EXECUTION
SECOND AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT
DATED AS OF DECEMBER 1, 2004
AMONG
VICAR OPERATING, INC.,
VCA ANTECH, INC.
(FORMERLY KNOWN AS VETERINARY CENTERS OF AMERICA, INC.),
CERTAIN SUBSIDIARIES OF COMPANY,
AS GUARANTORS,
VARIOUS LENDERS,
GOLDMAN SACHS CREDIT PARTNERS L.P.,
AS JOINT LEAD ARRANGER AND SOLE SYNDICATION AGENT,
AND
WELLS FARGO BANK, N.A.,
AS JOINT LEAD ARRANGER AND ADMINISTRATIVE AGENT
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$275,000,000 SENIOR SECURED CREDIT FACILITIES
--------------------------------------------------------
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS AND INTERPRETATION...............................................7
1.1 Definitions..................................................................7
1.2 Accounting Terms............................................................38
1.3 Interpretation, Etc.........................................................39
SECTION 2. LOANS 39....................................................................39
2.1 Term Loans..................................................................39
2.2 Revolving Loans.............................................................40
2.3 Swing Line Loans............................................................41
2.4 Pro Rata Shares; Availability of Funds......................................43
2.5 Use of Proceeds.............................................................44
2.6 Evidence of Debt; Register; Lenders' Books and Records; Notes...............44
2.7 Interest On Loans...........................................................45
2.8 Conversion/continuation.....................................................47
2.9 Default Interest............................................................47
2.10 Fees........................................................................48
2.11 Scheduled Payments..........................................................48
2.12 Voluntary Prepayments/commitment Reductions.................................49
2.13 Mandatory Prepayments/commitment Reductions.................................50
2.14 Application of Prepayments/reductions.......................................52
2.15 General Provisions Regarding Payments.......................................53
2.16 Ratable Sharing.............................................................54
2.17 Making or Maintaining Eurodollar Rate Loans.................................55
2.18 Increased Costs; Capital Adequacy...........................................57
2.19 Taxes; Withholding, Etc.....................................................58
2.20 Obligation to Mitigate......................................................60
2.21 Defaulting Lenders..........................................................60
2.22 Removal or Replacement of a Lender..........................................61
2.23 Issuance of Letters of Credit and Purchase of Participations Therein........62
SECTION 3. CONDITIONS PRECEDENT........................................................66
3.1 Effective Date..............................................................66
3.2 Conditions to Each Credit Extension.........................................68
SECTION 4. REPRESENTATIONS AND WARRANTIES..............................................69
4.1 Organization; Requisite Power and Authority; Qualification..................69
4.2 Capital Stock and Ownership.................................................69
4.3 Due Authorization...........................................................70
4.4 No Conflict.................................................................70
4.5 Governmental Consents.......................................................70
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4.6 Binding Obligation..........................................................70
4.7 Historical Financial Statements.............................................71
4.8 [Reserved]..................................................................71
4.9 No Material Adverse Change..................................................71
4.10 No Restricted Junior Payments...............................................71
4.11 Adverse Proceedings, Etc....................................................71
4.12 Payment of Taxes............................................................71
4.13 Properties..................................................................72
4.14 Environmental Matters.......................................................72
4.15 No Defaults.................................................................73
4.16 Governmental Regulation.....................................................73
4.17 Margin Stock................................................................73
4.18 Employee Matters............................................................73
4.19 Employee Benefit Plans......................................................73
4.20 Certain Fees................................................................74
4.21 Solvency....................................................................74
4.22 [Reserved]..................................................................74
4.23 Subordination of Permitted Seller Notes and Senior Subordinated Note
Documents...................................................................74
4.24 Compliance With Statutes, Etc...............................................74
4.25 Disclosure..................................................................75
SECTION 5. AFFIRMATIVE COVENANTS.......................................................75
5.1 Financial Statements and Other Reports......................................75
5.2 Existence...................................................................79
5.3 Payment of Taxes and Claims.................................................79
5.4 Maintenance of Properties...................................................79
5.5 Insurance...................................................................80
5.6 Inspections.................................................................80
5.7 Lenders Meetings............................................................80
5.8 Compliance With Laws........................................................80
5.9 Environmental...............................................................80
5.10 Subsidiaries................................................................82
5.11 Additional Material Real Estate Assets......................................82
5.12 [Reserved]..................................................................82
5.13 Further Assurances..........................................................82
SECTION 6. NEGATIVE COVENANTS..........................................................83
6.1 Indebtedness................................................................83
6.2 Liens.......................................................................85
6.3 Equitable Lien..............................................................87
6.4 No Further Negative Pledges.................................................87
6.5 Restricted Junior Payments..................................................87
6.6 Restrictions On Subsidiary Distributions....................................90
6.7 Investments.................................................................90
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6.8 Financial Covenants.........................................................91
6.9 Fundamental Changes; Disposition of Assets; Acquisitions....................94
6.10 Disposal of Subsidiary Interests............................................95
6.11 Sales and Lease-backs.......................................................95
6.12 Transactions With Shareholders and Affiliates...............................95
6.13 Conduct of Business.........................................................96
6.14 Permitted Activities of Holdings............................................96
6.15 Amendments or Waivers of Certain Related Agreements.........................96
6.16 Amendments or Waivers With Respect to Subordinated Indebtedness.............97
6.17 Designation of "Senior Indebtedness"........................................97
6.18 Fiscal Year.................................................................97
SECTION 7. GUARANTY....................................................................97
7.1 Guaranty of the Obligations.................................................97
7.2 Contribution by Guarantors..................................................97
7.3 Payment by Guarantors.......................................................98
7.4 Liability of Guarantors Absolute............................................98
7.5 Waivers by Guarantors......................................................100
7.6 Guarantors' Rights of Subrogation, Contribution, Etc.......................101
7.7 Subordination of Other Obligations.........................................102
7.8 Continuing Guaranty........................................................102
7.9 Authority of Guarantors or Company.........................................102
7.10 Financial Condition of Company.............................................102
7.11 Bankruptcy, Etc............................................................102
7.12 Discharge of Guaranty Upon Sale of Guarantor...............................103
SECTION 8. EVENTS OF DEFAULT..........................................................103
8.1 Events of Default..........................................................103
SECTION 9. AGENTS.....................................................................106
9.1 Appointment of Agents......................................................106
9.2 Powers and Duties..........................................................107
9.3 General Immunity...........................................................107
9.4 Agents Entitled to Act as Lender...........................................108
9.5 Lenders' Representations, Warranties and Acknowledgment....................108
9.6 Right to Indemnity.........................................................108
9.7 Successor Administrative Agent and Swing Line Lender.......................109
9.8 Collateral Documents and Guaranty..........................................109
SECTION 10. MISCELLANEOUS..............................................................110
10.1 Notices....................................................................110
10.2 Expenses...................................................................110
10.3 Indemnity..................................................................111
10.4 Set-off....................................................................111
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10.5 Amendments and Waivers.....................................................112
10.6 Successors and Assigns; Participations.....................................114
10.7 Independence of Covenants..................................................117
10.8 Survival of Representations, Warranties and Agreements.....................117
10.9 No Waiver; Remedies Cumulative.............................................117
10.10 Marshalling; Payments Set Aside............................................118
10.11 Severability...............................................................118
10.12 Obligations Several; Independent Nature of Lenders' Rights.................118
10.13 Entire Agreement...........................................................118
10.14 Headings...................................................................118
10.15 Applicable Law.............................................................118
10.16 Consent to Jurisdiction....................................................119
10.17 Waiver of Jury Trial.......................................................119
10.18 Confidentiality............................................................120
10.19 Usury Savings Clause.......................................................120
10.20 Reaffirmation and Grant of Security Interest...............................121
10.21 Counterparts...............................................................121
10.22 Effectiveness..............................................................121
10.23 Reinstatement..............................................................122
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APPENDICES: A-1 Tranche F Term Loan Commitments
B Notice Addresses
SCHEDULES: 1.2 Existing Permitted Partially-Owned Subsidiaries
2.1A Continuing Lenders
4.1 Jurisdictions of Organization and Qualification
4.2 Capital Stock and Ownership
4.10 Restricted Junior Payments
4.13 Real Estate Assets
6.1 Certain Indebtedness
6.2 Certain Liens
6.7 Certain Investments
EXHIBITS: A-1 Funding Notice
A-2 Conversion/Continuation Notice
A-3 Issuance Notice
B-1 Tranche F Term Loan Note
B-2 [Reserved]
B-3 Revolving Loan Note
B-4 Swing Line Note
C Compliance Certificate
D Opinions of Counsel
E Assignment Agreement
F Certificate Re Non-bank Status
G Effective Date Certificate
H Counterpart Agreement
I Pledge and Security Agreement
J Mortgage
K Form of Permitted Seller Note
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AMENDED AND RESTATED
CREDIT AND GUARANTY AGREEMENT
This SECOND AMENDED AND RESTATED CREDIT AND GUARANTY AGREEMENT, dated as of
December 1, 2004, is entered into by and among VICAR OPERATING, INC., a Delaware
corporation ("Company"), VCA ANTECH, INC. (formerly known as Veterinary Centers
of America, Inc.), a Delaware corporation ("HOLDINGS"), CERTAIN SUBSIDIARIES OF
COMPANY, as Guarantors, the Lenders party hereto from time to time, GOLDMAN
SACHS CREDIT PARTNERS L.P. ("GSCP"), as Joint Lead Arranger, and as Sole
Syndication Agent (in such capacity, "SYNDICATION AGENT"), and WELLS FARGO BANK,
N.A. ("WELLS FARGO"), as Joint Lead Arranger (in such capacity, together with
GSCP, the "LEAD ARRANGERS") and Administrative Agent (together with its
permitted successors in such capacity, "ADMINISTRATIVE AGENT") and as Collateral
Agent (together with its permitted successor in such capacity, "COLLATERAL
AGENT").
RECITALS:
WHEREAS, capitalized terms used in these Recitals shall have the respective
meanings set forth for such terms in Section 1.1 hereof;
WHEREAS, Company, Holdings, the Guarantors, certain financial institutions
and other persons (the "EXISTING LENDERS"), GSCP, as joint lead arranger and
sole syndication agent, and Wells Fargo, as joint lead arranger, administrative
agent and collateral agent, are parties to that certain Amended and Restated
Credit and Guaranty Agreement dated as of June 1, 2004 (as heretofore amended,
supplemented or otherwise modified, the "EXISTING CREDIT AGREEMENT"), pursuant
to which the Existing Lenders have extended certain credit facilities to
Company;
WHEREAS, Company desires that certain Existing Lenders and other Lenders
party hereto agree to amend and restate the Existing Credit Agreement in its
entirety to (i) replace the existing Tranche E Term Loans made under the
Existing Credit Agreement (the "EXISTING TRANCHE E TERM LOANS") with the Tranche
F Term Loans made hereunder; and (ii) make certain other changes as more fully
set forth herein, which amendment and restatement shall become effective upon
satisfaction of the conditions precedent set forth herein;
WHEREAS, Company has agreed to secure all of its Obligations by reaffirming
its grant to Collateral Agent, for the benefit of Secured Parties, a First
Priority Lien on certain of its assets, including a pledge of all of the Capital
Stock of each of its Domestic Subsidiaries and 65% of all the Capital Stock of
each of its Foreign Subsidiaries;
WHEREAS, Guarantors have agreed to guarantee the obligations of Company
hereunder and to secure their respective Obligations by reaffirming their grant
to Collateral Agent, for the benefit of Secured Parties, a First Priority Lien
on certain of their respective assets, including a pledge of all of the Capital
Stock of each of their respective Domestic Subsidiaries (including Company) and
65% of all the Capital Stock of each of their respective Foreign Subsidiaries;
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WHEREAS, it is the intent of the parties hereto that this Agreement not
constitute a novation of the obligations and liabilities of the parties under
the Existing Credit Agreement and that this Agreement amend and restate in its
entirety the Existing Credit Agreement; and
WHEREAS, it is the intent of the Credit Parties to confirm that all
Obligations of the Credit Parties under the other Credit Documents shall
continue in full force and effect and that, from and after the Effective Date,
all references to the "CREDIT AGREEMENT" contained therein shall be deemed to
refer to this Agreement.
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained the parties hereto agree as follows:
SECTION 1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS. The following terms used herein, including in the preamble,
recitals, exhibits and schedules hereto, shall have the following meanings:
"ADJUSTED EURODOLLAR RATE" means, for any Interest Rate Determination Date
with respect to an Interest Period for a Eurodollar Rate Loan, the rate per
annum obtained by dividing (and rounding upward to the next whole multiple of
1/16 of 1%) (i) (a) the rate per annum (rounded to the nearest 1/100 of 1%)
equal to the rate determined by Administrative Agent to be the offered rate
which appears on the page of the Telerate Screen which displays an average
British Bankers Association Interest Settlement Rate (such page currently being
page number 3740 or 3750, as applicable) for deposits (for delivery on the first
day of such period) with a term equivalent to such period in Dollars, determined
as of approximately 11:00 a.m. (London, England time) on such Interest Rate
Determination Date, or (b) in the event the rate referenced in the preceding
clause (a) does not appear on such page or service or if such page or service
shall cease to be available, the rate per annum (rounded to the nearest 1/100 of
1%) equal to the rate determined by Administrative Agent to be the offered rate
on such other page or other service which displays an average British Bankers
Association Interest Settlement Rate for deposits (for delivery on the first day
of such period) with a term equivalent to such period in Dollars, determined as
of approximately 11:00 a.m. (London, England time) on such Interest Rate
Determination Date, or (c) in the event the rates referenced in the preceding
clauses (a) and (b) are not available, the rate per annum (rounded to the
nearest 1/100 of 1%) equal to the offered quotation rate to first class banks in
the London interbank market by Wells Fargo for deposits (for delivery on the
first day of the relevant period) in Dollars of amounts in same day funds
comparable to the principal amount of the applicable Loan of Administrative
Agent, in its capacity as a Lender, for which the Adjusted Eurodollar Rate is
then being determined with maturities comparable to such period as of
approximately 11:00 a.m. (London, England time) on such Interest Rate
Determination Date, by (ii) an amount equal to (a) one MINUS (b) the Applicable
Reserve Requirement.
"ADMINISTRATIVE AGENT" as defined in the preamble hereto.
"ADVERSE PROCEEDING" means any action, suit, proceeding (whether
administrative, judicial or otherwise), governmental investigation or
arbitration (whether or not purportedly on behalf of Holdings or any of its
Subsidiaries) at law or in equity, or before or by any
7
Governmental Authority, domestic or foreign (including any Environmental
Claims), whether pending or, to the knowledge of Holdings or any of its
Subsidiaries, threatened against or affecting Holdings or any of its
Subsidiaries or any property of Holdings or any of its Subsidiaries.
"AFFECTED LENDER" as defined in Section 2.17(b).
"AFFECTED LOANS" as defined in Section 2.17(b).
"AFFILIATE" means, as applied to any Person, any other Person directly or
indirectly controlling, controlled by, or under common control with, that
Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with"), as applied to any Person, means the possession, directly or
indirectly, of the power (i) to vote 10% or more of the Securities having
ordinary voting power for the election of directors of such Person or (ii) to
direct or cause the direction of the management and policies of that Person,
whether through the ownership of voting securities or by contract or otherwise.
"AGENT" means each of Lead Arrangers, Syndication Agent, Administrative
Agent and Collateral Agent.
"AGGREGATE AMOUNTS DUE" as defined in Section 2.16.
"AGGREGATE PAYMENTS" as defined in Section 7.2.
"AGREEMENT" means this Second Amended and Restated Credit and Guaranty
Agreement, dated as of December 1, 2004, as it may be amended, supplemented or
otherwise modified from time to time.
"APPLICABLE MARGIN" means (i) (a) with respect to Tranche F Term Loans that
are Eurodollar Rate Loans, 1.75% per annum and (b) with respect to Revolving
Loans that are Eurodollar Rate Loans, a percentage, per annum, determined by
reference to the Leverage Ratio in effect from time to time as set forth below:
LEVERAGE APPLICABLE MARGIN
RATIO FOR EURODOLLAR LOAN
> 3.75:1.00 3.25%
< 3.75:1.00 3.00%
> 3.25:1.00
< 3.25:1.00
> 2.75:1.00 2.75%
< 2.75:1.00
> 2.25:1.00 2.50%
< 2.25:1.00 2.00%
8
, (ii) with respect to Tranche F Term Loans and Revolving Loans that are Base
Rate Loans, the Applicable Margin for Eurodollar Rate Loans as set forth in
clause (i)(a) or (i)(b) above, as applicable, MINUS (b) 1.00% per annum and
(iii) with respect to Swing Line Loans, (a) the Applicable Margin for Eurodollar
Rate Loans as set forth in clause (i)(b) above, MINUS (b) the sum of 1.00% per
annum PLUS the then Applicable Revolving Commitment Fee Percentage. No change in
the Applicable Margin shall be effective until three Business Days after the
date on which Administrative Agent shall have received the applicable financial
statements and a Compliance Certificate pursuant to Section 5.1(d) calculating
the Leverage Ratio. At any time Company has not submitted to Administrative
Agent the applicable information as and when required under Section 5.1(d), the
Applicable Margin shall be determined as if the Leverage Ratio were in excess of
3.75:1.00. Within one Business Day of receipt of the applicable information as
and when required under Section 5.1(d), Administrative Agent shall give each
Lender telefacsimile or telephonic notice (confirmed in writing) of the
Applicable Margin in effect from such date.
"APPLICABLE RESERVE REQUIREMENT" means, at any time, for any Eurodollar
Rate Loan, the maximum rate, expressed as a decimal, at which reserves
(including, without limitation, any basic marginal, special, supplemental,
emergency or other reserves) are required to be maintained with respect thereto
against "Eurocurrency liabilities" (as such term is defined in Regulation D)
under regulations issued from time to time by the Board of Governors of the
Federal Reserve System or other applicable banking regulator. Without limiting
the effect of the foregoing, the Applicable Reserve Requirement shall reflect
any other reserves required to be maintained by such member banks with respect
to (i) any category of liabilities which includes deposits by reference to which
the applicable Adjusted Eurodollar Rate or any other interest rate of a Loan is
to be determined, or (ii) any category of extensions of credit or other assets
which include Eurodollar Rate Loans. A Eurodollar Rate Loan shall be deemed to
constitute Eurocurrency liabilities and as such shall be deemed subject to
reserve requirements without benefits of credit for proration, exceptions or
offsets that may be available from time to time to the applicable Lender. The
rate of interest on Eurodollar Rate Loans shall be adjusted automatically on and
as of the effective date of any change in the Applicable Reserve Requirement.
"APPLICABLE REVOLVING COMMITMENT FEE PERCENTAGE" means a percentage, per
annum, equal to (i) 0.75% with respect to any period during which the Total
Utilization of Revolving Commitments is less than 50% and (ii) 0.50% at all
other times.
"ASSET SALE" means a sale, lease or sub-lease (as lessor or sublessor),
sale and leaseback, assignment, conveyance, transfer or other disposition to, or
any exchange of property with, any Person (other than Company or a Guarantor
Subsidiary), in one transaction or a series of transactions, of all or any part
of Holdings' or any of its Subsidiaries' businesses, assets or properties of any
kind, whether real, personal, or mixed and whether tangible or intangible,
whether now owned or hereafter acquired, including, without limitation, the
Capital Stock of any of Holdings' Subsidiaries (PROVIDED, HOWEVER, that solely
for purposes of Section 2.13(a), such sale of Capital Stock shall not be
considered an Asset Sale), other than (i) inventory (or other assets) sold or
leased in the ordinary course of business, and (ii) sales of other assets for
aggregate consideration of less than $750,000 with respect to any transaction or
series of related transactions.
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"ASSIGNMENT AGREEMENT" means an Assignment Agreement substantially in the
form of Exhibit E, with such amendments or modifications as may be approved by
Administrative Agent.
"AUTHORIZED OFFICER" means, as applied to any Person, any individual
holding the position of chairman of the board (if an officer), chief executive
officer, president or one of its vice presidents (or the equivalent thereof),
and such Person's chief financial officer or treasurer.
"BANKRUPTCY CODE" means Title 11 of the United States Code entitled
"Bankruptcy," as now and hereafter in effect, or any successor statute.
"BASE RATE" means, for any day, a rate per annum equal to the greater of
(i) the Prime Rate in effect on such day and (ii) the Federal Funds Effective
Rate in effect on such day PLUS 1/2 of 1%. Any change in the Base Rate due to a
change in the Prime Rate or the Federal Funds Effective Rate shall be effective
on the effective day of such change in the Prime Rate or the Federal Funds
Effective Rate, respectively.
"BASE RATE LOAN" means a Loan bearing interest at a rate determined by
reference to the Base Rate.
"BENEFICIARY" means each Agent, Issuing Bank, Lender and Lender
Counterparty.
"BUSINESS DAY" means (i) any day excluding Saturday, Sunday and any day
which is a legal holiday under the laws of the State of New York and/or
California or is a day on which banking institutions located in such state are
authorized or required by law or other governmental action to close and (ii)
with respect to all notices, determinations, fundings and payments in connection
with the Adjusted Eurodollar Rate or any Eurodollar Rate Loans, the term
"BUSINESS DAY" shall mean any day which is a Business Day described in clause
(i) and which is also a day for trading by and between banks in Dollar deposits
in the London interbank market.
"CAPITAL LEASE" means, as applied to any Person, any lease of any property
(whether real, personal or mixed) by that Person as lessee that, in conformity
with GAAP, is or should be accounted for as a capital lease on the balance sheet
of that Person.
"CAPITAL STOCK" means any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a Person (other than a corporation),
including, without limitation, partnership interests and membership interests,
and any and all warrants, rights or options to purchase or other arrangements or
rights to acquire any of the foregoing.
"CASH" means money, currency or a credit balance in any demand or Deposit
Account.
"CASH EQUIVALENTS" means, as at any date of determination, (i) marketable
securities (a) issued or directly and unconditionally guaranteed as to interest
and principal by the United States Government or (b) issued by any agency of the
United States the obligations of which are backed by the full faith and credit
of the United States, in each case maturing within one year after such date;
(ii) marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof, in each case maturing within one year after such date
and having, at the time of the acquisition
10
thereof, a rating of at least A-1 from S&P or at least P-1 from Moody's; (iii)
commercial paper maturing no more than one year from the date of creation
thereof and having, at the time of the acquisition thereof, a rating of at least
A-1 from S&P or at least P-1 from Moody's; (iv) certificates of deposit or
bankers' acceptances maturing within one year after such date and issued or
accepted by any Lender or by any commercial bank organized under the laws of the
United States of America or any state thereof or the District of Columbia that
(a) is at least "adequately capitalized" (as defined in the regulations of its
primary Federal banking regulator) and (b) has Tier 1 capital (as defined in
such regulations) of not less than $100,000,000; and (v) shares of any money
market mutual fund that (a) has substantially all of its assets invested
continuously in the types of investments referred to in clauses (i) through (iv)
above, (b) has net assets of not less than $500,000,000, and (c) has the highest
rating obtainable from either S&P or Moody's.
"CERTIFICATE RE NON-BANK STATUS" means a certificate substantially in the
form of Exhibit F.
"CHANGE OF CONTROL" means the occurrence of any of the following: (i) the
sale, lease, transfer, conveyance or other disposition (other than by way of
merger or consolidation), in one or more related transactions, of all or
substantially all of the properties or assets of Holdings and its Subsidiaries
taken as a whole, or of Company and it Subsidiaries taken as a whole, to any
Person or "person" (as such term is used in Section 13(d)(3) of the Exchange
Act), other than the Sponsor, Co-Investors and Management Investors; (ii) the
adoption of a plan relating to the liquidation or dissolution of Holdings or
Company; or (iii) the consummation of any transaction (including without
limitation, any merger or consolidation), as a result of which (y) Holdings
ceases to own directly 100% of the Capital Stock of Company or (z) any Person or
"group" (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act),
other than the Sponsor, Co-Investor and Management Investors, shall have
acquired, directly or indirectly, beneficial ownership of 35% or more on a fully
diluted basis of the aggregate voting interest attributable to all outstanding
Capital Stock of Holdings.
"CLASS" means (i) with respect to Lenders, each of the following classes of
Lenders: (a) Lenders having Tranche F Term Loan Exposure and (b) Lenders having
Revolving Exposure (including Swing Line Lender), and (ii) with respect to
Loans, each of the following classes of Loans: (a) Tranche F Term Loans and (b)
Revolving Loans (including Swing Line Loans).
"CLOSING DATE" means the date that loans were made under the Original
Credit Agreement, which date was September 20, 2000.
"CO-INVESTORS" means certain entities affiliated with (i) Trust Company of
the West and Hamilton Lane Advisors and (ii) the following limited partners in
Sponsor: (a) CalPERS, (b) Caisse De Depot, (c) Procific and (d) PPM America.
"COLLATERAL" means, collectively, all of the real, personal and mixed
property (including Capital Stock) in which Liens are purported to be granted
pursuant to the Collateral Documents as security for the Obligations.
11
"COLLATERAL AGENT" means the institution serving as such under the
Collateral Documents.
"COLLATERAL DOCUMENTS" means the Pledge and Security Agreement, the
Mortgages and all other instruments, documents and agreements delivered by any
Credit Party pursuant to this Agreement or any of the other Credit Documents in
order to grant to Collateral Agent, for the benefit of Secured Parties, a Lien
on any real, personal or mixed property of that Credit Party as security for the
Obligations.
"COMMITMENT" means any Revolving Commitment or Term Loan Commitment.
"COMPANY" as defined in the preamble hereto.
"COMPLIANCE CERTIFICATE" means a Compliance Certificate substantially in
the form of Exhibit C.
"CONSOLIDATED ADJUSTED EBITDA" means, for any period, an amount determined
for Company and its Subsidiaries on a consolidated basis equal to (i) the sum,
without duplication, of the amounts for such period of (a) Consolidated Net
Income, (b) Consolidated Interest Expense, (c) provisions for taxes based on
income, (d) total depreciation expense, (e) total amortization expense, (f)
other non-Cash items reducing Consolidated Net Income (excluding any such
non-Cash item to the extent that it represents an accrual or reserve for
potential Cash items in any future period or amortization of a prepaid Cash item
that was paid in a prior period but, notwithstanding anything to the contrary
herein, including without limitation, reserves for lease expense and other
charges and expenses related to the closure of hospitals to the extent not paid
in cash), (g) to the extent deducted in calculating Consolidated Net Income,
Transaction Costs, (h) payments made under the Management Services Agreement in
accordance with the provisions of Section 6.5(l) and (i) to the extent deducted
in calculating Consolidated Net Income, other one-time non-recurring charges
incurred by Holdings, Company or any of Company's Subsidiaries associated with
the Holdings IPO and the New Company Subordinated Notes, including, without
limitation (A) any non-cash charges incurred by Holdings and/or Company;
PROVIDED, that such non-cash charges shall not exceed $10,400,000 in the
aggregate; (B) a one-time payment to Sponsor; PROVIDED, that such one-time
payment to Sponsor shall not exceed $8,000,000; and (C) underwriting discounts
and commissions and other reasonable costs and expenses associated therewith,
including reasonable legal fees and expenses, MINUS (ii) non-Cash items
increasing Consolidated Net Income for such period (excluding any such non-Cash
item to the extent it represents the reversal of an accrual or reserve for
potential Cash item in any prior period).
"CONSOLIDATED CAPITAL EXPENDITURES" means, for any period, the aggregate of
the expenditures of Company and its Subsidiaries during such period determined
on a consolidated basis that, in accordance with GAAP, are or should be included
in "purchase of property and equipment" or similar items reflected in the
consolidated statement of cash flows of Company and its Subsidiaries excluding,
(i) any acquisition of assets that constitutes a Permitted Acquisition and (ii)
any expenditures made by Company pursuant to Sections 2.13(a) and 2.13(b)
hereof; PROVIDED, HOWEVER, that notwithstanding any of the foregoing to the
contrary, Consolidated Capital Expenditures shall include expenditures of
Company and its Subsidiaries
12
with respect to assets constituting a fee interest in real property acquired by
Company in connection with a Permitted Acquisition.
"CONSOLIDATED CASH INTEREST EXPENSE" means, for any period, Consolidated
Interest Expense for such period, excluding any amounts not payable in Cash.
"CONSOLIDATED CURRENT ASSETS" means, as at any date of determination, the
total assets of Company and its Subsidiaries on a consolidated basis that may
properly be classified as current assets in conformity with GAAP, excluding Cash
and Cash Equivalents.
"CONSOLIDATED CURRENT LIABILITIES" means, as at any date of determination,
the total liabilities of Company and its Subsidiaries on a consolidated basis
that may properly be classified as current liabilities in conformity with GAAP,
excluding the current portion of long term debt.
"CONSOLIDATED EXCESS CASH FLOW" means, for any period, an amount (if
positive) equal to: (i) the sum, without duplication, of the amounts for such
period of (a) Consolidated Adjusted EBITDA, and (b) the Consolidated Working
Capital Adjustment, MINUS (ii) the sum, without duplication, of the amounts for
such period of (a) voluntary and scheduled repayments of Consolidated Total Debt
(excluding repayments of Revolving Loans or Swing Line Loans except to the
extent the Revolving Commitments are permanently reduced in connection with such
repayments), (b) Consolidated Capital Expenditures (net of any proceeds of any
related financings with respect to such expenditures), (c) Consolidated Cash
Interest Expense, (d) the provision for current taxes based on income of
Holdings and its Subsidiaries and payable in cash with respect to such period,
(e) to the extent not otherwise deducted in determining Consolidated Excess Cash
Flow, cash payments made in connection with Permitted Acquisitions and in
connection with the NPC Acquisition (in each case, net of any proceeds of
related financing), (f) all amounts which were paid in cash (or which would have
been payable but for the existence and continuance of an Event of Default) to
Holdings or Leonard Green & Partners, L.P. in conformity with the provisions of
Section 6.5 and Section 6.7(i) hereof, (g) all amounts that were made as
Investments (or which would have been made as Investments but for the existence
and continuance of an Event of Default) in Persons, other than Holdings, Company
or a Guarantor Subsidiary in conformity with the provisions of Section 6.7
hereof, (h) Transaction Costs to the extent included in determining Consolidated
Adjusted EBITDA and to the extent paid in cash during such period (net of any
proceeds of any related financing with respect thereto) and, without
duplication, whether or not included in determining Consolidated Adjusted EBITDA
Transaction Costs (A) made to purchase the restricted Capital Stock of Holdings
in an amount not to exceed $2,000,000 and (B) made pursuant to certain
noncompetition agreements with members of senior management of Holdings in an
aggregate amount not to exceed $10,000,000 and (i) all amounts that were
distributed pro rata to the holders of Capital Stock of Subsidiaries of Company
(other than Company and Subsidiaries of Company) or that were paid in cash to
repurchase the Capital Stock of any Subsidiary of Company from a Person who is
not an Affiliate of Company in conformity with the provisions of Sections 6.5
and 6.7, and MINUS (or plus) (iii) the amount by which outstanding loans
permitted pursuant to Section 6.7(g) hereof increased or decreased during such
period when compared to the immediately preceding Fiscal Year.
13
"CONSOLIDATED FIXED CHARGES" means, for any period, the sum, without
duplication, of the amounts determined for Company and its Subsidiaries on a
consolidated basis equal to (i) Consolidated Cash Interest Expense, (ii)
scheduled payments of principal on Consolidated Total Debt, (iii) Consolidated
Capital Expenditures, (iv) annual management or similar fees paid to Sponsor or
any of its Affiliates and (v) provisions for current cash taxes based on income
with respect to such period.
"CONSOLIDATED INTEREST EXPENSE" means, for any period, total interest
expense (including that portion attributable to Capital Leases in accordance
with GAAP and capitalized interest) of Company and its Subsidiaries on a
consolidated basis with respect to all outstanding Indebtedness of Company and
its Subsidiaries, including all commissions, discounts and other fees and
charges owed with respect to letters of credit and net costs under Interest Rate
Agreements, but excluding, however, any amounts referred to in Section 2.10(c)
payable on or before the Effective Date and any fees paid under or in connection
with the Senior Subordinated Note Documents.
"CONSOLIDATED NET INCOME" means, for any period, (i) the net income (or
loss) of Company and its Subsidiaries on a consolidated basis for such period
taken as a single accounting period determined in conformity with GAAP, MINUS
(ii) (a) the income of any Person (other than a Subsidiary of Company) in which
any other Person (other than Company or any of its Subsidiaries) has a joint
interest, except to the extent of the amount of dividends or other distributions
actually paid to Company or any of its Subsidiaries by such Person during such
period, (b) the income (or loss) of any Person accrued prior to the date it
becomes a Subsidiary of Company or is merged into or consolidated with Company
or any of its Subsidiaries or that Person's assets are acquired by Company or
any of its Subsidiaries, (c) the income of any Subsidiary of Company to the
extent that the declaration or payment of dividends or similar distributions by
that Subsidiary of that income is not at the time permitted by operation of the
terms of its charter or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to that Subsidiary, (d) any
after-tax gains or losses attributable to Asset Sales or returned surplus assets
of any Pension Plan, and (e) (to the extent not included in clauses (a) through
(d) above) any net extraordinary gains or net extraordinary losses.
"CONSOLIDATED TOTAL DEBT" means, as at any date of determination, the
aggregate stated balance sheet amount of all Indebtedness of Company and its
Subsidiaries determined on a consolidated basis in accordance with GAAP.
"CONSOLIDATED TOTAL SENIOR DEBT" means as of any date of determination, the
total amount of Indebtedness incurred by the Company and its Subsidiaries
pursuant to this Agreement, determined as of the last day of any Fiscal Quarter,
MINUS the outstanding principal amount of New Company Subordinated Notes.
"CONSOLIDATED WORKING CAPITAL" means, as at any date of determination, the
excess of Consolidated Current Assets over Consolidated Current Liabilities.
"CONSOLIDATED WORKING CAPITAL ADJUSTMENT" means, for any period on a
consolidated basis, the amount (which may be a negative number) by which
Consolidated Working Capital as
14
of the beginning of such period exceeds (or is less than) Consolidated Working
Capital as of the end of such period.
"CONTINUING LENDERS" means those lenders under the Existing Credit
Agreement identified as Continuing Lenders in Section 2.1A.
"CONTRACTUAL OBLIGATION" means, as applied to any Person, any provision of
any Security issued by that Person or of any indenture, mortgage, deed of trust,
contract, undertaking, agreement or other instrument to which that Person is a
party or by which it or any of its properties is bound or to which it or any of
its properties is subject.
"CONVERSION/CONTINUATION DATE" means the effective date of a continuation
or conversion, as the case may be, as set forth in the applicable
Conversion/Continuation Notice.
"CONVERSION/CONTINUATION NOTICE" means a Conversion/Continuation Notice
substantially in the form of Exhibit A-2.
"COUNTERPART AGREEMENT" means a Counterpart Agreement substantially in the
form of Exhibit H delivered by a Credit Party pursuant to Section 5.10.
"CONTRIBUTING GUARANTORS" as defined in Section 7.2.
"CREDIT DATE" means the date of a Credit Extension.
"CREDIT DOCUMENT" means any of this Agreement, the Notes, if any, the
Collateral Documents, any documents or certificates executed by Company in favor
of Issuing Bank relating to Letters of Credit, and all other documents,
instruments or agreements executed and delivered by a Credit Party for the
benefit of any Agent, Issuing Bank or any Lender in connection herewith,
including, without limitation, any Hedge Agreement entered into in connection
herewith.
"CREDIT EXTENSION" means the making of a Loan or the issuing of a Letter of
Credit.
"CREDIT PARTY" means each Person (other than any Agent, Issuing Bank or any
Lender or any other representative thereof) from time to time party to a Credit
Document.
"CURRENCY AGREEMENT" means any foreign exchange contract, currency swap
agreement, futures contract, option contract, synthetic cap or other similar
agreement or arrangement, each of which is for the purpose of hedging the
foreign currency risk associated with Holdings' and its Subsidiaries' operations
and not for speculative purposes.
"DEFAULT" means a condition or event that, after notice or lapse of time or
both, would constitute an Event of Default.
"DEFAULT EXCESS" means, with respect to any Defaulting Lender, the excess,
if any, of such Defaulting Lender's Pro Rata Share of the aggregate outstanding
principal amount of Loans of all Lenders (calculated as if all Defaulting
Lenders (other than such Defaulting Lender) had
15
funded all of their respective Defaulted Loans) over the aggregate outstanding
principal amount of all Loans of such Defaulting Lender.
"DEFAULT PERIOD" means, with respect to any Defaulting Lender, the period
commencing on the date of the applicable Funding Default and ending on the
earliest of the following dates: (i) the date on which all Commitments are
cancelled or terminated and/or the Obligations are declared or become
immediately due and payable, (ii) the date on which (a) the Default Excess with
respect to such Defaulting Lender shall have been reduced to zero (whether by
the funding by such Defaulting Lender of any Defaulted Loans of such Defaulting
Lender or by the non-pro rata application of any voluntary or mandatory
prepayments of the Loans in accordance with the terms of Section 2.13 or Section
2.14 or by a combination thereof) and (b) such Defaulting Lender shall have
delivered to Company and Administrative Agent a written reaffirmation of its
intention to honor its obligations hereunder with respect to its Commitments,
and (iii) the date on which Company, Administrative Agent and Requisite Lenders
waive all Funding Defaults of such Defaulting Lender in writing.
"DEFAULTING LENDER" as defined in Section 2.21.
"DEFAULTED LOAN" as defined in Section 2.21.
"DEPOSIT ACCOUNT" means a demand, time, savings, passbook or like account
with a bank, savings and loan association, credit union or like organization,
other than an account evidenced by a negotiable certificate of deposit.
"DOLLARS" and the sign "$" mean the lawful money of the United States of
America.
"DOMESTIC SUBSIDIARY" means any Subsidiary organized under the laws of the
United States of America, any State thereof or the District of Columbia.
"EARN-OUT OBLIGATIONS" means any unsecured contingent liability of Holdings
or any of its Subsidiaries owed to any seller in connection with a Permitted
Acquisition that (a) constitutes a portion of the purchase price for such
Permitted Acquisition but is not an amount certain on the date of incurrence
thereof and is not subject to any right of acceleration by such seller and (b)
is only payable upon the achievement of performance standards by the Person or
other property acquired in such Permitted Acquisition and in an amount based
upon such achievement PROVIDED that the maximum aggregate amount of such
liability shall be fixed at a specified amount on the date of such Permitted
Acquisition.
"EFFECTIVE DATE" means the date upon which the conditions set forth in
Section 3.1 are satisfied.
"EFFECTIVE DATE CERTIFICATE" means the Effective Date Certificate
substantially in the form of Exhibit G.
"ELIGIBLE ASSIGNEE" means (i) any Lender, any Affiliate of any Lender and
any Related Fund (any two or more Related Funds being treated as a single
Eligible Assignee for all purposes hereof), and (ii) any commercial bank,
insurance company, investment or mutual fund or other entity that is an
"accredited investor" (as defined in Regulation D under the Securities Act) and
16
which extends credit or buys loans as one of its businesses; PROVIDED, no
Affiliate of Holdings shall be an Eligible Assignee.
"EMPLOYEE BENEFIT PLAN" means any "employee benefit plan" as defined in
Section 3(3) of ERISA which is or was sponsored, maintained or contributed to
by, or required to be contributed by, Holdings or any of its Subsidiaries or, to
the extent that Holdings or any of its Subsidiaries would be liable under ERISA
in respect thereof, any of their respective ERISA Affiliates.
"EMPLOYMENT AGREEMENT" means any of the following: (i) the Employment
Agreement dated as of the date hereof by and between Holdings and Robert L.
Antin, (ii) the Employment Agreement dated as of the date hereof by and between
Holdings and Arthur Antin, (iii) the Employment Agreement dated as of the date
hereof by and between Holdings and Neal Tauber, and (iv) the Employment
Agreement dated as of the date hereof by and between Holdings and Tomas Fuller,
and as such agreements may be amended, restated or otherwise modified from time
to time in accordance with Section 6.15.
"ENVIRONMENTAL CLAIM" means any investigation, notice, notice of violation,
claim, action, suit, proceeding, demand, abatement order or other order or
directive (conditional or otherwise), by any governmental authority or any other
Person, arising (i) pursuant to or in connection with any actual or alleged
violation of any Environmental Law; (ii) in connection with any Hazardous
Material or any actual or alleged Hazardous Materials Activity; or (iii) in
connection with any actual or alleged damage, injury, threat or harm to health,
safety, natural resources or the environment.
"ENVIRONMENTAL LAWS" means any and all current or future foreign or
domestic, federal or state (or any subdivision of either of them), statutes,
ordinances, orders, rules, regulations, guidance documents, judgments,
Governmental Authorizations, or any other requirements of Governmental
Authorities relating to (i) environmental matters, including those relating to
any Hazardous Materials Activity; (ii) the generation, use, storage,
transportation or disposal of Hazardous Materials; or (iii) occupational safety
and health, industrial hygiene, land use or the protection of human, plant or
animal health or welfare, in any manner applicable to Holdings or any of its
Subsidiaries or any Facility.
"ENVIRONMENTAL REPORTS" means any reports and other information, in form
scope and substance satisfactory to Syndication Agent and Collateral Agent
regarding environmental matters relating to the Facilities.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor thereto.
"ERISA AFFILIATE" means, as applied to any Person, (i) any corporation
which is a member of a controlled group of corporations within the meaning of
Section 414(b) of the Internal Revenue Code of which that Person is a member;
(ii) any trade or business (whether or not incorporated) which is a member of a
group of trades or businesses under common control within the meaning of Section
414(c) of the Internal Revenue Code of which that Person is a member; and (iii)
any member of an affiliated service group within the meaning of Section
17
414(m) or (o) of the Internal Revenue Code of which that Person, any corporation
described in clause (i) above or any trade or business described in clause (ii)
above is a member. Any former ERISA Affiliate of Holdings or any of its
Subsidiaries shall continue to be considered an ERISA Affiliate of Holdings or
any such Subsidiary within the meaning of this definition with respect to the
period such entity was an ERISA Affiliate of Holdings or such Subsidiary and
with respect to liabilities arising after such period for which Holdings or such
Subsidiary could be liable under the Internal Revenue Code or ERISA.
"ERISA EVENT" means (i) a "reportable event" within the meaning of Section
4043 of ERISA and the regulations issued thereunder with respect to any Pension
Plan (excluding those for which the provision for 30-day notice to the PBGC has
been waived by regulation); (ii) the failure to meet the minimum funding
standard of Section 412 of the Internal Revenue Code with respect to any Pension
Plan (whether or not waived in accordance with Section 412(d) of the Internal
Revenue Code) or the failure to make by its due date a required installment
under Section 412(m) of the Internal Revenue Code with respect to any Pension
Plan or the failure to make any required contribution to a Multiemployer Plan;
(iii) the provision by the administrator of any Pension Plan pursuant to Section
4041(a)(2) of ERISA of a notice of intent to terminate such plan in a distress
termination described in Section 4041(c) of ERISA; (iv) the withdrawal by
Holdings, any of its Subsidiaries or any of their respective ERISA Affiliates
from any Pension Plan with two or more contributing sponsors or the termination
of any such Pension Plan resulting in liability pursuant to Section 4063 or 4064
of ERISA; (v) the institution by the PBGC of proceedings to terminate any
Pension Plan, or the occurrence of any event or condition which might constitute
grounds under ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan; (vi) the imposition of liability on Holdings, any
of its Subsidiaries or any of their respective ERISA Affiliates pursuant to
Section 4062(e) or 4069 of ERISA or by reason of the application of Section
4212(c) of ERISA; (vii) the withdrawal of Holdings, any of its Subsidiaries or
any of their respective ERISA Affiliates in a complete or partial withdrawal
(within the meaning of Sections 4203 and 4205 of ERISA) from any Multiemployer
Plan if there is any potential liability ~therefore, or the receipt by Holdings,
any of its Subsidiaries or any of their respective ERISA Affiliates of notice
from any Multiemployer Plan that it is in reorganization or insolvency pursuant
to Section 4241 or 4245 of ERISA, or that it intends to terminate or has
terminated under Section 4041A or 4042 of ERISA; (viii) the occurrence of an act
or omission which could give rise to the imposition on Holdings, any of its
Subsidiaries or any of their respective ERISA Affiliates of fines, penalties,
taxes or related charges under Chapter 43 of the Internal Revenue Code or under
Section 409, Section 502(c), (i) or (l), or Section 4071 of ERISA in respect of
any Employee Benefit Plan; (ix) receipt from the Internal Revenue Service of
notice of the failure of any Pension Plan (or any other Employee Benefit Plan
intended to be qualified under Section 401(a) of the Internal Revenue Code) to
qualify under Section 401(a) of the Internal Revenue Code; or (x) the imposition
of a Lien pursuant to Section 401(a)(29) or 412(n) of the Internal Revenue Code
or pursuant to ERISA with respect to any Pension Plan.
