$200,000,000
CREDIT AGREEMENT
AMONG
HENRY SCHEIN, INC.,
THE SEVERAL GUARANTORS FROM TIME TO TIME PARTIES HERETO,
JPMORGAN CHASE BANK
AS ADMINISTRATIVE AGENT, SWINGLINE LENDER,
ISSUING LENDER, SOLE LEAD ARRANGER AND SOLE BOOKRUNNER,
FLEET NATIONAL BANK
AS SYNDICATION AGENT,
THE SEVERAL LENDERS
FROM TIME TO TIME PARTIES HERETO.
DATED AS OF MAY 2, 2002
================================================================================
CREDIT AGREEMENT, dated as of May 2, 2002, among (i) Henry Schein, Inc., a
Delaware corporation (the "BORROWER"), (ii) the several Guarantors from time to
time parties hereto (the "GUARANTORS"), (iii) JPMorgan Chase Bank ("JPMCB"), as
Sole Lead Arranger (in such capacity, the "SOLE LEAD ARRANGER"), Sole Bookrunner
(in such capacity, the "SOLE BOOKRUNNER"), Swingline Lender (in such capacity,
the "SWINGLINE LENDER"), Issuing Lender (in such capacity, the "ISSUING
LENDER"), and Administrative Agent for the Lenders hereunder (in such capacity,
the "ADMINISTRATIVE AGENT"), (iv) Fleet National Bank (in such capacity, the
"SYNDICATION AGENT") and (v) the several Lenders and other financial
institutions or entities from time to time parties hereto (the "LENDERS").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Borrower, certain of the Lenders, and the Administrative Agent
are among the parties to the Revolving Credit Agreement, dated as of January 31,
1997 (as amended, supplemented or otherwise modified prior to the date hereof,
the "EXISTING FACILITY");
WHEREAS, the Borrower intends to terminate the Existing Facility and has
requested that the Lenders make available a four-year credit facility as
described herein; and
WHEREAS, the Lenders have agreed to make such credit facility available
upon the terms and subject to the conditions set forth herein;
NOW, THEREFORE, in consideration of the premises, and of the mutual
covenants and agreements herein contained and other good and valuable
consideration, receipt of which is hereby acknowledged, the parties hereto
hereby agree as follows:
Section 1. DEFINITIONS
1.1 DEFINED TERMS.
-------------
As used in this Agreement, the following terms shall have the
following meanings:
"ABR": for any day, a rate per annum (rounded upwards, if necessary, to the
next 1/100 of 1%) equal to the greatest of (a) the Prime Rate in effect on such
day, and (b) the Federal Funds Effective Rate in effect on such day plus 1/4 of
1%. For purposes hereof: "PRIME RATE" shall mean the rate of interest per annum
publicly announced from time to time by JPMCB as its prime rate in effect at its
principal office in New York City (the Prime Rate not being intended to be the
lowest rate of interest charged by JPMCB in connection with extensions of credit
to debtors); and "FEDERAL FUNDS EFFECTIVE RATE" shall mean, for any day, the
weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers, as
published on the next succeeding Business Day by the Federal Reserve Bank of New
York, or, if such rate is not so published for any day which is a Business Day,
the average of the quotations for the day of such transactions received by the
Administrative Agent from three federal funds brokers of recognized standing
selected by it. Any change in the ABR due to a change in the Prime Rate or the
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Federal Funds Effective Rate shall be effective as of the opening of business on
the effective day of such change in the Prime Rate or the Federal Funds
Effective Rate, respectively.
"ABR LOANS": Revolving Credit Loans bearing interest at a rate per annum
determined by reference to the ABR.
"ACQUISITION": the acquisition of (a) a controlling equity or other
ownership interest in a Person (including the purchase of an option, warrant or
convertible or similar type security to acquire such a controlling interest at
the time it becomes exercisable by the holder thereof), whether by purchase of
such controlling equity or other ownership interest or upon exercise of an
option or warrant for, or conversion of securities into, such controlling equity
or other ownership interest, or (b) assets of a Person which constitute all or
substantially all of the assets of such Person or of a line or lines of business
conducted by such Person.
"ADJUSTED LIBO RATE": with respect to each day during each Interest Period
pertaining to a LIBOR Loan, a rate per annum determined for such day in
accordance with the following formula (rounded upward to the nearest 1/100th of
1%):
LIBO RATE
---------
1.00 - Eurocurrency Reserve Requirements
"ADMINISTRATIVE AGENT": JPMCB, as the Administrative Agent for the Lenders
under this Agreement and the other Loan Documents.
"ADMINISTRATIVE QUESTIONNAIRE": an administrative questionnaire in a form
supplied by the Administrative Agent.
"AFFILIATE": as to any Person, any other Person (other than a Subsidiary)
which, directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. For purposes of this definition, "control" of
a Person means the power, directly or indirectly, either to (a) vote 25% or more
of the securities having ordinary voting power for the election of directors of
(or persons performing similar functions for) such Person or (b) direct or cause
the direction of the management and policies of such Person, whether by contract
or otherwise.
"AGENTS": the collective reference to the Administrative Agent, the Sole
Lead Arranger, the Sole Bookrunner and the Syndication Agent.
"AGGREGATE AVAILABLE MULTICURRENCY COMMITMENTS": as at any date of
determination, an amount in Dollars equal to the sum of the Available
Multicurrency Commitments of all Lenders on such date.
"AGGREGATE AVAILABLE REVOLVING CREDIT COMMITMENTS": as at any date of
determination with respect to all Lenders, an amount in Dollars equal to the sum
of the Available Revolving Credit Commitments of all Lenders on such date.
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"AGGREGATE MULTICURRENCY COMMITMENTS": the obligations of the Lenders to
make Multicurrency Loans hereunder in an aggregate principal amount at any one
time outstanding not to exceed $75,000,000.
"AGGREGATE MULTICURRENCY OUTSTANDINGS": as at any date of determination
with respect to any Lender, the Dollar Equivalent of the principal amount of
such Lender's outstanding Multicurrency Loans on such date.
"AGGREGATE REVOLVING CREDIT COMMITMENTS": the aggregate amount of the
Revolving Credit Commitments of all of the Lenders.
"AGGREGATE REVOLVING CREDIT OUTSTANDINGS": as at any date of determination
with respect to any Lender, an amount in Dollars equal to the sum of (a) the
aggregate unpaid principal amount of such Lender's Revolving Credit Loans (in
the case of outstanding Multicurrency Loans, Aggregate Multicurrency
Outstandings) on such date plus (b) such Lender's Revolving Credit Commitment
Percentage of (i) the Aggregate Swingline Outstandings and (ii) the L/C
Obligations.
"AGGREGATE SWINGLINE OUTSTANDINGS": as at any date of determination, the
aggregate unpaid principal amount of Swingline Loans.
"AGREEMENT": this Credit Agreement, as amended, supplemented or otherwise
modified from time to time.
"APPLICABLE MARGIN": with respect to each day for LIBOR Loans, the rate per
annum based on the Consolidated Leverage Ratio for such day, as set forth under
the relevant column heading below:
------------------ ------------------------ -----------------------
Tier Ratio Applicable Margin (bps)
------------------ ------------------------ -----------------------
I >=2.50:1.00 102.5
------------------ ------------------------ -----------------------
II >=2.00:1.00 and less 80.0
than 2.50:1.00
------------------ ------------------------ -----------------------
III >=1.00:1.00 and less 62.5
than 2.00:1.00
------------------ ------------------------ -----------------------
IV <1.00:1.00 50.0
------------------ ------------------------ -----------------------
The Applicable Margin will be set on the day which is five Business Days
following the receipt by the Administrative Agent of the financial statements
referenced in subsection 7.1(a) or subsection 7.1(b), as the case may be, and
shall apply to all LIBOR Loans (i.e., existing, new or additional Loans, or
Loans which are continuations or conversions) then outstanding (i.e., subject to
the below provisions, outstanding LIBOR Loans shall bear interest at the new
Applicable Margin from and after the date any such margin is reset in accordance
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with the provisions hereof; prior to such time, such LIBOR Loans shall accrue
interest based on the Applicable Margin relating to the period immediately prior
to the time such margin is reset in accordance with the provisions hereof) or to
be made on or after such date until, but not including, the next date on which
the Applicable Margin is reset in accordance with the provisions hereof;
provided, however, that notwithstanding the foregoing, if any financial
statements are not received by the Administrative Agent within the time period
relating to such financial statements as provided in subsection 7.1(a) or
subsection 7.1(b) as the case may be, the Applicable Margin on all LIBOR Loans
then outstanding or to be made on or after the date the Applicable Margin should
have been reset in accordance with the foregoing provisions (i.e., assuming
timely delivery of the requisite financial statements), until the day which is
five Business Days following the receipt by the Administrative Agent of such
financial statements, will be 1.025%; and further provided, however, that the
Lenders shall not in any way be deemed to have waived any Event of Default or
any remedies hereunder (including, without limitation, remedies provided in
Section 9) in connection with the provisions of the foregoing proviso.
"APPLICATION": an application, in such form as the Issuing Lender may
specify from time to time, requesting the Issuing Lender to issue a Letter of
Credit.
"APPROVED FUND": as defined in subsection 11.6(b).
"ASSIGNEE": as defined in subsection 11.6(b).
"ATTORNEY COSTS": all reasonable fees and disbursements of any law firm or
other external counsel.
"AUSTRALIAN DOLLARS": the lawful currency of Australia.
"AVAILABLE FOREIGN CURRENCIES": Euro, Japanese Yen, Australian Dollars,
Canadian Dollars, Pounds Sterling, Swiss Francs and any other available and
freely-convertible non-Dollar currency in which dealings in deposits are carried
out in the London interbank market which are selected by the Borrower and
approved by the Administrative Agent and each of the Lenders.
"AVAILABLE MULTICURRENCY COMMITMENT": as at any date of determination with
respect to any Lender, an amount in Dollars equal to the excess, if any, of (a)
the amount of such Lender's Multicurrency Commitment OVER (b) the Dollar
Equivalent of the Aggregate Multicurrency Outstandings of such Lender on such
date.
"AVAILABLE REVOLVING CREDIT COMMITMENT": as at any date of determination
with respect to any Lender, an amount in Dollars equal to the excess, if any, of
(a) the amount of such Lender's Revolving Credit Commitment in effect on such
date OVER (b) the Aggregate Revolving Credit Outstandings of such Lender on such
date.
"BORROWER": as defined in the preamble hereto.
"BORROWING": any extension of credit under this Agreement.
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"BORROWING DATE": any Business Day specified in a notice pursuant to
Section 2 or Section 4 as a date on which the Borrower requests the Lenders to
extend credit, make Loans or issue Letters of Credit hereunder.
"BRITISH POUNDS STERLING" AND "POUNDS STERLING": the lawful currency of the
United Kingdom of Great Britain and Northern Ireland.
"BUSINESS": as defined in subsection 5.10.
"BUSINESS DAY": a day other than a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to close;
PROVIDED, that (a) if such day relates to any Multicurrency Loan denominated in
a currency other than Euro, such term shall mean any such day on which dealings
in deposits in the relevant currency are conducted by and between banks in the
applicable foreign currency or foreign exchange interbank market, (b) if such
day relates to any Multicurrency Loan denominated in euro, such term shall mean
Target Operating Days, and (c) if such day relates to any LIBOR Loan in Dollars,
such term shall mean a day other than a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to close
which is also a London Business Day.
"CANADIAN DOLLARS": the lawful currency of Canada.
"CAPITAL LEASE OBLIGATIONS": as to any Person, the obligations of such
Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP and, for the purposes of
this Agreement, the amount of such obligations at any time shall be the
capitalized amount thereof at such time determined in accordance with GAAP.
"CLO": as defined in subsection 11.6(b).
"CLOSING DATE": the date, on or before May 2, 2002, on which the conditions
precedent set forth in subsection 6.1 shall be satisfied.
"CODE": the Internal Revenue Code of 1986, as amended from time to time.
"COMMITMENT INCREASE DATE": as defined in subsection 2.7(a).
"COMMITMENT PERIOD": the period from and including the Closing Date to but
not including the Termination Date.
"COMMITMENTS": the collective reference to the Revolving Credit
Commitments, Multicurrency Commitments, Swingline Commitments and L/C
Commitment.
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"COMMITTED OUTSTANDINGS PERCENTAGE": on any date with respect to any
Lender, the percentage which the Aggregate Revolving Credit Outstandings of such
Lender constitutes of the Aggregate Revolving Credit Outstandings of all
Lenders.
"COMMONLY CONTROLLED ENTITY": an entity, whether or not incorporated, which
is under common control with the Borrower within the meaning of Section 4001 of
ERISA or is part of a group which includes the Borrower and which is treated as
a single employer under Section 414 of the Code , except that for purposes of
Title IV of ERISA, a "Commonly Controlled Entity" means an entity, whether or
not incorporated, which is under common control with the Borrower within the
meaning of Section 4001 of ERISA.
"CONSOLIDATED EBITDA": for any period, Consolidated Operating Income plus,
without duplication, (a) Consolidated Interest Income, (b) depreciation, (c)
amortization and (d) the Designated Charges of the Borrower and its Subsidiaries
for such period, determined on a consolidated basis and as calculated consistent
with the manner disclosed by the Borrower in its Annual Report on Form 10-K for
the fiscal year ended December 29, 2001.
"CONSOLIDATED GROSS PROFIT": for any period, net sales less cost of sales
of the Borrower and its Subsidiaries for such period, determined on a
consolidated basis in accordance with GAAP and as calculated consistent with the
manner disclosed by the Borrower in its Annual Report on Form 10-K for the
fiscal year ended December 29, 2001.
"CONSOLIDATED INTEREST COVERAGE RATIO": for any date of determination, the
ratio of (a) Consolidated EBITDA for the period of the four prior fiscal
quarters ending on (or most recently ended prior to) such date to (b)
Consolidated Interest Expense for such period.
"CONSOLIDATED INTEREST EXPENSE": for any period, total interest expense
(including, without limitation, rent or interest expense pursuant to Capital
Lease Obligations that is treated as interest in accordance with GAAP) of the
Borrower and its Subsidiaries for such period, determined on a consolidated
basis in accordance with GAAP and as calculated consistent with the manner
disclosed by the Borrower in its Annual Report on Form 10-K for the fiscal year
ended December 29, 2001.
"CONSOLIDATED INTEREST INCOME": for any period, the interest income of the
Borrower and its Subsidiaries for such period, determined on a consolidated
basis in accordance with GAAP and as calculated consistent with the manner
disclosed by the Borrower in its Annual Report on Form 10-K for the fiscal year
ended December 29, 2001.
"CONSOLIDATED LEVERAGE RATIO": at any date of determination, the ratio of
(a) Consolidated Total Debt on such date to (b) Consolidated EBITDA for the
period of the four fiscal quarters ending on (or most recently ended prior to)
such date.
"CONSOLIDATED OPERATING EXPENSES": for any period, total expenses related
to salaries, employee benefits and general and administrative expenses of the
Borrower and its Subsidiaries determined on a consolidated basis in accordance
7
with GAAP and as calculated consistent with the manner disclosed by the Borrower
in its Annual Report on Form 10-K for the fiscal year ended December 29, 2001.
"CONSOLIDATED OPERATING INCOME": for any period, Consolidated Gross Profit
less Consolidated Operating Expenses of the Borrower and its Subsidiaries
determined on a consolidated basis in accordance with GAAP and as calculated
consistent with the manner disclosed by the Borrower in its Annual Report on
Form 10-K for the fiscal year ended December 29, 2001.
"CONSOLIDATED TOTAL ASSETS": at any date of determination, the net book
value of all assets of the Borrower and its Subsidiaries determined on a
consolidated basis in accordance with GAAP and as calculated consistent with the
manner disclosed by the Borrower in its Annual Report on Form 10-K for the
fiscal year ended December 29, 2001.
"CONSOLIDATED TOTAL DEBT": at any date of determination, the aggregate
amount of all Indebtedness of the Borrower and its Subsidiaries determined on a
consolidated basis in accordance with GAAP and as calculated consistent with the
manner disclosed by the Borrower in its Annual Report on Form 10-K for the
fiscal year ended December 29, 2001.
"CONTINUING DIRECTORS": as to the Borrower, the directors of the Borrower
on the Closing Date and each other director of the Borrower whose nomination for
election to the Board of Directors of Borrower is recommended by a majority of
the then Continuing Directors.
"CONTRACTUAL OBLIGATION": as to any Person, any provision of any security
issued by such Person or of any agreement, instrument or other undertaking to
which such Person is a party or by which it or any of its property is bound.
"DEFAULT": any event or circumstance that, with the giving of any notice,
the passage of time, or both, would be an Event of Default.
"DESIGNATED CHARGES": for any period, to the extent deducted in computing
Consolidated Operating Income, the aggregate of total (a) non-cash,
non-recurring merger and integration costs, and (b) non-cash, non-recurring
restructuring costs, of the Borrower and its Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP and as calculated
consistent with the manner disclosed by the Borrower in its Annual Report on
Form 10-K for the fiscal year ended December 29, 2001.
"DISPOSITION" OR "DISPOSE": the sale, transfer, license or other
disposition (including any sale and leaseback transaction) of any property by
any Person, including any sale, assignment, transfer or other disposal, with or
without recourse, of any notes or accounts receivable or any rights and claims
associated therewith.
"DISPOSITION VALUE": (a) in the case of property that does not constitute
Subsidiary Stock, the book value thereof, valued at the time of such Disposition
in good faith by the Borrower, and (b) in the case of property that constitutes
Subsidiary Stock, an amount equal to that percentage of book value of the assets
8
of the Subsidiary that issued such stock as is equal to the percentage that the
book value of such Subsidiary Stock represents of the book value of all of the
outstanding Equity Interests of such Subsidiary (assuming, in making such
calculations, that all securities convertible into such Equity Interests are so
converted and giving full effect to all transactions that would occur or be
required in connection with such conversion) determined at the time of the
Disposition thereof, in good faith by the Borrower.
"DOLLAR EQUIVALENT": with respect to an amount denominated in any currency
other than Dollars, the equivalent in Dollars of such amount determined at the
Exchange Rate on the date of determination of such equivalent in accordance with
the provisions of the next sentence. In making any determination of the Dollar
Equivalent for purposes of calculating the amount of Loans to be borrowed from
the respective Lenders on any Borrowing Date, the Administrative Agent shall use
the relevant Exchange Rate in effect on the date on which the interest rate for
such Loans is determined pursuant to the provisions of this Agreement and the
other Loan Documents.
"DOMESTIC SUBSIDIARY": any Subsidiary other than a Foreign Subsidiary.
"DOLLARS" and "$": lawful currency of the United States of America.
"EMU": the economic and monetary unit in accordance with the Treaty of Rome
of 1957, as amended by the Single European Act 1986, the Maastricht Treaty of
1992, and the Amsterdam Treaty of 1998, as amended from time to time.
"EMU LEGISLATION": legislative measures of the European Council (including
without limitation European Council regulations) for the introduction of,
changeover to or operation of a single or unified European currency (whether
known as the euro or otherwise), in each case as amended or supplemented from
time to time.
"ENVIRONMENTAL LAWS": any and all applicable foreign, Federal, state, local
or municipal laws, rules, regulations, statutes, ordinances, codes, decrees, or
other enforceable requirements or orders of any Governmental Authority or other
Requirements of Law regulating, relating to or imposing liability or standards
of conduct concerning protection of human health or the environment, as now or
may at any time hereafter be in effect.
"EQUITY INTERESTS": any and all shares of capital stock, partnership
interests, membership interests in a limited liability company, beneficial
interests in a trust or other equity ownership interests in a Person, and any
warrants, options or other rights entitling the holder thereof to purchase or
acquire any such equity interests.
"ERISA": the Employee Retirement Income Security Act of 1974, as amended
from time to time.
"EURO": the single currency of participating member states of the European
Union.
9
"EUROCURRENCY RESERVE REQUIREMENTS": for any day as applied to a Loan, the
aggregate (without duplication) of the rates (expressed as a decimal fraction)
of reserve requirements actually imposed on such day (including, without
limitation, basic, supplemental, marginal and emergency reserves) under any
regulations of the Board of Governors of the Federal Reserve System or other
Governmental Authority having jurisdiction with respect thereto dealing with
reserve requirements prescribed for eurocurrency funding (currently referred to
as "Eurocurrency Liabilities" in Regulation D of such Board) maintained by a
member bank of such System. The determination of Eurocurrency Reserve
Requirements by the Administrative Agent shall be conclusive in the absence of
manifest error.
"EVENT OF DEFAULT": any of the events specified in Section 9.
"EXCESS UTILIZATION DAY": any day on which the sum of the Aggregate
Revolving Credit Outstandings of all Lenders exceeds 50% of the Aggregate
Revolving Credit Commitments.
"EXCHANGE RATE": with respect to any non-Dollar currency on any date, the
rate at which such currency may be exchanged into Dollars, as set forth on such
date on the relevant Reuters currency page at or about 11:00 A.M., London time,
on such date. In the event that such rate does not appear on any Reuters
currency page, the "Exchange Rate" with respect to such non-Dollar currency
shall be determined by reference to such other publicly available service for
displaying exchange rates as may be agreed upon by the Administrative Agent and
the Borrower or, in the absence of such agreement, such "Exchange Rate" shall
instead be the Spot Rate of exchange in the interbank market where its foreign
currency exchange operations in respect of such non-Dollar currency are then
being conducted, at or about 10:00 A.M., local time, on such date for the
purchase of Dollars with such non-Dollar currency, for delivery two Business
Days later; PROVIDED, that if at the time of any such determination, no such
Spot Rate can reasonably be quoted, the Administrative Agent after consultation
with the Borrower may use any reasonable method as the Administrative Agent
deems applicable to determine such rate, and such determination shall be
conclusive absent manifest error.
"EXISTING FACILITY": as defined in the recitals hereto.
"EXISTING LETTERS OF CREDIT": those letters of credit which are
individually described on SCHEDULE II.
"FACILITY FEE RATE": for each day during each calculation period, the rate
per annum based on the Consolidated Leverage Ratio for such day, as set forth
below:
------------------ ------------------------ -----------------------
FACILITY FEE
TIER RATIO (BPS)
------------------ ------------------------ -----------------------
I >=2.50:1.00 22.5
------------------ ------------------------ -----------------------
II >=2.00:1.00 and less 20.0
than 2.50:1.00
------------------ ------------------------ -----------------------
III >=1.00:1.00 and less 17.5
than 2.00:1.00
------------------ ------------------------ -----------------------
10
------------------ ------------------------ -----------------------
IV <1.00:1.00 15.0
------------------ ------------------------ -----------------------
The applicable Facility Fee will be set on the day which is five Business Days
following the receipt by the Administrative Agent of the financial statements
referenced in subsection 7.1(a) or subsection 7.1(b), as the case may be, and
shall apply until, but not including, the next date on which the applicable
Facility Fee is reset in accordance with the provisions hereof; provided,
however, that notwithstanding the foregoing, if any financial statements are not
received by the Administrative Agent within the time period relating to such
financial statements as provided in subsection 7.1(a) or subsection 7.1(b), as
the case may be, the applicable Facility Fee will be 0.225% until the day which
is five Business Days following the receipt by the Administrative Agent of such
financial statements; and further provided, however, that the Lenders shall not
in any way be deemed to have waived any Event of Default or any remedies
hereunder (including, without limitation, remedies provided in Section 9) in
connection with the provisions of the foregoing proviso.
"FAIR MARKET VALUE": at any time and with respect to any property, the sale
value of such property that would be realized in an arm's-length sale at such
time between an informed and willing buyer and an informed and willing seller
(neither being under a compulsion to buy or sell).
"FEDERAL FUNDS EFFECTIVE RATE": as defined in the definition of "ABR" in
this subsection 1.1.
"FEE COMMENCEMENT DATE": the Closing Date.
"FINANCING LEASE": any lease of property, real or personal, the obligations
of the lessee in respect of which are Capital Lease Obligations on a balance
sheet of the lessee.
"FOREIGN SUBSIDIARY": any Subsidiary incorporated or otherwise organized in
any jurisdiction outside the United States of America, its territories and
possessions.
"FUNDING COMMITMENT PERCENTAGE": as at any date of determination, with
respect to any Lender, that percentage which the Available Revolving Credit
Commitment of such Lender then constitutes of the Aggregate Available Revolving
Credit Commitments.
"GAAP": generally accepted accounting principles in the United States of
America consistently applied with respect to those utilized in preparing the
audited financial statements referred to in subsection 5.1.
"GOVERNMENTAL AUTHORITY": any nation or government, any state or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.
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"GUARANTORS": each of Roane Barker, Inc., Dentrix Dental Systems, Inc., HSI
Service Corp., Micro Bio-Medics, Inc. and GIV Holdings, Inc., any Subsidiaries
or Affiliates that are guarantors under or with respect to any of the Note
Purchase Agreements from time to time from and after the date hereof, and any
Significant Subsidiary of the Borrower from time to time formed, acquired,
organized or existing from and after the date hereof.
"GUARANTEE OBLIGATION": as to any Person (the "GUARANTEEING PERSON"), any
obligation of (a) the guaranteeing person or (b) another Person (including,
without limitation, any bank under any letter of credit) to induce the creation
of which the guaranteeing person has issued a reimbursement, counterindemnity or
similar obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the "PRIMARY OBLIGATIONS")
of any other unrelated third Person (the "PRIMARY OBLIGOR") in any manner,
whether directly or indirectly, including, without limitation, any obligation of
the guaranteeing person, whether or not contingent, (i) to purchase any such
primary obligation or any property constituting direct or indirect security
therefor, (ii) to advance or supply funds (1) for the purchase or payment of any
such primary obligation or (2) to maintain working capital or equity capital of
the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase property, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation or
(iv) otherwise to assure or hold harmless the owner of any such primary
obligation against loss in respect thereof; PROVIDED, HOWEVER, that the term
Guarantee Obligation shall not include endorsements of instruments for deposit
or collection in the ordinary course of business. The amount of any Guarantee
Obligation 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 Obligation 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.
"INDEBTEDNESS": of any Person at any date, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of property or services, (c) all
obligations of such Person evidenced by notes, bonds, debentures or other
similar instruments, (d) all obligations of such person created or arising under
any conditional sale or other title retention agreement with respect to property
acquired by such Person, (e) all Capital Lease Obligations of such Person, (f)
all obligations of such Person, contingent or otherwise, as an account party or
applicant under or in respect of bankers' acceptances, letters of credit, surety
bonds or similar arrangements, (g) all indebtedness of such Person, determined
in accordance with GAAP, arising out of a Receivables Transaction, (h) all
Guarantee Obligations of such Person; (i) all obligations of such Person secured
by (or for which the holder of such obligation has an existing right, contingent
or otherwise, to be secured by) any Lien on property (including accounts and
contract rights) owned by such Person, whether or not such Person has assumed or
become liable for the payment of such obligation; PROVIDED, HOWEVER, that in the
event that liability of such Person is non-recourse to such Person and is
recourse only to specified property owned by such Person, the amount of
Indebtedness attributed thereto shall not exceed the greater of the Fair Market
Value of such property or the net book value of such property, and (j) for the
purposes of subsection 9(d) only (except to the extent otherwise included
above), all obligations of such Person in respect of Swap Agreements; provided
12
that for the purposes of subsection 9(d), the "principal amount" of the
obligations of such Person in respect of any Swap Agreement at any time shall be
the maximum aggregate amount (giving effect to any netting agreements) that such
Person would be required to pay if such Swap Agreement were terminated at such
time. The Indebtedness of any Person shall include the Indebtedness of any other
entity (including any partnership in which such Person is a general partner) to
the extent such Person is actually liable therefor as a result of such Person's
ownership interest in or other relationship with such entity, except to the
extent the terms of such Indebtedness expressly provide that such Person is not
actually liable therefor.
