administrative Agent or such Lender and (ii) the Borrower
shall notify (which may be by facsimile or electronic mail) the
Administrative Agent and each Lender of the posting of any such
documents and provide to the Administrative Agent by electronic mail
electronic versions (i.e., soft copies) of such documents.
Notwithstanding anything contained herein, in every instance the
Borrower shall be required to provide paper copies of the Compliance
Certificates required by Section 7.02(b) to the Administrative Agent
and each of the Lenders. Except for such Compliance Certificates, the
Administrative Agent shall have no obligation to request the delivery
or to maintain copies of the documents referred to above, and in any
event shall have no responsibility to monitor compliance by the
Borrower with any such request for delivery, and each Lender shall be
solely responsible for requesting delivery to it or maintaining its
copies of such documents.
7.03 NOTICES AND INFORMATION.
(a) Promptly notify the Administrative Agent and each Lender of
the occurrence of any Default and the nature thereof.
(b) Promptly notify the Administrative Agent and each Lender of
any matter that has resulted or could reasonably be expected to result in a
Material Adverse Effect, including (i) breach or non-performance of, or any
default under, a Contractual Obligation of the Borrower or any Subsidiary; (ii)
any dispute, litigation, investigation, proceeding or suspension between the
Borrower or any Subsidiary and any Governmental Authority; or (iii) the
commencement of, or any material development in, any litigation or proceeding
affecting the Borrower or any Subsidiary, including pursuant to any applicable
Environmental Laws.
(c) Promptly notify the Administrative Agent and each Lender of
the occurrence of any ERISA Event.
(d) Promptly notify the Administrative Agent and each Lender of
any material change in accounting policies or financial reporting practices by
the Borrower or any Subsidiary.
(e) Upon the reasonable written request of the Administrative
Agent following the occurrence of any event or the discovery of any condition
which the Administrative Agent or the Required Lenders reasonably believe has
caused (or could be reasonably expected to cause) the representations and
warranties set forth in Section 6.09 to be untrue in any material respect, the
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Loan Parties will furnish or cause to be furnished to the Administrative Agent,
at the Loan Parties' expense, a report of (or updated report) an environmental
assessment of reasonable scope, form and depth (including, where reasonably
appropriate, invasive soil or groundwater sampling) by a consultant reasonably
acceptable to the Administrative Agent, as to the nature and extent of the
presence of any Hazardous Materials on any Real Properties and as to the
compliance by any Consolidated Party with Environmental Laws at such Real
Properties. If the Loan Parties fail to deliver such an environmental report
within seventy-five (75) days after receipt of such written request then the
Administrative Agent may arrange for same, and the Consolidated Parties hereby
grant to the Administrative Agent and its representatives access to the Real
Properties to reasonably undertake such an assessment (including, where
reasonably appropriate, invasive soil or groundwater sampling). The reasonable
cost of any assessment arranged for by the Administrative Agent pursuant to this
provision will be payable by the Loan Parties on demand and added to the
obligations secured by the Collateral Documents.
(f) within 15 days of the end of each calendar month, a report
detailing each Letter of Credit outstanding hereunder, including the L/C Issuer,
the amount and the beneficiary thereof, such report to be in form and substance
satisfactory to the Administrative Agent.
Each notice pursuant to this Section 7.03(a) through (d) shall be
accompanied by a statement of a Responsible Officer of the Borrower setting
forth details of the occurrence referred to therein and stating what action the
Borrower has taken and proposes to take with respect thereto. Each notice
pursuant to Section 7.03(a) shall describe with particularity any and all
provisions of this Agreement and any other Loan Document that have been
breached.
7.04 PAYMENT OF OBLIGATIONS.
Except to the extent that a failure to pay and discharge could not
reasonably be expected to have a Material Adverse Effect, pay and discharge as
the same shall become due and payable, all its obligations and liabilities,
including (a) all tax liabilities, assessments and governmental charges or
levies upon it or its properties or assets, unless the same are being contested
in good faith by appropriate proceedings diligently conducted and adequate
reserves in accordance with GAAP are being maintained by the Borrower or such
Subsidiary; (b) all lawful claims which, if unpaid, would by law become a Lien
upon its property; and (c) all Indebtedness, as and when due and payable, but
subject to any subordination provisions contained in any instrument or agreement
evidencing such Indebtedness.
7.05 PRESERVATION OF EXISTENCE, ETC.
(a) Preserve, renew and maintain in full force and effect its
legal existence and good standing under the Laws of the jurisdiction of its
organization except in a transaction permitted by Section 8.04 or 8.05; (b) take
all reasonable action to maintain all material rights, privileges, permits,
licenses and franchises necessary or desirable in the normal conduct of its
business; and (c) preserve or renew all of its material registered copyrights,
patents, trademarks, trade names and service marks.
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7.06 MAINTENANCE OF PROPERTIES.
(a) Maintain, preserve and protect all of its material properties
and equipment necessary in the operation of its business in good working order
and condition, ordinary wear and tear and Involuntary Dispositions excepted; and
(b) make all necessary repairs thereto and renewals and replacements thereof;
and (c) use the standard of care typical in the industry in the operation and
maintenance of its facilities.
7.07 MAINTENANCE OF INSURANCE.
(a) Maintain in full force and effect insurance (including
worker's compensation insurance, liability insurance and property insurance) in
such amounts, covering such risks and liabilities and with such deductibles or
self-insurance retentions as are in accordance with normal industry practice.
The Administrative Agent shall be named as lender loss payee or mortgagee, as
its interest may appear, and/or additional insured, as applicable, with respect
to any such insurance providing coverage in respect of any Collateral (excluding
executive risk policies), and each provider of any such insurance shall agree,
by endorsement upon the policy or policies issued by it or by independent
instruments furnished to the Administrative Agent, that it will give the
Administrative Agent thirty (30) days' prior written notice before any such
policy or policies shall be altered or canceled.
(b) In the event that the Consolidated Parties receive
Extraordinary Receipts in excess of $1,000,000 in aggregate amount during any
fiscal year of the Consolidated Parties ("Excess Proceeds") on account of
Involuntary Dispositions, the Loan Parties shall, within the applicable
Application Period, apply (or cause to be applied) an amount equal to such
Excess Proceeds to (i) make Eligible Reinvestments (including but not limited to
the repair or replacement of the related Property) or (ii) prepay the Loans (and
Cash Collateralize L/C Obligations) in accordance with the terms of Section
2.04(b)(ii)(B); provided, however, that such Person shall not undertake
replacement or restoration of such Property unless, after giving pro forma
effect to any Funded Indebtedness to be incurred in connection with such
replacement or restoration, the Loan Parties would be in compliance with the
financial covenants set forth in Section 8.11(a)-(c) as of the most recent
fiscal quarter end preceding the date of determination with respect to which the
Administrative Agent has received the Required Financial Information (assuming,
for purposes hereof, that such Funded Indebtedness was incurred as of the first
day of the four fiscal-quarter period ending as of such fiscal quarter end). All
insurance proceeds shall be subject to the security interest of the
Administrative Agent (for the ratable benefit of the Lenders) under the
Collateral Documents. Pending final application of any Excess Proceeds, the Loan
Parties may apply such Excess Proceeds to temporarily reduce the Revolving Loans
or to make Permitted Investments.
7.08 COMPLIANCE WITH LAWS AND MATERIAL CONTRACTUAL OBLIGATIONS.
Comply with the requirements of all Laws, all Contractual Obligations,
and all orders, writs, injunctions and decrees applicable to it or to its
business or property, except in such instances in which (a) such requirement of
Law, Contractual Obligation, or order, writ, injunction or decree is being
contested in good faith by appropriate proceedings diligently
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conducted; or (b) the failure to comply therewith could not reasonably be
expected to have a Material Adverse Effect.
7.09 BOOKS AND RECORDS.
(a) Maintain proper books of record and account, in which full,
true and correct entries in conformity with GAAP consistently applied shall be
made of all financial transactions and matters involving the assets and business
of the Borrower or such Subsidiary, as the case may be; and (b) maintain such
books of record and account in material conformity with all applicable
requirements of any Governmental Authority having regulatory jurisdiction over
the Borrower or such Subsidiary, as the case may be.
7.10 INSPECTION RIGHTS.
Permit representatives and independent contractors of the
Administrative Agent and each Lender to visit and inspect any of its properties,
to examine its corporate, financial and operating records, and make copies
thereof or abstracts therefrom, and to discuss its affairs, finances and
accounts with its directors, officers, and independent public accountants, all
at the expense of the Borrower and at such reasonable times during normal
business hours and as often as may be reasonably desired, upon reasonable
advance notice to the Borrower; provided, however, that when an Event of Default
exists the Administrative Agent or any Lender (or any of their respective
representatives or independent contractors) may do any of the foregoing at the
expense of the Borrower at any time during normal business hours and without
advance notice. The Loan Parties agree that the Administrative Agent, and its
representatives, may conduct an annual audit of the Collateral, at the expense
of the Loan Parties.
7.11 USE OF PROCEEDS.
Use the proceeds of the Credit Extensions for the purposes set forth in
Section 6.28 and for general corporate purposes not in contravention of any Law
or of any Loan Document.
7.12 ADDITIONAL GUARANTORS.
Notify the Administrative Agent at the time that any Person becomes a
Material Subsidiary and promptly thereafter (and in any event within 30 days),
cause each such Person (other than any Foreign Subsidiary to the extent the
joinder as a Guarantor by such Foreign Subsidiary could reasonably be expected
to (1) cause the undistributed earnings of such Foreign Subsidiary as determined
for United States federal income tax purposes to be treated as a deemed dividend
to such Foreign Subsidiary's United States parent or (2) result in any material
adverse tax consequences) to (i) become a Guarantor by executing and delivering
to the Administrative Agent a Joinder Agreement, and (ii) deliver to the
Administrative Agent documents of the types referred to in clauses (iii) and
(iv) of Section 5.01(a) and favorable opinions of counsel to such Person (which
shall cover, among other things, the legality, validity, binding effect and
enforceability of the documentation referred to herein), all in form, content
and scope reasonably satisfactory to the Administrative Agent.
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7.13 PLEDGED ASSETS.
(a) Each Loan Party will (i) cause all of its owned and
leased real and personal Property other than Excluded Property to be
subject at all times to first priority, perfected and, in the case of
real Property constituting Collateral (whether leased or owned), title
insured Liens in favor of the Administrative Agent to secure the
Obligations pursuant to the terms and conditions of the Collateral
Documents or, with respect to any such Property acquired subsequent to
the Closing Date, such other additional security documents as the
Administrative Agent shall reasonably request, subject in any case to
Permitted Liens and (ii) deliver such other documentation as the
Administrative Agent may reasonably request in connection with the
foregoing, including, without limitation, appropriate UCC-1 financing
statements, real estate title insurance policies, surveys,
environmental reports, landlord's waivers, certified resolutions and
other organizational and authorizing documents of such Person,
favorable opinions of counsel to such Person (which shall cover, among
other things, the legality, validity, binding effect and enforceability
of the documentation referred to above and the perfection of the
Administrative Agent's Liens thereunder) and other items of the types
required to be delivered pursuant to Section 5.01(c) and (d), all in
form, content and scope reasonably satisfactory to the Administrative
Agent. Without limiting the generality of the above, the Loan Parties
will cause (A) 100% of the issued and outstanding Capital Stock of each
Material Domestic Subsidiary and (B) 66% (or such greater percentage
that, due to a change in an applicable Law after the date hereof, (1)
could not reasonably be expected to cause the undistributed earnings of
such Foreign Subsidiary as determined for United States federal income
tax purposes to be treated as a deemed dividend to such Foreign
Subsidiary's United States parent and (2) could not reasonably be
expected to cause any material adverse tax consequences) of the issued
and outstanding Capital Stock entitled to vote (within the meaning of
Treas. Reg. Section 1.956-2(c)(2)) and 100% of the issued and
outstanding Capital Stock not entitled to vote (within the meaning of
Treas. Reg. Section 1.956-2(c)(2)) in each Foreign Subsidiary that is a
Material Subsidiary directly owned by the Borrower or any Domestic
Subsidiary to be subject at all times to a first priority, perfected
Lien in favor of the Administrative Agent pursuant to the terms and
conditions of the Collateral Documents or such other security documents
as the Administrative Agent shall reasonably request.
(b) Whenever the aggregate net book value of personal
property Collateral located at a premises leased by a Loan Party
exceeds $10,000,000, the Borrower or other relevant Loan Party will
promptly notify the Administrative Agent in writing and use
commercially reasonable efforts to promptly obtain such estoppel
letters, consents and waivers from the landlords on such real property
as may be required by the Administrative Agent.
(c) Without limiting the generality of Section 7.13(a),
each Loan Party will (i) maintain Deposit Accounts and Securities
Accounts (such terms being defined in accordance with Section 1(a) of
the Security Agreement) in compliance with the relevant provisions
contained in Section 4 of the Security Agreement and (ii) ensure that
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intercompany Indebtedness owing to a Loan Party complies with the
relevant provisions contained in Section 4 of the Security Agreement.