"EURODOLLAR RATE LOAN" means a Loan bearing interest at a rate determined
by reference to the Adjusted Eurodollar Rate.
"EVENT OF DEFAULT" means each of the conditions or events set forth in
Section 8.1.
18
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended from
time to time, and any successor statute.
"EXISTING CREDIT AGREEMENT" as defined in the recitals hereto.
"EXISTING LENDERS" as defined in the recitals hereto.
"EXISTING TRANCHE E TERM LOANS" as defined in the recitals hereto.
"FACILITY" means any real property (including all buildings, fixtures or
other improvements located thereon) now, hereafter or heretofore owned, leased,
operated or used by Holdings or any of its Subsidiaries or any of their
respective predecessors or Affiliates.
"FAIR SHARE CONTRIBUTION AMOUNT" as defined in Section 7.2.
"FAIR SHARE" as defined in Section 7.2.
"FAIR SHARE SHORTFALL" as defined in Section 7.2.
"FEDERAL FUNDS EFFECTIVE RATE" means for any day, the rate per annum
(expressed, as a decimal, rounded upwards, if necessary, to the next higher
1/100 of 1%) equal to the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published by the Federal Reserve Bank of
New York on the Business Day next succeeding such day; PROVIDED, (i) if such day
is not a Business Day, the Federal Funds Effective Rate for such day shall be
such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (ii) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Effective Rate
for such day shall be the average rate charged to Administrative Agent, in its
capacity as a Lender, on such day on such transactions as determined by
Administrative Agent.
"FINANCIAL OFFICER CERTIFICATION" means, with respect to the financial
statements for which such certification is required, the certification of the
chief financial officer of Holdings that such financial statements fairly
present, in all material respects, the financial condition of Holdings and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated, subject to changes resulting from
audit and normal year-end adjustments.
"FINANCIAL PLAN" as defined in Section 5.1(i).
"FIRST PRIORITY" means, with respect to any Lien purported to be created in
any Collateral pursuant to any Collateral Document, that such Lien is the only
Lien to which such Collateral is subject, other than Permitted Liens.
"FISCAL QUARTER" means a fiscal quarter of any Fiscal Year.
"FISCAL YEAR" means the fiscal year of Holdings and its Subsidiaries ending
on December 31 of each calendar year.
19
"FIXED CHARGE COVERAGE RATIO" means the ratio as of the last day of any
Fiscal Quarter of (i) Consolidated Adjusted EBITDA for the four-Fiscal Quarter
period then ending, to (ii) Consolidated Fixed Charges for such four-Fiscal
Quarter period.
"FLOOD HAZARD PROPERTY" means any Real Estate Asset subject to a Mortgage
and located in an area designated by the Federal Emergency Management Agency as
having special flood or mud slide hazards.
"FOREIGN SUBSIDIARY" means any Subsidiary that is not a Domestic
Subsidiary.
"FUNDING DEFAULT" as defined in Section 2.21.
"FUNDING GUARANTORS" as defined in Section 7.2.
"FUNDING NOTICE" means a notice substantially in the form of Exhibit A-1.
"GAAP" means, subject to the limitations on the application thereof set
forth in Section 1.2, United States generally accepted accounting principles in
effect as of the date of determination thereof.
"GOVERNMENTAL ACTS" means any act or omission, whether rightful or
wrongful, of any present or future de jure or de facto government or
Governmental Authority.
"GOVERNMENTAL AUTHORITY" means any federal, state, municipal, national or
other government, governmental department, commission, board, bureau, court,
agency or instrumentality or political subdivision thereof or any entity or
officer exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to any government or any court, in
each case whether associated with a state of the United States, the United
States, or a foreign entity or government.
"GOVERNMENTAL AUTHORIZATION" means any permit, license, authorization,
plan, directive, consent order or consent decree of or from any Governmental
Authority.
"GRANTOR" as defined in the Pledge and Security Agreement.
"GUARANTEED OBLIGATIONS" as defined in Section 7.1.
"GUARANTOR" means each of Holdings and each Domestic Subsidiary of Holdings
(other than Company and certain Permitted Partially-Owned Subsidiaries that do
not provide a Guaranty).
"GUARANTOR SUBSIDIARY" means each Guarantor other than Holdings.
"GUARANTY" means the guaranty of each Guarantor set forth in Section 7.
"HAZARDOUS MATERIALS" means any chemical, material or substance, exposure
to which is prohibited, limited or regulated by any Governmental Authority or
which may or could pose a
20
hazard to the health and safety of the owners, occupants or any Persons in the
vicinity of any Facility or to the indoor or outdoor environment.
"HAZARDOUS MATERIALS ACTIVITY" means any past, current, proposed or
threatened activity, event or occurrence involving any Hazardous Materials,
including the use, manufacture, possession, storage, holding, presence,
existence, location, Release, threatened Release, discharge, placement,
generation, transportation, processing, construction, treatment, abatement,
removal, remediation, disposal, disposition or handling of any Hazardous
Materials, and any corrective action or response action with respect to any of
the foregoing.
"HEDGE AGREEMENT" means an Interest Rate Agreement or a Currency Agreement
entered into with a Lender Counterparty in order to satisfy the requirements of
this Agreement.
"HIGHEST LAWFUL RATE" means the maximum lawful interest rate, if any, that
at any time or from time to time may be contracted for, charged, or received
under the laws applicable to any Lender which are presently in effect or, to the
extent allowed by law, under such applicable laws which may hereafter be in
effect and which allow a higher maximum nonusurious interest rate than
applicable laws now allow.
"HISTORICAL FINANCIAL STATEMENTS" means as of the Closing Date, (i) the
audited financial statements of Holdings and its Subsidiaries, for the
immediately preceding three Fiscal Years, consisting of balance sheets and the
related consolidated statements of income, stockholders' equity and cash flows
for such Fiscal Years, and (ii) the unaudited financial statements of Holdings
and its Subsidiaries as at the most recently ended Fiscal Quarter, consisting of
a balance sheet and the related consolidated statements of income, stockholders'
equity and cash flows for the three-, six- or nine-month period, as applicable,
ending on such date, and, in the case of clauses (i) and (ii), certified by the
chief financial officer of Company that they fairly present, in all material
respects, the financial condition of Holdings and its Subsidiaries as at the
dates indicated and the results of their operations and their cash flows for the
periods indicated, subject to changes resulting from audit and normal year-end
adjustments.
"HOLDINGS" as defined in the preamble hereto.
"HOLDINGS IPO" means an initial public offering of common stock of Holdings
consummated no later than November 30, 2001 and providing gross proceeds to
Holdings of not less than $140,000,000.
"HOLDINGS PURCHASE AGREEMENT" means that certain Purchase Agreement dated
as of September 20, 2000 by and among Holdings, GS Mezzanine Partners II, L.P.
and Permitted Investors, pursuant to which the Preferred Stock, and the Warrants
are sold, as in effect on the Closing Date and as such agreement has and may
thereafter be amended, restated, supplemented or otherwise modified from time to
time to the extent permitted under Section 6.16.
"HOLDINGS REGISTRATION RIGHTS AGREEMENT" means the Exchange and
Registration Rights Agreement dated as of September 20, 2000 among Holdings, GS
Mezzanine Partners II, L.P. and Permitted Investors, as in effect on the Closing
Date and as such agreement may thereafter be amended, restated, supplemented or
otherwise modified from time to time to the extent permitted under Section 6.16.
21
"IMMATERIAL SUBSIDIARY" for purposes of Section 8.1(f) and Section 8.1(g),
shall mean one or more Subsidiaries of Holdings that, on a consolidated basis
did not (i) for the most recently concluded Fiscal Year account for more than
3.0% of consolidated revenues of Holdings and its Subsidiaries and (ii) as of
the last day of such Fiscal Year own more than 3.0% of the consolidated assets
of Holdings and its Subsidiaries.
"INCREASED-COST LENDERS" as defined in Section 2.22.
"INDEBTEDNESS", as applied to any Person, means, without duplication, (i)
all indebtedness for borrowed money; (ii) that portion of obligations with
respect to Capital Leases that is properly classified as a liability on a
balance sheet in conformity with GAAP; (iii) notes payable and drafts accepted
representing extensions of credit whether or not representing obligations for
borrowed money; (iv) any obligation owed for all or any part of the deferred
purchase price of property or services (excluding any such obligations incurred
under ERISA and ordinary course trade payables), which purchase price is (a) due
more than six months from the date of incurrence of the obligation in respect
thereof or (b) evidenced by a note or similar written instrument; (v) all
indebtedness secured by any Lien on any property or asset owned or held by that
Person regardless of whether the indebtedness secured thereby shall have been
assumed by that Person or is nonrecourse to the credit of that Person; (vi) the
face amount of any letter of credit issued for the account of that Person or as
to which that Person is otherwise liable for reimbursement of drawings; (vii)
the direct or indirect guaranty, endorsement (otherwise than for collection or
deposit in the ordinary course of business), co-making, discounting with
recourse or sale with recourse by such Person of the obligation of another;
(viii) any obligation of such Person the primary purpose or intent of which is
to provide assurance to an obligee that the obligation of the obligor thereof
will be paid or discharged, or any agreement relating thereto will be complied
with, or the holders thereof will be protected (in whole or in part) against
loss in respect thereof; and (ix) any liability of such Person for the
obligation of another through any agreement (contingent or otherwise) (a) to
purchase, repurchase or otherwise acquire such obligation or any security
~therefore, or to provide funds for the payment or discharge of such obligation
(whether in the form of loans, advances, stock purchases, capital contributions
or otherwise) or (b) to maintain the solvency or any balance sheet item, level
of income or financial condition of another if, in the case of any agreement
described under subclauses (a) or (b) of this clause (ix), the primary purpose
or intent thereof is as described in clause (viii) above; and (x) obligations of
such Person in respect of any exchange traded or over the counter derivative
transaction, including, without limitation, any Interest Rate Agreement and
Currency Agreement, whether entered into for hedging or speculative purposes;
PROVIDED, in no event shall obligations under any Interest Rate Agreement and
any Currency Agreements be deemed "Indebtedness" for any purpose under Section
6.8.
"INDEMNIFIED LIABILITIES" means, collectively, any and all liabilities,
obligations, losses, damages (including natural resource damages), penalties and
claims (including Environmental Claims), and any and all reasonable and
documented costs (including the costs of any investigation, study, sampling,
testing, abatement, cleanup, removal, remediation or other response action
necessary to remove, remediate, clean up or abate any Hazardous Materials
Activity), expenses and disbursements of any kind or nature whatsoever
(including the reasonable and documented fees and disbursements of counsel for
Indemnitees in connection with any investigative, administrative or judicial
proceeding commenced or threatened by any
22
Person, whether or not any such Indemnitee shall be designated as a party or a
potential party thereto, and any fees or expenses incurred by Indemnitees in
enforcing this indemnity), whether direct, indirect or consequential and whether
based on any federal, state or foreign laws, statutes, rules or regulations
(including securities and commercial laws, statutes, rules or regulations and
Environmental Laws), on common law or equitable cause or on contract or
otherwise, that may be imposed on, incurred by, or asserted against any such
Indemnitee, in any manner relating to or arising out of (i) this Agreement or
the other Credit Documents or the transactions contemplated hereby or thereby
(including Lenders' agreement to make Credit Extensions or the use or intended
use of the proceeds thereof, or any enforcement of any of the Credit Documents
(including any sale of, collection from, or other realization upon any of the
Collateral or the enforcement of the Guaranty)); (ii) the statements contained
in the commitment letter delivered by any Lender to Company or Sponsor with
respect to the transactions contemplated by this Agreement; or (iii) any
Environmental Claim or any Hazardous Materials Activity relating to or arising
from, directly or indirectly, any past or present activity, operation, land
ownership, or practice of Holdings or any of its Subsidiaries.
"INDEMNITEE" as defined in Section 10.3.
"INSTALLMENT" as defined in Section 2.11.
"INSTALLMENT DATE" as defined in Section 2.11.
"INTEREST COVERAGE RATIO" means the ratio as of the last day of any Fiscal
Quarter of (i) Consolidated Adjusted EBITDA for the four-Fiscal Quarter period
then ended, to (ii) Consolidated Cash Interest Expense for such four-Fiscal
Quarter period.
"INTEREST PAYMENT DATE" means with respect to (i) any Base Rate Loan, the
last Business Day of each March, June, September and December of each year,
commencing on the first such date to occur after the Effective Date and the
final maturity date of such Loan; and (ii) any Eurodollar Rate Loan, the last
day of each Interest Period applicable to such Loan; PROVIDED, in the case of
each Interest Period of longer than three months "Interest Payment Date" shall
also include each date that is three months, or an integral multiple thereof,
after the commencement of such Interest Period.
"INTEREST PERIOD" means, in connection with a Eurodollar Rate Loan, an
interest period of one-, two-, three- or six-months, as selected by Company in
the applicable Funding Notice or Conversion/Continuation Notice, (i) initially,
commencing on the Credit Date or Conversion/Continuation Date thereof, as the
case may be; and (ii) thereafter, commencing on the day on which the immediately
preceding Interest Period expires; PROVIDED, (a) if an Interest Period would
otherwise expire on a day that is not a Business Day, such Interest Period shall
expire on the next succeeding Business Day unless no further Business Day occurs
in such month, in which case such Interest Period shall expire on the
immediately preceding Business Day; (b) any Interest Period that begins on the
last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such Interest
Period) shall, subject to clauses (c) through (d), of this definition, end on
the last Business Day of a calendar month; (c) no Interest Period with respect
to any portion of any Class of Term Loans shall extend beyond such Class's Term
Loan Maturity Date; and (d) no Interest
23
Period with respect to any portion of the Revolving Loans shall extend beyond
the Revolving Commitment Termination Date.
"INTEREST RATE AGREEMENT" means any interest rate swap agreement, interest
rate cap agreement, interest rate collar agreement, interest rate hedging
agreement or other similar agreement or arrangement, each of which is for the
purpose of hedging the interest rate exposure associated with Holdings' and its
Subsidiaries' operations and not for speculative purposes.
"INTEREST RATE DETERMINATION DATE" means, with respect to any Interest
Period, the date that is two Business Days prior to the first day of such
Interest Period.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of 1986, as amended
to the date hereof and from time to time hereafter, and any successor statute.
"INVESTMENT" means (i) any direct or indirect purchase or other acquisition
by Holdings or any of its Subsidiaries of, or of a beneficial interest in, any
of the Securities of any other Person (other than Company or a Guarantor
Subsidiary); (ii) any direct or indirect redemption, retirement, purchase or
other acquisition for value, by any Subsidiary of Holdings from any Person
(other than Holdings, Company or any Guarantor Subsidiary), of any Capital Stock
of such Person; and (iii) any direct or indirect loan, advance (other than
advances to employees for moving, entertainment and travel expenses, drawing
accounts and similar expenditures in the ordinary course of business) or capital
contribution by Holdings or any of its Subsidiaries to any other Person (other
than Holdings, Company or any Guarantor Subsidiary), including all indebtedness
and accounts receivable from that other Person that are not current assets or
did not arise from sales to that other Person in the ordinary course of
business. The amount of any Investment shall be the original cost of such
Investment PLUS the cost of all additions thereto, without any adjustments for
increases or decreases in value, or write-ups, write-downs or write-offs with
respect to such Investment.
"INVESTMENT RELATED PROPERTY" as defined in the Pledge and Security
Agreement.
"ISSUANCE NOTICE" means an Issuance Notice substantially in the form of
Exhibit A-3.
"ISSUING BANK" means Wells Fargo as Issuing Bank hereunder, together with
its permitted successors and assigns in such capacity.
"JOINT VENTURE" means a joint venture, partnership or other similar
arrangement, whether in corporate, partnership or other legal form; PROVIDED, in
no event shall any corporate Subsidiary of any Person be considered to be a
Joint Venture to which such Person is a party.
"JUNIOR PREFERRED STOCK" means the shares of junior preferred stock, par
value $.01 per share of Holdings issued to GS Mezzanine Partners II, L.P. and
Permitted Investors pursuant to the terms of the Holdings Purchase Agreement.
"LANDLORD CONSENT AND ESTOPPEL" means, with respect to any Leasehold
Property, a letter, certificate or other instrument in writing from the lessor
under the related lease, pursuant to which, among other things, the landlord
consents to the granting of a Mortgage on such Leasehold Property by the Credit
Party tenant, such Landlord Consent and Estoppel to be in form
24
and substance acceptable to the Collateral Agent in its reasonable discretion,
but in any event sufficient for the Collateral Agent to obtain a Title Policy
with respect to such Mortgage.
"LEAD ARRANGERS" as defined in the preamble hereto.
"LEASEHOLD PROPERTY" means any leasehold interest of any Credit Party as
lessee under any lease of real property, other than any such leasehold interest
designated from time to time by Collateral Agent in its sole discretion as not
being required to be included in the Collateral.
"LENDER" means each financial institution listed on the signature pages
hereto as a Lender and any other Person that becomes a party hereto pursuant to
an Assignment Agreement.
"LENDER COUNTERPARTY" means each Lender or any Affiliate of a Lender
counterparty to a Hedge Agreement, including, without limitation, each such
Affiliate that enters into a joinder agreement with the Collateral Agent.
"LETTER OF CREDIT" means a commercial or standby letter of credit issued or
to be issued by Issuing Bank pursuant to this Agreement.
"LETTER OF CREDIT SUBLIMIT" means the lesser of (i) $10,000,000 and (ii)
the aggregate unused amount of the Revolving Commitments then in effect.
"LETTER OF CREDIT USAGE" means, as at any date of determination, the sum of
(i) the maximum aggregate amount which is, or at any time thereafter may become,
available for drawing under all Letters of Credit then outstanding, and (ii) the
aggregate amount of all drawings under Letters of Credit honored by Issuing Bank
and not theretofore reimbursed by or on behalf of Company.
"LEVERAGE RATIO" means the ratio as of the last day of any Fiscal Quarter
of (i) Consolidated Total Debt as of such day to (ii) Consolidated Adjusted
EBITDA for the four-Fiscal Quarter period ending on such date (as determined in
accordance with Section 6.8(f)).
"LIEN" means (i) any lien, claim, mortgage, pledge, assignment, security
interest, charge or encumbrance of any kind (including any agreement to give any
of the foregoing, any conditional sale or other title retention agreement, and
any lease in the nature thereof) and any option, trust or other preferential
arrangement having the practical effect of any of the foregoing and (ii) in the
case of Securities, any purchase option, call or similar right of a THIRD party
with respect to such Securities.
"LOAN" means a Tranche F Term Loan, a Revolving Loan or a Swing Line Loan.
"MANAGEMENT INVESTORS" means certain management, officers and employees of
Holdings and its Subsidiaries disclosed to Syndication Agent and Administrative
Agent pursuant to the Prior Merger Agreement.
"MANAGEMENT SERVICES AGREEMENT" means that certain Management Services
Agreement, dated as of the Closing Date, by and between Leonard Green &
Partners, L.P., on the one hand and Holdings and Company, on the other.
25
"MARGIN STOCK" as defined in Regulation U of the Board of Governors of the
Federal Reserve System as in effect from time to time.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (i) the
business, operations, properties, assets, condition (financial or otherwise) or
prospects of Holdings and its Subsidiaries, taken as a whole; (ii) the ability
of any Credit Party to fully and timely perform the Obligations; (iii) the
legality, validity, binding effect or enforceability against a Credit Party of a
Credit Document to which it is a party; (iv) the rights, remedies and benefits
available to, or conferred upon, any Agent and any Lender or any Secured Party
under any Credit Document or (v) the Collateral or the Collateral Agent's Liens,
on behalf of Secured Parties on the Collateral or the priority of such Liens.
"MATERIAL CONTRACT" means any contract or other arrangement to which
Holdings or any of its Subsidiaries is a party (other than the Credit Documents)
for which breach, nonperformance, cancellation or failure to renew could
reasonably be expected to have a Material Adverse Effect.
"MATERIAL REAL ESTATE ASSET" means (i) (a) any fee-owned Real Estate Asset
having a fair market value in excess of $1,000,000 as of the date of the
acquisition thereof and (b) all Leasehold Properties other than those with
respect to which the aggregate payments under the term of the lease are less
than $500,000 per annum or (ii) any Real Estate Asset that the Requisite Lenders
have determined is material to the business, operations, properties, assets,
condition (financial or otherwise) or prospects of Holdings or any Subsidiary
thereof, including Company.
"MERGER CORP." means Vicar Recap, Inc., a Delaware corporation formed by
Sponsor, for the purpose of engaging with Holdings and Company the Prior
Acquisition.
"MOODY'S" means Moody's Investor Services, Inc.
"MORTGAGE" means a Mortgage substantially in the form of Exhibit J, as it
may be amended, supplemented or otherwise modified from time to time.
"MORTGAGE DOCUMENTS" means with respect to any Material Real Estate Asset
acquired after the Effective Date (i) fully executed and notarized Mortgages, in
proper form for recording in all appropriate places in all applicable
jurisdictions, encumbering each Material Real Estate Asset; (ii) an opinion of
counsel (which counsel shall be reasonably satisfactory to Collateral Agent and
Syndication Agent) in each state in which such Material Real Estate Asset is
located as such may be reasonably requested by the Collateral Agent with respect
to the enforceability of the form(s) of Mortgages to be recorded in such state
and such other matters as Collateral Agent may reasonably request, in each case
in form and substance reasonably satisfactory to Syndication Agent and
Administrative Agent; (iii) in the case of each Leasehold Property that is a
Material Real Estate Asset, (1) a Landlord Consent and Estoppel Agreement and
(2) evidence that such Leasehold Property is a Recorded Leasehold Interest; (iv)
ALTA mortgagee title insurance policies or unconditional commitments therefore
issued by one or more title companies reasonably satisfactory to Collateral
Agent with respect to each Material Real Estate Asset (each, a "TITLE POLICY"),
in amounts not less than the fair market value of each Material Real Estate
26
Asset, together with a title report issued by a title company with respect
thereto, dated not more than thirty (30) days prior to the date such Material
Real Estate Asset is acquired and copies of all recorded documents listed as
exceptions to title or otherwise referred to therein, each in form and substance
reasonably satisfactory to Collateral Agent; (B) evidence satisfactory to
Collateral Agent that such Credit Party has paid to the title company or the
appropriate governmental authorities all expenses and premiums of the title
company and all other sums required in connection with the issuance of each
Title Policy and all recording and stamp taxes (including mortgage recording and
intangible taxes) payable in connection with recording the Mortgages for each
Material Real Estate Asset in the appropriate real estate records; (v) evidence
of flood insurance with respect to each Flood Hazard Property that is located in
a community that participates in the National Flood Insurance Program, in each
case in compliance with any applicable regulations of the Board of Governors of
the Federal Reserve System, in form and substance reasonably satisfactory to
Collateral Agent; and (vi) ALTA surveys of all such Material Real Estate Assets
which are not Leasehold Properties, to the extent available
"MULTIEMPLOYER PLAN" means any Employee Benefit Plan which is a
"multiemployer plan" as defined in Section 3(37) of ERISA.
"NAIC" means The National Association of Insurance Commissioners, and any
successor thereto.
"NARRATIVE REPORT" means, with respect to the financial statements for
which such narrative report is required, a narrative report describing the
operations of Holdings and its Subsidiaries in the form and to the extent
prepared for presentation to senior management thereof for the applicable month,
Fiscal Quarter or Fiscal Year and for the period from the beginning of the then
current Fiscal Year to the end of such period to which such financial statements
relate.
"NET ASSET SALE PROCEEDS" means, with respect to any Asset Sale, an amount
equal to: (i) Cash payments (including any Cash received by way of deferred
payment pursuant to, or by monetization of, a note receivable or otherwise, but
only as and when so received) received by Holdings or any of its Subsidiaries
from such Asset Sale, MINUS (ii) any bona fide direct costs incurred in
connection with such Asset Sale, including (a) income or gains taxes payable by
the seller as a result of any gain recognized in connection with such Asset
Sale, (b) payment of the outstanding principal amount of, premium or penalty, if
any, and interest on any Indebtedness (other than the Loans) that is secured by
a Lien on the stock or assets in question and that is required to be repaid
under the terms thereof as a result of such Asset Sale and (c) a reasonable
reserve for any indemnification payments (fixed or contingent) attributable to
seller's indemnities and representations and warranties to purchaser in respect
of such Asset Sale undertaken by Holdings or any of its Subsidiaries in
connection with such Asset Sale.
"NET INSURANCE/CONDEMNATION PROCEEDS" means an amount equal to: (i) any
Cash payments or proceeds received by Holdings or any of its Subsidiaries (a)
under any casualty insurance policy in respect of a covered loss thereunder or
(b) as a result of the taking of any assets of Holdings or any of its
Subsidiaries by any Person pursuant to the power of eminent domain, condemnation
or otherwise, or pursuant to a sale of any such assets to a purchaser with such
power under threat of such a taking, MINUS (ii) (a) any actual and reasonable
costs incurred by Holdings or any of its Subsidiaries in connection with the
adjustment or settlement of any
27
claims of Holdings or such Subsidiary in respect thereof, and (b) any bona fide
direct costs incurred in connection with any sale of such assets as referred to
in clause (i)(b) of this definition, including income taxes payable as a result
of any gain recognized in connection therewith.
"NEW COMPANY SUBORDINATED NOTE INDENTURE" means the Indenture entered into
between Company and JP Morgan Chase dated November 27, 2001, pursuant to which
the New Company Subordinated Notes were issued, as such Indenture may hereafter
be amended, restated, supplemented or otherwise modified from time to time to
the extent permitted under Section 6.16.
"NEW COMPANY SUBORDINATED NOTES" means the subordinated notes due December
1, 2009 in an aggregate principal amount of $170,000,000, as such notes may
hereafter be amended, restated, supplemented or otherwise modified from time to
time to the extent permitted under Section 6.16.
"NON-US LENDER" as defined in Section 2.19(c).
"NOTE" means a Tranche F Term Note, a Revolving Note or a Swing Line Note.
"NOTICE" means a Funding Notice or a Conversion/Continuation Notice.
"NPC ACQUISITION" means the merger of Surf, Inc., an indirect wholly owned
Subsidiary of Company with and into National PetCare Centers, Inc., a Delaware
corporation.
"NPC MERGER AGREEMENT" means the Merger Agreement dated as of May 9, 2004
by and among Surf, Inc., a Delaware corporation, Company and NPC.
"OBLIGATIONS" means all obligations of every nature of each Credit Party
from time to time owed to the Agents (including former Agents), the Lenders or
any of them or their respective Affiliates and Lender Counterparties, under any
Credit Document or Hedge Agreement (including, without limitation, with respect
to a Hedge Agreement, obligations owed thereunder to any person who was a Lender
or an Affiliate of a Lender at the time such Hedge Agreement was entered into),
whether for principal, interest (including interest which, but for the filing of
a petition in bankruptcy with respect to such Credit Party, would have accrued
on any Obligation, whether or not a claim is allowed against such Credit Party
for such interest in the related bankruptcy proceeding), reimbursement of
amounts drawn under Letters of Credit, payments for early termination of Hedge
Agreements, fees, expenses, indemnification or otherwise.
"OBLIGEE GUARANTOR" as defined in Section 7.7.
"OPTION EXCHANGE AGREEMENTS" means any of the Option Exchange Agreements,
dated as of or prior to the Closing Date, entered into by and between Holdings
and certain employees of Holdings and its Subsidiaries in connection with the
Prior Acquisition.
"ORGANIZATIONAL DOCUMENTS" means (i) with respect to any corporation, its
certificate or articles of incorporation, as amended, and its by-laws, as
amended, (ii) with respect to any
28
limited partnership, its certificate of limited partnership, as amended, and its
partnership agreement, as amended, (iii) with respect to any general
partnership, its partnership agreement, as amended, and (iv) with respect to any
limited liability company, its articles of organization, as amended, and its
operating agreement, as amended. In the event any term or condition of this
Agreement or any other Credit Document requires any Organizational Document to
be certified by a secretary of state or similar governmental official, the
reference to any such "Organizational Document" shall only be to a document of a
type customarily certified by such governmental official.
"ORIGINAL CREDIT AGREEMENT" means the credit agreement dated September 20,
2000 among Holdings, Company, certain subsidiaries of Company as guarantors, the
lenders party thereto, GSCP, as sole lead arranger and sole syndication agent
and Wells, as administrative agent and collateral agent.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto.
"PENSION PLAN" means any Employee Benefit Plan, other than a Multiemployer
Plan, that is subject to Section 412 of the Internal Revenue Code or Section 302
of ERISA.
"PERMITTED ACQUISITION" means the NPC Acquisition and any other acquisition
by Company or any of its Subsidiaries, whether by purchase, merger or otherwise,
of (y) all or substantially all of the assets of, or 51% or more of the Capital
Stock of, or a business line or unit or a division of, any Person or (z) any
additional portion, or all, of the Capital Stock of any Permitted
Partially-Owned Subsidiary; PROVIDED,
(i) immediately prior to, and after giving effect thereto, no Default
or Event of Default shall have occurred and be continuing or
would result therefrom;
(ii) all transactions in connection therewith shall be consummated, in
all material respects, in accordance with all applicable laws and
in conformity with all applicable Governmental Authorizations;
(iii) in the case of the acquisition of Capital Stock, (i) at least
51% of the Capital Stock (except for any such Securities in the
nature of directors' qualifying shares required pursuant to
applicable law) acquired or otherwise issued by such Person or
any newly formed Subsidiary of Company in connection with such
acquisition shall be owned by Company or a Guarantor Subsidiary
thereof, (ii) in the case of acquisitions where Company owns more
than 51% but less than 100% of such Subsidiary, Company shall
designate such Subsidiary as a Permitted Partially-Owned
Subsidiary, and (iii) except in the case of a Permitted
Partially-Owned Subsidiary, Company shall have taken, or caused
to be taken, as of the date such Person becomes a Subsidiary of
Company, each of the actions set forth in Sections 5.10 and/or
5.11, as applicable;
(iv) Any Person or assets so acquired shall be located exclusively in
the United States or Canada;
(v) Holdings and its Subsidiaries shall be in compliance with the
financial covenants set forth in Section 6.8 on a pro forma basis
after giving effect to such
29
acquisition as of the last day of the Fiscal Quarter most
recently ended (as determined in accordance with Section 6.8(f));
(vi) Company shall have delivered to Administrative Agent (A) at least
five Business Days prior to such proposed acquisition, a
Compliance Certificate evidencing compliance with Section 6.8 as
required under clause (v) above, together with all relevant
financial information with respect to such acquired assets,
including, without limitation, the aggregate consideration for
such acquisition and any other information required to
demonstrate compliance with Section 6.8; PROVIDED, HOWEVER, that
Company shall not be required to comply with the provisions of
this clause (vi) with respect to acquisitions unless the
consideration of such acquisition is greater than $3,000,000;
(vii) any Person or assets or division as acquired in accordance
herewith shall be in a business or lines of business the same as,
related, complementary or ancillary to, the business or lines of
business in which Company and/or its Subsidiaries are engaged as
of the Effective Date; and
(viii) notwithstanding any of the foregoing to the contrary,
"Permitted Acquisition" shall not include any acquisition of any
assets constituting a fee interest in real property to the extent
such acquisition of assets is included in the calculation of
Consolidated Capital Expenditures.
"PERMITTED INVESTORS" means any affiliated investment funds of GS Mezzanine
Partners II, L.P., TCW Leveraged Income Trust, L.P., TCW Leveraged Income Trust
II, L.P., TCW Leveraged Income Trust IV, L.P., TCW/Crescent Mezzanine Partners
II, L.P., TCW/Crescent Mezzanine Trust II and The Northwestern Mutual Life
Insurance Company.
"PERMITTED LIENS" means each of the Liens permitted pursuant to Section
6.2.
"PERMITTED PARTIALLY-OWNED SUBSIDIARY" means (a) those Subsidiaries of
Company listed on Schedule 1.2 existing on the Closing Date, and (b) those
Subsidiaries of Company acquired or created after the Closing Date and
designated by Company as a Permitted Partially-Owned Subsidiary by written
notice to the Administrative Agent, PROVIDED, that, with respect to Permitted
Partially-Owned Subsidiaries acquired or created after the Closing Date, (i)
Company owns at least 51% of the outstanding Capital Stock of such Subsidiary,
(ii) the remaining Capital Stock of such Subsidiary is owned directly or
indirectly, by one or more licensed veterinarians who are actively involved in
the business of such Subsidiary, (iii) Company shall use its commercially
reasonable efforts to cause such Subsidiary to become a Guarantor Subsidiary,
(iv) if Company fails to obtain a Guaranty from such Subsidiary, then such
Subsidiary shall not own and lease any Material Real Estate Assets, and (v)
Company shall use commercially reasonable efforts to cause such veterinarian to
pledge his or her Capital Stock in such Permitted Partially-Owned Subsidiary in
favor of the Collateral Agent for the benefit of the Secured Parties; PROVIDED,
FURTHER, that (i) at no time shall the total portion of Consolidated Adjusted
EBITDA contributed by all Subsidiaries constituting Permitted Partially-Owned
Subsidiaries exceed 15% of Consolidated Adjusted EBITDA and (ii) at no time
shall the portion of Consolidated Adjusted EBITDA contributed by all Permitted
Partially-Owned Subsidiaries
30
acquired or created after the Closing Date which are not Guarantor Subsidiaries
exceed 10% of Consolidated Adjusted EBITDA.
"PERMITTED SELLER NOTES" means promissory notes containing subordination
provisions in substantially the form of, or no less favorable to Lenders (in the
reasonable judgment of Administrative Agent) than the subordination provisions
contained in, Exhibit K annexed hereto, representing any Indebtedness of
Holdings or Company incurred in connection with any Permitted Acquisition
payable to the seller in connection therewith, as such note may be amended,
supplemented or otherwise modified from time to time to the extent permitted
under subsection 6.16; PROVIDED that, no Permitted Seller Note shall (i) be
guarantied by any Subsidiary of Holdings or secured by any property of Holdings,
Company or any of its Subsidiaries, (ii) bear cash interest at a rate greater
than 8.5% per annum; or, (iii) except in accordance with subsection 6.5, provide
for any prepayment or repayment of all or any portion of the principal thereof
prior to the date of the final scheduled installment of principal of the Loans;
PROVIDED, FURTHER, that in no event shall the aggregate scheduled cash payments
of principal and interest on all outstanding Permitted Seller Notes exceed
$4,000,000 in any Fiscal Year.
"PERSON" means and includes natural persons, corporations, limited
partnerships, general partnerships, limited liability companies, limited
liability partnerships, joint stock companies, Joint Ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and Governmental Authorities.
"PLEDGE AND SECURITY AGREEMENT" means the Pledge and Security Agreement to
be executed by Company and each Guarantor, substantially in the form of Exhibit
I, as it may be amended, supplemented or otherwise modified from time to time.
"PREFERRED STOCK" means the Junior Preferred Stock and the Senior Preferred
Stock.
"PRIME RATE" means the rate of interest per annum that Wells Fargo
announces from time to time as its prime lending rate, as in effect from time to
time. The Prime Rate is a reference rate and does not necessarily represent the
lowest or best rate actually charged to any customer. Wells Fargo or any other
Lender may make commercial loans or other loans at rates of interest at, above
or below the Prime Rate.
"PRINCIPAL OFFICE" means, for each of Administrative Agent, Swing Line
Lender and Issuing Bank, such Person's "Principal Office" as set forth on
Appendix B, or such other office as such Person may from time to time designate
in writing to Company, Administrative Agent and each Lender.
"PRIOR ACQUISITION" means the Prior Merger and the other transactions
contemplated by the Prior Merger Agreement.
"PRIOR MERGER AGREEMENT" means that certain Amended and Restated Agreement
and Plan of Merger dated as of August 11, 2000 by and among Holdings, Company
and Merger Corp., and as such agreement may be amended, restated or otherwise
modified from time to time pursuant to Section 6.15.
31
"PRIOR MERGER" means the merger of Merger Corp. with and into Holdings as
contemplated by the Merger Agreement.
"PROJECTIONS" as defined in Section 4.8.
"PRO RATA SHARE" means (i) with respect to all payments, computations and
other matters relating to the Tranche F Term Loan of any Lender, the percentage
obtained by dividing (a) the Tranche F Term Loan Exposure of that Lender by (b)
the aggregate Tranche F Term Loan Exposure of all Lenders and (ii) with respect
to all payments, computations and other matters relating to the Revolving
Commitment or Revolving Loans of any Lender or participations purchased therein
by any Lender or any participations in any Swing Line Loans purchased by any
Lender, the percentage obtained by dividing (a) the Revolving Exposure of that
Lender by (b) the aggregate Revolving Exposure of all Lenders. For all other
purposes with respect to each Lender, "Pro Rata Share" means the percentage
obtained by dividing (A) an amount equal to the sum of the Tranche F Term Loan
Exposure and the Revolving Exposure of that Lender, by (B) an amount equal to
the sum of the aggregate Tranche F Term Loan Exposure and the aggregate
Revolving Exposure of all Lenders.
"REAL ESTATE ASSET" means, at any time of determination, any interest (fee,
leasehold or otherwise) then owned by any Credit Party in any real property.
"RECORD DOCUMENT" means, with respect to any Leasehold Property, (i) the
lease evidencing such Leasehold Property or a memorandum thereof, executed and
acknowledged by the owner of the affected real property, as lessor, or (ii) if
such Leasehold Property was acquired or subleased from the holder of a Recorded
Leasehold Interest, the applicable assignment or sublease document, executed and
acknowledged by such holder, in each case in form sufficient to give such
constructive notice upon recordation and otherwise in form reasonably
satisfactory to Collateral Agent.
"RECORDED LEASEHOLD INTEREST" means a Leasehold Property with respect to
which a Record Document has been recorded in all places necessary or desirable,
in Administrative Agent's reasonable judgment, to give constructive notice of
such Leasehold Property to third-party purchasers and encumbrancers of the
affected real property.
"REFUNDED SWING LINE LOANS" as defined in Section 2.3(b)(iv).
"REGISTER" as defined in Section 2.6(b).
"REGULATION D" means Regulation D of the Board of Governors of the Federal
Reserve System, as in effect from time to time.
"REIMBURSEMENT DATE" as defined in Section 2.23(d).
"RELATED AGREEMENTS" means, collectively, the Prior Merger Agreement, the
NPC Merger Agreement, the Senior Subordinated Note Documents, the Management
Services Agreement, the Stockholders Agreement, the Employment Agreements, the
Stock Purchase Agreement, the Securities Purchase Agreements, the Option
Exchange Agreements, certain noncompetition agreements executed with certain
members of senior management and disclosed
32
to Syndication Agent and Collateral Agent, certain agreements to repurchase
restricted Capital Stock of Holdings held by employees of Holdings and its
Subsidiaries and disclosed to Syndication Agent and Collateral Agent, certain
agreements to provide stay bonuses to certain employees of Holdings and its
Subsidiaries and disclosed to Syndication Agent and Collateral Agent and certain
agreements to make payments in connection with the termination of employment
contracts and disclosed to Syndication Agent and Collateral Agent.
"RELATED FUND" means, with respect to any Lender that is an investment
fund, any other investment fund that invests in commercial loans and that is
managed or advised by the same investment advisor as such Lender or by an
Affiliate of such investment advisor.
"RELEASE" means any release, spill, emission, leaking, pumping, pouring,
injection, escaping, deposit, disposal, discharge, dispersal, dumping, leaching
or migration of any Hazardous Material into the indoor or outdoor environment
(including the abandonment or disposal of any barrels, containers or other
closed receptacles containing any Hazardous Material), including the movement of
any Hazardous Material through the air, soil, surface water or groundwater.
"REPLACEMENT LENDER" as defined in Section 2.22.
"REPLACEMENT TERM LOANS" as defined in Section 10.5(e).
"REQUISITE CLASS LENDERS" means, as at any date of determination, (i) for
the Class of Lenders having Tranche F Term Loan Exposure, Lenders holding more
than 50% of the aggregate Tranche F Term Loan Exposure of all Lenders; and (ii)
for the Class of Lenders having Revolving Exposure, Lenders having or holding
more than 50% of the aggregate Revolving Exposure of all Lenders.
"REQUISITE LENDERS" means three or more Lenders having or holding Tranche F
Term Loan Exposure and/or Revolving Exposure and representing more than 50% of
the sum of (i) the aggregate Tranche F Term Loan Exposure of all Lenders and
(ii) the aggregate Revolving Exposure of all Lenders.
"RESTRICTED JUNIOR PAYMENT" means (i) any dividend or other distribution,
direct or indirect, on account of any shares of any class of stock of Holdings
or Company or any of its Subsidiaries now or hereafter outstanding, except a
dividend payable solely in shares of that class of stock to the holders of that
class; (ii) any redemption, retirement, sinking fund or similar payment,
purchase or other acquisition for value, direct or indirect, of any shares of
any class of stock of Holdings or Company or any of its Subsidiaries now or
hereafter outstanding; (iii) any payment made to retire, or to obtain the
surrender of, any outstanding warrants, options or other rights to acquire
shares of any class of stock of Holdings or Company or any of its Subsidiaries
now or hereafter outstanding; (iv) management or similar fees payable to Sponsor
or any of its Affiliates; and (v) any payment or prepayment of principal of,
premium, if any, or interest on, or redemption, purchase, retirement, defeasance
(including in-substance or legal defeasance), sinking fund or similar payment
with respect to, any Subordinated Indebtedness.
"REVOLVING COMMITMENT" means the commitment of a Lender to make or
otherwise fund any Revolving Loan and to acquire participations in Letters of
Credit and Swing Line
33
Loans hereunder and "REVOLVING COMMITMENTS" means such commitments of all
Lenders in the aggregate. The amount of each Lender's Revolving Commitment, if
any, is set forth in the applicable Assignment Agreement, subject to any
adjustment or reduction pursuant to the terms and conditions hereof. The
aggregate amount of the Revolving Commitments as of the Effective Date is
$50,000,000.
"REVOLVING COMMITMENT PERIOD" means the period from the Effective Date to
but excluding the Revolving Commitment Termination Date.
"REVOLVING COMMITMENT TERMINATION DATE" means the earliest to occur of (i)
September 30, 2006, (ii) the date the Revolving Commitments are permanently
reduced to zero pursuant to Section 2.12(b) or 2.13, and (iii) the date of the
termination of the Revolving Commitments pursuant to Section 8.1.
"REVOLVING EXPOSURE" means, with respect to any Lender as of any date of
determination, (i) prior to the termination of the Revolving Commitments, that
Lender's Revolving Commitment; and (ii) after the termination of the Revolving
Commitments, the sum of (a) the aggregate outstanding principal amount of the
Revolving Loans of that Lender, (b) in the case of Issuing Bank, the aggregate
Letter of Credit Usage in respect of all Letters of Credit issued by that Lender
(net of any participations by Lenders in such Letters of Credit), (c) the
aggregate amount of all participations by that Lender in any outstanding Letters
of Credit or any unreimbursed drawing under any Letter of Credit, (d) in the
case of Swing Line Lender, the aggregate outstanding principal amount of all
Swing Line Loans (net of any participations therein by other Lenders), and (e)
the aggregate amount of all participations therein by that Lender in any
outstanding Swing Line Loans.
"REVOLVING LOAN" means a Loan made by a Lender to Company pursuant to
Section 2.2(a).
"REVOLVING LOAN NOTE" means a promissory note in the form of Exhibit B-3,
as it may be amended, supplemented or otherwise modified from time to time.
"S&P" means Standard & Poor's Ratings Group, a division of The McGraw Hill
Corporation.
"SECURED PARTIES" has the meaning assigned to that term in the Pledge and
Security Agreement.
"SECURITIES" means any stock, shares, partnership interests, voting trust
certificates, certificates of interest or participation in any profit-sharing
agreement or arrangement, options, warrants, bonds, debentures, notes, or other
evidences of indebtedness, secured or unsecured, convertible, subordinated or
otherwise, or in general any instruments commonly known as "securities" or any
certificates of interest, shares or participations in temporary or interim
certificates for the purchase or acquisition of, or any right to subscribe to,
purchase or acquire, any of the foregoing.
"SECURITIES ACT" means the Securities Act of 1933, as amended from time to
time, and any successor statute.
34
"SECURITIES PURCHASE AGREEMENTS" means any of the Securities Purchase
Agreements, dated as of or prior to the Closing Date, entered into by and
between Holdings and its Management Investors.
"SENIOR LEVERAGE RATIO" means the ratio as of the last day of any Fiscal
Quarter of (i) Consolidated Total Senior Debt as of such day to (ii)
Consolidated Adjusted EBITDA for the four-Fiscal Quarter ending on such date (as
determined in accordance with Section 6.8(f)).
"SENIOR PREFERRED STOCK" means the shares of senior preferred stock, par
value $.001 per share of Holdings issued to GS Mezzanine Partners II, L.P. and
Permitted Investors pursuant to the terms of the Holdings Purchase Agreement.