"INSOLVENCY": with respect to any Multiemployer Plan, the condition that
such Plan is insolvent within the meaning of Section 4245 of ERISA.
"INSOLVENT": pertaining to a condition of Insolvency.
"INTEREST PAYMENT DATE": (a) as to any ABR Loan, the last day of each
March, June, September and December; (b) as to any LIBOR Loan having an Interest
Period of three months or less, the last day of such Interest Period; (c) as to
any LIBOR Loan having an Interest Period longer than three months, each day
which is three months, or a whole multiple thereof, after the first day of such
Interest Period and the last day of such Interest Period; and (d) as to any
Swingline Loan, the earlier to occur of (i) the maturity date thereof and (ii)
the date the same shall have been prepaid in accordance with the provisions of
this Agreement.
"INTEREST PERIOD": with respect to any LIBOR Loan:
(i) initially, the period commencing on the Borrowing Date or conversion
date, as the case may be, with respect to such LIBOR Loan and ending one, two,
three or six months thereafter, as selected by the Borrower in its notice of
borrowing or notice of conversion, as the case may be, given with respect
thereto; and
(ii) thereafter, each period commencing on the last day of the next
preceding Interest Period applicable to such LIBOR Loan and ending one, two,
three or six months thereafter, as selected by the Borrower by irrevocable
notice to the Administrative Agent not less than three Business Days, in the
case of LIBOR Loans in Dollars, and four Business Days, in the case of LIBOR
Loans in Available Foreign Currencies, prior to the last day of the then current
Interest Period with respect thereto; PROVIDED that, all of the foregoing
provisions relating to Interest Periods are subject to the following:
(1) if any Interest Period would otherwise end on a day that is not a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless the result of such extension would be to carry such Interest
Period into another calendar month in which event such Interest Period shall end
on the immediately preceding Business Day;
(2) any Interest Period in respect of any Loan made by any Lender that
would otherwise extend beyond the Termination Date applicable to such Lender
shall end on such Termination Date; and
13
(3) 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 a calendar month.
"IRS": The United States Internal Revenue Service and any successor
governmental agency performing a similar function.
"ISSUING LENDER": JPMCB, in its capacity as issuer of any Letter of Credit,
and its successors. The Issuing Lender may, in its discretion, arrange for one
or more Letters of Credit to be issued by Affiliates of the Issuing Lender, in
which case the term "Issuing Lender" shall include any such Affiliate with
respect to Letters of Credit issued by such Affiliate.
"JAPANESE YEN": the official legal currency of Japan.
"JPMCB": JPMorgan Chase Bank.
"JUDGMENT CURRENCY": as defined in subsection 11.15.
"L/C COMMITMENT": the obligation of the Issuing Lender to issue Letters of
Credit pursuant to Section 4 with respect to which the resulting L/C Obligations
at any one time outstanding shall not exceed $15,000,000.
"L/C FEE PAYMENT DATE": the last day of each March, June, September and
December and the last day of the Commitment Period.
"L/C OBLIGATIONS": at any time, an amount equal to the sum of (a) the
aggregate then undrawn and unexpired amount of the then outstanding Letters of
Credit and (b) the aggregate amount of drawings under Letters of Credit that
have not then been reimbursed pursuant to subsection 4.5.
"L/C PARTICIPANTS": the collective reference to all the Lenders other than
the Issuing Lender.
"LENDER AFFILIATE": (a) any Affiliate of any Lender, (b) any Person that is
administered or managed by any Lender and that is engaged in making, purchasing,
holding or otherwise investing in commercial loans and similar extensions of
credit in the ordinary course of its business and (c) with respect to any Lender
which is a fund that invests in commercial loans and similar extensions of
credit, any other fund that invests in commercial loans and similar extensions
of credit and is managed or advised by the same investment advisor as such
Lender or by an Affiliate of such Lender or investment advisor.
"LENDERS": as defined in the preamble hereto, and any other Person that
shall have become a party hereto pursuant to an Assignment and Assumption (as
defined in subsection 11.6), other than any such Person that ceases to be a
14
party hereto pursuant to an Assignment and Assumption; PROVIDED, that unless the
context otherwise requires, each reference herein to the Lenders shall be deemed
to include any Approved Fund.
"LETTERS OF CREDIT": as defined in subsection 4.1(a).
"LIBOR LOANS": Revolving Credit Loans with respect to which the rate of
interest is based upon the Adjusted LIBO Rate.
"LIBO RATE": with respect to each day during each Interest Period
pertaining to a LIBOR Loan denominated in Dollars or any Available Foreign
Currencies, the rate per annum determined by the Administrative Agent to be the
offered rate for deposits in the currency in which such LIBOR Loan is
denominated with a term comparable to such Interest Period that appears on the
applicable Telerate Page (or on any successor or substitute page or service, or
any successor to or substitute for such page or service, providing rate
quotations comparable to those currently provided on such page or service, as
reasonably determined by the Administrative Agent from time to time for purposes
of providing quotations of interest rates applicable to deposits in the currency
in which such LIBOR Loan is denominated in the London interbank market) at
approximately 11:00 A.M., London time, two Business Days prior to the beginning
of such Interest Period; PROVIDED, HOWEVER, that if at any time for any reason
such offered rate for any such currency shall not be available, "LIBO Rate"
shall mean, with respect to each day during each Interest Period pertaining to a
LIBOR Loan denominated in such currency, the rate per annum reasonably
determined by the Administrative Agent as the rate of interest at which deposits
in the relevant currency for delivery on the first day of such Interest Period
in same day funds in the amount of $5,000,000 and with a term equivalent to such
Interest Period would be offered by JPMCB's London branch or London Affiliate to
major banks in the London interbank market at their request at approximately
11:00 a.m. (London time) two Business Days prior to the first day of such
Interest Period. The determination of the LIBO Rate by the Administrative Agent
shall be conclusive in the absence of manifest error.
"LIEN": any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or any preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation, any
conditional sale or other title retention agreement and any Financing Lease
having substantially the same economic effect as any of the foregoing).
"LOAN": any Revolving Credit Loan, extension of credit under or pursuant to
Section 4, or Swingline Loan, as the case may be.
"LOAN DOCUMENTS": this Agreement, any Notes, the Administrative Agent/Sole
Lead Arranger Fee Letter (as defined in subsection 2.5(c)), each Application and
all other instruments and documents heretofore or hereafter executed or
delivered to or in favor of any Lender or the Administrative Agent in connection
with the Loans made and transactions contemplated by this Agreement.
15
"LONDON BUSINESS DAY": any day on which banks in London are open for
general banking business, including dealings in foreign currency and exchange.
"MAJORITY LENDERS": (a) at any time prior to the termination of the
Revolving Credit Commitments, Lenders whose Revolving Credit Commitment
Percentages aggregate more than 50%; and (b) notwithstanding the foregoing, for
purposes of declaring the Loans to be due and payable pursuant to Section 9, and
at any time after the termination of the Revolving Credit Commitments, Lenders
whose Aggregate Revolving Credit Outstandings aggregate more than 50% of the
Aggregate Revolving Credit Outstandings of all Lenders.
"MATERIAL ADVERSE EFFECT": a material adverse effect on (i) the business,
assets, property or condition (financial or otherwise) of the Borrower and its
Subsidiaries, taken as a whole, or (ii) the validity or enforceability of any of
the Loan Documents or the rights or remedies of the Administrative Agent and the
Lenders thereunder, provided that events, developments or circumstances
("Changes") (including general economic or political conditions) generally
affecting the Borrower's industry which are not reasonably likely to have a
material adverse effect on (x) the business, assets, property or condition
(financial or otherwise) of the Borrower and its Subsidiaries, taken as a whole,
or (y) the validity or enforceability of any of the Loan Documents or the rights
or remedies of the Administrative Agent or Lenders thereunder, will not be
deemed Changes for purposes of determining whether a Material Adverse Effect
shall have occurred.
"MATERIALS OF ENVIRONMENTAL CONCERN": any gasoline or petroleum (including
crude oil or any fraction thereof) or petroleum products or any hazardous or
toxic substances, materials or wastes, defined or regulated as such in or under
any Environmental Law, including, without limitation, friable asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.
"MULTICURRENCY COMMITMENT": as to any Lender, the obligation of such Lender
to make Multicurrency Loans to the Borrower hereunder in an aggregate principal
amount at any one time outstanding not to exceed the amount set forth opposite
such Lender's name on SCHEDULE I under the heading "Multicurrency Commitment,"
and that such amount may be modified from time to time in accordance with the
provisions of this Agreement.
"MULTICURRENCY COMMITMENT PERCENTAGE": as to any Lender at any time, the
percentage which such Lender's Multicurrency Commitment at such time constitutes
of the Aggregate Multicurrency Commitments at such time.
"MULTICURRENCY LOANS": Revolving Credit Loans made in Available Foreign
Currencies.
"MULTIEMPLOYER PLAN": a Plan which is a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"NON-EXCLUDED TAXES": as defined in subsection 3.10.
16
"NOTES": the collective reference to any Revolving Credit Notes and any
Swingline Notes.
"NOTE PURCHASE AGREEMENTS": those certain Note Purchase Agreements dated as
of June 30, 1999 and September 25, 1998, respectively, as amended, between the
Borrower and the various note holders party thereto.
"OBLIGATIONS": collectively, the unpaid principal of and interest on the
Loans and all other obligations and liabilities of the Borrower under this
Agreement and the other Loan Documents to which it is a party (including,
without limitation, interest accruing at the then applicable rate provided in
this Agreement or any other applicable Loan Document after the maturity of the
Loans and interest accruing at the then applicable rate provided in this
Agreement or any other applicable Loan Document after the filing of any petition
in bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to the Borrower, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding), whether direct or
indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in connection with, this
Agreement, the Notes, the other Loan Documents, Swap Agreements entered into
with Lenders or any other document made, delivered or given in connection
therewith, in each case whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses or otherwise (including, without
limitation, all Attorney Costs of counsel to the Administrative Agent or to the
Lenders that are required to be paid by the Borrower pursuant to the terms of
this Agreement or any other Loan Document).
"PARTICIPANT": as defined in subsection 11.6(c).
"PBGC": the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA and each successor thereto.
"PERMITTED ACQUISITIONS": as defined in subsection 8.12.
"PERMITTED INVESTMENTS":
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are backed by
the full faith and credit of the United States of America), in each case
maturing within one year from the date of acquisition thereof;
(b) certificates of deposit of any Lender, certificates of deposit,
eurodollar deposits, time deposits, overnight bank deposits, bankers acceptances
and repurchase agreements of any commercial bank which has capital and surplus
in excess of $200,000,000 and having maturities of one year or less from the
date of acquisition;
(c) corporate securities, including commercial paper, rated at least
A-2 by Standard & Poor's Ratings Services, a division of the McGraw-Hill
Companies ("S&P") and P-2 by Moody's Investors Service, Inc. ("Moody's") and
corporate debt instruments including medium term notes and floating rate notes
17
issued by foreign or domestic corporations which pay in Dollars rated at least A
by S&P or Moody's;
(d) short term tax exempt securities including municipal notes,
commercial paper, auction rate floaters and floating rate notes rated at least
A-1 by S&P or P-1 by Moody's;
(e) municipal notes rated at least SP-1 by S&P or MIG-2 by Moody's,
and bonds rated at AA by S&P or Moody's;
(f) auction rate preferred stock or bonds issued with a rate set
mechanism and a maximum term of 180 days rated at least AA by Moody's;
(g) securities with maturities of one year or less from the date of
acquisition issued or fully guaranteed by any state, commonwealth or territory
of the United States, by any political subdivision or taxing authority of any
such state, commonwealth or territory or by any foreign government, the
securities of which state, commonwealth, territory, political subdivision,
taxing authority or foreign government (as the case may be) are rated at least
AA by S&P or A by Moody's;
(h) securities with maturities of one year or less from the date of
acquisition fully backed by standby letters of credit issued by any Lender or
any commercial bank satisfying the requirements of clause (b) of this
definition; and
(i) money market accounts or funds which invest primarily in the types
of securities described in (a) through (h) above.
If both S&P and Moody's cease publishing ratings of investments of any of the
types described above, then equivalent ratings of a nationally recognized rating
agency will apply.
"PERSON": an individual, partnership, corporation, business trust, limited
liability company, joint stock company, trust, unincorporated association, joint
venture, Governmental Authority or other entity of whatever nature.
"PLAN": at a particular time, any "employee pension benefit plan," as such
term is defined in Section 3(2) of ERISA and which is subject to Title IV of
ERISA and/or Section 412 of the Code, other than a Multiemployer Plan, and in
respect of which the Borrower or a Commonly Controlled Entity is (or, if such
plan were terminated at such time, would under Section 4069 of ERISA be deemed
to be) an "employer" as defined in Section 3(5) of ERISA or to which the
Borrower or a Commonly Controlled Entity contributes or has an obligation to
contribute.
"PRIME RATE": as defined in the definition of "ABR" in this subsection 1.1.
"PROPERTIES": as defined in subsection 5.10.
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"RECEIVABLES": any accounts receivable of any Person, including, without
limitation, any thereof constituting or evidenced by chattel paper, instruments
or general intangibles, and all proceeds thereof and rights (contractual and
other) and collateral related thereto.
"RECEIVABLES SUBSIDIARY": any special purpose, bankruptcy-remote Subsidiary
that purchases Receivables generated by the Borrower or any of its Subsidiaries.
"RECEIVABLES TRANSACTION": any transaction or series of transactions
providing for the financing of Receivables of the Borrower or any of its
Subsidiaries, involving one or more sales, contributions or other conveyances by
the Borrower or any of its Subsidiaries of its/their Receivables to Receivables
Subsidiaries which finance the purchase thereof by means of the incurrence of
Indebtedness or otherwise. Notwithstanding anything contained in the foregoing
to the contrary: (a) no portion of the Indebtedness (contingent or otherwise)
with respect to any Receivables Transactions shall (i) be guaranteed by the
Borrower or any of its Subsidiaries, (ii) involve recourse to the Borrower or
any of its Subsidiaries (other than the relevant Receivables Subsidiary), or
(iii) require or involve any credit support or credit enhancement from the
Borrower or any of its Subsidiaries (other than the relevant Receivables
Subsidiary), provided that the Borrower and its Subsidiaries will be permitted
to agree to representations, warranties, covenants and indemnities that are
reasonably customary in accounts receivable securitization transactions of the
type contemplated (none of which representations, warranties, covenants or
indemnities will result in recourse to the Borrower or any of its Subsidiaries
(other than the relevant Receivables Subsidiary) beyond the limited recourse
that is reasonably customary in accounts receivable securitization transactions
of the type contemplated); and (b) the securitization facility and structure
relating to such Receivables Transactions shall be on market terms and
conditions customary for Receivables transactions of the type contemplated.
"REFUNDED SWINGLINE LOANS": as defined in subsection 2.4.
"REFUNDING DATE": as defined in subsection 2.4.
"REGISTER": as defined in subsection 11.6(b).
"REIMBURSEMENT OBLIGATION": the obligation of the Borrower to reimburse the
Issuing Lender pursuant to subsection 4.5(a) for amounts drawn under Letters of
Credit.
"RELATED PARTIES": with respect to any specified Person, such Person's
Affiliates and the respective directors, officers, employees, and agents of such
Person or such Person's Affiliates.
"REORGANIZATION": with respect to any Multiemployer Plan, the condition
that such plan is in reorganization within the meaning of Section 4241 of ERISA.
"REPORTABLE EVENT": any of the events set forth in Section 4043(c) of
ERISA, other than those events as to which the thirty day notice period is
waived under PBGC Reg.ss. 4043 or otherwise.
19
"REQUIREMENT OF LAW": as to any Person, the certificate of incorporation
and by-laws or other organizational or governing documents of such Person, and
any law, treaty, rule or regulation or determination of an arbitrator or a court
or other Governmental Authority, in each case applicable to or binding upon such
Person or any of its property or to which such Person or any of its property is
subject.
"RESPONSIBLE OFFICER": with respect to any Person, the chief executive
officer and the president of such Person as well as, in the case of the
Borrower, the Vice President and General Counsel of the Borrower, and in the
case of any Guarantor, a duly elected Vice President of such Guarantor, or, with
respect to financial matters, the chief financial officer and the treasurer of
such Person.
"RESTRICTED PAYMENT": any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests or other
equity interest of the Borrower or any Subsidiary, or any payment (whether in
cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any such Equity Interests or other equity
interest or of any option, warrant or other right to acquire any such Equity
Interests or other equity interest.
"REVOLVING CREDIT COMMITMENT": as to any Lender, the obligation of such
Lender to make Revolving Credit Loans to the Borrower and to acquire
participations in Letters of Credit and Swingline Loans hereunder in an
aggregate principal amount at any one time outstanding not to exceed the amount
set forth opposite such Lender's name on SCHEDULE I under the heading "REVOLVING
CREDIT COMMITMENT," as such amount may be modified from time to time in
accordance with the provisions of this Agreement.
"REVOLVING CREDIT COMMITMENT PERCENTAGE": as to any Lender at any time, the
percentage which such Lender's Revolving Credit Commitment at such time
constitutes of the Aggregate Revolving Credit Commitments at such time (or, if
the Revolving Credit Commitments have terminated or expired, the percentage
which (a) the Aggregate Revolving Credit Outstandings of such Lender at such
time then constitutes of (b) the Aggregate Revolving Credit Outstandings of all
Lenders at such time).
"REVOLVING CREDIT LOANS": as defined in subsection 2.1.
"REVOLVING CREDIT NOTE": as defined in subsection 3.13(d).
"REVOLVING LENDER": each Lender that has a Revolving Credit Commitment
hereunder or that holds Revolving Credit Loans.
"SIGNIFICANT SUBSIDIARY":
(a) each domestic (i.e., incorporated or organized in the United
States or any state or territory thereof; hereinafter, "domestic") wholly-owned
Subsidiary or other entity formed or acquired by the Borrower or any direct or
indirect Subsidiary (whether existing at the date hereof, or formed or acquired
20
after the date hereof), if such Subsidiary or entity, after giving effect to the
formation/acquisition of the same, has total assets that exceed five percent of
the domestic "Consolidated Total Assets," valued as of the occurrence/closing of
such formation/acquisition or as of the last day of any fiscal year thereafter;
and
(b) each domestic Subsidiary or entity (whether existing at the date
hereof, or formed or acquired after the date hereof) in which the Borrower or
any Guarantor has, directly or indirectly, a 66.67% or greater but less than
100% ownership interest which becomes or is a Subsidiary if such Subsidiary or
entity, after giving effect to the formation/acquisition of the same, has total
assets that exceed five percent of the domestic "Consolidated Total Assets,"
valued as of the occurrence/closing of such formation/acquisition or as of the
last day of any fiscal year thereafter.
"SIGNING DATE": the date on which the Lenders have signed this Agreement.
"SINGLE EMPLOYER PLAN": any Plan which is covered by Title IV of ERISA, but
which is not a Multiemployer Plan.
"SOLE BOOKRUNNER": as defined in the preamble hereto.
"SPOT RATE": for a currency means the rate quoted by JPMCB as the spot rate
for the purchase by JPMCB of such currency with another currency through its
principal foreign exchange trading office at approximately 11:00 a.m., New York
time, on the date two Business Days prior to the date on which the foreign
exchange transaction is made.
"SUBSIDIARY": as to any Person ("parent"), a corporation, partnership or
other entity (a) the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, or (b) of
which shares of stock or other ownership interests having ordinary voting power
(other than stock or such other ownership interests having such power only by
reason of the happening of a contingency) to elect a majority of the board of
directors or other managers of such corporation, partnership or other entity are
at the time owned, or the management of which is otherwise controlled, directly
or indirectly through one or more intermediaries, or both, by such Person.
Unless otherwise qualified, all references to a "Subsidiary" or to
"Subsidiaries" in this Agreement shall refer to a direct or indirect Subsidiary
or Subsidiaries of the Borrower.
"SUBSIDIARY STOCK": with respect to any Person, the Equity Interests of any
Subsidiary of such Person.
"SWAP AGREEMENT": any agreement with respect to any swap, forward, future
or derivative transaction or option or similar agreement involving, or settled
by reference to, one or more rates, currencies, commodities, equity or debt
instruments or securities, or economic, financial or pricing indices or measures
of economic, financial or pricing risk or value or any similar transaction or
any combination of these transactions; PROVIDED that no phantom stock or similar
plan providing for payments only on account of services provided by current or
21
former directors, officers, employees or consultants of the Borrower or any of
its Subsidiaries shall be a Swap Agreement.
"SWINGLINE COMMITMENT": the obligation of the Swingline Lender to make
Swingline Loans pursuant to subsection 2.3 in an aggregate principal amount at
any one time outstanding not to exceed $15,000,000.
"SWINGLINE LENDER": JPMCB, in its capacity as the lender of Swingline
Loans.
"SWINGLINE LOANS": as defined in subsection 2.3.
"SWINGLINE NOTE": as defined in subsection 3.13(e).
"SWINGLINE PARTICIPATION AMOUNT": as defined in subsection 2.4(c).
"SWISS FRANCS": the lawful currency of Switzerland.
"SYNDICATION AGENT": as defined in the preamble hereto.
"TARGET OPERATING DAY": any day that is not (a) a Saturday or Sunday, (b)
Christmas Day or New Year's Day or (c) any other day on which the Trans-European
Real-time Gross Settlement Operating System (or any successor settlement system)
is not operating (as determined in good faith by the Administrative Agent).
"TERMINATION DATE": (a) May 2, 2006, or (b) such earlier date upon which
the Aggregate Revolving Credit Commitments may be terminated in accordance with
the terms hereof.
"TRANSFEREE": as defined in subsection 11.6(e).
"TYPE": as to any Revolving Credit Loan, its nature as an ABR Loan or a
LIBOR Loan.
"UTILIZATION FEE RATE": .125% per annum.
1.2 OTHER DEFINITIONAL PROVISIONS
-----------------------------
(a) Unless otherwise specified therein, all terms defined in this
Agreement shall have the defined meanings when used in any Notes or any other
Loan Documents delivered pursuant hereto.
(b) As used herein or in any of the other Loan Documents, accounting
terms relating to the Borrower and its Subsidiaries not defined in subsection
1.1, and accounting terms partly defined in subsection 1.1, but only to the
extent not so defined, shall have the respective meanings given to them under
GAAP. If at any time any change in GAAP or in the manner in which the Borrower
shall be required or permitted to disclose its financial results in its filings
with the Securities and Exchange Commission (i.e., a change which is
inconsistent with the manner disclosed by the Borrower in its Annual Report on
Form 10-K for the fiscal year ended December 29, 2001) would affect the
22
computation of any financial ratio or requirement set forth in any Loan
Document, and either the Borrower or the Majority Lenders shall so request, the
Administrative Agent, the Lenders and the Borrower shall negotiate in good faith
to amend such ratio or requirement to preserve the original intent thereof in
light of such change (subject to the approval of the Majority Lenders); provided
that, until so amended, (i) such ratio or requirement shall continue to be
computed in accordance with GAAP and as calculated consistent with the manner
disclosed by the Borrower in its Annual Report on Form 10-K for the fiscal year
ended December 29, 2001 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.
(c) The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and Section, subsection,
Schedule and Exhibit references are to this Agreement unless otherwise
specified. In the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including;" the words "to"
and "until" each mean "to but excluding;" and the word "through" means "to and
including." Each reference to "basis points" or "bps" shall be interpreted in
accordance with the convention that 100 bps = 1.0%.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
1.3 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).
1.4 REFERENCES TO AGREEMENTS AND LAWS
---------------------------------
Unless otherwise expressly provided herein, (a) references to
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.
Section 2. AMOUNT AND TERMS OF COMMITMENTS
2.1 REVOLVING CREDIT COMMITMENTS
----------------------------
23
(a) Subject to the terms and conditions hereof, each Lender severally
agrees to make revolving credit loans ("REVOLVING CREDIT LOANS") in Dollars or
in any Available Foreign Currency to the Borrower from time to time during the
Commitment Period so long as after giving effect thereto (i) the Available
Revolving Credit Commitment of each Lender is greater than or equal to zero,
(ii) the Aggregate Revolving Credit Outstandings of all Lenders do not exceed
the Aggregate Revolving Credit Commitments and (iii) the Aggregate Multicurrency
Outstandings of all Lenders do not exceed the Aggregate Multicurrency
Commitments. All Revolving Credit Loans shall be made by the Lenders on a
pro-rata basis in accordance with their respective Revolving Credit Commitment
Percentages. During the Commitment Period, the Borrower may use the Revolving
Credit Commitments by borrowing, prepaying the Revolving Credit Loans in whole
or in part, and reborrowing, all in accordance with the terms and conditions
hereof. Any Lender may cause its Multicurrency Loans to be made by any branch,
affiliate or international banking facility of such Lender, PROVIDED, that such
Lender shall remain responsible for all of its obligations hereunder and no
additional taxes, costs or other burdens shall be imposed upon the Borrower or
the Administrative Agent as a result thereof.
(b) The Revolving Credit Loans may from time to time be (i) LIBOR
Loans, (ii) ABR Loans or (iii) a combination thereof, as determined by the
Borrower and notified to the Administrative Agent in accordance with subsections
2.2 and 3.2, PROVIDED that (x) each Multicurrency Loan shall be a LIBOR Loan and
(y) no Revolving Credit Loan shall be made as a LIBOR Loan after the day that is
one month prior to the Termination Date.
2.2 PROCEDURE FOR REVOLVING CREDIT BORROWING
----------------------------------------
(a) The Borrower may request a Revolving Credit Loan during the
Commitment Period on any Business Day, PROVIDED that the Borrower shall give the
Administrative Agent irrevocable notice prior to 10:00 A.M., New York City time,
(a) three Business Days prior to the requested Borrowing Date, if all or any
part of the requested Revolving Credit Loans are to be LIBOR Loans in Dollars,
(b) four Business Days prior to the requested Borrowing Date, if all or any part
of the requested Revolving Credit Loans are to be LIBOR Loans in Available
Foreign Currencies, or (c) on the requested Borrowing Date, with respect to ABR
Loans. Each such borrowing request may be given by telephone or by delivery of a
written borrowing request. Any such written borrowing request shall be
substantially in the form of EXHIBIT A, duly completed and executed by the
Borrower. Any such telephonic borrowing request shall be confirmed promptly by
hand delivery or telecopy to the Administrative Agent of a written borrowing
request which shall be substantially in the form of EXHIBIT A, duly completed
and executed by the Borrower.
(b) Each Borrowing request shall specify (i) the amount to be
borrowed, (ii) the requested Borrowing Date, (iii) whether the borrowing is to
be comprised of LIBOR Loans, ABR Loans or a combination thereof, (iv) if the
borrowing is to be entirely or partly comprised of LIBOR Loans, the amount of
such LIBOR Loan and the length of the initial Interest Period therefor, and (v)
if the borrowing is to be entirely or partly comprised of Multicurrency Loans,
the requested Available Foreign Currency and the amount of such borrowing.