ARTICLE VIII
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder (other than Indebtedness in connection with Swap
Contracts and/or Treasury Management Arrangements) shall not be Fully Satisfied,
or any Letter of Credit shall remain outstanding, no Loan Party shall, nor shall
it permit any Subsidiary to, directly or indirectly:
8.01 LIENS.
Create, incur, assume or suffer to exist any Lien upon any of its
property, assets or revenues, whether now owned or hereafter acquired, other
than the following:
(a) Liens pursuant to any Loan Document;
(b) Liens existing on the date hereof and listed on
Schedule 8.01 and any renewals or extensions thereof, provided that the
property covered thereby is not increased and any renewal, refinancing
or extension of the obligations secured or benefited thereby is
permitted by Section 8.03(b);
(c) Liens (other than Liens imposed under ERISA) for
taxes, assessments or governmental charges or levies not yet delinquent
or which are being contested in good faith and by appropriate
proceedings diligently conducted, if adequate reserves with respect
thereto are maintained on the books of the applicable Person in
accordance with GAAP;
(d) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and suppliers and other Liens
imposed by law or pursuant to customary reservations or retentions of
title arising in the ordinary course of business, provided that such
Liens secure only amounts not yet due and payable or, if due and
payable, are unfiled and no other action has been taken to enforce the
same or are being contested in good faith by appropriate proceedings
for which adequate reserves determined in accordance with GAAP have
been established;
(e) pledges or deposits in the ordinary course of
business in connection with workers' compensation, unemployment
insurance and other social security legislation, other than any Lien
imposed by ERISA;
(f) deposits to secure the performance of bids, trade
contracts and leases (other than Indebtedness), statutory obligations,
surety bonds (other than bonds related to
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judgments or litigation), performance bonds and other obligations of a
like nature incurred in the ordinary course of business;
(g) easements, reservations, rights-of-way, covenants,
conditions, restrictions and other similar encumbrances affecting real
property which, in the aggregate, are not substantial in amount, and
which do not in any case materially detract from the value of the
property subject thereto or materially interfere with the ordinary
conduct of the business of the applicable Person;
(h) Liens securing judgments for the payment of money not
constituting an Event of Default under Section 9.01(h) or securing
appeal or other surety bonds related to such judgments;
(i) Liens securing Indebtedness permitted under Section
8.03(e); provided that (i) such Liens do not at any time encumber any
Property other than the Property financed by such Indebtedness, (ii)
the Indebtedness secured thereby does not exceed the cost or fair
market value, whichever is lower, of the Property acquired as of the
date of acquisition and (iii) such Liens attach to such Property
concurrently with or within 90 days after the acquisition thereof;
(j) leases or subleases granted to others not interfering
in any material respect with the business of any Consolidated Party;
(k) any interest of title of a lessor under, and Liens
arising from UCC financing statements (or equivalent filings,
registrations or agreements in foreign jurisdictions) relating to,
leases permitted by this Agreement;
(l) Liens in favor of customs and revenue authorities
arising as a matter of law to secure payment of customs duties in
connection with the importation of goods;
(m) Liens deemed to exist in connection with Investments
in repurchase agreements permitted under Section 8.02;
(n) normal and customary rights of setoff upon deposits
of cash in favor of banks or other depository institutions;
(o) Liens of a collecting bank arising under Section
4-210 of the Uniform Commercial Code on items in the course of
collection;
(p) Liens of sellers of goods to the Borrower and any of
its Subsidiaries arising under Article 2 of the Uniform Commercial Code
or similar provisions of applicable law in the ordinary course of
business, covering only the goods sold and securing only the unpaid
purchase price for such goods and related expenses;
(q) Liens arising in favor of The Bank of New York, as
trustee ("Bank of NY"), under Section 7.07 of the Convertible Note
Indenture or Liens arising in favor of the trustee
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under any indenture or similar agreement (together with the Convertible
Note Indenture, the "Indentures") with respect to the Convertible Notes
(Bank of NY, together with any such other trustee, the "Trustees");
provided that such Liens shall be limited only to property and funds
held by the Trustees and such Liens shall secure only the Borrower's
obligation to pay reasonable compensation to the Trustees for their
services under the Indentures, reasonable costs and expenses incurred
by the Trustees in connection with the performance of such services and
indemnification of the Trustees with respect to the performance of such
services under the Indentures;
(r) other Liens securing Indebtedness permitted hereunder
in an aggregate amount (with respect to the Indebtedness so secured)
not to exceed $5,000,000.
8.02 INVESTMENTS.
Make any Investments, except:
(a) Investments held by the Borrower or such Subsidiary
in the form of Cash Equivalents;
(b) Investments existing as of the Closing Date and set
forth in Schedule 8.02;
(c) Investments consisting of advances or loans to
directors, officers, employees, agents, customers or suppliers in an
aggregate principal amount (including Investments of such type set
forth in Schedule 8.02) not to exceed $1,000,000 at any time
outstanding; provided that all such advances must be in compliance with
applicable Laws, including, but not limited to, the Sarbanes-Oxley Act
of 2002.
(d) Investments in any Person which is a Loan Party prior
to giving effect to such Investment;
(e) Investments consisting of extensions of credit in the
nature of accounts receivable or notes receivable arising from the
grant of trade credit in the ordinary course of business, and
Investments received in satisfaction or partial satisfaction thereof
from financially troubled account debtors to the extent reasonably
necessary in order to prevent or limit loss;
(f) Guarantees constituting Indebtedness permitted by
Section 8.03 (other than Section 8.03(c)), to the extent such
Guarantees also constitute Investments;
(g) The Borrower and its Subsidiaries may make and own
loans or advances to Consolidated Parties that are not Loan Parties in
an aggregate amount not to exceed $5,000,000 outstanding at any one
time;
(h) any Eligible Reinvestment of the proceeds of any
Involuntary Disposition as contemplated by Section 7.07(b) or of any
Disposition as contemplated by Section 8.05(g); or
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(i) Investments consisting of an Acquisition by the
Borrower or any Subsidiary of the Borrower, provided that
(i) Same or Similar Line of Business. The
Property acquired (or the Property of the
Person acquired) in such Acquisition is used
or useful in the same or a similar line of
business as the Borrower and its
Subsidiaries were engaged in on the Closing
Date (or any reasonable extensions or
expansions thereof);
(ii) Guaranty and Collateral Requirements. The
Administrative Agent shall have received, or
in connection with the closing of such
Acquisition will receive, all items,
including in respect of the Capital Stock or
Property acquired in such Acquisition,
required to be delivered by the terms of
Section 7.12 and/or Section 7.13;
(iii) Non-Hostile. In the case of an Acquisition
of the Capital Stock of another Person, the
board of directors (or other comparable
governing body) of such other Person shall
have duly approved such Acquisition;
(iv) Pro Forma Compliance Certificate. In the
case of any Acquisition for which the
aggregate consideration (calculated in
accordance with clause (viii) below) is
equal to or greater than $3,000,000, the
Borrower shall have delivered to the
Administrative Agent (A) a Pro Forma
Compliance Certificate demonstrating that,
upon giving effect to such Acquisition on a
Pro Forma Basis, the Loan Parties would be
in compliance with the financial covenants
set forth in Section 8.11(a)-(c) as of the
most recent fiscal quarter end with respect
to which the Administrative Agent has
received the Required Financial Information
and (B) a certificate of a Responsible
Officer of the Borrower (1) demonstrating
that, upon giving effect to such
Acquisition, at least 90% of Consolidated
EBITDA for the most recently ended fiscal
year period for each of the Consolidated
Parties and the acquired Person or Property
preceding the date of such Acquisition with
respect to which the Administrative Agent
shall have received the Required Financial
Information has been audited in accordance
with GAAP, in the case of the Borrower, as
required by Section 7.01(a) and, in the case
of the acquired Person or Property, by
independent certified public accountants of
recognized national standing reasonably
acceptable to the Administrative Agent
(whose opinion shall not be limited as to
the scope or qualified as to going concern
status or any other material qualifications,
exceptions, assumptions or explanatory
language as to the scope of such audit) and
(2) to the extent that audited financial
information for the acquired Person or
Property is required under the
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terms of the foregoing clause (1),
certifying that the quarterly financial
statements with respect to the Person or
Property acquired for each fiscal quarter
period ending after the date of the last
audit and immediately prior to the date of
such Acquisition have been prepared in
accordance with GAAP (subject to audit
adjustments and the absence of footnotes)
and reviewed by independent certified public
accountants of recognized national standing
reasonably acceptable to the Administrative
Agent;
(v) Continued Accuracy of Representations and
Warranties. The representations and
warranties made by the Loan Parties in any
Loan Document shall be true and correct in
all material respects at and as if made as
of the date of such Acquisition (after
giving effect thereto) except to the extent
such representations and warranties
expressly relate to an earlier date;
(vi) Partnership Interests. If such transaction
involves the purchase of an interest in a
partnership between the Borrower (or a
Subsidiary of the Borrower) as a general
partner and entities unaffiliated with the
Borrower or such Subsidiary as the other
partners, such transaction shall be effected
by having such equity interest acquired by a
corporate holding company directly or
indirectly wholly-owned by the Borrower
newly formed for the sole purpose of
effecting such transaction;
(vii) Minimum Availability. After giving effect to
such Acquisition, there shall be at least
$25,000,000 of availability existing under
the Aggregate Revolving Commitments; and
(viii) Aggregate Consideration. The aggregate
consideration (including cash and non-cash
consideration, any assumption of
Indebtedness and any earn-out payments, but
excluding consideration consisting of (A)
any Capital Stock of the Borrower issued to
the seller of the Capital Stock or Property
acquired in such Acquisition, (B) the
proceeds of any Equity Issuance by the
Borrower consummated subsequent to the
Closing Date and (C) the proceeds of any
Disposition or Involuntary Disposition
consummated subsequent to the Closing Date)
paid by the Consolidated Parties for (i) all
such Acquisitions occurring in any rolling
twelve month period shall not exceed
$5,000,000 and (ii) for all such
Acquisitions occurring after the Closing
Date shall not exceed $25,000,000.
(j) Investments consisting of amounts potentially due
from a seller of assets in a Permitted Acquisition that (i) relate to
customary post-closing adjustments with respect to accounts receivable,
accounts payable and similar items typically subject to post-closing
adjustments in similar transactions, and (ii) are outstanding for a
period of
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one hundred eighty (180) days or less following the closing of such
Permitted Acquisition;
(k) The Borrower and its Subsidiaries may make and own
loans or advances to the trustee of various employee incentive and
stock purchase plans of the Borrower, not to exceed $250,000 in the
aggregate at any one time outstanding;
(l) The Borrower and its Subsidiaries may engage in
transactions permitted by Section 8.06.
(m) The Borrower and its Subsidiaries may make and own
other Investments (including, but not limited to acquisitions of stock
or assets of another Person but excluding any Acquisitions) not to
exceed in the aggregate $10,000,000 during the term of this Agreement.
8.03 INDEBTEDNESS.
Create, incur, assume or suffer to exist any Indebtedness, except:
(a) Indebtedness under the Loan Documents;
(b) Indebtedness of the Borrower and its Subsidiaries
outstanding on the Closing Date and set forth in Schedule 8.03 and
renewals, refinancings and extensions thereof on terms and conditions
no less favorable to such Person than such existing Indebtedness;
provided that the amount of such Indebtedness is not increased at the
time of such refinancing, refunding, renewal or extension except by an
amount equal to a reasonable premium or other reasonable amount paid,
and fees and expenses reasonably incurred, in connection with such
refinancing and by an amount equal to any existing commitments
unutilized thereunder;
(c) intercompany Indebtedness and Guarantees with respect
to Indebtedness, so long as in each case the related Investment made by
the holder of such Indebtedness or by the provider of such Guarantee,
as applicable, is permitted under Section 8.02 (other than Section
8.02(f));
(d) obligations (contingent or otherwise) of the Borrower
or any Subsidiary existing or arising under any Swap Contract, provided
that (i) such obligations are (or were) entered into by such Person in
the ordinary course of business for the purpose of directly mitigating
risks associated with liabilities, commitments, investments, assets, or
property held or reasonably anticipated by such Person, or changes in
the value of securities issued by such Person, and not for purposes of
speculation or taking a "market view;" and (ii) such Swap Contract does
not contain any provision exonerating the non-defaulting party from its
obligation to make payments on outstanding transactions to the
defaulting party;
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(e) purchase money Indebtedness (including obligations in
respect of Capital Leases or Synthetic Lease Obligations) hereafter
incurred by the Borrower or any of its Subsidiaries to finance fixed
assets, and renewals, refinancings and extensions thereof, provided
that (i) the total of all such Indebtedness for all such Persons taken
together shall not exceed an aggregate principal amount of $5,000,000
at any one time outstanding; (ii) such Indebtedness when incurred shall
not exceed the purchase price or value of the asset(s) financed; and
(iii) no such Indebtedness shall be refinanced for a principal amount
in excess of the principal balance outstanding thereon at the time of
such refinancing;
(f) Indebtedness arising under the Convertible Note
Indenture and the Convertible Notes in an aggregate principal amount
not to exceed $86,250,000 at any one time outstanding;
(g) other Subordinated Indebtedness hereafter incurred by
the Borrower or any of its Subsidiaries provided that (A) the loan
documentation with respect to such Subordinated Indebtedness shall not
contain covenants or default provisions relating to any Consolidated
Party that are more restrictive than the covenants and default
provisions contained in the Loan Documents, (B) the Borrower shall have
delivered to the Administrative Agent a Pro Forma Compliance
Certificate demonstrating that, upon giving effect on a Pro Forma Basis
to the incurrence of such Subordinated Indebtedness and to the
concurrent retirement of any other Indebtedness of any Consolidated
Party, the Loan Parties would be in compliance with the financial
covenants set forth in Section 8.11(a)-(c) as of the most recent fiscal
quarter end with respect to which the Administrative Agent has received
the Required Financial Information, (C) the aggregate principal amount
of such Subordinated Indebtedness shall not exceed $100,000,000 at any
time and (D) the Borrower or such Subsidiary shall apply (or cause to
be applied) an amount equal to the Net Cash Proceeds from such
Subordinated Indebtedness to prepay the Loans (and Cash Collateralize
L/C Obligations) in accordance with the terms of Section 2.04(b)(iii);
and
(h) other Indebtedness hereafter incurred by the Borrower
or any of its Subsidiaries provided that (A) the loan documentation
with respect to such Indebtedness shall not contain covenants or
default provisions relating to any Consolidated Party that are more
restrictive than the covenants and default provisions contained in the
Loan Documents, (B) the Borrower shall have delivered to the
Administrative Agent a Pro Forma Compliance Certificate demonstrating
that, upon giving effect on a Pro Forma Basis to the incurrence of such
Indebtedness and to the concurrent retirement of any other Indebtedness
of any Consolidated Party, the Loan Parties would be in compliance with
the financial covenants set forth in Section 8.11(a)-(c) as of the most
recent fiscal quarter end with respect to which the Administrative
Agent has received the Required Financial Information and (C) the
aggregate principal amount of such Indebtedness shall not exceed
$15,000,000 at any time; and
(i) financed insurance premiums not past due.