"SENIOR SUBORDINATED NOTE DOCUMENTS" means the New Company Subordinated
Notes and the New Company Subordinated Note Indenture, and each other document
executed in connection with the New Company Subordinated Notes, as such document
may be amended, restated, supplemented or otherwise modified from time to time
to the extent permitted under Section 6.16.
"SOLVENCY CERTIFICATE" means a Solvency Certificate of the chief financial
officer of Holdings substantially in the form of Exhibit G-2.
"SOLVENT" means, with respect to any Person, that as of the date of
determination both (i) (a) the sum of such Person's debt (including contingent
liabilities) does not exceed all of its property, at a fair valuation; (b) the
present fair saleable value of the property of such Person is not less than the
amount that will be required to pay the probable liabilities on such Person's
then existing debts as they become absolute and matured; (c) such Person's
capital is not unreasonably small in relation to its business or any
contemplated or undertaken transaction; and (d) such Person does not intend to
incur, or believe (nor should it reasonably believe) that it will incur, debts
beyond its ability to pay such debts as they become due; and (ii) such Person is
"solvent" within the meaning given that term and similar terms under applicable
laws relating to fraudulent transfers and conveyances. For purposes of this
definition, the amount of any contingent liability at any time shall be computed
as the amount that, in light of all of the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability (irrespective of whether such contingent liabilities
meet the criteria for accrual under Statement of Financial Accounting Standard
No. 5).
"SPONSOR" means Green Equity Investors III, L.P., a Delaware limited
partnership.
"STOCK PURCHASE AGREEMENT" means the Stock Purchase Agreement dated as of
March 30, 2000, by and between Robert L. Antin and Sponsor, and as such
agreement may be amended, restated or otherwise modified from time to time.
"STOCKHOLDERS AGREEMENT" means the Stockholders Agreement dated as of the
date hereof by and among Holdings, Sponsor, Co-Investors, GS Mezzanine Partners
II, L.P., Permitted Investors and Management Investors, and as such agreement
may be amended, restated or otherwise modified from time to time.
"SUBJECT TRANSACTION" as defined in Section 6.8(f).
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"SUBORDINATED INDEBTEDNESS" means (i) Indebtedness of Company and its
Subsidiaries under the Senior Subordinated Note Documents and (ii) Indebtedness
outstanding under Permitted Seller Notes.
"SUBSIDIARY" means, with respect to any Person, any corporation,
partnership, limited liability company, association, joint venture or other
business entity of which more than 50% of the total voting power of shares of
stock or other ownership interests entitled (without regard to the occurrence of
any contingency) to vote in the election of the Person or Persons (whether
directors, managers, trustees or other Persons performing similar functions)
having the power to direct or cause the direction of the management and policies
thereof is at the time owned or controlled, directly or indirectly, by that
Person or one or more of the other Subsidiaries of that Person or a combination
thereof; PROVIDED, in determining the percentage of ownership interests of any
Person controlled by another Person, no ownership interest in the nature of a
"qualifying share" of the former Person shall be deemed to be outstanding.
"SWING LINE LENDER" means Wells Fargo in its capacity as Swing Line Lender
hereunder, together with its permitted successors and assigns in such capacity.
"SWING LINE LOAN" means a Loan made by Swing Line Lender to Company
pursuant to Section 2.3.
"SWING LINE NOTE" means a promissory note in the form of Exhibit B-4, as it
may be amended, supplemented or otherwise modified from time to time.
"SWING LINE SUBLIMIT" means the lesser of (i) $5,000,000, and (ii) the
aggregate unused amount of Revolving Commitments then in effect.
"SYNDICATION AGENT" as defined in the preamble hereto.
"TAKE OUT SECURITIES" means Capital Stock or other securities convertible
into or otherwise linked to Capital Stock, the net proceeds of which are used to
pay the New Company Senior Subordinated Notes either by (a) the consummation of
the Tender Offer or (b) their redemption in accordance with the terms of the New
Company Subordinated Note Indenture; PROVIDED, HOWEVER, that to the extent the
issuance of such Capital Stock or other securities constitute Indebtedness, such
Indebtedness shall be unsecured an subordinated in a manner satisfactory to the
Agents.
"TAX" means any present or future tax, levy, impost, duty, assessment,
charge, fee, deduction or withholding of any nature now or hereafter imposed,
levied, collected, withheld or assessed by any taxing authority; PROVIDED, "Tax
on the overall net income" of a Person shall be construed as a reference to a
tax imposed by the jurisdiction in which that Person is organized or in which
that Person's applicable principal office (and/or, in the case of a Lender, its
lending office) is located or in which that Person (and/or, in the case of a
Lender, its lending office) is deemed to be doing business on or measured by all
or part of the net income, profits or gains (whether worldwide, or only insofar
as such income, profits or gains are considered to arise in or to relate to a
particular jurisdiction, or otherwise) of that Person (and/or, in the case of a
Lender, its applicable lending office).
36
"TENDER OFFER" means a offer made by Company to purchase all or a portion
of the New Company Subordinated Notes ; provided that the Company cannot make
more than one (1) tender offer in any six month period.
"TERM LOAN" means a Tranche F Term Loan.
"TERM LOAN COMMITMENT" means the Tranche F Term Loan Commitment of a
Lender, and "TERM LOAN COMMITMENTS" means such commitments of all Lenders in the
aggregate.
"TERM LOAN MATURITY DATE" means the Tranche F Term Loan Maturity Date.
"TERMINATED LENDER" as defined in Section 2.22.
"TOTAL UTILIZATION OF REVOLVING COMMITMENTS" means, as at any date of
determination, the sum of (i) the aggregate principal amount of all outstanding
Revolving Loans (other than Revolving Loans made for the purpose of repaying any
Refunded Swing Line Loans or reimbursing Issuing Bank for any amount drawn under
any Letter of Credit, but not yet so applied), (ii) the aggregate principal
amount of all outstanding Swing Line Loans, and (iii) the Letter of Credit
Usage.
"TRANCHE F TERM LOAN" means a Tranche F Term Loan made by a Lender to
Company pursuant to Section 2.1(a).
"TRANCHE F TERM LOAN COMMITMENT" means the commitment of a Lender to make
or otherwise fund a Tranche F Term Loan and "TRANCHE F TERM LOAN COMMITMENTS"
means such commitments of all Lenders in the aggregate. The amount of each
Lender's Tranche F Term Loan Commitment, if any, is set forth on Appendix A-1 or
in the applicable Assignment Agreement, subject to any adjustment or reduction
pursuant to the terms and conditions hereof. The aggregate amount of the Tranche
F Term Loan Commitments as of the Effective Date is $[223,875,000].
"TRANCHE F TERM LOAN EXPOSURE" means, with respect to any Lender, as of any
date of determination, the outstanding principal amount of the Tranche F Term
Loans of such Lender; PROVIDED, at any time prior to the making of the Tranche F
Term Loans, the Tranche F Term Loan Exposure of any Lender shall be equal to
such Lender's Tranche F Term Loan Commitment.
"TRANCHE F TERM LOAN MATURITY DATE" means the earlier of (i) September 30,
2008, and (ii) the date that all Tranche F Term Loans shall become due and
payable in full hereunder, whether by acceleration or otherwise.
"TRANCHE F TERM LOAN NOTE" means a promissory note in the form of Exhibit
B-1, as it may be amended, supplemented or otherwise modified from time to time.
"TRANSACTION COSTS" means the fees, costs and expenses payable by Holdings,
Company or any of Company's Subsidiaries in connection with the closing of the
transactions contemplated by the Credit Documents and the Related Agreements,
including, without limitation, (i) any charge incurred by Holdings and/or
Company arising out of the repurchase at
37
$15 per share on the Closing Date of restricted Capital Stock of Holdings held
by certain employees of Holdings and its Subsidiaries; PROVIDED, that payment of
an amount not to exceed $2,000,000 of the aggregate purchase price for such
restricted Capital Stock may be deferred for not more than sixteen (16) months
after the Closing Date, (ii) any financing, legal, accounting, investment
banking or other professional fees and expenses incurred in connection with the
Prior Acquisition; PROVIDED, that such fees in the aggregate do not exceed an
amount disclosed to and reasonably acceptable to Syndication Agent on or before
the Closing Date, (iii) any financing, legal, accounting, investment banking or
other professional fees and expenses incurred in connection with the NPC
Acquisition; PROVIDED, that such fees in the aggregate do not exceed $7,500,000,
(iv) any other costs and expenses incurred by Holdings and/or Company and its
Subsidiaries in connection with the Acquisition arising pursuant to certain
noncompetition agreements executed with members of senior management of
Holdings, in connection with the termination of certain employment contracts of
Holdings and its Subsidiaries and in connection with stay bonuses provided to
certain employees of Holdings and its Subsidiaries in an aggregate amount not to
exceed $19,300,000, PROVIDED, that payment of an amount not to exceed $5,000,000
of such costs and expenses may be deferred for not more than sixteen (16) months
after the Closing Date and (v) premium payments payable to certain note holders
of Holdings in an aggregate amount not to exceed $1,700,000.
"TYPE OF LOAN" means (i) with respect to either Term Loans or Revolving
Loans, a Base Rate Loan or a Eurodollar Rate Loan, and (ii) with respect to
Swing Line Loans, a Base Rate Loan.
"UCC" means the Uniform Commercial Code (or any similar or equivalent
legislation) as in effect in any applicable jurisdiction.
"UCC QUESTIONNAIRE" means a certificate in form satisfactory to the
Collateral Agent that provides information with respect to the personal or mixed
property of each Credit Party.
"UNADJUSTED EURODOLLAR RATE COMPONENT" means that component of the interest
costs to Company in respect of a Eurodollar Rate Loan that is based upon the
rate obtained pursuant to clause (i) of the definition of Adjusted Eurodollar
Rate.
"WARRANT AGREEMENT" means the Warrant Agreement dated as of September 20,
2000 among Holdings, GS Mezzanine Partners II, L.P. and Permitted Investors, as
in effect on the Closing Date and as such agreement may thereafter be amended,
restated, supplemented or otherwise modified from time to time to the extent
permitted under Section 6.15.
"WARRANTS" means the warrants to acquire 5.75% of the common equity of
Holdings issued by Holdings to GS Mezzanine Partners II, L.P. and Permitted
Investors on the Closing Date and pursuant to the Warrant Agreement and the
Holdings Purchase Agreement, as such warrants are in effect on the dates of
their respective issuances and as such warrants may thereafter be amended,
restated, supplemented or otherwise modified from time to time to the extent
permitted under Section 6.15.
1.2 ACCOUNTING TERMS. Except as otherwise expressly provided herein, all
accounting terms not otherwise defined herein shall have the meanings
assigned to them in
38
conformity with GAAP. Financial statements and other information
required to be delivered by Holdings to Lenders pursuant to Section
5.1(a), 5.1(b) and 5.1(c) shall be prepared in accordance with GAAP as
in effect at the time of such preparation (and delivered together with
the reconciliation statements provided for in Section 5.1(e), if
applicable). Subject to the foregoing, calculations in connection with
the definitions, covenants and other provisions hereof shall utilize
accounting principles and policies in conformity with those used to
prepare the Historical Financial statements.
1.3 INTERPRETATION, ETC. Any of the terms defined herein may, unless the
context otherwise requires, be used in the singular or the plural,
depending on the reference. References herein to any Section,
Appendix, Schedule or Exhibit shall be to a Section, an Appendix, a
Schedule or an Exhibit, as the case may be, hereof unless otherwise
specifically provided. The use herein of the word "include" or
"including", when following any general statement, term or matter,
shall not be construed to limit such statement, term or matter to the
specific items or matters set forth immediately following such word or
to similar items or matters, whether or not nonlimiting language (such
as "without limitation" or "but not limited to" or words of similar
import) is used with reference thereto, but rather shall be deemed to
refer to all other items or matters that fall within the broadest
possible scope of such general statement, term or matter.
SECTION 2. LOANS
2.1 TERM LOANS.
(a) LOAN COMMITMENTS.
(i) Subject to the terms and conditions of this Agreement, each
of the Continuing Lenders agrees that the Existing Tranche E
Term Loans made by such Lender under the Existing Credit
Agreement in the amounts set forth in Schedule 2.1A shall
remain outstanding on and after the Effective Date as
Tranche F Term Loans made pursuant to this Agreement and
such Term Loans shall on and after the Effective Date have
all of the rights and benefits of Tranche F Term Loans as
set forth in this Agreement and the other Loan Documents.
(ii) Subject to the terms and conditions hereof, each Lender
severally agrees to make, on the Effective Date, a Tranche F
Term Loan to Company in an amount equal to such Lender's
Tranche F Term Loan Commitment. Company may make only one
borrowing under the Tranche F Term Loan Commitment which
shall be on the Effective Date. Any amount borrowed under
this Section 2.1(a) and subsequently repaid or prepaid may
not be reborrowed. Subject to Sections 2.12(a) and 2.13, all
amounts owed hereunder with respect to the Tranche F Term
Loans shall be paid in full no later than the Tranche F Term
Loan Maturity Date. Each Lender's Tranche F Term Loan
Commitment shall terminate immediately and without further
action on the Effective Date after giving effect to the
funding of such Lender's Tranche F Term Loan Commitment on
such date.
(b) BORROWING MECHANICS FOR TRANCHE F TERM LOANS.
(i) Company shall deliver to Administrative Agent a fully
executed and delivered Effective Date Certificate (which
shall be deemed to be a Funding Notice with respect to the
Tranche F Term Loans for all purposes hereof) no later than
three Business Days
39
prior to the Effective Date. Promptly upon receipt by
Administrative Agent of such certificate, Administrative
Agent shall notify each Lender of the proposed borrowing.
(ii) Each Lender shall make its Tranche F Term Loan available to
Administrative Agent not later than 12:00 p.m. (New York
City time) on the Effective Date, by wire transfer of same
day funds in Dollars, at Administrative Agent's Principal
Office. Upon satisfaction or waiver of the conditions
precedent specified herein, Administrative Agent shall make
the proceeds of the Tranche F Term Loans available to
Company on the Effective Date by causing an amount of same
day funds in Dollars equal to the proceeds of all such Loans
received by Administrative Agent from Lenders to be credited
to the account of Company at Administrative Agent's
Principal Office or to such other account as may be
designated in writing to Administrative Agent by Company.
2.2 REVOLVING LOANS.
(a) REVOLVING COMMITMENTS. During the Revolving Commitment Period,
subject to the terms and conditions hereof, each Lender severally
agrees to make Revolving Loans to Company in the aggregate amount
up to but not exceeding such Lender's Revolving Commitment;
PROVIDED, after giving effect to the making of any Revolving
Loans in no event shall the Total Utilization of Revolving
Commitments exceed the Revolving Commitments then in effect.
Amounts borrowed pursuant to this Section 2.2(a) may be repaid
and reborrowed during the Revolving Commitment Period. Each
Lender's Revolving Commitment shall expire on the Revolving
Commitment Termination Date and all Revolving Loans and all other
amounts owed hereunder with respect to the Revolving Loans and
the Revolving Commitments shall be paid in full no later than
such date.
(b) BORROWING MECHANICS FOR REVOLVING LOANS.
(i) Revolving Loans that are Base Rate Loans shall be made in an
aggregate minimum amount of $1,000,000 and integral
multiples of $500,000 in excess of that amount, and
Revolving Loans that are Eurodollar Rate Loans shall be in
an aggregate minimum amount of $2,000,000 and integral
multiples of $1,000,000 in excess of that amount.
(ii) Whenever Company desires that Lenders make Revolving Loans,
Company shall deliver to Administrative Agent a fully
executed and delivered Funding Notice no later than 1:00
p.m. (New York City time) at least three Business Days in
advance of the proposed Credit Date in the case of a
Eurodollar Rate Loan, and at least one Business Day in
advance of the proposed Credit Date in the case of a
Revolving Loan that is a Base Rate Loan. Except as otherwise
provided herein, a Funding Notice for a Revolving Loan that
is a Eurodollar Rate Loan shall be irrevocable on and after
the related Interest Rate Determination Date, and Company
shall be bound to make a borrowing in accordance therewith.
(iii) Notice of receipt of each Funding Notice in respect of
Revolving Loans, together with the amount of each Lender's
Pro Rata Share thereof, if any, together with the applicable
interest rate, shall be provided by Administrative Agent to
each applicable Lender by telefacsimile with reasonable
promptness, but (provided Administrative Agent shall have
40
received such notice by 1:00 p.m. (New York City time)) not
later than 3:00 p.m. (New York City time) on the same day as
Administrative Agent's receipt of such Notice from Company.
(iv) Each Lender shall make the amount of its Revolving Loan
available to Administrative Agent not later than 12:00 p.m.
(New York City time) on the applicable Credit Date by wire
transfer of same day funds in Dollars, at the Administrative
Agent's Principal Office. Except as provided herein, upon
satisfaction or waiver of the conditions precedent specified
herein, Administrative Agent shall make the proceeds of such
Revolving Loans available to Company on the applicable
Credit Date by causing an amount of same day funds in
Dollars equal to the proceeds of all such Revolving Loans
received by Administrative Agent from Lenders to be credited
to the account of Company at the Administrative Agent's
Principal Office or such other account as may be designated
in writing to Administrative Agent by Company.
2.3 SWING LINE LOANS.
(a) SWING LINE LOANS COMMITMENTS. During the Revolving Commitment
Period, subject to the terms and conditions hereof, Swing Line
Lender hereby agrees to make Swing Line Loans to Company in the
aggregate amount up to but not exceeding the Swing Line Sublimit;
PROVIDED, after giving effect to the making of any Swing Line
Loan, in no event shall the Total Utilization of Revolving
Commitments exceed the Revolving Commitments then in effect.
Amounts borrowed pursuant to this Section 2.3 may be repaid and
reborrowed during the Revolving Commitment Period. Swing Line
Lender's Revolving Commitment shall expire on the Revolving
Commitment Termination Date and all Swing Line Loans and all
other amounts owed hereunder with respect to the Swing Line Loans
and the Revolving Commitments shall be paid in full no later than
such date.
(b) BORROWING MECHANICS FOR SWING LINE LOANS.
(i) Swing Line Loans shall be made in an aggregate minimum
amount of $100,000 and integral multiples of $100,000 in
excess of that amount.
(ii) Whenever Company desires that Swing Line Lender make a Swing
Line Loan, Company shall deliver to Administrative Agent a
Funding Notice no later than 1:00 p.m. (New York City time)
on the proposed Credit Date.
(iii) Swing Line Lender shall make the amount of its Swing Line
Loan available to Administrative Agent not later than 3:00
p.m. (New York City time) on the applicable Credit Date by
wire transfer of same day funds in Dollars, at the
Administrative Agent's Principal Office. Except as provided
herein, upon satisfaction or waiver of the conditions
precedent specified herein, Administrative Agent shall make
the proceeds of such Swing Line Loans available to Company
on the applicable Credit Date by causing an amount of same
day funds in Dollars equal to the proceeds of all such Swing
Line Loans received by Administrative Agent from Swing Line
Lender to be credited to the account of Company at the
Administrative Agent's Principal Office, or to such other
account as may be designated in writing to Administrative
Agent by Company.
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(iv) With respect to any Swing Line Loans which have not been
voluntarily prepaid by Company pursuant to Section 2.12,
Swing Line Lender may at any time in its sole and absolute
discretion, deliver to Administrative Agent (with a copy to
Company), no later than 11:00 a.m. (New York City time) at
least one (1) Business Day in advance of the proposed Credit
Date, a notice (which shall be deemed to be a Funding Notice
given by Company) requesting that each Lender holding a
Revolving Commitment make Revolving Loans that are Base Rate
Loans to Company on such Credit Date in an amount equal to
the amount of such Swing Line Loans (the "REFUNDED SWING
LINE LOANS") outstanding on the date such notice is given
which the Swing Line Lender requests Lenders to prepay.
Notwithstanding anything contained in this Agreement to the
contrary, (1) the proceeds of such Revolving Loans made by
the Lenders other than Swing Line Lender shall be
immediately delivered by the Administrative Agent to Swing
Line Lender (and not to Company) and applied to repay a
corresponding portion of the Refunded Swing Line Loans and
(2) on the day such Revolving Loans are made, Swing Line
Lender's Pro Rata Share of the Refunded Swing Line Loans
shall be deemed to be paid with the proceeds of a Revolving
Loan made by Swing Line Lender to Company, and such portion
of the Swing Line Loans deemed to be so paid shall no longer
be outstanding as Swing Line Loans and shall no longer be
due under the Swing Line Note of Swing Line Lender but shall
instead constitute part of Swing Line Lender's outstanding
Revolving Loans to Company and shall be due under the
Revolving Loan Note issued by Company to Swing Line Lender.
Company hereby authorizes Administrative Agent and Swing
Line Lender to charge Company's accounts with Administrative
Agent and Swing Line Lender (up to the amount available in
each such account) in order to immediately pay Swing Line
Lender the amount of the Refunded Swing Line Loans to the
extent the proceeds of such Revolving Loans made by Lenders,
including the Revolving Loan deemed to be made by the Swing
Line Lender, are not sufficient to repay in full the
Refunded Swing Line Loans. If any portion of any such amount
paid (or deemed to be paid) to Swing Line Lender should be
recovered by or on behalf of Company from Swing Line Lender
in bankruptcy, by assignment for the benefit of creditors or
otherwise, the loss of the amount so recovered shall be
ratably shared among all Lenders in the manner contemplated
by Section 2.16.
(v) If for any reason Revolving Loans are not made pursuant to
Section 2.3(b)(iv) in an amount sufficient to repay any
amounts owed to Swing Line Lender in respect of any
outstanding Swing Line Loans on or before the third Business
Day after demand for payment thereof by Swing Line Lender,
each Lender holding a Revolving Commitment shall be deemed
to, and hereby agrees to, have purchased a participation in
such outstanding Swing Line Loans, and in an amount equal to
its Pro Rata Share of the applicable unpaid amount together
with accrued interest thereon. Upon one (1) Business Day's
notice from Swing Line Lender, each Lender holding a
Revolving Commitment shall deliver to Swing Line Lender an
amount equal to its respective participation in the
applicable unpaid amount in same day funds at the Principal
Office of Swing Line Lender. In order to evidence such
participation each Lender holding a Revolving Commitment
agrees to enter into a participation agreement at the
request of Swing Line Lender in form and substance
reasonably satisfactory to Swing Line Lender. In the event
any Lender holding a Revolving Commitment fails to make
available to Swing Line Lender the amount of such Lender's
participation as provided in this paragraph, Swing Line
Lender shall be entitled to recover such amount on demand
from such Lender together with interest thereon for three
Business Days at the rate customarily used by Swing Line
Lender for the correction of errors among banks and
thereafter at the Base Rate, as applicable.
42
(vi) Notwithstanding anything contained herein to the contrary,
(1) each Lender's obligation to make Revolving Loans for the
purpose of repaying any Refunded Swing Line Loans pursuant
to the second preceding paragraph and each Lender's
obligation to purchase a participation in any unpaid Swing
Line Loans pursuant to the immediately preceding paragraph
shall be absolute and unconditional and shall not be
affected by any circumstance, including without limitation
(A) any set-off, counterclaim, recoupment, defense or other
right which such Lender may have against Swing Line Lender,
any Credit Party or any other Person for any reason
whatsoever; (B) the occurrence or continuation of a Default
or Event of Default; (C) any adverse change in the business,
operations, properties, assets, condition (financial or
otherwise) or prospects of any Credit Party; (D) any breach
of this Agreement or any other Credit Document by any party
thereto; or (E) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing;
PROVIDED that such obligations of each Lender are subject to
the condition that Swing Line Lender believed in good faith
that all conditions under Section 3.2 to the making of the
applicable Refunded Swing Line Loans or other unpaid Swing
Line Loans, were satisfied at the time such Refunded Swing
Line Loans or unpaid Swing Line Loans were made, or the
satisfaction of any such condition not satisfied had been
waived by Requisite Lenders prior to or at the time such
Refunded Swing Line Loans or other unpaid Swing Line Loans
were made; and (2) Swing Line Lender shall not be obligated
to make any Swing Line Loans (A) if it has elected not to do
so after the occurrence and during the continuation of a
Default or Event of Default or (B) at a time when a Funding
Default exists unless Swing Line Lender has entered into
arrangements satisfactory to it and Company to eliminate
Swing Line Lender's risk with respect to the Defaulting
Lender's participation in such Swing Line Loan, including by
cash collateralizing such Defaulting Lender's Pro Rata Share
of the outstanding Swing Line Loans.
2.4 PRO RATA SHARES; AVAILABILITY OF FUNDS.
(a) PRO RATA SHARES. All Loans shall be made, and all participations
purchased, by Lenders simultaneously and proportionately to their
respective Pro Rata Shares, it being understood that no Lender
shall be responsible for any default by any other Lender in such
other Lender's obligation to make a Loan requested hereunder or
purchase a participation required hereby nor shall any Term Loan
Commitment or any Revolving Commitment of any Lender be increased
or decreased as a result of a default by any other Lender in such
other Lender's obligation to make a Loan requested hereunder or
purchase a participation required hereby.
(b) AVAILABILITY OF FUNDS. Unless Administrative Agent shall have
been notified by any Lender prior to the applicable Credit Date
that such Lender does not intend to make available to
Administrative Agent the amount of such Lender's Loan requested
on such Credit Date, Administrative Agent may assume that such
Lender has made such amount available to Administrative Agent on
such Credit Date and Administrative Agent may, in its sole
discretion, but shall not be obligated to, make available to
Company a corresponding amount on such Credit Date. If such
corresponding amount is not in fact made available to
Administrative Agent by such Lender, Administrative Agent shall
be entitled to recover such corresponding amount on demand from
such Lender together with interest thereon, for each day from
such Credit Date until the date such amount is paid to
Administrative Agent, at the customary rate set by Administrative
Agent for the correction of errors among banks for three Business
Days and
43
thereafter at the Base Rate. If such Lender does not pay such
corresponding amount forthwith upon Administrative Agent's demand
~therefore, Administrative Agent shall promptly notify Company
and Company shall immediately pay such corresponding amount to
Administrative Agent together with interest thereon, for each day
from such Credit Date until the date such amount is paid to
Administrative Agent, at the rate payable hereunder for Base Rate
Loans for such Class of Loans. Nothing in this Section 2.4(b)
shall be deemed to relieve any Lender from its obligation to
fulfill its Term Loan Commitments and Revolving Commitments
hereunder or to prejudice any rights that Company may have
against any Lender as a result of any default by such Lender
hereunder.
2.5 USE OF PROCEEDS. All proceeds of the Tranche F Term Loans shall be
applied by Company to replace Existing Tranche E Term Loans
outstanding pursuant to the Existing Credit Agreement. The proceeds of
the Revolving Loans, Letters of Credit and Swing Line Loans shall be
applied by Company for working capital and general corporate purposes
of Company and its Subsidiaries, including Permitted Acquisitions and
the Tender Offer. No portion of the proceeds of any Credit Extension
shall be used in any manner that causes or might cause such Credit
Extension or the application of such proceeds to violate Regulation T,
Regulation U or Regulation X of the Board of Governors of the Federal
Reserve System or any other regulation thereof or to violate the
Exchange Act.
2.6 EVIDENCE OF DEBT; REGISTER; LENDERS' BOOKS AND RECORDS; NOTES.
(a) LENDERS' EVIDENCE OF DEBT. Each Lender shall maintain on its
internal records an account or accounts evidencing the
Indebtedness of Company to such Lender, including the amounts of
the Loans made by it and each repayment and prepayment in respect
thereof. Any such recordation shall be prima facie evidence
thereof; PROVIDED, failure to make any such recordation, or any
error in such recordation, shall not affect any Lender's
Revolving Commitments or Company's Obligations in respect of any
applicable Loans; and PROVIDED further, in the event of any
inconsistency between the Register and any Lender's records, the
reconditions in the Register shall govern.
(b) REGISTER. Administrative Agent shall maintain at its Principal
Office a register for the recordation of the names and addresses
of Lenders and the Revolving Commitments and Loans of each Lender
from time to time (the "REGISTER"). The Register shall be
available for inspection by Company or any Lender at any
reasonable time and from time to time upon reasonable prior
notice. Administrative Agent shall record in the Register the
Revolving Commitments and the Loans, and each repayment or
prepayment in respect of the principal amount of the Loans, and
any such recordation shall be prima facie evidence thereof;
provided, failure to make any such recordation, or any error in
such recordation, shall not affect any Lender's Revolving
Commitments or Company's Obligations in respect of any Loan.
Company hereby designates Wells Fargo to serve as Company's agent
solely for purposes of maintaining the Register as provided in
this Section 2.6, and Company hereby agrees that, to the extent
Wells Fargo serves in such capacity, Wells Fargo and its
officers, directors, employees, agents and affiliates shall
constitute "Indemnitees."
(c) NOTES. If so requested by any Lender by written notice to Company
(with a copy to Administrative Agent) at least two Business Days
prior to the Effective Date, or at any
44
time thereafter, Company shall execute and deliver to such Lender
(and/or, if applicable and if so specified in such notice, to any
Person who is an assignee of such Lender pursuant to Section
10.6) on the Effective Date (or, if such notice is delivered
after the Effective Date, promptly after Company's receipt of
such notice) a Note or Notes to evidence such Lender's Tranche F
Term Loan, Revolving Loan or Swing Line Loan, as the case may be.
2.7 INTEREST ON LOANS.
(a) Except as otherwise set forth herein, each Class of Loan shall
bear interest on the unpaid principal amount thereof from the
date made through repayment (whether by acceleration or
otherwise) thereof as follows:
(i) in the case of Tranche F Term Loans and Revolving Loans:
(1) if a Base Rate Loan, at the Base Rate PLUS the
Applicable Margin; or
(2) if a Eurodollar Rate Loan, at the Adjusted Eurodollar
Rate PLUS the Applicable Margin; and
(ii) in the case of Swing Line Loans, at the Base Rate PLUS the
Applicable Margin.
(b) The basis for determining the rate of interest with respect to
any Loan (except a Swing Line Loan which can be made and
maintained as Base Rate Loans only), and the Interest Period with
respect to any Eurodollar Rate Loan, shall be selected by Company
and notified to Administrative Agent and Lenders pursuant to the
applicable Funding Notice or Conversion/Continuation Notice, as
the case may be. If on any day a Loan is outstanding with respect
to which a Funding Notice or Conversion/Continuation Notice has
not been delivered to Administrative Agent in accordance with the
terms hereof specifying the applicable basis for determining the
rate of interest, then for that day such Loan shall be a Base
Rate Loan."
(c) In connection with Eurodollar Rate Loans there shall be no more
than twelve (12) Interest Periods outstanding at any time. In the
event Company fails to specify between a Base Rate Loan or a
Eurodollar Rate Loan in the applicable Funding Notice or
Conversion/Continuation Notice, such Loan (if outstanding as a
Eurodollar Rate Loan) shall be automatically converted into a
Base Rate Loan on the last day of the then-current Interest
Period for such Loan (or if outstanding as a Base Rate Loan will
remain as, or (if not then outstanding) shall be made as, a Base
Rate Loan). In the event Company fails to specify an Interest
Period for any Eurodollar Rate Loan in the applicable Funding
Notice or Conversion/Continuation Notice, Company shall be deemed
to have selected an Interest Period of one month. As soon as
practicable after 10:00 a.m. (New York City time) on each
Interest Rate Determination Date, Administrative Agent shall
determine (which determination shall be prima facie evidence
thereof) the interest rate that shall apply to the Eurodollar
Rate Loans for which an interest rate is then being determined
for the applicable Interest Period and shall promptly give notice
thereof (in writing or by telephone confirmed in writing) to
Company and each Lender.
45
(d) Interest payable pursuant to Section 2.7(a) shall be computed (i)
in the case of Base Rate Loans on the basis of a 365-day or
366-day year, as the case may be, and (ii) in the case of
Eurodollar Rate Loans, on the basis of a 360-day year, in each
case for the actual number of days elapsed in the period during
which it accrues. In computing interest on any Loan, the date of
the making of such Loan or the first day of an Interest Period
applicable to such Loan or, with respect to a Base Rate Loan
being converted from a Eurodollar Rate Loan, the date of
conversion of such Eurodollar Rate Loan to such Base Rate Loan,
as the case may be, shall be included, and the date of payment of
such Loan or the expiration date of an Interest Period applicable
to such Loan or, with respect to a Base Rate Loan being converted
to a Eurodollar Rate Loan, the date of conversion of such Base
Rate Loan to such Eurodollar Rate Loan, as the case may be, shall
be excluded; PROVIDED, if a Loan is repaid on the same day on
which it is made, one day's interest shall be paid on that Loan.
(e) Except as otherwise set forth herein, interest on each Loan shall
be payable in arrears on and to (i) each Interest Payment Date
applicable to that Loan; (ii) any prepayment of that Loan,
whether voluntary or mandatory, to the extent accrued on the
amount being prepaid; and (iii) at maturity, including final
maturity; PROVIDED, HOWEVER, with respect to any voluntary
prepayment of a Revolving Loan that is a Base Rate Loan, accrued
interest shall instead be payable on the applicable Interest
Payment Date.
(f) Company agrees to pay to Issuing Bank, with respect to drawings
honored under any Letter of Credit, interest on the amount paid
by Issuing Bank in respect of each such honored drawing from the
date such drawing is honored to but excluding the date such
amount is reimbursed by or on behalf of Company at a rate equal
to (i) for the period from the date such drawing is honored to
but excluding the applicable Reimbursement Date, the rate of
interest otherwise payable hereunder with respect to Revolving
Loans that are Base Rate Loans, and (ii) from and after the
applicable Reimbursement Date (if not paid by the applicable
Reimbursement Date), a rate which is 2% per annum in excess of
the rate of interest otherwise payable hereunder with respect to
Revolving Loans that are Base Rate Loans.
(g) Interest payable pursuant to Section 2.7(f) shall be computed on
the basis of a 365/366-day year for the actual number of days
elapsed in the period during which it accrues, and shall be
payable on demand or, if no demand is made, on the date on which
the related drawing under a Letter of Credit is reimbursed in
full. Promptly upon receipt by Issuing Bank of any payment of
interest pursuant to Section 2.7(f), Issuing Bank shall
distribute to each Lender, out of the interest received by
Issuing Bank in respect of the period from the date such drawing
is honored to but excluding the date on which Issuing Bank is
reimbursed for the amount of such drawing (including any such
reimbursement out of the proceeds of any Revolving Loans), the
amount that such Lender would have been entitled to receive in
respect of the letter of credit fee that would have been payable
in respect of such Letter of Credit for such period if no drawing
had been honored under such Letter of Credit. In the event
Issuing Bank shall have been reimbursed by Lenders for all or any
portion of such honored drawing, Issuing Bank shall distribute to
each Lender which has paid all amounts payable by it under
Section 2.23(e) with respect to such honored drawing such
Lender's Pro Rata Share of any interest received by Issuing Bank
in respect of that portion of such honored drawing so reimbursed
by Lenders for the period from the date on which Issuing Bank was
so reimbursed by Lenders to but excluding the date on which such
portion of such honored drawing is reimbursed by Company.
46
2.8 CONVERSION/CONTINUATION.
(a) Subject to Section 2.17 and so long as no Default or Event of
Default shall have occurred and then be continuing, Company shall
have the option:
(i) to convert at any time all or any part of any Term Loan or
Revolving Loan equal to $1,000,000 and integral multiples of
$500,000 in excess of that amount from one Type of Loan to
another Type of Loan; PROVIDED, a Eurodollar Rate Loan may
only be converted on the expiration of the Interest Period
applicable to such Eurodollar Rate Loan unless Company shall
pay all amounts due under Section 2.17 in connection with
any such conversion; or
(ii) upon the expiration of any Interest Period applicable to any
Eurodollar Rate Loan, to continue all or any portion of such
Loan equal to $2,000,000 and integral multiples of
$1,000,000 in excess of that amount as a Eurodollar Rate
Loan.
(b) The Company shall deliver a Conversion/Continuation Notice to
Administrative Agent no later than 1:00 p.m. (New York City time)
at least one Business Day in advance of the proposed conversion
date (in the case of a conversion to a Base Rate Loan) and at
least three Business Days in advance of the proposed
conversion/continuation date (in the case of a conversion to, or
a continuation of, a Eurodollar Rate Loan). Except as otherwise
provided herein, a Conversion/Continuation Notice for conversion
to, or continuation of, any Eurodollar Rate Loans (or telephonic
notice in lieu thereof) shall be irrevocable on and after the
related Interest Rate Determination Date, and Company shall be
bound to effect a conversion or continuation in accordance
therewith.
2.9 DEFAULT INTEREST. Upon the occurrence and during the continuance of an
Event of Default described in Section 8.1, the principal amount of all
Loans and, to the extent permitted by applicable law, any interest
payments on the Loans or any fees or other amounts owed hereunder not
paid when due, in each case whether at stated maturity, by notice of
prepayment, by acceleration or otherwise, shall thereafter bear
interest (including post-petition interest in any proceeding under the
Bankruptcy Code or other applicable bankruptcy laws) payable on demand
at a rate that is 2% per annum in excess of the interest rate
otherwise payable hereunder with respect to the applicable Loans (or,
in the case of any such fees and other amounts, at a rate which is 2%
per annum in excess of the interest rate otherwise payable hereunder
for Base Rate Loans); PROVIDED, in the case of Eurodollar Rate Loans,
upon the expiration of the Interest Period in effect at the time any
such increase in interest rate is effective such Eurodollar Rate Loans
shall thereupon become Base Rate Loans and shall thereafter bear
interest payable upon demand at a rate which is 2% per annum in excess
of the interest rate otherwise payable hereunder for Base Rate Loans.
Payment or acceptance of the increased rates of interest provided for
in this Section 2.9 is not a permitted alternative to timely payment
and shall not constitute a waiver of any Event of Default or otherwise
prejudice or limit any rights or remedies of Administrative Agent or
any Lender.
47
2.10 FEES.
(a) Company agrees to pay to Lenders having Revolving Exposure:
(i) commitment fees equal to (1) the average of the daily
difference between (a) the Revolving Commitments, and (b)
the sum of (x) the aggregate principal amount of outstanding
Revolving Loans (but not any outstanding Swing Line Loans)
plus (y) the Letter of Credit Usage, times (2) the
Applicable Revolving Commitment Fee Percentage; and
(ii) letter of credit fees equal to (1) the Applicable Margin for
Revolving Loans that are Eurodollar Rate Loans, times (2)
the average aggregate daily maximum amount available to be
drawn under all such Letters of Credit (regardless of
whether any conditions for drawing could then be met and
determined as of the close of business on any date of
determination).
(b) Company agrees to pay directly to Issuing Bank, for its own
account, the following fees:
(i) a fronting fee equal to 0.250%, per annum, times the average
aggregate daily maximum amount available to be drawn under
all Letters of Credit (determined as of the close of
business on any date of determination); and
(ii) such documentary and processing charges for any issuance,
amendment, transfer or payment of a Letter of Credit as are
in accordance with Issuing Bank's standard schedule for such
charges and as in effect at the time of such issuance,
amendment, transfer or payment, as the case may be.
(c) All fees referred to in Section 2.10(a) shall be calculated on
the basis of a 360-day year, and the actual number of days
elapsed and shall be payable quarterly in arrears on March 31,
June 30, September 30 and December 31 of each year during the
Revolving Commitment Period, commencing on the first such date to
occur after the Effective Date, and on the Revolving Commitment
Termination Date.
(d) In addition to any of the foregoing fees, Company agrees to pay
to Agents such other fees in the amounts and at the times
separately agreed upon.
2.11 SCHEDULED PAYMENTS. The principal amount of the Term Loans shall be
repaid in consecutive quarterly installments (each, an "INSTALLMENT")
in the aggregate amounts set forth below on the last day of each
Fiscal Quarter (each, an "INSTALLMENT DATE") commencing December 31,
2004:
FISCAL QUARTER ENDING TRANCHE F TERM LOAN
INSTALLMENTS
December 31, 2004 $ 562,500
March 31, 2005 $ 562,500
June 30, 2005 $ 562,500
September 30, 2005 $ 562,500
December 31, 2005 $ 562,500
March 31, 2006 $ 562,500
June 30, 2006 $ 562,500
September 30, 2006 $ 562,500
December 31, 2006 $27,421,875
48
March 31, 2007 $27,421,875
June 30, 2007 $27,421,875
September 30, 2007 $27,421,875
December 31, 2007 $27,421,875
March 31, 2008 $27,421,875
June 30, 2008 $27,421,875
September 30, 2008 $27,421,875
Notwithstanding the foregoing, (y) such Installments shall be reduced in
connection with any voluntary or mandatory prepayments of the Tranche F Term
Loans in accordance with Sections 2.12, 2.13 and 2.14 as applicable; and (z) the
Tranche F Term Loans, together with all other amounts owed hereunder with
respect thereto, shall, in any event, be paid in full no later than the Tranche
F Term Loan Maturity Date.
2.12 VOLUNTARY PREPAYMENTS/COMMITMENT REDUCTIONS.
(a) VOLUNTARY PREPAYMENTS.
(i) Any time and from time to time:
(1) with respect to Base Rate Loans, Company may prepay,
any such Loans on any Business Day in whole or in part,
in an aggregate minimum amount of $1,000,000 and
integral multiples of $500,000 in excess of that
amount;
(2) with respect to Eurodollar Rate Loans, Company may
prepay, any such Loans on any Business Day in whole or
in part in an aggregate minimum amount of $2,000,000
and integral multiples of $1,000,000 in excess of that
amount; and
(3) with respect to Swing Line Loans, Company may prepay,
any such Loans on any Business Day in whole or in part
in an aggregate minimum amount of $100,000, and in
integral multiples of $100,000 in excess of that
amount.
(ii) All such prepayments shall be made:
(1) upon not less than one Business Day's prior written or
telephonic notice in the case of Base Rate Loans;
49
(2) upon not less than three Business Day's prior written
or telephonic notice in the case of Eurodollar Rate
Loans; and
(3) upon written or telephonic notice on the date of
prepayment, in the case of Swing Line Loans;
in each case given to Administrative Agent or Swing Line Lender, as the case may
be, by 1:00 p.m. (New York City time) on the date required and, if given by
telephone, promptly confirmed in writing to Administrative Agent (and
Administrative Agent will promptly transmit such telephonic or original notice
for Term Loans or Revolving Loans, as the case may be, by telefacsimile or
telephone to each Lender) or Swing Line Lender, as the case may be. Upon the
giving of any such notice, the principal amount of the Loans specified in such
notice shall become due and payable on the prepayment date specified therein.
(b) VOLUNTARY COMMITMENT REDUCTIONS.
(i) Company may, upon not less than three Business Days' prior
written or telephonic notice confirmed in writing to
Administrative Agent (which original written or telephonic
notice Administrative Agent will promptly transmit by
telefacsimile or telephone to each applicable Lender), at
any time and from time to time terminate in whole or
permanently reduce in part, without premium or penalty, the
Revolving Commitments in an amount up to the amount by which
the Revolving Commitments exceed the Total Utilization of
Revolving Commitments at the time of such proposed
termination or reduction; PROVIDED, any such partial
reduction of the Revolving Commitments shall be in an
aggregate minimum amount of $5,000,000 and integral
multiples of $1,000,000 in excess of that amount.
(ii) Company's notice to Administrative Agent shall designate the
date (which shall be a Business Day) of such termination or
reduction and the amount of any partial reduction, and such
termination or reduction of the Revolving Commitments shall
be effective on the date specified in Company's notice and
shall reduce the Revolving Commitment of each Lender
proportionately to its Pro Rata Share thereof.
2.13 MANDATORY PREPAYMENTS/COMMITMENT REDUCTIONS.
(a) ASSET SALES. No later than the first Business Day following the
date of receipt by Holdings or any of its Subsidiaries of any Net
Asset Sale Proceeds, Company shall prepay the Loans and/or the
Revolving Commitments shall be permanently reduced as set forth
in Section 2.14(b) in an aggregate amount equal to such Net Asset
Sale Proceeds; PROVIDED, (i) so long as no Default or Event of
Default shall have occurred and be continuing, and (ii) to the
extent that aggregate Net Asset Sale Proceeds from the Closing
Date through the applicable date of determination do not exceed
$10,000,000, Company shall have the option, directly or through
one or more of its Subsidiaries, to invest Net Asset Sale
Proceeds within two hundred seventy (270) days of receipt thereof
in long term productive assets of the general type used in the
business of Company and its Subsidiaries; PROVIDED FURTHER,
pending any such investment all such Net Asset Sale Proceeds
shall be applied to prepay Revolving Loans to the extent
outstanding (without a reduction in Revolving Commitments).
Notwithstanding any of the foregoing to the contrary, upon
receipt by Company of Net Asset Sale Proceeds pursuant to the
50
sale of assets permitted under Section 6.9(d), Company may invest
the first $1,000,000 of such proceeds directly or through one or
more of its Subsidiaries in long-term productive assets of the
general type used in the business of Company and its
Subsidiaries, and the remainder of such Net Asset Sale Proceeds
shall be applied in accordance with the provisions set forth
above.