24
(c) Each borrowing under the Revolving Credit Commitments (other than
a borrowing under subsection 2.4 and 4.2) shall be in an amount equal to (x) in
the case of ABR Loans, $5,000,000 or a whole multiple of $1,000,000 in excess
thereof (or, if the Aggregate Available Revolving Credit Commitments are less
than $1,000,000, such lesser amount) and (y) in the case of LIBOR Loans,
$5,000,000 or a whole multiple of $1,000,000 in excess thereof. Upon receipt of
any such notice from the Borrower, the Administrative Agent shall promptly
notify each Lender thereof. Prior to 11:00 A.M. New York City time in the case
of LIBOR Loans, and prior to 12:00 Noon New York City time in the case of ABR
Loans, on the Borrowing Date requested by the Borrower in accordance with the
provisions hereof, each Lender will make an amount equal to its Funding
Commitment Percentage of the principal amount of the Revolving Credit Loans
requested to be made on such Borrowing Date available to the Administrative
Agent for the account of the Borrower at the New York office of the
Administrative Agent specified in subsection 11.2 (or such other funding office
for the relevant Available Foreign Currency which is specified from time to time
by the Administrative Agent by notice to the Borrower and the Lenders) in funds
immediately available (in the relevant Available Foreign Currency for
Multicurrency Loans), to the Administrative Agent. Such borrowing will then be
made available to the Borrower by the Administrative Agent crediting the account
of the Borrower on the books of such office with the aggregate of the amounts
made available to the Administrative Agent by the Lenders and in like funds as
received by the Administrative Agent.
2.3 SWINGLINE COMMITMENT
--------------------
Subject to the terms and conditions hereof, the Swingline Lender agrees to
make a portion of the credit otherwise available to the Borrower under the
Revolving Credit Commitments from time to time during the Commitment Period by
making swingline Loans ("SWINGLINE LOANS") in Dollars to the Borrower so long as
after giving effect thereto (i) the Aggregate Swingline Outstandings shall not
exceed the Swingline Commitment and (ii) the Aggregate Revolving Credit
Outstandings of all Lenders shall not exceed the Aggregate Revolving Credit
Commitments; PROVIDED that a Swingline Loan may not be used to refinance an
outstanding Swingline Loan. During the Commitment Period, the Borrower may use
the Swingline Commitment by borrowing, repaying and reborrowing, all in
accordance with the terms and conditions hereof. The Borrower shall repay each
Swingline Loan within thirty (30) Business Days of the Borrowing Date of such
Swingline Loan. All repayments under this Agreement on account of Swingline
Loans shall be made in Dollars in immediately available funds to the Swingline
Lender for its own account not later than 1:00 p.m. New York City time on the
date any such payment is due to the office of JPMCB specified in subsection
11.2.
2.4 PROCEDURE FOR SWINGLINE BORROWING; REFUNDING OF SWINGLINE LOANS
---------------------------------------------------------------
(a) Whenever the Borrower desires that the Swingline Lender make a
Swingline Loan, it shall give the Swingline Lender irrevocable telephonic
notice, which telephonic notice must be received by the Swingline Lender not
later than 1:00 P.M., New York City time, on the proposed Borrowing Date,
specifying (i) the amount to be borrowed and (ii) the requested Borrowing Date
(which shall be a Business Day during the Commitment Period). Each such
telephonic borrowing request shall be confirmed promptly by hand delivery or
25
telecopy to the Swingline Lender of a written borrowing request which shall be
substantially in the form of EXHIBIT B, duly completed and executed by the
Borrower. Each borrowing under the Swingline Commitment shall be in an amount
equal to $500,000 or a whole multiple of $100,000 in excess thereof. Not later
than 3:00 P.M., New York City time, on the Borrowing Date specified in a notice
in respect of Swingline Loans, the Swingline Lender shall make available to the
Administrative Agent for the account of the Borrower at the New York office of
the Administrative Agent specified in subsection 11.2 an amount in immediately
available funds equal to the amount of the Swingline Loan to be made by the
Swingline Lender. The Administrative Agent shall make the proceeds of such
Swingline Loan available to the Borrower on such Borrowing Date by depositing
such proceeds in the account of the Borrower with the Administrative Agent on
such Borrowing Date in immediately available funds. The Administrative Agent
shall give the other Lenders prompt notice of each extension by the Swingline
Lender of a Swingline Loan.
(b) The Swingline Lender, at any time and from time to time in its
sole and absolute discretion may, on behalf of the Borrower (which hereby
irrevocably directs the Swingline Lender to act on its behalf), on one Business
Day's notice given by the Swingline Lender to the Lenders (with a copy to the
Borrower) no later than 12:00 Noon, New York City time, request each Lender
(including the Swingline Lender in its capacity as a Lender having a Revolving
Credit Commitment) to make, and each Lender hereby agrees to make, an ABR Loan,
in an amount equal to such Lender's Revolving Credit Commitment Percentage of
the aggregate amount of the Swingline Loans (the "REFUNDED SWINGLINE LOANS")
outstanding on the date of such notice, to repay the Swingline Lender. Each
Lender shall make the amount of such ABR Loan available to the Administrative
Agent at the New York office of the Administrative Agent specified in subsection
11.2 in immediately available funds, not later than 10:00 A.M., New York City
time, one Business Day after the date of such notice. The proceeds of such ABR
Loans shall be immediately made available by the Administrative Agent to the
Swingline Lender for application by the Swingline Lender to the repayment of the
Refunded Swingline Loans. The Borrower irrevocably authorizes the Swingline
Lender to charge the Borrower's accounts with the Administrative Agent (up to
the amount available in each such account) in order to immediately pay the
amount of such Refunded Swingline Loans to the extent amounts received from the
Lenders are not sufficient to repay in full such Refunded Swingline Loans if
such deficiency is not otherwise reimbursed by the Borrower on the Business Day
following a written request for such reimbursement to the Borrower by the
Swingline Lender (without prejudice to any rights Borrower may have against any
such Lender which did not provide its pro rata portion to repay in full such
Refunded Swingline Loans). If such amount is not in fact made available to the
Administrative Agent by any Lender, the Swingline Lender shall be entitled to
recover such amount on demand from such Lender together with accrued interest
thereon for each day from the date such amount is required to be paid, at the
Federal Funds Effective Rate. If such Lender does not pay such amount as
provided above, and until such time as such Lender makes the required payment,
the Swingline Lender shall be deemed to continue to have outstanding Swingline
Loans in the amount of such unpaid participation obligation for all purposes of
the Loan Documents other than those provisions requiring the other Lenders to
purchase a participation therein, and all amounts paid or payable by the
Borrower on account of Swingline Loans which would otherwise comprise such
Lender's Swingline Participation Amount (had such Lender purchased and funded
its participation therein) shall continue to be for the sole account of the
26
Swingline Lender. Further, such Lender shall be deemed to have assigned any and
all payments made of principal and interest on its Revolving Credit Loans,
amounts due with respect to any Letters of Credit (or its participation
interests therein) and any other amounts due to it hereunder to the Swingline
Lender to fund ABR Loans in the amount of the participation in Swingline Loans
that such Lender failed to purchase and fund pursuant to this subsection 2.4(b),
until such amount has been purchased and funded.
(c) If, prior to the time an ABR Loan would have otherwise been made
pursuant to subsection 2.4(b), one of the events described in subsection 9(e) or
9(i) shall have occurred and be continuing with respect to the Borrower or if
for any other reason, as determined by the Swingline Lender in its sole
discretion, ABR Loans may not be made as contemplated by subsection 2.4(b), each
Lender shall, on the date such ABR Loan was to have been made pursuant to the
notice referred to in subsection 2.4(b) (the "REFUNDING DATE"), purchase for
cash an undivided participating interest in the then outstanding Swingline Loans
by paying to the Swingline Lender an amount (the "SWINGLINE PARTICIPATION
AMOUNT") equal to (i) such Lender's Revolving Credit Commitment Percentage TIMES
(ii) the sum of the aggregate principal amount of Swingline Loans then
outstanding that were to have been repaid with such ABR Loans, and upon the
purchase of any such participating interest the then outstanding Swingline Loans
shall bear interest at the rate then applicable to ABR Loans.
(d) Whenever, at any time after the Swingline Lender has received from
any Lender such Lender's Swingline Participation Amount, the Swingline Lender
receives any payment on account of the Swingline Loans, the Swingline Lender
will distribute to such Lender its Swingline Participation Amount (appropriately
adjusted, in the case of interest payments, to reflect the period of time during
which such Lender's participating interest was outstanding and funded and, in
the case of principal and interest payments, to reflect such Lender's PRO RATA
portion of such payment if such payment is not sufficient to pay the principal
of and interest on all Swingline Loans then due); PROVIDED, HOWEVER, that in the
event that such payment received by the Swingline Lender is required to be
returned, such Lender will return to the Swingline Lender any portion thereof
previously distributed to it by the Swingline Lender.
(e) Each Lender's obligation to make the Loans referred to in
subsection 2.4(b) and to purchase participating interests pursuant to subsection
2.4(c) shall be absolute and unconditional and shall not be affected by any
circumstance, including (i) any setoff, counterclaim, recoupment, defense or
other right that such Lender or the Borrower may have against the Swingline
Lender, the Borrower or any other Person for any reason whatsoever; (ii) the
occurrence or continuance of a Default or an Event of Default or the failure to
satisfy any of the other conditions specified in Section 6; (iii) any adverse
change in the condition (financial or otherwise) of the Borrower; (iv) any
breach of this Agreement or any other Loan Document by the Borrower or any other
Lender; or (v) any other circumstance, happening or event whatsoever, whether or
not similar to any of the foregoing.
2.5 FEES
----
(a) FACILITY FEE. The Borrower agrees to pay to the Administrative
Agent for the account of each Lender a facility fee for the period from and
27
including the Fee Commencement Date to the Termination Date, computed at the
Facility Fee Rate on the average daily amount of the Revolving Credit Commitment
of such Lender (regardless of usage) during the period for which payment is
made, payable quarterly in arrears on the last day of each March, June,
September and December and on the Termination Date, commencing on the first of
such dates to occur after the date hereof.
(b) UTILIZATION FEE. The Borrower agrees to pay to the Administrative
Agent for the account of each Lender a utilization fee for each Excess
Utilization Day during the period from and including the Fee Commencement Date
to the Termination Date, computed at the Utilization Fee Rate on the average
daily amount of the Aggregate Revolving Credit Outstandings of such Lender for
each Excess Utilization Day during the period for which payment is made, payable
quarterly in arrears on the last day of each March, June, September and December
and on the Termination Date, commencing on the first of such dates to occur
after the date hereof.
(c) ARRANGEMENT AND AGENCY FEES . The Borrower shall pay an
arrangement fee to the Sole Lead Arranger for the Sole Lead Arranger's own
account, and shall pay an agency fee to the Administrative Agent for the
Administrative Agent's own account, in the amounts and at the times specified in
the letter agreement, dated January 4, 2002 (the "Administrative Agent/Sole Lead
Arranger Fee Letter"), between the Borrower, the Sole Lead Arranger and the
Administrative Agent. Such fees shall be fully earned when paid and shall be
nonrefundable for any reason whatsoever.
(d) LENDERS' UPFRONT FEE. On the Closing Date, the Borrower shall pay
to the Administrative Agent, for the account of the Lenders in the amounts set
forth below, an aggregate upfront fee of $262,500. Such upfront fees are for the
credit facilities committed by the Lenders under this Agreement and are fully
earned on the date paid. The upfront fee paid to each Lender is solely for its
own account and is nonrefundable for any reason whatsoever.
---------------------------------- ----------------------
LENDER AMOUNT
---------------------------------- ----------------------
JPMorgan Chase Bank $56,250
---------------------------------- ----------------------
Fleet National Bank $56,250
---------------------------------- ----------------------
Citibank N.A. $31,250
---------------------------------- ----------------------
HSBC Bank USA $31,250
---------------------------------- ----------------------
Mellon Bank, N.A. $31,250
---------------------------------- ----------------------
The Bank of New York $31,250
---------------------------------- ----------------------
Wells Fargo Bank, National $15,000
Association
---------------------------------- ----------------------
Israel Discount Bank of New York $10,000
---------------------------------- ----------------------
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2.6 TERMINATION OR REDUCTION OF COMMITMENTS
---------------------------------------
The Borrower shall have the right, upon not less than five Business Days'
notice to the Administrative Agent, to terminate the Aggregate Revolving Credit
Commitments or, from time to time, to reduce the amount of the Aggregate
Revolving Credit Commitments; PROVIDED that no such termination or reduction
shall be permitted if, after giving effect thereto and to any prepayments of the
Loans made on the effective date thereof, either (a) the Aggregate Available
Revolving Credit Commitments would not be greater than or equal to zero or (b)
the Available Revolving Credit Commitments of any Lender would not be greater
than or equal to zero. Any such reduction shall be in an amount equal to
$5,000,000 or if greater, a whole multiple thereof, and shall reduce permanently
the Aggregate Revolving Credit Commitments then in effect. The Administrative
Agent shall give each Lender prompt notice of any notice received from the
Borrower pursuant to this subsection 2.6. Simultaneously with any such
reduction, a pro-rata reduction in the Aggregate Multicurrency Commitments and
the Swingline Commitment shall be deemed to have occurred.
2.7 INCREASE IN COMMITMENTS
-----------------------
(a) The Borrower may at any time propose that the Aggregate Revolving
Credit Commitments hereunder be increased (each such proposed increase being a
"COMMITMENT INCREASE"), by notice to the Administrative Agent specifying the
existing Lender(s) (the "INCREASING LENDER(S)") and/or the additional lenders
(the "ASSUMING LENDER(S)") that will be providing the additional Commitment(s)
and the date on which such increase is to be effective (the "COMMITMENT INCREASE
DATE"), which shall be a Business Day at least three Business Days after
delivery of such notice and prior to the Termination Date; PROVIDED that:
(i) the minimum aggregate amount of each proposed Commitment Increase
shall be (A)$10,000,000 in the case of an Assuming Lender and (B)$5,000,000
in the case of an Increasing Lender;
(ii) immediately after giving effect to such Commitment Increase, the
Aggregate Revolving Credit Commitments hereunder shall not exceed
$250,000,000;
(iii) no Event of Default shall have occurred and be continuing on
such Commitment Increase Date or shall result from the proposed Commitment
Increase; and
(iv) the representations and warranties contained in Section 5 and in
the other Loan Documents shall be true correct in all material respects on
and as of the Commitment Increase Date as if made on and as of such date
(or, if any such representation and warranty is expressly stated to have
been made as of a specific date, as of such specific date).
(b) Any Assuming Lender shall become a Lender hereunder as of such
Commitment Increase Date and the Commitment of any Increasing Lender and any
such Assuming Lender shall be increased as of such Commitment Increase Date;
PROVIDED that:
29
(i) the Administrative Agent shall have received on or prior to 9:00
a.m., New York City time, on such Commitment Increase Date a certificate of
a duly authorized officer of the Borrower stating that each of the
applicable conditions to such Commitment Increase set forth in clause (a)
of this subsection has been satisfied;
(ii) with respect to each Assuming Lender, the Administrative Agent
shall have received, on or prior to 9:00 a.m., New York City time, on such
Commitment Increase Date, an assumption agreement in substantially the form
of EXHIBIT C (an "Assumption Agreement") duly executed by such Assuming
Lender and the Borrower and acknowledged by the Administrative Agent; and
(iii) each Increasing Lender shall have delivered to the
Administrative Agent, on or prior to 9:00 a.m., New York City time, on such
Commitment Increase Date, confirmation in writing satisfactory to the
Administrative Agent as to its increased Commitment, with a copy of such
confirmation to the Borrower.
(c) Upon its receipt of confirmation from a Lender that it is
increasing its Commitment hereunder, together with the certificate referred to
in clause (b)(i) above, the Administrative Agent shall (A) record the
information contained therein in the Register and (B) give prompt notice thereof
to the Borrower; provided that absent such Lender's confirmation of such a
Commitment Increase as aforesaid, such Lender will be under no obligation to
increase its Commitment hereunder. Upon its receipt of an Assumption Agreement
executed by an Assuming Lender, together with the certificate referred to in
clause (b)(i) above, the Administrative Agent shall, if such Assumption
Agreement has been completed and is in substantially the form of EXHIBIT C, (x)
accept such Assumption Agreement, (y) record the information contained therein
in the Register and (z) give prompt notice thereof to the Borrower.
(d) In the event that the Administrative Agent shall have received
notice from the Borrower as to any agreement with respect to a Commitment
Increase on or prior to the relevant Commitment Increase Date and the actions
provided for in clause (b) above shall have occurred by 9:00 a.m., New York City
time, on such Commitment Increase Date, the Administrative Agent shall notify
the Lenders (including any Assuming Lenders) of the occurrence of such
Commitment Increase promptly on such date by facsimile transmission or
electronic messaging system. On the date of such Commitment Increase, the
Borrower shall (i) prepay the outstanding Revolving Credit Loans (if any) in
full, (ii) simultaneously borrow new Revolving Credit Loans hereunder in an
amount equal to such prepayment, so that, after giving effect thereto, the
Revolving Credit Loans are held ratably by the Lenders in accordance with the
respective Revolving Credit Commitments of such Lenders (after giving effect to
such Commitment Increase) and (iii) pay to the Lenders the amounts, if any,
payable under subsection 3.11.
2.8 REPAYMENT OF REVOLVING CREDIT LOANS
-----------------------------------
The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of each Lender (except as may be otherwise
30
provided in subsection 2.4) the then unpaid principal amount of each Revolving
Credit Loan of such Lender on the Termination Date (or such earlier date on
which the Revolving Credit Loans become due and payable pursuant to Section 9 or
otherwise). The Borrower hereby further agrees to pay interest on the unpaid
principal amount of the Revolving Credit Loans from time to time outstanding
from the date hereof until payment in full thereof at the rates per annum, and
on the dates, set forth in subsection 3.4.
Section 3. CERTAIN PROVISIONS
APPLICABLE TO THE LOANS
3.1 OPTIONAL AND MANDATORY PREPAYMENTS
----------------------------------
(a) The Borrower may at any time and from time to time prepay
outstanding Revolving Credit Loans or Swingline Loans, in whole or in part,
without premium or penalty (other than any amounts payable pursuant to
subsection 3.11 if such prepayment is of LIBOR Loans and is made on a day other
than the last day of the Interest Period with respect thereto), (i) upon at
least four Business Days' irrevocable notice to the Administrative Agent in the
case of Revolving Credit Loans and (ii) in the case of Swingline Loans,
irrevocable notice to the Administrative Agent by not later than 3:00 P.M., New
York City time, on the Business Day immediately preceding the date of
prepayment, in each case ((i) and (ii) above) specifying the date and amount of
prepayment and whether the prepayment is of LIBOR Loans, ABR Loans, a
combination thereof, if of a combination thereof, the amount allocable to each,
or of Swingline Loans. Upon receipt of any such notice the Administrative Agent
shall promptly notify each Lender thereof. If any such notice is given, the
amount specified in such notice shall be due and payable by the Borrower on the
date specified therein. Partial prepayments of Multicurrency Loans shall be in
an aggregate principal amount the Dollar Equivalent of which is at least
$5,000,000 or an integral multiple of $1,000,000 in excess thereof. Partial
prepayments of Revolving Credit Loans denominated in Dollars shall be in an
aggregate principal amount of at least $5,000,000 or an integral multiple of
$1,000,000 in excess thereof. Partial prepayments of Swingline Loans shall be in
an aggregate principal amount which is at least $100,000 or an integral multiple
of $100,000 in excess thereof.
(b) (i) If, at any time during the Commitment Period, for any reason
the Aggregate Revolving Credit Outstandings of all Lenders exceed the Aggregate
Revolving Credit Commitments then in effect, the Borrower shall, without notice
or demand, immediately prepay the Revolving Credit Loans in an amount that
equals or exceeds the amount of such excess.
(ii) If, at any time during the Commitment Period, for any reason
either the Aggregate Multicurrency Outstandings exceed the Aggregate
Multicurrency Commitments, the Aggregate Swingline Outstandings exceeds the
Aggregate Swingline Commitment or the L/C Obligations exceed the L/C Commitment,
the Borrower shall, without notice or demand, immediately prepay the
Multicurrency Loans and/or the Swingline Loans and/or cash collateralize the L/C
Obligations in accordance with the provisions of subsection 4.8, as the case may
be, in amounts such that any such excess is eliminated.
31
(iii) Each prepayment of Loans pursuant to this subsection 3.1(b)
shall be accompanied by any amounts payable under subsection 3.11 in connection
with such prepayment.
3.2 CONVERSION AND CONTINUATION OPTIONS
-----------------------------------
(a) The Borrower may elect from time to time to convert LIBOR Loans to
ABR Loans by giving the Administrative Agent at least two Business Days' prior
irrevocable notice of such election. The Borrower may elect from time to time to
convert ABR Loans to LIBOR Loans by giving the Administrative Agent at least
three Business Days' prior irrevocable notice of such election in the case of
LIBOR Loans in Dollars and at least four Business Days' prior irrevocable notice
of such election in the case of LIBOR Loans in Available Foreign Currencies. Any
such notice of conversion to LIBOR Loans shall specify the length of the initial
Interest Period therefor. Upon receipt of any such notice the Administrative
Agent shall promptly notify each Lender thereof. All or any part of outstanding
LIBOR Loans and ABR Loans may be converted as provided herein, PROVIDED that (i)
no Multicurrency Loan may be converted to an ABR Loan, (ii) no Loan may be
converted into a LIBOR Loan when any Event of Default has occurred and is
continuing and the Administrative Agent has or the Majority Lenders have
determined that such a conversion is not appropriate and (iii) no Loan may be
converted into a LIBOR Loan after the date that is one month prior to the
Termination Date.
(b) Any LIBOR Loans may be continued as such upon the expiration of
the then current Interest Period with respect thereto by the Borrower giving
notice to the Administrative Agent, in accordance with the applicable provisions
of the term "Interest Period" set forth in subsection 1.1, of the length of the
next Interest Period to be applicable to such Loans, PROVIDED that no LIBOR Loan
may, except as provided in the following proviso, be continued as such (A) when
any Event of Default has occurred and is continuing and the Administrative Agent
has or the Majority Lenders have determined that such a continuation is not
appropriate or (B) after the date that is one month prior to the Termination
Date, and PROVIDED, FURTHER, that if the Borrower shall fail to give such notice
or if such continuation is not permitted, (x) with respect to any such Loans
which are Multicurrency Loans, the Borrower shall be deemed to have specified an
Interest Period of one month and (y) all such other Loans shall be automatically
converted to ABR Loans on the last day of such then expiring Interest Period.
Upon receipt of any notice pursuant to this subsection 3.2(b), the
Administrative Agent shall promptly notify each Lender thereof.
3.3 MAXIMUM NUMBER OF TRANCHES
--------------------------
Notwithstanding anything contained herein to the contrary, after
giving effect to any Borrowing, unless consented to by the Administrative Agent
in its sole discretion, (a) there shall not be more than twelve different
Interest Periods in effect in respect of all Revolving Credit Loans at any one
time outstanding, and (b) there shall not be more than eight different
Multicurrency Loans in respect of all Revolving Credit Loans at any one time
outstanding.
3.4 INTEREST RATES AND PAYMENT DATES
--------------------------------
32
(a) Each LIBOR Loan shall bear interest for each day during each
Interest Period with respect thereto at a rate per annum equal to the Adjusted
LIBO Rate determined for such Interest Period plus the Applicable Margin in
effect for such day.
(b) Each ABR Loan shall bear interest at a rate per annum equal to the
ABR.
(c) Each Multicurrency Loan shall be a LIBOR Loan.
(d) Each Swingline Loan shall bear interest at a rate per annum
(rounded upwards, if necessary, to the next 1/100 of one percent) equal to the
sum of (a) the Federal Funds Effective Rate in effect on such day plus (b) such
margin upon which the Swingline Lender and the Borrower shall agree, upon
receipt by the Swingline Lender of a Swingline Loan request pursuant to
subsection 2.4.
(e) If all or a portion of (i) any principal of any Loan, (ii) any
interest payable thereon, (iii) any facility fee or (iv) any other amount
payable hereunder shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise), the principal of the Loans and any such overdue
interest, facility fee or other amount shall bear interest at a rate per annum
which is (x) in the case of principal, the rate that would otherwise be
applicable thereto pursuant to the foregoing provisions of this subsection plus
2% or (y) in the case of any such overdue interest, facility fee or other
amount, the rate described in paragraph (b) of this subsection plus 2%, in each
case from the date of such non-payment until such overdue principal, interest,
facility fee or other amount is paid in full (as well after as before judgment).
(f) Interest pursuant to this subsection shall be payable in arrears
on each Interest Payment Date PROVIDED that interest accruing pursuant to
paragraph (e) of this subsection shall be payable from time to time on demand.
3.5 COMPUTATION OF INTEREST AND FEES
--------------------------------
(a) Whenever (i) interest is calculated on the basis of the Prime Rate
or (ii) Multicurrency Loans are denominated in British Pounds Sterling, interest
shall be calculated on the basis of a 365 (or 366, as the case may be) day year
for the actual days elapsed; and, otherwise, interest and fees shall be
calculated on the basis of a 360-day year for the actual days elapsed. The
Administrative Agent shall as soon as practicable notify the Borrower and the
Lenders of each determination of an Adjusted LIBO Rate. Any change in the
interest rate on a Loan resulting from a change in the ABR or the Eurocurrency
Reserve Requirements, shall become effective as of the opening of business on
the day on which such change becomes effective. The Administrative Agent shall
as soon as practicable notify the Borrower and the Lenders of the effective date
and the amount of each such change in interest rate.
(b) Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Agreement shall be conclusive and binding on
the Borrower and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrower, deliver to the
Borrower a statement showing the quotations used by the Administrative Agent in
determining any interest rate pursuant to subsection 3.4(a), (b) or (c).
33
3.6 INABILITY TO DETERMINE INTEREST RATE
------------------------------------
If prior to the first day of any Interest Period:
(a) the Administrative Agent shall have determined in good faith
(which determination shall be conclusive and binding upon the Borrower) that, by
reason of circumstances affecting the relevant market, adequate and reasonable
means do not exist for ascertaining the Adjusted LIBO Rate for such Interest
Period, or
(b) the Administrative Agent shall have received notice from the
Majority Lenders that the Adjusted LIBO Rate determined or to be determined for
such Interest Period will not adequately and fairly reflect the cost to such
Lenders (as given in good faith and conclusively certified by such Lenders) of
making or maintaining their affected Loans during such Interest Period, the
Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the Lenders as soon as practicable thereafter. If such notice is
given, (w) any LIBOR Loans (excluding Multicurrency Loans) requested to be made
on the first day of such Interest Period shall be made as ABR Loans, PROVIDED,
that, notwithstanding the provisions of subsection 2.2, the Borrower may cancel
the request for such LIBOR Loan (including Multicurrency Loans) by written
notice to the Administrative Agent one Business Day prior to the first day of
such Interest Period and the Borrower shall not be subject to any liability
pursuant to subsection 3.11 with respect to such cancelled request, (x) any
Loans that were to have been converted on the first day of such Interest Period
to LIBOR Loans (excluding Multicurrency Loans) shall be continued as ABR Loans,
and (y) any outstanding LIBOR Loans (excluding Multicurrency Loans) shall be
converted, on the first day of such Interest Period, to ABR Loans, and (z) any
Multicurrency Loans to which such Interest Period relates shall be repaid on the
first day of such Interest Period. Until such notice has been withdrawn by the
Administrative Agent, no further LIBOR Loans shall be made or continued as such,
nor shall the Borrower have the right to convert ABR Loans to LIBOR Loans.
3.7 PRO RATA TREATMENT AND PAYMENTS
-------------------------------
(a) Except to the extent provided elsewhere in this Agreement to the
contrary, each payment of principal or interest in respect of the Loans shall be
made PRO RATA according to the amounts then due and owing to the respective
Lenders.