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8.04 FUNDAMENTAL CHANGES.
Except in connection with an Excluded Disposition, merge, dissolve,
liquidate, consolidate with or into another Person, or Dispose of (whether in
one transaction or in a series of transactions) all or substantially all of its
assets (whether now owned or hereafter acquired) to or in favor of any Person;
provided that, notwithstanding the foregoing provisions of this Section 8.04 but
subject to the terms of Sections 7.12 and 7.13, (a) the Borrower may merge or
consolidate with any of its Subsidiaries provided that the Borrower shall be the
continuing or surviving corporation, (b) any Loan Party other than the Borrower
may merge or consolidate with any other Loan Party other than the Borrower, (c)
any Consolidated Party which is not a Loan Party may be merged or consolidated
with or into any Loan Party provided that such Loan Party shall be the
continuing or surviving corporation, (d) any Consolidated Party which is not a
Loan Party may be merged or consolidated with or into any other Consolidated
Party which is not a Loan Party, (e) any Subsidiary of the Borrower may merge
with any Person that is not a Loan Party in connection with a Disposition
permitted under Section 8.05, (f) the Borrower or any Subsidiary of the Borrower
may merge with any Person other than a Consolidated Party in connection with a
Permitted Acquisition provided that, if such transaction involves the Borrower,
the Borrower shall be the continuing or surviving corporation and (g) any Wholly
Owned Subsidiary of the Borrower other than Hat World Corporation may dissolve,
liquidate or wind up its affairs at any time provided that such dissolution,
liquidation or winding up, as applicable, could not reasonably be expected to
have a Material Adverse Effect.
8.05 DISPOSITIONS.
Make any Disposition other than an Excluded Disposition unless (a) the
consideration paid in connection therewith shall be in cash or Cash Equivalents,
such payment to be substantially contemporaneous with consummation of
transaction, and shall be in an amount not less than the fair market value of
the Property disposed of, (b) if such transaction is a Sale and Leaseback
Transaction, such transaction is not prohibited by the terms of Section 8.16,
(c) such transaction does not involve the sale or other disposition of a
minority equity interest in any Consolidated Party, (d) such transaction does
not involve a sale or other disposition of receivables other than receivables
owned by or attributable to other Property concurrently being disposed of in a
transaction otherwise permitted under this Section 8.05, (e) the aggregate net
book value of all of the assets sold or otherwise disposed of by the
Consolidated Parties in all such transactions after the Closing Date shall not
exceed (i) $20,000,000 during the term of this Agreement and (ii) $10,000,000
during any rolling twelve month period, (f) no later than five (5) Business Days
prior to the consummation of any such Disposition of assets with a net book
value of $10,000,000 or more, the Borrower shall have delivered to the
Administrative Agent (i) a Pro Forma Compliance Certificate demonstrating that,
upon giving effect on a Pro Forma Basis to such transaction, the Loan Parties
would be in compliance with the financial covenants set forth in Section
8.11(a)-(c) as of the most recent fiscal quarter end with respect to which the
Administrative Agent has received the Required Financial Information and (ii) a
certificate of a Responsible Officer of the Borrower specifying the anticipated
date of such Disposition, briefly describing the assets to be sold or otherwise
disposed of and setting forth the net book value of such assets, the aggregate
consideration and the Net Cash Proceeds to be received for such assets in
connection with such Disposition and (g) the Loan Parties shall comply with the
terms of Section 2.04(b)(ii)(A). Pending
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final application of the Net Cash Proceeds of any Disposition, the Consolidated
Parties may apply such Net Cash Proceeds to temporarily reduce the Revolving
Loans or to make Investments in Cash Equivalents.
8.06 RESTRICTED PAYMENTS.
Declare or make, directly or indirectly, any Restricted Payment, or
incur any obligation (contingent or otherwise) to do so, except that:
(a) each Subsidiary may make Restricted Payments payable
ratably to holders of its Capital Stock;
(b) the Borrower and each Subsidiary may declare and make
dividend payments or other distributions payable solely in the Capital
Stock of such Person;
(c) the Borrower may purchase, redeem or otherwise
acquire shares of its Capital Stock by exchange for or out of the
proceeds received from a substantially concurrent issue of shares of
its Capital Stock;
(d) after giving effect to the relevant Restricted
Payment(s) on a Pro Forma Basis, the Borrower may (x) declare and make
dividend payments in respect of its Capital Stock and/or (y) repurchase
shares of its Capital Stock, if the cumulative amount of all such
Restricted Payments (including any Restricted Payment proposed to be
made) after the Closing Date would not exceed 25% of cumulative
Consolidated Net Income (to the extent positive) from the Closing Date
to the end of the accounting month immediately preceding the date of
the action by the board of directors of the Borrower declaring or
authorizing the relevant Restricted Payment(s), taken as a single
period;
(e) The Borrower may make Restricted Payments with
respect to the Borrower's Preferred Stock in an amount not to exceed
$400,000 in any fiscal year; and
(f) The Borrower may make redemptions, purchases or
acquisitions for value of Shareholder Rights at a price not to exceed
$.05 per Shareholder Right or $2,000,000 in the aggregate for all such
Shareholder Rights.
8.07 CHANGE IN NATURE OF BUSINESS.
Engage in any material line of business substantially different from
those lines of business conducted by the Borrower and its Subsidiaries on the
date hereof or any business substantially related or incidental thereto (or any
reasonable extensions or expansions thereof).
8.08 TRANSACTIONS WITH AFFILIATES AND INSIDERS.
Enter into or permit to exist any transaction or series of transactions
with any officer, director or Affiliate of such Person other than (a) advances
to any Loan Party, (b) transfers of cash and assets to any Loan Party, (c)
intercompany transactions expressly permitted by Section 8.02,
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Section 8.03, Section 8.04, Section 8.05 or Section 8.06, (d) normal
compensation and reimbursement of expenses of officers and directors and (e)
except as otherwise specifically limited in this Agreement, other transactions
which are entered into in the ordinary course of such Person's business on terms
and conditions substantially as favorable to such Person as would be obtainable
by it in a comparable arms-length transaction with a Person other than an
officer, director or Affiliate.
8.09 BURDENSOME AGREEMENTS.
(a) Enter into any Contractual Obligation that encumbers or
restricts the ability of any such Person to (i) pay dividends or make any other
distributions to any Loan Party on such Person's Capital Stock or with respect
to any other interest or participation in, or measured by, its profits, (ii) pay
any Indebtedness or other obligation owed to any Loan Party, (iii) make loans or
advances to any Loan Party, (iv) sell, lease or transfer any of its Property to
any Loan Party or (v) except in respect of any Consolidated Party which is not a
Loan Party, (A) pledge its Property (other than Excluded Property) pursuant to
the Loan Documents or any renewals, refinancings, exchanges, refundings or
extension thereof or (B) act as a Loan Party pursuant to the Loan Documents or
any renewals, refinancings, exchanges, refundings or extension thereof, except
(in respect of any of the matters referred to in clauses (a)(i)-(v)(A) above)
for (1) this Agreement and the other Loan Documents, (2) the Convertible Note
Indenture and the Convertible Notes, in each case as in effect as of the Closing
Date, (3) any document or instrument governing Indebtedness incurred pursuant to
Section 8.03(e), provided that any such restriction contained therein relates
only to the asset or assets constructed, acquired or financed in connection
therewith, (4) any Permitted Lien or any document or instrument governing any
Permitted Lien, provided that any such restriction contained therein relates
only to the asset or assets subject to such Permitted Lien or (5) customary
restrictions and conditions contained in any agreement relating to the sale of
any Property permitted under Section 8.05 pending the consummation of such sale.
(b) Enter into any Contractual Obligation that prohibits or
otherwise restricts the existence of any Lien upon any of its Property in favor
of the Administrative Agent (for the benefit of the Lenders) for the purpose of
securing the Obligations, whether now owned or hereafter acquired, or requiring
the grant of any security for any obligation if such Property is given as
security for the Obligations, except (i) any document or instrument governing
Indebtedness incurred pursuant to Section 8.03(e), provided that any such
restriction contained therein relates only to the asset or assets constructed or
acquired in connection therewith, (ii) in connection with any Permitted Lien or
any document or instrument governing any Permitted Lien, provided that any such
restriction contained therein relates only to the asset or assets subject to
such Permitted Lien and (iii) pursuant to customary restrictions and conditions
contained in any agreement relating to the sale of any Property permitted under
Section 8.05, pending the consummation of such sale.
8.10 USE OF PROCEEDS.
Use the proceeds of any Credit Extension, whether directly or
indirectly, and whether immediately, incidentally or ultimately, to purchase or
carry margin stock (within the meaning of
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Regulation U of the FRB) or to extend credit to others for the purpose of
purchasing or carrying margin stock or to refund indebtedness originally
incurred for such purpose.
8.11 FINANCIAL COVENANTS.
(a) Consolidated Tangible Net Worth. Permit Consolidated Tangible
Net Worth at any time to be less than the sum of (a) 85% of Consolidated
Tangible Net Worth of the Borrower, the Acquired Company and their respective
Subsidiaries as of February 1, 2004, (b) an amount equal to 50% of the
Consolidated Net Income earned in each full fiscal year ending after February 1,
2004 (with no deduction for a net loss in any such fiscal year) and (c) an
amount equal to 100% of the Net Cash Proceeds of any Equity Issuances other than
Excluded Equity Issuances (such increases pursuant to clauses (b) and (c) to be
cumulative).
(b) Consolidated Adjusted Debt to Consolidated EBITDAR Ratio. As
of the end of any fiscal quarter of the Borrower, permit the ratio of (i)
Consolidated Adjusted Debt as of such date to (ii) Consolidated EBITDAR for the
four fiscal quarter period then ended to be greater than the ratio set forth
below opposite such quarter:
Fiscal Quarter Ending Maximum Ratio
- --------------------- -------------
Q1 FY05 - Q4 FY05 4.35 to 1.00
Q1 FY06 - Q4 FY06 4.25 to 1.00
Q1 FY07 - Q4 FY07 4.00 to 1.00
Q1 FY08 and thereafter 3.75 to 1.00
(c) Fixed Charge Coverage Ratio. Permit the Consolidated Fixed
Charge Coverage Ratio as of the end of any fiscal quarter of the Borrower to be
less than the ratio set forth below opposite such fiscal quarter:
Fiscal Quarter Ending Minimum Ratio
- --------------------- -------------
Q1 FY05 - Q2 FY06 1.40 to 1.00
Q3 FY06 - Q2 FY07 1.45 to 1.00
Q3 FY07 and thereafter 1.50 to 1.00
8.12 CAPITAL EXPENDITURES.
Make or become legally obligated to make any expenditure in respect of
the purchase or other acquisition of any fixed or capital asset (excluding
normal replacements and maintenance which are properly charged to current
operations), except for capital expenditures in the ordinary course of business
not exceeding, in the aggregate for the Borrower and it Subsidiaries during each
fiscal year set forth below, the amount set forth opposite such fiscal year:
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FISCAL YEAR AMOUNT
- ------------------- -----------
2005 $49,000,000
2006 $42,000,000
2007 $45,000,000
2008 and thereafter $50,000,000
; provided, however, that so long as no Default has occurred and is continuing
or would result from such expenditure, any portion of any amount set forth above
not to exceed $3,000,000 per fiscal year, if not expended in the fiscal year for
which it is permitted above, may be carried over for expenditure in the
immediately succeeding fiscal year.