(b) INSURANCE/CONDEMNATION PROCEEDS. No later than the first Business
Day following the date of receipt by Holdings or any of its
Subsidiaries, or Administrative Agent as loss payee, of any Net
Insurance/Condemnation Proceeds, Company shall prepay the Loans
and/or the Revolving Commitments shall be permanently reduced as
set forth in Section 2.14(b) in an aggregate amount equal to such
Net Insurance/Condemnation Proceeds; PROVIDED, (i) so long as no
Default or Event of Default shall have occurred and be
continuing, and (ii) to the extent that aggregate Net
Insurance/Condemnation Proceeds from the Closing Date through the
applicable date of determination do not exceed $10,000,000,
Company shall have the option, directly or through one or more of
its Subsidiaries to invest such Net Insurance/Condemnation
Proceeds within two hundred seventy (270) days of receipt thereof
in long term productive assets of the general type used in the
business of Holdings and its Subsidiaries, which investment may
include the repair, restoration or replacement of the applicable
assets thereof; provided FURTHER, pending any such investment all
such Net Insurance/Condemnation Proceeds, as the case may be,
shall be applied to prepay Revolving Loans to the extent
outstanding (without a reduction in Revolving Commitments).
(c) ISSUANCE OF EQUITY SECURITIES. On the date of receipt by Holdings
or Company of any Cash proceeds from a capital contribution to,
or the issuance of any Capital Stock of, or the sale of any
Capital Stock of, Holdings or any of its Subsidiaries (other than
(i) any such capital contribution by, or issuance made to Sponsor
or any Co-Investor or any of their Affiliates or a Permitted
Investor or any of their Affiliates; (ii) pursuant to any
employee stock or stock option compensation plan; or (iii)
issuances pursuant to any Take Out Securities), Company shall
prepay the Loans and/or the Revolving Commitments shall be
permanently reduced as set forth in Section 2.14(b) in an
aggregate amount equal to 75% of such proceeds, net of
underwriting discounts and commissions and other reasonable costs
and expenses associated therewith, including reasonable legal
fees and expenses; PROVIDED, HOWEVER, that notwithstanding any of
the foregoing to the contrary set forth in this Section 2.13(c),
to the extent Holdings, Company and/or any of their Subsidiaries
receives any Cash proceeds from the issuance of Capital Stock or
the sale of Capital Stock of any of Holdings' Subsidiaries in
connection with the creation of a Permitted Partially-Owned
Subsidiary, Holdings or Company shall on an annual basis
commencing December 31, 2001, apply the aggregate amount of such
Cash proceeds received, to the extent such aggregate amount
exceeds $250,000 per annum to prepay the Loans and/or reduce the
Revolving Commitments in accordance with Section 2.14(b).
(d) ISSUANCE OF DEBT. On the date of receipt by Holdings or any of
its Subsidiaries of any Cash proceeds from incurrence of any
Indebtedness of Holdings or any of its Subsidiaries (other than
with respect to any Indebtedness permitted to be incurred
pursuant to Section 6.1), Company shall prepay the Loans and/or
the Revolving Commitments shall be permanently reduced as set
forth in Section 2.14(b) in an aggregate amount equal to 100% of
such proceeds, net of underwriting discounts and commissions and
other reasonable costs and expenses associated therewith,
including reasonable legal fees and expenses.
51
(e) CONSOLIDATED EXCESS CASH FLOW. In the event that there shall be
Consolidated Excess Cash Flow for any Fiscal Year (commencing
with the Fiscal Year ending December 31, 2001), Company shall, no
later than one hundred (100) days after the end of such Fiscal
Year, prepay the Loans and/or the Revolving Commitments shall be
permanently reduced as set forth in Section 2.14(b) in an
aggregate amount equal to 75% of such Consolidated Excess Cash
Flow.
(f) REVOLVING LOANS AND SWING LOANS. Company shall from time to time
prepay FIRST, the Swing Line Loans, and SECOND, the Revolving
Loans to the extent necessary so that the Total Utilization of
Revolving Commitments shall not at any time exceed the Revolving
Commitments then in effect.
(g) PREPAYMENT CERTIFICATE. Concurrently with any prepayment of the
Loans and/or reduction of the Revolving Commitments pursuant to
Sections 2.13(a) through 2.13(e), Company shall deliver to
Administrative Agent a certificate of an Authorized Officer
demonstrating the calculation of the amount of the applicable net
proceeds or Consolidated Excess Cash Flow, as the case may be. In
the event that Company shall subsequently determine that the
actual amount received exceeded the amount set forth in such
certificate, Company shall promptly make an additional prepayment
of the Loans and/or the Revolving Commitments shall be
permanently reduced in an amount equal to such excess, and
Company shall concurrently therewith deliver to Administrative
Agent a certificate of an Authorized Officer demonstrating the
derivation of such excess.
(h) EFFECTIVE DATE. Notwithstanding the foregoing, upon receipt of
the Tranche F Term Loans Company shall, without further notice,
prepay in full all outstanding Existing Tranche E Term Loans
other than those Tranche E Term Loans that are held by Continuing
Lenders and are converted to Tranche F Term Loans pursuant to
Section 2.1A(i).
2.14 APPLICATION OF PREPAYMENTS/REDUCTIONS.
(a) APPLICATION OF VOLUNTARY PREPAYMENTS BY TYPE OF LOANS. Any
prepayment of any Loan pursuant to Section 2.12(a) shall be
applied as specified by Company in the applicable notice of
prepayment; PROVIDED, in the event Company fails to specify the
Loans to which any such prepayment shall be applied, such
prepayment shall be applied as follows:
FIRST, to repay outstanding Swing Line Loans to the full
extent thereof;
SECOND, to repay outstanding Revolving Loans to the full
extent thereof;
and
THIRD, to repay the Tranche F Term Loans on a pro rata basis
(in accordance with the outstanding principal amounts) and
shall be further applied on a pro rata basis to each
scheduled Installment of principal of the Tranche F Term
Loans.
52
Any prepayment of Tranche F Term Loan pursuant to Section 2.12(a) shall be
further applied on an pro rata basis to reduce the scheduled remaining
installments of principal on Tranche F Term Loans.
(b) APPLICATION OF MANDATORY PREPAYMENTS BY TYPE OF LOANS. Any amount
required to be paid pursuant to Sections 2.13(a) through 2.13(e)
shall be applied as follows:
FIRST, to prepay Tranche F Term Loans on a pro rata basis
(in accordance with the outstanding principal amounts) and
shall be further applied on a pro rata basis to each
scheduled Installment of principal of the Tranche F Term
Loans;
SECOND, to prepay the Swing Line Loans to the full extent
thereof and to permanently reduce the Revolving Commitments
by the amount of such prepayment;
THIRD, to prepay the Revolving Loans to the full extent
thereof and to further permanently reduce the Revolving
Commitments by the amount of such prepayment;
FOURTH, to prepay outstanding reimbursement obligations with
respect to Letters of Credit and to further permanently
reduce the Revolving Commitments by the amount of such
prepayment;
FIFTH, to cash collateralize Letters of Credit and to
further permanently reduce the Revolving Commitments by the
amount of such cash collateralization; and
SIXTH, to further permanently reduce the Revolving
Commitments to the full extent thereof.
2.15 GENERAL PROVISIONS REGARDING PAYMENTS.
(a) All payments by Company of principal, interest, fees and other
Obligations shall be made in Dollars in same day funds, without
defense, setoff or counterclaim, free of any restriction or
condition, and delivered to Administrative Agent not later than
1:00 p.m. (New York City time) on the date due at the
Administrative Agent's Principal Office for the account of
Lenders; funds received by Administrative Agent after that time
on such due date shall be deemed to have been paid by Company on
the next succeeding Business Day.
(b) All payments in respect of the principal amount of any Loan
(other than voluntary prepayments of Revolving Loans) shall
include payment of accrued interest on the principal amount being
repaid or prepaid, and all such payments (and, in any event, any
payments in respect of any Loan on a date when interest is due
and payable with respect to such Loan) shall be applied to the
payment of interest before application to principal.
(c) Administrative Agent shall promptly distribute to each Lender at
such address as such Lender shall indicate in writing, such
Lender's applicable Pro Rata Share of all payments and
prepayments of principal and interest due hereunder, together
with all other
53
amounts due thereto, including, without limitation, all fees
payable with respect thereto, to the extent received by
Administrative Agent.
(d) Notwithstanding the foregoing provisions hereof, if any
Conversion/Continuation Notice is withdrawn as to any Affected
Lender or if any Affected Lender makes Base Rate Loans in lieu of
its Pro Rata Share of any Eurodollar Rate Loans, Administrative
Agent shall give effect thereto in apportioning payments received
thereafter.
(e) Subject to the provisos set forth in the definition of "Interest
Period", whenever any payment to be made hereunder shall be
stated to be due on a day that is not a Business Day, such
payment shall be made on the next succeeding Business Day and
such extension of time shall be included in the computation of
the payment of interest hereunder or of the Revolving Commitment
fees hereunder.
(f) Company hereby authorizes Administrative Agent to charge
Company's accounts with Administrative Agent in order to cause
timely payment to be made to Administrative Agent of all
principal, interest, fees and expenses due hereunder (subject to
sufficient funds being available in its accounts for that
purpose).
(g) Administrative Agent shall deem any payment by or on behalf of
Company hereunder that is not made in same day funds prior to
1:00 p.m. (New York City time) to be a non-conforming payment.
Any such payment shall not be deemed to have been received by
Administrative Agent until the later of (i) the time such funds
become available funds, and (ii) the applicable next Business
Day. Administrative Agent shall give prompt telephonic notice to
Company and each applicable Lender (confirmed in writing) if any
payment is non-conforming. Any non-conforming payment may
constitute or become a Default or Event of Default in accordance
with the terms of Section 8.1(a). Interest shall continue to
accrue on any principal as to which a non-conforming payment is
made until such funds become available funds (but in no event
less than the period from the date of such payment to the next
succeeding applicable Business Day) at the rate determined
pursuant to Section 2.9 from the date such amount was due and
payable until the date such amount is paid in full.
(h) If an Event of Default shall have occurred and not otherwise been
waived, and the maturity of the Obligations shall have been
accelerated pursuant to Section 8.1, all payments or proceeds
received by Agents hereunder in respect of any of the
Obligations, shall be applied in accordance with the application
arrangements described in Section 6.5 of the Pledge and Security
Agreement.
2.16 RATABLE SHARING. Lenders hereby agree among themselves that, except as
otherwise provided in the Collateral Documents with respect to amounts
realized from the exercise of rights with respect to Liens on the
Collateral, if any of them shall, whether by voluntary payment (other
than a voluntary prepayment of Loans made and applied in accordance
with the terms hereof), through the exercise of any right of set-off
or banker's lien, by counterclaim or cross action or by the
enforcement of any right under the Credit Documents or otherwise, or
as adequate protection of a deposit treated as cash collateral under
the Bankruptcy Code, receive payment or reduction of a proportion of
the aggregate amount of principal, interest, fees and other amounts
then due and owing to such Lender hereunder or under the other
54
Credit Documents (collectively, the "AGGREGATE AMOUNTS DUE" to such
Lender) which is greater than the proportion received by any other
Lender in respect of the Aggregate Amounts Due to such other Lender,
then the Lender receiving such proportionately greater payment shall
(a) notify Administrative Agent and each other Lender of the receipt
of such payment and (b) apply a portion of such payment to purchase
participations (which it shall be deemed to have purchased from each
seller of a participation simultaneously upon the receipt by such
seller of its portion of such payment) in the Aggregate Amounts Due to
the other Lenders so that all such recoveries of Aggregate Amounts Due
shall be shared by all Lenders in proportion to the Aggregate Amounts
Due to them; PROVIDED, if all or part of such proportionately greater
payment received by such purchasing Lender is thereafter recovered
from such Lender upon the bankruptcy or reorganization of Company or
otherwise, those purchases shall be rescinded and the purchase prices
paid for such participations shall be returned to such purchasing
Lender ratably to the extent of such recovery, but without interest.
Company expressly consents to the foregoing arrangement and agrees
that any holder of a participation so purchased may exercise any and
all rights of banker's lien, set-off or counterclaim with respect to
any and all monies owing by Company to that holder with respect
thereto as fully as if that holder were owed the amount of the
participation held by that holder.
2.17 MAKING OR MAINTAINING EURODOLLAR RATE LOANS.
(a) INABILITY TO DETERMINE APPLICABLE INTEREST RATE. In the event
that Administrative Agent shall have determined (which
determination shall be prima facie evidence thereof), on any
Interest Rate Determination Date with respect to any Eurodollar
Rate Loans, that by reason of circumstances affecting the London
interbank market adequate and fair means do not exist for
ascertaining the interest rate applicable to such Loans on the
basis provided for in the definition of Adjusted Eurodollar Rate,
Administrative Agent shall on such date give notice (by
telefacsimile or by telephone confirmed in writing) to Company
and each Lender of such determination, whereupon (i) no Loans may
be made as, or converted to, Eurodollar Rate Loans until such
time as Administrative Agent notifies Company and Lenders that
the circumstances giving rise to such notice no longer exist, and
(ii) any Funding Notice or Conversion/Continuation Notice given
by Company with respect to the Loans in respect of which such
determination was made shall be deemed to be rescinded by
Company.
(b) ILLEGALITY OR IMPRACTICABILITY OF EURODOLLAR RATE LOANS. In the
event that on any date any Lender shall have determined (which
determination shall be prima facie evidence thereof, but shall be
made only after consultation with Company and Administrative
Agent) that the making, maintaining or continuation of its
Eurodollar Rate Loans (i) has become unlawful as a result of
compliance by such Lender in good faith with any law, treaty,
governmental rule, regulation, guideline or order (or would
conflict with any such treaty, governmental rule, regulation,
guideline or order not having the force of law even though the
failure to comply therewith would not be unlawful), or (ii) has
become impracticable, as a result of contingencies occurring
after the date hereof which materially and adversely affect the
London interbank market or the position of such Lender in that
market, then, and in any such event, such Lender shall be an
"AFFECTED LENDER" and it shall on that day give notice (by
telefacsimile or by telephone confirmed in writing) to Company
and Administrative Agent of such determination (which notice
Administrative Agent shall promptly transmit to each other
Lender). Thereafter (1) the obligation of the Affected Lender to
make Loans as, or to convert
55
Loans to, Eurodollar Rate Loans shall be suspended until such
notice shall be withdrawn by the Affected Lender, (2) to the
extent such determination by the Affected Lender relates to a
Eurodollar Rate Loan then being requested by Company pursuant to
a Funding Notice or a Conversion/Continuation Notice, the
Affected Lender shall make such Loan as (or continue such Loan as
or convert such Loan to, as the case may be) a Base Rate Loan,
(3) the Affected Lender's obligation to maintain its outstanding
Eurodollar Rate Loans (the "AFFECTED LOANS") shall be terminated
at the earlier to occur of the expiration of the Interest Period
then in effect with respect to the Affected Loans or when
required by law, and (4) the Affected Loans shall automatically
convert into Base Rate Loans on the date of such termination.
Notwithstanding the foregoing, to the extent a determination by
an Affected Lender as described above relates to a Eurodollar
Rate Loan then being requested by Company pursuant to a Funding
Notice or a Conversion/Continuation Notice, Company shall have
the option, subject to the provisions of Section 2.17(c), to
rescind such Funding Notice or Conversion/Continuation Notice as
to all Lenders by giving notice (by telefacsimile or by telephone
confirmed in writing) to Administrative Agent of such rescission
on the date on which the Affected Lender gives notice of its
determination as described above (which notice of rescission
Administrative Agent shall promptly transmit to each other
Lender). Except as provided in the immediately preceding
sentence, nothing in this Section 2.17(b) shall affect the
obligation of any Lender other than an Affected Lender to make or
maintain Loans as, or to convert Loans to, Eurodollar Rate Loans
in accordance with the terms hereof.
(c) COMPENSATION FOR BREAKAGE OR NON-COMMENCEMENT OF INTEREST
PERIODS. Company shall compensate each Lender, upon written
request by such Lender (which request shall set forth the basis
for requesting such amounts), for all reasonable losses, expenses
and liabilities (including any interest paid by such Lender to
lenders of funds borrowed by it to make or carry its Eurodollar
Rate Loans and any loss, expense or liability sustained by such
Lender in connection with the liquidation or re-employment of
such funds but excluding loss of anticipated profits) which such
Lender may sustain: (i) if for any reason (other than a default
by such Lender) a borrowing of any Eurodollar Rate Loan does not
occur on a date specified ~therefore in a Funding Notice or a
telephonic request for borrowing, or a conversion to or
continuation of any Eurodollar Rate Loan does not occur on a date
specified ~therefore in a Conversion/Continuation Notice or a
telephonic request for conversion or continuation; (ii) if any
prepayment or other principal payment or any conversion of any of
its Eurodollar Rate Loans occurs on a date prior to the last day
of an Interest Period applicable to that Loan; or (iii) if any
prepayment of any of its Eurodollar Rate Loans is not made on any
date specified in a notice of prepayment given by Company.
(d) BOOKING OF EURODOLLAR RATE LOANS. Any Lender may make, carry or
transfer Eurodollar Rate Loans at, to, or for the account of any
of its branch offices or the office of an Affiliate of such
Lender.
(e) ASSUMPTIONS CONCERNING FUNDING OF EURODOLLAR RATE LOANS.
Calculation of all amounts payable to a Lender under this Section
2.17 and under Section 2.18 shall be made as though such Lender
had actually funded each of its relevant Eurodollar Rate Loans
through the purchase of a Eurodollar deposit bearing interest at
the rate obtained pursuant to clause (i) of the definition of
Adjusted Eurodollar Rate in an amount equal to the amount of such
Eurodollar Rate Loan and having a maturity comparable to the
relevant Interest Period and through the
56
transfer of such Eurodollar deposit from an offshore office of
such Lender to a domestic office of such Lender in the United
States of America; PROVIDED, HOWEVER, each Lender may fund each
of its Eurodollar Rate Loans in any manner it sees fit and the
foregoing assumptions shall be utilized only for the purposes of
calculating amounts payable under this Section 2.17 and under
Section 2.18.
2.18 INCREASED COSTS; CAPITAL ADEQUACY.
(a) COMPENSATION FOR INCREASED COSTS AND TAXES. Subject to the
provisions of Section 2.19 (which shall be controlling with
respect to the matters covered thereby), in the event that any
Lender (which term shall include Issuing Bank for purposes of
this Section 2.18(a)) shall determine (which determination shall
be prima facie evidence thereof) that any law, treaty or
governmental rule, regulation or order, or any change therein or
in the interpretation, administration or application thereof
(including the introduction of any new law, treaty or
governmental rule, regulation or order), or any determination of
a court or governmental authority, in each case that becomes
effective after the date hereof, or compliance by such Lender
with any guideline, request or directive issued or made after the
date hereof by any central bank or other governmental or
quasi-governmental authority (whether or not having the force of
law): (i) subjects such Lender (or its applicable lending office)
to any additional Tax (other than any Tax on the overall net
income of such Lender) with respect to this Agreement or any of
the other Credit Documents or any of its obligations hereunder or
thereunder or any payments to such Lender (or its applicable
lending office) of principal, interest, fees or any other amount
payable hereunder; (ii) imposes, modifies or holds applicable any
reserve (including any marginal, emergency, supplemental, special
or other reserve), special deposit, compulsory loan, FDIC
insurance or similar requirement against assets held by, or
deposits or other liabilities in or for the account of, or
advances or loans by, or other credit extended by, or any other
acquisition of funds by, any office of such Lender (other than
any such reserve or other requirements with respect to Eurodollar
Rate Loans that are reflected in the definition of Adjusted
Eurodollar Rate); or (iii) imposes any other condition (other
than with respect to a Tax matter) on or affecting such Lender
(or its applicable lending office) or its obligations hereunder
or the London interbank market; and the result of any of the
foregoing is to increase the cost to such Lender of agreeing to
make, making or maintaining Loans hereunder or to reduce any
amount received or receivable by such Lender (or its applicable
lending office) with respect thereto; then, in any such case,
Company shall promptly pay to such Lender, upon receipt of the
statement referred to in the next sentence, such additional
amount or amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such
Lender in its sole discretion shall determine) as may be
necessary to compensate such Lender for any such increased cost
or reduction in amounts received or receivable hereunder. Such
Lender shall deliver to Company (with a copy to Administrative
Agent) a written statement, setting forth in reasonable detail
the basis for calculating the additional amounts owed to such
Lender under this Section 2.18(a), which statement shall be prima
facie evidence thereof.
(b) CAPITAL ADEQUACY ADJUSTMENT. In the event that any Lender (which
term shall include Issuing Bank for purposes of this Section
2.18(b)) shall have determined that the adoption, effectiveness,
phase-in or applicability after the Effective Date of any law,
rule or regulation (or any provision thereof) regarding capital
adequacy, or any change therein or in the interpretation or
administration thereof by any Governmental Authority, central
bank or
57
comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or its
applicable lending office) with any guideline, request or
directive regarding capital adequacy (whether or not having the
force of law) of any such Governmental Authority, central bank or
comparable agency, has or would have the effect of reducing the
rate of return on the capital of such Lender or any corporation
controlling such Lender as a consequence of, or with reference
to, such Lender's Loans or Revolving Commitments, or
participations therein or other obligations hereunder with
respect to the Loans to a level below that which such Lender or
such controlling corporation could have achieved but for such
adoption, effectiveness, phase-in, applicability, change or
compliance (taking into consideration the policies of such Lender
or such controlling corporation with regard to capital adequacy),
then from time to time, within five Business Days after receipt
by Company from such Lender of the statement referred to in the
next sentence, Company shall pay to such Lender such additional
amount or amounts as will compensate such Lender or such
controlling corporation on an after-tax basis for such reduction.
Such Lender shall deliver to Company (with a copy to
Administrative Agent) a written statement, setting forth in
reasonable detail the basis for calculating the additional
amounts owed to Lender under this Section 2.18(b), which
statement shall be prima facie evidence thereof.
2.19 TAXES; WITHHOLDING, ETC.
(a) PAYMENTS TO BE FREE AND CLEAR. All sums payable by any Credit
Party hereunder and under the other Credit Documents shall
(except to the extent required by law) be paid free and clear of,
and without any deduction or withholding on account of, any Tax
(other than a franchise Tax or a Tax on the overall net income of
any Lender) imposed, levied, collected, withheld or assessed by
or within the United States of America or any political
subdivision in or of the United States of America or any other
jurisdiction from or to which a payment is made by or on behalf
of any Credit Party.
(b) WITHHOLDING OF TAXES. If any Credit Party or any other Person is
required by law to make any deduction or withholding on account
of any such Tax from any sum paid or payable by any Credit Party
to Administrative Agent or any Lender (which term shall include
Issuing Bank for purposes of this Section 2.19(b)) under any of
the Credit Documents: (i) Company shall notify Administrative
Agent of any such requirement or any change in any such
requirement as soon as Company becomes aware of it; (ii) Company
shall pay any such Tax before the date on which penalties attach
thereto, such payment to be made (if the liability to pay is
imposed on any Credit Party) for its own account or (if that
liability is imposed on Administrative Agent or such Lender, as
the case may be) on behalf of and in the name of Administrative
Agent or such Lender; (iii) the sum payable by such Credit Party
in respect of which the relevant deduction, withholding or
payment is required shall be increased to the extent necessary to
ensure that, after the making of that deduction, withholding or
payment, Administrative Agent or such Lender, as the case may be,
receives on the due date a net sum equal to what it would have
received had no such deduction, withholding or payment been
required or made; and (iv) within thirty (30) days after paying
any sum from which it is required by law to make any deduction or
withholding, and within thirty (30) days after the due date of
payment of any Tax which it is required by clause (ii) above to
pay, Company shall deliver to Administrative Agent evidence
satisfactory to the other affected parties of such deduction,
withholding or payment and of the remittance thereof to the
relevant taxing or other authority; PROVIDED, no such additional
amount shall be required to be paid to any Lender or
Administrative
58
Agent under clause (iii) above except to the extent that any
change after the date hereof (in the case of each Lender listed
on the signature pages hereof on the Effective Date) or after the
effective date of the Assignment Agreement pursuant to which such
Lender became a Lender (in the case of each other Lender) in any
requirement mentioned therein for a deduction, withholding or
payment shall result in an increase in the rate of such
deduction, withholding or payment from that in effect at the date
hereof or at the date of such Assignment Agreement, as the case
may be, in respect of payments to such Lender or Administrative
Agent.
(c) EVIDENCE OF EXEMPTION FROM U.S. WITHHOLDING TAX(i). (i) Each
Lender that is not a United States Person (as such term is
defined in Section 7701(a)(30) of the Internal Revenue Code) for
U.S. federal income tax purposes (a "NON-US LENDER") shall
deliver to Administrative Agent for transmission to Company, on
or prior to the Effective Date (in the case of each Lender listed
on the signature pages hereof on the Effective Date) or on or
prior to the date of the Assignment Agreement pursuant to which
it becomes a Lender (in the case of each other Lender), and at
such other times as may be necessary in the determination of
Company or Administrative Agent (each in the reasonable exercise
of its discretion), (A) two original copies of Internal Revenue
Service Form W-8BEN or W-8ECI (or any successor forms), properly
completed and duly executed by such Lender, and such other
documentation required under the Internal Revenue Code and
reasonably requested by Company to establish that such Lender is
not subject to deduction or withholding of United States federal
income tax with respect to any payments to such Lender of
principal, interest, fees or other amounts payable under any of
the Credit Documents, or (B) if such Lender is not a "bank" or
other Person described in Section 881(c)(3) of the Internal
Revenue Code and cannot deliver either Internal Revenue Service
Form W-8BEN or W-8ECI pursuant to clause (A) above, a Certificate
re Non-Bank Status together with two original copies of Internal
Revenue Service Form W-8 (or any successor form), properly
completed and duly executed by such Lender, and such other
documentation required under the Internal Revenue Code and
reasonably requested by Company to establish that such Lender is
not subject to deduction or withholding of United States federal
income tax with respect to any payments to such Lender of
interest payable under any of the Credit Documents. Each Lender
required to deliver any forms, certificates or other evidence
with respect to United States federal income tax withholding
matters pursuant to this Section 2.19(c) hereby agrees, from time
to time after the initial delivery by such Lender of such forms,
certificates or other evidence, whenever a lapse in time or
change in circumstances renders such forms, certificates or other
evidence obsolete or inaccurate in any material respect, that
such Lender shall promptly deliver to Administrative Agent for
transmission to Company two new original copies of Internal
Revenue Service Form W-8BEN or W-8ECI , or a Certificate re
Non-Bank Status and two original copies of Internal Revenue
Service Form W-8, as the case may be, properly completed and duly
executed by such Lender, and such other documentation required
under the Internal Revenue Code and reasonably requested by
Company to confirm or establish that such Lender is not subject
to deduction or withholding of United States federal income tax
with respect to payments to such Lender under the Credit
Documents, or notify Administrative Agent and Company of its
inability to deliver any such forms, certificates or other
evidence. Company shall not be required to pay any additional
amount to any Non-US Lender under Section 2.19(b)(iii) if such
Lender shall have failed to deliver the forms, certificates or
other evidence referred to in the second sentence of this Section
2.19(c), or (2) to notify Administrative Agent and Company of its
inability to deliver any such forms, certificates or other
evidence, as the case may be; PROVIDED, if such Lender shall have
satisfied the requirements of the first sentence of this
59
Section 2.19(c) on the Effective Date or on the date of the
Assignment Agreement pursuant to which it became a Lender, as
applicable, nothing in this last sentence of Section 2.19(c)
shall relieve Company of its obligation to pay any additional
amounts pursuant to Section 2.18(a) in the event that, as a
result of any change in any applicable law, treaty or
governmental rule, regulation or order, or any change in the
interpretation, administration or application thereof, such
Lender is no longer properly entitled to deliver forms,
certificates or other evidence at a subsequent date establishing
the fact that such Lender is not subject to withholding as
described herein.
(ii) If any non-corporate Lender is a United States Person as
such term is defined in the Internal Revenue Code, such
Lender shall deliver to Administrative Agent on or prior to
the Effective Date or on or prior to the date of the
Assignment Agreement, pursuant to which it becomes a Lender
(in the case of each other Lender) two original copies of
Internal Revenue Service Form W-9 (or any successor forms),
properly completed and duly executed by such Lender and such
other documentation required under the Internal Revenue Code
to establish that such Lender is not subject to deduction or
withholding of United States federal income tax with respect
to such principal, interest, fees or other amounts payable
under the any of the Credit Documents.
2.20 OBLIGATION TO MITIGATE. Each Lender (which term shall include Issuing
Bank for purposes of this Section 2.20) agrees that, as promptly as
practicable after the officer of such Lender responsible for
administering its Loans becomes aware of the occurrence of an event or
the existence of a condition that would cause such Lender to become an
Affected Lender or that would entitle such Lender to receive payments
under Section 2.17, 2.18 or 2.19, it will, to the extent not
inconsistent with the internal policies of such Lender and any
applicable legal or regulatory restrictions, use reasonable efforts to
(a) make, issue, fund or maintain its Credit Extensions, including any
Affected Loans, through another office of such Lender, or (b) take
such other measures as such Lender may deem reasonable, if as a result
thereof the circumstances which would cause such Lender to be an
Affected Lender would cease to exist or the additional amounts which
would otherwise be required to be paid to such Lender pursuant to
Section 2.17, 2.18 or 2.19 would be materially reduced and if, as
determined by such Lender in its sole but reasonable discretion, the
making, issuing, funding or maintaining of such Revolving Commitments
or Loans through such other office or in accordance with such other
measures, as the case may be, would not otherwise adversely affect
such Revolving Commitments or Loans or the interests of such Lender;
PROVIDED, such Lender will not be obligated to utilize such other
office pursuant to this Section 2.20 unless Company agrees to pay all
incremental expenses incurred by such Lender as a result of utilizing
such other office as described above. A certificate as to the amount
of any such expenses payable by Company pursuant to this Section 2.20
(setting forth in reasonable detail the basis for requesting such
amount) submitted by such Lender to Company (with a copy to
Administrative Agent) shall be prima facie evidence thereof.
2.21 DEFAULTING LENDERS. Anything contained herein to the contrary
notwithstanding, in the event that any Lender, at the direction or
request of any regulatory agency or authority, defaults (a "DEFAULTING
LENDER") in its obligation to fund (a "FUNDING DEFAULT") any Revolving
Loan or its portion of any unreimbursed payment under Section
2.3(b)(iv) (in each case, a "DEFAULTED LOAN"), then (a) during any
Default Period with respect to such Defaulting Lender, such Defaulting
Lender shall be deemed not to be a "Lender" for purposes of voting on
any
60
matters (including the granting of any consents or waivers) with
respect to any of the Credit Documents; (b) to the extent permitted by
applicable law, until such time as the Default Excess with respect to
such Defaulting Lender shall have been reduced to zero, (i) any
voluntary prepayment of the Revolving Loans shall, if Company so
directs at the time of making such voluntary prepayment, be applied to
the Revolving Loans of other Lenders as if such Defaulting Lender had
no Revolving Loans outstanding and the Revolving Exposure of such
Defaulting Lender were zero, and (ii) any mandatory prepayment of the
Revolving Loans shall, if Company so directs at the time of making
such mandatory prepayment, be applied to the Revolving Loans of other
Lenders (but not to the Revolving Loans of such Defaulting Lender) as
if such Defaulting Lender had funded all Defaulted Loans of such
Defaulting Lender, it being understood and agreed that Company shall
be entitled to retain any portion of any mandatory prepayment of the
Revolving Loans that is not paid to such Defaulting Lender solely as a
result of the operation of the provisions of this clause (b); (c) such
Defaulting Lender's Revolving Commitment and outstanding Revolving
Loans and such Defaulting Lender's Pro Rata Share of the Letter of
Credit Usage shall be excluded for purposes of calculating the
Revolving Commitment fee payable to Lenders in respect of any day
during any Default Period with respect to such Defaulting Lender, and
such Defaulting Lender shall not be entitled to receive any Revolving
Commitment fee pursuant to Section 2.10 with respect to such
Defaulting Lender's Revolving Commitment in respect of any Default
Period with respect to such Defaulting Lender; and (d) the Total
Utilization of Revolving Commitments as at any date of determination
shall be calculated as if such Defaulting Lender had funded all
Defaulted Loans of such Defaulting Lender. No Revolving Commitment of
any Lender shall be increased or otherwise affected, and, except as
otherwise expressly provided in this Section 2.21, performance by
Company of its obligations hereunder and the other Credit Documents
shall not be excused or otherwise modified as a result of any Funding
Default or the operation of this Section 2.21. The rights and remedies
against a Defaulting Lender under this Section 2.21 are in addition to
other rights and remedies which Company may have against such
Defaulting Lender with respect to any Funding Default and which
Administrative Agent or any Lender may have against such Defaulting
Lender with respect to any Funding Default.
2.22 REMOVAL OR REPLACEMENT OF A LENDER. Anything contained herein to the
contrary notwithstanding, in the event that: (a) any Lender (an
"INCREASED-COST LENDER") shall give notice to Company that such Lender
is an Affected Lender or that such Lender is entitled to receive
payments under Section 2.17, 2.18 or 2.19, the circumstances which
have caused such Lender to be an Affected Lender or which entitle such
Lender to receive such payments shall remain in effect, and such
Lender shall fail to withdraw such notice within five Business Days
after Company's request for such withdrawal; or (b) any Lender shall
become a Defaulting Lender, the Default Period for such Defaulting
Lender shall remain in effect, and such Defaulting Lender shall fail
to cure the default as a result of which it has become a Defaulting
Lender within five Business Days after Company's request that it cure
such default; or (c) in connection with any proposed amendment,
modification, termination, waiver or consent with respect to any of
the provisions hereof as contemplated by Section 10.5(b), the consent
of Requisite Lenders shall have been obtained but the consent of one
or more of such other Lenders (each a "NON-CONSENTING LENDER") whose
consent is required shall not have been obtained; then, with respect
to each such Increased-Cost Lender, Defaulting Lender or
Non-Consenting Lender (the "TERMINATED LENDER"), Company may, by
giving written notice to Administrative Agent and any Terminated
Lender of its election to do so, elect to cause such Terminated Lender
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(and such Terminated Lender hereby irrevocably agrees) to assign its
outstanding Loans and its Revolving Commitments, if any, in full to
one or more Eligible Assignees (each a "REPLACEMENT LENDER") in
accordance with the provisions of Section 10.6 and Terminated Lender
shall pay any fees payable thereunder in connection with such
assignment; PROVIDED, (1) on the date of such assignment, the
Replacement Lender shall pay to Terminated Lender an amount equal to
the sum of (A) an amount equal to the principal of, and all accrued
interest on, all outstanding Loans of the Terminated Lender, (B) an
amount equal to all unreimbursed drawing that have been funded by such
Terminated Lender, together with all then unpaid interest with respect
thereto at such time and (C) an amount equal to all accrued, but
theretofore unpaid fees owing to such Terminated Lender pursuant to
Section 2.10; (2) on the date of such assignment, Company shall pay
any amounts payable to such Terminated Lender pursuant to Section
2.17(c), 2.18 or 2.19 or otherwise as if it were a prepayment; and (3)
in the event such Terminated Lender is a Non-Consenting Lender, each
Replacement Lender shall consent, at the time of such assignment, to
each matter in respect of which such Terminated Lender was a
Non-Consenting Lender; PROVIDED, Company may not make such election
with respect to any Terminated Lender that is also an Issuing Bank
unless, prior to the effectiveness of such election, Company shall
have caused each outstanding Letter of Credit issued thereby to be
cancelled. Upon the prepayment of all amounts owing to any Terminated
Lender and the termination of such Terminated Lender's Revolving
Commitments, if any, such Terminated Lender shall no longer constitute
a "Lender" for purposes hereof; PROVIDED, any rights of such
Terminated Lender to indemnification hereunder shall survive as to
such Terminated Lender.
2.23 ISSUANCE OF LETTERS OF CREDIT AND PURCHASE OF PARTICIPATIONS THEREIN.
(a) LETTERS OF CREDIT. During the Revolving Commitment Period,
subject to the terms and conditions hereof, Issuing Bank agrees
to issue Letters of Credit for the account of Company in the
aggregate amount up to but not exceeding the Letter of Credit
Sublimit; PROVIDED, (i) each Letter of Credit shall be
denominated in Dollars; (ii) the stated amount of each Letter of
Credit shall not be less than $10,000 or such lesser amount as is
acceptable to Issuing Bank; (iii) after giving effect to such
issuance, in no event shall the Total Utilization of Revolving
Commitments exceed the Revolving Commitments then in effect; (iv)
after giving effect to such issuance, in no event shall the
Letter of Credit Usage exceed the Letter of Credit Sublimit then
in effect; (v) in no event shall any standby Letter of Credit
have an expiration date later than the earlier of (1) the
Revolving Commitment Termination Date and (2) the date which is
one year from the date of issuance of such standby Letter of
Credit; and (vi) in no event shall any commercial Letter of
Credit (x) have an expiration date later than the earlier of (1)
the Revolving Loan Commitment Termination Date and (2) the date
which is 180 days from the date of issuance of such commercial
Letter of Credit or (b) be issued if such commercial Letter of
Credit is otherwise unacceptable to Issuing Bank in its
reasonable discretion. Subject to the foregoing, Issuing Bank may
agree that a standby Letter of Credit will automatically be
extended for one or more successive periods not to exceed one
year each, unless Issuing Bank elects not to extend for any such
additional period; PROVIDED, Issuing Bank shall not extend any
such Letter of Credit if it has received written notice that an
Event of Default has occurred and is continuing at the time
Issuing Bank must elect to allow such extension; PROVIDED,
FURTHER, in the event a Funding Default exists, Issuing Bank
shall not be required to issue any Letter of Credit unless
Issuing Bank has entered into arrangements satisfactory to it and
Company to eliminate Issuing Bank's risk with respect to the
participation in Letters of Credit of the Defaulting Lender,
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including by cash collateralizing such Defaulting Lender's Pro
Rata Share of the Letter of Credit Usage.
(b) NOTICE OF ISSUANCE. Whenever Company desires the issuance of a
Letter of Credit, it shall deliver to Administrative Agent an
Issuance Notice no later than 12:00 p.m. (New York City time) at
least three Business Days (in the case of standby letters of
credit) or five Business Days (in the case of commercial letters
of credit), or in each case such shorter period as may be agreed
to by Issuing Bank in any particular instance, in advance of the
proposed date of issuance. Upon satisfaction or waiver of the
conditions set forth in Section 3.2, Issuing Bank shall issue the
requested Letter of Credit only in accordance with Issuing Bank's
standard operating procedures. Upon the issuance of any Letter of
Credit or amendment or modification to a Letter of Credit,
Issuing Bank shall promptly notify each Lender of such issuance,
which notice shall be accompanied by a copy of such Letter of
Credit or amendment or modification to a Letter of Credit and the
amount of such Lender's respective participation in such Letter
of Credit pursuant to Section 2.23(e).
(c) RESPONSIBILITY OF ISSUING BANK WITH RESPECT TO REQUESTS FOR
DRAWINGS AND PAYMENTS. In determining whether to honor any
drawing under any Letter of Credit by the beneficiary thereof,
Issuing Bank shall be responsible only to examine the documents
delivered under such Letter of Credit with reasonable care so as
to ascertain whether they appear on their face to be in
accordance with the terms and conditions of such Letter of
Credit. As between Company and Issuing Bank, Company assumes all
risks of the acts and omissions of, or misuse of the Letters of
Credit issued by Issuing Bank, by the respective beneficiaries of
such Letters of Credit. In furtherance and not in limitation of
the foregoing, Issuing Bank shall not be responsible for: (i) the
form, validity, sufficiency, accuracy, genuineness or legal
effect of any document submitted by any party in connection with
the application for and issuance of any such Letter of Credit,
even if it should in fact prove to be in any or all respects
invalid, insufficient, inaccurate, fraudulent or forged; (ii) the
validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any such Letter of
Credit or the rights or benefits thereunder or proceeds thereof,
in whole or in part, which may prove to be invalid or ineffective
for any reason; (iii) failure of the beneficiary of any such
Letter of Credit to comply fully with any conditions required in
order to draw upon such Letter of Credit; (iv) errors, omissions,
interruptions or delays in transmission or delivery of any
messages, by mail, cable, telegraph, telex or otherwise, whether
or not they be in cipher; (v) errors in interpretation of
technical terms; (vi) any loss or delay in the transmission or
otherwise of any document required in order to make a drawing
under any such Letter of Credit or of the proceeds thereof; (vii)
the misapplication by the beneficiary of any such Letter of
Credit of the proceeds of any drawing under such Letter of
Credit; or (viii) any consequences arising from causes beyond the
control of Issuing Bank, including any Governmental Acts; none of
the above shall affect or impair, or prevent the vesting of, any
of Issuing Bank's rights or powers hereunder. Without limiting
the foregoing and in furtherance thereof, any action taken or
omitted by Issuing Bank under or in connection with the Letters
of Credit or any documents and certificates delivered thereunder,
if taken or omitted in good faith, shall not give rise to any
liability on the part of Issuing Bank to Company. Notwithstanding
anything to the contrary contained in this Section 2.23(c),
Company shall retain any and all rights it may have against
Issuing Bank for any liability arising solely out of the gross
negligence or willful misconduct of Issuing Bank.
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(d) REIMBURSEMENT BY COMPANY OF AMOUNTS DRAWN OR PAID UNDER LETTERS
OF CREDIT. In the event Issuing Bank has determined to honor a
drawing under a Letter of Credit, it shall immediately notify
Company and Administrative Agent, and Company shall reimburse
Issuing Bank on or before the Business Day immediately following
the date on which such drawing is honored (the "REIMBURSEMENT
DATE") in an amount in Dollars and in same day funds equal to the
amount of such honored drawing; PROVIDED, anything contained
herein to the contrary notwithstanding, (i) unless Company shall
have notified Administrative Agent and Issuing Bank prior to
10:00 a.m. (New York City time) on the date such drawing is
honored that Company intends to reimburse Issuing Bank for the
amount of such honored drawing with funds other than the proceeds
of Revolving Loans, Company shall be deemed to have given a
timely Funding Notice to Administrative Agent requesting Lenders
to make Revolving Loans that are Base Rate Loans on the
Reimbursement Date in an amount in Dollars equal to the amount of
such honored drawing, and (ii) subject to satisfaction or waiver
of the conditions specified in Section 3.2, Lenders shall, on the
Reimbursement Date, make Revolving Loans that are Base Rate Loans
in the amount of such honored drawing, the proceeds of which
shall be applied directly by Administrative Agent to reimburse
Issuing Bank for the amount of such honored drawing; and PROVIDED
FURTHER, if for any reason proceeds of Revolving Loans are not
received by Issuing Bank on the Reimbursement Date in an amount
equal to the amount of such honored drawing, Company shall
reimburse Issuing Bank, on demand, in an amount in same day funds
equal to the excess of the amount of such honored drawing over
the aggregate amount of such Revolving Loans, if any, which are
so received. Nothing in this Section 2.23(d) shall be deemed to
relieve any Lender from its obligation to make Revolving Loans on
the terms and conditions set forth herein, and Company shall
retain any and all rights it may have against any Lender
resulting from the failure of such Lender to make such Revolving
Loans under this Section 2.23(d).
(e) LENDERS' PURCHASE OF PARTICIPATIONS IN LETTERS OF CREDIT.
Immediately upon the issuance of each Letter of Credit, each
Lender having a Revolving Commitment shall be deemed to have
purchased, and hereby agrees to irrevocably purchase, from
Issuing Bank a participation in such Letter of Credit and any
drawings honored thereunder in an amount equal to such Lender's
Pro Rata Share (with respect to the Revolving Commitments) of the
maximum amount which is or at any time may become available to be
drawn thereunder. In the event that Company shall fail for any
reason to reimburse Issuing Bank as provided in Section 2.23(d),
Issuing Bank shall promptly notify each Lender of the
unreimbursed amount of such honored drawing and of such Lender's
respective participation therein based on such Lender's Pro Rata
Share of the Revolving Commitments. Each Lender shall make
available to Issuing Bank an amount equal to its respective
participation, in Dollars and in same day funds, at the office of
Issuing Bank specified in such notice, not later than 12:00 p.m.
(New York City time) on the first business day (under the laws of
the jurisdiction in which such office of Issuing Bank is located)
after the date notified by Issuing Bank. In the event that any
Lender fails to make available to Issuing Bank on such business
day the amount of such Lender's participation in such Letter of
Credit as provided in this Section 2.23(e), Issuing Bank shall be
entitled to recover such amount on demand from such Lender
together with interest thereon for three Business Days at the
rate customarily used by Issuing Bank for the correction of
errors among banks and thereafter at the Base Rate. Nothing in
this Section 2.23(e) shall be deemed to prejudice the right of
any Lender to recover from Issuing Bank any amounts made
available by such Lender to Issuing Bank pursuant to this Section
in the event that it is determined that the payment with respect
to a Letter
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of Credit in respect of which payment was made by such Lender
constituted gross negligence or willful misconduct on the part of
Issuing Bank. In the event Issuing Bank shall have been
reimbursed by other Lenders pursuant to this Section 2.23(e) for
all or any portion of any drawing honored by Issuing Bank under a
Letter of Credit, such Issuing Bank shall distribute to each
Lender which has paid all amounts payable by it under this
Section 2.23(e) with respect to such honored drawing such
Lender's Pro Rata Share of all payments subsequently received by
Issuing Bank from Company in reimbursement of such honored
drawing when such payments are received. Any such distribution
shall be made to a Lender at its primary address set forth below
its name on Appendix B or at such other address as such Lender
may request.