(b) Each Borrowing by the Borrower of Revolving Credit Loans from the
Lenders hereunder shall be made PRO RATA according to the Funding Commitment
Percentages of the Lenders in effect on the date of such Borrowing. Each payment
by the Borrower on account of any facility fee hereunder and any reduction of
the Revolving Credit Commitments of the Lenders shall be allocated by the
Administrative Agent among the Lenders PRO RATA according to the Revolving
Credit Commitment Percentages of the Lenders. Each payment (including each
prepayment) by the Borrower on account of principal of and interest on the
Revolving Credit Loans shall be made pro rata according to the respective
outstanding principal amounts of the Revolving Credit Loans then due and owing
to the Lenders. All payments (including prepayments) to be made by the Borrower
hereunder in respect of amounts denominated in Dollars, whether on account of
principal, interest, fees or otherwise, shall be made without set off or
34
counterclaim and shall be made prior to 12:00 Noon, New York City time, on the
due date thereof to the Administrative Agent, for the account of the Lenders, at
the Administrative Agent's office specified in subsection 11.2, in Dollars and
in immediately available funds. All payments (including prepayments) to be made
by the Borrower hereunder with respect to principal and interest on
Multicurrency Loans shall be made without set off or counterclaim and shall be
made prior to 12:00 Noon, New York City time, on the due date thereof, to the
Administrative Agent, for the account of the Lenders, at the Administrative
Agent's office specified in subsection 11.2, in the Available Foreign Currency
with respect to which such Multicurrency Loan is denominated and in immediately
available funds. The Administrative Agent shall distribute such payments to the
Lenders promptly upon receipt in like funds as received. If any payment
hereunder (other than payments on the LIBOR Loans) becomes due and payable on a
day other than a Business Day, such payment shall be extended to the next
succeeding Business Day, and, with respect to payments of principal, interest
thereon shall be payable at the then applicable rate during such extension. If
any payment on a LIBOR Loan becomes due and payable on a day other than a
Business Day, the maturity of such payment shall be extended to the next
succeeding Business Day (and, with respect to payments of principal, interest
thereon shall be payable at the then applicable rate during such extension)
unless the result of such extension would be to extend such payment into another
calendar month, in which event such payment shall be made on the immediately
preceding Business Day.
(c) Unless the Administrative Agent shall have been notified in
writing by any Lender prior to a borrowing that such Lender will not make the
amount that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is not made available to the Administrative
Agent by the required time on the Borrowing Date therefor, such Lender shall pay
to the Administrative Agent, on demand, such amount with interest thereon at a
rate equal to (i) the daily average Federal Funds Effective Rate (in the case of
a borrowing of Revolving Credit Loans denominated in Dollars) and (ii) the
greater of (A) the daily average Federal Funds Effective Rate or (B) the
Administrative Agent's reasonable estimate of its average daily cost of funds
(in the case of a borrowing of Multicurrency Loans), in each case for the period
until such Lender makes such amount immediately available to the Administrative
Agent. A certificate of the Administrative Agent submitted to any Lender with
respect to any amounts owing under this subsection shall be conclusive in the
absence of manifest error. If such Lender's share of such borrowing is not made
available to the Administrative Agent by such Lender within three Business Days
of such Borrowing Date, the Administrative Agent shall also be entitled to
recover such amount with interest thereon equal to (x) the rate per annum
applicable to ABR Loans hereunder (in the case of a borrowing of Revolving
Credit Loans denominated in Dollars) and (y) the greater of (1) the rate per
annum applicable to ABR Loans hereunder or (2) the Administrative Agent's
reasonable estimate of its average daily cost of funds PLUS the Applicable
Margin applicable to Multicurrency Loans (in the case of a borrowing of
Multicurrency Loans), on demand, from the Borrower (without prejudice to any
rights Borrower may have against any such Lender).
3.8 ILLEGALITY
----------
35
Notwithstanding any other provision herein, if any Lender determines that
the adoption of or any change in any Requirement of Law or any change in the
interpretation or application thereof after the date hereof shall make it
unlawful for such Lender to make or maintain LIBOR Loans or Multicurrency Loans
as contemplated by this Agreement, then, on notice thereof by such Lender to the
Borrower through the Administrative Agent, (a) the commitment of such Lender
hereunder to make LIBOR Loans or Multicurrency Loans, continue LIBOR Loans or
Multicurrency Loans as such and convert ABR Loans to LIBOR Loans shall forthwith
be suspended until such Lender notifies the Administrative Agent and the
Borrower that the circumstances giving rise to such determination no longer
exists, (b) such Lender's Loans then outstanding as LIBOR Loans (excluding
Multicurrency Loans), if any, shall be converted automatically to ABR Loans on
the respective last days of the then current Interest Periods with respect to
such Loans or within such earlier period as required by law and (c) such
Lender's Multicurrency Loans shall be prepaid on the last day of the then
current Interest Period with respect thereto or within such earlier period as
required by law. If any such conversion or prepayment of a LIBOR Loan occurs on
a day which is not the last day of the then current Interest Period with respect
thereto, the Borrower shall pay to such Lender such amounts, if any, as may be
required pursuant to subsection 3.11.
3.9 REQUIREMENTS OF LAW
-------------------
(a) If the adoption of or any change in any Requirement of Law or any
change in the interpretation or application thereof or compliance by any Lender
with any request or directive (whether or not having the force of law) from any
central bank or other Governmental Authority made subsequent to the date hereof:
(i) shall subject any Lender to any tax of any kind whatsoever
with respect to this Agreement, any Note, any Letter of Credit, any
Application, any LIBOR Loan, or any Multicurrency Loan made by it, or
change the basis of taxation of payments to such Lender in respect
thereof (except for Non-Excluded Taxes covered by subsection 3.10 and
changes in the rate of tax on the overall net income or franchise
taxes (in lieu of net income taxes) of such Lender imposed by the
jurisdiction where such Lender's principal or lending office is
located);
(ii) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held
by, deposits or other liabilities in or for the account of, advances,
loans or other extensions of credit by, or any other acquisition of
funds by, any office of such Lender which is not otherwise included in
the determination of the Adjusted LIBO Rate; or
(iii) shall impose on such Lender any other condition;
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining LIBOR Loans or Multicurrency Loans, or issuing or
participating in Letters of Credit or to reduce any amount receivable hereunder
in respect thereof, then, in any such case, the Borrower shall promptly pay such
36
Lender such additional amount or amounts as will compensate such Lender for such
increased cost or reduced amount receivable.
(b) If any Lender shall have determined that after the date hereof the
adoption of or any change in any Requirement of Law regarding capital adequacy
or any change in the interpretation or application thereof or compliance by such
Lender or any corporation controlling such Lender with any request or directive
regarding capital adequacy (whether or not having the force of law) from any
Governmental Authority made subsequent to the date hereof shall have the effect
of reducing the rate of return on such Lender's or such corporation's capital as
a consequence of its obligations hereunder or under any Letter of Credit to a
level below that which such Lender or such corporation could have achieved but
for such adoption, change or compliance (taking into consideration such Lender's
or such corporation's policies with respect to capital adequacy) by an amount
deemed by such Lender to be material, then from time to time, the Borrower shall
promptly pay to such Lender such additional amount or amounts as will compensate
such Lender or such corporation for such reduction.
(c) If any Lender becomes entitled to claim any additional amounts
pursuant to this subsection, it shall notify the Borrower (with a copy to the
Administrative Agent) of the event by reason of which it has become so entitled;
provided that if such Lender fails to notify the Borrower that such Lender
intends to claim any such reimbursement or compensation within 120 days after
such Lender has knowledge of its claim therefor, the Borrower shall not be
obligated to compensate such Lender for the amount of such Lender's claim
accruing prior to the date which is 120 days before the date on which such
Lender first notifies the Borrower that it intends to make such claim; it being
understood that the calculation of the actual amounts may not be practicable
within such period and such Lender may provide such calculation as soon as
reasonably practicable thereafter without affecting or limiting the Borrower's
payment obligations hereunder. A certificate as to any additional amounts
payable pursuant to this subsection submitted by such Lender to the Borrower
(with a copy to the Administrative Agent) shall be conclusive in the absence of
manifest error. The agreements in this subsection shall survive the termination
of this Agreement and each other Loan Document and the payment of the Loans and
all other amounts payable hereunder and thereunder.
3.10 TAXES
-----
(a) All payments made by the Borrower under any Loan Document shall be
made free and clear of, and without deduction or withholding for or on account
of, any present or future income, stamp or other taxes, levies, imposts, duties,
charges, fees, deductions or withholdings, now or hereafter imposed, levied,
collected, withheld or assessed by any Governmental Authority, excluding net
income taxes and franchise taxes (imposed in lieu of net income taxes) imposed
on the Administrative Agent or any Lender 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 or such Lender having executed, delivered
or performed its obligations or received a payment under, or enforced, any Loan
Document). If any such non-excluded taxes, levies, imposts, duties, charges,
fees, deductions or withholdings ("NON-EXCLUDED TAXES") are required to be
37
withheld from any amounts payable to the Administrative Agent or any Lender
hereunder or under any other Loan Document, the amounts so payable to the
Administrative Agent or such Lender shall be increased to the extent necessary
to yield to the Administrative Agent or such Lender (after payment of all
Non-Excluded Taxes) interest or any such other amounts payable hereunder at the
rates or in the amounts specified in such Loan Document, PROVIDED, however, that
the Borrower shall not be required to increase any such amounts payable to any
Lender that is not organized under the laws of the United States of America or a
state thereof if such Lender fails to comply with the requirements of paragraph
(b) of this subsection. Whenever any Non-Excluded Taxes are payable by the
Borrower, as promptly as possible thereafter the Borrower shall send to the
Administrative Agent for its own account or for the account of such Lender, as
the case may be, a certified copy of an original official receipt received by
the Borrower showing payment thereof. If the Borrower fails to pay any
Non-Excluded Taxes when due to the appropriate taxing authority or fails to
remit to the Administrative Agent the required receipts or other required
documentary evidence, the Borrower shall indemnify the Administrative Agent and
the Lenders for any incremental taxes, interest or penalties that may become
payable by the Administrative Agent or any Lender as a result of any such
failure. The agreements in this subsection shall survive the termination of this
Agreement and each other Loan Document and the payment of the Loans and all
other amounts payable hereunder and thereunder.
(b) Each Lender (or Transferee) that is not a citizen or resident of
the United States of America, a corporation, partnership or other entity created
or organized in or under the laws of the United States of America (or any
jurisdiction thereof), or any estate or trust that is subject to federal income
taxation regardless of the source of its income (a "NON-U.S. LENDER") shall
deliver to the Borrower and the Administrative Agent (or, in the case of a
Participant, to the Lender from which the related participation shall have been
purchased) two copies of either U.S. Internal Revenue Service Form W-8BEN or
Form W-8ECI, or, in the case of a Non-U.S. Lender claiming exemption from U.S.
federal withholding tax under Section 871(h) or 881(c) of the Code with respect
to payments of "portfolio interest" a statement substantially in the form of
EXHIBIT D and a Form W-8BEN, or any subsequent versions thereof or successors
thereto properly completed and duly executed by such Non-U.S. Lender claiming
complete exemption from, or a reduced rate of, U.S. federal withholding tax on
all payments by the Borrower under this Agreement and the other Loan Documents.
Such forms shall be delivered by each Non-U.S. Lender on or before the date it
becomes a party to any Loan Document (or, in the case of any Participant, on or
before the date such Participant purchases the related participation). In
addition, each Non-U.S. Lender shall deliver such forms promptly upon the
obsolescence or invalidity of any form previously delivered by such Non-U.S.
Lender. Each Non-U.S. Lender shall promptly notify the Borrower at any time it
determines that it is no longer in a position to provide any previously
delivered certificate to the Borrower (or any other form of certification
adopted by the U.S. taxing authorities for such purpose). Notwithstanding any
other provision of this paragraph, a Non-U.S. Lender shall not be required to
deliver any form pursuant to this paragraph that such Non-U.S. Lender is not
legally able to deliver.
(c) A Lender that is entitled to an exemption from or reduction of
non-U.S. withholding tax under the law of the jurisdiction in which the Borrower
is located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law or
38
reasonably requested by the Borrower, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to be
made without withholding or at a reduced rate, PROVIDED that such Lender is
legally entitled to complete, execute and deliver such documentation and in such
Lender's reasonable judgment such completion, execution or submission would not
materially prejudice the legal position of such Lender.
3.11 BREAK FUNDING PAYMENTS
----------------------
The Borrower agrees to indemnify each Lender and to hold each Lender
harmless from any loss or expense which such Lender may sustain or incur as a
consequence of (a) default by the Borrower in making a borrowing of, conversion
into or continuation of LIBOR Loans, after the Borrower has given a notice
requesting the same in accordance with the provisions of this Agreement, (b)
default by the Borrower in making any prepayment after the Borrower has given a
notice thereof in accordance with the provisions of this Agreement or any other
Loan Document, or (c) the making of a prepayment of LIBOR Loans, or the
conversion of LIBOR Loans to ABR Loans, on a day which is not the last day of an
Interest Period with respect thereto or (d) any assignment as a result of a
request by the Borrower pursuant to subsection 3.12 of any LIBOR Loan. Such
indemnification may include an amount equal to the excess, if any, of (i) the
amount of interest which would have accrued on the amount so prepaid or
converted, or not so borrowed, prepaid, converted or continued, for the period
from the date of such prepayment or conversion or of such failure to borrow,
prepay, convert or continue to the last day of such Interest Period (or, in the
case of a failure to borrow, convert or continue, the Interest Period that would
have commenced on the date of such failure) at the applicable rate of interest
for such Loans provided for herein over (ii) the amount of interest (as
reasonably determined by such Lender) which would have accrued to such Lender on
such amount by placing such amount on deposit for a comparable period with
leading Lenders in the interbank eurodollar market. This covenant shall survive
the termination of this Agreement and each other Loan Document and the payment
of the Loans and all other amounts payable hereunder and thereunder. A
certificate as to any additional amounts payable pursuant to this subsection
submitted by such Lender to the Borrower (with a copy to the Administrative
Agent) shall be conclusive in the absence of manifest error.
3.12 CHANGE OF LENDING OFFICE; REMOVAL OF LENDER
-------------------------------------------
Each Lender agrees that if it makes any demand for payment under
subsection 3.9 or 3.10(a), or if any adoption or change of the type described in
subsection 3.8 shall occur with respect to it, (i) it will use reasonable
efforts (consistent with its internal policy and legal and regulatory
restrictions and so long as such efforts would not be disadvantageous to it, as
determined in its sole discretion) to designate a different lending office if
the making of such a designation would reduce or obviate the need for the
Borrower to make payments under subsection 3.9 or 3.10(a), or would eliminate or
reduce the effect of any adoption or change described in subsection 3.8 or (ii)
it will, upon at least five Business Days' notice from the Borrower to such
Lender and the Administrative Agent, assign, pursuant to and in accordance with
the provisions of subsection 11.6, to one or more Assignees designated by the
Borrower all, but not less than all, of such Lender's rights and obligations
hereunder, without recourse to or warranty by, or expense to, such Lender, for a
39
purchase price equal to the outstanding principal amount of each Revolving
Credit Loan then owing to such Lender PLUS any accrued but unpaid interest
thereon and any accrued but unpaid facility fees and utilization fees owing
thereto and, in addition, all additional costs and reimbursements, expense
reimbursements and indemnities, if any, owing in respect of such Lender's
Commitment hereunder at such time (including any amount that would be payable
under subsection 3.11 if such assignment were, instead, a prepayment in full of
all amounts owing to such Lender and also including all amounts then payable to
such Lender pursuant to subsections 3.9 and/or 3.10) shall be paid to such
Lender.
3.13 EVIDENCE OF DEBT
----------------
(a) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing indebtedness of the Borrower to such Lender
resulting from each Loan of such Lender from time to time, including the amounts
of principal and interest payable and paid to such Lender from time to time
under this Agreement.
(b) The Administrative Agent shall maintain the Register pursuant to
subsection 11.6(b), and a subaccount therein for each Lender, in which shall be
recorded (i) in the case of Revolving Credit Loans and Swingline Loans, the
amount of each Revolving Credit Loan or Swingline Loan made hereunder, the Type
thereof and each Interest Period applicable thereto, (ii) in the case of
Multicurrency Loans, the amount and currency of each Multicurrency Loans and
each Interest Period applicable thereto, (iii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to each
Lender hereunder and (iv) both the amount of any sum received by the
Administrative Agent hereunder from the Borrower and each Lender's share
thereof.
(c) The entries made in the Register and the accounts of each Lender
maintained pursuant to subsection 3.13(a) shall, to the extent permitted by
applicable law, be PRIMA FACIE evidence of the existence and amounts of the
obligations of the Borrower therein recorded; PROVIDED, HOWEVER, that the
failure of any Lender or the Administrative Agent to maintain the Register or
any such account, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay (with applicable interest) the Loans made to
such Borrower by such Lender in accordance with the terms of this Agreement.
(d) The Borrower agrees that, upon the request to the Administrative
Agent by any Lender, the Borrower will execute and deliver to such Lender a
promissory note of the Borrower evidencing the Revolving Credit Loans of such
Lender, substantially in the form of EXHIBIT E with appropriate insertions as to
date and principal amount (a "REVOLVING CREDIT NOTE").
(e) The Borrower agrees that, upon the request of the Swingline
Lender, the Borrower will execute and deliver to such Lender a promissory note
of the Borrower evidencing the Swingline Loans of such Lender, substantially in
the form of EXHIBIT F with appropriate insertions (a "SWINGLINE NOTE").
40
Section 4. LETTERS OF CREDIT
4.1 L/C COMMITMENT
--------------
(a) Subject to the terms and conditions hereof, the Issuing Lender, in
reliance on the agreements of the other Lenders set forth in subsection 4.4(a),
agrees to issue standby letters of credit ("LETTERS OF CREDIT") for the account
of the Borrower on any Business Day during the Commitment Period in such form as
may be approved from time to time by the Issuing Lender; PROVIDED that the
Issuing Lender shall have no obligation to issue any Letter of Credit if, after
giving effect to such issuance, (i) the L/C Obligations would exceed the L/C
Commitment or (ii) the Aggregate Revolving Credit Outstandings would exceed the
Aggregate Revolving Credit Commitments. Each Letter of Credit shall (i) be
denominated in Dollars and (ii) expire no later than the date that is one
Business Day prior to the Termination Date. The Existing Letters of Credit will
be deemed Letters of Credit for all purposes hereunder.
(b) The Issuing Lender shall not at any time be obligated to issue any
Letter of Credit if such issuance would conflict with, or cause the Issuing
Lender or any L/C Participant to exceed any limits imposed by, any applicable
Requirement of Law.
4.2 PROCEDURE FOR ISSUANCE OF LETTER OF CREDIT
------------------------------------------
The Borrower may from time to time request that the Issuing Lender
issue a Letter of Credit by delivering to the Issuing Lender at its address for
notices specified herein an Application therefor, completed to the satisfaction
of the Issuing Lender, and such other certificates, documents and other papers
and information as the Issuing Lender may reasonably request. Upon receipt of
any Application, the Issuing Lender will process such Application and the
certificates, documents and other papers and information delivered to it in
connection therewith in accordance with its customary procedures, provided that
if the Borrower furnishes to the Issuing Lender all of the foregoing
documentation by no later than 12:00 P.M. on the day which is at least two
Business Days prior to the proposed date of issuance, such issuance shall occur
by no later than 5:00 P.M. on the proposed date of issuance. The Issuing Lender
shall furnish a copy of such Letter of Credit to the Borrower promptly following
the issuance thereof and shall deliver the original thereof in accordance with
the relevant Application. The Issuing Lender shall promptly furnish to the
Administrative Agent, which shall in turn promptly furnish to the Lenders,
notice of the issuance of each Letter of Credit (including the amount thereof).
4.3 FEES AND OTHER CHARGES
----------------------
(a) The Borrower will pay a fee on all outstanding Letters of Credit
at a per annum rate equal to the Applicable Margin in effect from time to time
with respect to LIBOR Loans, shared ratably among the Revolving Lenders and
payable quarterly in arrears on each L/C Fee Payment Date after the issuance
date (it being understood that with respect to the Existing Letters of Credit,
the issuance date shall be deemed to be the Closing Date). In addition, the
Borrower shall pay to the Issuing Lender for its own account a fronting fee of
0.125% per annum on the undrawn and unexpired amount of each Letter of Credit,
41
payable quarterly in arrears on each L/C Fee Payment Date after the issuance
date (it being understood that with respect to the Existing Letters of Credit,
the issuance date shall be deemed to be the Closing Date).
(b) In addition to the foregoing fees, the Borrower shall pay or
reimburse the Issuing Lender for such normal and customary costs and expenses as
are incurred or charged by the Issuing Lender in issuing, negotiating, effecting
payment under, amending or otherwise administering any Letter of Credit.
4.4 L/C PARTICIPATIONS
------------------
(a) The Issuing Lender irrevocably agrees to grant and hereby grants
to each L/C Participant, and, to induce the Issuing Lender to issue Letters of
Credit, each L/C Participant irrevocably agrees to accept and purchase and
hereby accepts and purchases from the Issuing Lender, on the terms and
conditions set forth below, for such L/C Participant's own account and risk an
undivided interest equal to such L/C Participant's Revolving Credit Commitment
Percentage in the Issuing Lender's obligations and rights under and in respect
of each Letter of Credit and the amount of each draft paid by the Issuing Lender
thereunder. Each L/C Participant unconditionally and irrevocably agrees with the
Issuing Lender that, if a draft is paid under any Letter of Credit for which the
Issuing Lender is not reimbursed in full by the Borrower in accordance with the
terms of this Agreement, such L/C Participant shall pay to the Issuing Lender
upon demand at the Issuing Lender's address for notices specified herein an
amount equal to such L/C Participant's Revolving Credit Commitment Percentage of
the amount of such draft, or any part thereof, that is not so reimbursed;
provided, however, that subject to subsection 4.4(b) hereof, notwithstanding
anything in this Agreement to the contrary, in respect of each drawing under any
Letter of Credit, the maximum amount that shall be payable by any L/C
Participant, whether as a Revolving Credit Loan pursuant to subsection 4.5
and/or as a participation pursuant to this subsection 4.4(a), shall not exceed
such L/C Participant's Revolving Credit Commitment Percentage of the amount of
such draft, or any part thereof, that is not so reimbursed by the Borrower.
(b) If any amount required to be paid by any L/C Participant to the
Issuing Lender pursuant to subsection 4.4(a) in respect of any unreimbursed
portion of any payment made by the Issuing Lender under any Letter of Credit is
not paid to the Issuing Lender on the date such payment is due, but is paid to
the Issuing Lender within three Business Days after the date such payment is
due, such L/C Participant shall pay to the Issuing Lender on demand an amount
equal to the product of (i) such amount, times (ii) the daily average Federal
Funds Effective Rate during the period from and including the date such payment
is required to the date on which such payment is immediately available to the
Issuing Lender, times (iii) a fraction the numerator of which is the number of
days that elapse during such period and the denominator of which is 360. If any
such amount required to be paid by any L/C Participant pursuant to subsection
4.4(a) is not made available to the Issuing Lender by such L/C Participant
within three Business Days after the date such payment is due, the Issuing
Lender shall be entitled to recover from such L/C Participant, on demand, such
amount with interest thereon calculated from such due date at the rate per annum
applicable to ABR Loans. A certificate of the Issuing Lender submitted to any
L/C Participant with respect to any amounts owing under this subsection shall be
conclusive in the absence of manifest error. Notwithstanding anything contained
42
herein to the contrary, until a L/C Participant funds any amount required to be
paid by such L/C Participant to the Issuing Lender pursuant to subsection
4.4(a), interest allocable to or in respect of such amount shall be solely for
the account of the Issuing Lender.
(c) Whenever, at any time after the Issuing Lender has made payment
under any Letter of Credit and has received from any L/C Participant its PRO
RATA share of such payment in accordance with subsection 4.4(a), the Issuing
Lender receives any payment related to such Letter of Credit (whether directly
from the Borrower or otherwise, including proceeds of collateral applied thereto
by the Issuing Lender), or any payment of interest on account thereof, the
Issuing Lender will distribute to such L/C Participant its PRO RATA share
thereof; PROVIDED, HOWEVER, that in the event that any such payment received by
the Issuing Lender shall be required to be returned by the Issuing Lender, such
L/C Participant shall return to the Issuing Lender the portion thereof
previously distributed by the Issuing Lender to it.
4.5 REIMBURSEMENT OBLIGATION OF THE BORROWER
----------------------------------------
The Borrower agrees to reimburse the Issuing Lender on the Business
Day next succeeding the Business Day on which the Issuing Lender notifies the
Borrower of the date and amount of a draft presented under any Letter of Credit
and paid by the Issuing Lender for the amount of (a) such draft so paid and (b)
any taxes, fees, charges or other costs or expenses incurred by the Issuing
Lender in connection with such payment. Each such payment shall be made to the
Issuing Lender in Dollars and in immediately available funds. Interest shall be
payable on any such amounts from the date on which the relevant draft is paid
until payment in full at the rate set forth in (i) until the Business Day next
succeeding the date of the relevant notice, subsection 3.4(b) and (ii)
thereafter, subsection 3.4(d). Each drawing under any Letter of Credit shall
(unless an event of the type described in subsection 9(i) or in clause (i) or
(ii) of subsection 9(e) shall have occurred and be continuing with respect to
the Borrower, in which case the procedures specified in subsection 4.4 for
funding by L/C Participants shall apply) constitute a request by the Borrower to
the Administrative Agent for a borrowing pursuant to subsection 2.2 of ABR Loans
in the amount of such drawing (and the minimum borrowing amount in such
subsection shall not apply to such borrowing). The Borrowing Date with respect
to such borrowing shall be the first date on which a borrowing of Revolving
Credit Loans could be made, pursuant to subsection 2.2, if the Administrative
Agent had received a notice of such borrowing at the time the Administrative
Agent receives notice from the relevant Issuing Lender of such drawing under
such Letter of Credit.
43
4.6 OBLIGATIONS ABSOLUTE
--------------------
The Borrower's obligations under this Section 4 shall be absolute and
unconditional under any and all circumstances and irrespective of any setoff,
counterclaim or defense to payment that the Borrower may have or have had
against the Issuing Lender, any L/C Participant, any beneficiary of a Letter of
Credit or any other Person. The Borrower also agrees with the Issuing Lender and
the L/C Participants that the Issuing Lender and the L/C Participants shall not
be responsible for, and the Borrower's Reimbursement Obligations under
subsection 4.5 shall not be affected by, among other things, the validity or
genuineness of documents or of any endorsements thereon, even though such
documents shall in fact prove to be invalid, fraudulent or forged, or any
dispute between or among the Borrower and any beneficiary of any Letter of
Credit or any other party to which such Letter of Credit may be transferred or
any claims whatsoever of the Borrower against any beneficiary of such Letter of
Credit or any such transferee. The Issuing Lender and the L/C Participants shall
not be liable for, and the Borrower's Reimbursement Obligations under subsection
4.5 shall not be affected by, any error, omission, interruption or delay in
transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Letter of Credit, except for errors or
omissions found by a final and nonappealable decision of a court of competent
jurisdiction to have resulted from the gross negligence or willful misconduct of
the Issuing Lender. The Borrower agrees that any action taken or omitted by the
Issuing Lender under or in connection with any Letter of Credit or the related
drafts or documents, if done in the absence of gross negligence or willful
misconduct and in accordance with the standards of care specified in the Uniform
Commercial Code of the State of New York, shall be binding on the Borrower and
shall not result in any liability of the Issuing Lender or any L/C Participant
to the Borrower.