8.13 PREPAYMENT OF OTHER INDEBTEDNESS, ETC.
Permit any Consolidated Party to (a) if any Default or Event of Default
has occurred and is continuing or would be directly or indirectly caused as a
result thereof, (i) amend or modify any of the terms of any Indebtedness of such
Consolidated Party (other than Indebtedness under the Loan Documents) if such
amendment or modification would add or change any terms in a manner materially
adverse to such Consolidated Party, or shorten the final maturity or average
life to maturity or require any payment to be made sooner than originally
scheduled or increase the interest rate applicable thereto, or (ii) make (or
give any notice with respect thereto) any voluntary, optional or other
non-scheduled payment, prepayment, redemption, acquisition for value (including
without limitation, by way of depositing money or securities with the trustee
with respect thereto before due for the purpose of paying when due), refund,
refinance or exchange of any Indebtedness of such Consolidated Party (other than
Indebtedness under the Loan Documents) (in each case, whether or not mandatory),
(b) amend or modify any of the terms of any Subordinated Indebtedness if such
amendment or modification would add or change any terms in a manner materially
adverse to the Consolidated Parties, or shorten the final maturity or average
life to maturity thereof or require any payment to be made sooner than
originally scheduled or increase the interest rate applicable thereto or change
any subordination provision thereof, (c) make principal or interest payments in
respect of any Subordinated Indebtedness in violation of the subordination
provisions thereof, or (d) make (or give any notice with respect thereto) any
voluntary or optional payment or prepayment, redemption, acquisition for value
or defeasance of (including without limitation, by way of depositing money or
securities with the trustee with respect thereto before due for the purpose of
paying when due), refund, refinance or exchange of any Subordinated
Indebtedness.
8.14 ORGANIZATION DOCUMENTS; FISCAL YEAR.
Permit any Consolidated Party to (a) amend, modify or change its
Organization Documents in a manner adverse to the Lenders or (b) change its
fiscal year.
8.15 OWNERSHIP OF SUBSIDIARIES.
Notwithstanding any other provisions of this Agreement to the contrary,
permit any Consolidated Party to (i) permit any Person (other than the Borrower
or any Wholly Owned Subsidiary of the Borrower) to own any Capital Stock of any
Subsidiary of the Borrower, except (A) to qualify directors where required by
applicable law or to satisfy other requirements of
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applicable law with respect to the ownership of Capital Stock of Foreign
Subsidiaries or (B) as a result of or in connection with a dissolution, merger,
consolidation or disposition of a Subsidiary not prohibited by Section 8.04 or
Section 8.05, (ii) permit any Subsidiary of the Borrower to issue or have
outstanding any shares of preferred Capital Stock or (iii) permit, create,
incur, assume or suffer to exist any Lien on any Capital Stock of any Subsidiary
of the Borrower, except for Permitted Liens.
8.16 SALE LEASEBACKS.
Except in a transaction structured as a Capital Lease or a Synthetic
Lease Obligation and permitted by Section 8.03(e), permit any Consolidated Party
to enter into any Sale and Leaseback Transaction.
ARTICLE IX
EVENTS OF DEFAULT AND REMEDIES
9.01 EVENTS OF DEFAULT.
Any of the following shall constitute an Event of Default:
(a) Non-Payment. The Borrower or any other Loan Party
fails to pay (i) when and as required to be paid herein and in the
currency required hereunder, any amount of principal of any Loan or any
L/C Obligation, or (ii) within three days after the same becomes due,
any interest on any Loan or on any L/C Obligation, any fee due
hereunder or any other amount payable hereunder or under any other Loan
Document; or
(b) Specific Covenants. The Borrower fails to perform or
observe any term, covenant or agreement contained in any of Section
7.01, 7.02, 7.03, 7.05, 7.10, 7.11, 7.12 or 7.13 or Article VIII; or
(c) Other Defaults. Any Loan Party fails to perform or
observe any other covenant or agreement (not specified in subsection
(a) or (b) above) contained in any Loan Document on its part to be
performed or observed and such failure continues for 30 days after the
earlier of a Responsible Officer of the Borrower becoming aware of such
default or notice thereof by the Administrative Agent or any Lender; or
(d) Representations and Warranties. Any representation,
warranty, certification or statement of fact made or deemed made by or
on behalf of the Borrower or any other Loan Party herein, in any other
Loan Document, or in any document delivered in connection herewith or
therewith shall be incorrect or misleading in any material respect when
made or deemed made; or
(e) Cross-Default. (i) The Borrower or any Subsidiary (A)
fails to perform or observe (beyond the applicable grace or cure period
with respect thereto, if any) any Contractual Obligation if such
failure could reasonably be expected to have a Material
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Adverse Effect, (B) fails to make any payment when due (whether by
scheduled maturity, required prepayment, acceleration, demand, or
otherwise) in respect of any Indebtedness or Guarantee (other than
Indebtedness hereunder and Indebtedness under Swap Contracts) having an
aggregate principal amount (including undrawn committed or available
amounts and including amounts owing to all creditors under any combined
or syndicated credit arrangement) of more than the Threshold Amount, or
(C) fails to observe or perform any other agreement or condition
relating to any such Indebtedness or Guarantee or contained in any
instrument or agreement evidencing, securing or relating thereto, or
any other event occurs, the effect of which default or other event is
to cause, or to permit the holder or holders of such Indebtedness or
the beneficiary or beneficiaries of such Guarantee (or a trustee or
agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, with the giving of notice if required, such
Indebtedness to be demanded or to become due or to be repurchased,
prepaid, defeased or redeemed (automatically or otherwise), or an offer
to repurchase, prepay, defease or redeem such Indebtedness to be made,
prior to its stated maturity, or such Guarantee to become payable or
cash collateral in respect thereof to be demanded; or (ii) there occurs
under any Swap Contract an Early Termination Date (as defined in such
Swap Contract) resulting from (A) any event of default under such Swap
Contract as to which the Borrower or any Subsidiary is the Defaulting
Party (as defined in such Swap Contract) or (B) any Termination Event
(as so defined) under such Swap Contract as to which the Borrower or
any Subsidiary is an Affected Party (as so defined) and, in either
event, the Swap Termination Value owed by the Borrower or such
Subsidiary as a result thereof is greater than the Threshold Amount; or
(f) Insolvency Proceedings, Etc. Any Loan Party or any of
its Subsidiaries institutes or consents to the institution of any
proceeding under any Debtor Relief Law, or makes an assignment for the
benefit of creditors; or applies for or consents to the appointment of
any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer for it or for all or any material part
of its property; or any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer is appointed without the
application or consent of such Person and the appointment continues
undischarged or unstayed for 60 calendar days; or any proceeding under
any Debtor Relief Law relating to any such Person or to all or any
material part of its property is instituted without the consent of such
Person and continues undismissed or unstayed for 60 calendar days, or
an order for relief is entered in any such proceeding; or
(g) Inability to Pay Debts; Attachment. (i) The Borrower
or any Subsidiary becomes unable or admits in writing its inability or
fails generally to pay its debts as they become due, or (ii) any writ
or warrant of attachment or execution or similar process in an amount
in excess of the Threshold Amount is issued or levied against all or
any material part of the property of any such Person and is not
released, vacated or fully bonded within 30 days after its issue or
levy; or
(h) Judgments. There is entered against the Borrower or
any Subsidiary (i) any one or more final judgments or orders for the
payment of money in an aggregate amount exceeding the Threshold Amount
(to the extent not covered by independent
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third-party insurance as to which the insurer does not dispute
coverage), or (ii) any one or more non-monetary final judgments that
have, or could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect and, in either case, (A)
enforcement proceedings are commenced by any creditor upon such
judgment or order, or (B) there is a period of 30 consecutive days
during which a stay of enforcement of such judgment, by reason of a
pending appeal or otherwise, is not in effect; or
(i) ERISA. (i) An ERISA Event occurs with respect to a
Pension Plan or Multiemployer Plan which has resulted or could
reasonably be expected to result in liability of the Borrower under
Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC
in an aggregate amount in excess of the Threshold Amount, or (ii) the
Borrower or any ERISA Affiliate fails to pay when due, after the
expiration of any applicable grace period, any installment payment with
respect to its withdrawal liability under Section 4201 of ERISA under a
Multiemployer Plan in an aggregate amount in excess of the Threshold
Amount; or
(j) Invalidity of Loan Documents; Guarantees. (i) Any
Loan Document, at any time after its execution and delivery and for any
reason other than as expressly permitted hereunder or satisfaction in
full of all the Obligations, ceases to be in full force and effect; or
any Loan Party or any other Person contests in any manner the validity
or enforceability of any Loan Document; or any Loan Party denies that
it has any or further liability or obligation under any Loan Document,
or purports to revoke, terminate or rescind any Loan Document; or (ii)
except as the result of or in connection with a dissolution, merger or
disposition of a Subsidiary not prohibited by Section 8.04 or Section
8.05, the Guaranty given by any Guarantor hereunder or any provision
thereof shall cease to be in full force and effect, or any Guarantor
hereunder or any Person acting by or on behalf of such Guarantor shall
deny or disaffirm such Guarantor's obligations under its Guaranty, or
any Guarantor shall default in the due performance or observance of any
term, covenant or agreement on its part to be performed or observed
pursuant to its Guaranty; or
(k) Subordinated Indebtedness. (i) Any of the Obligations
for any reason shall cease to be "Designated Senior Indebtedness" (or
any comparable term) under, and as defined in, the documents evidencing
or governing any Subordinated Indebtedness, (ii) any Indebtedness other
than the Obligations shall constitute "Designated Senior Indebtedness"
(or any comparable term) under, and as defined in, the documents
evidencing or governing any Subordinated Indebtedness or (iii) the
subordination provisions of the documents evidencing or governing any
Subordinated Indebtedness shall, in whole or in part, terminate, cease
to be effective or cease to be legally valid, binding and enforceable
against any holder of the applicable Subordinated Indebtedness; or
(l) Change of Control. There occurs any Change of
Control.
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9.02 REMEDIES UPON EVENT OF DEFAULT.
If any Event of Default occurs and is continuing, the Administrative
Agent shall, at the request of, or may, with the consent of, the Required
Lenders, take any or all of the following actions:
(a) declare the commitment of each Lender to make Loans
and any obligation of the L/C Issuer to make L/C Credit Extensions to
be terminated, whereupon such commitments and obligation shall be
terminated;
(b) declare the unpaid principal amount of all
outstanding Loans, all interest accrued and unpaid thereon, and all
other amounts owing or payable hereunder or under any other Loan
Document to be immediately due and payable, without presentment,
demand, protest or other notice of any kind, all of which are hereby
expressly waived by the Borrower;
(c) require that the Borrower Cash Collateralize the L/C
Obligations (in an amount equal to the then Outstanding Amount
thereof); and
(d) exercise on behalf of itself and the Lenders all
rights and remedies available to it and the Lenders under the Loan
Documents or applicable law;
provided, however, that upon the occurrence of an actual or deemed
entry of an order for relief with respect to the Borrower under the
Bankruptcy Code of the United States, the obligation of each Lender to
make Loans and any obligation of the L/C Issuer to make L/C Credit
Extensions shall automatically terminate, the unpaid principal amount
of all outstanding Loans and all interest and other amounts as
aforesaid shall automatically become due and payable, and the
obligation of the Borrower to Cash Collateralize the L/C Obligations as
aforesaid shall automatically become effective, in each case without
further act of the Administrative Agent or any Lender.
9.03 APPLICATION OF FUNDS.
After the acceleration of the Obligations as provided for in Section
9.02(b) (or after the Loans have automatically become immediately due and
payable and the L/C Obligations have automatically been required to be Cash
Collateralized as set forth in the proviso to Section 9.02), any amounts
received by the Administrative Agent on account of the Obligations shall be
applied by the Administrative Agent in the following order:
First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including Attorney Costs and amounts
payable under Article III) payable to the Administrative Agent in its capacity
as such;
Second, to payment of that portion of the Obligations constituting
fees, indemnities and other amounts (other than principal and interest) payable
to the Lenders (including Attorney
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Costs and amounts payable under Article III), ratably among them in proportion
to the amounts described in this clause Second payable to them;
Third, to payment of that portion of the Obligations constituting
accrued and unpaid interest on the Loans, L/C Borrowings and other Obligations,
ratably among the Lenders in proportion to the respective amounts described in
this clause Third payable to them;
Fourth, to payment of that portion of the Obligations constituting
unpaid principal of the Loans, L/C Borrowings and Swap Contracts or Treasury
Management Arrangements between any Loan Party and any Lender of Affiliate of
any Lender and to Cash Collateralize the undrawn amounts of Letters of Credit,
ratably among the Lenders in proportion to the respective amounts described in
this clause Fourth held by them;
Last, the balance, if any, after all of the Obligations have been
indefeasibly paid in full, to the Borrower or as otherwise required by Law.