(f) OBLIGATIONS ABSOLUTE. The obligation of Company to reimburse
Issuing Bank for drawings honored under the Letters of Credit
issued by it and to repay any Revolving Loans made by Lenders
pursuant to Section 2.23(d) and the obligations of Lenders under
Section 2.23(e) shall be unconditional and irrevocable and shall
be paid strictly in accordance with the terms hereof under all
circumstances including any of the following circumstances: (i)
any lack of validity or enforceability of any Letter of Credit;
(ii) the existence of any claim, set-off, defense or other right
which Company or any Lender may have at any time against a
beneficiary or any transferee of any Letter of Credit (or any
Persons for whom any such transferee may be acting), Issuing
Bank, Lender or any other Person or, in the case of a Lender,
against Company, whether in connection herewith, the transactions
contemplated herein or any unrelated transaction (including any
underlying transaction between Company or one of its Subsidiaries
and the beneficiary for which any Letter of Credit was procured);
(iii) any draft or other document presented under any Letter of
Credit proving to be forged, fraudulent, invalid or insufficient
in any respect or any statement therein being untrue or
inaccurate in any respect; (iv) payment by Issuing Bank under any
Letter of Credit against presentation of a draft or other
document which does not substantially comply with the terms of
such Letter of Credit; (v) any adverse change in the business,
operations, properties, assets, condition (financial or
otherwise) or prospects of Holdings or any of its Subsidiaries;
(vi) any breach hereof or any other Credit Document by any party
thereto; (vii) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing; or (viii) the
fact that an Event of Default or a Default shall have occurred
and be continuing; provided, in each case, that payment by
Issuing Bank under the applicable Letter of Credit shall not have
constituted gross negligence or willful misconduct of Issuing
Bank under the circumstances in question.
(g) INDEMNIFICATION. Without duplication of any obligation of Company
under Section 10.2 or 10.3, in addition to amounts payable as
provided herein, Company hereby agrees to protect, indemnify, pay
and save harmless Issuing Bank from and against any and all
claims, demands, liabilities, damages, losses, costs, charges and
expenses (including reasonable fees, expenses and disbursements
of counsel and allocated costs of internal counsel) which Issuing
Bank may incur or be subject to as a consequence, direct or
indirect, of (i) the issuance of any Letter of Credit by Issuing
Bank, other than as a result of (1) the gross negligence or
willful misconduct of Issuing Bank or (2) the wrongful dishonor
by Issuing Bank of a proper demand for payment made under any
Letter of Credit issued by it, or (ii) the failure of Issuing
Bank to honor a drawing under any such Letter of Credit as a
result of any Governmental Act.
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SECTION 3. CONDITIONS PRECEDENT
3.1 EFFECTIVE DATE. The obligation of any Lender to make a Credit
Extension on the Effective Date is subject to the satisfaction, or
waiver in accordance with Section 10.5, of the following conditions on
or before the Effective Date:
(a) CREDIT DOCUMENTS. Administrative Agent shall have received
sufficient copies of each Credit Document originally executed and
delivered by each applicable Credit Party for each Lender.
(b) ORGANIZATIONAL DOCUMENTS; INCUMBENCY. Administrative Agent shall
have received (i) sufficient copies of each Organizational
Document originally executed and delivered by each Credit Party,
as applicable, and, to the extent applicable, certified as of a
recent date by the appropriate governmental official, for each
Lender, each dated the Effective Date or a recent date prior
thereto; PROVIDED that in lieu of delivering each Organizational
Document, the Company may deliver a certificate of an Authorized
Officer certifying that there have been no material amendments to
those Organizational Documents previously delivered to the
Administrative Agent in connection with the Existing Credit
Agreement; (ii) signature and incumbency certificates of the
officers of such Person executing the Credit Documents to which
it is a party; (iii) resolutions of the Board of Directors or
similar governing body of each Credit Party approving and
authorizing the execution, delivery and performance of this
Agreement and the other Credit Documents and the Related
Agreements to which it is a party or by which it or its assets
may be bound as of the Effective Date, certified as of the
Effective Date by its secretary or an assistant secretary as
being in full force and effect without modification or amendment;
and (iv) such other documents as Administrative Agent may
reasonably request.
(c) ORGANIZATIONAL AND CAPITAL STRUCTURE. The organizational
structure and capital structure of Holdings and its Subsidiaries,
shall be as set forth on Schedule 4.1.
(d) GOVERNMENTAL AUTHORIZATIONS AND CONSENTS. Each Credit Party shall
have obtained all Governmental Authorizations and all consents of
other Persons, in each case that are necessary or advisable in
connection with the transactions contemplated by the Credit
Documents and each of the foregoing shall be in full force and
effect and in form and substance reasonably satisfactory to
Syndication Agent and Administrative Agent. All applicable
waiting periods shall have expired without any action being taken
or threatened by any competent authority which would restrain,
prevent or otherwise impose adverse conditions on the
transactions contemplated by the Credit Documents or the
financing thereof and no action, request for stay, petition for
review or rehearing, reconsideration, or appeal with respect to
any of the foregoing shall be pending, and the time for any
applicable agency to take action to set aside its consent on its
own motion shall have expired.
(e) PERSONAL PROPERTY COLLATERAL. In order to create in favor of
Collateral Agent, for the benefit of Secured Parties, a valid and
perfected First Priority security interest in the personal
property Collateral, Collateral Agent shall have received:
(i) evidence satisfactory to the Collateral Agent of the
compliance by each Credit Party of their obligations under
the Pledge and Security Agreement and the other
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Collateral Documents (including, without limitation, their
obligations to execute and deliver UCC financing statements,
originals of securities, instruments and chattel paper and
any agreements governing deposit and/or securities accounts
as provided therein);
(ii) a certificate of an Authorized Officer listing each Credit
Party, together with each Credit Party's jurisdiction of
incorporation, organization or formation and organizational
identification number (if any);
(iii) opinions of counsel (which counsel shall be reasonably
satisfactory to Collateral Agent and Syndication Agent) in
such states as may be reasonably requested by Collateral
Agent and Syndication Agent with respect to the creation and
perfection of the security interests in favor of Collateral
Agent in such Collateral and such other matters governed by
the laws of each jurisdiction in which any Credit Party or
any personal property Collateral is located as Collateral
Agent may reasonably request, in each case in form and
substance reasonably satisfactory to Collateral Agent; and
(iv) evidence that each Credit Party shall have taken or caused
to be taken any other action, executed and delivered or
caused to be executed and delivered any other agreement,
document and instrument and made or caused to be made any
other filing and recording (other than as set forth herein)
reasonably required by Collateral Agent.
(f) EVIDENCE OF INSURANCE. Syndication Agent and Administrative Agent
shall have received a certificate from Holding's insurance broker
or other evidence satisfactory to it that all insurance required
to be maintained pursuant to Section 5.5 is in full force and
effect and that Administrative Agent, for the benefit of Lenders
has been named as additional insured and loss payee thereunder to
the extent required under Section 5.5.
(g) OPINION OF COUNSEL TO CREDIT PARTIES. Lenders and their
respective counsel shall have received originally executed copies
of the favorable written opinion of Akin Gump Strauss Hauer &
Feld, LLP, counsel for Credit Parties, in the form of Exhibit D
and as to such other matters as Administrative Agent or
Syndication Agent may reasonably request, dated as of the
Effective Date and otherwise in form and substance reasonably
satisfactory to Administrative Agent and Syndication Agent.
(h) FEES. Company shall have paid to Syndication Agent and
Administrative Agent, the fees payable on the Effective Date
referred to in Section 2.10(d).
(i) EFFECTIVE DATE CERTIFICATE. Holdings and Company shall have
delivered to Syndication Agent and Administrative Agent an
originally executed Effective Date Certificate, together with all
attachments thereto.
(j) NO LITIGATION. There shall not exist any action, suit,
investigation, litigation or proceeding or other legal or
regulatory developments, pending or threatened in any court or
before any arbitrator or Governmental Authority that, in the
reasonable opinion of Administrative Agent and Syndication Agent,
singly or in the aggregate, materially impairs the transactions
contemplated by the Credit Documents, or that could have a
Material Adverse Effect.
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(k) COMPLETION OF PROCEEDINGS. All partnership, corporate and other
proceedings taken or to be taken in connection with the
transactions contemplated hereby and all documents incidental
thereto not previously found acceptable by Administrative Agent
or Syndication Agent and its counsel shall be satisfactory in
form and substance to Administrative Agent and Syndication Agent
and such counsel, and Administrative Agent, Syndication Agent and
such counsel shall have received all such counterpart originals
or certified copies of such documents as Administrative Agent or
Syndication Agent may reasonably request.
(l) CONSENTS. Company, Holdings, Requisite Lenders (as such term is
defined under the Existing Credit Agreement), and the Tranche F
Term Loan Lenders shall have indicated their consent by the
execution and delivery of the signature pages hereof to the
Administrative Agent.
(m) FUNDING NOTICE. Company shall have delivered to Administrative
Agent a fully executed Funding Notice with respect to the Tranche
F Term Loans to be made on the Effective Date.
(n) DESIGNATED SENIOR DEBT. Company shall take all actions reasonably
requested by Administrative Agent or Syndication Agent to
designate the Obligations hereunder as "Designated Senior Debt"
under the Senior Subordinated Note Documents (such actions to
include, without limitation, (i) a board resolution or action by
unanimous consent designating the Obligations hereunder as
"Designated Senior Debt"; and (ii) a notice to the Trustee under
the Senior Subordinated Note Documents designating the
Obligations hereunder as "Designated Senior Debt").
Each Lender, by delivering its signature page to this Agreement and funding
a Loan on the Effective Date, shall be deemed to have acknowledged receipt of,
and consented to and approved, each Credit Document and each other document
required to be approved by any Agent, Requisite Lenders or Lenders, as
applicable on the Effective Date.
3.2 CONDITIONS TO EACH CREDIT EXTENSION.
(a) CONDITIONS PRECEDENT. The obligation of each Lender to make any
Loan, or Issuing Bank to issue any Letter of Credit, on any
Credit Date, including the Effective Date, are subject to the
satisfaction, or waiver in accordance with Section 10.5, of the
following conditions precedent:
(i) Administrative Agent shall have received a fully executed
and delivered Funding Notice;
(ii) after making the Credit Extensions requested on such Credit
Date, (y) the Total Utilization of Revolving Commitments
shall not exceed the Revolving Commitments then in effect
and (z) with respect to Revolving Loans used to finance
Permitted Acquisitions, after making the Credit Extensions
on such Credit Date, Company shall have $10,000,000 of
unutilized Revolving Commitments available and the Senior
Leverage Ratio determined on a pro forma basis as of the
last day of the Fiscal Quarter most recently ended and
giving effect to the Permitted Acquisition as of such date
shall be not greater than the ratio specified in Section 6.8
with respect to such date LESS 0.125.
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(iii) as of such Credit Date, the representations and warranties
contained herein and in the other Credit Documents shall be
true and correct in all material respects on and as of that
Credit Date to the same extent as though made on and as of
that date, except to the extent such representations and
warranties specifically relate to an earlier date, in which
case such representations and warranties shall have been
true and correct in all material respects on and as of such
earlier date;
(iv) as of such Credit Date, no event shall have occurred and be
continuing or would result from the consummation of the
applicable Credit Extension that would constitute an Event
of Default or a Default; and
(v) on or before the date of issuance of any Letter of Credit,
Administrative Agent shall have received (i) a fully
executed and delivered Issuance Notice, (ii) all other
information required by the applicable Issuance Notice and
(iii) such other documents or information as Issuing Bank
may reasonably require in connection with the issuance of
such Letter of Credit.
(b) NOTICES. Any Notice shall be executed by an Authorized Officer in a
writing delivered to Administrative Agent. In lieu of delivering a
Notice, Company may give Administrative Agent telephonic notice by the
required time of any proposed borrowing, conversion/continuation or
issuance of a Letter of Credit, as the case may be; PROVIDED each such
notice shall be promptly confirmed in writing by delivery of the
applicable Notice to Administrative Agent on or before the applicable
date of borrowing or continuation/conversion. Neither Administrative
Agent nor any Lender shall incur any liability to Company in acting
upon any telephonic notice referred to above that Administrative Agent
believes in good faith to have been given by a duly authorized officer
or other person authorized on behalf of Company or for otherwise
acting in good faith.
SECTION 4. REPRESENTATIONS AND WARRANTIES
In order to induce Lenders and Issuing Bank to enter into this Agreement
and to make each Credit Extension to be made thereby, each Credit Party
represents and warrants to each Lender and Issuing Bank, on the Effective Date
and on each Credit Date, that the following statements are true and correct:
4.1 ORGANIZATION; REQUISITE POWER AND AUTHORITY; QUALIFICATION. Each of
Holdings and its Subsidiaries (a) is duly organized, validly existing
and in good standing under the laws of its jurisdiction of
organization as identified in Schedule 4.1, (b) has all requisite
power and authority to own and operate its properties, to carry on its
business as now conducted and as proposed to be conducted, to enter
into the Credit Documents to which it is a party and to carry out the
transactions contemplated thereby, and (c) is qualified to do business
and in good standing in every jurisdiction where its assets are
located and wherever necessary to carry out its business and
operations, except in jurisdictions where the failure to be so
qualified or in good standing has not had, and could not be reasonably
expected to have, a Material Adverse Effect.
4.2 CAPITAL STOCK AND OWNERSHIP. The Capital Stock of each of Holdings and
its Subsidiaries has been duly authorized and validly issued and is
fully paid and non-assessable.
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Except as set forth on Schedule 4.2, as of the date hereof, there is
no existing option, warrant, call, right, commitment or other
agreement to which Holdings or any of its Subsidiaries is a party
requiring, and there is no membership interest or other Capital Stock
of Holdings or any of its Subsidiaries outstanding which upon
conversion or exchange would require, the issuance by Holdings or any
of its Subsidiaries of any additional membership interests or other
Capital Stock of Holdings or any of its Subsidiaries or other
Securities convertible into, exchangeable for or evidencing the right
to subscribe for or purchase, a membership interest or other Capital
Stock of Holdings or any of its Subsidiaries. Schedule 4.2 correctly
sets forth the ownership interest of Holdings and each of its
Subsidiaries in their respective Subsidiaries as of the Effective
Date.
4.3 DUE AUTHORIZATION. The execution, delivery and performance of the
Credit Documents have been duly authorized by all necessary action on
the part of each Credit Party that is a party thereto.
4.4 NO CONFLICT. The execution, delivery and performance by Credit Parties
of the Credit Documents to which they are parties and the consummation
of the transactions contemplated by the Credit Documents do not and
will not (a) violate any provision of any law or any governmental rule
or regulation applicable to Holdings or any of its Subsidiaries, any
of the Organizational Documents of Holdings or any of its
Subsidiaries, or any order, judgment or decree of any court or other
agency of government binding on Holdings or any of its Subsidiaries
except to the extent such violation could not be reasonably expected
to have a Material Adverse Effect; (b) conflict with, result in a
breach of or constitute (with due notice or lapse of time or both) a
default under any Contractual Obligation of Holdings or any of its
Subsidiaries except to the extent such conflict, breach or default
could not reasonably be expected to have a Material Adverse Effect;
(c) result in or require the creation or imposition of any Lien upon
any of the properties or assets of Holdings or any of its Subsidiaries
(other than any Liens created under any of the Credit Documents in
favor of Collateral Agent, on behalf of Secured Parties); or (d)
require any approval of stockholders, members or partners or any
approval or consent of any Person under any Contractual Obligation of
Holdings or any of its Subsidiaries, except for such approvals or
consents which will be obtained on or before the Effective Date and
disclosed in writing to Lenders and except for any such approvals or
consents the failure of which to obtain will not have a Material
Adverse Effect.
4.5 GOVERNMENTAL CONSENTS. The execution, delivery and performance by
Credit Parties of the Credit Documents to which they are parties and
the consummation of the transactions contemplated by the Credit
Documents do not and will not require any registration with, consent
or approval of, or notice to, or other action to, with or by, any
Governmental Authority except as otherwise set forth in the NPC Merger
Agreement, and except for filings and recordings with respect to the
Collateral to be made, or otherwise delivered to Collateral Agent for
filing and/or recordation, as of the Effective Date.
4.6 BINDING OBLIGATION. Each Credit Document has been duly executed and
delivered by each Credit Party that is a party thereto and is the
legally valid and binding obligation of such Credit Party, enforceable
against such Credit Party in accordance with its respective terms,
except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors' rights
generally or by equitable principles relating to enforceability.
70
4.7 HISTORICAL FINANCIAL STATEMENTS. The Historical Financial Statements
were prepared in conformity with GAAP and fairly present, in all
material respects, the financial position, on a consolidated basis, of
the Persons described in such financial statements as at the
respective dates thereof and the results of operations and cash flows,
on a consolidated basis, of the entities described therein for each of
the periods then ended, subject, in the case of any such unaudited
financial statements, to changes resulting from audit and normal
year-end adjustments. As of the Effective Date, neither Holdings nor
any of its Subsidiaries has any contingent liability or liability for
taxes, long-term lease or unusual forward or long-term commitment that
is not reflected in the most recent financial statements delivered
pursuant to Section 5 of this Agreement or the notes thereto and which
in any such case is material in relation to the business, operations,
properties, assets, condition (financial or otherwise) or prospects of
Holdings and any of its Subsidiaries taken as a whole.
4.8 [RESERVED].
4.9 NO MATERIAL ADVERSE CHANGE. Since December 31, 1999, no event or
change has occurred that has caused or evidences, either in any case
or in the aggregate, a Material Adverse Effect.
4.10 NO RESTRICTED JUNIOR PAYMENTS. Except as set forth in Schedule 4.10,
since December 31, 1999, neither Holdings nor any of its Subsidiaries
has directly or indirectly declared, ordered, paid or made, or set
apart any sum or property for, any Restricted Junior Payment or agreed
to do so except as permitted pursuant to Section 6.5.
4.11 ADVERSE PROCEEDINGS, ETC. There are no Adverse Proceedings,
individually or in the aggregate, that could reasonably be expected to
have a Material Adverse Effect. Neither Holdings nor any of its
Subsidiaries (a) is in violation of any applicable laws (including
Environmental Laws) that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect, or (b) is
subject to or in default with respect to any final judgments, writs,
injunctions, decrees, rules or regulations of any court or any
federal, state, municipal or other governmental department,
commission, board, bureau, agency or instrumentality, domestic or
foreign, that, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
4.12 PAYMENT OF TAXES. Except as otherwise permitted under Section 5.3, all
federal and state income tax returns and all other material tax
returns and reports of Holdings and its Subsidiaries required to be
filed by any of them have been timely filed, and all taxes shown on
such tax returns to be due and payable and all material assessments,
fees and other governmental charges upon Holdings and its Subsidiaries
and upon their respective properties, assets, income, businesses and
franchises which are due and payable have been paid when due and
payable. Holdings knows of no proposed tax assessment against Holdings
or any of its Subsidiaries which is not being actively contested by
Holdings or such Subsidiary in good faith and by appropriate
proceedings; PROVIDED, such reserves or other appropriate provisions,
if any, as shall be required in conformity with GAAP shall have been
made or provided ~therefore.
71
4.13 PROPERTIES.
(a) TITLE. Each of Holdings and its Subsidiaries has (i) good,
sufficient and marketable legal title to (in the case of fee
interests in real property), (ii) valid leasehold interests in
(in the case of leasehold interests in real or personal
property), and (iii) good title to (in the case of all other
personal property), all of their respective properties and assets
reflected in their respective Historical Financial Statements
referred to in Section 4.7 and in the most recent financial
statements delivered pursuant to Section 5.1, in each case except
for assets disposed of since the date of such financial
statements in the ordinary course of business or as otherwise
permitted under Section 6.9. Except as permitted by this
Agreement, all such properties and assets are free and clear of
Liens.
(b) REAL ESTATE. As of the Closing Date, Schedule 4.13 contains a
true, accurate and complete list of (i) all Real Estate Assets,
and (ii) all leases, subleases or assignments of leases (together
with all amendments, modifications, supplements, renewals or
extensions of any thereof) affecting each Real Estate Asset of
any Credit Party, regardless of whether such Credit Party is the
landlord or tenant (whether directly or as an assignee or
successor in interest) under such lease, sublease or assignment.
Each agreement listed in clause (ii) of the immediately preceding
sentence is in full force and effect and Holdings does not have
knowledge of any default that has occurred and is continuing
thereunder, and each such agreement constitutes the legally valid
and binding obligation of each applicable Credit Party,
enforceable against such Credit Party in accordance with its
terms, except as enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating
to or limiting creditors' rights generally or by equitable
principles.
4.14 ENVIRONMENTAL MATTERS. Neither Holdings nor any of its Subsidiaries
nor any of their respective Facilities or operations are subject to
any outstanding written order, consent decree or settlement agreement
with any Person relating to any Environmental Law, any Environmental
Claim, to the knowledge of Holdings or any of its Subsidiaries, or any
Hazardous Materials Activity that, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect.
Neither Holdings nor any of its Subsidiaries has received any letter
or request for information under Section 104 of the Comprehensive
Environmental Response, Compensation, and Liability Act (42 U.S.C. ss.
9604) or any comparable state law. There are and, to each of Holdings'
and its Subsidiaries' knowledge, have been, no conditions,
occurrences, or Hazardous Materials Activities which could reasonably
be expected to form the basis of an Environmental Claim against
Holdings or any of its Subsidiaries that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse
Effect. Neither Holdings nor any of its Subsidiaries nor, to any
Credit Party's knowledge, any predecessor of Holdings or any of its
Subsidiaries has filed any notice under any Environmental Law
indicating past or present treatment of Hazardous Materials at any
Facility, and none of Holdings' or any of its Subsidiaries' operations
involves the generation, transportation, treatment, storage or
disposal of hazardous waste, as defined under 40 C.F.R. Parts 260-270
or any state equivalent except for such filings, generation,
transportation, treatment, storage or disposal that could not
reasonably be expected to have a Material Adverse Effect. Compliance
with all current or reasonably foreseeable future requirements
pursuant to or under Environmental Laws could not be reasonably
expected to have, individually or in the aggregate, a Material Adverse
Effect. No event or condition has occurred or is occurring with
respect to Holdings or any of its Subsidiaries relating to any
Environmental Law, any Release of Hazardous
72
Materials, or any Hazardous Materials Activity which individually or
in the aggregate has had, or could reasonably be expected to have, a
Material Adverse Effect.
4.15 NO DEFAULTS. Neither Holdings nor any of its Subsidiaries is in
default in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any of its
Contractual Obligations, and no condition exists which, with the
giving of notice or the lapse of time or both, could constitute such a
default, except where the consequences, direct or indirect, of such
default or defaults, if any, could not reasonably be expected to have
a Material Adverse Effect.
4.16 GOVERNMENTAL REGULATION. Neither Holdings nor any of its Subsidiaries
is subject to regulation under the Public Utility Holding Company Act
of 1935, the Federal Power Act or the Investment Company Act of 1940
or under any other federal or state statute or regulation which may
limit its ability to incur Indebtedness or which may otherwise render
all or any portion of the Obligations unenforceable. Neither Holdings
nor any of its Subsidiaries is a "registered investment company" or is
"controlled" by a "registered investment company" or a "principal
underwriter" of a "registered investment company" as such terms are
defined in the Investment Company Act of 1940.
4.17 MARGIN STOCK. Neither Holdings nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying any Margin
Stock. No part of the proceeds of the Loans made to such Credit Party
will be used to purchase or carry any such margin stock or to extend
credit to others for the purpose of purchasing or carrying any such
margin stock or for any purpose that violates, or is inconsistent
with, the provisions of Regulation T, U or X of the Board of Governors
of the Federal Reserve System.
4.18 EMPLOYEE MATTERS. Neither Holdings nor any of its Subsidiaries is
engaged in any unfair labor practice that could reasonably be expected
to have a Material Adverse Effect. There is (a) no unfair labor
practice complaint pending against Holdings or any of its
Subsidiaries, or to the best knowledge of Holdings and Company,
threatened against any of them before the National Labor Relations
Board and no grievance or arbitration proceeding arising out of or
under any collective bargaining agreement that is so pending against
Holdings or any of its Subsidiaries or to the best knowledge of
Holdings and Company, threatened against any of them, (b) no strike or
work stoppage in existence or threatened involving Holdings or any of
its Subsidiaries that could reasonably be expected to have a Material
Adverse Effect, and (c) to the best knowledge of Holdings and Company,
no union representation question existing with respect to the
employees of Holdings or any of its Subsidiaries and, to the best
knowledge of Holdings and Company, no union organization activity that
is taking place, except (with respect to any matter specified in
clause (a), (b) or (c) above, either individually or in the aggregate)
such as is not reasonably likely to have a Material Adverse Effect.
4.19 EMPLOYEE BENEFIT PLANS. Holdings, each of its Subsidiaries and each of
their respective ERISA Affiliates are in material compliance with all
applicable provisions and requirements of ERISA and the Internal
Revenue Code and the regulations and published interpretations
thereunder with respect to each Employee Benefit Plan, and have
substantially performed all their obligations under each Employee
Benefit Plan. Each Employee Benefit Plan
73
which is intended to qualify under Section 401(a) of the Internal
Revenue Code has substantially met requirements for qualification. No
material liability to the PBGC (other than required premium payments),
the Internal Revenue Service, any Employee Benefit Plan or any Trust
established under Title IV of ERISA has been or is expected to be
incurred by Holdings, any of its Subsidiaries or any of their ERISA
Affiliates. No ERISA Event has occurred or is reasonably expected to
occur. Except to the extent required under Section 4980B of the
Internal Revenue Code or similar state laws, no Employee Benefit Plan
provides health or welfare benefits (through the purchase of insurance
or otherwise) for any retired or former employee of Holdings, any of
its Subsidiaries or any of their respective ERISA Affiliates. As of
the most recent valuation date for any Pension Plan, the amount of
~therefore benefit liabilities (as defined in Section 4001(a)(18) of
ERISA), individually or in the aggregate for all Pension Plans
(excluding for purposes of such computation any Pension Plans with
respect to which assets exceed benefit liabilities), does not exceed
$3,500,000. As of the most recent valuation date for each
Multiemployer Plan for which the actuarial report is available, the
potential liability of Holdings, its Subsidiaries and their respective
ERISA Affiliates for a complete withdrawal from such Multiemployer
Plan (within the meaning of Section 4203 of ERISA), when aggregated
with such potential liability for a complete withdrawal from all
Multiemployer Plans, based on information available pursuant to
Section 4221(e) of ERISA, does not exceed $3,500,000. Holdings, each
of its Subsidiaries and each of their ERISA Affiliates have complied
with the requirements of Section 515 of ERISA with respect to each
Multiemployer Plan and are not in material "default" (as defined in
Section 4219(c)(5) of ERISA) with respect to payments to a
Multiemployer Plan.
4.20 CERTAIN FEES. No broker's or finder's fee or commission will be
payable with respect hereto or any of the transactions contemplated
hereby, except those broker's and finder's fees otherwise disclosed to
the Agents prior to the Effective Date.
4.21 SOLVENCY. Each Credit Party is and, upon the incurrence of any
Obligation by such Credit Party on any date on which this
representation and warranty is made, will be, Solvent.
4.22 [RESERVED].
4.23 SUBORDINATION OF PERMITTED SELLER NOTES AND SENIOR SUBORDINATED NOTE
DOCUMENTS. The subordination provisions of any Permitted Seller Notes,
the Senior Subordinated Note Documents or other Subordinated
Indebtedness are enforceable against the holders thereof, and the
Loans and other Obligations thereunder are and will be within the
definition of "Subordinated Indebtedness" or "Subordinated Debt", or
similar term, as applicable, included in such provisions.
4.24 COMPLIANCE WITH STATUTES, ETC. Each of Holdings and its Subsidiaries
is in compliance with all applicable statutes, regulations and orders
of, and all applicable restrictions imposed by, all Governmental
Authorities, in respect of the conduct of its business and the
ownership of its property (including compliance with all applicable
Environmental Laws with respect to any Real Estate Asset or governing
its business and the requirements of any permits issued under such
Environmental Laws with respect to any such Real Estate Asset or the
operations of Holdings or any of its Subsidiaries), except such
non-compliance that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.
74
4.25 DISCLOSURE. No representation or warranty of any Credit Party
contained in any Credit Document or in any other documents,
certificates or written statements furnished to Lenders by or on
behalf of Holdings or any of its Subsidiaries for use in connection
with the transactions contemplated hereby contains any untrue
statement of a material fact or omits to state a material fact (known
to Holdings or Company, in the case of any document not furnished by
either of them) necessary in order to make the statements contained
herein or therein not misleading in light of the circumstances in
which the same were made. Any projections and pro forma financial
information contained in such materials are based upon good faith
estimates and assumptions believed by Holdings or Company to be
reasonable at the time made, it being recognized by Lenders that such
projections as to future events are not to be viewed as facts and that
actual results during the period or periods covered by any such
projections may differ from the projected results. There are no facts
known (or which should upon the reasonable exercise of diligence be
known) to Holdings or Company (other than matters of a general
economic nature) that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect and that
have not been disclosed herein or in such other documents,
certificates and statements furnished to Lenders for use in connection
with the transactions contemplated hereby.
SECTION 5. AFFIRMATIVE COVENANTS
Each Credit Party covenants and agrees that so long as any Commitment is in
effect and until payment in full of all Obligations, each Credit Party shall
perform, and shall cause each of its Subsidiaries to perform, all covenants in
this Section 5.
5.1 FINANCIAL STATEMENTS AND OTHER REPORTS. Holdings will deliver to
Administrative Agent and Lenders:
(a) MONTHLY REPORTS. As soon as available, and in any event within
forty-five (45) days after the end of each month ending after the
Effective Date, the consolidated balance sheet of Holdings and
its Subsidiaries as at the end of such month and the related
consolidated statements of income, stockholders' equity and cash
flows of Holdings and its Subsidiaries for such month and for the
period from the beginning of the then current Fiscal Year to the
end of such month, setting forth in each case in comparative form
(other than with respect to cash flows) the corresponding figures
for the corresponding periods of the previous Fiscal Year and the
corresponding figures from the Financial Plan for the current
Fiscal Year, to the extent prepared on a monthly basis, all in
reasonable detail, together with a Financial Officer
Certification and a Narrative Report with respect thereto;
(b) QUARTERLY FINANCIAL STATEMENTS. As soon as available, and in any
event within forty-five (45) days after the end of each of the
first three Fiscal Quarters of each Fiscal Year, the consolidated
balance sheet of Holdings and its Subsidiaries as at the end of
such Fiscal Quarter and the related consolidated statements of
income, stockholders' equity and cash flows of Holdings and its
Subsidiaries for such Fiscal Quarter and for the period from the
beginning of the then current Fiscal Year to the end of such
Fiscal Quarter, setting forth in each case in comparative form
the corresponding figures for the corresponding periods of the
previous Fiscal Year and the corresponding figures from the
Financial Plan for the current Fiscal Year, all in
75
reasonable detail, together with a Financial Officer
Certification and a Narrative Report with respect thereto;
(c) ANNUAL FINANCIAL STATEMENTS. As soon as available, and in any
event within ninety (90) days after the end of each Fiscal Year,
(i) the consolidated balance sheet of Holdings and its
Subsidiaries as at the end of such Fiscal Year and the related
consolidated statements of income, stockholders' equity and cash
flows of Holdings and its Subsidiaries for such Fiscal Year,
setting forth in each case in comparative form the corresponding
figures for the previous Fiscal Year and the corresponding
figures from the Financial Plan for the Fiscal Year covered by
such financial statements, in reasonable detail, together with a
Financial Officer Certification and a Narrative Report with
respect thereto; and (ii) with respect such consolidated
financial statements a report thereon of independent certified
public accountants of recognized national standing selected by
Holdings, and reasonably satisfactory to Administrative Agent
(which report shall be unqualified as to going concern and scope
of audit, and shall state that such consolidated financial
statements fairly present, in all material respects, the
consolidated financial position of Holdings and its Subsidiaries
as at the dates indicated and the results of their operations and
their cash flows for the periods indicated in conformity with
GAAP applied on a basis consistent with prior years (except as
otherwise disclosed in such financial statements) and that the
examination by such accountants in connection with such
consolidated financial statements has been made in accordance
with generally accepted auditing standards) together with a
written statement by such independent certified public
accountants stating whether, in connection with their audit
examination, any condition or event that constitutes a Default or
an Event of Default under Section 8 hereof has come to their
attention and, if such a condition or event has come to their
attention, specifying the nature and period of existence thereof;
provided that such accountants shall not be liable by reason of
any failure to obtain knowledge of any such Default or Event of
Default that would not be disclosed in the course of their audit
examination;
(d) COMPLIANCE CERTIFICATE. Together with each delivery of financial
statements of Holdings and its Subsidiaries pursuant to Sections
5.1(b) and 5.1(c), a duly executed and completed Compliance
Certificate;
(e) STATEMENTS OF RECONCILIATION AFTER CHANGE IN ACCOUNTING
PRINCIPLES. If, as a result of any change in accounting
principles and policies from those used in the preparation of the
Historical Financial Statements, the consolidated financial
statements of Holdings and its Subsidiaries delivered pursuant to
Section 5.1(b) or 5.1(c) will differ in any material respect from
the consolidated financial statements that would have been
delivered pursuant to such subdivisions had no such change in
accounting principles and policies been made, then, together with
the first delivery of such financial statements after such
change, one or more statements of reconciliation for all such
prior financial statements in form and substance satisfactory to
Administrative Agent;
(f) NOTICE OF DEFAULT. Promptly upon any officer of Holdings or
Company obtaining knowledge (i) of any condition or event that
constitutes a Default or an Event of Default or that notice has
been given to Holdings or Company with respect thereto; (ii) that
any Person has given any notice to Holdings or any of its
Subsidiaries or taken any other action with respect to any event
or condition set forth in Section 8.1(b); or (iii) of the
occurrence of any event or change that has caused or evidences,
either in any case or in the aggregate, a Material
76
Adverse Effect, a certificate of its Authorized Officers
specifying the nature and period of existence of such condition,
event or change, or specifying the notice given and action taken
by any such Person and the nature of such claimed Event of
Default, Default, default, event or condition, and what action
Holdings has taken, is taking and proposes to take with respect
thereto;
(g) NOTICE OF LITIGATION. Promptly upon any officer of Holdings or
Company obtaining knowledge of (i) the institution of, or
non-frivolous threat of, any Adverse Proceeding not previously
disclosed in writing by Company to Lenders, or (ii) any material
development in any Adverse Proceeding that, in the case of either
(i) or (ii) if adversely determined, could be reasonably expected
to have a Material Adverse Effect, or seeks to enjoin or
otherwise prevent the consummation of, or to recover any damages
or obtain relief as a result of, the transactions contemplated
hereby, written notice thereof together with such other
information as may be reasonably available to Holdings or Company
to enable Lenders and their counsel to evaluate such matters;
(h) ERISA. (i) Promptly upon becoming aware of the occurrence any
ERISA Event, a written notice specifying the nature thereof, what
action Holdings, any of its Subsidiaries or any of their
respective ERISA Affiliates has taken, is taking or proposes to
take with respect thereto and, when known, any action taken or
threatened by the Internal Revenue Service, the Department of
Labor or the PBGC with respect thereto; and (ii) with reasonable
promptness, copies of (1) each Schedule B (Actuarial Information)
to the annual report (Form 5500 Series) filed by Holdings, any of
its Subsidiaries or any of their respective ERISA Affiliates with
the Internal Revenue Service with respect to each Pension Plan;
(2) all notices received by Holdings, any of its Subsidiaries or
any of their respective ERISA Affiliates from a Multiemployer
Plan sponsor concerning an ERISA Event; and (3) copies of such
other documents or governmental reports or filings relating to
any Employee Benefit Plan as Administrative Agent shall
reasonably request;
(i) FINANCIAL PLAN. As soon as practicable and in any event no later
than sixty (60) days after the beginning of each Fiscal Year, a
consolidated plan and financial forecast for such Fiscal Year and
the next three succeeding Fiscal Years (a "FINANCIAL PLAN"),
including (i) a forecasted consolidated balance sheet and
forecasted consolidated statements of income and cash flows of
Holdings and its Subsidiaries for each such Fiscal Year, together
with a schedule demonstrating compliance with the financial
covenants required by Section 6.8 and an explanation of the
assumptions on which such forecasts are based and (ii) forecasted
consolidated statements of income and cash flows of Holdings and
its Subsidiaries for each month of the current Fiscal Year,
together with an explanation of the assumptions on which such
forecasts are based;
(j) INSURANCE REPORT. As soon as practicable and in any event by the
last day of each Fiscal Year, a report in form and substance
satisfactory to Administrative Agent outlining all material
insurance coverage maintained as of the date of such report by
Holdings and its Subsidiaries and all material insurance coverage
planned to be maintained by Holdings and its Subsidiaries in the
immediately succeeding Fiscal Year;
77
(k) NOTICE OF CHANGE IN BOARD OF DIRECTORS. With reasonable
promptness, written notice of any change in the board of
directors (or similar governing body) of Holdings or Company;
(l) NOTICE REGARDING MATERIAL CONTRACTS. Promptly, and in any event
within ten (10) Business Days (i) after any Material Contract of
Holdings or any of its Subsidiaries is terminated or amended in a
manner that is materially adverse to Holdings or such Subsidiary,
as the case may be, or (ii) any new Material Contract is entered
into, a written statement describing such event, with copies of
such material amendments or new contracts, delivered to
Administrative Agent (to the extent such delivery is permitted by
the terms of any such Material Contract, PROVIDED, no such
prohibition on delivery shall be effective if it were bargained
for by Holdings or its applicable Subsidiary with the intent of
avoiding compliance with this Section 5.1(l)), and an explanation
of any actions being taken with respect thereto;
(m) ENVIRONMENTAL REPORTS AND AUDITS. As soon as practicable
following receipt thereof, copies of all environmental audits and
reports with respect to environmental matters at any Facility or
which relate to any environmental liabilities of Holdings or its
Subsidiaries which, in any such case, individually or in the
aggregate, could reasonably be expected to result in a Material
Adverse Effect;
(n) INFORMATION REGARDING COLLATERAL. The Company will furnish to the
Collateral Agent prompt written notice of any change (i) in any
Credit Party's corporate name, (ii) in the location of any Credit
Party's chief executive office, its principal place of business,
any office in which it maintains books or records relating to
Collateral owned by it or any office or facility at which
Collateral (other than real property and improvements and
fixtures thereto) owned by it with a book value in excess of
$250,000 is located (including the establishment of any such new
office or facility), (iii) in any Credit Party's identity or
corporate structure or (iv) in any Credit Party's Federal
Taxpayer Identification Number. The Company agrees not to effect
or permit any change referred to in the preceding sentence unless
all filings have been made under the Uniform Commercial Code or
otherwise that are required in order for the Collateral Agent to
continue at all times following such change to have a valid,
legal and perfected security interest in all the Collateral and
for the Collateral at all times following such change to have a
valid, legal and perfected security interest as contemplated in
the Collateral Documents. The Company also agrees promptly to
notify the Collateral Agent if any material portion of the
Collateral is damaged or destroyed;
(o) ANNUAL COLLATERAL VERIFICATIONS. Each year, at the time of
delivery of annual financial statements with respect to the
preceding Fiscal Year pursuant to Section 5.1, the Company shall
deliver to the Collateral Agent an Officer's Certificate (i)
either confirming that there has been no change in such
information since the date of the UCC Questionnaire delivered on
the Effective Date or the date of the most recent certificate
delivered pursuant to this Section and/or identifying such
changes and (ii) certifying that all Uniform Commercial Code
financing statements (including fixtures filings, as applicable)
or other appropriate filings, recordings or registrations, have
been filed of record in each governmental, municipal or other
appropriate office in each jurisdiction identified pursuant to
clause (i) above to the extent necessary to protect and perfect
the security interests under the Collateral Documents for a
period of not less
78
than 18 months after the date of such certificate (except as
noted therein with respect to any continuation statements to be
filed within such period); and
(p) OTHER INFORMATION. (A) Promptly upon their becoming available,
copies of (i) all financial statements, reports, notices and
proxy statements sent or made available generally by Holdings to
its security holders acting in such capacity or by any Subsidiary
of Holdings to its security holders other than Holdings or
another Subsidiary of Holdings, (ii) all regular and periodic
reports and all registration statements and prospectuses, if any,
filed by Holdings or any of its Subsidiaries with any securities
exchange or with the Securities and Exchange Commission or any
governmental or private regulatory authority, (iii) all press
releases and other statements made available generally by
Holdings or any of its Subsidiaries to the public concerning
material developments in the business of Holdings or any of its
Subsidiaries, and (B) such other information and data with
respect to Holdings or any of its Subsidiaries as from time to
time may be reasonably requested by Administrative Agent or any
Lender.
5.2 EXISTENCE. Except as otherwise permitted under Section 6.9, each
Credit Party will, and will cause each of its Subsidiaries to, at
all times preserve and keep in full force and effect its
existence and all rights and franchises, licenses and permits
material to its business; PROVIDED, no Credit Party or any of its
Subsidiaries shall be required to preserve any such existence,
right or franchise, licenses and permits if such Person's board
of directors (or similar governing body) shall determine that the
preservation thereof is no longer desirable in the conduct of the
business of such Person, and that the loss thereof is not
disadvantageous in any material respect to such Person or to
Lenders.
5.3 PAYMENT OF TAXES AND CLAIMS. Each Credit Party will, and will
cause each of its Subsidiaries to, pay all Taxes imposed upon it
or any of its properties or assets or in respect of any of its
income, businesses or franchises before any penalty or fine
accrues thereon, and all claims (including claims for labor,
services, materials and supplies) for sums that have become due
and payable and that by law have or may become a Lien upon any of
its properties or assets, prior to the time when any penalty or
fine shall be incurred with respect thereto; PROVIDED, no such
Tax or claim need be paid if it is being contested in good faith
by appropriate proceedings promptly instituted and diligently
conducted, so long as (a) an adequate reserve or other
appropriate provision, as shall be required in conformity with
GAAP shall have been made ~therefore, and (b) in the case of a
charge or claim which has or may become a Lien against any of the
Collateral, such contest proceedings conclusively operate to stay
the sale of any portion of the Collateral to satisfy such Tax or
claim. No Credit Party will, nor will it permit any of its
Subsidiaries to, file or consent to the filing of any
consolidated income Tax return with any Person (other than
Holdings or any of its Subsidiaries).
5.4 MAINTENANCE OF PROPERTIES. Each Credit Party will, and will cause
each of its Subsidiaries to, maintain or cause to be maintained
in good repair, working order and condition, ordinary wear and
tear excepted, all material properties used or useful in the
business of Holdings and its Subsidiaries and from time to time
will make or cause to be made all appropriate repairs, renewals
and replacements thereof, and each Credit Party shall defend any
Collateral against all Persons at any time claiming any interest
therein.
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5.5 INSURANCE. Holdings will maintain or cause to be maintained, with
financially sound and reputable insurers, such public liability
insurance, third party property damage insurance, business
interruption insurance and casualty insurance with respect to
liabilities, losses or damage in respect of the assets,
properties and businesses of Holdings and its Subsidiaries as may
customarily be carried or maintained under similar circumstances
by Persons of established reputation engaged in similar
businesses, in each case in such amounts (giving effect to
self-insurance), with such deductibles, covering such risks and
otherwise on such terms and conditions as shall be customary for
such Persons. Without limiting the generality of the foregoing,
Holdings will maintain or cause to be maintained (a) flood
insurance with respect to each Flood Hazard Property that is
located in a community that participates in the National Flood
Insurance Program, in each case in compliance with any applicable
regulations of the Board of Governors of the Federal Reserve
System, and (b) replacement value casualty insurance on the
Collateral under such policies of insurance, with such insurance
companies, in such amounts, with such deductibles, and covering
such risks as are at all times carried or maintained under
similar circumstances by Persons of established reputation
engaged in similar businesses. Each such policy of insurance
shall (i) name Administrative Agent, on behalf of Lenders as an
additional insured thereunder as its interests may appear and
(ii) in the case of each casualty insurance policy, contain a
loss payable clause or endorsement, satisfactory in form and
substance to Administrative Agent, that names Administrative
Agent, on behalf of Lenders as the loss payee thereunder.