4.7 LETTER OF CREDIT PAYMENTS
-------------------------
If any draft shall be presented for payment under any Letter of
Credit, the Issuing Lender shall promptly notify the Borrower of the date and
amount thereof. The responsibility of the Issuing Lender to the Borrower in
connection with any draft presented for payment under any Letter of Credit
shall, in addition to any payment obligation expressly provided for in such
Letter of Credit, be limited to determining that the documents (including each
draft) delivered under such Letter of Credit in connection with such presentment
are substantially in conformity with such Letter of Credit.
4.8 CASH COLLATERALIZATION
----------------------
If an Event of Default shall occur and be continuing and the Borrower
receives notice from the Administrative Agent or the Majority Lenders demanding
the deposit of cash collateral pursuant to this paragraph, the Borrower shall
immediately deposit into an account established and maintained on the books and
records of the Administrative Agent, which account may be a "securities account"
(within the meaning of Section 8-501 of the Uniform Commercial Code as in effect
in the State of New York), in the name of the Administrative Agent and for the
benefit of the Lenders, an amount in cash equal to the L/C Obligations as of
such date PLUS any accrued and unpaid interest thereon; PROVIDED that the
obligation to deposit such cash collateral shall become effective immediately,
and such deposit shall become immediately due and payable, without demand or
44
other notice of any kind, upon the occurrence of any Event of Default with
respect to the Borrower described in paragraph (e) or (i) of Section 9. Such
deposit shall be held by the Administrative Agent as collateral for the L/C
Obligations under this Agreement, and for this purpose the Borrower hereby
grants a security interest to the Administrative Agent for the benefit of the
Lenders in such collateral account and in any financial assets (as defined in
the Uniform Commercial Code as in effect in the State of New York) or other
property held therein. The Administrative Agent shall have exclusive dominion
and control, including the exclusive right of withdrawal, over such account.
Other than any interest earned on the investment of such deposits, which
investments shall be made at the option and sole discretion of the
Administrative Agent and at the Borrower's risk and expense, such deposits shall
not bear interest. Interest or profits, if any, on such investments shall
accumulate in such account. Moneys in such account shall be applied by the
Administrative Agent to reimburse the Issuing Lender for L/C Obligations for
which it has not been reimbursed and, to the extent not so applied, shall be
held for the satisfaction of the reimbursement obligations of the Borrower in
respect of the other L/C Obligations at such time or, if the maturity of the
Loans has been accelerated but subject to the consent of the Issuing Lender, be
applied to satisfy other Obligations; provided, however, that the Borrower shall
be entitled to all deposits in such account at such time as no Event of Default
shall then exist.
4.9 LETTER OF CREDIT RULES
----------------------
Unless otherwise expressly agreed by the Issuing Lender and the Borrower,
when a Letter of Credit is issued (including any such agreement applicable to an
Existing Letter of Credit), the rules of the "International Standby Practices
1998" published by the Institute of International Banking Law & Practice (or
such later version thereof as may be in effect at the time of issuance) shall
apply to such Letter of Credit.
Section 5. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into this
Agreement and to make the Loans and issue or participate in the Letters of
Credit, the Borrower hereby represents and warrants to the Administrative Agent
and each Lender that:
5.1 FINANCIAL CONDITION
-------------------
(a) The consolidated and consolidating balance sheets of the Borrower
and its consolidated Subsidiaries as at December 29, 2001 and December 30, 2000,
respectively, and the related consolidated and consolidating statements of
operations and of cash flows for the fiscal years ended on such dates, reported
on by BDO Seidman, LLP, copies of which have heretofore been furnished to each
Lender, present fairly, in all material respects, the consolidated and
consolidating financial condition of the Borrower and its consolidated
Subsidiaries as at such dates, and the consolidated and consolidating results of
their operations and of their cash flows for the fiscal years then ended. All
such financial statements, including the related schedules and notes thereto,
were, as of the date prepared, prepared in accordance with GAAP applied
consistently throughout the periods involved (except as otherwise expressly
noted therein, and show all material Indebtedness and other liabilities, direct
45
or contingent, of the Borrower and each of its Subsidiaries as of the dates
thereof, including liabilities for taxes, material commitments and Indebtedness.
Neither the Borrower nor any of its consolidated Subsidiaries had, at the date
of the most recent balance sheets referred to above, any material Guarantee
Obligation, material contingent liability or material liability for taxes, or
any material long-term lease or material forward or long-term commitment,
including, without limitation, any interest rate or foreign currency swap or
exchange transaction, which is not reflected in the foregoing statements or in
the notes thereto.
(b) As of the date hereof, there are no material liabilities or
obligations of the Borrower or any of its Subsidiaries, whether direct or
indirect, absolute or contingent, or matured or unmatured, other than (i) as
disclosed or provided for in the financial statements and notes thereto which
are referred to above, or (ii) which are disclosed elsewhere in this Agreement
or in the Schedules hereto, or (iii) arising in the ordinary course of business
since December 29, 2001 or (iv) created by this Agreement. As of the date
hereof, the written information, exhibits and reports furnished by the Borrower
to the Lenders in connection with the negotiation of this Agreement, taken as a
whole, are complete and correct in all material respects.
5.2 NO CHANGE
---------
Since December 29, 2001, there has been no development or event which
has had or could reasonably be expected to have a Material Adverse Effect.
5.3 CORPORATE EXISTENCE; COMPLIANCE WITH LAW
----------------------------------------
Each of the Borrower and its Subsidiaries (a) is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization, (b) has the corporate power and authority, and the legal right, to
own and operate its property, to lease the property it operates as lessee and to
conduct the business in which it is currently engaged, (c) is duly qualified as
a foreign corporation and in good standing under the laws of each jurisdiction
where its ownership, lease or operation of property or the conduct of its
business requires such qualification and (d) is in compliance with all
Requirements of Law (provided that no representation or warranty is made in this
subsection 5.3(d) with respect to Requirements of Law referred to in subsections
5.8, 5.10, 5.14 or 5.15 (b)), except to the extent that the failure of the
foregoing clauses (a) (only with respect to Subsidiaries of the Borrower which
are not Guarantors), (c) and (d) to be true and correct could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.
5.4 CORPORATE POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS
-------------------------------------------------------
Each of the Borrower and the Guarantors has the requisite corporate
power and authority, and the legal right, to make, deliver and perform the Loan
Documents to which it is a party and, in the case of the Borrower, to borrow
hereunder and has taken all necessary corporate action to authorize (in the case
of the Borrower) the borrowings on the terms and conditions of this Agreement,
any Notes and any Applications and to authorize the execution, delivery and
performance of the Loan Documents to which it is a party. No consent or
authorization of, filing with, notice to or other act by or in respect of, any
Governmental Authority or any other Person is required with respect to the
46
Borrower or any of its Subsidiaries in connection with the borrowings hereunder
or with the execution, delivery, performance, validity or enforceability of the
Loan Documents to which the Borrower or any Guarantor is a party. This Agreement
and each other Loan Document to which the Borrower or any Guarantor is, or is to
become, a party has been or will be, duly executed and delivered on behalf of
the Borrower or such Guarantor. This Agreement and each other Loan Document to
which the Borrower or any Guarantor is, or is to become, a party constitutes or
will constitute, a legal, valid and binding obligation of the Borrower or such
Guarantor, as the case may be, enforceable against the Borrower or such
Guarantor, as the case may be, in accordance with its terms, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.
5.5 NO LEGAL BAR
------------
The execution, delivery and performance of the Loan Documents, the
borrowings hereunder and the use of the proceeds thereof will not violate any
Requirement of Law or Contractual Obligation of the Borrower or of any of its
Subsidiaries which could reasonably be expected to have a Material Adverse
Effect and will not result in, or require, the creation or imposition of any
Lien on any of its or their respective properties or revenues pursuant to any
such Requirement of Law or Contractual Obligation which could reasonably be
expected to have a Material Adverse Effect.
5.6 NO MATERIAL LITIGATION
----------------------
No litigations, investigations or proceedings of or before any
arbitrator or Governmental Authority are pending or, to the knowledge of the
Borrower, threatened by or against the Borrower or any of its Subsidiaries or
against any of its or their respective properties (a) with respect to any of the
Loan Documents or any of the transactions contemplated hereby or thereby, or (b)
which if adversely determined would, individually or in the aggregate, have a
Material Adverse Effect.
47
5.7 NO DEFAULT
----------
Neither the Borrower nor any of its Subsidiaries is in default under
or with respect to any of its Contractual Obligations in any respect which could
reasonably be expected to have a Material Adverse Effect. No Default or Event of
Default has occurred and is continuing. Each of the Borrower and its
Subsidiaries and the Guarantors has satisfied all outstanding judgments (other
than any such judgment which has been stayed pending appeal) and neither the
Borrower nor any of its Subsidiaries is in default with respect to any
outstanding judgment, writ, injunction, decree, rule or regulation of any court,
arbitrator or federal, state, municipal or other governmental authority,
commission, board, bureau, agency or instrumentality, domestic or foreign,
except to the extent that such defaults would not, in any case or in the
aggregate, have a Material Adverse Effect.
5.8 TAXES
-----
Each of the Borrower and its Subsidiaries has filed or caused to be
filed all Federal, state, and other material tax returns which, to the knowledge
of the Borrower, are required to be filed and has paid all taxes shown to be due
and payable on said returns or on any assessments made against it (other than
any the amount or validity of which are currently being contested in good faith
by appropriate proceedings and with respect to which reserves in conformity with
GAAP have been provided on the books of the Borrower or its Subsidiaries, as the
case may be), except to the extent that the failure to do so could not
reasonably be expected to result in a Material Adverse Effect.
5.9 PURPOSE OF LOANS
----------------
The purpose of the Loans is to finance the working capital and general
corporate needs of the Borrower and its Subsidiaries, including, but not limited
to, Permitted Acquisitions.
5.10 ENVIRONMENTAL MATTERS
---------------------
Except to the extent that the failure of the following statements to
be true and correct could not reasonably be expected to have a Material Adverse
Effect:
(a) The facilities and properties owned, leased or operated by the
Borrower or any of its Subsidiaries (the "PROPERTIES") do not contain, and have
not previously contained, any Materials of Environmental Concern in amounts or
concentrations which (i) constitute or constituted a violation of, or (ii) could
reasonably be expected to give rise to liability under, any Environmental Law.
(b) The Properties and all operations at the Properties are in
compliance, and have in the last five years been in compliance, in all material
respects with all applicable Environmental Laws, and there is no contamination
at, under or about the Properties or violation of any Environmental Law with
respect to the Properties or the business operated by the Borrower or any of its
Subsidiaries (the "BUSINESS") which could reasonably be expected to materially
48
interfere with the continued operation of the Properties or materially impair
the fair saleable value thereof.
(c) Neither the Borrower nor any of its Subsidiaries has received any
notice of violation, alleged violation, non-compliance, liability or potential
liability regarding environmental matters or compliance with Environmental Laws
with regard to any of the Properties or the Business, nor does the Borrower have
knowledge or reason to believe that any such notice will be received or is being
threatened.
(d) Materials of Environmental Concern have not been transported or
disposed of from the Properties in violation of, or in a manner or to a location
which could reasonably be expected to give rise to liability under, any
Environmental Law, nor have any Materials of Environmental Concern been
generated, treated, stored or disposed of at, on or under any of the Properties
in violation of, or in a manner that could reasonably be expected to give rise
to liability under, any applicable Environmental Law.
(e) No judicial proceeding or governmental or administrative action is
pending or, to the knowledge of the Borrower, threatened, under any
Environmental Law to which the Borrower or any Subsidiary is or will be named as
a party with respect to the Properties or the Business, nor are there any
consent decrees or other written decrees, consent orders, administrative orders
or other orders, or other final administrative or judicial requirements
outstanding under any Environmental Law with respect to the Properties or the
Business.
(f) There has been no release or threat of release of Materials of
Environmental Concern at or from the Properties, or arising from or related to
the operations of the Borrower or any Subsidiary in connection with the
Properties or otherwise in connection with the Business, in violation of or in
amounts or in a manner that could reasonably be expected to give rise to
liability under Environmental Laws.
5.11 DISCLOSURE
----------
The statements and information contained herein and in any of the
information provided to the Administrative Agent or the Lenders in writing
(other than financial projections) in connection with or pursuant to this
Agreement, taken as a whole, do not contain any untrue statement of any material
fact, or omit to state a fact necessary in order to make such statements or
information not misleading in any material respect, in each case in light of the
circumstances under which such statements were made or information provided as
of the date so provided. The financial projections contained in the February
2002 Confidential Information Memorandum, furnished to the Administrative Agent
and the Lenders in writing in connection with this Agreement, have been prepared
in good faith based upon assumptions which were in the Borrower's judgment
reasonable when such projections were made, it being acknowledged that such
projections are subject to the uncertainty inherent in all projections of future
results and that there can be no assurance that the results set forth in such
projections will in fact be realized.
49
5.12 OWNERSHIP OF PROPERTY; LIENS
----------------------------
Each of the Borrower and its Subsidiaries 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. As of the Closing Date, the
property of the Borrower and its Subsidiaries is subject to no Liens, other than
Liens permitted by subsection 8.2.
5.13 ERISA COMPLIANCE
----------------
(a) Each Plan, other than any Multiemployer Plan, has been operated
and administered in compliance with the applicable provisions of ERISA, the Code
and other applicable Requirements of Law, except to the extent of any
noncompliance which could not reasonably be likely to result in a Material
Adverse Effect. 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 or the remedial amendment period for such Plan under Section
401(b) of the Code has not yet expired or the Plan is a prototype plan or volume
submitter plan for which a favorable determination letter is not required and,
to the best knowledge of the Borrower, nothing has occurred that has or could
reasonably be expected to result in a Material Adverse Effect (i) which has not
been remedied which would prevent, or cause the loss of, such qualification, or
(ii) as to which the Borrower does not intend to commence and complete all
necessary and required remedial measures within statutorily or regulatory
prescribed periods of time for such remedies to be undertaken so as to prevent,
or cause the loss of, such qualification. The Borrower and each ERISA Affiliate
have made all required contributions to each Plan subject to Section 412 of the
Code within the period required under applicable Requirements of Law, 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.
(b) There are no pending or, to the best knowledge of the Borrower,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan that could be reasonably be expected to have a Material
Adverse Effect. There has been no non-exempt "prohibited transaction," as
defined in Section 406 of ERISA or Section 4975 of the Code, or violation of the
fiduciary responsibility rules with respect to any Plan that has resulted or
could reasonably be expected to result in a Material Adverse Effect.
(c) (i) No Reportable Event has occurred or is reasonably expected to
occur with respect to any Plan; (ii) no Plan that is intended to qualify under
Section 401(a) of the Code has any unfunded vested liability (i.e., 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 such Plan pursuant to Section 412 of the Code
for the applicable plan year); (iii) neither the Borrower nor any ERISA
Affiliate has incurred, or reasonably expects to incur, any material liability
under Title IV of ERISA with respect to any Plan (other than premiums due and
not delinquent under Section 4007 of ERISA); (iv) neither the Borrower nor any
ERISA Affiliate has incurred, or reasonably expects to incur, any material
50
liability (and no event has occurred which, with the giving of notice under
Section 4219 of ERISA, would result in such material liability) under Section
4201 or 4243 of ERISA with respect to a Multiemployer Plan; and (v) neither the
Borrower nor any ERISA Affiliate has engaged in a transaction that could be
reasonably expected to be subject to Section 4069 or 4212(c) of ERISA.
5.14 SUBSIDIARIES
------------
The Borrower has no Subsidiaries other than those specifically
disclosed in Part (a) of Schedule 5.15 (other than those which are "shell" or
"inactive" Subsidiaries, as such terms are defined in subsection 8.4(d)) and has
no equity investments in any other corporation or entity other than those
specifically disclosed in Part (b) of Schedule 5.15.
5.15 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 Board of
Governors of the Federal Reserve System), 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, or (ii) is or is required to be registered as an "investment
company" under the Investment Company Act of 1940.
Section 6. CONDITIONS PRECEDENT
6.1 CONDITIONS TO INITIAL LOANS AND LETTERS OF CREDIT
-------------------------------------------------
The agreement of each Lender to make the initial Loan requested to be
made by it, or the Issuing Lender to issue, amend, renew or extend any Letter of
Credit, is subject to the satisfaction on the Closing Date of the following
conditions precedent:
(a) Unless waived by all the Lenders, the Administrative Agent's
receipt of the following, each of which shall be originals unless otherwise
specified, each properly executed by a Responsible Officer of the Borrower or a
Guarantor, as the case may be, 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 reasonably satisfactory to the Administrative
Agent and its legal counsel:
(i) executed counterparts of this Agreement, sufficient in number
for distribution to the Administrative Agent, each Lender, the
Borrower and each Guarantor;
51
(ii) Revolving Credit Notes executed by the Borrower in favor of
each Lender requesting such a Note, each in a principal amount equal
to such Lender's Commitment;
(iii) a Swingline Note executed by the Borrower in favor of the
Swingline Lender (if it requests such a Note) in the principal amount
of the Swingline Commitment;
(iv) such certificates of resolutions or other action, incumbency
certificates and/or other certificates of Responsible Officers of the
Borrower and/or any of the Guarantors as the Administrative Agent may
require to evidence the identities, 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;
(v) such documents and certifications as the Administrative Agent
may reasonably require to evidence that each of the Borrower and each
Guarantor is duly organized or formed, validly existing, in good
standing and qualified to engage in business in each jurisdiction in
which it is required to be qualified to engage in business to the
extent the failure to be so qualified could reasonably be expected to
have a Material Adverse Effect, including certified copies of the
organization documents, certificates of good standing and/or
qualification to engage in business and tax clearance certificates
with respect to the Borrower and the Guarantors; provided that any tax
status or clearance certificates not received by the Borrower and
provided to the Administrative Agent on or prior to the Closing Date
shall be delivered by the Borrower to the Administrative Agent as soon
as available but in no event more than 180 days after the Closing
Date;
(vi) a certificate signed by a Responsible Officer of the
Borrower certifying (A) that the conditions specified in subsections
6.2(a) and (b) have been satisfied, and (B) that there is no event or
circumstance, or action, suit, investigation or proceeding pending or
threatened in any court or before any arbitrator or Governmental
Authority, since December 29, 2001 which has or could be reasonably
expected to have a Material Adverse Effect;
(vii) an opinion of counsel to the Borrower and the Guarantors in
substantially in the form set forth in EXHIBIT G;
(viii) evidence that the Existing Facility has been or
concurrently with the Closing Date is being terminated, all
Indebtedness and obligations of the Borrower incurred thereunder have
been, or with the initial Revolving Credit Loans hereunder on the
Closing Date will be, repaid and the Borrower and all Guarantors
released from all liability thereunder (except such as by their
express terms survive such repayment and termination), and all Liens,
if any, securing obligations under the Existing Facility have been or
concurrently with the Closing Date are being released;
52
(ix) a compliance certificate in the form attached hereto as
EXHIBIT H, signed by a Responsible Officer of the Borrower dated as of
the Closing Date demonstrating compliance with the financial covenants
contained in subsection 8.1 as of the end of the fiscal quarter most
recently ended prior to the Closing Date; and
(x) such other assurances, certificates, documents, consents or
opinions as the Administrative Agent or the Majority Lenders may
reasonably require.
(b) Any fees required to be paid on or before the Closing Date shall
have been paid.
(c) 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 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).
(d) In the good faith judgment of the Administrative Agent and the
Lenders:
(i) there shall not have occurred or become known to the
Administrative Agent or any of the Lenders any event, condition,
situation or status since the date of the information contained in the
financial and business projections, budgets, pro forma data and
forecasts concerning the Borrower and its Subsidiaries delivered to
the Administrative Agent and the Lenders prior to the Closing Date
that has had or could reasonably be expected to result in a Material
Adverse Effect;
(ii) no litigation, action, suit, investigation or other
arbitral, administrative or judicial proceeding shall be pending or
threatened which could reasonably be likely to result in a Material
Adverse Effect; and
(iii) the Borrower shall have received all approvals, consents
and waivers, and shall have made or given all necessary filings and
notices, as shall be required to consummate the transactions
contemplated hereby without the occurrence of any material default
under, conflict with or violation of (A) any applicable law, rule,
regulation, order or decree of any Governmental Authority or arbitral
authority or (B) any agreement, document or instrument to which the
Borrower or any Subsidiary is a party or by which any of them or their
properties is bound.
6.2 CONDITIONS TO EACH LOAN AND LETTER OF CREDIT
-------------------------------------------
The agreement of each Lender to make any Loan requested to be made by
it on any date, or the Issuing Lender to issue, amend, renew or extend any
53
Letter of Credit (including, without limitation, its initial Loan) is subject to
the satisfaction of the following conditions precedent:
(a) REPRESENTATIONS AND WARRANTIES.
-------------------------------
Each of the representations and warranties made by the Borrower or any
Guarantor in or pursuant to the Loan Documents shall be true and correct in all
material respects on and as of such date as if made on and as of such date (or,
if such representation or warranty is expressly stated to have been made as of a
specific date, as of such specific date).
(b) NO DEFAULT.
-----------
No Default or Event of Default shall have occurred and be continuing
on such date or after giving effect to the Loans requested to be made or the
Letter(s) of Credit requested to be issued.
(c) OTHER Documents.
-----
The Administrative Agent shall have received, in form and substance
reasonably satisfactory to it, such other assurances, certificates, documents or
consents related to the foregoing as the Administrative Agent or the Majority
Lenders reasonably may require.
Each Borrowing (and request for the same) by the Borrower hereunder shall
constitute a representation and warranty by the Borrower as of the date hereof
that the conditions contained in this subsection have been satisfied.
Section 7. AFFIRMATIVE COVENANTS
The Borrower hereby agrees that, so long as the Commitments (or any of
them) remain in effect, any Letter of Credit is outstanding or any amount is
owing to any Lender or the Administrative Agent hereunder or under any other
Loan Document, the Borrower shall, and (except in the case of delivery of
financial information, reports and notices) shall cause each of its Subsidiaries
to:
7.1 FINANCIAL STATEMENTS.
---------------------
Furnish to each Lender:
(a) as soon as available, but in any event within 90 days after the
end of each fiscal year of the Borrower, a copy of the audited consolidated and
consolidating balance sheets of the Borrower and its consolidated Subsidiaries
as at the end of such year and the related consolidated and consolidating
statements of operations and stockholders' equity and of cash flows for such
year, setting forth in each case in comparative form the figures as of the end
of and for the previous year, reported on without a qualification arising out of
the scope of the audit, by BDO Seidman, LLP or any other independent certified
public accountants of nationally recognized standing reasonably acceptable to
the Majority Lenders, including a break-out of each Guarantor on a separate
schedule and an executive summary of the management letter prepared by such
54
accountants; provided, however, that if a Default or Event of Default shall have
occurred and shall be continuing, the full text of such management letter shall
be provided to the Administrative Agent; and
(b) as soon as available, but in any event not later than 45 days
after the end of each of the first three quarterly periods of each fiscal year
of the Borrower, the unaudited consolidated and consolidating balance sheets of
the Borrower and its consolidated Subsidiaries as at the end of each such
quarter and the related unaudited consolidated and consolidating statements of
operations and of cash flows for such quarter and the portion of the fiscal year
through the end of such quarter, setting forth in each case in comparative form
the figures as of the end of and for the corresponding period or periods in the
previous year, including a break-out of each Guarantor on a separate schedule
certified by a Responsible Officer of the Borrower as being fairly stated in all
material respects (subject to normal, recurring, year-end audit adjustments and
the absence of GAAP notes thereto).
(c) All such financial statements shall be prepared in reasonable
detail and in accordance with GAAP applied consistently throughout the periods
reflected therein and with prior periods (subject, in the case of the aforesaid
quarterly financial statements, to normal, recurring, year-end audit adjustments
and the absence of GAAP notes thereto).
7.2 CERTIFICATES; OTHER INFORMATION
-------------------------------
Furnish to the Administrative Agent and each of the Lenders:
(a) simultaneously with the delivery of the financial statements
referred to in subsections 7.1(a) and (b), a certificate of the chief financial
officer of the Borrower, certifying that to the best of his knowledge (i) no
Default or Event of Default has occurred and is continuing or, if a Default or
Event of Default has occurred and is continuing, a statement as to the nature
thereof and the action which is proposed to be taken with respect thereto, with
computations demonstrating compliance (or non-compliance, as the case may be)
with the covenants contained in subsection 8.1, and (ii) such financial
statements have been prepared in accordance with GAAP (subject in the case of
subsection 7.1(b) to normal, recurring, year-end adjustments and except for the
absence of GAAP notes thereto);
(b) promptly, such additional financial and other information as the
Administrative Agent or any Lender through the Administrative Agent may from
time to time reasonably request;
(c) promptly after the same are available, and in any event within
five (5) Business Days after the sending or filing thereof, copies of all proxy
statements, financial statements and reports which the Borrower or any of its
Subsidiaries sends to its stockholders, and copies of all regular, periodic and
special reports and all registration statements which the Borrower or any such
Subsidiary files with the Securities and Exchange Commission or any governmental
authority which may be substituted therefor, or with any national securities
exchange or state securities administration;
55
(d) simultaneously with the delivery of the annual financial
statements referred to in subsection 7.1(a), a certificate of the independent
public accountants who audited such statements to the effect that, in making the
examination necessary for the audit of such statements, they have obtained no
knowledge of any condition or event which constitutes a Default or Event of
Default, or if such accountants shall have obtained knowledge of any such
condition or event, specifying in such certificate each such condition or event
of which they have knowledge and the nature and status thereof; and
(e) within forty-five (45) days after the end of each fiscal year of
the Borrower, the annual budget of the Borrower and its Subsidiaries for the
then current fiscal year in a form reasonably satisfactory to the Lenders, and
copies of any material updates, amendments or modifications to the Borrower's
"Corporate Strategic Plan" from time to time, within five Business Days after
the occurrence and completion of the same.
7.3 CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE
------------------------------------------------
(a) Preserve, renew and keep in full force and effect its corporate
existence and good standing under the laws of its jurisdiction of organization
(except as could not in the aggregate be reasonably expected to have a Material
Adverse Effect or as is otherwise permitted pursuant to subsection 8.12), (b)
take all reasonable action to maintain all rights, privileges and franchises
necessary in the normal conduct of its business, except as otherwise permitted
pursuant to subsection 8.12 and (c) comply with all Contractual Obligations and
Requirements of Law except to the extent that failure to comply therewith could
not, in the aggregate, be reasonably expected to have a Material Adverse Effect.
7.4 PAYMENT OF OBLIGATIONS
----------------------
Pay and discharge all of its obligations and liabilities as the same
shall become due and payable, 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 (other than Liens permitted by subsection
8.2); and (c) all Indebtedness, as and when due and payable (after giving effect
to any applicable grace periods), (i) but subject to any subordination
provisions contained in any instrument or agreement evidencing such Indebtedness
and (ii) 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.
7.5 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 excepted; and (b) make all necessary repairs
thereto and renewals and replacements thereof except where the failure to do so
could not reasonably be expected to have a Material Adverse Effect.
56
7.6 MAINTENANCE OF INSURANCE
------------------------
Maintain with financially sound and reputable insurance companies,
insurance with respect to its properties and business against loss or damage of
the kinds customarily insured against by Persons engaged in the same or similar
business, of such types and in such amounts as are customarily carried under
similar circumstances by such other Persons; and furnish to the Administrative
Agent, upon written request, information as to the insurance carried.
7.7 BOOKS AND RECORDS
-----------------
(a) Maintain proper books of record and account in conformity with
GAAP consistently applied in which all entries required by GAAP shall be made of
all financial transactions and matters involving the assets and business of the
Borrower and its Subsidiaries, and (b) maintain such books of record and account
in conformity with all applicable requirements of any Governmental Authority
having regulatory jurisdiction over the Borrower or any of its Subsidiaries,
except where the failure to so comply would not result in a Material Adverse
Effect.