Subject to Section 2.03(c), amounts used to Cash Collateralize the
aggregate undrawn amount of Letters of Credit pursuant to clause Fourth above
shall be applied to satisfy drawings under such Letters of Credit as they occur.
If any amount remains on deposit as Cash Collateral after all Letters of Credit
have either been fully drawn or expired, such remaining amount shall be applied
to the other Obligations, if any, in the order set forth above.
ARTICLE X
ADMINISTRATIVE AGENT
10.01 APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT.
(a) Each Lender hereby irrevocably appoints, designates and
authorizes the Administrative Agent to take such action on its behalf under the
provisions of this Agreement and each other Loan Document and to exercise such
powers and perform such duties as are expressly delegated to it by the terms of
this Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere herein or in any other Loan Document, the Administrative
Agent shall not have any duties or responsibilities, except those expressly set
forth herein and in the other Loan Documents, nor shall the Administrative Agent
have or be deemed to have any fiduciary relationship with any Lender or
participant, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against the Administrative Agent. Without limiting
the generality of the foregoing sentence, the use of the term "agent" herein and
in the other Loan Documents with reference to the Administrative Agent is not
intended to connote any fiduciary or other implied (or express) obligations
arising under agency doctrine of any applicable Law. Instead, such term is used
merely as a matter of market custom, and is intended to create or reflect only
an administrative relationship between independent contracting parties.
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(b) The L/C Issuer shall act on behalf of the Lenders with respect
to any Letters of Credit issued by it and the documents associated therewith,
and the L/C Issuer shall have all of the benefits and immunities (i) provided to
the Administrative Agent in this Article X with respect to any acts taken or
omissions suffered by the L/C Issuer in connection with Letters of Credit issued
by it or proposed to be issued by it and the applications and agreements for
letters of credit pertaining to such Letters of Credit as fully as if the term
"Administrative Agent" as used in this Article X and in the definition of
"Agent-Related Person" included the L/C Issuer with respect to such acts or
omissions, and (ii) as additionally provided herein with respect to the L/C
Issuer.
10.02 DELEGATION OF DUTIES.
The Administrative Agent may execute any of its duties under this
Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel and other
consultants or experts concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the negligence or misconduct
of any agent or attorney-in-fact that it selects in the absence of gross
negligence or willful misconduct.
10.03 LIABILITY OF ADMINISTRATIVE AGENT.
No Agent-Related Person shall (a) be liable for any action taken or
omitted to be taken by any of them under or in connection with this Agreement or
any other Loan Document or the transactions contemplated hereby (except for its
own gross negligence or willful misconduct in connection with its duties
expressly set forth herein), or (b) be responsible in any manner to any Lender
or participant for any recital, statement, representation or warranty made by
any Loan Party or any officer thereof, contained herein or in any other Loan
Document, or in any certificate, report, statement or other document referred to
or provided for in, or received by the Administrative Agent under or in
connection with, this Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document, or for any failure of any Loan Party or any other party
to any Loan Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Lender or participant
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party or
any Affiliate thereof.
10.04 RELIANCE BY ADMINISTRATIVE AGENT.
(a) The Administrative Agent shall be entitled to rely, and shall
be fully protected in relying, upon any writing, communication, signature,
resolution, representation, notice, consent, certificate, affidavit, letter,
telegram, facsimile, telex or telephone message, electronic mail message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to any Loan
Party), independent accountants and other experts selected by the Administrative
Agent. The Administrative Agent shall be fully
102
justified in failing or refusing to take any action under any Loan Document
unless it shall first receive such advice or concurrence of the Required Lenders
as it deems appropriate and, if it so requests, it shall first be indemnified to
its satisfaction by the Lenders against any and all liability and expense which
may be incurred by it by reason of taking or continuing to take any such action.
The Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement or any other Loan Document in
accordance with a request or consent of the Required Lenders (or such greater
number of Lenders as may be expressly required hereby in any instance) and such
request and any action taken or failure to act pursuant thereto shall be binding
upon all the Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 5.01, each Lender that has signed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter required thereunder to be consented to or approved by
or acceptable or satisfactory to a Lender unless the Administrative Agent shall
have received notice from such Lender prior to the proposed Closing Date
specifying its objection thereto.
10.05 NOTICE OF DEFAULT.
The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default, except with respect to defaults in the
payment of principal, interest and fees required to be paid to the
Administrative Agent for the account of the Lenders, unless the Administrative
Agent shall have received written notice from a Lender or the Borrower referring
to this Agreement, describing such Default and stating that such notice is a
"notice of default." The Administrative Agent will notify the Lenders of its
receipt of any such notice. The Administrative Agent shall take such action with
respect to such Default as may be directed by the Required Lenders in accordance
with Article IX; provided, however, that unless and until the Administrative
Agent has received any such direction, the Administrative Agent may (but shall
not be obligated to) take such action, or refrain from taking such action, with
respect to such Default as it shall deem advisable or in the best interest of
the Lenders.
10.06 CREDIT DECISION; DISCLOSURE OF INFORMATION BY ADMINISTRATIVE
AGENT.
Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by the Administrative Agent
hereafter taken, including any consent to and acceptance of any assignment or
review of the affairs of any Loan Party or any Affiliate thereof, shall be
deemed to constitute any representation or warranty by any Agent-Related Person
to any Lender as to any matter, including whether Agent-Related Persons have
disclosed material information in their possession. Each Lender represents to
the Administrative Agent that it has, independently and without reliance upon
any Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Loan Parties and their respective Subsidiaries, and all
applicable bank or other regulatory Laws relating to the transactions
contemplated hereby, and made its own decision to enter into this Agreement and
to extend credit to the Borrower hereunder. Each Lender also represents that it
will, independently and without reliance upon any Agent-Related
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Person and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit analysis, appraisals and decisions
in taking or not taking action under this Agreement and the other Loan
Documents, and to make such investigations as it deems necessary to inform
itself as to the business, prospects, operations, property, financial and other
condition and creditworthiness of the Borrower and the other Loan Parties.
Except for notices, reports and other documents expressly required to be
furnished to the Lenders by the Administrative Agent herein, the Administrative
Agent shall not have any duty or responsibility to provide any Lender with any
credit or other information concerning the business, prospects, operations,
property, financial and other condition or creditworthiness of any of the Loan
Parties or any of their respective Affiliates which may come into the possession
of any Agent-Related Person.
10.07 INDEMNIFICATION OF ADMINISTRATIVE AGENT.
Whether or not the transactions contemplated hereby are consummated,
the Lenders shall indemnify upon demand each Agent-Related Person (to the extent
not reimbursed by or on behalf of any Loan Party and without limiting the
obligation of any Loan Party to do so), pro rata, and hold harmless each
Agent-Related Person from and against any and all Indemnified Liabilities
incurred by it; provided, however, that no Lender shall be liable for the
payment to any Agent-Related Person of any portion of such Indemnified
Liabilities to the extent determined in a final, nonappealable judgment by a
court of competent jurisdiction to have resulted from such Agent-Related
Person's own gross negligence or willful misconduct; provided, however, that no
action taken in accordance with the directions of the Required Lenders shall be
deemed to constitute gross negligence or willful misconduct for purposes of this
Section. Without limitation of the foregoing, each Lender shall reimburse the
Administrative Agent upon demand for its ratable share of any costs or
out-of-pocket expenses (including Attorney Costs) incurred by the Administrative
Agent in connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Loan Document, or any document
contemplated by or referred to herein, to the extent that the Administrative
Agent is not reimbursed for such expenses by or on behalf of the Borrower. The
undertaking in this Section shall survive termination of the Aggregate Revolving
Commitments, the payment of all other Obligations and the resignation of the
Administrative Agent.
10.08 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY.
Bank of America and its Affiliates may make loans to, issue letters of
credit for the account of, accept deposits from, acquire equity interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with each of the Loan Parties and their respective Affiliates
as though Bank of America were not the Administrative Agent or the L/C Issuer
hereunder and without notice to or consent of the Lenders. The Lenders
acknowledge that, pursuant to such activities, Bank of America or its Affiliates
may receive information regarding any Loan Party or its Affiliates (including
information that may be subject to confidentiality obligations in favor of such
Loan Party or such Affiliate) and acknowledge that the Administrative Agent
shall be under no obligation to provide such information to them. With
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respect to its Loans, Bank of America shall have the same rights and powers
under this Agreement as any other Lender and may exercise such rights and powers
as though it were not the Administrative Agent or the L/C Issuer, and the terms
"Lender" and "Lenders" include Bank of America in its individual capacity.
10.09 SUCCESSOR ADMINISTRATIVE AGENT.
The Administrative Agent may resign as Administrative Agent upon 30
days' notice to the Lenders; provided that any such resignation shall also
constitute a resignation as L/C Issuer. If the Administrative Agent resigns
under this Agreement, the Required Lenders shall appoint from among the Lenders
a successor administrative agent for the Lenders, which successor administrative
agent shall be consented to by the Borrower at all times other than during the
existence of an Event of Default (which consent of the Borrower shall not be
unreasonably withheld or delayed). If no successor administrative agent is
appointed prior to the effective date of the resignation of the Administrative
Agent, the Administrative Agent may appoint, after consulting with the Lenders
and the Borrower, a successor administrative agent from among the Lenders. Upon
the acceptance of its appointment as successor administrative agent hereunder,
the Person acting as such successor administrative agent shall succeed to all
the rights, powers and duties of the retiring Administrative Agent, L/C Issuer
and the respective terms "Administrative Agent" and "L/C Issuer" shall mean such
successor administrative agent and Letter of Credit issuer, and the retiring
Administrative Agent's appointment, powers and duties as Administrative Agent
shall be terminated and the retiring L/C Issuer's rights, powers and duties as
such shall be terminated, without any other or further act or deed on the part
of such retiring L/C Issuer or any other Lender, other than the obligation of
the successor L/C Issuer to issue letters of credit in substitution for the
Letters of Credit, if any, outstanding at the time of such succession or to make
other arrangements satisfactory to the retiring L/C Issuer to effectively assume
the obligations of the retiring L/C Issuer with respect to such Letters of
Credit. After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this Article X and Sections 11.04 and
11.05 shall inure to its benefit as to any actions taken or omitted to be taken
by it while it was Administrative Agent or L/C Issuer under this Agreement. If
no successor administrative agent has accepted appointment as Administrative
Agent by the date which is 30 days following a retiring Administrative Agent's
notice of resignation, the retiring Administrative Agent's resignation shall
nevertheless thereupon become effective and the Lenders shall perform all of the
duties of the Administrative Agent hereunder until such time, if any, as the
Required Lenders appoint a successor agent as provided for above.
10.10 ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to any Loan Party, the Administrative Agent
(irrespective of whether the principal of any Loan or L/C Obligation shall then
be due and payable as herein expressed or by declaration or otherwise and
irrespective of whether the Administrative Agent shall have made any demand on
the Borrower) shall be entitled and empowered, by intervention in such
proceeding or otherwise
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(a) to file and prove a claim for the whole amount of the
principal and interest owing and unpaid in respect of the Loans, L/C
Obligations and all other Obligations that is owing and unpaid and to
file such other documents as may be necessary or advisable in order to
have the claims of the Lenders and the Administrative Agent (including
any claim for the reasonable compensation, expenses, disbursements and
advances of the Lenders and the Administrative Agent and their
respective agents and counsel and all other amounts due the Lenders and
the Administrative Agent under Sections 2.03(i) and (j), 2.08 and
11.04) allowed in such judicial proceeding; and
(b) to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to the Administrative Agent and, in the event
that the Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to the Administrative Agent any amount due for
the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Sections 2.08 and 11.04.
Nothing contained herein shall be deemed to authorize the
Administrative Agent to authorize or consent to or accept or adopt on behalf of
any Lender any plan of reorganization, arrangement, adjustment or composition
affecting the Obligations or the rights of any Lender or to authorize the
Administrative Agent to vote in respect of the claim of any Lender in any such
proceeding.
10.11 COLLATERAL AND GUARANTY MATTERS.
The Lenders irrevocably authorize the Administrative Agent, at its
option and in its discretion,
(a) to release any Lien on any property granted to or
held by the Administrative Agent under any Loan Document (i) upon
termination of the Aggregate Revolving Commitments and payment in full
of all Obligations (other than contingent indemnification obligations)
and the expiration or termination of all Letters of Credit, (ii) that
is transferred or to be transferred as part of or in connection with
any Disposition or other transaction permitted hereunder or under any
other Loan Document, or (iii) subject to Section 11.01, if approved,
authorized or ratified in writing by the Required Lenders;
(b) to subordinate any Lien on any Property granted to or
held by the Administrative Agent under any Loan Document to the holder
of any Lien on such Property that is permitted by Section 8.01(i); and
(c) to release any Guarantor from its obligations under
the Guaranty if such Person ceases to be a Subsidiary as a result of a
transaction permitted hereunder.
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Upon request by the Administrative Agent at any time, the Required
Lenders will confirm in writing the Administrative Agent's authority to release
or subordinate its interest in particular types or items of Property, or to
release any Guarantor from its obligations under the Guaranty pursuant to this
Section 10.11.
