EXHIBIT 10.377
ANNEX F (SECTION 6.10)
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TO
CREDIT AGREEMENT
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FINANCIAL COVENANTS
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Borrower shall not breach or fail to comply with any of the following financial
covenants, each of which shall be calculated in accordance with GAAP
consistently applied:
(a) Maximum Capital Expenditures. Borrower and its
Subsidiaries on a consolidated basis shall not make Capital Expenditures during
the following periods that exceed in the aggregate the amounts set forth
opposite each of such periods:
Period Maximum Capital Expenditures per Period
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Seven month period commencing
June 1, 2001 and ending on
December 31, 2001 $9,000,000
Fiscal Year 2002 $8,000,000
Fiscal Year 2003 $8,000,000
Six-month period commencing
January 1, 2004 and ending on
June 30, 2004 $5,000,000
(b) Minimum Fixed Charge Coverage Ratio. Borrower and its
Subsidiaries shall have on a consolidated basis at the end of each Fiscal
Quarter, commencing with the Fiscal Quarter ending December 31, 2001 and
continuing thereafter, a Fixed Charge Coverage Ratio for the 12-month period
then ended (or with respect to the Fiscal Quarters ending before September 30,
2002, the period commencing on October 1, 2001, and ending on the last day of
such Fiscal Quarter) of not less than 1.3:1.0.
(c) Minimum Interest Coverage Ratio. Borrower and its
Subsidiaries on a consolidated basis shall have at the end of each Fiscal
Quarter, commencing with the Fiscal Quarter ending December 31, 2001 and
continuing thereafter, an Interest Coverage Ratio for the 12-month period then
ended (or with respect to the Fiscal Quarters ending before September 30, 2002,
the period commencing on October 1, 2001 and ending on the last day of such
Fiscal Quarter) of not less 3.0:1.0.
(d) Senior Leverage Ratio. Commencing with the Fiscal Quarter
ending December 31, 2001 and continuing thereafter, Borrower and its
Subsidiaries on a consolidated basis shall maintain a ratio of (i) Senior Funded
Debt measured as of the last day of each Fiscal Quarter to (ii) EBITDA minus
Capital Expenditures paid in cash, in each case for the four Fiscal Quarters
then ended, of not more than to 2.0:1.0.
(e) Minimum EBITDA. Borrower and its Subsidiaries on a
consolidated basis shall have EBITDA of not less than $17,000,000 for the three
Fiscal Quarter period ending September 30, 2001.
Unless otherwise specifically provided herein, any accounting
term used in the Agreement shall have the meaning customarily given such term in
accordance with GAAP, and all financial computations hereunder shall be computed
in accordance with GAAP consistently applied. That certain items or computations
are explicitly modified by the phrase "in accordance with GAAP" shall in no way
be construed to limit the foregoing. If any "Accounting Changes" (as defined
below) occur and such changes result in a change in the calculation of the
financial covenants, standards or terms used in the Agreement or any other Loan
Document, then Borrower, Agent and Lenders agree to enter into negotiations in
order to amend such provisions of the Agreement so as to equitably reflect such
Accounting Changes with the desired result that the criteria for evaluating
Borrower's and its Subsidiaries' financial condition shall be the same after
such Accounting Changes as if such Accounting Changes had not been made;
provided, however, that the agreement of Requisite Lenders to any required
amendments of such provisions shall be sufficient to bind all Lenders.
"Accounting Changes" means (i) changes in accounting principles required by the
promulgation of any rule, regulation, pronouncement or opinion by the Financial
Accounting Standards Board of the American Institute of Certified Public
Accountants (or successor thereto or any agency with similar functions), (ii)
changes in accounting principles concurred in by Borrower's certified public
accountants; (iii) purchase accounting adjustments under A.P.B. 16 or 17 and
EITF 88-16, and the application of the accounting principles set forth in FASB
109, including the establishment of reserves pursuant thereto and any subsequent
reversal (in whole or in part) of such reserves; and (iv) the reversal of any
reserves established as a result of purchase accounting adjustments. All such
adjustments resulting from expenditures made subsequent to the Closing Date
(including capitalization of costs and expenses or payment of pre-Closing Date
liabilities) shall be treated as expenses in the period the expenditures are
made and deducted as part of the calculation of EBITDA in such period. If Agent,
Borrower and Requisite Lenders agree upon the required amendments, then after
appropriate amendments have been executed and the underlying Accounting Change
with respect thereto has been implemented, any reference to GAAP contained in
the Agreement or in any other Loan Document shall, only to the extent of such
Accounting Change, refer to GAAP, consistently applied after giving effect to
the implementation of such Accounting Change. If Agent, Borrower and Requisite
Lenders cannot agree upon the required amendments within 30 days following the
date of implementation of any Accounting Change, then all Financial Statements
delivered and all calculations of financial covenants and other standards and
terms in accordance with the Agreement and the other Loan Documents shall be
prepared, delivered and made without regard to the underlying Accounting Change.
For purposes of Section 8.1, a breach of a Financial Covenant contained in this
Annex F shall be deemed to have occurred as of any date of determination by
Agent or as of the last day of any specified measurement period, regardless of
when the Financial Statements reflecting such breach are delivered to Agent.
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