7.8 INSPECTION RIGHTS
-----------------
Subject to subsection 11.14, 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 officers and independent public accountants, at
such reasonable times during normal business hours as may be reasonably desired,
upon reasonable advance notice to a Responsible Officer of the Borrower or such
Guarantor, as the case may be; provided, however, that (a) the Lenders shall use
reasonable efforts to coordinate with the Administrative Agent in order to
minimize the number of such inspections and discussions; (b) with respect to
access for environmental inspections, the Administrative Agent shall only have
the right to inspect once every twelve (12) months unless the Administrative
Agent has reason to believe that a condition exists or an event has occurred
which reasonably could give rise to liability under the Environmental Laws and
(c) when an Event of Default has occurred and is continuing, 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.
7.9 COMPLIANCE WITH ERISA
---------------------
Do, and cause each of its ERISA Affiliates to do, each of the
following: (a) maintain each Plan in material compliance with the applicable
provisions of ERISA, the Code and other applicable Requirements of Law; (b)
cause each Plan which is qualified under Section 401(a) of the Code to maintain
such qualification; and (c) make all required contributions to any Plan subject
to Section 412 of the Code within the period required under applicable
Requirements of Law.
57
7.10 ENVIRONMENTAL COMPLIANCE
------------------------
If the Borrower or any Subsidiary shall receive any written letter,
notice, complaint, order, directive, claim or citation alleging that any
Borrower or any Subsidiary has violated any Environmental Law, has released any
Matters of Environmental Concern, or is liable for the costs of cleaning up,
removing, remediating or responding to a release of Matters of Environmental
Concern, within the time period permitted and to the extent required by the
applicable Environmental Law or the Governmental Authority responsible for
enforcing such Environmental Law, remove or remedy, or cause the applicable
Subsidiary to remove or remedy, such violation or release or satisfy such
liability unless (a) the failure to remove or remedy such violation or release
or to satisfy such liability would not reasonably be expected to have a Material
Adverse Effect, in which case the Borrower shall notify the Administrative Agent
of any decision not to remove or remedy such violation or release or satisfy
such liability and the basis for any such decision, and at the Administrative
Agent's option and at its request, the Borrower shall provide written
documentation of such decision, or (b) such violation or liability is being
contested in good faith by appropriate proceedings and appropriate reserves
therefor are being maintained in accordance with GAAP.
7.11 USE OF PROCEEDS
---------------
Use the proceeds of Loans to refinance existing Indebtedness under the
Existing Facility, for general corporate purposes of the Borrower and its
Subsidiaries in the ordinary course of business, and for Permitted Acquisitions.
7.12 NOTICES
-------
Promptly give notice to the Administrative Agent and each Lender upon
obtaining actual knowledge of:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any Contractual
Obligation of the Borrower or any of its Subsidiaries, or (ii) litigation,
investigation or proceeding which, in either case, could reasonably be expected
to have a Material Adverse Effect;
(c) the following events, as soon as possible and in any event within
30 days after the Borrower knows thereof: (i) the occurrence or reasonably
expected occurrence of any Reportable Event with respect to any Plan, a failure
to make any required contribution to a Plan within the period required by
applicable law, the creation of any Lien in favor of the PBGC or a Plan or any
withdrawal from, or the termination, Reorganization or Insolvency of, any
Multiemployer Plan or (ii) the institution of proceedings or the taking of any
other similar action by the PBGC or the Borrower or any Commonly Controlled
Entity or any Multiemployer Plan with respect to the withdrawal from, or the
terminating, Reorganization or Insolvency of, any Plan, other than the
termination of any Single Employer Plan that is not a distress termination
pursuant to Section 4041(c) of ERISA where, with respect to any event listed
58
above, the amount of liability the Borrower or any Commonly Controlled Entity
could reasonably be expected to have a Material Adverse Effect; and
(d) (i) simultaneously with the delivery of the financial statements
referred to in subsections 7.1(a) and (b), quarterly reports in form and
substance satisfactory to the Administrative Agent, describing all Acquisitions
consummated by the Borrower or any of its Subsidiaries during the preceding
fiscal quarter, which reports shall include, with respect to each Acquisition
involving total consideration paid or total assets acquired, in either case, in
excess of $25,000,000, pro forma calculations demonstrating that after giving
effect to such Acquisition, no Default or Event of Default is occurring, and
(ii) any notices or information which may be required pursuant to subsection
8.12.
Each notice pursuant to this subsection 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 proposes to take with
respect thereto.
7.13 ADDITIONAL GUARANTORS
---------------------
Simultaneously with (a) any Person becoming a Significant Subsidiary
or (b) any Subsidiary or Affiliate becoming a guarantor under or with respect to
any of the Note Purchase Agreements, cause such Person to enter into a guarantee
assumption agreement in the form of EXHIBIT C (or such other agreement in form
and substance reasonably acceptable to the Majority Lenders), and thereupon such
Person shall become a Guarantor hereunder for all purposes.
Section 8. NEGATIVE COVENANTS
The Borrower hereby agrees that, so long as the Commitments (or any of
them) remain in effect, any Letter of Credit remains outstanding, or any amount
is owing to any Lender or the Administrative Agent hereunder or under any other
Loan Document, the Borrower shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly:
8.1 FINANCIAL COVENANTS
-------------------
(a) CONSOLIDATED LEVERAGE RATIO. Permit the Consolidated Leverage
Ratio at any time during any period of four consecutive fiscal quarters of the
Borrower to exceed 3.0 to 1.0.
(b) CONSOLIDATED INTEREST COVERAGE RATIO. Permit the Consolidated
Interest Coverage Ratio at any time during any period of four consecutive fiscal
quarters of the Borrower to be less than 5.0 to 1.0.
(c) The Borrower and its Subsidiaries must be in compliance with the
foregoing covenants at all times during the relevant periods; and all such
covenants shall be tested quarterly.
59
8.2 LIMITATION ON LIENS
-------------------
Create, incur, assume or suffer to exist any Lien upon any of its property,
assets or revenues, whether now owned or hereafter acquired, except for:
(a) Liens for taxes not yet due or which are being contested in good
faith by appropriate proceedings, PROVIDED that adequate reserves with respect
thereto are maintained on the books of the Borrower or its Subsidiaries, as the
case may be, in conformity with GAAP;
(b) carriers', warehousemen's, mechanics', materialmen's, repairmen's
or other like Liens arising in the ordinary course of business which are not
overdue for a period of more than 30 days or which are being contested in good
faith by appropriate proceedings diligently conducted, if adequate reserves with
respect thereto are maintained on the books of the applicable Person in
accordance with GAAP;
(c) pledges or deposits made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance and other social
security legislation and deposits made in the ordinary course of business
securing liability to insurance carriers under insurance or self-insurance
arrangements;
(d) deposits to secure the performance of bids, trade or government
contracts (other than for borrowed money), leases, statutory obligations, surety
and appeal bonds, performance bonds and other obligations of a like nature
incurred in the ordinary course of business;
(e) easements, rights-of-way, restrictions, building, zoning and other
similar encumbrances or restrictions, utility agreements, covenants,
reservations and encroachments and other similar encumbrances, or leases or
subleases, incurred in the ordinary course of business which, in the aggregate,
are not substantial in amount and which do not, in the aggregate, materially
detract from the value of the properties of the Borrower and its Subsidiaries,
taken as a whole, or materially interfere with the ordinary conduct of the
business of the Borrower and its Subsidiaries, taken as a whole;
(f) Liens securing Indebtedness in respect of capital leases and
purchase money obligations for fixed or capital assets; 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 being acquired on
the date of acquisition and (iii) such Indebtedness was not incurred in
connection with, or in anticipation or contemplation of, a Permitted
Acquisition;
(g) Liens on the assets of Receivable Subsidiaries created pursuant to
any Receivables Transaction permitted pursuant to subsection 8.3(a);
(h) Liens created or arising pursuant to any Loan Documents;
(i) Liens granted by any Subsidiary in favor of the Borrower;
60
(j) judgment and other similar Liens arising in connection with court
proceedings in an aggregate amount not in excess of $1,000,000 (except to the
extent covered by independent third-party insurance) provided that the execution
or other enforcement of such Liens is effectively stayed and the claims secured
thereby are being actively contested in good faith and by appropriate
proceedings;
(k) Liens arising from precautionary UCC financing statements
regarding operating leases or consignments; or
(l) Liens (not otherwise permitted hereunder) which secure obligations
or Indebtedness of the Borrower or any of its Subsidiaries not exceeding an
aggregate amount of $20,000,000 at any time outstanding.
8.3 LIMITATION ON INDEBTEDNESS
--------------------------
Create, issue, incur, assume, become liable in respect of or suffer to
exist:
(a) any Indebtedness pursuant to any Receivables Transaction, except
for Indebtedness pursuant to all Receivables Transactions that is (i)
non-recourse with respect to the Borrower and its Subsidiaries (other than any
Receivables Subsidiary) and (ii) in an aggregate principal amount at any time
outstanding not exceeding 10% of Consolidated Total Assets at such time; or
(b) any Indebtedness of any of the Subsidiaries other than (i)
Indebtedness of any Receivables Subsidiary pursuant to any Receivables
Transaction permitted under subsection 8.3(a), (ii) any Indebtedness of any
Subsidiary as a guarantor under or pursuant to any of those certain Note
Purchase Agreements dated as of June 30, 1999 and September 25, 1998, as
amended, respectively, between the Borrower and the various note holders
thereunder, (iii) any Indebtedness of any Subsidiary which is a Guarantor, (iv)
any Indebtedness arising in respect of capital leases or purchase money
obligations incurred in accordance with subsection 8.2(f), and (v) any other
Indebtedness of Subsidiaries in an aggregate principal amount at any time
outstanding not to exceed five percent of Consolidated Total Assets at such
time.
8.4 FUNDAMENTAL CHANGES
-------------------
Liquidate, windup or dissolve (or suffer any liquidation or
dissolution), or merge, consolidate with or into, or convey, transfer, lease,
sell, assign or otherwise 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, except that, so long as no
Default or Event of Default exists or would result therefrom:
(a) any Subsidiary may merge with (i) the Borrower, provided that the
Borrower shall be the continuing or surviving Person, or (ii) any one or more
Subsidiaries, provided that (A) when any wholly-owned Subsidiary is merging with
another Subsidiary, such wholly-owned Subsidiary shall be the continuing or
surviving Person and (B) when any Foreign Subsidiary is merging with a Domestic
61
Subsidiary, such Domestic Subsidiary shall be the continuing or surviving
Person;
(b) any (i) Subsidiary may sell, transfer, contribute, convey or
otherwise dispose of all or substantially all of its assets (upon voluntary
liquidation or otherwise), to the Borrower or to a Domestic Subsidiary; provided
that if the transferor in such a transaction is a wholly-owned Subsidiary, then
the transferee must also be a wholly-owned Subsidiary; or (ii) Foreign
Subsidiary may sell, transfer, contribute, convey or otherwise dispose of all of
its assets (upon voluntary liquidation or otherwise), to any other Foreign
Subsidiary;
(c) any Subsidiary formed solely for the purpose of effecting a
Permitted Acquisition may be merged or consolidated with any other Person;
provided that the continuing or surviving corporation of such merger or
consolidation shall be a Subsidiary and provided that such transaction otherwise
satisfies the requirements of a Permitted Acquisition under subsection 8.12;
(d) "Inactive" or "shell" Subsidiaries (i.e., a Person that is not
engaged in any business and that has total assets of $500,000 or less) may be
dissolved or otherwise liquidated, provided that all of the assets and
properties of any such Subsidiaries are transferred to the Borrower upon
dissolution/liquidation; and
(e) the Borrower may merge or consolidate with any Person, provided
that the Borrower shall be the continuing or surviving Person and provided the
transaction otherwise satisfies the requirements of a Permitted Acquisition
under subsection 8.12.
8.5 DISPOSITIONS
------------
Make any Disposition or enter into any agreement to make any
Disposition, except:
(a) Dispositions of obsolete, out-moded or worn-out property, whether
now owned or hereafter acquired, in the ordinary course of business;
(b) Dispositions of inventory in the ordinary course of business;
(c) Dispositions of property by any Subsidiary to the Borrower;
(d) Dispositions of Receivables pursuant to Receivables Transactions
permitted under subsection 8.3(a);
(e) The nonexclusive license of intellectual property of the Borrower
or any of its Subsidiaries to third parties in the ordinary course of business;
(f) Without limitation to clause (a), the Borrower and its
Subsidiaries may sell or exchange specific items of machinery or equipment, so
long as the proceeds of each such sale or exchange is used (or contractually
committed to be used) to acquire (and results within one year of such sale or
exchange in the acquisition of) replacement items of machinery or equipment of
reasonably equivalent Fair Market Value; and
62
(g) Other Dispositions where (i) in the good faith opinion of the
Borrower, the Disposition is an exchange for consideration having a Fair Market
Value at least equal to that of the property Disposed of and is in the best
interest of the Borrower or the applicable Subsidiary, as the case may be; (ii)
immediately after giving effect to such Disposition, no Default or Event of
Default would exist; and (iii) immediately after giving effect to such
Disposition, the Disposition value of all property that was the subject thereof
in any fiscal four quarter period of the Borrower plus the Fair Market Value of
any other property Disposed of during such four quarter period does not equal or
exceed 15% of Consolidated Total Assets as of the end of the then most recently
ended fiscal quarter of Borrower.
8.6 ERISA
-----
Engage in a transaction which could be subject to Section 4069 or
4212(c) of ERISA, or permit any Plan to (a) engage in any non-exempt "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the Code);
(b) fail to comply with ERISA or any other applicable Laws; or (c) incur any
material "accumulated funding deficiency" (as defined in Section 412 of the Code
or Section 302 of ERISA), which, with respect to any event listed above, could
reasonably be expected to have a Material Adverse Effect.
8.7 SWAP AGREEMENTS
---------------
Enter into any Swap Agreement, except (a) Swap Agreements entered into
to hedge or mitigate risks to which the Borrower or any Subsidiary has actual
exposure (other than those in respect of Equity Interests or Restricted Payments
of the Borrower or any of its Subsidiaries), including hedging agreements with
respect to raw materials to be used in the business of Borrower and its
Subsidiaries, and (b) Swap Agreements entered into in order to effectively cap,
collar or exchange interest rates (from fixed to floating rates, from one
floating rate to another floating rate or otherwise) with respect to any
interest-bearing liability or investment of the Borrower or any Subsidiary.
8.8 CONDUCT OF BUSINESS
-------------------
From and after the Closing Date, engage in any business other than the
distribution of medical, dental, veterinary, hospital or health care products,
equipment or related services and/or technology, those businesses ancillary
thereto or such other lines of business in which the Borrower and/or its
Subsidiaries are engaged as of the Closing Date.
8.9 TRANSACTIONS WITH AFFILIATES
----------------------------
Enter into any transaction of any kind with any Affiliate of the
Borrower, other than for compensation and upon fair and reasonable terms with
Affiliates in transactions that are otherwise permitted hereunder no less
favorable to the Borrower or any Subsidiary than would be obtained in a
comparable arm's-length transaction with a Person other than an Affiliate,
provided, the foregoing restriction shall not apply to (a) any transaction
between the Borrower and any of its Subsidiaries or between any of its
Subsidiaries, (b) reasonable and customary fees paid to members of the Boards of
Directors of the Borrower and its Subsidiaries, (c) transactions effected as
63
part of a Receivables Transaction or (d) compensation arrangements of officers
and other employees of the Borrower and its Subsidiaries entered into in the
ordinary course of business.
8.10 BURDENSOME AGREEMENTS
---------------------
Enter into any Contractual Obligation that limits the ability in any
material respect (a) of any Subsidiary to make Restricted Payments to the
Borrower or to otherwise transfer property to the Borrower or (b) of the
Borrower or any Subsidiary to create, incur, assume or suffer to exist
Indebtedness or Liens on property of such Person, other than standard and
customary negative pledge provisions in property acquired with the proceeds of
any capital lease or purchase money financing that extend and apply only to such
acquired property.
8.11 USE OF PROCEEDS
---------------
Use the proceeds of any Borrowing, whether directly or indirectly, and
whether immediately, incidentally or ultimately, to purchase or carry margin
stock (within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System) or to extend credit to others for the purpose of
purchasing or carrying margin stock or to refund indebtedness originally
incurred for such purpose, or for any purpose other than as provided in
subsection 7.13.
8.12 ACQUISITIONS
------------
Enter into any agreement, contract, binding commitment or other
arrangement providing for any Acquisition, or take any action to solicit the
tender of securities or proxies in respect thereof in order to effect any
Acquisition, other than Acquisitions satisfying the conditions below (the
"Permitted Acquisitions"). So long as no Default or Event of Default has
occurred and is continuing, the Borrower or any Subsidiary of the Borrower may
engage in any Acquisition with any Person whose line or lines of business
include the distribution of medical, dental, veterinary, hospital, or health
care technology, provided that:
(a) after giving effect to any such Acquisition, no Default or Event
of Default shall exist at the time of any such Acquisition or at the time or as
a result of the consummation of the transaction contemplated thereby;
(b) the Borrower shall notify the Lenders of the consummation of any
such Acquisition, with respect to which the aggregate cash amount paid or
payable exceeds $25,000,000, within 15 Business Days of the consummation
thereof, and provide the Lenders at such time with evidence reasonably
satisfactory to the Lenders (which evidence shall include pro forma financial
statements after giving effect to the proposed Permitted Acquisition) that after
giving effect to such Acquisition, no Default or Event of Default shall have
existed at the time of any such Acquisition or at the time or as a result of the
consummation of the transactions contemplated thereby;
64
(c) the aggregate cash amounts paid or payable with respect to any one
Acquisition (whether structured as a single transaction or a series of related
transactions) from and after the date hereof to and including the Termination
Date shall not exceed an amount equal to 25% of the Aggregate Revolving Credit
Commitments at the time of consummation of any such transaction without the
prior written consent of the Majority Lenders;
(d) if, upon the closing of the transactions contemplated by an
Acquisition, any such acquiring or acquired Person is or becomes a Significant
Subsidiary, simultaneously with a consummation of such transaction such
Significant Subsidiary shall become a Guarantor pursuant to the provisions of
subsection 7.13; and
(e) notwithstanding anything contained herein to the contrary, no
hostile takeover shall be attempted or consummated (i.e., an Acquisition that
has not been either (1) approved by the board of directors of the corporation
which is the subject of such Acquisition or (2) recommended for approval by such
board to the shareholders of such corporation and subsequently approved by the
shareholders of such corporation as required under applicable law or by the
by-laws and the certificate or incorporation of such corporation).
8.13 INVESTMENTS, LOANS, ADVANCES, GUARANTEES AND ACQUISITIONS
---------------------------------------------------------
The Borrower will not, and will not permit any of its Subsidiaries to,
purchase, hold or acquire (including pursuant to any merger with any Person that
was not a wholly owned Subsidiary prior to such merger) any Equity Interests,
evidences of indebtedness or other securities (including any option, warrant or
other right to acquire any of the foregoing) of, make or permit to exist any
loans or advances to, guarantee any obligations of, or make or permit to exist
any investment or any other interest in, any other Person, or purchase or
otherwise acquire (in one transaction or a series of transactions) any assets of
any other Person constituting a business unit (which shall not include, for the
avoidance of doubt, capital expenditures made in the ordinary course of
business), except:
(a) Permitted Investments;
(b) investments by the Borrower existing on the date hereof in the
Equity Interests of its Subsidiaries;
(c) the Borrower and its Subsidiaries may acquire and own investments
(including debt obligations) received in connection with the bankruptcy or
reorganization of suppliers and customers and in settlement of delinquent
obligations of, and other disputes with, customers and suppliers arising in the
ordinary course of business;
(d) the Borrower and its Subsidiaries may acquire and own investments
pursuant to Swap Agreements not prohibited by subsection 8.7;
(e) advances, loans and investments existing on the Closing Date and
listed on Schedule 8.13(e);
65
(f) deposits made in the ordinary course of business to secure the
performance of leases or other contractual arrangements shall be permitted;
(g) loans and advances by the Borrower and its Subsidiaries to
employees of the Borrower and such Subsidiaries for moving and travel and other
similar expenses or in connection with stock or stock option purchases of the
Borrower by employees of the Borrower and such Subsidiaries pursuant to
compensatory plans, arrangements or agreements in the ordinary course of
business, in an aggregate amount at any time outstanding not to exceed
$5,000,000;
(h) the Borrower may make intercompany loans, advances and investments
to any of its Subsidiaries which are Guarantors, any Subsidiary may make
intercompany loans, advances and investments to the Borrower and any Subsidiary
may make intercompany loans, advances and investments to any other Subsidiary
that is a Guarantor;
(i) Foreign Subsidiaries may make intercompany loans, advances and
investments to or in other Foreign Subsidiaries;
(j) investments, loans or advances made by the Borrower to (i) any
Domestic Subsidiary which is not a Guarantor or (ii) any Affiliates (other than
Subsidiaries) or Foreign Subsidiaries provided that the aggregate amount at any
time outstanding under (i) and (ii) above shall not exceed $75,000,000. For
purposes of this subparagraph (j), the amount included in "investments, loans or
advances" shall mean only (A) loans or advances which are recorded as debt in
accordance with GAAP and advances made on behalf of Affiliates or Foreign
Subsidiaries which are not repaid within 120 days of the date of such advance,
(B) the purchase price of the interest purchased (at the time of purchase) or
(C) the amount of cash or the value of assets contributed (at the time of
contribution);
(k) Guarantees constituting Indebtedness permitted by subsection 8.3;
(l) the Borrower may incur Guarantee Obligations on behalf of any
Subsidiary which is a Guarantor and any Guarantor may incur Guarantee
Obligations on behalf of the Borrower , provided that when computing the amount
of Indebtedness resulting from any such Guarantee Obligations, only the primary
obligation shall be included;
(m) the Borrower may incur Guarantee Obligations on behalf of any
Subsidiary which is not a Guarantor and any Subsidiary may
incur Guarantee Obligations on behalf of Borrower; and
(n) Acquisitions permitted by subsection 8.12.
8.14 RESTRICTED PAYMENTS
-------------------
Declare or make, directly or indirectly, any Restricted Payment, or
incur any obligation (contingent or otherwise) to do so, except that:
66
(a) each Subsidiary may make Restricted Payments to the Borrower and
to wholly-owned Subsidiaries (and, in the case of a Restricted Payment by a
non-wholly-owned Subsidiary, to the Borrower and any Domestic Subsidiary and to
each other owner of Equity Interests of such Subsidiary on a pro rata basis
based on their relative ownership interests);
(b) the Borrower and each Subsidiary may declare and make Restricted
Payments or other distributions payable solely in the common stock of such
Person;
(c) the Borrower and each Subsidiary may purchase, redeem or otherwise
acquire shares of its common stock or warrants or options to acquire any such
shares with the proceeds received from the substantially concurrent issue of new
shares of its common stock; and
(d) the Borrower may declare or pay cash dividends in any fiscal year
to its stockholders and purchase, redeem or otherwise acquire shares of its
Equity Interests or warrants, rights or options to acquire any such shares for
cash; provided that no such cash payments in any fiscal year shall exceed the
greater of (x) $25,000,000 and (y) 40 percent of the consolidated net income of
the Borrower and its Subsidiaries for such fiscal year, determined on a
consolidated basis and as calculated consistent with the manner disclosed by the
Borrower's Annual Report on Form 10-K for the fiscal year ended December 29,
2001.