10.12 OTHER AGENTS; ARRANGERS AND MANAGERS.
None of the Lenders or other Persons identified on the facing page or
signature pages of this Agreement as a "syndication agent," "documentation
agent," "co-agent," "book manager," "lead manager," "arranger," "lead arranger,"
"co-arranger" or similar title shall have any right, power, obligation,
liability, responsibility or duty under this Agreement other than, in the case
of such Lenders, those applicable to all Lenders as such. Without limiting the
foregoing, none of the Lenders or other Persons so identified shall have or be
deemed to have any fiduciary relationship with any Lender. Each Lender
acknowledges that it has not relied, and will not rely, on any of the Lenders or
other Persons so identified in deciding to enter into this Agreement or in
taking or not taking action hereunder.
ARTICLE XI
MISCELLANEOUS
11.01 AMENDMENTS, ETC.
No amendment or waiver of any provision of this Agreement or any other
Loan Document, and no consent to any departure by the Borrower or any other Loan
Party therefrom, shall be effective unless in writing signed by the Required
Lenders and the Borrower or the applicable Loan Party, as the case may be, and
acknowledged by the Administrative Agent, and each such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given; provided, however, that no such amendment, waiver or consent shall:
(a) extend or increase the Commitment of any Lender (or
reinstate any Commitment terminated pursuant to Section 9.02) without
the written consent of such Lender (it being understood and agreed that
a waiver of any condition precedent set forth in Section 5.02 or of any
Default or Event of Default or mandatory reduction in the Commitments
shall not constitute a change in the terms of any Commitment of any
Lender);
(b) postpone any date fixed by this Agreement or any
other Loan Document for any payment (excluding mandatory prepayments)
of principal, interest, fees or other amounts due to the Lenders (or
any of them) hereunder or under any other Loan Document without the
written consent of each Lender directly affected thereby;
(c) reduce the principal of, or the rate of interest
specified herein on, any Loan or L/C Borrowing, or any fees or other
amounts payable hereunder or under any other Loan Document without the
written consent of each Lender directly affected thereby; provided,
however, that only the consent of the Required Lenders shall be
necessary to
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amend the definition of "Default Rate" or to waive any obligation of
the Borrower to pay interest or Letter of Credit Fees at the Default
Rate;
(d) change Section 2.12 or Section 9.03 in a manner that
would alter the pro rata sharing of payments required thereby without
the written consent of each Lender;
(e) change any provision of this Section or the
definition of "Required Lenders" or any other provision hereof
specifying the number or percentage of Lenders required to amend, waive
or otherwise modify any rights hereunder or make any determination or
grant any consent hereunder, without the written consent of each
Lender;
(f) (i) except as the result of or in connection with a
Disposition not prohibited by Section 8.05, release all or
substantially all of the Collateral and (ii) except as otherwise
provided in Section 10.11, release all or substantially all of the
Guarantors, in each case without the written consent of each Lender;
(g) except as the result of or in connection with a
dissolution, merger or disposition of a Loan Party not prohibited by
Section 8.04 or Section 8.05, release the Borrower or substantially all
of the other Loan Parties from its or their obligations under the Loan
Documents without the written consent of each Lender;
(h) without the consent of Lenders (other than Defaulting
Lenders) holding in the aggregate at least a majority of the Revolving
Commitments (or if the Revolving Commitments have been terminated, the
outstanding Revolving Loans (and participations in any L/C
Obligations)), waive any Default or Event of Default for purposes of
Section 5.02(b);
(i) without the consent of Lenders (other than Defaulting
Lenders) holding in the aggregate at least a majority of the
outstanding Term Loan (and participations therein), (i) amend, change,
waive, discharge or terminate Section 9.03 so as to alter the manner of
application of any payment in respect of the Obligations or proceeds of
Collateral and (ii) amend, change, waive, discharge or terminate
Section 2.04(b)(v) so as to alter the manner of application of proceeds
of any mandatory prepayment required by Section 2.04(b)(ii), (iii), or
(iv) hereof;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Lenders required above,
affect the rights or duties of the L/C Issuer as such under this Agreement or
any Letter of Credit Application relating to any Letter of Credit issued or to
be issued by it; (ii) no amendment, waiver or consent shall, unless in writing
and signed by the Administrative Agent in addition to the Lenders required
above, affect the rights or duties of the Administrative Agent as such under
this Agreement or any other Loan Document; (iii) the Fee Letter may be amended,
or rights or privileges thereunder waived, in a writing executed only by the
parties thereto.
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Notwithstanding anything to the contrary herein, no Defaulting Lender
shall have any right to approve or disapprove any amendment, waiver or consent
hereunder, except that the Commitment of such Lender may not be increased or
extended without the consent of such Lender.
Notwithstanding the fact that the consent of all the Lenders is
required in certain circumstances as set forth above, (x) each Lender is
entitled to vote as such Lender sees fit on any bankruptcy reorganization plan
that affects the Loans, and each Lender acknowledges that the provisions of
Section 1126(c) of the Bankruptcy Code supersedes the unanimous consent
provisions set forth herein and (y) the Required Lenders shall determine whether
or not to allow a Loan Party to use cash collateral in the context of a
bankruptcy or insolvency proceeding and such determination shall be binding on
all of the Lenders.
11.02 NOTICES AND OTHER COMMUNICATIONS; FACSIMILE COPIES.
(a) General. Unless otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including by facsimile transmission). All such written notices shall be mailed
certified or registered mail, faxed or delivered to the applicable address,
facsimile number or (subject to subsection (c) below) electronic mail address,
and all notices and other communications expressly permitted hereunder to be
given by telephone shall be made to the applicable telephone number, as follows:
(i) if to the Borrower, the Administrative Agent or the
L/C Issuer, to the address, facsimile number, electronic mail address
or telephone number specified for such Person on Schedule 11.02 or to
such other address, facsimile number, electronic mail address or
telephone number as shall be designated by such party in a notice to
the other parties; and
(ii) if to any other Lender, to the address, facsimile
number, electronic mail address or telephone number specified in its
Administrative Questionnaire or to such other address, facsimile
number, electronic mail address or telephone number as shall be
designated by such party in a notice to the Borrower, the
Administrative Agent and the L/C Issuer.
Notices sent by hand or overnight courier service, or mailed by certified or
registered mail, shall be deemed to have been given when received; notices sent
by facsimile shall be deemed to have been given when sent (except that, if not
given during normal business hours for the recipient, shall be deemed to have
been given at the opening of business on the next business day for the
recipient). Notices delivered through electronic communications to the extent
provided in subsection (b) below, shall be effective as provided in such
subsection (b).
(b) Electronic Communications. Notices and other communications to
the Lenders hereunder may be delivered or furnished by electronic communication
(including e-mail and Internet or intranet websites) pursuant to procedures
approved by the Administrative Agent, provided that the foregoing shall not
apply to notices to any Lender pursuant to Article II if such Lender has
notified the Administrative Agent that it is incapable of receiving notices
under such
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Article by electronic communication. The Administrative Agent or the Borrower
may, in its discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it,
provided that approval of such procedures may be limited to particular notices
or communications.
(c) Effectiveness of Facsimile Documents and Signatures. Loan
Documents may be transmitted and/or signed by facsimile. The effectiveness of
any such documents and signatures shall, subject to applicable Law, have the
same force and effect as manually-signed originals and shall be binding on all
Loan Parties, the Administrative Agent and the Lenders. The Administrative Agent
may also require that any such documents and signatures be confirmed by a
manually-signed original thereof; provided, however, that the failure to request
or deliver the same shall not limit the effectiveness of any facsimile document
or signature.
(d) Reliance by Administrative Agent and Lenders. The
Administrative Agent and the Lenders shall be entitled to rely and act upon any
notices (including telephonic Loan Notices) purportedly given by or on behalf of
the Borrower even if (i) such notices were not made in a manner specified
herein, were incomplete or were not preceded or followed by any other form of
notice specified herein, or (ii) the terms thereof, as understood by the
recipient, varied from any confirmation thereof. The Borrower shall indemnify
each Agent-Related Person and each Lender from all losses, costs, expenses and
liabilities resulting from the reliance by such Person on each notice
purportedly given by or on behalf of the Borrower. All telephonic notices to and
other communications with the Administrative Agent may be recorded by the
Administrative Agent, and each of the parties hereto hereby consents to such
recording.
11.03 NO WAIVER; CUMULATIVE REMEDIES.
No failure by any Lender or the Administrative Agent to exercise, and
no delay by any such Person in exercising, any right, remedy, power or privilege
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein provided are
cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law.
11.04 ATTORNEY COSTS, EXPENSES AND TAXES.
The Loan Parties jointly and severally agree (a) to pay or reimburse
the Administrative Agent for all reasonable costs and expenses incurred in
connection with the development, preparation, negotiation and execution of this
Agreement and the other Loan Documents and any amendment, waiver, consent or
other modification of the provisions hereof and thereof (whether or not the
transactions contemplated hereby or thereby are consummated), and the
consummation and administration of the transactions contemplated hereby and
thereby, including all Attorney Costs, and (b) to pay or reimburse the
Administrative Agent and each Lender for all costs and expenses incurred in
connection with the enforcement, attempted enforcement, or preservation of any
rights or remedies under this Agreement or the other Loan Documents (including
all such costs and expenses incurred during any "workout" or restructuring in
respect of the Obligations and during any legal proceeding, including any
proceeding under any Debtor Relief Law),
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including all Attorney Costs. The foregoing costs and expenses shall include all
search, filing, recording, title insurance and appraisal charges and fees and
taxes related thereto, and other out-of-pocket expenses incurred by the
Administrative Agent and the cost of independent public accountants and other
outside experts retained by the Administrative Agent or any Lender. All amounts
due under this Section 11.04 shall be payable within ten Business Days after
demand therefor. The agreements in this Section shall survive the termination of
the Aggregate Revolving Commitments and repayment of all other Obligations.
11.05 INDEMNIFICATION BY THE BORROWER.
Whether or not the transactions contemplated hereby are consummated,
the Loan Parties jointly and severally shall indemnify and hold harmless each
Agent-Related Person, each Lender and their respective Affiliates, directors,
officers, employees, counsel, agents and attorneys-in-fact (collectively the
"Indemnitees") from and against any and all liabilities, obligations, losses,
damages, penalties, claims, demands, actions, judgments, suits, costs, expenses
and disbursements (including Attorney Costs) of any kind or nature whatsoever
which may at any time be imposed on, incurred by or asserted against any such
Indemnitee in any way relating to or arising out of or in connection with (a)
the execution, delivery, enforcement, performance or administration of any Loan
Document or any other agreement, letter or instrument delivered in connection
with the transactions contemplated thereby or the consummation of the
transactions contemplated thereby, (b) any Commitment, Loan or Letter of Credit
or the use or proposed use of the proceeds therefrom (including any refusal by
the L/C Issuer to honor a demand for payment under a Letter of Credit if the
documents presented in connection with such demand do not strictly comply with
the terms of such Letter of Credit), (c) any actual or alleged presence or
release of Hazardous Materials on or from any property currently or formerly
owned or operated by the Borrower, any Subsidiary or any other Loan Party, or
any Environmental Liability related in any way to the Borrower, any Subsidiary
or any other Loan Party, or (d) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory (including any investigation of, preparation
for, or defense of any pending or threatened claim, investigation, litigation or
proceeding) and regardless of whether any Indemnitee is a party thereto (all the
foregoing, collectively, the "Indemnified Liabilities"), in all cases, whether
or not caused by or arising, in whole or in part, out of the negligence of the
Indemnitee; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such liabilities, obligations, losses, damages,
penalties, claims, demands, actions, judgments, suits, costs, expenses or
disbursements are determined by a court of competent jurisdiction by final and
nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Indemnitee. No Indemnitee shall be liable for any damages
arising from the use by others of any information or other materials obtained
through IntraLinks or other similar information transmission systems in
connection with this Agreement, nor shall any Indemnitee have any liability for
any indirect or consequential damages relating to this Agreement or any other
Loan Document or arising out of its activities in connection herewith or
therewith (whether before or after the Closing Date). All amounts due under this
Section 11.05 shall be payable within ten Business Days after demand therefor.
The agreements in this Section shall survive the resignation of the
Administrative Agent, the replacement of any Lender, the termination of the
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Aggregate Revolving Commitments and the repayment, satisfaction or discharge of
all the other Obligations.
11.06 PAYMENTS SET ASIDE.
To the extent that any payment by or on behalf of any Loan Party is
made to the Administrative Agent or any Lender, or the Administrative Agent or
any Lender exercises its right of set-off, and such payment or the proceeds of
such set-off or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by the Administrative Agent or such Lender in its
discretion) to be repaid to a trustee, receiver or any other party, in
connection with any proceeding under any Debtor Relief Law or otherwise, then
(a) to the extent of such recovery, the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and effect
as if such payment had not been made or such set-off had not occurred, and (b)
each Lender severally agrees to pay to the Administrative Agent upon demand its
applicable share of any amount so recovered from or repaid by the Administrative
Agent, plus interest thereon from the date of such demand to the date such
payment is made at a rate per annum equal to the Federal Funds Rate from time to
time in effect.