5.6 INSPECTIONS. Each Credit Party will, and will cause each of its
Subsidiaries to, permit any authorized representatives designated
by any Lender to visit and inspect any of the properties of any
Credit Party and any of its respective Subsidiaries, to inspect,
copy and take extracts from its and their financial and
accounting records, and to discuss its and their affairs,
finances and accounts with its and their officers and independent
public accountants, all upon reasonable notice and at such
reasonable times during normal business hours and as often as may
reasonably be requested; PROVIDED, that each Lender shall
coordinate with Administrative Agent with respect to the
frequency and timing of such visits and inspections so as to
reasonably minimize the burden imposed on each Credit Party and
its Subsidiaries.
5.7 LENDERS MEETINGS. Holdings and Company will, upon the request of
Administrative Agent or Requisite Lenders, participate in a
meeting of Administrative Agent and Lenders once during each
Fiscal Year to be held at Company's corporate offices (or at such
other location as may be agreed to by Company and Administrative
Agent) at such time as may be agreed to by Company and
Administrative Agent.
5.8 COMPLIANCE WITH LAWS. Each Credit Party will comply, and shall
cause each of its Subsidiaries and all other Persons, if any, on
or occupying any Facilities to comply, with the requirements of
all applicable laws, rules, regulations and orders of any
governmental authority (including all Environmental Laws),
noncompliance with which could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.
5.9 ENVIRONMENTAL.
(a) ENVIRONMENTAL DISCLOSURE. Holdings will deliver to
Administrative Agent and Lenders:
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(i) as soon as practicable following receipt thereof,
copies of all environmental audits, investigations,
analyses and reports of any kind or character, whether
prepared by personnel of Holdings or any of its
Subsidiaries or by independent consultants,
governmental authorities or any other Persons, with
respect to significant environmental matters at any
Facility or with respect to any known Environmental
Claims;
(ii) promptly upon the occurrence thereof, written notice
describing in reasonable detail (1) any Release
required to be reported to any federal, state or local
governmental or regulatory agency under any applicable
Environmental Laws, (2) any remedial action taken by
Holdings or any other Person in response to (A) any
Hazardous Materials Activities the existence of which
has a reasonable possibility of resulting in one or
more Environmental Claims having, individually or in
the aggregate, a Material Adverse Effect, or (B) any
Environmental Claims that, individually or in the
aggregate, have a reasonable possibility of resulting
in a Material Adverse Effect, and (3) Holdings or
Company's discovery of any occurrence or condition on
any real property adjoining or in the vicinity of any
Facility that could cause such Facility or any part
thereof to be subject to any material restrictions on
the ownership, occupancy, transferability or use
thereof under any Environmental Laws;
(iii) as soon as practicable following the sending or
receipt thereof by Holdings or any of its Subsidiaries,
a copy of any and all material written communications
with respect to (1) any Environmental Claims that,
individually or in the aggregate, have a reasonable
possibility of giving rise to a Material Adverse
Effect, (2) any Release required to be reported to any
federal, state or local governmental or regulatory
agency, and (3) any request for information from any
governmental agency that suggests such agency is
investigating whether Holdings or any of its
Subsidiaries may be potentially responsible for any
Hazardous Materials Activity that has a reasonable
possibility of giving rise to a Material Adverse
Effect;
(iv) prompt written notice describing in reasonable detail
(1) any proposed acquisition of stock, assets, or
property by Holdings or any of its Subsidiaries that
could reasonably be expected to (A) expose Holdings or
any of its Subsidiaries to, or result in, Environmental
Claims that could reasonably be expected to have,
individually or in the aggregate, a Material Adverse
Effect or (B) affect the ability of Holdings or any of
its Subsidiaries to maintain in full force and effect
all material Governmental Authorizations required under
any Environmental Laws for their respective operations
and (2) any proposed action to be taken by Holdings or
any of its Subsidiaries to modify current operations in
a manner that could reasonably be expected to subject
Holdings or any of its Subsidiaries to any additional
material obligations or requirements under any
Environmental Laws; and
(v) with reasonable promptness, such other documents and
information as from time to time may be reasonably
requested by Administrative Agent in relation to any
matters disclosed pursuant to this Section 5.9(a).
(b) HAZARDOUS MATERIALS ACTIVITIES, ETC. Each Credit Party shall
promptly take, and shall cause each of its Subsidiaries
promptly to take, any and all actions necessary to (i) cure
any violation of applicable Environmental Laws by such
Credit Party or its Subsidiaries that could reasonably be
expected to have, individually or in the aggregate, a
Material Adverse Effect, and (ii) make an appropriate
response to any known Environmental Claim against such
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Credit Party or any of its Subsidiaries where failure to do
so could reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect; PROVIDED, HOWEVER,
that nothing in this Section 5.9(b) shall preclude any
Credit Party or any of its Subsidiaries from contesting in
good faith any such Environmental Claim.
5.10 SUBSIDIARIES. In the event that any Person becomes a Domestic
Subsidiary of Company, Company shall, except with respect to Permitted
Partially-Owned Subsidiaries, (a) promptly cause such Domestic
Subsidiary to become a Guarantor hereunder and a Grantor under the
Pledge and Security Agreement by executing and delivering to
Administrative Agent and Collateral Agent a Counterpart Agreement, and
(b) take all such actions and execute and deliver, or cause to be
executed and delivered, all such Mortgage Documents, Environmental
Reports and all such documents, instruments, agreements, and
certificates as are similar to those described in Sections 3.1(b) and
3.1(e), and to the extent reasonably requested by Administrative
Agent, such documents, instruments, agreements, and certificates as
are similar to those described in Section 3.1(g). In the event that
any Person becomes a Foreign Subsidiary of Company, and the ownership
interests of such Foreign Subsidiary are owned by Company or by any
Domestic Subsidiary thereof, Company shall, or shall cause such
Domestic Subsidiary to, deliver, all such documents, instruments,
agreements, and certificates as are similar to those described in
Sections 3.1(b), and Company shall take, or shall cause such Domestic
Subsidiary to take, all of the actions referred to in Section
3.1(e)(i) necessary to grant and to perfect a First Priority Lien in
favor of Administrative Agent, for the benefit of Secured Parties,
under the Pledge and Security Agreement in not more than 65% of such
ownership interests. With respect to each such Subsidiary, Company
shall promptly send to Administrative Agent written notice setting
forth with respect to such Person (i) the date on which such Person
became a Subsidiary of Company, and (ii) all of the data required to
be set forth in Schedules 4.1 and 4.2 with respect to all Subsidiaries
of Company; PROVIDED, such written notice shall be deemed to
supplement Schedule 4.1 and 4.2 for all purposes hereof.
5.11 ADDITIONAL MATERIAL REAL ESTATE ASSETS. In the event that any Credit
Party acquires a Material Real Estate Asset or a Real Estate Asset
owned on the Effective Date becomes a Material Real Estate Asset and
such interest has not otherwise been made subject to the Lien of the
Collateral Documents in favor of Collateral Agent, for the benefit of
Secured Parties, then such Credit Party, contemporaneously with
acquiring such Material Real Estate Asset, shall take all such actions
and execute and deliver, or cause to be executed and delivered, all
such Mortgage Documents, Environmental Reports and all such documents,
instruments, agreements, opinions and certificates similar to those
described in Section 3.1(e) with respect to each such Material Real
Estate Asset that Collateral Agent shall reasonably request to create
in favor of Collateral Agent, for the benefit of Secured Parties, a
valid and, subject to any filing and/or recording referred to herein,
perfected First Priority security interest in such Material Real
Estate Assets. In addition to the foregoing, Company shall, at the
request of Requisite Lenders, deliver, from time to time, to
Collateral Agent such appraisals as are required by law or regulation
of Real Estate Assets with respect to which Collateral Agent has been
granted a Lien.
5.12 [RESERVED].
5.13 FURTHER ASSURANCES. At any time or from time to time upon the request
of Administrative Agent, each Credit Party will, at its expense,
promptly execute, acknowledge and
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deliver such further documents and do such other acts and things as
Administrative Agent or Collateral Agent may reasonably request in
order to effect fully the purposes of the Credit Documents. In
furtherance and not in limitation of the foregoing, each Credit Party
shall take such actions as Administrative Agent or Collateral Agent
may reasonably request from time to time to ensure that the
Obligations are guarantied by the Guarantors and are secured by
substantially all of the assets of Holdings, and its Subsidiaries and
all of the outstanding Capital Stock of Company and its Subsidiaries
(subject to limitations contained in the Credit Documents with respect
to Foreign Subsidiaries).
SECTION 6. NEGATIVE COVENANTS
Each Credit Party covenants and agrees that, so long as any Commitment is
in effect and until payment in full of all Obligations, such Credit Party shall
perform, and shall cause each of its Subsidiaries to perform, all covenants in
this Section 6.
6.1 INDEBTEDNESS. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume or
guaranty, or otherwise become or remain directly or indirectly liable
with respect to any Indebtedness, except:
(a) the Obligations;
(b) Indebtedness of any Guarantor Subsidiary to Company or to any
other Guarantor Subsidiary, or of Company to any Guarantor
Subsidiary; PROVIDED, (i) all such Indebtedness shall be
evidenced by promissory notes and all such notes shall be subject
to a First Priority Lien pursuant to the Pledge and Security
Agreement, (ii) all such Indebtedness shall be unsecured and
subordinated in right of payment to the payment in full of the
Obligations pursuant to the terms of the applicable promissory
notes or an intercompany subordination agreement that in any such
case, is reasonably satisfactory to Administrative Agent, and
(iii) any payment by any such Guarantor Subsidiary under any
guaranty of the Obligations shall result in a pro tanto reduction
of the amount of any Indebtedness owed by such Subsidiary to
Company or to any of its Subsidiaries for whose benefit such
payment is made;
(c) (i) Indebtedness incurred by Company with respect to the New
Company Subordinated Notes and (ii) other Indebtedness incurred
to refinance, in whole or in part, Indebtedness under the New
Company Subordinated Notes if the terms and conditions thereof
are not less favorable, taken as a whole, to the obligor thereon
or to the Lenders than the Indebtedness being refinanced and the
average life to maturity thereof is greater than or equal to that
of the Indebtedness being refinanced; PROVIDED, such Indebtedness
permitted under the immediately preceding clause (ii) above shall
(A) not include Indebtedness of an obligor that was not an
obligor with respect to the Indebtedness being refinanced, (B)
not exceed in principal amount (or accreted value, in the case of
any such refinancing Indebtedness issued with a discount) of the
Indebtedness (including the amount of interest and principal (and
premium, if any)) being refinanced PLUS the amount of customary
underwriting discounts, financing fees and commissions and other
reasonable costs and expenses associated with the issuance
thereof, (C) be subordinated to the Obligations on terms which
are not less favorable, taken as a whole, to the Lenders than the
corresponding terms of the Indebtedness being refinanced and (D)
not be
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incurred, created or assumed if any Default or Event of Default
has occurred and is continuing or would result therefrom;
(d) Indebtedness incurred by Holdings pursuant to Section 6.5(a);
PROVIDED, that such Indebtedness shall be unsecured and
subordinated in right of payment to the payment in full of the
Obligations pursuant to the terms of the applicable promissory
notes or an intercompany subordination agreements that in any
such case, is reasonably satisfactory to Administrative Agent;
(e) Indebtedness incurred by Holdings or any of its Subsidiaries
arising from agreements providing for indemnification, adjustment
of purchase price or similar obligations, or from guaranties or
letters of credit, surety bonds or performance bonds securing the
performance of the Company or any such Subsidiary pursuant to
such agreements, in connection with Permitted Acquisitions or
permitted dispositions of any business, assets or Subsidiary of
Holdings or any of its Subsidiaries;
(f) Indebtedness which may be deemed to exist pursuant to any
guaranties, performance, surety, statutory, appeal or similar
obligations incurred in the ordinary course of business;
(g) Indebtedness in respect of netting services, overdraft
protections and otherwise in connection with deposit accounts;
(h) guaranties in the ordinary course of business of the obligations
of suppliers, customers, franchisees and licensees of Holdings
and its Subsidiaries;
(i) guaranties by Company of Indebtedness of a Guarantor Subsidiary
or guaranties by a Subsidiary of Company of Indebtedness of
Company or a Guarantor Subsidiary with respect, in each case, to
Indebtedness otherwise permitted to be incurred pursuant to this
Section 6.1;
(j) Indebtedness described in Schedule 6.1, but not any extensions,
renewals or replacements of such Indebtedness except (i) renewals
and extensions expressly provided for in the agreements
evidencing any such Indebtedness as the same are in effect on the
date of this Agreement and (ii) refinancings and extensions of
any such Indebtedness if the terms and conditions thereof are not
less favorable to the obligor thereon or to the Lenders than the
Indebtedness being refinanced or extended, and the average life
to maturity thereof is greater than or equal to that of the
Indebtedness being refinanced or extended; PROVIDED, such
Indebtedness permitted under the immediately preceding clause (i)
or (ii) above shall not (A) include Indebtedness of an obligor
that was not an obligor with respect to the Indebtedness being
extended, renewed or refinanced, (B) exceed in a principal amount
the Indebtedness being renewed, extended or refinanced or (C)
incurred, created or assumed if any Default or Event of Default
has occurred and is continuing or would result therefrom;
(k) Indebtedness with respect to Capital Leases in an aggregate
amount not to exceed at any time $3,500,000;
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(l) purchase money Indebtedness in an aggregate amount not to exceed
at any time $3,500,000 (including any Indebtedness acquired in
connection with a Permitted Acquisition); PROVIDED, any such
Indebtedness (i) shall be secured only to the asset acquired in
connection with the incurrence of such Indebtedness, and (ii)
shall constitute not less than 75% of the aggregate consideration
paid with respect to such asset;
(m) Permitted Seller Notes (i) issued by Holdings as consideration in
Permitted Acquisitions; PROVIDED, that the aggregate principal
amount of such Permitted Seller Notes issued by Holdings shall
not exceed $17,500,000; and (ii) issued by Company as
consideration in Permitted Acquisitions; PROVIDED, that the
aggregate principal amount of such Permitted Seller Notes issued
by Company shall not exceed $7,500,000;
(n) Earn-Out Obligations incurred by Holdings constituting
consideration payable in connection with Permitted Acquisitions;
PROVIDED, that the maximum aggregate exposure, as reasonably
estimated by management under all such Earn-Out Obligations shall
not exceed $6,000,000 at any time outstanding;
(o) A Subsidiary acquired pursuant to a Permitted Acquisition may
become or remain liable with respect to Indebtedness of such
Subsidiary existing at the time of the acquisition of such
Subsidiary by Company or any of its Subsidiaries and, a
Subsidiary may become liable with respect to Indebtedness secured
by assets acquired pursuant to a Permitted Acquisition; provided
that (i) such Indebtedness was not incurred in connection with,
or in anticipation of, such Permitted Acquisition, and (ii) the
aggregate principal amount of all such Indebtedness does not
exceed $10,000,000;
(p) Indebtedness of Company or any of its Subsidiaries to a Person to
the extent incurred in connection with a Permitted Acquisition of
a portion or all of the Capital Stock of a Permitted
Partially-Owned Subsidiary and any guaranty of such Indebtedness
by Holdings, in an aggregate principal amount not to exceed at
any time outstanding $2,500,000;
(q) Holdings and its Subsidiaries may incur the post-Closing Date
obligations to pay Transaction Costs;
(r) Indebtedness of Holdings constituting Investments by Company
permitted under Section 6.7 hereof;
(s) other unsecured Indebtedness of Holdings and its Subsidiaries
(other than with respect to Permitted Seller Notes), in an
aggregate amount not to exceed at any time $20,000,000;
(t) the guaranty by Holdings of Indebtedness of Company pursuant to
the New Company Subordinated Notes; PROVIDED, that such guaranty
is unsecured and subordinated to the Obligations; and
(u) Indebtedness of Holdings or Company comprised of Take Out
Securities.
6.2 LIENS. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume or
permit to exist any Lien on or with respect to any property
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or asset of any kind (including any document or instrument in respect
of goods or accounts receivable) of Holdings or any of its
Subsidiaries, whether now owned or hereafter acquired, or any income
or profits therefrom, or file or permit the filing of, or permit to
remain in effect, any financing statement or other similar notice of
any Lien with respect to any such property, asset, income or profits
under the UCC of any State or under any similar recording or notice
statute, except:
(a) Liens in favor of Collateral Agent for the benefit of Secured
Parties granted pursuant to any Credit Document;
(b) Liens for Taxes if obligations with respect to such Taxes are
being contested in good faith by appropriate proceedings promptly
instituted and diligently conducted;
(c) statutory Liens of landlords, banks (and rights of set-off), of
carriers, warehousemen, mechanics, repairmen, workmen and
materialmen, and other Liens imposed by law (other than any such
Lien imposed pursuant to Section 401 (a)(29) or 412(n) of the
Internal Revenue Code or by ERISA), in each case incurred in the
ordinary course of business (i) for amounts not yet overdue or
(ii) for amounts that are overdue and that (in the case of any
such amounts overdue for a period in excess of five days) are
being contested in good faith by appropriate proceedings, so long
as such reserves or other appropriate provisions, if any, as
shall be required by GAAP shall have been made for any such
contested amounts;
(d) Liens incurred in the ordinary course of business in connection
with workers' compensation, unemployment insurance and other
types of social security, or to secure the performance of
tenders, statutory obligations, surety and appeal bonds, bids,
leases, government contracts, trade contracts, performance and
return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money or other
Indebtedness), so long as no foreclosure, sale or similar
proceedings have been commenced with respect to any portion of
the Collateral on account thereof;
(e) easements, rights-of-way, restrictions, encroachments, and other
minor defects or irregularities in title, in each case which do
not and will not interfere in any material respect with the
ordinary conduct of the business of Holdings or any of its
Subsidiaries;
(f) any interest or title of a lessor or sublessor under any lease of
real estate permitted hereunder;
(g) Liens solely on any cash earnest money deposits made by Holdings
or any of its Subsidiaries in connection with any letter of
intent or purchase agreement entered into by it as permitted
hereunder;
(h) purported Liens evidenced by the filing of precautionary UCC
financing statements relating solely to operating leases of
personal property entered into in the ordinary course of
business;
(i) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection
with the importation of goods;
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(j) any zoning or similar law or right reserved to or vested in any
governmental office or agency to control or regulate the use of
any real property;
(k) licenses of patents, trademarks and other intellectual property
rights granted by Holdings or any of its Subsidiaries in the
ordinary course of business and not interfering in any respect
with the ordinary conduct of the business of Company or such
Subsidiary;
(l) Liens described in Schedule 6.2 or on a title report delivered in
connection with clause (iv) of the definition of "Mortgage
Documents";
(m) Liens securing Indebtedness permitted pursuant to Section 6.1(k)
and 6.1(l); provided, any such Lien shall encumber only the asset
acquired with the proceeds of such Indebtedness;
(n) Liens on assets acquired pursuant to a Permitted Acquisition
securing Indebtedness permitted under Section 6.1(o) so long as
such Liens were not created in anticipation of such Permitted
Acquisition; and
(o) Liens on assets acquired pursuant to a Permitted Acquisition, so
long as the fair market value of any assets subject to such Liens
at any time does not exceed in the aggregate $2,000,000.
6.3 EQUITABLE LIEN. If any Credit Party or any of its Subsidiaries shall
create or assume any Lien upon any of its properties or assets,
whether now owned or hereafter acquired, other than Permitted Liens,
it shall make or cause to be made effective a provisions whereby the
Obligations will be secured by such Lien equally and ratably with any
and all other Indebtedness secured thereby as long as any such
Indebtedness shall be so secured; PROVIDED, notwithstanding the
foregoing, this covenant shall not be construed as a consent by
Requisite Lenders to the creation or assumption of any such Lien not
otherwise permitted hereby.
6.4 NO FURTHER NEGATIVE PLEDGES. Except with respect to (a) specific
property encumbered to secure payment of particular Indebtedness or to
be sold pursuant to an executed agreement with respect to a permitted
Asset Sale and (b) restrictions by reason of customary provisions
restricting assignments, subletting or other transfers contained in
leases, licenses and similar agreements entered into in the ordinary
course of business (PROVIDED that such restrictions are limited to the
property or assets secured by such Liens or the property or assets
subject to such leases, licenses or similar agreements, as the case
may be) no Credit Party nor any of its Subsidiaries shall enter into
any agreement prohibiting the creation or assumption of any Lien upon
any of its properties or assets, whether now owned or hereafter
acquired.
6.5 RESTRICTED JUNIOR PAYMENTS. No Credit Party shall, nor shall it permit
any of its Subsidiaries to, directly or indirectly, declare, order,
pay, make or set apart any sum for any Restricted Junior Payment
except the following shall be permitted:
(a) [Reserved];
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(b) Company may make regularly scheduled payments (but not voluntary
prepayments) in respect of (i) the New Company Subordinated Notes
in accordance with the terms of, and only to the extent required
by, and subject to the subordination provisions contained in, the
New Company Subordinated Note Indenture and (ii) any repurchase
or repayment of the New Company Subordinated Notes with the
proceeds of any refinancing of the New Company Subordinated Notes
permitted under Section 6.1(c);
(c) So long as no Default or Event of Default shall have occurred and
be continuing or shall be caused thereby, Company may make
regularly scheduled payments of interest on any Take Out
Securities; PROVIDED that (i) the aggregate amount of any such
interest payments shall not exceed $10,000,000 in any Fiscal Year
and (ii) at the time of such Restricted Junior Payment, and after
giving effect thereto, the Senior Leverage Ratio shall not exceed
2.25:1.00;
(d) So long as no Default or Event of Default shall have occurred and
be continuing or shall be caused thereby, Company may consummate
a Tender Offer or redeem the New Company Subordinated Notes in
accordance with the terms of the New Company Subordinated Note
Indenture; provided that at the time of such Restricted Junior
Payment, and after giving effect thereto, the Senior Leverage
Ratio shall not exceed 2.25:1.00;
(e) Subsidiaries of Company may make Restricted Junior Payments by
way of dividends to its shareholders proportionate to their
respective holdings;
(f) Holdings may make regularly scheduled payments in respect of (i)
Permitted Seller Notes in accordance with the terms of, and only
to the extent required by, and subject to the subordination
provisions contained in, the agreement pursuant to which such
Permitted Seller Notes were issued or were otherwise subject, and
(ii) Earn-Out Obligations in accordance with the terms of, and
only to the extent required by, and subject to the subordination
provisions contained in, the documents related to the relevant
Permitted Acquisition;
(g) Company and any of its Subsidiaries may issue Indebtedness
pursuant to Section 6.1(p) and may make regularly scheduled
payments in respect of such Indebtedness and Company and its
Subsidiaries may make Restricted Junior Payments to make a
Permitted Acquisition of a portion or all of the Capital Stock of
a Permitted Partially-Owned Subsidiary; provided that (i) the
aggregate amount of such Restricted Junior Payments do not exceed
$750,000 in any Fiscal Year, and (ii) the aggregate principal
amount of any such Indebtedness outstanding pursuant to Section
6.1(p) does not exceed at any time $2,500,000 in the aggregate;
(h) Company may make Restricted Junior Payments to Holdings to the
extent required to enable Holdings (i) to make scheduled payments
of principal and interest on the Permitted Seller Notes and (ii)
to make payments on Earn-Out Obligations in accordance with the
terms of, and only to the extent required by, the documents
related to the relevant Permitted Acquisition, so long as
Holdings applies the amount of any such Restricted Junior Payment
for such purpose; PROVIDED, that at the time of such Restricted
Junior Payment pursuant to this clause (h) and immediately after
giving effect thereto, no Event of Default shall have occurred
and be continuing under Section 8.1(a), Section 8.1(c) or Section
8.1(e);
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(i) Holdings and/or Company and its Subsidiaries may pay Transaction
Costs (and Company may make Restricted Junior Payments to
Holdings to the extent required to enable Holdings to make such
payments, so long as Holdings applies the amount of any such
Restricted Junior Payment for such purpose); provided that at the
time of such Restricted Junior Payment pursuant to this clause
(i) and immediately after giving effect thereto, no Event of
Default shall have occurred and be continuing under Sections
8.1(a), Section 8.1(c) or Section 8.1(e);
(j) Holdings may repurchase shares of Capital Stock of Holdings held
by officers and employees of Holdings and its Subsidiaries upon
the termination of the employment of such officers and employees;
PROVIDED, HOWEVER, that the amount of such repurchase shall not
exceed in any Fiscal Year the sum of (1) $1,500,000 PLUS (2) the
unutilized portion of such $1,500,000 from the immediately
preceding Fiscal Year;
(k) Company may make Restricted Junior Payments to Holdings to the
extent required to enable Holdings to make the repurchases
permitted pursuant to Section 6.5(j), so long as Holdings applies
the amount of any such Restricted Junior Payment for such
purpose;
(l) so long as no Default or Event of Default shall have occurred and
be continuing or shall be caused thereby, Holdings and/or Company
may make payments to Leonard Green & Partners, L.P. (and Company
may make Restricted Junior Payments to Holdings to the extent
required to enable Holdings to make such payments, so long as
Holdings applies the amount of any such Restricted Junior
Payments for such purpose) in an amount not to exceed in any
Fiscal Year, the sum of the following: (1) $2,550,000 PLUS 1.6%
of any additional equity investment made after the Closing Date
by Sponsor, Co-Investors and their Affiliates as annual
management fees pursuant to the Management Services Agreement,
(2) any transaction fees to be paid to Leonard Green & Partners,
L.P. in connection with the Prior Acquisition, (3) any normal and
customary transaction fees to be paid to Leonard Green &
Partners, L.P., from time to time, under such Management Services
Agreement, and (4) the reimbursement of the normal and customary
out-of-pocket costs and expenses of Leonard Green & Partners,
L.P. under such Management Services Agreement; PROVIDED, HOWEVER,
such payments shall accrue during the pendency of any such
Default or Event of Default and to the extent accrued shall be
payable upon the cure, waiver or rescission of such Default or
Event of Default; provided, FURTHER, that the amount of such
accrued payments in the Fiscal Year in which such accrued
payments are actually made shall be in addition to the aggregate
amount otherwise permitted to be paid in such Fiscal Year as set
forth in clauses (1), (2), (3) and (4) of this Section 6.5(l);
(m) so long as no Default or Event of Default shall have occurred and
be continuing or shall be caused thereby, Company may make
Restricted Junior Payments to Holdings, to the extent necessary
to permit Holdings to pay reasonable general administrative costs
and expenses and (ii) to the extent necessary to permit Holdings
to discharge the consolidated tax liabilities of Holdings and its
Subsidiaries, in each case so long as Holdings applies the amount
of any such Restricted Junior Payment for such purpose;
(n) notwithstanding Section 6.5(b) or any of the foregoing to the
contrary, so long as no Default or Event or Default shall have
occurred and be continuing or shall be covered
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thereby, Company may make voluntary prepayments in respect of the
New Company Subordinated Notes in an aggregate amount not to
exceed $50,000,000; and
(o) Company or any of its Subsidiaries may purchase any additional
portion, or all, of the Capital Stock of any Permitted
Partially-Owned Subsidiary in accordance with Section 6.9(h).
6.6 RESTRICTIONS ON SUBSIDIARY DISTRIBUTIONS. Except as provided herein,
no Credit Party shall, nor shall it permit any of its Subsidiaries to,
create or otherwise cause or suffer to exist or become effective any
consensual encumbrance or restriction of any kind on the ability of
any Subsidiary of Company to (a) pay dividends or make any other
distributions on any of such Subsidiary's Capital Stock owned by
Company or any other Subsidiary of Company, (b) repay or prepay any
Indebtedness owed by such Subsidiary to Company or any other
Subsidiary of Company, (c) make loans or advances to Company or any
other Subsidiary of Company, or (d) transfer any of its property or
assets to Company or any other Subsidiary of Company other than
restrictions (i) in agreements evidencing Indebtedness permitted by
Section 6.1(k), Section 6.1(l) and Section 6.1(o) that impose
restrictions on the transfer of property so acquired or securing such
Indebtedness and (ii) by reason of customary provisions restricting
assignments, subletting or other transfers contained in leases,
licenses, joint venture agreements and similar agreements entered into
in the ordinary course of business, and (iii) that are or were created
by virtue of any transfer of, agreement to transfer or option or right
with respect to any property, assets or Capital Stock not otherwise
prohibited under this Agreement.
6.7 INVESTMENTS. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, make or own any Investment in
any Person, including without limitation any Joint Venture, except:
(a) [Reserved];
(b) Cash Equivalents;
(c) equity Investments owned as of the Closing Date in any Subsidiary
and Investments made after the Closing Date in any Subsidiary of
Company;
(d) Investments (i) in accounts receivable arising and trade credit
granted in the ordinary course of business and in any Securities
received in satisfaction or partial satisfaction thereof from
financially troubled account debtors and (ii) deposits,
prepayments and other credits to suppliers made in the ordinary
course of business consistent with the past practices of Holdings
and its Subsidiaries;
(e) intercompany loans to the extent permitted under Section 6.1(b);
(f) Consolidated Capital Expenditures permitted by Section 6.8(e);
(g) loans and advances to employees of Holdings and its Subsidiaries
made in the ordinary course of business, including to purchase
Capital Stock of Holdings, in an aggregate principal amount not
to exceed $2,000,000 at any one time outstanding; PROVIDED,
HOWEVER, that the amount allocable to loans and advances to
purchase Capital Stock of Holdings shall not
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exceed $1,000,000 in the aggregate; PROVIDED, FURTHER, HOWEVER,
that the proceeds received by Holdings of such purchase of
Holdings' Capital Stock, shall be used by Holdings to acquire
Capital Stock of Company or otherwise used to make a common
equity contribution to Company or to repay loans or advances made
to Holdings by Company pursuant to Section 6.7(i);
(h) the payment of Transaction Costs;
(i) loans and advances from Company to Holdings to permit Holdings to
make payments contemplated to be made pursuant to Section 6.5
hereof;
(j) Investments made to purchase the Capital Stock of any Subsidiary
of Company from a Person who is not an Affiliate of Company and
loans and advances to Persons permitted pursuant to Section
6.9(g) to purchase Capital Stock of any Subsidiary of Company in
order to allow such purchases;
(k) Investments made in connection with Permitted Acquisitions
permitted pursuant to Section 6.9;
(l) Investments described in Schedule 6.7; and
(m) other Investments in an aggregate amount not to exceed at any
time $10,000,000.
6.8 FINANCIAL COVENANTS.
(a) INTEREST COVERAGE RATIO. Company shall not permit the Interest
Coverage Ratio as of the last day of any Fiscal Quarter,
beginning with the Fiscal Quarter ending June 30, 2004 to be less
than the correlative ratio indicated:
FISCAL QUARTER INTEREST COVERAGE RATIO
June 30, 2004 2.75:1.00
September 30, 2004 2.75:1.00
December 31, 2004 3.00:1.00
and thereafter
(b) FIXED CHARGE COVERAGE RATIO. Company shall not permit the Fixed
Charge Coverage Ratio as of the last day of any Fiscal Quarter,
beginning with the Fiscal Quarter ending June 30, 2004, to be
less than the correlative ratio indicated:
FISCAL QUARTER FIXED CHARGE COVERAGE
RATIO
June 30, 2004 and 1.10:1.00
thereafter
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(c) LEVERAGE RATIO. Company shall not permit the Leverage Ratio as of
the last day of any Fiscal Quarter, beginning with the Fiscal
Quarter ending June 30, 2004, to exceed the correlative ratio
indicated:
FISCAL QUARTER LEVERAGE RATIO
June 30, 2004 3.50:1.00
September 30, 2004 3.50:1.00
December 31, 2004 3.50:1.00
March 31, 2005 3.50:1.00
June 30, 2005 3.50:1.00
September 30, 2005 3.50:1.00
December 31, 2005 3.25:1.00
March 31, 2006 3.25:1.00
June 30, 2006 3.25:1.00
September 30, 2006 3.25:1.00
December 31, 2006 2.75:1.00
March 31, 2007 2.50:1.00
June 30, 2007 2.50:1.00
September 30, 2007 and 2.25:1.00
thereafter
(d) SENIOR LEVERAGE RATIO. Company shall not permit the Senior
Leverage Ratio as of the last day of any Fiscal Quarter,
beginning with the Fiscal Quarter ending June 30, 2004, to exceed
the correlative ratio indicated:
FISCAL QUARTER SENIOR LEVERAGE RATIO
June 30, 2004 2.25:1.00
September 30, 2004 2.25:1.00
December 31, 2004 2.25:1.00
March 31, 2005 2.25:1.00
June 30, 2005 2.25:1.00
September 30, 2005 2.25:1.00
December 31, 2005 2.00:1.00
March 31, 2006 2.00:1.00
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June 30, 2006 2.00:1.00
September 30, 2006 1.75:1.00
December 31, 2006 1.75:1.00
March 31, 2007 1.50:1.00
June 30, 2007 1.50:1.00
September 30, 2007 1.50:1.00
December 31, 2007 and 1.00:1.00
thereafter
(e) MAXIMUM CONSOLIDATED CAPITAL EXPENDITURES. Holdings shall not,
and shall not permit its Subsidiaries to, make or incur
Consolidated Capital Expenditures, in any Fiscal Year beginning
with the Fiscal Year 2004, in an aggregate amount for Holdings
and its Subsidiaries in excess of $30,000,000 in any Fiscal Year;
provided, that 50% of any unutilized amount for any Fiscal Year
may be utilized in the next succeeding Fiscal Year, but in no
event shall any amount from any Fiscal Year prior to the
immediately preceding Fiscal Year be utilized in the calculations
of the foregoing.
(f) CERTAIN CALCULATIONS. With respect to any period during which a
Permitted Acquisition or an Asset Sale has occurred (each, a
"SUBJECT TRANSACTION"), for purposes of determining compliance
with the financial covenants set forth in this Section 6.8 (but
not for purposes of determining the Applicable Margin or
Applicable Commitment Fee Percentage), Consolidated Adjusted
EBITDA shall be calculated with respect to such period on a pro
forma basis (including pro forma adjustments arising out of
events which are directly attributable to a specific transaction,
are factually supportable and are expected to have a continuing
impact, in each case determined on a basis consistent with
Article 11 of Regulation S-X promulgated under the Securities Act
and as interpreted by the staff of the Securities and Exchange
Commission, which would include cost savings resulting from head
count reduction, closure of facilities and similar restructuring
charges, which pro forma adjustments shall be certified by the
chief financial officer of Company) using the historical audited
financial statements, to the extent available, of any business so
acquired or to be acquired or sold or to be sold and the
consolidated financial statements of Holdings and its
Subsidiaries which shall be reformulated as if such Subject
Transaction, and any Indebtedness incurred or repaid in
connection therewith, had been consummated or incurred or repaid
at the beginning of such period (and assuming that such
Indebtedness bears interest during any portion of the applicable
measurement period prior to the relevant acquisition at the
weighted average of the interest rates applicable to outstanding
Loans incurred during such period); PROVIDED, HOWEVER,
calculations of pro forma Consolidated Adjusted EBITDA with
respect to a Permitted Acquisition, the aggregate consideration
for which constitutes $3,000,000 or less, shall be based on
reasonable estimations made by Company of such pre-acquisition
EBITDA based on actual pre-acquisition revenues; PROVIDED,
FURTHER that, such Consolidated Adjusted EBITDA shall not exceed
in such case 20% of such actual pre-acquisition revenues.
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6.9 FUNDAMENTAL CHANGES; DISPOSITION OF ASSETS; ACQUISITIONS. No Credit
Party shall, nor shall it permit any of its Subsidiaries to, enter
into any transaction of merger or consolidation, or liquidate, wind-up
or dissolve itself (or suffer any liquidation or dissolution), or
convey, sell, lease or sub-lease (as lessor or sublessor), transfer or
otherwise dispose of, in one transaction or a series of transactions,
all or any part of its business, assets or property of any kind
whatsoever, whether real, personal or mixed and whether tangible or
intangible, whether now owned or hereafter acquired, or acquire by
purchase or otherwise (other than purchases or other acquisitions of
inventory, materials and equipment in the ordinary course of business)
the business, property or fixed assets of, or stock or other evidence
of beneficial ownership of, any Person or any division or line of
business or other business unit of any Person, except:
(a) any Subsidiary of Holdings may be merged with or into Company or
any Guarantor Subsidiary, or be liquidated, wound up or
dissolved, or all or any part of its business, property or assets
may be conveyed, sold, leased, transferred or otherwise disposed
of, in one transaction or a series of transactions, to Company or
any Guarantor Subsidiary; provided, in the case of such a merger,
Company or such Guarantor Subsidiary, as applicable shall be the
continuing or surviving Person;
(b) sales or other dispositions of assets that do not constitute
Asset Sales;
(c) Asset Sales, the proceeds of which (valued at the principal
amount thereof in the case of non-Cash proceeds consisting of
notes or other debt Securities and valued at fair market value in
the case of other non-Cash proceeds) (i) are less than $5,000,000
with respect to any single Asset Sale or series of related Asset
Sales and (ii) when aggregated with the proceeds of all other
Asset Sales made within the same Fiscal Year, are less than
$15,000,000; PROVIDED (1) the consideration received for such
assets shall be in an amount at least equal to the fair market
value thereof (determined in good faith by the board of directors
of Company (or similar governing body)), (2) no less than 80%
thereof shall be paid in Cash, and (3) the Net Asset Sale
Proceeds thereof shall be applied as required by Section 2.13(a);
(d) any disposition of Company's partnership interest in the Vet's
Choice joint venture with Heinz Pet Products;
(e) any disposition of Company's interest in Zoasis, Inc.;
(f) disposals of obsolete, worn out, redundant or surplus property;
(g) sales, assignments or other dispositions by Company and any of
its Subsidiaries of the Capital Stock of any of their respective
Subsidiaries to be owned, directly or indirectly, by one or more
licensed veterinarians who will be actively involved in such
Subsidiary; provided that Company designates such Subsidiary as a
Permitted Partially-Owned Subsidiary;
(h) Permitted Acquisitions, the consideration for which (excluding
the consideration paid in connection with the NPC Acquisition)
constitutes $50,000,000 or less in the aggregate in any Fiscal
Year; PROVIDED, that $5,000,000 of any unutilized amount for any
Fiscal Year may be utilized in the next immediately succeeding
Fiscal Year (but not in any Fiscal Years thereafter); PROVIDED,
FURTHER, HOWEVER, that with respect to any acquisition the
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consideration of which is greater than $12,500,000, Company shall
not make such acquisition without the prior consent of
Administrative Agent and Syndication Agent, such consent not to
be unreasonably withheld; PROVIDED, FURTHER, HOWEVER, that with
respect to any Permitted Acquisitions made in Canada, such
Permitted Acquisitions shall not exceed $30,000,000 in the
aggregate. In addition, with respect to Permitted Acquisitions of
any additional portion or all of the Capital Stock in any of the
Permitted Partially-Owned Subsidiaries the consideration shall
not exceed $2,500,000 in the aggregate in any Fiscal Year;
PROVIDED, that all Permitted Acquisitions of any additional
portion or all of the Capital Stock in any of the Permitted
Partially-Owned Subsidiaries shall reduce the $50,000,000 amount
set forth above on a dollar for dollar basis;
(i) Sales and lease backs permitted pursuant to Section 6.11; and
(j) Investments made in accordance with Section 6.7.
6.10 DISPOSAL OF SUBSIDIARY INTERESTS. Except for any sale of interests in
the Capital Stock of any of its Subsidiaries in compliance with the
provisions of Section 6.9, no Credit Party shall, (a) directly or
indirectly sell, assign, pledge or otherwise encumber or dispose of
any Capital Stock of any of its Subsidiaries, except to qualify
directors if required by applicable law; or (b) permit any of its
Subsidiaries directly or indirectly to sell, assign, pledge or
otherwise encumber or dispose of any Capital Stock of any of its
Subsidiaries, except to another Credit Party (subject to the
restrictions on such disposition otherwise imposed hereunder), or to
qualify directors if required by applicable law.
6.11 SALES AND LEASE-BACKS. No Credit Party shall, nor shall it permit any
of its Subsidiaries to, directly or indirectly, become or remain
liable as lessee or as a guarantor or other surety with respect to any
lease of any property (whether real, personal or mixed), whether now
owned or hereafter acquired, which such Credit Party (a) has sold or
transferred or is to sell or to transfer to any other Person (other
than Holdings or any of its Subsidiaries), or (b) intends to use for
substantially the same purpose as any other property which has been or
is to be sold or transferred by such Credit Party to any Person (other
than Holdings or any of its Subsidiaries) in connection with such
lease; PROVIDED, HOWEVER, that Company and its Subsidiaries may sell
and lease-back assets in an aggregate amount not to exceed $5,000,000
in any Fiscal Year.
6.12 TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES. No Credit Party shall,
nor shall it permit any of its Subsidiaries to, directly or
indirectly, enter into or permit to exist any transaction (including
the purchase, sale, lease or exchange of any property or the rendering
of any service) with any holder of 10% or more of any class of Capital
Stock of Holdings or any of its Subsidiaries or with any Affiliate of
Holdings or of any such holder, on terms that are less favorable to
Holdings or that Subsidiary, as the case may be, than those that might
be obtained at the time from a Person who is not such a holder or
Affiliate; PROVIDED, the foregoing restriction shall not apply to (a)
any transaction between Holdings, Company and any Subsidiary; (b)
reasonable and customary fees paid to members of the board of
directors (or similar governing body) of Holdings and its
Subsidiaries; (c) compensation and management equity arrangements for
officers and other employees of Holdings and its Subsidiaries entered
into in the ordinary course of business; (d) management or other fees
or expenses paid to Sponsor or any of its Affiliates pursuant to
Section 6.5(l); (e) the performance by Holdings and/or Company of
95
their respective obligations under the Related Agreements; (f) payment
of Transaction Costs to the extent such payments are made to any
holder of 10% or more of any class of Capital Stock of Holdings or any
of its Subsidiaries or to any Affiliate of Holdings or of any such
holder; and (g) sales or purchases by Company or any of its
Subsidiaries of the Capital Stock of a Subsidiary of Company;
PROVIDED, that with respect to such sales, Company designates such
Subsidiary a Permitted Partially-Owned Subsidiary, and, with respect
to such purchases, such purchases are permitted pursuant to Sections
6.1(p) and 6.5(g).
6.13 CONDUCT OF BUSINESS. From and after the Effective Date, no Credit
Party shall, nor shall it permit any of its Subsidiaries to, engage in
any business other than (i) the businesses engaged in by such Credit
Party on the Effective Date and businesses or lines of businesses the
same as, related, complementary or ancillary to, the business in which
such Credit Party is engaged as of the Effective Date and (ii) such
other lines of business as may be consented to by Requisite Lenders.
6.14 PERMITTED ACTIVITIES OF HOLDINGS. Notwithstanding anything to the
contrary contained herein, Holdings shall not (a) incur, directly or
indirectly, any Indebtedness or any other obligation or liability
whatsoever other than the Indebtedness and obligations permitted to be
incurred by Holdings under Section 6.1 (including, without limitation,
Indebtedness and obligations owing to Company, Indebtedness and
obligations under the Related Agreements, Permitted Seller Notes and
Earn-Out Obligations and Indebtedness and obligations set forth on
Schedule 6.1 for which Holdings is obligor as of the Effective Date),
obligations to pay Transaction Costs, obligations for Taxes and
administrative costs and expenses as contemplated on Sections 6.5(l)
and 6.5(m), any pre-Prior Merger liabilities of Holdings which remain
liabilities of Holdings after the Closing Date as a matter of law and
any pre-NPC Acquisition liabilities of NPC which remain liabilities of
Holdings after the Effective Date (as defined in the Existing
Agreement) as a matter of law; (b) create or suffer to exist any Lien
upon any property or assets now owned or hereafter acquired by it
other than the Liens created under the Collateral Documents to which
it is a party or permitted pursuant to Section 6.2; (c) engage in any
business or activity or own any assets other than (i) holding 100% of
the Capital Stock of Company, (ii) performing its obligations and
activities incidental thereto under the Credit Documents, and to the
extent not inconsistent therewith, the Related Agreements (iii)
performing its obligations under Permitted Seller Notes and Earn-Out
Obligations and for Taxes and administrative costs and expenses as
contemplated by Sections 6.5(l) and 6.5(m); and (iv) making Restricted
Junior Payments and Investments to the extent permitted by this
Agreement; (d) consolidate with or merge with or into, or convey,
transfer or lease all or substantially all its assets to, any Person;
(e) sell or otherwise dispose of any Capital Stock of any of its
Subsidiaries except to the extent permitted by Section 6.9; (f) create
or acquire any Subsidiary or make or own any Investment in any Person
other than Company and other than as permitted under Section 6.7(g);
or (g) fail to hold itself out to the public as a legal entity
separate and distinct from all other Persons.