Section 9. EVENTS OF DEFAULT
Any of the following shall constitute an Event of Default:
(a) The Borrower shall fail to pay any principal of any Loan or any
Reimbursement Obligation when due in accordance with the terms thereof or
hereof; or the Borrower shall fail to pay any interest on any Loan, or any fee
or other amount payable hereunder, within three Business Days after any such
interest or other amount becomes due in accordance with the terms thereof or
hereof; or
(b) Any representation or warranty made or deemed made by the Borrower
or any Guarantor herein or in any other Loan Document or which is contained in
any certificate, document or financial or other statement furnished by it at any
time under or in connection with this Agreement shall prove to have been
incorrect or misleading in any material respect when made or deemed made or
furnished; or
(c) (i) The Borrower shall default in the observance or performance of
any covenant contained in subsection 7.8, subsection 7.11, subsection 7.12 or
Section 8; or (ii) the Borrower shall default in the observance or performance
of any covenant contained in subsection 7.1, and such default shall continue
unremedied for a period of 10 days; or (iii) the Borrower shall default in the
observance or performance of any other agreement contained in this Agreement
(other than as provided above in this Section), and such default described in
this clause (c)(iii) shall continue unremedied for a period of 30 days; PROVIDED
that if any such default covered by this clause (c)(iii), (x) is not capable of
being remedied within such 30-day period, (y) is capable of being remedied
within an additional 30-day period and (z) the Borrower is diligently pursuing
67
such remedy during the period contemplated by (x) and (y) and has advised the
Administrative Agent as to the remedy thereof, the first 30-day period referred
to in this clause (c)(iii) shall be extended for an additional 30-day period but
only so long as (A) the Borrower continues to diligently pursue such remedy, (B)
such default remains capable of being remedied within such period and (C) any
such extension could not reasonably be expected to have a Material Adverse
Effect; or
(d) The Borrower or any of the Guarantors shall (i) default in any
payment of principal of or interest on any Indebtedness (other than the Loans)
or in the payment of any Guarantee Obligation, beyond the period of grace, if
any, provided in the instrument or agreement under which such Indebtedness or
Guarantee Obligation was created; or (ii) default in the observance or
performance of any other agreement or condition relating to any such
Indebtedness or Guarantee Obligation or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event or condition is to
cause, or to permit the holder or holders of such Indebtedness or beneficiary or
beneficiaries of such Guarantee Obligation (or a trustee or agent on behalf of
such holder or holders or beneficiary or beneficiaries) to cause, with the
giving of notice if required, such Indebtedness to become due prior to its
stated maturity or such Guarantee Obligation to become payable; PROVIDED,
HOWEVER, that except with respect to any Default or Event of Default of the type
described under subsection 9(d)(i) or any other material Default or Event of
Default of the type described under subsection 9(d)(ii) which shall have
occurred in connection with any of those certain Note Purchase Agreements dated
as of June 30, 1999 and September 25, 1998, as amended, between the Borrower and
the various note holders party thereto, no Default or Event of Default shall
exist under this paragraph unless the aggregate amount of Indebtedness and/or
Guarantee Obligations in respect of which any default or other event or
condition referred to in this paragraph shall have occurred shall be equal to at
least $20,000,000; or
(e) (i) The Borrower, any of its Significant Subsidiaries or any of
the Guarantors shall commence any case, proceeding or other action (A) under any
existing or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it a
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
winding-up, liquidation, dissolution, composition or other relief with respect
to it or its debts, or (B) seeking appointment of a receiver, trustee,
custodian, conservator or other similar official for it or for all or any
substantial part of its assets, or the Borrower, any of its Significant
Subsidiaries or any of the Guarantors shall make a general assignment for the
benefit of its creditors; or (ii) there shall be commenced against the Borrower,
any of its Significant Subsidiaries or any of the Guarantors any case,
proceeding or other action of a nature referred to in clause (i) above which (A)
results in the entry of an order for relief or any such adjudication or
appointment or (B) remains undismissed, undischarged or unbonded for a period of
60 calendar days; or (iii) there shall be commenced against the Borrower, any of
its Significant Subsidiaries or any of the Guarantors any case, proceeding or
other action seeking issuance of a warrant of attachment, execution, distraint
or similar process against all or any substantial part of its assets which
results in the entry of an order for any such relief which shall not have been
vacated, discharged, or stayed or bonded pending appeal within 30 calendar days
from the entry thereof; or (iv) the Borrower, any of its Significant
68
Subsidiaries or any of the Guarantors shall take any action in furtherance of,
or indicating its consent to, approval of, or acquiescence in, any of the acts
set forth in clause (i), (ii), or (iii) above; or (v) the Borrower, any of its
Significant Subsidiaries or any of the Guarantors shall generally not or shall
admit in writing its inability to, pay its debts as they become due; or
(f) (i) The Borrower or any Commonly Controlled Entity shall engage in
any non-exempt "prohibited transaction," as defined in Section 406 of ERISA or
Section 4975 of the Code, involving any Plan, (ii) any "accumulated funding
deficiency" (as defined in Section 302 of ERISA), whether or not waived, shall
exist with respect to any Plan or any Lien in favor of the PBGC or a Plan shall
arise on the assets of the Borrower or any Commonly Controlled Entity, (iii) a
Reportable Event shall occur with respect to, or proceedings shall commence to
have a trustee appointed (or a trustee shall be appointed) to administer, or to
terminate, any Single Employer Plan, which Reportable Event or commencement of
proceedings or appointment of a trustee is likely to result in the termination
of such Plan for purposes of Title IV of ERISA, (iv) any Single Employer Plan
shall terminate for purposes of Title IV of ERISA in a distress termination (as
defined in Section 4041(c) of ERISA), (v) the Borrower or any Commonly
Controlled Entity shall incur any liability in connection with a withdrawal
from, or the Insolvency or Reorganization of, a Multiemployer Plan or (vi) any
other event or condition shall occur or exist with respect to a Plan; and in
each case in clauses (i) through (vi) above, such event or condition, together
with all other such events or conditions, if any, has resulted in or could
reasonably be expected to result in liability in an aggregate amount of
$20,000,000 or more; or
(g) One or more judgments or decrees shall be entered against the
Borrower or any of its Subsidiaries involving in the aggregate a liability (not
paid or in excess of the amount recoverable by insurance) of $20,000,000 or
more, or one or more non-monetary judgments or decrees shall be entered against
Borrower or any of its Subsidiaries that have, or could reasonably be expected
to have, a Material Adverse Effect, and all such judgments or decrees shall not
have been vacated, discharged, stayed or bonded pending appeal within 30 days
from the entry thereof; or
(h) (i) Any Person or "group" (within the meaning of Section 13(d) or
14(d) of the Securities Exchange Act of 1934, as amended) (A) shall have
acquired beneficial ownership of 30% or more of any outstanding class of Equity
Interests having ordinary voting power in the election of directors of the
Borrower (other than the aggregate beneficial ownership of the Persons who are
officers or directors of the Borrower on the Closing Date or (B) shall obtain
the power (whether or not exercised) to elect a majority of the Borrower's
directors or (ii) the Board of Directors of the Borrower shall not consist of a
majority of Continuing Directors; or
(i) Any Loan Document, at any time after its execution and delivery
and for any reason other than the agreement of all the Lenders or satisfaction
in full of all the Obligations, ceases to be in full force and effect, or is
declared by a court of competent jurisdiction to be null and void, invalid or
unenforceable in any respect; or the Borrower denies that it has any or further
liability or obligation under any Loan Document, or purports to revoke,
terminate or rescind any Loan Document;
69
then, and in any such event, (A) if such event is an Event of Default specified
in paragraph (e) or paragraph (i) above, automatically the Commitments shall
immediately terminate and the Loans hereunder (with accrued interest thereon)
and all other amounts owing under this Agreement and the other Loan Documents
(including, without limitation, all amounts of L/C Obligations, whether or not
the beneficiaries of the then outstanding Letters of Credit shall have presented
the documents required thereunder) shall immediately become due and payable, and
(B) if such event is any other Event of Default, either or both of the following
actions may be taken: (i) with the consent of the Majority Lenders, the
Administrative Agent may, or upon the request of the Majority Lenders, the
Administrative Agent shall, by notice to the Borrower declare the Commitments to
be terminated forthwith, whereupon the Commitments shall immediately terminate;
and (ii) with the consent of the Majority Lenders, the Administrative Agent may,
or upon the request of the Majority Lenders, the Administrative Agent shall, by
notice to the Borrower, declare the Loans hereunder (with accrued interest
thereon) and all other amounts owing under this Agreement and the other Loan
Documents (including, without limitation, all amounts of L/C Obligations,
whether or not the beneficiaries of the then outstanding Letters of Credit shall
have presented the documents required thereunder) to be due and payable
forthwith, whereupon the same shall immediately become due and payable. In the
case of all Letters of Credit with respect to which presentment for honor shall
not have occurred at the time of an acceleration pursuant to this paragraph, the
Borrower shall at such time deposit in a cash collateral account opened by the
Administrative Agent an amount equal to the aggregate then undrawn and unexpired
amount of such Letters of Credit in accordance with the provisions of subsection
4.8. Amounts held in such cash collateral account shall be applied by the
Administrative Agent to the payment of drafts drawn under such Letters of
Credit, and the unused portion thereof after all such Letters of Credit shall
have expired or been fully drawn upon, if any, shall be applied to repay other
then due and owing Obligations. After all such Letters of Credit shall have
expired or been fully drawn upon, all Reimbursement Obligations shall have been
satisfied and all other Obligations shall have been paid in full (or in the
event that the acceleration that required the funding of such cash collateral
account is rescinded by the Lenders), the balance, if any, in such cash
collateral account shall be returned to the Borrower (or such other Person as
may be lawfully entitled thereto). The Borrower hereby expressly waives
presentment, demand of payment, protest and all notices whatsoever (other than
any notices specifically required hereby).
70
Section 10. THE ADMINISTRATIVE AGENT
10.1 APPOINTMENT
-----------
Each Lender hereby irrevocably designates and appoints the
Administrative Agent as the Administrative Agent of such Lender under this
Agreement and the other Loan Documents, and each Lender irrevocably authorizes
the Administrative Agent, in such capacity, to take such action on its behalf
under the provisions of this Agreement and the other Loan Documents and to
exercise such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent.
10.2 DELEGATION OF DUTIES
--------------------
The Administrative Agent may execute any of its duties under this
Agreement and the other Loan Documents by or through agents or attorneys-in-fact
and shall be entitled to advice of counsel concerning all matters pertaining to
such duties. The Administrative Agent shall not be responsible for the
negligence or misconduct of any agents or attorneys in-fact selected by it with
reasonable care.
10.3 EXCULPATORY PROVISIONS
----------------------
Neither the Administrative Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates shall be (i) liable for any
action lawfully taken or omitted to be taken by it or such Person under or in
connection with this Agreement or any other Loan Document (except for its or
such Person's own gross negligence or willful misconduct) or (ii) responsible in
any manner to any of the Lenders for any recitals, statements, representations
or warranties made by the Borrower or any officer thereof contained in this
Agreement or 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
for the value, validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Loan Document or for any failure of
the Borrower to perform its obligations hereunder or thereunder. The
Administrative Agent shall not be under any obligation to any Lender 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 the Borrower.
10.4 RELIANCE BY ADMINISTRATIVE AGENT
--------------------------------
The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any Note, writing, resolution, notice, consent,
certificate, affidavit, letter, telecopy, telex or teletype message, statement,
71
order or other document or conversation believed by it to be genuine and correct
and to have been signed, sent or made by the proper Person or Persons and upon
advice and statements of legal counsel (including, without limitation, counsel
to the Borrower), independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent may deem and treat the payee of
any Note as the owner thereof for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed with the
Administrative Agent. The Administrative Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Loan
Document unless it shall first receive such advice or concurrence of the
Majority Lenders (or, to the extent required by this Agreement, all of the
Lenders) as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action
(other than any such liability or expense resulting from the gross negligence or
willful misconduct of the Administrative Agent). The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, under
this Agreement and the other Loan Documents in accordance with a request of the
Majority Lenders (or, to the extent required by this Agreement, all of the
Lenders), and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Lenders and all future holders of the
Loans.
10.5 NOTICE OF DEFAULT
-----------------
The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or the Borrower referring
to this Agreement, describing such Default or Event of Default and stating that
such notice is a "notice of default". In the event that the Administrative Agent
receives such a notice, the Administrative Agent shall give notice thereof to
the Lenders. The Administrative Agent shall take such action with respect to
such Default or Event of Default as shall be reasonably directed by the Majority
Lenders (or, to the extent required by this Agreement, all of the Lenders);
PROVIDED that unless and until the Administrative Agent shall have received such
directions, the Administrative Agent may (but shall not be obligated to) take
such action, or refrain from taking such action, with respect to such Default or
Event of Default as it shall deem advisable in the best interests of the
Lenders.
72
10.6 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS
------------------------------------------------------
Each Lender expressly acknowledges that neither the Administrative
Agent nor any of its officers, directors, employees, agents, attorneys-in-fact
or Affiliates has made any representations or warranties to it and that no act
by the Administrative Agent hereafter taken, including any review of the affairs
of the Borrower, shall be deemed to constitute any representation or warranty by
the Administrative Agent to any Lender. Each Lender represents to the
Administrative Agent that it has, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Borrower and made its own decision to make
its Loans hereunder and enter into this Agreement. Each Lender also represents
that it will, independently and without reliance upon the Administrative Agent
or any other Lender, and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigation as it deems necessary
to inform itself as to the business, operations, property, financial and other
condition and creditworthiness of the Borrower. Except for notices, reports and
other documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of the Borrower which may come into
the possession of the Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.
10.7 INDEMNIFICATION
---------------
The Lenders agree to indemnify the Administrative Agent in its
capacity as such (to the extent not reimbursed by the Borrower in accordance
with the terms hereof and without limiting the obligation of the Borrower to do
so), ratably according to their respective Revolving Credit Commitment
Percentages in effect on the date on which indemnification is sought (or, if
indemnification is sought after the date upon which the Commitments shall have
terminated and the Loans shall have been paid in full, ratably in accordance
with such percentages immediately prior to such date), from and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind whatsoever which may at any
time (including, without limitation, at any time following the payment of the
Loans) be imposed on, incurred by or asserted against the Administrative Agent
in any way relating to or arising out of, the Commitments, this Agreement, any
of the other Loan Documents or any documents contemplated by or referred to
herein or therein or the transactions contemplated hereby or thereby or any
action taken or omitted by the Administrative Agent under or in connection with
any of the foregoing; PROVIDED that no Lender shall be liable for the payment of
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements which are found by a
final and nonappealable decision of a court of competent jurisdiction to have
resulted from the Administrative Agent's gross negligence or willful misconduct.
The agreements in this subsection shall survive the payment of the Loans and all
other amounts payable hereunder. Notwithstanding anything contained herein to
73
the contrary, the Issuing Lender and Swingline Lender shall have all of the
benefits and immunities (a) provided to the Administrative Agent in this Section
10 with respect to any acts taken or omissions suffered by the Issuing Lender or
Swingline Lender, as the case may be, as fully as if the term "Administrative
Agent" as used in this Section 10 included the Issuing Lender and Swingline
Lender with respect to such acts or omissions, and (b) as additionally provided
herein with respect to the Issuing Lender and Swingline Lender, as the case may
be.
10.8 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY
-----------------------------------------------
The Person serving as the Administrative Agent and its Affiliates may
make loans to, accept deposits from and generally engage in any kind of business
with the Borrower as though the Person serving as the Administrative Agent were
not the Administrative Agent hereunder and under the other Loan Documents. With
respect to the Loans made by it and with respect to any Letter of Credit issued
or participated in by it, the Person serving as the Administrative Agent shall
have the same rights and powers under this Agreement and the other Loan
Documents as any Lender and may exercise the same as though it were not the
Administrative Agent, and the terms "Lender" and "Lenders" shall include the
Person serving as the Administrative Agent in its individual capacity.
10.9 SUCCESSOR ADMINISTRATIVE AGENT
------------------------------
The Administrative Agent may resign as Administrative Agent upon 10
days' notice to the Lenders and the Borrower provided that any such resignation
by JPMCB shall also constitute its resignation as Issuing Lender and Swingline
Lender. If the Administrative Agent shall resign as Administrative Agent under
this Agreement and the other Loan Documents, then the Majority Lenders shall
appoint from among the Lenders a successor Administrative Agent for the Lenders,
which successor Administrative Agent (provided that it shall have been approved
by the Borrower), shall succeed to the rights, powers and duties of the
Administrative Agent hereunder. Effective upon such appointment and approval,
the term "Administrative Agent" shall mean such successor Administrative Agent,
and the former Administrative Agent's rights, powers and duties as
Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Administrative Agent or any of the parties to
this Agreement or any holders of the Loans. After any retiring Administrative
Agent's resignation as Administrative Agent, the provisions of this Section 10
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement and the other Loan
Documents.
10.10 THE SOLE LEAD ARRANGER, THE SOLE BOOKRUNNER AND THE SYNDICATION
-----------------------------------------------------------------
AGENT
- -----
None of the Sole Lead Arranger, the Sole Bookrunner or the Syndication
Agent shall have any right, power, obligation, liability, responsibility or duty
under this Agreement other than those applicable to all Lenders as such. Without
limiting the foregoing, none of the Sole Lead Arranger, the Sole Bookrunner or
the Syndication Agent shall have or be deemed to have any fiduciary relationship
with any Lender. Each Lender acknowledges that it has not relied, and will not
74
rely, on the Sole Lead Arranger, the Sole Bookrunner or the Syndication Agent in
deciding to enter into this Agreement or in taking or not taking any action
hereunder.
Section 11. MISCELLANEOUS
11.1 AMENDMENTS AND WAIVERS
----------------------
(a) Except as provided in subsection 11.1(b), neither this Agreement
nor any other Loan Document, nor any terms hereof or thereof, may be amended,
supplemented or modified except in accordance with the provisions of this
subsection. The Majority Lenders may, or, with the written consent of the
Majority Lenders, the Administrative Agent may, from time to time, (a) enter
into with the Borrower written amendments, supplements or modifications hereto
and to the other Loan Documents for the purpose of adding any provisions to this
Agreement or the other Loan Documents or changing in any manner the rights of
the Lenders or of the Borrower hereunder or thereunder or (b) waive, on such
terms and conditions as the Majority Lenders or the Administrative Agent, as the
case may be, may specify in such instrument, any of the requirements of this
Agreement or the other Loan Documents or any Default or Event of Default and its
consequences; PROVIDED, HOWEVER, that no such waiver and no such amendment,
supplement or modification shall (i) reduce the amount or extend the scheduled
date of maturity of any Loan, or reduce the stated rate or amount of any
interest or fee payable hereunder or extend the scheduled date of any payment
thereof or increase the amount or extend the expiration date of any Lender's
Multicurrency Commitment, Revolving Credit Commitment, Swingline Commitment or
L/C Commitment, in each case without the consent of each Lender affected
thereby, or (ii) amend, modify or waive any provision of this subsection, reduce
the percentage specified in the definitions of Majority Leaders, or amend or
modify any other provision hereof specifying the number or percentage of Lenders
required to waive, amend or modify any rights hereunder or make any
determination granting consent hereunder, or consent to the assignment or
transfer by the Borrower or any Guarantor of any of its rights and obligations
under this Agreement and the other Loan Documents, in each case without the
written consent of all the Lenders, (iii) release any Guarantor from its
obligations or limit any of such Guarantor's obligations under Section 12
(except where such release is expressly permitted elsewhere in this Agreement
without such consent) without the written consent of all the Lenders, or (iv)
(A) amend, modify or waive any provision of Section 10 without the written
consent of the then Administrative Agent, (B) affect the rights or duties of the
Issuing Lender under this Agreement or any other Loan Document without the
written consent of the then Issuing Lender or (C) affect the rights or duties of
Swingline Lender under this Agreement or any other Loan Document without the
written consent of then Swingline Lender; and further PROVIDED, HOWEVER, that no
such waiver and no such amendment, supplement or modification shall amend,
modify or waive any provision of Section 12 without the written consent of the
Guarantors . Any such waiver and any such amendment, supplement or modification
shall apply equally to each of the Lenders and shall be binding upon the
Borrower, the Guarantors, the Lenders, the Administrative Agent and all future
holders of the Loans. In the case of any waiver, the Borrower, the Guarantors,
the Lenders and the Administrative Agent shall be restored to their former
positions and rights hereunder and under the other Loan Documents, and any
Default or Event of Default waived shall be deemed to be cured and not
continuing; no such waiver shall extend to any subsequent or other Default or
Event of Default or impair any right consequent thereon.
75
(b) In addition to amendments effected pursuant to the foregoing
paragraph (a), additional freely-convertible eurocurrencies may be added as
Available Foreign Currencies, upon execution and delivery by the Borrower, the
Administrative Agent and all of the Lenders of an amendment providing for such
addition. The Administrative Agent shall give prompt written notice to each
Lender of any such amendment.
11.2 NOTICES
-------
(a) Except in the case of notices and other communications expressly
permitted to be given by telephone (and subject to paragraph (b) below), all
notices and other communications provided for herein shall be in writing and
shall be delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
(i) if to the Borrower or any of the Guarantors, to Henry Schein,
Inc., 135 Duryea Road, Melville, New York, 11747, Attention of Chief
Financial Officer (Telecopy No. (631) 843-5541), with a copy to
Proskauer Rose LLP, 1585 Broadway, New York, New York, 10036-8299,
Attention of Jack P. Jackson, Esq. (Telecopy No. (212) 969-2900);
(ii) if to the Administrative Agent, to it at JPMorgan Chase
Bank, 395 North Service Road, Suite 302, Melville, NY 11747, Attention
of John Budzynski, (Telecopy No. (631) 755-5184), with a copy to
Barbara Bertschi;
(iii) if to the Issuing Lender, to it at JPMorgan Chase Bank,
10420 Highland Manor Drive-BL 2, Floor 4, Tampa, FL 33610, Attention
of Joseph Borello (Telecopy No. (813) 432-5161);
(iv) if to the Swingline Lender, to it at JPMorgan Chase Bank, 1
Chase Manhattan Plaza, New York, NY 10081, Attention of Mo-Lin Sum
(Telecopy No. (212) 552-5650); and
(v) if to any other Lender, to it at its address (or telecopy
number) set forth in its Administrative Questionnaire and notified to
the Borrower in accordance with the provisions hereof.
(b ) Notices and other communications to the Lenders hereunder may be
delivered or furnished by electronic communications pursuant to procedures
approved by the Administrative Agent and the Lenders; provided that the
foregoing shall not apply to notices pursuant to subsection 2.4 or Section 4
unless otherwise agreed by the Administrative Agent and the applicable Lender.
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) Any party hereto may change its address or telecopy number for
notices and other communications hereunder by notice to the other parties
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hereto. All notices and other communications given to any party hereto in
accordance with the provisions of this Agreement shall be deemed to have been
given on the date of receipt.
11.3 NO WAIVER; CUMULATIVE REMEDIES
------------------------------
No failure to exercise and no delay in exercising, on the part of the
Administrative Agent or any Lender, any right, remedy, power or privilege
hereunder or under the other Loan Documents 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.
11.4 SURVIVAL OF REPRESENTATIONS AND WARRANTIES
------------------------------------------
All representations and warranties made hereunder, in the other Loan
Documents and in any document, certificate or statement delivered pursuant
hereto or in connection herewith shall survive the execution and delivery of
this Agreement and the making of the Loans hereunder.
11.5 PAYMENT OF EXPENSES AND TAXES
-----------------------------
The Borrower agrees (a) to pay or reimburse the Administrative Agent
for all its reasonable out-of-pocket costs and expenses incurred in connection
with the development, preparation and execution of, and any amendment,
supplement or modification to, this Agreement and the other Loan Documents and
any other documents prepared in connection herewith or therewith, and the
consummation and administration of the transactions contemplated hereby and
thereby, including, without limitation, the reasonable fees and disbursements of
Rivkin Radler LLP, counsel to the Administrative Agent, (b) to pay or reimburse
each Lender and the Administrative Agent for all its costs and expenses incurred
in connection with the enforcement of any rights under this Agreement or any of
the other Loan Documents, including, without limitation, the Attorney Costs of
each Lender and of the Administrative Agent, (c) to pay, and indemnify and hold
harmless each Lender and the Administrative Agent and each of their affiliates
and their respective officer, directors, employees, Administrative Agents and
advisors (each, an "INDEMNIFIED PARTY") from, any and all recording and filing
fees and any and all liabilities with respect to, or resulting from any delay in
paying, stamp, excise and other taxes, if any, which may be payable or
determined to be payable in connection with the execution and delivery of, or
consummation or administration of any of the transactions contemplated by, or
any amendment, supplement or modification of, or any waiver or consent under or
in respect of, this Agreement, the other Loan Documents and any such other
documents, PROVIDED that the Borrower shall have no obligation hereunder to any
indemnified party with respect to any of the foregoing fees or liabilities which
arise from the gross negligence or willful misconduct of such indemnified party
determined in a court of competent jurisdiction in a final non-appealable
judgment, and (d) to pay, and indemnify and hold harmless each indemnified party
from and against, any and all other liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
77
kind or nature whatsoever with respect to the execution, delivery, enforcement,
performance and administration of this Agreement, the other Loan Documents
including, without limitation, any of the foregoing relating to the violation
of, noncompliance with, or liability under, any Environmental Law applicable to
the operations of the Borrower, any of its Subsidiaries or any of the Properties
(all the foregoing in this clause (d), collectively, the "indemnified
liabilities"), PROVIDED that the Borrower shall have no obligation hereunder to
any indemnified party with respect to indemnified liabilities arising from the
gross negligence or willful misconduct of such indemnified party determined in a
court of competent jurisdiction in a final non-appealable judgment. The
agreements in this subsection shall survive the termination of this Agreement
and each other Loan Document and repayment of the Loans and all other amounts
payable hereunder.
11.6 SUCCESSORS AND ASSIGNS; PARTICIPATIONS AND ASSIGNMENTS
------------------------------------------------------
(a) The provisions of this Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and assigns
permitted hereby (including any Affiliate of the Issuing Lender that issues any
Letter of Credit), except that (i) neither the Borrower nor any of the
Guarantors may assign or otherwise transfer any of their respective rights or
obligations hereunder without the prior written consent of each Lender (and any
attempted assignment or transfer by any such Person without such consent shall
be null and void) and (ii) no Lender may assign or otherwise transfer its rights
or obligations hereunder except in accordance with this subsection. Nothing in
this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and assigns
permitted hereby (including any Affiliate of the Issuing Lender that issues any
Letter of Credit), Participants (to the extent provided in paragraph (c) of this
subsection) and, to the extent expressly contemplated hereby, the Related
Parties of each of the Administrative Agent, the Issuing Lender, the Swingline
Lender and the Lenders) any legal or equitable right, remedy or claim under or
by reason of this Agreement.
(b) (i) Subject to the conditions set forth in paragraph (b)(ii)
below, any Lender may assign to one or more assignees (each, an "Assignee") all
or a portion of its rights and obligations under this Agreement (including all
or a portion of its Revolving Credit Commitment and the Loans at the time owing
to it) with the prior written consent (such consent not to be unreasonably
withheld) of:
(A) the Borrower, PROVIDED that no consent of the
Borrower shall be required for an assignment to a
Lender, an Affiliate of a Lender, an "Approved
Fund" (as defined below) or, if a Default or an
Event of Default has occurred and is continuing,
any other Assignee; and
(B) the Administrative Agent, PROVIDED that no consent
of the Administrative Agent shall be required for
an assignment to an Assignee that is a Lender
immediately prior to giving effect to such
assignment.
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(ii) Assignments shall be subject to the following additional
conditions:
(A) except in the case of an assignment to a Lender or
an Affiliate of a Lender or an assignment of the
entire remaining amount of the assigning Lender's
Revolving Credit Commitment, the amount of the
Revolving Credit Commitment of the assigning
Lender subject to each such assignment (determined
as of the date the Assignment and Acceptance,
substantially in the form of Exhibit I
(hereinafter, an "Assignment and Acceptance"),
with respect to such assignment is delivered to
the Administrative Agent) shall not be less than
$5,000,000 unless each of the Borrower and the
Administrative Agent otherwise consent, PROVIDED
that no such consent of the Borrower --------
shall be required if a Default or an Event of
Default has occurred and is continuing;
(B) 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:
(C) the parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment
and Acceptance, together with a processing and
recordation fee of $3,500;
(D) the Assignee, if it shall not be a Lender, shall
deliver to the Administrative Agent a duly
completed administrative questionnaire (containing
all pertinent information relating to such
assignee; hereinafter an "Administrative
Questionnaire"); and
(E) in the case of an assignment to a "CLO" (as
defined below), the assigning Lender shall retain
the sole right to approve any amendment,
modification or waiver of any provision of this
Agreement, PROVIDED that the Assignment and
Acceptance between such Lender and such CLO may
provide that such Lender will not, without the
consent of such CLO, agree to any amendment,
modification or waiver described in the first
proviso to subsection 11.1(a) that affects such
CLO.
For the purposes of this subsection 11.6(b), the terms "Approved Fund"
and "CLO" have the following meanings:
79
"APPROVED FUND" means (a) a CLO and (b) with respect to any Lender
that is an institutional fund which invests primarily in bank loans and similar
extensions of credit, any other institutional fund that invests primarily in
bank loans and similar extensions of credit and is managed by the same
investment advisor as such Lender or by an Affiliate of such investment advisor.
"CLO" means any entity (whether a corporation, partnership, trust or
otherwise) that is engaged in making, purchasing, holding or otherwise investing
in bank loans and similar extensions of credit in the ordinary course of its
business and is administered or managed by a Lender or an Affiliate of such
Lender.
(iii) Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) of this subsection, from and after the effective
date specified in each Assignment and Acceptance the assignee
thereunder shall be a party hereto and, to the extent of the interest
assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such
Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering
all of the assigning Lender's rights and obligations under this
Agreement, such Lender shall cease to be a party hereto but shall
continue to be entitled to the benefits of subsections 3.8, 3.9, 3.10,
3.11 and 11.5). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this
subsection 11.6 shall be treated for purposes of this Agreement as a
sale by such Lender of a participation in such rights and obligations
in accordance with paragraph (c) of this subsection.
(iv) The Administrative Agent, acting for this purpose as an
agent of the Borrower, shall maintain at one of its offices a copy of
each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the
Revolving Credit Commitment of, and principal amount of the Loans
owing to, each Lender pursuant to the terms hereof from time to time
(the "REGISTER"). The entries in the Register shall be conclusive in
the absence of manifest error, and the Borrower, the Administrative
Agent, the Issuing Lender, the Swingline Lender and the Lenders may
treat each Person whose name is recorded in the Register pursuant to
the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary. The Register shall
be available for inspection by the Borrower, the Issuing Lender, the
Swingline Lender and any Lender, at any reasonable time and from time
to time upon reasonable prior notice.
(v) Upon its receipt of a duly completed Assignment and
Acceptance executed by an assigning Lender and an Assignee, the
Assignee's completed Administrative Questionnaire (unless the Assignee
shall already be a Lender hereunder), the processing and recordation
fee referred to in paragraph (b) of this subsection and any written
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consent to such assignment required by paragraph (b) of this
subsection, the Administrative Agent shall accept such Assignment and
Acceptance and record the information contained therein in the
Register. No assignment shall be effective for purposes of this
Agreement unless it has been recorded in the Register as provided in
this paragraph.