11.07 SUCCESSORS AND ASSIGNS.
(a) The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby, except that the Borrower may not assign or otherwise
transfer any of its rights or obligations hereunder without the prior written
consent of each Lender and no Lender may assign or otherwise transfer any of its
rights or obligations hereunder except (i) to an Eligible Assignee in accordance
with the provisions of subsection (b) of this Section, (ii) by way of
participation in accordance with the provisions of subsection (d) of this
Section, or (iii) by way of pledge or assignment of a security interest subject
to the restrictions of subsection (f) of this Section (and any other attempted
assignment or transfer by any party hereto shall be null and void). Nothing in
this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and assigns
permitted hereby, Participants to the extent provided in subsection (d) of this
Section and, to the extent expressly contemplated hereby, the Indemnitees) any
legal or equitable right, remedy or claim under or by reason of this Agreement.
(b) Any Lender may at any time assign to one or more Eligible
Assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans (including for
purposes of this subsection (b), participations in L/C Obligations) at the time
owing to it); provided that (i) except in the case of an assignment of the
entire remaining amount of the assigning Lender's Commitment and the Loans at
the time owing to it or in the case of an assignment to a Lender or an Affiliate
of a Lender or an Approved Fund (as defined in subsection (g) of this Section)
with respect to a Lender, the aggregate amount of the Commitment (which for this
purpose includes Loans outstanding thereunder) subject to each such assignment,
determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent or, if "Trade Date" is
specified in the Assignment and Assumption, as of the Trade Date, shall not be
less than (x) $5,000,000 with
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respect to the assignment of a Revolving Commitment and (y) $1,000,000 with
respect to the assignment of the Term Loan, unless, in each case, each of the
Administrative Agent and, so long as no Event of Default has occurred and is
continuing, the Borrower otherwise consents (each such consent not to be
unreasonably withheld or delayed); (ii) each partial assignment shall be made as
an assignment of a proportionate part of all the assigning Lender's rights and
obligations under this Agreement with respect to its Pro Rata Share of (x) the
Revolving Loans and/or the Revolving Commitment or (y) the Term Loan and/or the
Term Loan Commitment, as applicable, assigned; (iii) any assignment of a
Revolving Commitment must be approved by the Administrative Agent and the L/C
Issuer (each such consent not to be unreasonably withheld or delayed) unless the
Person that is the proposed assignee is itself a Lender (whether or not the
proposed assignee would otherwise qualify as an Eligible Assignee); and (iv) the
parties to each assignment shall execute and deliver to the Administrative Agent
an Assignment and Assumption, together with a processing and recordation fee of
$3,500 to be paid by either the assignee or assignor Lender. Subject to
acceptance and recording thereof by the Administrative Agent pursuant to
subsection (c) of this Section, from and after the effective date specified in
each Assignment and Assumption, the Eligible Assignee thereunder shall be a
party to this Agreement and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 3.01, 3.04, 3.05, 11.04 and 11.05
with respect to facts and circumstances occurring prior to the effective date of
such assignment). Upon request, the Borrower (at its expense) shall execute and
deliver a Note to the assignee Lender; provided that any Note of the assigning
Lender is correspondingly modified or replaced to the extent applicable. Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this subsection shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with subsection (d) of this Section.
(c) The Administrative Agent, acting solely for this purpose as an
agent of the Borrower, shall maintain at the Administrative Agent's Office a
copy of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amounts of the Loans and L/C Obligations owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive absent manifest error, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Borrower, at any reasonable
time and from time to time upon reasonable prior notice. In addition, at any
time that a request for a consent for a material or other substantive change to
the Loan Documents is pending, any Lender wishing to consult with other Lenders
in connection therewith may request and receive from the Administrative Agent a
copy of the Register.
(d) Any Lender may at any time, without the consent of, or notice
to, the Borrower or the Administrative Agent, sell participations to any Person
(other than a natural person or the
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Borrower or any of the Borrower's Affiliates or Subsidiaries) (each, a
"Participant") in all or a portion of such Lender's rights and/or obligations
under this Agreement (including all or a portion of its Commitment and/or the
Loans (including such Lender's participations in L/C Obligations) owing to it);
provided that (i) such Lender's obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (iii) the Borrower, the
Administrative Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, waiver or other modification
described in the first proviso to Section 11.01 that directly affects such
Participant. Subject to subsection (e) of this Section, the Borrower agrees that
each Participant shall be entitled to the benefits of Sections 3.01, 3.04 and
3.05 to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to subsection (b) of this Section. To the extent permitted
by law, each Participant also shall be entitled to the benefits of Section 11.09
as though it were a Lender, provided such Participant agrees to be subject to
Section 2.12 as though it were a Lender.
(e) A Participant shall not be entitled to receive any greater
payment under Section 3.01 or 3.04 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the
Borrower's prior written consent. A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 3.01 unless
the Borrower is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Borrower, to comply with Section
11.15 as though it were a Lender.
(f) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement (including
under its Note, if any) to secure obligations of such Lender, including any
pledge or assignment to secure obligations to a Federal Reserve Bank; provided
that no such pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.
(g) As used herein, the following terms have the following
meanings:
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a
Lender; (c) an Approved Fund; and (d) any other Person (other than a
natural person) approved by (i) the Administrative Agent and the L/C
Issuer, and (ii) unless an Event of Default has occurred and is
continuing, the Borrower (each such approval not to be unreasonably
withheld or delayed); provided that notwithstanding the foregoing,
"Eligible Assignee" shall not include the Borrower or any of the
Borrower's Affiliates or Subsidiaries.
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"Fund" means any Person (other than a natural person) that is
(or will be) engaged in making, purchasing, holding or otherwise
investing in commercial loans and similar extensions of credit in the
ordinary course of its business.
"Approved Fund" means any Fund that is administered or managed
by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender.
(h) Notwithstanding anything to the contrary contained herein, if
at any time Bank of America assigns all of its Commitment and Loans pursuant to
subsection (b) above, Bank of America may, upon 30 days' notice to the Borrower
and the Lenders, resign as L/C Issuer. In the event of any such resignation as
L/C Issuer, the Borrower shall be entitled to appoint from among the Lenders a
successor L/C Issuer hereunder; provided, however, that no failure by the
Borrower to appoint any such successor shall affect the resignation of Bank of
America as L/C Issuer. If Bank of America resigns as L/C Issuer, it shall retain
all the rights and obligations of the L/C Issuer hereunder with respect to all
Letters of Credit outstanding as of the effective date of its resignation as L/C
Issuer and all L/C Obligations with respect thereto (including the right to
require the Lenders to make Base Rate Loans or fund risk participations in
Unreimbursed Amounts pursuant to Section 2.03(c)).
11.08 CONFIDENTIALITY.
Each of the Administrative Agent and the Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its Affiliates and to its Affiliates' respective
partners, directors, officers, employees, agents, advisors and representatives
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential); (b) to the extent requested by any regulatory
authority purporting to have jurisdiction over it; (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process; (d)
to any other party to this Agreement; (e) in connection with the exercise of any
remedies hereunder or any suit, action or proceeding relating to this Agreement
or the enforcement of rights hereunder; (f) subject to an agreement containing
provisions substantially the same as those of this Section, to (i) any Eligible
Assignee of or Participant in, or any prospective Eligible Assignee of or
Participant in, any of its rights or obligations under this Agreement or (ii)
any direct or indirect contractual counterparty or prospective counterparty (or
such contractual counterparty's or prospective counterparty's professional
advisor) to any credit derivative transaction relating to obligations of the
Loan Parties; (g) with the consent of the Borrower; (h) to the extent such
Information (i) becomes publicly available other than as a result of a breach of
this Section or (ii) becomes available to the Administrative Agent or any Lender
on a nonconfidential basis from a source other than the a Consolidated Party; or
(i) to the National Association of Insurance Commissioners or any other similar
organization. In addition, the Administrative Agent and the Lenders may disclose
the existence of this Agreement and information about this Agreement to market
data collectors, similar service providers to the lending industry, and service
providers to the Administrative Agent and the Lenders in connection with the
administration and management of this Agreement, the other Loan Documents, the
Commitments, and the Credit Extensions. For the
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purposes of this Section, "Information" means all information received from the
Borrower or any of its Subsidiaries relating to the Borrower or any Subsidiary
or any of their respective businesses, other than any such information that is
available to the Administrative Agent or any Lender on a nonconfidential basis
prior to disclosure by the Borrower or any Subsidiary; provided that, in the
case of information received from the Borrower or any Subsidiary after the date
hereof, such information is clearly identified in writing at the time of
delivery as confidential. Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of
care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information.
11.09 SET-OFF.
In addition to any rights and remedies of the Lenders provided by law,
upon the occurrence and during the continuance of any Event of Default after
obtaining the prior written consent of the Administrative Agent, each Lender is
authorized at any time and from time to time, without prior notice to the
Borrower or any other Loan Party, any such notice being waived by the Borrower
(on its own behalf and on behalf of each Loan Party) to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held by, and other
indebtedness at any time owing by, such Lender to or for the credit or the
account of the respective Loan Parties, and each Loan Party hereby grants a
security interest in all such deposits and indebtedness to the Administrative
Agent for the benefit of the Administrative Agent and the Lenders, against any
and all Obligations owing to such Lender hereunder or under any other Loan
Document, now or hereafter existing, irrespective of whether or not the
Administrative Agent or such Lender shall have made demand under this Agreement
or any other Loan Document and although such Obligations may be contingent or
unmatured or denominated in a currency different from that of the applicable
deposit or indebtedness. Each Lender agrees promptly to notify the Borrower and
the Administrative Agent after any such set-off and application made by such
Lender; provided, however, that the failure to give such notice shall not affect
the validity of such set-off and application.
11.10 INTEREST RATE LIMITATION.
Anything in this Agreement, the Notes or any of the other Loan
Documents to the contrary notwithstanding, in no event whatsoever, whether by
reason of advancement of proceeds of the Loans, acceleration of the maturity of
the unpaid balance of the Obligations or otherwise, shall the interest and loan
charges agreed to be paid to the L/C Issuer or any Lender for the use of the
money advanced or to be advanced hereunder exceed the maximum amounts
collectible under applicable Laws in effect from time to time. It is understood
and agreed by the parties that, if for any reason whatsoever the interest or
loan charges paid or contracted to be paid in respect of any of the Obligations
shall exceed the maximum amounts collectible under applicable Laws in effect
from time to time, then ipso facto, the obligation to pay such interest and/or
loan charges shall be reduced to the maximum amounts collectible under
applicable Laws in effect from time to time, and any amounts collected by the
L/C Issuer or any Lender that exceed such maximum amounts shall be applied to
the reduction of the principal balance of the
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Obligations and/or refunded to the Loan Parties so that at no time shall the
interest or loan charges paid or payable in respect of the Obligations exceed
the maximum amounts permitted from time to time by applicable Laws.
11.11 COUNTERPARTS.
This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
11.12 INTEGRATION.
This Agreement, together with the other Loan Documents, comprises the
complete and integrated agreement of the parties on the subject matter hereof
and thereof and supersedes all prior agreements, written or oral, on such
subject matter. In the event of any conflict between the provisions of this
Agreement and those of any other Loan Document, the provisions of this Agreement
shall control; provided that the inclusion of supplemental rights or remedies in
favor of the Administrative Agent or the Lenders in any other Loan Document
shall not be deemed a conflict with this Agreement. Each Loan Document was
drafted with the joint participation of the respective parties thereto and shall
be construed neither against nor in favor of any party, but rather in accordance
with the fair meaning thereof.
11.13 SURVIVAL OF REPRESENTATIONS AND WARRANTIES.
All representations and warranties made hereunder and in any other Loan
Document or other document delivered pursuant hereto or thereto or in connection
herewith or therewith shall survive the execution and delivery hereof and
thereof. Such representations and warranties have been or will be relied upon by
the Administrative Agent and each Lender, regardless of any investigation made
by the Administrative Agent or any Lender or on their behalf and notwithstanding
that the Administrative Agent or any Lender may have had notice or knowledge of
any Default at the time of any Credit Extension, and shall continue in full
force and effect as long as any Loan or any other Obligation hereunder shall
remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.
11.14 SEVERABILITY.
If any provision of this Agreement or the other Loan Documents is held
to be illegal, invalid or unenforceable, (a) the legality, validity and
enforceability of the remaining provisions of this Agreement and the other Loan
Documents shall not be affected or impaired thereby and (b) the parties shall
endeavor in good faith negotiations to replace the illegal, invalid or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the illegal, invalid or unenforceable
provisions. The invalidity of a provision in a particular jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
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11.15 TAX FORMS.