6.15 AMENDMENTS OR WAIVERS OF CERTAIN RELATED AGREEMENTS. Except as set
forth in Section 6.16, no Credit Party shall nor shall it permit any
of its Subsidiaries to, agree to any material amendment, restatement,
supplement or other modification to, or waiver of, any of its material
rights under any Related Agreement after the Effective Date without in
each case obtaining the prior written consent of Requisite Lenders to
such amendment, restatement, supplement or other modification or
waiver.
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6.16 AMENDMENTS OR WAIVERS WITH RESPECT TO SUBORDINATED INDEBTEDNESS. No
Credit Party shall, nor shall it permit any of its Subsidiaries to,
amend or otherwise change the terms of any Subordinated Indebtedness,
or make any payment consistent with an amendment thereof or change
thereto, if the effect of such amendment or change is to increase the
interest rate on such Subordinated Indebtedness, change (to earlier
dates) any dates upon which payments of principal or interest are due
thereon, change any event of default or condition to an event of
default with respect thereto (other than to eliminate any such event
of default or increase any grace period related thereto), change the
redemption, prepayment or defeasance provisions thereof, change the
subordination provisions of such Subordinated Indebtedness (or of any
guaranty thereof), or if the effect of such amendment or change,
together with all other amendments or changes made, is to increase
materially the obligations of the obligor thereunder or to confer any
additional rights on the holders of such Subordinated Indebtedness (or
a trustee or other representative on their behalf) which would be
adverse to any Credit Party or Lenders.
6.17 DESIGNATION OF "SENIOR INDEBTEDNESS". Company shall not designate any
Indebtedness as "Senior Indebtedness" (as defined in the New Company
Subordinated Note Indenture) for purposes of the New Company
Subordinated Note Indenture without the prior written consent of
Requisite Lenders.
6.18 FISCAL YEAR. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, change its Fiscal Year-end from December 31.
SECTION 7. GUARANTY
7.1 GUARANTY OF THE OBLIGATIONS. Subject to the provisions of Section 7.2,
Guarantors jointly and severally hereby irrevocably and
unconditionally guaranty to Administrative Agent for the ratable
benefit of the Beneficiaries the due and punctual payment in full of
all Obligations when the same shall become due, whether at stated
maturity, by required prepayment, declaration, acceleration, demand or
otherwise (including amounts that would become due but for the
operation of the automatic stay under Section 362(a) of the Bankruptcy
Code, 11 U.S.C. 362(a)) (collectively, the "GUARANTEED OBLIGATIONS").
7.2 CONTRIBUTION BY GUARANTORS. All Guarantors desire to allocate among
themselves (collectively, the "CONTRIBUTING GUARANTORS"), in a fair
and equitable manner, their obligations arising under this Guaranty.
Accordingly, in the event any payment or distribution is made on any
date by a Guarantor (a "FUNDING GUARANTOR") under this Guaranty that
exceeds its Fair Share as of such date, such Funding Guarantor shall
be entitled to a contribution from each of the other Contributing
Guarantors in the amount of such other Contributing Guarantor's Fair
Share Shortfall as of such date, with the result that all such
contributions will cause each Contributing Guarantor's Aggregate
Payments to equal its Fair Share as of such date. "FAIR SHARE" means,
with respect to a Contributing Guarantor as of any date of
determination, an amount equal to (a) the ratio of (i) the Fair Share
Contribution Amount with respect to such Contributing Guarantor to
(ii) the aggregate of the Fair Share Contribution Amounts with respect
to all Contributing Guarantors multiplied by (b) the aggregate amount
paid or distributed on or before such date by all Funding Guarantors
under this Guaranty in respect of the obligations Guaranteed. "FAIR
SHARE SHORTFALL" means, with respect to a Contributing Guarantor as of
any date of determination, the excess, if any, of the Fair Share of
such Contributing Guarantor over
97
the Aggregate Payments of such Contributing Guarantor. "FAIR SHARE
CONTRIBUTION AMOUNT" means, with respect to a Contributing Guarantor
as of any date of determination, the maximum aggregate amount of the
obligations of such Contributing Guarantor under this Guaranty that
would not render its obligations hereunder or thereunder subject to
avoidance as a fraudulent transfer or conveyance under Section 548 of
Title 11 of the United States Code or any comparable applicable
provisions of state law; PROVIDED, solely for purposes of calculating
the "FAIR SHARE CONTRIBUTION AMOUNT" with respect to any Contributing
Guarantor for purposes of this Section 7.2, any assets or liabilities
of such Contributing Guarantor arising by virtue of any rights to
subrogation, reimbursement or indemnification or any rights to or
obligations of contribution hereunder shall not be considered as
assets or liabilities of such Contributing Guarantor. "AGGREGATE
PAYMENTS" means, with respect to a Contributing Guarantor as of any
date of determination, an amount equal to (1) the aggregate amount of
all payments and distributions made on or before such date by such
Contributing Guarantor in respect of this Guaranty (including, without
limitation, in respect of this Section 7.2), MINUS (2) the aggregate
amount of all payments received on or before such date by such
Contributing Guarantor from the other Contributing Guarantors as
contributions under this Section 7.2. The amounts payable as
contributions hereunder shall be determined as of the date on which
the related payment or distribution is made by the applicable Funding
Guarantor. The allocation among Contributing Guarantors of their
obligations as set forth in this Section 7.2 shall not be construed in
any way to limit the liability of any Contributing Guarantor
hereunder. Each Guarantor is a third party beneficiary to the
contribution agreement set forth in this Section 7.2.
7.3 PAYMENT BY GUARANTORS. Subject to Section 7.2, Guarantors hereby
jointly and severally agree, in furtherance of the foregoing and not
in limitation of any other right which any Beneficiary may have at law
or in equity against any Guarantor by virtue hereof, that upon the
failure of Company to pay any of the Guaranteed Obligations when and
as the same shall become due, whether at stated maturity, by required
prepayment, declaration, acceleration, demand or otherwise (including
amounts that would become due but for the operation of the automatic
stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. ss.
362(a)), Guarantors will upon demand pay, or cause to be paid, in
Cash, to Administrative Agent for the ratable benefit of
Beneficiaries, an amount equal to the sum of the unpaid principal
amount of all Guaranteed Obligations then due as aforesaid, accrued
and unpaid interest on such Guaranteed Obligations (including interest
which, but for Company's becoming the subject of a case under the
Bankruptcy Code, would have accrued on such Guaranteed Obligations,
whether or not a claim is allowed against Company for such interest in
the related bankruptcy case) and all other Guaranteed Obligations then
owed to Beneficiaries as aforesaid.
7.4 LIABILITY OF GUARANTORS ABSOLUTE. Each Guarantor agrees that its
obligations hereunder are irrevocable, absolute, independent and
unconditional and shall not be affected by any circumstance which
constitutes a legal or equitable discharge of a guarantor or surety
other than payment in full of the Guaranteed Obligations. In
furtherance of the foregoing and without limiting the generality
thereof, each Guarantor agrees as follows:
(a) this Guaranty is a guaranty of payment when due and not of
collectability. This Guaranty is a primary obligation of each
Guarantor and not merely a contract of surety;
98
(b) Administrative Agent may enforce this Guaranty upon the
occurrence of an Event of Default notwithstanding the existence
of any dispute between Company and any Beneficiary with respect
to the existence of such Event of Default;
(c) the obligations of each Guarantor hereunder are independent of
the obligations of Company and the obligations of any other
guarantor (including any other Guarantor) of the obligations of
Company, and a separate action or actions may be brought and
prosecuted against such Guarantor whether or not any action is
brought against Company or any of such other guarantors and
whether or not Company is joined in any such action or actions;
(d) payment by any Guarantor of a portion, but not all, of the
Guaranteed Obligations shall in no way limit, affect, modify or
abridge any Guarantor's liability for any portion of the
Guaranteed Obligations which has not been paid. Without limiting
the generality of the foregoing, if Administrative Agent is
awarded a judgment in any suit brought to enforce any Guarantor's
covenant to pay a portion of the Guaranteed Obligations, such
judgment shall not be deemed to release such Guarantor from its
covenant to pay the portion of the Guaranteed Obligations that is
not the subject of such suit, and such judgment shall not, except
to the extent satisfied by such Guarantor, limit, affect, modify
or abridge any other Guarantor's liability hereunder in respect
of the Guaranteed Obligations;
(e) any Beneficiary, upon such terms as it deems appropriate, without
notice or demand and without affecting the validity or
enforceability hereof or giving rise to any reduction,
limitation, impairment, discharge or termination of any
Guarantor's liability hereunder, from time to time may (i) renew,
extend, accelerate, increase the rate of interest on, or
otherwise change the time, place, manner or terms of payment of
the Guaranteed Obligations; (ii) settle, compromise, release or
discharge, or accept or refuse any offer of performance with
respect to, or substitutions for, the Guaranteed Obligations or
any agreement relating thereto and/or subordinate the payment of
the same to the payment of any other obligations; (iii) request
and accept other guaranties of the Guaranteed Obligations and
take and hold security for the payment hereof or the Guaranteed
Obligations; (iv) release, surrender, exchange, substitute,
compromise, settle, rescind, waive, alter, subordinate or modify,
with or without consideration, any security for payment of the
Guaranteed Obligations, any other guaranties of the Guaranteed
Obligations, or any other obligation of any Person (including any
other Guarantor) with respect to the Guaranteed Obligations; (v)
enforce and apply any security now or hereafter held by or for
the benefit of such Beneficiary in respect hereof or the
Guaranteed Obligations and direct the order or manner of sale
thereof, or exercise any other right or remedy that such
Beneficiary may have against any such security, in each case as
such Beneficiary in its discretion may determine consistent
herewith or the applicable Hedge Agreement and any applicable
security agreement, including foreclosure on any such security
pursuant to one or more judicial or nonjudicial sales, whether or
not every aspect of any such sale is commercially reasonable, and
even though such action operates to impair or extinguish any
right of reimbursement or subrogation or other right or remedy of
any Guarantor against Company or any security for the Guaranteed
Obligations; and (vi) exercise any other rights available to it
under the Credit Documents or the Hedge Agreements; and
(f) this Guaranty and the obligations of Guarantors hereunder shall
be valid and enforceable and shall not be subject to any
reduction, limitation, impairment, discharge or
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termination for any reason (other than payment in full of the
Guaranteed Obligations), including the occurrence of any of the
following, whether or not any Guarantor shall have had notice or
knowledge of any of them: (i) any failure or omission to assert
or enforce or agreement or election not to assert or enforce, or
the stay or enjoining, by order of court, by operation of law or
otherwise, of the exercise or enforcement of, any claim or demand
or any right, power or remedy (whether arising under the Credit
Documents or the Hedge Agreements, at law, in equity or
otherwise) with respect to the Guaranteed Obligations or any
agreement relating thereto, or with respect to any other guaranty
of or security for the payment of the Guaranteed Obligations;
(ii) any rescission, waiver, amendment or modification of, or any
consent to departure from, any of the terms or provisions
(including provisions relating to events of default) hereof, any
of the other Credit Documents, any of the Hedge Agreements or any
agreement or instrument executed pursuant thereto, or of any
other guaranty or security for the Guaranteed Obligations, in
each case whether or not in accordance with the terms hereof or
such Credit Document, such Hedge Agreement or any agreement
relating to such other guaranty or security; (iii) the Guaranteed
Obligations, or any agreement relating thereto, at any time being
found to be illegal, invalid or unenforceable in any respect;
(iv) the application of payments received from any source (other
than payments received pursuant to the other Credit Documents or
any of the Hedge Agreements or from the proceeds of any security
for the Guaranteed Obligations, except to the extent such
security also serves as collateral for indebtedness other than
the Guaranteed Obligations) to the payment of indebtedness other
than the Guaranteed Obligations, even though any Beneficiary
might have elected to apply such payment to any part or all of
the Guaranteed Obligations; (v) any Beneficiary's consent to the
change, reorganization or termination of the corporate structure
or existence of Holdings or any of its Subsidiaries and to any
corresponding restructuring of the Guaranteed Obligations; (vi)
any failure to perfect or continue perfection of a security
interest in any collateral which secures any of the Guaranteed
Obligations; (vii) any defenses, set-offs or counterclaims which
Company may allege or assert against any Beneficiary in respect
of the Guaranteed Obligations, including failure of
consideration, breach of warranty, payment, statute of frauds,
statute of limitations, accord and satisfaction and usury; and
(viii) any other act or thing or omission, or delay to do any
other act or thing, which may or might in any manner or to any
extent vary the risk of any Guarantor as an obligor in respect of
the Guaranteed Obligations.
7.5 WAIVERS BY GUARANTORS. Each Guarantor hereby waives, for the benefit
of Beneficiaries: (a) any right to require any Beneficiary, as a
condition of payment or performance by such Guarantor, to (i) proceed
against Company, any other guarantor (including any other Guarantor)
of the Guaranteed Obligations or any other Person, (ii) proceed
against or exhaust any security held from Company, any such other
guarantor or any other Person, (iii) proceed against or have resort to
any balance of any Deposit Account or credit on the books of any
Beneficiary in favor of Company or any other Person, or (iv) pursue
any other remedy in the power of any Beneficiary whatsoever; (b) any
defense arising by reason of the incapacity, lack of authority or any
disability or other defense of Company or any other Guarantor
including any defense based on or arising out of the lack of validity
or the unenforceability of the Guaranteed Obligations or any agreement
or instrument relating thereto or by reason of the cessation of the
liability of Company or any other Guarantor from any cause other than
payment in full of the Guaranteed Obligations; (c) any defense based
upon any statute or rule of law which provides that the obligation of
a surety must be neither larger in amount nor in other respects more
burdensome than that of the principal; (d) any defense based upon any
Beneficiary's errors or
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omissions in the administration of the Guaranteed Obligations, except
behavior which amounts to bad faith; (e) (i) any principles or
provisions of law, statutory or otherwise, which are or might be in
conflict with the terms hereof and any legal or equitable discharge of
such Guarantor's obligations hereunder, (ii) the benefit of any
statute of limitations affecting such Guarantor's liability hereunder
or the enforcement hereof, (iii) any rights to set-offs, recoupments
and counterclaims, and (iv) promptness, diligence and any requirement
that any Beneficiary protect, secure, perfect or insure any security
interest or lien or any property subject thereto; (f) notices,
demands, presentments, protests, notices of protest, notices of
dishonor and notices of any action or inaction, including acceptance
hereof, notices of default hereunder, the Hedge Agreements or any
agreement or instrument related thereto, notices of any renewal,
extension or modification of the Guaranteed Obligations or any
agreement related thereto, notices of any extension of credit to
Company and notices of any of the matters referred to in Section 7.4
and any right to consent to any thereof; and (g) any defenses or
benefits that may be derived from or afforded by law which limit the
liability of or exonerate guarantors or sureties, or which may
conflict with the terms hereof.
7.6 GUARANTORS' RIGHTS OF SUBROGATION, CONTRIBUTION, ETC. Until the
Guaranteed Obligations shall have been indefeasibly paid in full and
the Revolving Commitments shall have terminated each Guarantor hereby
waives any claim, right or remedy, direct or indirect, that such
Guarantor now has or may hereafter have against Company or any other
Guarantor or any of its assets in connection with this Guaranty or the
performance by such Guarantor of its obligations hereunder, in each
case whether such claim, right or remedy arises in equity, under
contract, by statute, under common law or otherwise and including
without limitation (a) any right of subrogation, reimbursement or
indemnification that such Guarantor now has or may hereafter have
against Company with respect to the Guaranteed Obligations, (b) any
right to enforce, or to participate in, any claim, right or remedy
that any Beneficiary now has or may hereafter have against Company,
and (c) any benefit of, and any right to participate in, any
collateral or security now or hereafter held by any Beneficiary. In
addition, until the Guaranteed Obligations shall have been
indefeasibly paid in full and the Revolving Commitments shall have
terminated each Guarantor shall withhold exercise of any right of
contribution such Guarantor may have against any other guarantor
(including any other Guarantor) of the Guaranteed Obligations,
including, without limitation, any such right of contribution as
contemplated by Section 7.2. Each Guarantor further agrees that, to
the extent the waiver or agreement to withhold the exercise of its
rights of subrogation, reimbursement, indemnification and contribution
as set forth herein is found by a court of competent jurisdiction to
be void or voidable for any reason, any rights of subrogation,
reimbursement or indemnification such Guarantor may have against
Company or against any collateral or security, and any rights of
contribution such Guarantor may have against any such other guarantor,
shall be junior and subordinate to any rights any Beneficiary may have
against Company, to all right, title and interest any Beneficiary may
have in any such collateral or security, and to any right any
Beneficiary may have against such other guarantor. If any amount shall
be paid to any Guarantor on account of any such subrogation,
reimbursement, indemnification or contribution rights at any time when
all Guaranteed Obligations shall not have been paid in full, such
amount shall be held in trust for Administrative Agent on behalf of
Beneficiaries and shall forthwith be paid over to Administrative Agent
for the benefit of Beneficiaries to be credited and applied against
the Guaranteed Obligations, whether matured or unmatured, in
accordance with the terms hereof.
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7.7 SUBORDINATION OF OTHER OBLIGATIONS. Any Indebtedness of Company or any
Guarantor now or hereafter held by any Guarantor (the "OBLIGEE
GUARANTOR") is hereby subordinated in right of payment to the
Guaranteed Obligations, and any such indebtedness collected or
received by the Obligee Guarantor after an Event of Default has
occurred and is continuing shall be held in trust for Administrative
Agent on behalf of Beneficiaries and shall forthwith be paid over to
Administrative Agent for the benefit of Beneficiaries to be credited
and applied against the Guaranteed Obligations but without affecting,
impairing or limiting in any manner the liability of the Obligee
Guarantor under any other provision hereof.
7.8 CONTINUING GUARANTY. This Guaranty is a continuing guaranty and shall
remain in effect until all of the Guaranteed Obligations shall have
been finally and indefeasibly paid in full and the Revolving
Commitments shall have terminated. Each Guarantor hereby irrevocably
waives any right to revoke this Guaranty as to future transactions
giving rise to any Guaranteed Obligations.
7.9 AUTHORITY OF GUARANTORS OR COMPANY. It is not necessary for any
Beneficiary to inquire into the capacity or powers of any Guarantor or
Company or the officers, directors or any agents acting or purporting
to act on behalf of any of them.
7.10 FINANCIAL CONDITION OF COMPANY. Any Credit Extension may be made to
Company or continued from time to time, and any Hedge Agreements may
be entered into from time to time, in each case without notice to or
authorization from any Guarantor regardless of the financial or other
condition of Company at the time of any such grant or continuation or
at the time such Hedge Agreement is entered into, as the case may be.
No Beneficiary shall have any obligation to disclose or discuss with
any Guarantor its assessment, or any Guarantor's assessment, of the
financial condition of Company. Each Guarantor has adequate means to
obtain information from Company on a continuing basis concerning the
financial condition of Company and its ability to perform its
obligations under the Credit Documents and the Hedge Agreements, and
each Guarantor assumes the responsibility for being and keeping
informed of the financial condition of Company and of all
circumstances bearing upon the risk of nonpayment of the Guaranteed
Obligations. Each Guarantor hereby waives and relinquishes any duty on
the part of any Beneficiary to disclose any matter, fact or thing
relating to the business, operations or conditions of Company now
known or hereafter known by any Beneficiary.
7.11 BANKRUPTCY, ETC(a) . (a) So long as any Guaranteed Obligations remain
outstanding, no Guarantor shall, without the prior written consent of
Administrative Agent acting pursuant to the instructions of Requisite
Lenders, commence or join with any other Person in commencing any
bankruptcy, reorganization or insolvency case or proceeding of or
against Company or any other Guarantor. The obligations of Guarantors
hereunder shall not be reduced, limited, impaired, discharged,
deferred, suspended or terminated by any case or proceeding, voluntary
or involuntary, involving the bankruptcy, insolvency, receivership,
reorganization, liquidation or arrangement of Company or any other
Guarantor or by any defense which Company or any other Guarantor may
have by reason of the order, decree or decision of any court or
administrative body resulting from any such proceeding.
(b) Each Guarantor acknowledges and agrees that any interest on any
portion of the Guaranteed Obligations which accrues after the
commencement of any case or proceeding
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referred to in clause (a) above (or, if interest on any portion
of the Guaranteed Obligations ceases to accrue by operation of
law by reason of the commencement of such case or proceeding,
such interest as would have accrued on such portion of the
Guaranteed Obligations if such case or proceeding had not been
commenced) shall be included in the Guaranteed Obligations
because it is the intention of Guarantors and Beneficiaries that
the Guaranteed Obligations which are Guaranteed by Guarantors
pursuant hereto should be determined without regard to any rule
of law or order which may relieve Company of any portion of such
Guaranteed Obligations. Guarantors will permit any trustee in
bankruptcy, receiver, debtor in possession, assignee for the
benefit of creditors or similar person to pay Administrative
Agent, or allow the claim of Administrative Agent in respect of,
any such interest accruing after the date on which such case or
proceeding is commenced.
(c) In the event that all or any portion of the Guaranteed
Obligations are paid by Company, the obligations of Guarantors
hereunder shall continue and remain in full force and effect or
be reinstated, as the case may be, in the event that all or any
part of such payment(s) are rescinded or recovered directly or
indirectly from any Beneficiary as a preference, fraudulent
transfer or otherwise, and any such payments which are so
rescinded or recovered shall constitute Guaranteed Obligations
for all purposes hereunder.
7.12 DISCHARGE OF GUARANTY UPON SALE OF GUARANTOR. If all of the Capital
Stock of any Guarantor or any of its successors in interest hereunder
shall be sold or otherwise disposed of (including by merger or
consolidation) in accordance with the terms and conditions hereof, the
Guaranty of such Guarantor or such successor in interest, as the case
may be, hereunder shall automatically be discharged and released
without any further action by any Beneficiary or any other Person
effective as of the time of such Asset Sale.
SECTION 8. EVENTS OF DEFAULT
8.1 EVENTS OF DEFAULT. If any one or more of the following conditions or
events shall occur:
(a) FAILURE TO MAKE PAYMENTS WHEN DUE. Failure by Company to pay (i)
when due any installment of principal of any Loan, whether at
stated maturity, by acceleration, by notice of voluntary
prepayment, by mandatory prepayment or otherwise; (ii) when due
any amount payable to Issuing Bank in reimbursement of any
drawing under a Letter of Credit; or (iii) any interest on any
Loan or any fee or any other amount due hereunder within five (5)
days after the date due; or
(b) DEFAULT IN OTHER AGREEMENTS. (i) Failure of any Credit Party or
any of their respective Subsidiaries to pay when due any
principal of or interest on or any other amount payable in
respect of one or more items of Indebtedness (other than
Indebtedness referred to in Section 8.1(a)) in a principal amount
of $3,500,000 or more, beyond the grace period, if any, provided
~therefore and the holder of such Indebtedness has any rights or
remedies exercisable as a result of such failure; or (ii) breach
or default by any Credit Party with respect to any other material
term of (1) one or more items of Indebtedness in the individual
or aggregate principal amounts referred to in clause (i) above or
(2) any loan agreement, mortgage, indenture or other agreement
relating to such item(s) of Indebtedness, in each case beyond the
grace period, if any,
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provided therefore, if the effect of such breach or default is to
cause, or to permit the holder or holders of that Indebtedness
(or a trustee on behalf of such holder or holders), to cause,
that Indebtedness to become or be declared due and payable (or
redeemable) prior to its stated maturity or the stated maturity
of any underlying obligation, as the case may be; or
(c) BREACH OF CERTAIN COVENANTS. Failure of any Credit Party to
perform or comply with any term or condition contained in Section
2.5, Section 5.2 or Section 6; or
(d) BREACH OF REPRESENTATIONS, ETC. Any representation, warranty,
certification or other statement made or deemed made by any
Credit Party in any Credit Document or in any statement or
certificate at any time given by any Credit Party or any of its
Subsidiaries in writing pursuant hereto or thereto or in
connection herewith or therewith shall be false in any material
respect as of the date made or deemed made; or
(e) OTHER DEFAULTS UNDER CREDIT DOCUMENTS. Any Credit Party shall
default in the performance of or compliance with any term
contained herein or any of the other Credit Documents, other than
any such term referred to in any other Section of this Section
8.1, and such default shall not have been remedied or waived
within thirty (30) days after the earlier of (i) an officer of
such Credit Party becoming aware of such default or (ii) receipt
by Company of notice from Administrative Agent or any Lender of
such default; or
(f) INVOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC. (i) A court
of competent jurisdiction shall enter a decree or order for
relief in respect of Holdings or any of its Subsidiaries (other
than Immaterial Subsidiaries) in an involuntary case under the
Bankruptcy Code or under any other applicable bankruptcy,
insolvency or similar law now or hereafter in effect, which
decree or order is not stayed; or any other similar relief shall
be granted under any applicable federal or state law; or (ii) an
involuntary case shall be commenced against Holdings or any of
its Subsidiaries (other than Immaterial Subsidiaries) under the
Bankruptcy Code or under any other applicable bankruptcy,
insolvency or similar law now or hereafter in effect; or a decree
or order of a court having jurisdiction in the premises for the
appointment of a receiver, liquidator, sequestrator, trustee,
custodian or other officer having similar powers over Holdings or
any of its Subsidiaries (other than Immaterial Subsidiaries), or
over all or a substantial part of its property, shall have been
entered; or there shall have occurred the involuntary appointment
of an interim receiver, trustee or other custodian of Holdings or
any of its Subsidiaries (other than Immaterial Subsidiaries) for
all or a substantial part of its property; or a warrant of
attachment, execution or similar process shall have been issued
against any substantial part of the property of Holdings or any
of its Subsidiaries (other than Immaterial Subsidiaries), and any
such event described in this clause (ii) shall continue for sixty
(60) days without having been dismissed, bonded or discharged; or
(g) VOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC. (i) Holdings
or any of its Subsidiaries (other than Immaterial Subsidiaries)
shall have an order for relief entered with respect to it or
shall commence a voluntary case under the Bankruptcy Code or
under any other applicable bankruptcy, insolvency or similar law
now or hereafter in effect, or shall consent to the entry of an
order for relief in an involuntary case, or to the conversion of
an involuntary case to a voluntary case, under any such law, or
shall consent to the appointment of or taking possession by a
receiver, trustee or other custodian for all or a substantial
part of its property; or
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Holdings or any of its Subsidiaries (other than Immaterial
Subsidiaries) shall make any assignment for the benefit of
creditors; or (ii) Holdings or any of its Subsidiaries (other
than Immaterial Subsidiaries) shall be unable, or shall fail
generally, or shall admit in writing its inability, to pay its
debts as such debts become due; or the board of directors (or
similar governing body) of Holdings or any of its Subsidiaries
(other than Immaterial Subsidiaries) (or any committee thereof)
shall adopt any resolution or otherwise authorize any action to
approve any of the actions referred to herein or in Section
8.1(f); or
(h) JUDGMENTS AND ATTACHMENTS. Any money judgment, writ or warrant of
attachment or similar process involving an amount in excess of
$3,500,000 (to the extent not adequately covered by insurance as
to which a solvent and unaffiliated insurance Company has
acknowledged coverage) shall be entered or filed against Holdings
or any of its Subsidiaries or any of their respective assets and
shall remain undischarged, unvacated, unbonded or unstayed for a
period of sixty (60) days (or in any event later than five days
prior to the date of any proposed sale thereunder); or
(i) DISSOLUTION. Any order, judgment or decree shall be entered
against any Credit Party decreeing the dissolution or split up of
such Credit Party and such order shall remain undischarged or
unstayed for a period in excess of thirty (30) days; or
(j) EMPLOYEE BENEFIT PLANS. There shall occur one or more ERISA
Events which individually or in the aggregate results in or might
reasonably be expected to result in liability of Holdings, any of
its Subsidiaries or any of their respective ERISA Affiliates in
excess of $3,500,000 during the term hereof; there shall exist
one or more facts or circumstances that might reasonably be
expected to result in the imposition of a Lien pursuant to
Section 401(a)(29) or 412(n) of the Internal Revenue Code or
pursuant to ERISA with respect to any Pension Plan; or there
shall exist an amount of ~therefore benefit liabilities (as
defined in Section 4001(a)(18) of ERISA), individually or in the
aggregate for all Pension Plans (excluding for purposes of such
computation any Pension Plans with respect to which assets exceed
benefit liabilities), which exceeds $3,500,000; or
(k) CHANGE OF CONTROL. A Change of Control shall occur; or
(l) GUARANTIES, COLLATERAL DOCUMENTS AND OTHER CREDIT DOCUMENTS. At
any time after the execution and delivery thereof, (i) the
Guaranty for any reason, other than the satisfaction in full of
all Obligations, shall cease to be in full force and effect
(other than in accordance with its terms) or shall be declared to
be null and void or any Guarantor shall repudiate its obligations
thereunder, (ii) this Agreement or any Collateral Document ceases
to be in full force and effect (other than by reason of a release
of Collateral in accordance with the terms hereof or thereof or
the satisfaction in full of the Obligations in accordance with
the terms hereof) or shall be declared null and void, or
Collateral Agent shall not have or shall cease to have a valid
and perfected Lien in any Collateral purported to be covered by
the Collateral Documents with the priority required by the
relevant Collateral Document, in each case for any reason other
than the failure of Collateral Agent or any Secured Party to take
any action within its control, or (iii) any Credit Party shall
contest the validity or enforceability of any Credit Document in
writing or deny in writing that it has any further liability,
including with respect to future advances by Lenders, under any
Credit Document to which it is a party;
105
THEN, (1) upon the occurrence of any Event of Default described
in Section 8.1(f) or 8.1(g), automatically, and (2) upon the
occurrence of any other Event of Default, at the request of (or
with the consent of) Requisite Lenders, upon notice to Company by
Administrative Agent, (A) the Revolving Commitments, if any, of
each Lender having such Revolving Commitments and the obligation
of Issuing Bank to issue any Letter of Credit shall immediately
terminate; (B) each of the following shall immediately become due
and payable, in each case without presentment, demand, protest or
other requirements of any kind, all of which are hereby expressly
waived by each Credit Party: (I) the unpaid principal amount of
and accrued interest on the Loans, (II) an amount equal to the
maximum amount that may at any time be drawn under all Letters of
Credit then outstanding (regardless of whether any beneficiary
under any such Letter of Credit shall have presented, or shall be
entitled at such time to present, the drafts or other documents
or certificates required to draw under such Letters of Credit),
and (III) all other Obligations; PROVIDED, the foregoing shall
not affect in any way the obligations of Lenders under Section
2.3(b)(iv) or Section 2.23(e); (C) Administrative Agent may cause
Collateral Agent to enforce any and all Liens and security
interests created pursuant to Collateral Documents; and (D)
Administrative Agent shall direct Company to pay (and Company
hereby agrees upon receipt of such notice, or upon the occurrence
of any Event of Default specified in Section 8.1(f) and (g) to
pay) to Administrative Agent such additional amounts of cash, to
be held as security for Company's reimbursement Obligations in
respect of Letters of Credit then outstanding, equal to the
Letter of Credit Usage at such time.
Notwithstanding any of the foregoing to the contrary set forth
herein, it shall not constitute an Event of Default hereunder if
any of the circumstances described above in Sections 8.1(f),
8.1(g), 8.1(i) and 8.1(l) shall have occurred with respect to one
or more Subsidiaries of Company which in the aggregate do not
account for more than 2.50% of Company's total Consolidated
Adjusted EBITDA for the four-Fiscal Quarter period most recently
ended.
SECTION 9. AGENTS
9.1 APPOINTMENT OF AGENTS. GSCP and Wells Fargo are hereby appointed Joint
Lead Arrangers and GSCP is hereby appointed Syndication Agent
hereunder, and each Lender hereby authorizes Lead Arrangers and
Syndication Agent to act as its agents in accordance with the terms
hereof and the other Credit Documents. Wells Fargo is hereby appointed
Administrative Agent hereunder and under the other Credit Documents
and each Lender hereby authorizes Administrative Agent to act as its
agent in accordance with the terms hereof and the other Credit
Documents. Each Agent hereby agrees to act upon the express conditions
contained herein and the other Credit Documents, as applicable. The
provisions of this Section 9 are solely for the benefit of Agents and
Lenders and no Credit Party shall have any rights as a third party
beneficiary of any of the provisions hereof. In performing its
functions and duties hereunder, each Agent shall act solely as an
agent of Lenders and does not assume and shall not be deemed to have
assumed any obligation towards or relationship of agency or trust with
or for Holdings or any of its Subsidiaries. Syndication Agent, without
consent of or notice to any party hereto, may assign any and all of
its rights or obligations hereunder to any of its Affiliates. As of
the Effective Date, all the respective obligations of GSCP and Wells
Fargo, in their capacity as Lead Arrangers and GSCP, in its capacity
as Syndication Agent, shall terminate.
106
9.2 POWERS AND DUTIES. Each Lender irrevocably authorizes each Agent to
take such action on such Lender's behalf and to exercise such powers,
rights and remedies hereunder and under the other Credit Documents as
are specifically delegated or granted to such Agent by the terms
hereof and thereof, together with such powers, rights and remedies as
are reasonably incidental thereto. Each Agent shall have only those
duties and responsibilities that are expressly specified herein and
the other Credit Documents. Each Agent may exercise such powers,
rights and remedies and perform such duties by or through its agents
or employees. No Agent shall have, by reason hereof or any of the
other Credit Documents, a fiduciary relationship in respect of any
Lender; and nothing herein or any of the other Credit Documents,
expressed or implied, is intended to or shall be so construed as to
impose upon any Agent any obligations in respect hereof or any of the
other Credit Documents except as expressly set forth herein or
therein.
9.3 GENERAL IMMUNITY.
(a) NO RESPONSIBILITY FOR CERTAIN MATTERS. No Agent shall be
responsible to any Lender for the execution, effectiveness,
genuineness, validity, enforceability, collectability or
sufficiency hereof or any other Credit Document or for any
representations, warranties, recitals or statements made herein
or therein or made in any written or oral statements or in any
financial or other statements, instruments, reports or
certificates or any other documents furnished or made by any of
Agent to Lenders or by or on behalf of any Credit Party to any
Agent or any Lender in connection with the Credit Documents and
the transactions contemplated thereby or for the financial
condition or business affairs of any Credit Party or any other
Person liable for the payment of any Obligations, nor shall any
Agent be required to ascertain or inquire as to the performance
or observance of any of the terms, conditions, provisions,
covenants or agreements contained in any of the Credit Documents
or as to the use of the proceeds of the Loans or as to the
existence or possible existence of any Event of Default or
Default. Anything contained herein to the contrary
notwithstanding, Administrative Agent shall not have any
liability arising from confirmations of the amount of outstanding
Loans or the Letter of Credit Usage or the component amounts
thereof.
(b) EXCULPATORY PROVISIONS. No Agent nor any of its officers,
partners, directors, employees or agents shall be liable to
Lenders for any action taken or omitted by any Agent under or in
connection with any of the Credit Documents except to the extent
caused by such Agent's gross negligence or willful misconduct.
Each Agent shall be entitled to refrain from any act or the
taking of any action (including the failure to take an action) in
connection herewith or any of the other Credit Documents or from
the exercise of any power, discretion or authority vested in it
hereunder or thereunder unless and until such Agent shall have
received instructions in respect thereof from Requisite Lenders
(or such other Lenders as may be required to give such
instructions under Section 10.5) and, upon receipt of such
instructions from Requisite Lenders (or such other Lenders, as
the case may be), such Agent shall be entitled to act or (where
so instructed) refrain from acting, or to exercise such power,
discretion or authority, in accordance with such instructions.
Without prejudice to the generality of the foregoing, (i) each
Agent shall be entitled to rely, and shall be fully protected in
relying, upon any communication, instrument or document believed
by it to be genuine and correct and to have been signed or sent
by the proper Person or Persons, and shall be entitled to rely
and shall be protected in relying on opinions and judgments of
attorneys (who may be attorneys for Holdings and its
Subsidiaries), accountants, experts and other professional
advisors selected by it; and (ii) no Lender shall have
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any right of action whatsoever against any Agent as a result of
such Agent acting or (where so instructed) refraining from acting
hereunder or any of the other Credit Documents in accordance with
the instructions of Requisite Lenders (or such other Lenders as
may be required to give such instructions under Section 10.5).
9.4 AGENTS ENTITLED TO ACT AS LENDER. The agency hereby created shall in
no way impair or affect any of the rights and powers of, or impose any
duties or obligations upon, any Agent in its individual capacity as a
Lender hereunder. With respect to its participation in the Loans, each
Agent shall have the same rights and powers hereunder as any other
Lender and may exercise the same as if it were not performing the
duties and functions delegated to it hereunder, and the term "Lender"
shall, unless the context clearly otherwise indicates, include each
Agent in its individual capacity. Any Agent and its Affiliates may
accept deposits from, lend money to and generally engage in any kind
of banking, trust, financial advisory or other business with Holdings
or any of its Affiliates as if it were not performing the duties
specified herein, and may accept fees and other consideration from
Company for services in connection herewith and otherwise without
having to account for the same to Lenders.
9.5 LENDERS' REPRESENTATIONS, WARRANTIES AND ACKNOWLEDGMENT.
(a) Each Lender represents and warrants that it has made its own
independent investigation of the financial condition and affairs
of Holdings and its Subsidiaries in connection with Credit
Extensions hereunder and that it has made and shall continue to
make its own appraisal of the creditworthiness of Holdings and
its Subsidiaries. No Agent shall have any duty or responsibility,
either initially or on a continuing basis, to make any such
investigation or any such appraisal on behalf of Lenders or to
provide any Lender with any credit or other information with
respect thereto, whether coming into its possession before the
making of the Loans or at any time or times thereafter, and no
Agent shall have any responsibility with respect to the accuracy
of or the completeness of any information provided to Lenders.
(b) Each Lender, by delivering its signature page to this Agreement
and funding its Tranche F Term Loan and/or a Revolving Loan on
the Effective Date, shall be deemed to have acknowledged receipt
of, and consented to and approved, each Credit Document and each
other document required to be approved by any Agent, Requisite
Lenders or Lenders, as applicable on the Effective Date.
9.6 RIGHT TO INDEMNITY. Each Lender, in proportion to its Pro Rata Share,
severally agrees to indemnify each Agent, to the extent that such
Agent shall not have been reimbursed by any Credit Party, for and
against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses (including
counsel fees and disbursements) or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by or asserted against
such Agent in exercising its powers, rights and remedies or performing
its duties hereunder or under the other Credit Documents or otherwise
in its capacity as such Agent in any way relating to or arising out
hereof or the other Credit Documents; PROVIDED, no Lender shall be
liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from such Agent's gross negligence or willful
misconduct. If any indemnity furnished to any Agent for any purpose
shall, in the opinion of such Agent, be insufficient or become
impaired, such Agent may call for additional
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indemnity and cease, or not commence, to do the acts indemnified
against until such additional indemnity is furnished; PROVIDED, in no
event shall this sentence require any Lender to indemnify any Agent
against any liability, obligation, loss, damage, penalty, action,
judgment, suit, cost, expense or disbursement in excess of such
Lender's Pro Rata Share thereof; and provided FURTHER, this sentence
shall not be deemed to require any Lender to indemnify any Agent
against any liability, obligation, loss, damage, penalty, action,
judgment, suit, cost, expense or disbursement described in the proviso
in the immediately preceding sentence.
9.7 SUCCESSOR ADMINISTRATIVE AGENT AND SWING LINE LENDER. Administrative
Agent may resign at any time by giving thirty (30) days' prior written
notice thereof to Lenders and Company, and Administrative Agent may be
removed at any time with or without cause by an instrument or
concurrent instruments in writing delivered to Company and
Administrative Agent and signed by Requisite Lenders. Upon any such
notice of resignation or any such removal, Requisite Lenders shall
have the right, upon five Business Days' notice to Company, to appoint
a successor Administrative Agent. Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor
Administrative Agent, that successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring or removed Administrative Agent
and the retiring or removed Administrative Agent shall promptly (i)
transfer to such successor Administrative Agent all sums, Securities
and other items of Collateral held under the Collateral Documents,
together with all records and other documents necessary or appropriate
in connection with the performance of the duties of the successor
Administrative Agent under the Credit Documents, and (ii) execute and
deliver to such successor Administrative Agent such amendments to
financing statements, and take such other actions, as may be necessary
or appropriate in connection with the assignment to such successor
Administrative Agent of the security interests created under the
Collateral Documents, whereupon such retiring or removed
Administrative Agent shall be discharged from its duties and
obligations hereunder. After any retiring or removed Administrative
Agent's resignation or removal hereunder as Administrative Agent, the
provisions of this Section 9 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent
hereunder. Any resignation or removal of Administrative Agent pursuant
to this Section shall also constitute the resignation or removal of
Wells Fargo or its successor as Swing Line Lender, and any successor
Administrative Agent appointed pursuant to this Section shall, upon
its acceptance of such appointment, become the successor Swing Line
Lender for all purposes hereunder. In such event (a) Company shall
prepay any outstanding Swing Line Loans made by the retiring or
removed Administrative Agent in its capacity as Swing Line Lender, (b)
upon such prepayment, the retiring or removed Administrative Agent and
Swing Line Lender shall surrender any Swing Line Note held by it to
Company for cancellation, and (c) Company shall issue, if so requested
by Successor Administrative Agent and Swing Line Loan Lender, a new
Swing Line Note to the successor Administrative Agent and Swing Line
Lender, in the principal amount of the Swing Line Loan Sublimit then
in effect and with other appropriate insertions.
9.8 COLLATERAL DOCUMENTS AND GUARANTY.
(a) AGENTS UNDER COLLATERAL DOCUMENTS AND GUARANTY. Each Lender
hereby further authorizes Agent, on behalf of and for the benefit
of Lenders, to be the agent for and representative of Lenders
with respect to the Guaranty, the Collateral and the Collateral
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Documents. Subject to Section 10.5, without further written
consent or authorization from Lenders, Administrative Agent or
Collateral Agent, as applicable, may execute any documents or
instruments necessary to (i) release any Lien encumbering any
item of Collateral that is the subject of a sale or other
disposition of assets permitted hereby or to which Requisite
Lenders (or such other Lenders as may be required to give such
consent under Section 10.5) have otherwise consented or (ii)
release any Guarantor from the Guaranty pursuant to Section 7.13
or with respect to which Requisite Lenders (or such other Lenders
as may be required to give such consent under Section 10.5) have
otherwise consented.
(b) RIGHT TO REALIZE ON COLLATERAL AND ENFORCE GUARANTY. Anything
contained in any of the Credit Documents to the contrary
notwithstanding, Company, Administrative Agent, Collateral Agent
and each Lender hereby agree that (i) no Lender shall have any
right individually to realize upon any of the Collateral or to
enforce the Guaranty, it being understood and agreed that all
powers, rights and remedies hereunder may be exercised solely by
Administrative Agent, on behalf of Lenders in accordance with the
terms hereof and all powers, rights and remedies under the
Collateral Documents may be exercised solely by Collateral Agent,
and (ii) in the event of a foreclosure by Collateral Agent on any
of the Collateral pursuant to a public or private sale,
Administrative Agent or any Lender may be the purchaser of any or
all of such Collateral at any such sale and Collateral Agent, as
agent for and representative of Secured Parties (but not any
Lender or Lenders in its or their respective individual
capacities unless Requisite Lenders shall otherwise agree in
writing) shall be entitled, for the purpose of bidding and making
settlement or payment of the purchase price for all or any
portion of the Collateral sold at any such public sale, to use
and apply any of the Obligations as a credit on account of the
purchase price for any collateral payable by Collateral Agent at
such sale.
SECTION 10. MISCELLANEOUS
10.1 NOTICES. Unless otherwise specifically provided herein, any notice or
other communication herein required or permitted to be given to a
Credit Party, Lead Arrangers, Syndication Agent, Collateral Agent,
Administrative Agent, Swing Line Lender or Issuing Bank, shall be sent
to such Person's address as set forth on Appendix B or in the other
relevant Credit Document, and in the case of any Lender, the address
as indicated on Appendix B or otherwise indicated to Administrative
Agent in writing. Each notice hereunder shall be in writing and may be
personally served, telexed or sent by telefacsimile or United States
mail or courier service and shall be deemed to have been given when
delivered in person or by courier service and signed for against
receipt thereof, upon receipt of telefacsimile or telex, or three
Business Days after depositing it in the United States mail with
postage prepaid and properly addressed; PROVIDED, no notice to any
Agent shall be effective until received by such Agent.