(c) (i) Any Lender may, without the consent of the Borrower, the
Administrative Agent, the Issuing Bank or the Swingline Lender, sell
participations to one or more banks or other entities (a "PARTICIPANT") in all
or a portion of such Lender's rights and obligations under this Agreement
(including all or a portion of its Revolving Credit Commitment and the Loans
owing to it); PROVIDED that (A) such Lender's obligations under this Agreement
shall remain unchanged, (B) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations and (C) the
Borrower, the Administrative Agent, the Issuing Lender, the Swingline Lender and
the other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement. 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, modification or waiver described in the first proviso to subsection
11.1(a) that affects such Participant. Subject to paragraph (c)(ii) of this
subsection, the Borrower agrees that each Participant shall be entitled to the
benefits of subsections 3.8, 3.9, 3.10 and 3.11 to the same extent as if it were
a Lender and had acquired its interest by assignment pursuant to paragraph (b)
of this subsection. To the extent permitted by law, each Participant also shall
be entitled to the benefits of subsection 11.7 as though it were a Lender,
provided such Participant agrees to be subject to subsection 11.7 as though it
were a Lender.
(ii) A Participant shall not be entitled to receive any greater
payment under subsection 3.9, 3.10 or 3.11 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
Non-U.S. Lender (as defined in subsection 3.10(b)) if it were a Lender shall not
be entitled to the benefits of subsection 3.10 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 subsection 3.10(b) as though it were
a Lender.
(d) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations of
such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this subsection shall not apply to any such pledge or
assignment of a security interest; PROVIDED that no such pledge or assignment of
a security interest shall release a Lender from any of its obligations hereunder
or substitute any such pledgee or assignee for such Lender as a party hereto.
(e) The Borrower authorizes each Lender to disclose to any Participant
or Assignee (each, a "TRANSFEREE") and any prospective Transferee, subject to
the provisions of subsection 11.14, any and all financial information in such
Lender's possession concerning the Borrower and its Subsidiaries and Affiliates
which has been delivered to such Lender by or on behalf of the Borrower pursuant
81
to this Agreement or which has been delivered to such Lender by or on behalf of
the Borrower in connection with such Lender's credit evaluation of such Borrower
and its Subsidiaries and Affiliates prior to becoming a party to this Agreement.
(f) For avoidance of doubt, the parties to this Agreement acknowledge
that the provisions of this subsection concerning assignments of Loans and Notes
relate only to absolute assignments and that such provisions do not prohibit
assignments creating security interests, including, without limitation, any
pledge or assignment by a Lender of any Loan or Note to any Federal Reserve Bank
in accordance with applicable law.
11.7 ADJUSTMENTS; SET-OFF
--------------------
(a) If any Lender (a "BENEFITED LENDER") shall at any time receive any
payment of all or part of its Loans or the Reimbursement Obligations owing to it
then due and owing, or interest thereon, or receive any collateral in respect
thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or
proceedings of the nature referred to in subsection 9(e), or otherwise), in a
greater proportion than any such payment to or collateral received by any other
Lender (other than to the extent expressly provided herein), if any, in respect
of such other Lender's Loans or the Reimbursement Obligations owing to it then
due and owing, or interest thereon, such benefited Lender shall purchase for
cash from the other Lenders a participating interest in such portion of each
such other Lender's Loans or the Reimbursement Obligations owing to it, or shall
provide such other Lenders with the benefits of any such collateral, or the
proceeds thereof, as shall be necessary to cause such benefited Lender to share
the excess payment or benefits of such collateral or proceeds ratably with each
of the other Lenders; PROVIDED, HOWEVER, that if all or any portion of such
excess payment or benefits is thereafter recovered from such benefited Lender,
such purchase shall be rescinded, and the purchase price and benefits returned,
to the extent of such recovery, but without interest.
(b) In addition to any rights and remedies of the Lenders provided by
law, each Lender shall have the right, without prior notice to the Borrower or
the Guarantors, any such notice being expressly waived by the Borrower and the
Guarantors to the extent permitted by applicable law, upon any amount becoming
due and payable by the Borrower hereunder (whether at the stated maturity, by
acceleration or otherwise) to set off and appropriate and apply against such
amount any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by such Lender or any branch or
agency thereof to or for the credit or the account of the Borrower or any of the
Guarantors. Each Lender agrees promptly to notify the Borrower or any such
Guarantor and the Administrative Agent after any such set-off and application
made by such Lender, PROVIDED that the failure to give such notice shall not
affect the validity of such set-off and application.
11.8 COUNTERPARTS
------------
This Agreement may be executed by one or more of the parties to this
Agreement on any number of separate counterparts (including by facsimile
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transmission), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. A set of the copies of this Agreement
signed by all the parties shall be lodged with the Borrower and the
Administrative Agent.
11.9 SEVERABILITY
------------
Any provision of this Agreement which is prohibited or unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
11.10 INTEGRATION
------------
This Agreement and the other Loan Documents represent the entire
agreement of the Borrower, the Administrative Agent and the Lenders with respect
to the subject matter hereof or thereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof or thereof not expressly set forth or
referred to herein or in the other Loan Documents.
11.11 GOVERNING LAW
--------------
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW
OF THE STATE OF NEW YORK.
11.12 SUBMISSION TO JURISDICTION; WAIVERS
------------------------------------
Each of the Borrower and each Guarantor hereby irrevocably and
unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the courts of the State of
New York, the courts of the United States of America for the Southern District
of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage prepaid, to the Borrower at its
address set forth in subsection 11.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;
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(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the right
to sue in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to in
this subsection any special, exemplary, punitive or consequential damages.
11.13 ACKNOWLEDGEMENTS
----------------
Each of the Borrower and each Guarantor hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;
(b) neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duty to the Borrower or any of the Guarantors arising out
of or in connection with this Agreement or any of the other Loan Documents, and
the relationship between Administrative Agent and Lenders, on the one hand, and
the Borrower and the Guarantors, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Loan Documents
or otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Borrower, the Guarantors, and the Lenders.
11.14 CONFIDENTIALITY
---------------
Each Lender agrees to keep confidential any written or oral
information (a) provided to it by or on behalf of the Borrower or any of its
Subsidiaries pursuant to or in connection with this Agreement or any other Loan
Document or (b) obtained by such Lender based on a review of the books and
records of the Borrower or any of its Subsidiaries; PROVIDED that nothing herein
shall prevent any Lender from disclosing any such information (i) to the
Administrative Agent, the Issuing Lender or any other Lender, (ii) to any
Transferee which receives such information having been made aware of the
confidential nature thereof and having agreed to abide by the provisions of this
subsection 11.14, (iii) to its employees, directors, agents, attorneys,
accountants and other professional advisors, and to employees and officers of
its Affiliates who agree to be bound by the provisions of this subsection 11.14
and who have a need for such information in connection with this Agreement or
other transactions or proposed transactions with the Borrower, (iv) upon the
request or demand of any Governmental Authority having jurisdiction over such
Lender, (v) in response to any order of any court or other Governmental
Authority or as may otherwise be required pursuant to any Requirement of Law,
(vi) subject to an agreement to comply with the provisions of this subsection,
to any actual or prospective counter-party (or its advisors) to any Swap
Agreement, (vii) which has been publicly disclosed other than in breach of this
Agreement, (viii) in connection with the exercise of any remedy hereunder or any
litigation to which such Lender is a party, or (ix) which is received by such
Lender from a Person who, to such Lender's knowledge or reasonable belief, is
not under a duty of confidentiality to the Borrower or the applicable
Subsidiary, as the case may be.
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11.15 JUDGMENT
--------
The Borrower, the Administrative Agent and each Lender hereby agree
that if, in the event that a judgment is given, in relation to any sum due the
Administrative Agent or any Lender hereunder, in an Available Foreign Currency
(the "Judgment Currency"), the Borrower agrees to indemnify the Administrative
Agent or such Lender, as the case may be, to the extent that the Dollar
Equivalent amount which could have been purchased on the Business Day following
receipt of such sum is less than the sum which could have been so purchased by
the Administrative Agent had such purchase been made on the day on which such
judgment was given or, if such day is not a Business Day, on the Business Day
immediately preceding the giving of such judgment, and if the amount so
purchased exceeds the amount which could have been so purchased had such
purchase been made on the day on which such judgment was given or, if such day
is not a Business Day, on the Business Day immediately preceding such judgment,
the Administrative Agent or the applicable Lender agrees to remit such excess to
the Borrower. The agreements in this subsection shall survive the termination of
this Agreement and each other Loan Document and the payment of the Loans and all
other Obligations.
11.16 WAIVERS OF JURY TRIAL
---------------------
THE BORROWER, THE GUARANTORS, THE ADMINISTRATIVE AGENT, THE ISSUING
LENDER, THE SWINGLINE LENDER AND THE LENDERS HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
Section 12. GUARANTEE
12.1 GUARANTEE
---------
The Guarantors hereby jointly and severally guarantee (this
"Guarantee") to each Lender, the Swingline Lender, the Issuing Lender and the
Administrative Agent, and their respective successors and assigns, the prompt
payment in full when due (whether at stated maturity, by acceleration or
otherwise) of the principal of and interest on the Loans made by the Lenders to
the Borrower and all other amounts from time to time owing to the Lenders, the
Swingline Lender, the Issuing Lender or the Administrative Agent by the Borrower
under this Agreement or under any of the other Loan Documents, in each case
strictly in accordance with the terms hereof or thereof, as the case may be
(such obligations being herein collectively called the "GUARANTEED
OBLIGATIONS"). The Guarantors hereby further jointly and severally agree that if
the Borrower shall fail to pay in full when due (whether at stated maturity, by
acceleration or otherwise) any of the Guaranteed Obligations, the Guarantors
will 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 Guaranteed
Obligations, the same will be promptly paid in full when due (whether at
extended maturity, by acceleration or otherwise) in accordance with the terms of
such extension or renewal. This Guarantee is an absolute, unconditional,
85
continuing guaranty of payment and not of collection of the Guaranteed
Obligations and includes Guaranteed Obligations arising from successive
transactions which shall either continue such Guaranteed Obligations or from
time to time renew such Guaranteed Obligations after the same have been
satisfied. This Guarantee is in no way conditioned upon any attempt to collect
from the Borrower or upon any other event or contingency, and shall be binding
upon and enforceable against each Guarantor without regard to the validity or
enforceability of any of the Guaranteed Obligations, this Agreement, the Notes
or any other Loan Document or of any term hereof or thereof. Each Lender, and
each of the Swingline Lender, the Issuing Lender and the Administrative Agent,
is hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other indebtedness at
any time owing by such Lender, the Swingline Lender, the Issuing Lender or the
Administrative Agent to or for the credit or the account of any Guarantor
against any of the obligations of any Guarantor now or hereafter existing under
this Guarantee, irrespective of whether or not any such Lender, the Swingline
Lender, the Issuing Lender or the Administrative Agent shall have made any
demand hereunder and although such obligations may be unmatured. The rights
under this subsection 12.1 are in addition to other rights and remedies
(including other rights of set off) which any Lender, the Swingline Lender, the
Issuing Lender or the Administrative Agent may have.
12.2 OBLIGATIONS UNCONDITIONAL
-------------------------
The obligations of the Guarantors under subsection 12.1 are absolute
and unconditional, joint and several, irrespective of the value, genuineness,
validity, regularity or enforceability of the obligations of the Borrower under
this Agreement or any other agreement or instrument referred to herein, or any
substitution, release or exchange of any other guarantee of or security for any
of the Guaranteed Obligations, and, to the fullest extent permitted by
applicable law, irrespective of any other circumstance whatsoever that might
otherwise constitute a legal or equitable discharge or defense of a surety or
guarantor, it being the intent of this subsection that the obligations of the
Guarantors hereunder shall be absolute and unconditional, joint and several, and
shall not be subject to any counterclaim, set-off, deduction or defense based
upon any claim any Guarantor may have against any Person, under any and all
circumstances. Without limiting the generality of the foregoing, it is agreed
that the occurrence of any one or more of the following shall not alter or
impair the liability of the Guarantors hereunder, which shall remain absolute
and unconditional as described above:
(i) at any time or from time to time, without notice to the
Guarantors, the time for any performance of or compliance with any of the
Guaranteed Obligations shall be extended, or such performance or compliance
shall be waived;
(ii) any of the acts mentioned in any of the provisions of this
Agreement or any other agreement or instrument referred to herein shall be
done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall be
accelerated, or any of the Guaranteed Obligations shall be modified,
supplemented or amended in any respect, or any right under this Agreement
or any other agreement or instrument referred to herein shall be waived or
any other guarantee of any of the Guaranteed Obligations or any security
86
therefor shall be released or exchanged in whole or in part or otherwise
dealt with;
(iv) any lien or security interest granted to, or in favor of, the
Administrative Agent, the Swingline Lender, the Issuing Lender or any
Lender or Lenders as security for any of the Guaranteed Obligations shall
fail to be perfected or shall be impaired or shall be released, or any
Person liable for any of the Guaranteed Obligations (including, without
limitation, any Guarantor) shall be released;
(v) any express or implied amendment, modification or supplement to
this Agreement, any Note, or any other instrument applicable to the
Borrower or to the Loans, or the Letters of Credit or any part thereof;
(vi) any failure on the part of the Borrower to perform or comply with
this Agreement, any Note or any other Loan Document or any failure of any
other Person to perform or comply with any term of this Agreement, any
Note, or any other Loan Document or any other agreement as aforesaid; or
(vii) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or similar proceeding with respect
to the Borrower, or its properties or its creditors, or any action taken by
any trustee or receiver or by any court in any such proceeding.
The Guarantors hereby expressly waive diligence, presentment, demand of payment,
protest and all notices whatsoever, and any requirement that the Administrative
Agent, the Swingline Lender, the Issuing Lender or any Lender exhaust any right,
power or remedy or proceed against the Borrower under this Agreement or any
other agreement or instrument referred to herein, or against any other Person
under any other guarantee of, or security for, any of the Guaranteed
Obligations.
12.3 REINSTATEMENT
-------------
The obligations of the Guarantors under this Section shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of the Borrower or any Guarantor in respect of the Guaranteed
Obligations is rescinded or must be otherwise restored by any holder of any of
the Guaranteed Obligations, whether as a result of any proceedings in bankruptcy
or reorganization or otherwise, and the Guarantors jointly and severally agree
that they will indemnify the Administrative Agent, the Swingline Lender, the
Issuing Lender and each Lender on demand for all reasonable costs and expenses
(including fees of counsel) incurred by the Administrative Agent, the Swingline
Lender, the Issuing Lender 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.
12.4 SUBROGATION
-----------
87
The Guarantors hereby jointly and severally agree that until the
payment and satisfaction in full of all Guaranteed Obligations and the
expiration and termination of the Revolving Credit Commitments of the Lenders
under this Agreement, the Guarantors shall not exercise any right or remedy
arising by reason of any performance by them of their guarantee in subsection
12.1, whether by subrogation or otherwise, against the Borrower or any other
guarantor of any of the Guaranteed Obligations or any security for any of the
Guaranteed Obligations.
12.5 REMEDIES
--------
The Guarantors jointly and severally agree that, as between the
Guarantors and the Lenders, the obligations of the Borrower under this Agreement
may be declared to be forthwith due and payable as provided in Section 9 (and
shall be deemed to have become automatically due and payable as a result of the
occurrence of an event described in clause (e) or (i) of Section 9 in accordance
with the provisions of Section 9) for purposes of subsection 12.1
notwithstanding any stay, injunction or other prohibition preventing such
declaration (or such obligations from becoming automatically due and payable) as
against the Borrower , the obligations of the Guarantors with respect to the
Guaranteed Obligations shall be unaffected by any such stay, injunction or other
prohibition preventing such declaration (or such obligations from becoming
automatically due and payable) as against the Borrower or otherwise, and that,
in the event of such declaration (or such obligations being deemed to have
become automatically due and payable), such obligations (whether or not due and
payable by the Borrower) shall forthwith become due and payable by the
Guarantors for purposes of subsection 12.1.
12.6 INSTRUMENT FOR THE PAYMENT OF MONEY
-----------------------------------
Each Guarantor hereby acknowledges that the guarantee in this Section
constitutes an instrument for the payment of money, and consents and agrees that
any Lender, the Swingline Lender, the Issuing Lender or the Administrative
Agent, at its sole option, in the event of a dispute by such Guarantor in the
payment of any moneys due hereunder, shall have the right to bring motion or
action under New York CPLR Section 3213.
12.7 CONTINUING GUARANTEE
--------------------
The guarantee in this Section is a continuing guarantee, and shall
apply to all Guaranteed Obligations whenever arising.
12.8 GENERAL LIMITATION ON GUARANTEE OBLIGATIONS
-------------------------------------------
In any action or proceeding involving any state corporate law, or any
state or Federal bankruptcy, insolvency, reorganization or other law affecting
the rights of creditors generally, if the obligations of any Guarantors under
subsection 12.1 would otherwise be held or determined to be void, invalid or
unenforceable, or subordinated to the claims of any other creditors, on account
of the amount of its liability under subsection 12.1, then, notwithstanding any
other provision hereof to the contrary, the amount of such liability shall,
without any further action by such Guarantors, any Lender, the Administrative
88
Agent or any other Person, be automatically limited and reduced to the highest
amount that is valid and enforceable and not subordinated to the claims of other
creditors as determined in such action or proceeding.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.
BORROWER:
HENRY SCHEIN, INC.
By:
--------------------------------------------------
Name:
------------------------------------------------
Title:
-----------------------------------------------
GUARANTORS:
ROANE BARKER, INC.
By:
--------------------------------------------------
Name:
------------------------------------------------
Title:
-----------------------------------------------
DENTRIX DENTAL SYSTEMS, INC.
By:
--------------------------------------------------
Name:
------------------------------------------------
Title:
-----------------------------------------------
HSI SERVICE CORP.
By:
--------------------------------------------------
Name:
------------------------------------------------
Title:
-----------------------------------------------
MICRO BIO-MEDICS, INC.
89
By:
--------------------------------------------------
Name:
------------------------------------------------
Title:
-----------------------------------------------
GIV HOLDINGS, INC.
By:
--------------------------------------------------
Name:
------------------------------------------------
Title:
-----------------------------------------------
LENDERS:
JPMORGAN CHASE BANK,
as Administrative Agent, Issuing Lender, Swingline
Lender and as a Lender
By:
--------------------------------------------------
Name:
------------------------------------------------
Title:
-----------------------------------------------
FLEET NATIONAL BANK, as Syndication Agent and as a Lender
By:
-----------------------------------------------------------
Name:
---------------------------------------------------------
Title:
--------------------------------------------------------
CITIBANK N.A., as a Lender
By:
-----------------------------------------------------------
Name:
---------------------------------------------------------
Title:
--------------------------------------------------------
HSBC BANK USA, as a Lender
By:
-----------------------------------------------------------
Name:
---------------------------------------------------------
Title:
--------------------------------------------------------
MELLON BANK, N.A., as a Lender
By:
-----------------------------------------------------------
Name:
---------------------------------------------------------
Title:
--------------------------------------------------------
90
THE BANK OF NEW YORK, as a Lender
By:
-----------------------------------------------------------
Name:
---------------------------------------------------------
Title:
--------------------------------------------------------
WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender
By:
-----------------------------------------------------------
Name:
---------------------------------------------------------
Title:
--------------------------------------------------------
ISRAEL DISCOUNT BANK OF NEW YORK, as a Lender
By:
-----------------------------------------------------------
Name:
---------------------------------------------------------
Title:
--------------------------------------------------------
91
TABLE OF CONTENTS
PAGE
----
SECTION 1. DEFINITIONS.......................................................2
1.1 DEFINED TERMS....................................................2
1.2 OTHER DEFINITIONAL PROVISIONS...................................22
1.3 ROUNDING........................................................23
1.4 REFERENCES TO AGREEMENTS AND LAWS...............................23
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS..................................23
2.1 REVOLVING CREDIT COMMITMENTS....................................23
2.2 PROCEDURE FOR REVOLVING CREDIT BORROWING........................24
2.3 SWINGLINE COMMITMENT............................................25
2.4 PROCEDURE FOR SWINGLINE BORROWING; REFUNDING OF SWINGLINE LOANS.25
2.5 FEES............................................................27
2.6 TERMINATION OR REDUCTION OF COMMITMENTS.........................29
2.7 INCREASE IN COMMITMENTS.........................................29
2.8 REPAYMENT OF REVOLVING CREDIT LOANS.............................30
SECTION 3. CERTAIN PROVISIONS APPLICABLE TO THE LOANS.......................31
3.1 OPTIONAL AND MANDATORY PREPAYMENTS..............................31
3.2 CONVERSION AND CONTINUATION OPTIONS.............................32
3.3 MAXIMUM NUMBER OF TRANCHES......................................32
3.4 INTEREST RATES AND PAYMENT DATES................................32
3.5 COMPUTATION OF INTEREST AND FEES................................33
3.6 INABILITY TO DETERMINE INTEREST RATE............................34
3.7 PRO RATA TREATMENT AND PAYMENTS.................................34
3.8 ILLEGALITY......................................................35
3.9 REQUIREMENTS OF LAW.............................................36
3.10 TAXES...........................................................37
3.11 BREAK FUNDING PAYMENTS..........................................39
3.12 CHANGE OF LENDING OFFICE; REMOVAL OF LENDER.....................39
3.13 EVIDENCE OF DEBT................................................40
SECTION 4. LETTERS OF CREDIT................................................41
4.1 L/C COMMITMENT..................................................41
4.2 PROCEDURE FOR ISSUANCE OF LETTER OF CREDIT......................41
4.3 FEES AND OTHER CHARGES..........................................41
4.4 L/C PARTICIPATIONS..............................................42
4.5 REIMBURSEMENT OBLIGATION OF THE BORROWER........................43
4.6 OBLIGATIONS ABSOLUTE............................................44
4.7 LETTER OF CREDIT PAYMENTS.......................................44
4.8 CASH COLLATERALIZATION..........................................44
4.9 LETTER OF CREDIT RULES..........................................45
SECTION 5. REPRESENTATIONS AND WARRANTIES...................................45
5.1 FINANCIAL CONDITION.............................................45
5.2 NO CHANGE.......................................................46
5.3 CORPORATE EXISTENCE; COMPLIANCE WITH LAW........................46
5.4 CORPORATE POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS.........46
5.5 NO LEGAL BAR....................................................47
5.6 NO MATERIAL LITIGATION..........................................47
5.7 NO DEFAULT......................................................48
5.8 TAXES...........................................................48
5.9 PURPOSE OF LOANS................................................48
5.10 ENVIRONMENTAL MATTERS...........................................48
5.11 DISCLOSURE......................................................49
5.12 OWNERSHIP OF PROPERTY; LIENS....................................50
5.13 ERISA COMPLIANCE................................................50
5.14 SUBSIDIARIES....................................................51
5.15 MARGIN REGULATIONS; INVESTMENT COMPANY ACT; PUBLIC UTILITY
HOLDING COMPANY ACT.............................................51
SECTION 6. CONDITIONS PRECEDENT.............................................51
6.1 CONDITIONS TO INITIAL LOANS AND LETTERS OF CREDIT...............51
6.2 CONDITIONS TO EACH LOAN AND LETTER OF CREDIT....................53
SECTION 7. AFFIRMATIVE COVENANTS............................................54
7.1 FINANCIAL STATEMENTS............................................54
<page>
7.2 CERTIFICATES; OTHER INFORMATION.................................55
7.3 CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE................56
7.4 PAYMENT OF OBLIGATIONS..........................................56
7.5 MAINTENANCE OF PROPERTIES.......................................56
7.6 MAINTENANCE OF INSURANCE........................................57
7.7 BOOKS AND RECORDS...............................................57
7.8 INSPECTION RIGHTS...............................................57
7.9 COMPLIANCE WITH ERISA...........................................57
7.10 ENVIRONMENTAL COMPLIANCE........................................58
7.11 USE OF PROCEEDS.................................................58
7.12 NOTICES.........................................................58
7.13 ADDITIONAL GUARANTORS...........................................59
SECTION 8. NEGATIVE COVENANTS...............................................59
8.1 FINANCIAL COVENANTS.............................................59
8.2 LIMITATION ON LIENS.............................................60
8.3 LIMITATION ON INDEBTEDNESS......................................61
8.4 FUNDAMENTAL CHANGES.............................................61
8.5 DISPOSITIONS....................................................62
8.6 ERISA...........................................................63
8.7 SWAP AGREEMENTS.................................................63
8.8 CONDUCT OF BUSINESS.............................................63
8.9 TRANSACTIONS WITH AFFILIATES....................................63
8.10 BURDENSOME AGREEMENTS...........................................64
8.11 USE OF PROCEEDS.................................................64
8.12 ACQUISITIONS....................................................64
8.13 INVESTMENTS, LOANS, ADVANCES, GUARANTEES AND ACQUISITIONS.......65
8.14 RESTRICTED PAYMENTS.............................................66
SECTION 9. EVENTS OF DEFAULT................................................67
SECTION 10. THE ADMINISTRATIVE AGENT........................................71
10.1 APPOINTMENT.....................................................71
10.2 DELEGATION OF DUTIES............................................71
<page>
10.3 EXCULPATORY PROVISIONS..........................................71
10.4 RELIANCE BY ADMINISTRATIVE AGENT................................71
10.5 NOTICE OF DEFAULT...............................................72
10.6 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS..........73
10.7 INDEMNIFICATION.................................................73
10.8 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY.................74
10.9 SUCCESSOR ADMINISTRATIVE AGENT..................................74
10.10 THE SOLE LEAD ARRANGER, THE SOLE BOOKRUNNER AND THE
SYNDICATION AGENT...............................................74
SECTION 11. MISCELLANEOUS...................................................75
11.1 AMENDMENTS AND WAIVERS..........................................75
11.2 NOTICES.........................................................76
11.3 NO WAIVER; CUMULATIVE REMEDIES..................................77
11.4 SURVIVAL OF REPRESENTATIONS AND WARRANTIES......................77
11.5 PAYMENT OF EXPENSES AND TAXES...................................77
11.6 SUCCESSORS AND ASSIGNS; PARTICIPATIONS AND ASSIGNMENTS..........78
11.7 ADJUSTMENTS; SET-OFF............................................82
11.8 COUNTERPARTS....................................................82
11.9 SEVERABILITY....................................................83
11.10 INTEGRATION.....................................................83
11.11 GOVERNING LAW...................................................83
11.12 SUBMISSION TO JURISDICTION; WAIVERS.............................83
11.13 ACKNOWLEDGEMENTS................................................84
11.14 CONFIDENTIALITY.................................................84
11.15 JUDGMENT........................................................85
11.16 WAIVERS OF JURY TRIAL...........................................85
SECTION 12. GUARANTEE.......................................................85
12.1 GUARANTEE.......................................................85
12.2 OBLIGATIONS UNCONDITIONAL.......................................86
12.3 REINSTATEMENT...................................................87
12.4 SUBROGATION.....................................................87
12.5 REMEDIES........................................................88
<page>
12.6 INSTRUMENT FOR THE PAYMENT OF MONEY.............................88
12.7 CONTINUING GUARANTEE............................................88
12.8 GENERAL LIMITATION ON GUARANTEE OBLIGATIONS.....................88
SCHEDULES
Schedule I Names and Revolving Credit Commitments of Lenders
Schedule II Existing Letters of Credit
Schedule 8.13(e) Certain Investments, etc.
EXHIBITS
Exhibit A Form of Revolving Credit Loan Borrowing Notice
Exhibit B Form of Swingline Loan Borrowing Notice
Exhibit C Form of Assumption Agreement
Exhibit D Form of Exemption Certificate
Exhibit E Form of Revolving Credit Note
Exhibit F Form of Swingline Note
Exhibit G Form of Opinion of Counsel to Borrower and Guarantors
Exhibit H Form of Compliance Certificate
Exhibit I Form of Assignment and Acceptance
Exhibit J Form of Guarantee Assumption Agreement