(a) (i) Each Lender that is not a "United States person"
within the meaning of Section 7701(a)(30) of the Code (a "Foreign
Lender") shall deliver to the Administrative Agent, prior to receipt of
any payment subject to withholding under the Code (or upon accepting an
assignment of an interest herein), two duly signed completed copies of
either IRS Form W-8BEN or any successor thereto (relating to such
Foreign Lender and entitling it to an exemption from, or reduction of,
withholding tax on all payments to be made to such Foreign Lender by
the Borrower pursuant to this Agreement) or IRS Form W-8ECI or any
successor thereto (relating to all payments to be made to such Foreign
Lender by the Borrower pursuant to this Agreement) or such other
evidence satisfactory to the Borrower and the Administrative Agent that
such Foreign Lender is entitled to an exemption from, or reduction of,
U.S. withholding tax, including any exemption pursuant to Section
881(c) of the Code. Thereafter and from time to time, each such Foreign
Lender shall (A) promptly submit to the Administrative Agent such
additional duly completed and signed copies of one of such forms (or
such successor forms as shall be adopted from time to time by the
relevant United States taxing authorities) as may then be available
under then current United States laws and regulations to avoid, or such
evidence as is satisfactory to the Borrower and the Administrative
Agent of any available exemption from or reduction of, United States
withholding taxes in respect of all payments to be made to such Foreign
Lender by the Borrower pursuant to this Agreement, (B) promptly notify
the Administrative Agent of any change in circumstances which would
modify or render invalid any claimed exemption or reduction, and (C)
take such steps as shall not be materially disadvantageous to it, in
the reasonable judgment of such Lender, and as may be reasonably
necessary (including the re-designation of its Lending Office) to avoid
any requirement of applicable Laws that the Borrower make any deduction
or withholding for taxes from amounts payable to such Foreign Lender.
(ii) Each Foreign Lender, to the extent it does not act or
ceases to act for its own account with respect to any portion of any
sums paid or payable to such Lender under any of the Loan Documents
(for example, in the case of a typical participation by such Lender),
shall deliver to the Administrative Agent on the date when such Foreign
Lender ceases to act for its own account with respect to any portion of
any such sums paid or payable, and at such other times as may be
necessary in the determination of the Administrative Agent (in the
reasonable exercise of its discretion), (A) two duly signed completed
copies of the forms or statements required to be provided by such
Lender as set forth above, to establish the portion of any such sums
paid or payable with respect to which such Lender acts for its own
account that is not subject to U.S. withholding tax, and (B) two duly
signed completed copies of IRS Form W-8IMY (or any successor thereto),
together with any information such Lender chooses to transmit with such
form, and any other certificate or statement of exemption required
under the Code, to establish that such Lender is not acting for its own
account with respect to a portion of any such sums payable to such
Lender.
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(iii) The Borrower shall not be relieved of its obligation
to pay any additional amount to any Foreign Lender under Section 3.01
(A) with respect to any Taxes required to be deducted or withheld on
the basis of the information, certificates or statements of exemption
such Lender transmits with an IRS Form W-8IMY pursuant to this Section
11.15(a) or (B) if such Lender shall have failed to satisfy the
foregoing provisions of this Section 11.15(a); provided that if such
Lender shall have satisfied the requirement of this Section 11.15(a) on
the date such Lender became a Lender or ceased to act for its own
account with respect to any payment under any of the Loan Documents,
nothing in this Section 11.15(a) shall relieve the Borrower of its
obligation to pay any amounts pursuant to Section 3.01 in the event
that, as a result of any change in any applicable law, treaty or
governmental rule, regulation or order, or any change in the
interpretation, administration or application thereof, such Lender is
no longer properly entitled to deliver forms, certificates or other
evidence at a subsequent date establishing the fact that such Lender or
other Person for the account of which such Lender receives any sums
payable under any of the Loan Documents is not subject to withholding
or is subject to withholding at a reduced rate; and provided further
that if the L/C Issuer shall issue, amend or extend any Letter of
Credit from a branch or other office in any jurisdiction at the request
of (or with the consent of ) the Borrower and the L/C Issuer shall not
be lawfully able or entitled to satisfy the requirements of this
Section 11.15(a) at the time of issuance, amendment or extension of any
Letter of Credit by reason of the selection of such branch or office in
such jurisdiction, nothing in this Section 11.15(a) shall relieve the
Borrower of its obligation to pay any amounts pursuant to Section 3.01
owing to the L/C Issuer.
(iv) Notwithstanding Section 3.01 or any other provision
of this Agreement to the contrary, neither the Borrower nor any other
Loan Party shall be required to pay any additional amount to any
Foreign Lender under Section 3.01 (A) with respect to any Taxes
required to be deducted or withheld on the basis of the information,
certificates or statements of exemption such Lender transmits with an
IRS Form W-8IMY pursuant to this Section 11.15(a) or (B) if such Lender
shall have failed to satisfy the foregoing provisions of this Section
11.15(a); provided that if such Lender shall have satisfied the
requirement of this Section 11.15(a) on the date such Lender became a
Lender or ceased to act for its own account with respect to any payment
under any of the Loan Documents, nothing in this Section 11.15(a) shall
relieve the Borrower of its obligation to pay any amounts pursuant to
Section 3.01 in the event that, as a result of any change in any
applicable law, treaty or governmental rule, regulation or order, or
any change in the interpretation, administration or application
thereof, such Lender is no longer properly entitled to deliver forms,
certificates or other evidence at a subsequent date establishing the
fact that such Lender or other Person for the account of which such
Lender receives any sums payable under any of the Loan Documents is not
subject to withholding or is subject to withholding at a reduced rate.
(v) The Administrative Agent may, without reduction,
withhold any Taxes required to be deducted and withheld from any
payment under any of the Loan Documents with respect to which the
Borrower is not required to pay additional amounts under this Section
11.15(a).
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(b) Upon the request of the Administrative Agent, each Lender that
is a "United States person" within the meaning of Section 7701(a)(30) of the
Code shall deliver to the Administrative Agent two duly signed completed copies
of IRS Form W-9. If such Lender fails to deliver such forms, then the
Administrative Agent may withhold from any interest payment to such Lender an
amount equivalent to the applicable back-up withholding tax imposed by the Code,
without reduction.
(c) If any Governmental Authority asserts that the Administrative
Agent did not properly withhold or backup withhold, as the case may be, any tax
or other amount from payments made to or for the account of any Lender, such
Lender shall indemnify the Administrative Agent and the Loan Parties therefor,
including all penalties and interest, any taxes imposed by any jurisdiction on
the amounts payable to the Administrative Agent under this Section, and costs
and expenses (including Attorney Costs) of the Administrative Agent and the Loan
Parties. The obligation of the Lenders under this Section shall survive the
termination of the Aggregate Revolving Commitments, repayment of all other
Obligations hereunder and the resignation of the Administrative Agent.
11.16 REPLACEMENT OF LENDERS.
Under any circumstances set forth herein providing that the Borrower
shall have the right to replace a Lender as a party to this Agreement, the
Borrower may, upon notice to such Lender and the Administrative Agent, replace
such Lender by causing such Lender to assign its Commitment and outstanding
Loans (with the assignment fee to be paid by the Borrower in such instance)
pursuant to Section 11.07(b) to one or more other Lenders or Eligible Assignees
procured by the Borrower; provided, however, that if the Borrower elects to
exercise such right with respect to any Lender pursuant to Section 3.06(b), it
shall be obligated to replace all Lenders that have made the same request for
compensation pursuant to Section 3.01 or 3.04. Upon the making of any such
assignment, the Borrower shall (x) pay in full all principal, interest, fees and
other amounts owing to such Lender through the date of replacement (including
any amounts payable pursuant to Section 3.05), and (y) provide appropriate
assurances and indemnities (which may include letters of credit) to the L/C
Issuer as it may reasonably require with respect to any continuing obligation to
fund participation interests in any L/C Obligations.
11.17 GOVERNING LAW.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF TENNESSEE APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE ADMINISTRATIVE
AGENT AND EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF
TENNESSEE SITTING IN DAVIDSON COUNTY OR OF THE UNITED STATES FOR THE MIDDLE
DISTRICT OF TENNESSEE, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF
THE LOAN PARTIES, THE ADMINISTRATIVE AGENT AND EACH LENDER CONSENTS, FOR ITSELF
AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE
COURTS. EACH OF THE LOAN PARTIES,
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THE ADMINISTRATIVE AGENT AND EACH LENDER IRREVOCABLY WAIVES ANY OBJECTION,
INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM
NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION
OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT OR OTHER
DOCUMENT RELATED THERETO. EACH OF THE LOAN PARTIES, THE ADMINISTRATIVE AGENT AND
EACH LENDER WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS,
WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.
11.18 WAIVER OF RIGHT TO TRIAL BY JURY.
EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL
BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN
DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS
OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE
TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY
HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO
THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH
ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE
WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
11.19 USA PATRIOT ACT NOTICE.
Each Lender and the Administrative Agent (for itself and not on behalf
of any Lender) hereby notifies the Borrower that pursuant to the requirements of
the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the "Act"), it is required to obtain, verify and record information that
identifies the Borrower, which information includes the name and address of the
Borrower and other information that will allow such Lender or the Administrative
Agent, as applicable, to identify the Borrower in accordance with the Act.
11.20 DESIGNATION AS DESIGNATED SENIOR INDEBTEDNESS.
All Obligations shall be "Designated Senior Indebtedness" for purposes
of and as defined in the Convertible Note Indenture.
11.21 JUDGMENT CURRENCY.
If, for the purposes of obtaining judgment in any court, it is
necessary to convert a sum due hereunder or any other Loan Document in one
currency into another currency, the rate of
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exchange used shall be that at which in accordance with normal banking
procedures the Administrative Agent could purchase the first currency with such
other currency on the Business Day preceding that on which final judgment is
given. The obligation of the Borrower in respect of any such sum due from it to
the Administrative Agent or the Lenders hereunder or under the other Loan
Documents shall, notwithstanding any judgment in a currency (the "Judgment
Currency") other than that in which such sum is denominated in accordance with
the applicable provisions of this Agreement (the "Agreement Currency"), be
discharged only to the extent that on the Business Day following receipt by the
Administrative Agent of any sum adjudged to be so due in the Judgment Currency,
the Administrative Agent may in accordance with normal banking procedures
purchase the Agreement Currency with the Judgment Currency. If the amount of the
Agreement Currency so purchased is less than the sum originally due to the
Administrative Agent from the Borrower in the Agreement Currency, the Borrower
agrees, as a separate obligation and notwithstanding any such judgment, to
indemnify the Administrative Agent or the Person to whom such obligation was
owing against such loss. If the amount of the Agreement Currency so purchased is
greater than the sum originally due to the Administrative Agent in such
currency, the Administrative Agent agrees to return the amount of any excess to
the Borrower (or to any other Person who may be entitled thereto under
applicable law).
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
BORROWER: GENESCO INC.,
a Tennessee corporation
By: /s/ James S. Gulmi
---------------------------------------
Name: James S. Gulmi
Title: Senior Vice President - Finance
and Chief Financial Officer
GUARANTORS: GENESCO BRANDS INC.,
a Delaware corporation
By: /s/ James S. Gulmi
---------------------------------------
Name: James S. Gulmi
Title: President
HAT WORLD CORPORATION,
a Delaware corporation
By: /s/ James S. Gulmi
---------------------------------------
Name: James S. Gulmi
Title: Senior Vice President - Finance
and Chief Financial Officer
HAT WORLD INC.,
a Minnesota corporation
By: /s/ James S. Gulmi
---------------------------------------
Name: James S. Gulmi
Title: Senior Vice President - Finance
and Chief Financial Officer
ADMINISTRATIVE BANK OF AMERICA, N.A., as
AGENT: Administrative Agent
By: /S/ Molly J. Oxford
------------------------------
Name: Molly J. Oxford
Title: Vice President
LENDERS: BANK OF AMERICA, N.A., Individually
in its capacity as L/C Issuer and
a Lender
By: /s/ Amy Honey
-----------------------------------
Name: Amy Honey
Title: Vice President
LASALLE BANK NATIONAL ASSOCIATION
By: /s/ Andrew J. Crask
-----------------------------------
Name: Andrew J. Crask
Title: AVP
WELLS FARGO FOOTHILL, LLC
By: /s/ Rina Shinoda
-----------------------------------
Name: Rina Shinoda
Title: Vice President
NATIONAL CITY BANK
By: /s/ Michael J. Durbin
-----------------------------------
Name: Michael J. Durbin
Title: Senior Vice President
SUN TRUST BANK
By: /s/ Scott Corley
-----------------------------------
Name: Scott Corley
Title: Managing Director
U.S. BANK NATIONAL ASSOCIATION
By: /s/ Jennifer Thurston
-----------------------------------
Name: Jennifer Thurston
Title: Assistant Vice President
BRANCH BANKING & TRUST COMPANY
By: /s/ Roberts A. Bass
-----------------------------------
Name: Roberts A. Bass
Title: Senior Vice President
FIFTH THIRD BANK
By: /s/ David J. Hicks
-----------------------------------
Name: David J. Hicks
Title: Vice President
PNC BANK NATIONAL ASSOCIATION
By: /s/ Chester A. Misbach, Jr.
-----------------------------------
Name: Chester A. Misbach, Jr.
Title: Senior Vice President
WASHINGTON MUTUAL BANK
By: /s/ Elizabeth Records
-----------------------------------
Name: Elizabeth Records
Title: Assistant Vice President,
Credit Manager