10.2 EXPENSES. Whether or not the transactions contemplated hereby shall be
consummated, Company agrees to pay promptly (a) all the actual and
reasonable costs and expenses of preparation of the Credit Documents
and any consents, amendments, waivers or other modifications thereto;
(b) all the costs of furnishing all opinions by counsel for Company
and the other Credit Parties; (c) the reasonable and documented fees,
expenses and disbursements of counsel to Agents (in each case
including allocated costs of internal counsel) in connection with the
negotiation, preparation, execution and administration of the Credit
Documents and any consents, amendments, waivers or other modifications
thereto and any other
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documents or matters requested by Company; (d) all the actual costs
and reasonable and documented expenses of creating and perfecting
Liens in favor of Collateral Agent, for the benefit of Lenders
pursuant hereto, including filing and recording fees, expenses and
taxes, stamp or documentary taxes, search fees, title insurance
premiums and reasonable fees, expenses and disbursements of counsel to
each Agent and of counsel providing any opinions that any Agent or
Requisite Lenders may request in respect of the Collateral or the
Liens created pursuant to the Collateral Documents; (e) all the actual
costs and reasonable and documented fees, expenses and disbursements
of any auditors, accountants, consultants or appraisers; (f) all the
actual costs and reasonable and documented expenses (including the
reasonable fees, expenses and disbursements of any appraisers,
consultants, advisors and agents employed or retained by Collateral
Agent and its counsel) in connection with the custody or preservation
of any of the Collateral; (g) all other actual and reasonable and
documented costs and expenses incurred by each Agent in connection
with the syndication of the Loans and Commitments and the negotiation,
preparation and execution of the Credit Documents and any consents,
amendments, waivers or other modifications thereto and the
transactions contemplated thereby; and (h) after the occurrence of a
Default or an Event of Default, all costs and expenses, including
reasonable and documented attorneys' fees (including allocated costs
of internal counsel) and costs of settlement, incurred by any Agent
and Lenders in enforcing any Obligations of or in collecting any
payments due from any Credit Party hereunder or under the other Credit
Documents by reason of such Default or Event of Default (including in
connection with the sale of, collection from, or other realization
upon any of the Collateral or the enforcement of the Guaranty) or in
connection with any refinancing or restructuring of the credit
arrangements provided hereunder in the nature of a "work-out" or
pursuant to any insolvency or bankruptcy cases or proceedings.
10.3 INDEMNITY. In addition to the payment of expenses pursuant to Section
10.2, whether or not the transactions contemplated hereby shall be
consummated, each Credit Party agrees to defend (subject to
Indemnitees' selection of counsel), indemnify, pay and hold harmless,
each Agent and Lender and the officers, partners, directors, trustees,
employees, agents and Affiliates of each Agent and each Lender (each,
an "INDEMNITEE"), from and against any and all Indemnified
Liabilities; PROVIDED, no Credit Party shall have any obligation to
any Indemnitee hereunder with respect to any Indemnified Liabilities
to the extent such Indemnified Liabilities arise from the gross
negligence or willful misconduct of that Indemnitee. To the extent
that the undertakings to defend, indemnify, pay and hold harmless set
forth in this Section 10.3 may be unenforceable in whole or in part
because they are violative of any law or public policy, the applicable
Credit Party shall contribute the maximum portion that it is permitted
to pay and satisfy under applicable law to the payment and
satisfaction of all Indemnified Liabilities incurred by Indemnitees or
any of them. To the extent permitted by applicable law, no Credit
Party shall assert, and each hereby waives, any claim against any
Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual
damages) arising out of, in connection with, or as a result of, any
Credit Document or any agreement or instrument or transaction
contemplated hereby.
10.4 SET-OFF. In addition to any rights now or hereafter granted under
applicable law and not by way of limitation of any such rights, upon
the occurrence of any Event of Default each Lender is hereby
authorized by each Credit Party at any time or from time to time
subject to the consent of Administrative Agent (such consent not to be
unreasonably withheld or delayed), without notice to any Credit Party
or to any other Person (other than Administrative Agent), any
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such notice being hereby expressly waived, to set off and to
appropriate and to apply any and all deposits (general or special,
including Indebtedness evidenced by certificates of deposit, whether
matured or unmatured, but not including trust accounts) and any other
Indebtedness at any time held or owing by such Lender to or for the
credit or the account of any Credit Party against and on account of
the obligations and liabilities of any Credit Party to such Lender
hereunder, and participations therein and under the other Credit
Documents, including all claims of any nature or description arising
out of or connected hereto and participations therein or with any
other Credit Document, irrespective of whether or not (a) such Lender
shall have made any demand hereunder or (b) the principal of or the
interest on the Loans or any other amounts due hereunder shall have
become due and payable pursuant to Section 2 and although such
obligations and liabilities, or any of them, may be contingent or
unmatured. Each Credit Party hereby further grants to Administrative
Agent and each Lender a security interest in all Deposit Accounts
maintained with Administrative Agent or such Lender as security for
the Obligations.
10.5 AMENDMENTS AND WAIVERS.
(a) REQUISITE LENDERS' CONSENT. Subject to Section 10.5(b) and
10.5(c), no amendment, modification, termination or waiver of any
provision of the Credit Documents, or consent to any departure by
any Credit Party therefrom, shall in any event be effective
without the written concurrence of the Requisite Lenders.
(b) AFFECTED LENDERS' CONSENT. Without the written consent of each
Lender (other than a Defaulting Lender) that would be affected
thereby, no amendment, modification, termination, or consent
shall be effective if the effect thereof would:
(i) extend the scheduled final maturity of any Loan or Note;
(ii) waive, reduce or postpone any scheduled repayment (but not
prepayment);
(iii) reduce the rate of interest on any Loan (other than any
waiver of any increase in the interest rate applicable to
any Loan pursuant to Section 2.10) or any fee payable
hereunder;
(iv) extend the time for payment of any such interest or fees;
(v) reduce the principal amount of any Loan;
(vi) amend, modify, terminate or waive any provision of this
Section 10.5(b) or Section 10.5(c);
(vii) amend the definition of "REQUISITE LENDERS" or "PRO RATA
SHARE"; PROVIDED, with the consent of Requisite Lenders,
additional extensions of credit pursuant hereto may be
included in the determination of "REQUISITE LENDERS" or "PRO
RATA SHARE" on substantially the same basis as the Term Loan
Commitments, the Term Loans, the Revolving Commitments and
the Revolving Loans are included on the Effective Date;
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(viii) release or otherwise subordinate all or substantially all
of the Collateral or all or substantially all of the
Guarantors from the Guaranty except as expressly provided in
the Credit Documents;
(ix) consent to the assignment or transfer by any Credit Party of
any of its rights and obligations under any Credit Document;
(x) extend the stated expiration date of any Letter of Credit
beyond the Revolving Commitment Termination Date; or
(xi) reduce any reimbursement obligation in respect of any Letter
of Credit.
(c) OTHER CONSENTS. No amendment, modification, termination or waiver
of any provision of the Credit Documents, or consent to any
departure by any Credit Party therefrom, shall:
(i) increase any Revolving Commitment of any Lender over the
amount thereof then in effect without the consent of such
Lender; PROVIDED, no amendment, modification or waiver of
any condition precedent, covenant, Default or Event of
Default shall constitute an increase in any Revolving
Commitment of any Lender;
(ii) amend, modify, terminate or waive any provision hereof
relating to the Swing Line Sublimit or the Swing Line Loans
without the consent of Swing Line Lender;
(iii) amend the definition of "REQUISITE CLASS LENDERS" without
the consent of Requisite Class Lenders of each Class;
PROVIDED, with the consent of the Requisite Lenders,
additional extensions of credit pursuant hereto may be
included in the determination of such "REQUISITE CLASS
LENDERS" on substantially the same basis as the Term Loan
Commitments, the Term Loans, the Revolving Commitments and
the Revolving Loans are included on the Effective Date;
(iv) alter the required application of any repayments or
prepayments as between Classes pursuant to Section 2.14
without the consent of Requisite Class Lenders of each Class
which is being allocated a lesser repayment or prepayment as
a result thereof; PROVIDED, Requisite Lenders may waive, in
whole or in part, any prepayment so long as the application,
as between Classes, of any portion of such prepayment which
is still required to be made is not altered;
(v) amend, modify, terminate or waive any provision of Section 9
as the same applies to any Agent, or any other provision
hereof as the same applies to the rights or obligations of
any Agent, in each case without the consent of such Agent,
in each case without the consent of such Agent; or
(vi) amend, modify, terminate or waive any obligation of Lenders
relating to the purchase of participations in Letters of
Credit as provided in Section 2.23(e) without the written
consent of Administrative Agent and of Issuing Bank.
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(d) EXECUTION OF AMENDMENTS, ETC. Administrative Agent may, but shall
have no obligation to, with the concurrence of any Lender,
execute amendments, modifications, waivers or consents on behalf
of such Lender. Any waiver or consent shall be effective only in
the specific instance and for the specific purpose for which it
was given. No notice to or demand on any Credit Party in any case
shall entitle any Credit Party to any other or further notice or
demand in similar or other circumstances. Any amendment,
modification, termination, waiver or consent effected in
accordance with this Section 10.5 shall be binding upon each
Lender at the time outstanding, each future Lender and, if signed
by a Credit Party, on such Credit Party.
(e) REFINANCING TERM LOANS. Notwithstanding anything to the contrary
contained herein, this Agreement may be amended with the written
consent of the Administrative Agent, Company, the holders of not
less than 50.0% of the Revolving Exposure and the Lenders
providing the relevant Replacement Term Loans to permit the
refinancing of all outstanding Term Loans (the "REFINANCED TERM
LOAN") with a replacement term loan tranche hereunder (the
"REPLACEMENT TERM LOANS"), PROVIDED that (a) the aggregate
principal amount of such Replacement Term Loans shall not exceed
the aggregate principal amount of such Refinanced Term Loan, (b)
the interest rate for such Replacement Term Loans shall not be
higher than the interest rate for such Refinanced Term Loan, (c)
the weighted average life to maturity of such Replacement Term
Loans shall not be shorter than the weighted average life to
maturity of such Refinanced Term Loan at the time of such
refinancing and (d) all other terms applicable to such
Replacement Term Loans shall be substantially identical to, or
less favorable to the Lenders providing such Replacement Term
Loans than those applicable to such Refinanced Term Loan, except
to the extent necessary to provide for covenants and other terms
applicable to any period after the latest final maturity of the
Term Loans in effect immediately prior to such refinancing.
10.6 SUCCESSORS AND ASSIGNS; PARTICIPATIONS.
(a) GENERALLY. This Agreement shall be binding upon the parties
hereto and their respective successors and assigns and shall
inure to the benefit of the parties hereto and the successors and
assigns of Lenders. No Credit Party's rights or obligations
hereunder nor any interest therein may be assigned or delegated
by any Credit Party without the prior written consent of all
Lenders.
(b) REGISTER. Company, Administrative Agent and Lenders shall deem
and treat the Persons listed as Lenders in the Register as the
holders and owners of the corresponding Commitments and Loans
listed therein for all purposes hereof, and no assignment or
transfer of any such Commitment or Loan shall be effective, in
each case, unless and until an Assignment Agreement effecting the
assignment or transfer thereof shall have been delivered to and
accepted by Administrative Agent and recorded in the Register as
provided in Section 10.6(e). Prior to such recordation, all
amounts owed with respect to the applicable Commitment or Loan
shall be owed to the Lender listed in the Register as the owner
thereof, and any request, authority or consent of any Person who,
at the time of making such request or giving such authority or
consent, is listed in the Register as a Lender shall be prima
facie evidence thereof.
(c) RIGHT TO ASSIGN. Each Lender shall have the right at any time to
sell, assign or transfer all or a portion of its rights and
obligations under this Agreement, including, without limitation,
all or a portion of its Commitment or Loans owing to it, Note or
Notes held
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by it, or other Obligation (PROVIDED, HOWEVER, that each such
assignment shall be of a uniform, and not varying, percentage of
all rights and obligations under and in respect of any Loan and
any related Commitments):
(i) to any Person meeting the criteria of clause (i) of the
definition of the term of "Eligible Assignee" upon the
giving of notice to Company and Administrative Agent; and
(ii) to any Person meeting the criteria of clause (ii) of the
definition of the term of "Eligible Assignee" and, in the
case of assignments of Revolving Loans or Revolving
Commitments to any such Person (except in the case of
assignments made by or to GSCP), consented to by each of
Company and Administrative Agent (such consent not to be (x)
unreasonably withheld or delayed or, (y) in the case of
Company, required at any time an Event of Default shall have
occurred and then be continuing); PROVIDED, FURTHER each
such assignment pursuant to this Section 10.6(c)(ii) shall
be in an aggregate amount of not less than (A) $5,000,000
(or such lesser amount as may be agreed to by Company and
Administrative Agent or as shall constitute the aggregate
amount of the Revolving Commitments and/or Revolving Loans
of the assigning Lender) with respect to the assignment of
the Revolving Commitments and/or Revolving Loans and (B)
$1,000,000 (or such lesser amount as may be agreed to by
Company and Administrative Agent or as shall constitute the
aggregate amount of the Tranche F Term Loans of the
assigning Lender) with respect to the assignment of the
Tranche F Term Loans.
(d) MECHANICS. The assigning Lender and the assignee thereof shall
execute and deliver to Administrative Agent an Assignment
Agreement, together with (i) a processing and recordation fee of
$500 in the case of assignments pursuant to Section 10.6(c)(i) or
made by or to GSCP, and $2,000 in the case of all other
assignments (except that only one fee shall be payable in the
case of contemporaneous assignments to Related Funds), and (ii)
such forms, certificates or other evidence, if any, with respect
to United States federal income tax withholding matters as the
assignee under such Assignment Agreement may be required to
deliver to Administrative Agent pursuant to Section 2.19(c).
(e) NOTICE OF ASSIGNMENT. Upon its receipt of a duly executed and
completed Assignment Agreement, together with the processing and
recordation fee referred to in Section 10.6(d) (and any forms,
certificates or other evidence required by this Agreement in
connection therewith), Administrative Agent shall record the
information contained in such Assignment Agreement in the
Register, shall give prompt notice thereof to Company and shall
maintain a copy of such Assignment Agreement.
(f) REPRESENTATIONS AND WARRANTIES OF ASSIGNEE. Each Lender, upon
execution and delivery hereof or upon executing and delivering an
Assignment Agreement, as the case may be, represents and warrants
as of the Effective Date or as of the applicable Effective Date
(as defined in the applicable Assignment Agreement) that (i) it
is an Eligible Assignee; (ii) it has experience and expertise in
the making of or investing in commitments or loans such as the
applicable Commitments or Loans, as the case may be; and (iii) it
will make or invest in, as the case may be, its Commitments or
Loans for its own account in the ordinary course of its business
and without a view to distribution of such Commitments or Loans
within the meaning
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of the Securities Act or the Exchange Act or other federal
securities laws (it being understood that, subject to the
provisions of this Section 10.6, the disposition of such
Commitments or Loans or any interests therein shall at all times
remain within its exclusive control).
(g) EFFECT OF ASSIGNMENT. Subject to the terms and conditions of this
Section 10.6, as of the "Effective Date" specified in the
applicable Assignment Agreement: (i) the assignee thereunder
shall have the rights and obligations of a "Lender" hereunder to
the extent such rights and obligations hereunder have been
assigned to it pursuant to such Assignment Agreement and shall
thereafter be a party hereto and a "Lender" for all purposes
hereof; (ii) the assigning Lender thereunder shall, to the extent
that rights and obligations hereunder have been assigned thereby
pursuant to such Assignment Agreement, relinquish its rights
(other than any rights which survive the termination hereof under
Section 10.8) and be released from its obligations hereunder
(and, in the case of an Assignment Agreement covering all or the
remaining portion of an assigning Lender's rights and obligations
hereunder, such Lender shall cease to be a party hereto;
PROVIDED, anything contained in any of the Credit Documents to
the contrary notwithstanding, (y) Issuing Bank shall continue to
have all rights and obligations thereof with respect to such
Letters of Credit until the cancellation or expiration of such
Letters of Credit and the reimbursement of any amounts drawn
thereunder and (z) such assigning Lender shall continue to be
entitled to the benefit of all indemnities hereunder as specified
herein with respect to matters arising out of the prior
involvement of such assigning Lender as a Lender hereunder; (iii)
the Commitments shall be modified to reflect the Commitment of
such assignee and any remaining Commitment of such assigning
Lender, if any; and (iv) if any such assignment occurs after the
issuance of any Note hereunder, the assigning Lender shall, upon
the effectiveness of such assignment or as promptly thereafter as
practicable, surrender its applicable Notes to Administrative
Agent for cancellation, and thereupon Company shall issue and
deliver new Notes, if so requested by the assignee and/or
assigning Lender, to such assignee and/or to such assigning
Lender, with appropriate insertions, to reflect the new
Commitments and/or outstanding Loans of the assignee and/or the
assigning Lender.
(h) PARTICIPATIONS. Each Lender shall have the right at any time to
sell one or more participations to any Person (other than
Holdings, any of its Subsidiaries or any of its Affiliates) in
all or any part of its Commitments, Loans or in any other
Obligation. The holder of any such participation, other than an
Affiliate of the Lender granting such participation, shall not be
entitled to require such Lender to take or omit to take any
action hereunder except with respect to any amendment
modification or waiver that would (i) extend the final scheduled
maturity of any Loan, Note or Letter of Credit (unless such
Letter of Credit is not extended beyond the Revolving Commitment
Termination Date) in which such participant is participating, or
reduce the rate or extend the time of payment of Interest or Fees
thereon (except in connection with a waiver of applicability of
any post-default increase in interest rates) or reduce the
principal amount thereof, or increase the amount of the
participant's participation over the amount thereof then in
effect (it being understood that a waiver of any Default or Event
of Default or of a mandatory reduction in the Commitment shall
not constitute a change in the terms of such participation, and
that an increase in any Commitment or Loan shall be permitted
without the consent of any participant if the participant's
participation is not increased as a result thereof), (ii) consent
to the assignment or transfer by any Credit Party of any of its
rights and obligations under this Agreement or (iii) release all
or substantially all of the Collateral under the Collateral
Documents (except as expressly provided in the Credit Documents)
supporting the
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Loans hereunder in which such participant is participating. All
amounts payable by any Credit Party hereunder, including amounts
payable to such Lender pursuant to Section 2.17(c), 2.18 or 2.19,
shall be determined as if such Lender had not sold such
participation. Each Credit Party and each Lender hereby
acknowledge and agree that, solely for purposes of Sections 2.16
and 10.4, (1) any participation will give rise to a direct
obligation of each Credit Party to the participant and (2) the
participant shall be considered to be a "Lender."
(i) CERTAIN OTHER ASSIGNMENTS. In addition to any other assignment
permitted pursuant to this Section 10.6, (i) any Lender may
assign and pledge all or any portion of its Loans, the other
Obligations owed to such Lender, and its Notes, if any, to any
Federal Reserve Bank as collateral security pursuant to
Regulation A of the Board of Governors of the Federal Reserve
System and any operating circular issued by such Federal Reserve
Bank, and (ii) any Lender which is an investment fund may pledge
all or any portion of its Notes, if any, or Loans to its trustee
in support of its obligations to such trustee; PROVIDED, no
Lender, as between Company and such Lender, shall be relieved of
any of its obligations hereunder as a result of any such
assignment and pledge, and provided further, in no event shall
the applicable Federal Reserve Bank or trustee be considered to
be a "Lender" or be entitled to require the assigning Lender to
take or omit to take any action hereunder.
10.7 INDEPENDENCE OF COVENANTS. All covenants hereunder shall be given
independent effect so that if a particular action or condition is not
permitted by any of such covenants, the fact that it would be
permitted by an exception to, or would otherwise be within the
limitations of, another covenant shall not avoid the occurrence of a
Default or an Event of Default if such action is taken or condition
exists.
10.8 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS. All
representations, warranties and agreements made herein shall survive
the execution and delivery hereof and the making of any Credit
Extension. Notwithstanding anything herein or implied by law to the
contrary, the agreements of each Credit Party set forth in Sections
2.17(c), 2.18, 2.19, 10.2, 10.3 and 10.4 and the agreements of Lenders
set forth in Sections 2.16 and 9.6 shall survive the payment of the
Loans and the reimbursement of any amounts drawn thereunder, and the
termination hereof.
10.9 NO WAIVER; REMEDIES CUMULATIVE. No failure or delay on the part of any
Agent or any Lender in the exercise of any power, right or privilege
hereunder or under any other Credit Document shall impair such power,
right or privilege or be construed to be a waiver of any default or
acquiescence therein, nor shall any single or partial exercise of any
such power, right or privilege preclude other or further exercise
thereof or of any other power, right or privilege. The rights, powers
and remedies given to each Agent and each Lender hereby are cumulative
and shall be in addition to and independent of all rights, powers and
remedies existing by virtue of any statute or rule of law or in any of
the other Credit Documents or any of the Hedge Agreements. Any
forbearance or failure to exercise, and any delay in exercising, any
right, power or remedy hereunder shall not impair any such right,
power or remedy or be construed to be a waiver thereof, nor shall it
preclude the further exercise of any such right, power or remedy.
117
10.10 MARSHALLING; PAYMENTS SET ASIDE. Neither any Agent nor any Lender
shall be under any obligation to marshal any assets in favor of any
Credit Party or any other Person or against or in payment of any or
all of the Obligations. To the extent that any Credit Party makes a
payment or payments to Administrative Agent or Lenders (or to
Administrative Agent, on behalf of Lenders), or Administrative Agent
or Lenders enforce any security interests or exercise their rights of
setoff, and such payment or payments or the proceeds of such
enforcement or setoff or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to a trustee, receiver or any other party
under any bankruptcy law, any other state or federal law, common law
or any equitable cause, then, to the extent of such recovery, the
obligation or part thereof originally intended to be satisfied, and
all Liens, rights and remedies ~therefore or related thereto, shall be
revived and continued in full force and effect as if such payment or
payments had not been made or such enforcement or setoff had not
occurred.
10.11 SEVERABILITY. In case any provision in or obligation hereunder or any
Note shall be invalid, illegal or unenforceable in any jurisdiction,
the validity, legality and enforceability of the remaining provisions
or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.
10.12 OBLIGATIONS SEVERAL; INDEPENDENT NATURE OF LENDERS' RIGHTS. The
obligations of Lenders hereunder are several and no Lender shall be
responsible for the obligations or Commitment of any other Lender
hereunder. Nothing contained herein or in any other Credit Document,
and no action taken by Lenders pursuant hereto or thereto, shall be
deemed to constitute Lenders as a partnership, an association, a joint
venture or any other kind of entity. The amounts payable at any time
hereunder to each Lender shall be a separate and independent debt, and
each Lender shall be entitled to protect and enforce its rights
arising out hereof and it shall not be necessary for any other Lender
to be joined as an additional party in any proceeding for such
purpose.
10.13 ENTIRE AGREEMENT. This Agreement (together with the schedules hereto,
the letter agreements dated the date hereof and making specific
reference hereto, exhibits hereto, annexes hereto and the other
agreements, documents and instruments delivered pursuant hereto) and
the Credit Documents and Related Agreements constitute the entire
agreement among the parties or any of them with respect to the subject
matter hereof and thereof and supersede all other prior agreements and
understandings, both written and verbal, among the parties or any of
them with respect to the subject matter hereof.
10.14 HEADINGS. Section headings herein are included herein for convenience
of reference only and shall not constitute a part hereof for any other
purpose or be given any substantive effect.
10.15 APPLICABLE LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF.
118
10.16 CONSENT TO JURISDICTION. ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY
CREDIT PARTY ARISING OUT OF OR RELATING HERETO OR ANY OTHER CREDIT
DOCUMENT, OR ANY OF THE OBLIGATIONS, MAY BE BROUGHT IN ANY STATE OR
FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY
OF NEW YORK. BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH CREDIT
PARTY, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY
(A) ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE
JURISDICTION AND VENUE OF SUCH COURTS; (B) WAIVES ANY DEFENSE OF FORUM
NON CONVENIENS; (C) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH
PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL, RETURN RECEIPT REQUESTED, TO THE APPLICABLE CREDIT PARTY AT ITS
ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 10.1; (D) AGREES THAT
SERVICE AS PROVIDED IN CLAUSE (C) ABOVE IS SUFFICIENT TO CONFER
PERSONAL JURISDICTION OVER THE APPLICABLE CREDIT PARTY IN ANY SUCH
PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND
BINDING SERVICE IN EVERY RESPECT; AND (E) AGREES AGENTS AND LENDERS
RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW
OR TO BRING PROCEEDINGS AGAINST ANY CREDIT PARTY IN THE COURTS OF ANY
OTHER JURISDICTION.
10.17 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY AGREES TO
WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING HEREUNDER OR UNDER ANY OF THE OTHER
CREDIT DOCUMENTS OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT
MATTER OF THIS LOAN TRANSACTION OR THE LENDER/COMPANY RELATIONSHIP
THAT IS BEING ESTABLISHED. THE SCOPE OF THIS WAIVER IS INTENDED TO BE
ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY
COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION,
INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL
OTHER COMMON LAW AND STATUTORY CLAIMS. EACH PARTY HERETO ACKNOWLEDGES
THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS
RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THIS WAIVER IN ENTERING
INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS
WAIVER IN ITS RELATED FUTURE DEALINGS. EACH PARTY HERETO FURTHER
WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS
LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY
TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS
IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN
WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING
TO THIS SECTION 10.17 AND EXECUTED BY EACH OF THE PARTIES HERETO), AND
THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS HERETO OR ANY OF THE OTHER CREDIT
DOCUMENTS OR
119
TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE
HEREUNDER. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS
A WRITTEN CONSENT TO A TRIAL BY THE COURT.
10.18 CONFIDENTIALITY. Each Lender shall hold all non-public information
obtained pursuant to the requirements hereof which has been identified
as confidential by Company in accordance with such Lender's customary
procedures for handling confidential information of this nature and in
accordance with prudent lending or investing practices, it being
understood and agreed by Company that in any event a Lender may make
disclosures to Affiliates of such Lender (and to other persons
authorized by a Lender or Agent to organize, present or disseminate
such information in connection with disclosures otherwise made in
accordance with this Section 10.18), disclosures reasonably required
by any bona fide or potential assignee, transferee or participant in
connection with the contemplated assignment, transfer or participation
by such Lender of any Loans or any participations therein or by any
direct or indirect contractual counterparties (or the professional
advisors thereto) in Hedge Agreements (PROVIDED, such counterparties
and advisors are advised of and agree to be bound by the provisions of
this Section 10.18) or disclosures required or requested by any
governmental agency or representative thereof or by the NAIC or
pursuant to legal process; PROVIDED, unless specifically prohibited by
applicable law or court order, each Lender shall make reasonable
efforts to notify Company of any request by any governmental agency or
representative thereof (other than any such request in connection with
any examination of the financial condition or other routine
examination of such Lender by such governmental agency) for disclosure
of any such non-public information prior to disclosure of such
information.
10.19 USURY SAVINGS CLAUSE. Notwithstanding any other provision herein, the
aggregate interest rate charged with respect to any of the
Obligations, including all charges or fees in connection therewith
deemed in the nature of interest under applicable law shall not exceed
the Highest Lawful Rate. If the rate of interest (determined without
regard to the preceding sentence) under this Agreement at any time
exceeds the Highest Lawful Rate, the outstanding amount of the Loans
made hereunder shall bear interest at the Highest Lawful Rate until
the total amount of interest due hereunder equals the amount of
interest which would have been due hereunder if the stated rates of
interest set forth in this Agreement had at all times been in effect.
In addition, if when the Loans made hereunder are repaid in full the
total interest due hereunder (taking into account the increase
provided for above) is less than the total amount of interest which
would have been due hereunder if the stated rates of interest set
forth in this Agreement had at all times been in effect, then to the
extent permitted by law, Company shall pay to Administrative Agent an
amount equal to the difference between the amount of interest paid and
the amount of interest which would have been paid if the Highest
Lawful Rate had at all times been in effect. Notwithstanding the
foregoing, it is the intention of Lenders and Company to conform
strictly to any applicable usury laws. Accordingly, if any Lender
contracts for, charges, or receives any consideration which
constitutes interest in excess of the Highest Lawful Rate, then any
such excess shall be cancelled automatically and, if previously paid,
shall at such Lender's option be applied to the outstanding amount of
the Loans made hereunder or be refunded to Company.
120
10.20 REAFFIRMATION AND GRANT OF SECURITY INTEREST.
(a) Each Credit Party has (i) guarantied the Obligations and (ii)
created Liens in favor of Lenders on certain Collateral to secure
its obligations under Section 7 of the Existing Credit Agreement.
Each Credit Party hereby acknowledges that it has reviewed the
terms and provisions of this Agreement and consents to the
amendment and restatement of the Existing Credit Agreement
effected pursuant to this Agreement. Each Credit Party hereby (i)
confirms that each Credit Document to which it is a party or is
otherwise bound and all Collateral encumbered thereby will
continue to guarantee or secure, as the case may be, to the
fullest extent possible in accordance with the Credit Documents,
the payment and performance of all Guaranteed Obligations under
this Agreement and the Secured Obligations (as such term is
defined in the Pledge and Security Agreement) under the Pledge
and Security Agreement, as the case may be, including without
limitation the payment and performance of all such Guaranteed
Obligations under this Agreement and the Secured Obligations
under the Pledge and Security Agreement joint and several
obligations of each grantor now or hereafter existing, and (ii)
grants to the Collateral Agent for the benefit of the Secured
Parties (as such term is defined in the Pledge and Security
Agreement) a continuing lien on and security interest in and to
such Credit Party's right, title and interest in, to and under
all Collateral as collateral security for the prompt payment and
performance in full when due of the Guaranteed Obligations under
this Agreement and the Secured Obligations under the Pledge and
Security Agreement (whether at stated maturity, by acceleration
or otherwise).
(b) Each Credit Party acknowledges and agrees that any of the Credit
Documents to which it is a party or otherwise bound shall
continue in full force and effect and that all of its obligations
thereunder shall be valid and enforceable and shall not be
impaired or limited by the execution or effectiveness of the
amendment and restatement of the Existing Credit Agreement. Each
Credit Party represents and warrants that all representations and
warranties contained in the Credit Documents to which it is a
party or otherwise bound are true, correct and complete in all
material respects on and as of the Effective Date to the same
extent as though made on and as of that date, except to the
extent such representations and warranties specifically relate to
an earlier date, in which case they were true, correct and
complete in all material respects on and as of such earlier date.
10.21 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be
deemed an original, but all such counterparts together shall
constitute but one and the same instrument.
10.22 EFFECTIVENESS. This Agreement shall become effective upon the
execution of a counterpart hereof by each of the parties hereto and
receipt by Company and Administrative Agent of written or telephonic
notification of such execution and authorization of delivery thereof.
It is the intention of each of the parties hereto that the Existing
Credit Agreement be amended and restated so as to preserve the
perfection and priority of all security interests securing
indebtedness and obligations under the Existing Credit Agreement and
that all Indebtedness and Obligations of Company and its Subsidiaries
hereunder and thereunder shall be secured by the Collateral Documents
and that this Agreement does not constitute a novation of the
obligations and liabilities existing under the Existing Credit
Agreements. The parties hereto further acknowledge and agree that this
Agreement constitutes an amendment of the Existing Credit Agreement
made under and in accordance with the terms of subsection 10.5 of the
Existing Credit Agreement. In addition, unless specifically amended
hereby, each of the Credit
121
Documents, the Exhibits and Schedules to the Existing Credit Agreement
shall continue in full force and effect and that, from and after the
Effective Date, all references to the "CREDIT AGREEMENT" contained
therein shall be deemed to refer to this Agreement. Notwithstanding
the intent of the parties hereto that this amendment and restatement
is not a novation of the Existing Credit Agreement, Company hereby
designates the Obligations hereunder as "Designated Senior Debt" under
the New Company Subordinated Note Indenture in accordance with the
terms thereof and Company hereby agrees that it shall not designate
any other Indebtedness as "Designated Senior Debt" under the New
Company Subordinated Note Indenture.
10.23 REINSTATEMENT. This Agreement shall remain in full force and effect
and continue to be effective should any petition be filed by or
against any Credit Party for liquidation or reorganization, should any
Credit Party become insolvent or make an assignment for the benefit of
any creditor or creditors or should a receiver or trustee be appointed
for all or any significant part of any Credit Party's assets, and
shall continue to be effective or to be reinstated, as the case may
be, if at any time payment and performance of the Obligations, or any
part thereof, is, pursuant to applicable law, rescinded or reduced in
amount, or must otherwise be restored or returned by any obligee of
the Obligations, whether as a "voidable preference," "fraudulent
conveyance," or otherwise, all as though such payment or performance
had not been made. In the event that any payment, or any part thereof,
is rescinded, reduced, restored or returned, the Obligations shall be
reinstated and deemed reduced only by such amount paid and not so
rescinded, reduced, restored or returned.
[Remainder of page intentionally left blank]
122
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.
COMPANY: VICAR OPERATING, INC.
By: /s/ Robert L. Antin
----------------------------------------------------
Name: Robert L. Antin
Title: Chief Executive Officer and President
By: /s/ Tomas W. Fuller
----------------------------------------------------
Name: Tomas W. Fuller
Title: Chief Financial Officer and Secretary
HOLDINGS: VCA ANTECH, INC.
By: /s/ Robert L. Antin
----------------------------------------------------
Name: Robert L. Antin
Title: Chief Executive Officer and President
By: /s/ Tomas W. Fuller
----------------------------------------------------
Name: Tomas W. Fuller
Title: Chief Financial Officer and Secretary
SECOND AMENDED AND RESTATED
CREDIT AND GUARANTY AGREEMENT EXECUTION
GUARANTORS:
VCA ANTECH, INC.
VICAR OPERATING, INC.
AAH MERGER CORPORATION
AHC OF SOUTHERN SARATOGA COUNTY, INC.
ALBANY VETERINARY CLINIC, INC.
ANIMAL CENTER, INC.
ANIMAL CLINIC OF SANTA CRUZ, INC.
APEX VETERINARY HOSPITAL, INC.
ARROYO PETCARE CENTER, INC.
ASSOCIATES IN PET CARE, S.C.
BERWYN VETERINARIAN HOSPITAL, INC.
BROWN ANIMAL HOSPITAL, INC.
CACOOSING ANIMAL HOSPITAL, LTD.
CAT CLINIC OF TULSA, INC.
CLARMAR ANIMAL HOSPITAL, INC.
CORNERSTONE VETERINARY HOSPITAL, INC.
C.V.T., INC.
DETWILER VETERINARY CLINIC, INC.
DIAGNOSTIC VETERINARY SERVICE, INC.
EAGLE PARK ANIMAL CLINIC, INC.
EAGLE RIVER VETERINARY HOSPITAL, INC.
EAST MILL PLAIN ANIMAL HOSPITAL, INC.
EDGEBROOK, INC.
FLORIDA VETERINARY LABORATORIES, INC.
FOX CHAPEL ANIMAL HOSPITAL, INC.
FREEHOLD, INC.
GLEN ANIMAL HOSPITAL, INC.
GOLDEN MERGER CORPORATION
HALECREST VETERINARY HOSPITAL, INC.
H.B. ANIMAL CLINICS, INC.
HIGHLANDS ANIMAL HOSPITAL, INC.
INDIANA VETERINARY DIAGNOSTIC LAB, INC.
KIRKWOOD ANIMAL HOSPITAL - LEA M.E. TAMMI, V.M.D., P.A.
KIRKWOOD ANIMAL HOSPITAL BOARDING & GROOMING, INC.
LAFAYETTE VETERINARY HOSPITAL, PC
LAKE JACKSON VETERINARY CLINIC, INC.
LAKEWOOD ANIMAL HOSPITAL, INC.
LAMMERS VETERINARY HOSPITAL, INC.
LEWELLING VETERINARY HOSPITAL, INC.
MAIN STREET SMALL ANIMAL HOSPITAL, INC.
MILLER ANIMAL HOSPITAL, INC.
MISSION ANIMAL HOSPITAL, INC.
S-2
SECOND AMENDED AND RESTATED
CREDIT AND GUARANTY AGREEMENT EXECUTION
MS ANIMAL HOSPITAL, INC.
NATIONAL PETCARE CENTERS, INC.
NEWARK ANIMAL HOSPITAL, INC.
NORTHERN ANIMAL HOSPITAL INC.
NORTH ROCKVILLE VETERINARY HOSPITAL, INC.
NORTHSIDE ANIMAL HOSPITAL, P.C.
NOYES ANIMAL HOSPITAL, INC.
NPC OPERATIONS, INC.
OCEAN BEACH VETERINARY HOSPITAL, INC.
OLD TOWN VETERINARY HOSPITAL, INC.
PET CARE HOSPITAL, INC.
PET'S RX, INC.
PETS' RX NEVADA, INC.
PPI OF PENNSYLVANIA, INC.
PRESTON PARK ANIMAL HOSPITAL, INC.
PRINCETON ANIMAL HOSPITAL, INC.
PROFESSIONAL VETERINARY SERVICES, INC.
RIVIERA ANIMAL HOSPITAL, INC.
ROSSMOOR - EL DORADO ANIMAL HOSPITAL, INC.
SILVER SPUR ANIMAL HOSPITAL, INC.
SOUND TECHNOLOGIES, INC.
SOUTH COUNTY VETERINARY CLINIC, INC.
SOUTHEAST AREA VETERINARY MEDICAL CENTER, PC
SPANISH RIVER ANIMAL HOSPITAL, INC.
SUNDOWN ANIMAL CLINIC, LTD.
TAMPA ANIMAL MEDICAL CENTER, INC.
TANGLEWOOD PET HOSPITAL, INC.
TEMPE VETS, A PROFESSIONAL CORPORATION
THE PET PRACTICE (FLORIDA), INC.
THE PET PRACTICE (ILLINOIS), INC.
THE PET PRACTICE (MASSACHUSETTS), INC.
THE PET PRACTICE OF MICHIGAN, INC.
TOMS RIVER VETERINARY HOSPITAL, P.A.
TOTAL CARE ANIMAL HOSPITAL, INC.
UNIVERSITY PET CLINIC INC.
VCA - ASHER, INC.
VCA ALABAMA, INC.
VCA ALBANY ANIMAL HOSPITAL, INC.
VCA OF ALBUQUERQUE, INC.
VCA ALL PETS ANIMAL COMPLEX, INC.
VCA ALPINE ANIMAL HOSPITAL, INC.
VCA ANDERSON ANIMAL HOSPITAL, INC.
VCA ANDERSON OF CALIFORNIA ANIMAL HOSPITAL, INC.
S-3
SECOND AMENDED AND RESTATED
CREDIT AND GUARANTY AGREEMENT EXECUTION
VCA ANIMAL HOSPITALS, INC.
VCA APAC ANIMAL HOSPITAL, INC.
VCA CACOOSING ANIMAL HOSPITAL, INC.
VCA CASTLE SHANNON VETERINARY HOSPITAL INC.
VCA CENTERS-TEXAS, INC.
VCA CENVET, INC.
VCA CLARMAR ANIMAL HOSPITAL, INC.
VCA CLINICAL VETERINARY LABS, INC.
VCA CLINIPATH LABS, INC.
VCA CLOSTER, INC.
VCA DETWILER ANIMAL HOSPITAL, INC.
VCA DOVER ANIMAL HOSPITAL, INC.
VCA EAGLE RIVER ANIMAL HOSPITAL, INC.
VCA EAST ANCHORAGE ANIMAL HOSPITAL, INC.
VCA EMERGENCY PET CLINIC, INC.
VCA GREATER SAVANNAH ANIMAL HOSPITAL, INC.
VCA HOWELL BRANCH ANIMAL HOSPITAL, INC.
VCA KANEOHI ANIMAL HOSPITAL
VCA LAKESIDE ANIMAL HOSPITAL, INC.
VCA LAMB & STEWART ANIMAL HOSPITAL, INC.
VCA LAMMERS ANIMAL HOSPITAL, INC.
VCA LEWIS ANIMAL HOSPITAL, INC.
VCA MARINA ANIMAL HOSPITAL, INC.
VCA MILLER-ROBERTSON
VCA - MISSION, INC.
VCA MISSOURI, INC.
NORTH COAST VETERINARY MEDICAL GROUP, INC.
VCA NORTHBORO ANIMAL HOSPITAL, INC.
VCA NORTHWEST VETERINARY DIAGNOSTICS, INC.
VCA OF NEW YORK, INC.
VCA OF SAN JOSE, INC.
VCA OF TERESITA, INC.
VCA PROFESSIONAL ANIMAL LABORATORY, INC.
VCA REAL PROPERTY ACQUISITION CORPORATION
VCA REFERRAL ASSOCIATES ANIMAL HOSPITAL, INC.
VCA ROHRIG ANIMAL HOSPITAL, INC.
VCA ROSSMOOR, INC.
VCA SILVER SPUR ANIMAL HOSPITAL, INC.
VCA SOUTH SHORE ANIMAL HOSPITAL, INC.
VCA SQUIRE ANIMAL HOSPITAL, INC.
VCA ST. PETERSBURG ANIMAL HOSPITAL, INC.
VCA TEXAS MANAGEMENT, INC.
VCA WORTH ANIMAL HOSPITAL, INC.
VCA WYOMING ANIMAL HOSPITAL, INC.
S-4
SECOND AMENDED AND RESTATED
CREDIT AND GUARANTY AGREEMENT EXECUTION
VETERINARY HOSPITALS, INC.
WEST SHORE VETERINARY HOSPITAL, INC.
WEST LOS ANGELES VETERINARY MEDICAL GROUP, INC.
WILLIAM C. FOUTS, LTD.
WINGATE, INC.
WOODLAND ANIMAL MEDICAL CENTER, INC.
By: /s/ Tomas W. Fuller
--------------------------------------------
Name: Tomas W. Fuller
Title: Chief Financial Officer and Secretary
VETERINARY CENTERS OF AMERICA - TEXAS, L.P.
BY: VCA CENTERS-TEXAS, INC., GENERAL PARTNER
By: /s/ Robert L. Antin
--------------------------------------------
Name: Robert L. Antin
Title: Chief Executive Officer and President
By: /s/ Tomas W. Fuller
--------------------------------------------
Name: Tomas W. Fuller
Title: Chief Financial Officer and Secretary
S-5
SECOND AMENDED AND RESTATED
CREDIT AND GUARANTY AGREEMENT EXECUTION
JOINT LEAD ARRANGER,
SOLE SYNDICATION AGENT AND
A LENDER: GOLDMAN SACHS CREDIT PARTNERS L.P.
By: /s/
---------------------------------
Authorized Signatory
S-6
SECOND AMENDED AND RESTATED
CREDIT AND GUARANTY AGREEMENT EXECUTION
JOINT LEAD ARRANGER,
ADMINISTRATION AGENT,
SWING LINE LENDER, ISSUING
BANK AND A LENDER: WELLS FARGO BANK, N.A.,
By: /s/ S. Michael St. Geme
---------------------------------
Name: S. Michael St. Geme
Title: Vice President
S-7
SECOND AMENDED AND RESTATED
CREDIT AND GUARANTY AGREEMENT EXECUTION
APPENDIX A-1
TO CREDIT AND GUARANTY AGREEMENT
TRANCHE F TERM LOAN COMMITMENTS
LENDER TRANCHE F TERM LOAN COMMITMENTS
Goldman Sachs Credit Partners L.P. $ 13,764,167
Wells Fargo Bank $ 59,700,000
Continuing Lenders $150,410,833
APPENDIX A-1-1
APPENDIX B
TO CREDIT AND GUARANTY AGREEMENT
NOTICE ADDRESSES
VICAR OPERATING, INC.
12401 West Olympic Boulevard
Los Angeles, California 90064-1022
Attention: Tomas Fuller
Telecopier: (310) 571-6700
VETERINARY CENTERS OF AMERICA, INC.
12401 West Olympic Boulevard
Los Angeles, California 90064-1022
Attention: Tomas Fuller
Telecopier: (310) 571-6700
SUBSIDIARY GUARANTOR'S
c/o VCA Antech, Inc.
12401 West Olympic Boulevard
Los Angeles, California 90064-1022
Attention: Tomas Fuller
Telecopier: (310) 571-6700
GOLDMAN SACHS CREDIT PARTNERS L.P.,
as Joint Lead Arranger, Syndication Agent and a Lender
Goldman Sachs Credit Partners L.P.
85 Broad Street
New York, New York 10004
Attention: Stephen King
Telecopier: (212) 357-0932
APPENDIX B-1
with a copy to:
Goldman Sachs Credit Partners L.P. (for Assignment Agreements only)
85 Broad Street
New York, New York 10004
Attention: Sandra Stulberger
Telecopier: (212) 357-4597
Goldman Sachs Credit Partners L.P. (for Loan Activity)
85 Broad Street
New York, New York 10004
Attention: Philip F. Green
Telecopier: (212) 357-4597
Goldman Sachs Credit Partners L.P. (for Financials, Amendments,
Credit Documents & Voting)
85 Broad Street
New York, New York 10004
Attention: Pedro Ramirez
Telecopier: (212) 357-4597
WELLS FARGO BANK, N.A.
as Joint Lead Arranger, Administrative
Agent, Swing Line Lender and a Lender
Administrative Agent's Principal Office:
333 South Grand Avenue, 9th Floor
Los Angeles, California 90071
Attention: S. Michael St. Geme
Telecopier: (213) 628-9694
Swing Line Lender's Principal Office:
333 South Grand Avenue, 9th Floor
Los Angeles, California 90071
Attention: S. Michael St. Geme
Telecopier: (213) 628-9694
APPENDIX B-2